Servicer Events of Default. (a) If any one of the following events (“Servicer Events of Default”) shall occur and be continuing: (i) (A) The failure by the Servicer to make any Monthly Advance which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due; (ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Trustee or to the Servicer and the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action; (iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or (iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or (v) the Servicer Termination Test is failed; or (a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or (vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or (viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10; (ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or (x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement. (b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination. (c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated. (d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Pooling and Servicing Agreement (Renaissance Home Equity Loan Trust 2007-3), Pooling and Servicing Agreement (Renaissance Home Equity Loan Trust 2007-3)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2020-B Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2020-B Exchange Note or to this 2020-B Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2020-B Exchange Note under the Basic Servicing Agreement or this 2020-B Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2020-B Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2020-B Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2020-B Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2020-B Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2020-B Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2020-B Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2020-B Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2020-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementB Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2020-B Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the written direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2020-B Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the written direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2020-B Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitationSection, the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2020-B Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2020-B Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2020-B Leases and other reasonable out2020-of-pocket costs B Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2020-B Leases and transferring the Mortgage Files 2020-B Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2020-B), Servicing Supplement (Mercedes-Benz Auto Lease Trust 2020-B)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2016-B Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2016-B Exchange Note or to this 2016-B Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2016-B Exchange Note under the Basic Servicing Agreement or this 2016-B Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2016-B Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2016-B Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2016-B Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2016-B Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2016-B Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2016-B Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2016-B Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2016-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementB Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2016-B Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2016-B Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2016-B Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitation7.01(a), the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2016-B Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2016-B Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2016-B Leases and other reasonable out2016-of-pocket costs B Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2016-B Leases and transferring the Mortgage Files 2016-B Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2016-B), Servicing Supplement (Mercedes-Benz Auto Lease Trust 2016-B)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2023-A Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2023-A Exchange Note or to this 2023-A Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2023-A Exchange Note under the Basic Servicing Agreement or this 2023-A Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2023-A Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2023-A Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2023-A Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2023-A Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2023-A Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2023-A Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2023-A Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2023-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementA Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2023-A Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the written direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2023-A Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the written direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2023-A Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitationSection, the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2023-A Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2023-A Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2023-A Leases and other reasonable out2023-of-pocket costs A Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2023-A Leases and transferring the Mortgage Files 2023-A Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2023-A), Servicing Supplement (Mercedes-Benz Auto Lease Trust 2023-A)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2024-A Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2024-A Exchange Note or to this 2024-A Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2024-A Exchange Note under the Basic Servicing Agreement or this 2024-A Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2024-A Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2024-A Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2024-A Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2024-A Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2024-A Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2024-A Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2024-A Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2024-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementA Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2024-A Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the written direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2024-A Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the written direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2024-A Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitationSection, the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2024-A Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2024-A Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2024-A Leases and other reasonable out2024-of-pocket costs A Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2024-A Leases and transferring the Mortgage Files 2024-A Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2024-A), Servicing Supplement (Mercedes-Benz Auto Lease Trust 2024-A)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2016-A Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2016-A Exchange Note or to this 2016-A Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2016-A Exchange Note under the Basic Servicing Agreement or this 2016-A Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2016-A Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2016-A Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2016-A Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2016-A Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2016-A Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of certain Insolvency Events with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2016-A Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2016-A Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2016-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementA Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2016-A Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2016-A Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2016-A Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitation7.01(a), the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2016-A Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2016-A Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2016-A Leases and other reasonable out2016-of-pocket costs A Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2016-A Leases and transferring the Mortgage Files 2016-A Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2016-A), Servicing Supplement (Mercedes-Benz Auto Lease Trust 2016-A)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2019-A Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2019-A Exchange Note or to this 2019-A Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2019-A Exchange Note under the Basic Servicing Agreement or this 2019-A Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2019-A Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2019-A Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2019-A Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2019-A Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2019-A Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2019-A Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2019-A Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2019-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementA Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2019-A Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2019-A Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2019-A Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitation7.01(a), the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2019-A Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2019-A Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2019-A Leases and other reasonable out2019-of-pocket costs A Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2019-A Leases and transferring the Mortgage Files 2019-A Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2019-A), Servicing Supplement (Mercedes-Benz Auto Lease Trust 2019-A)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2020-A Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2020-A Exchange Note or to this 2020-A Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2020-A Exchange Note under the Basic Servicing Agreement or this 2020-A Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2020-A Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2020-A Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2020-A Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2020-A Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2020-A Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2020-A Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2020-A Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2020-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementA Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2020-A Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2020-A Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2020-A Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitationSection, the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2020-A Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2020-A Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2020-A Leases and other reasonable out2020-of-pocket costs A Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2020-A Leases and transferring the Mortgage Files 2020-A Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2020-A), Servicing Supplement (Mercedes-Benz Auto Lease Trust 2020-A)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2024-B Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2024-B Exchange Note or to this 2024-B Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2024-B Exchange Note under the Basic Servicing Agreement or this 2024-B Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2024-B Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2024-B Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2024-B Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2024-B Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2024-B Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2024-B Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2024-B Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2024-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementB Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2024-B Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the written direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2024-B Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the written direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2024-B Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitationSection, the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2024-B Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2024-B Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2024-B Leases and other reasonable out2024-of-pocket costs B Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2024-B Leases and transferring the Mortgage Files 2024-B Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2024-B), Servicing Supplement (Mercedes-Benz Auto Lease Trust 2024-B)
Servicer Events of Default. (a) If any one a Servicer Event of the following events (“Servicer Events of Default”) shall occur and be continuing:
(i) (A) The failure by the Servicer to make any Monthly Advance which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit Default described in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Servicing Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) daysshall occur, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Trustee or to the Servicer and the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a the Servicer Event of Default shall not have been remedied, the Depositor or the Trustee may, and the Trustee shall (xi) with respect solely to clause (a)(i)(A) above, (1) on if the related Deposit Date, upon receipt Servicer Event of written notice or discovery by the Master Servicer or Default occurs as a Responsible Officer result of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the Servicer’s failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly required P&I Advance, or (ii) at otherwise the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the written direction of the Holders of Offered Certificates evidencing not less than entitled to at least 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee defaulting Servicer (and to the extent Depositor if given by the applicable current contact information has been provided Trustee or to the Trustee if given by the Depositor) with a copy to the Master Servicer), the Servicer and each Rating Agencies and if given by Holders of Certificates, to the TrusteeAgency, terminate all of the rights and obligations of the defaulting Servicer in its capacity as servicer the Servicer under the Servicing Agreement, to the extent permitted by law, and in and to the related Mortgage Loans and the proceeds thereof. If the Servicer Event of Default occurs as a result of the Servicer’s failure to make a required P&I Advance which failure is not remedied within the time frame set forth in the Servicing Agreement, the Trustee shall, by notice in writing to the defaulting Servicer, the Depositor and the Master Servicer, terminate all of the rights and obligations of the defaulting Servicer in its capacity as the Servicer under the Servicing Agreement and in and to the related Mortgage Loans and the proceeds thereof. Subject to Section 8.02 of this Agreement. On , on or after the receipt by the defaulting Servicer of such written notice, all authority and power of the defaulting Servicer under this Agreement, the Servicing Agreement whether with respect to the Certificates (other than as a Holder of any Certificate) or the related Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer Master Servicer, pursuant to and under this Section 8.01; Section, and, without limitation, the Successor Master Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicerempowered, as attorney-in-fact or otherwise, to execute and deliver, on behalf of and at the expense of the defaulting Servicer, any and all documents and other instruments, instruments and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement or assignment of each the related Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to shall cooperate with the Successor ServicerMaster Servicer or other successor servicer in connection with the transfer of servicing to such successor servicer in accordance with the Servicing Agreement. The Servicer shall continue to be entitled to receive all amounts accrued or owing to it under the Servicing Agreement on or prior to the date of such termination, whether in respect of P&I Advances, Servicing Advances, accrued and unpaid Servicing Fees or otherwise, notwithstanding any such termination, with respect to events occurring prior to such termination). Reimbursement of u▇▇▇▇▇▇▇▇▇▇▇ ▇&▇ Advances, Servicing Advances and accrued and unpaid Servicing Fees shall be made on a first in, first out (“FIFO”) basis no later than the Servicer Remittance Date. For purposes of this Section 8.01(a), the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights shall not be deemed to have knowledge of the Servicer hereunder, including, without limitation, Event of Default unless a Responsible Officer of the transfer Trustee assigned to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it working in the Collection Account, Trustee’s Corporate Trust Office has actual knowledge thereof or that have been deposited by unless written notice of any event which is in fact such the predecessor Servicer in the Collection Account or thereafter Event of Default is received by the predecessor Trustee at its Corporate Trust Office and such notice references the Certificates, the Trust or this Agreement. The Trustee shall promptly notify the Master Servicer with respect and the Rating Agencies of the occurrence of the Servicer Event of Default of which it has knowledge as provided above. The Master Servicer shall be entitled to be reimbursed by the Mortgage Loans. All Servicing Transfer Costs and other defaulting Servicer (or from amounts on deposit in the Distribution Account if the defaulting Servicer is unable to fulfill its obligations hereunder) for all reasonable out-of-pocket or third party costs and expenses (including attorneys’ fees) incurred in connection associated with the termination transfer of servicing from the Servicer defaulting Servicer, including without limitation, any reasonable out-of-pocket or third party costs or expenses associated with the complete transfer of all servicing data and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect completion, correction or manipulation of such succession servicing data as Servicer pursuant to this Section 8.01 shall may be paid required by the predecessor Master Servicer within 90 days of written demand, itemized to correct any errors or insufficiencies in reasonable detail, or, the servicing data or otherwise to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is enable the Master Servicer, by Servicer to service the initial Servicer)related Mortgage Loans properly and effectively, upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Pooling and Servicing Agreement (ACE Securities Corp. Home Equity Loan Trust, Series 2006-Cw1), Pooling and Servicing Agreement (ACE Securities Corp. Home Equity Loan Trust, Series 2006-Cw1)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2018-A Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2018-A Exchange Note or to this 2018-A Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2018-A Exchange Note under the Basic Servicing Agreement or this 2018-A Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2018-A Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2018-A Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2018-A Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2018-A Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2018-A Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2018-A Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2018-A Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2018-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementA Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2018-A Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2018-A Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2018-A Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitation7.01(a), the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2018-A Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2018-A Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2018-A Leases and other reasonable out2018-of-pocket costs A Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2018-A Leases and transferring the Mortgage Files 2018-A Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2018-A), Servicing Supplement (Mercedes-Benz Auto Lease Trust 2018-A)
Servicer Events of Default. (a) If any one Any of the following events (“acts or occurrences shall constitute a Servicer Events Event of Default”) shall occur and be continuing:
(i) (A) The any failure by the Servicer to make deliver to the Subservicer for payment to Noteholders any Monthly Advance which continues unremedied for a period proceeds or payments received from an Obligor or in respect of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit Trust Estate and required to be made so delivered under the terms of the Indenture and this Agreement which that continues unremedied for a period of two (2) Business Days after such deposit was due or (C) until 1:00 p.m., Chicago time, on the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) second successive Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of following such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Trustee or to the Servicer and the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case Subservicer, upon receiving actual knowledge of a failure that cannot be cured within sixty (60) dayssuch failure, the cure period may be extended if shall give the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court prompt written, telecopied or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written telephonic notice of such failure. Notwithstanding the foregoing, requiring any failure by the same Subservicer to be remedied, shall have been given deliver such notice to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon prevent the occurrence of a Servicer Event of Default; or
(ii) any failure by the Servicer to deliver a Monthly Servicer's Report pursuant to Section 4.01 hereof that continues unremedied until 1:00 p.m., Chicago time, the following Business Day; provided, however, that if the Trustee has actual knowledge that the Servicer has not delivered the Monthly Servicer's Report by 1:00 p.m., Chicago time, on a Determination Date, the Trustee shall give the Servicer written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall act as Servicer under this Agreement, subject to not prevent the right occurrence of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect Default; or
(iii) any failure by the Servicer to such Successor Servicer or other Person. At such remit any Purchase Price received by it to the Subservicer that continues unremedied until 4:00 p.m., Chicago time, the provisions of Section 8.01 (c) and (d) shall become applicable following Business Day; provided, however, that if the Servicer has not remitted any Purchase Price received by it to the then-acting Servicer Subservicer by 2:00 p.m., Chicago time, on the Determination Date and the Person then-obligated Trustee has received written notification from the Subservicer by way of the Monthly Servicer's Report or otherwise that such Purchase Price has not been paid, the Trustee shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to succeed deliver such then-acting Servicer.notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
Appears in 2 contracts
Sources: Servicing Agreement (Trendwest Resorts Inc), Servicing Agreement (Trendwest Resorts Inc)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 201[__]-[__] Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 201[__]-[__] Exchange Note or to this 201[__]-[__] Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 201[__]-[__] Exchange Note under the Basic Servicing Agreement or this 201[__]-[__] Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 201[__]-[__] Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 201[__]-[__] Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 201[__]-[__] Servicing Agreement or any certificate, report or other writing delivered pursuant to the 201[__]-[__] Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 201[__]-[__] Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of certain Insolvency Events with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 201[__]-[__] Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 201[__]-[__] Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement201[__]-[__] Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 201[__]-[__] Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 201[__]-[__] Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement201[__]-[__] Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf terms of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwiseBasic Servicing Agreement. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 201[__]-[__] Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 201[__]-[__] Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 201[__]-[__] Leases and other reasonable out-of-pocket costs 201[__]-[__] Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 201[__]-[__] Leases and transferring the Mortgage Files 201[__]-[__] Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Servicing Supplement (Daimler Trust), Servicing Supplement (Daimler Trust)
Servicer Events of Default. (a) If any one of the I. The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Master Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Master Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure the date upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Master Servicer and the Note Insurer by the Indenture Trustee or to the Master Servicer to deposit in and the Collection Account Indenture Trustee by the Note Insurer or the Distribution Account any deposit required to be made under the terms Noteholders affected thereby evidencing Percentage Interests of this Agreement which continues unremedied for a period of two at least __%;
(2) Business Days after such deposit was due or (Cii) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Master Servicer to make any required Servicing Advance Advance, which failure continues unremedied for a period of sixty thirty (6030) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 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 Master Servicer, the Securities Administrator or the Indenture Trustee or to the Master Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25__%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing any failure on the part of a petition against the Master Servicer in a court duly to observe or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator perform in any insolvency, conservatorship, receivership, readjustment material respect any other of debt, marshaling the covenants or agreements on the part of assets and liabilities or similar proceedingsthe Master Servicer contained in this Agreement, or for the winding up or liquidation of its affairs, and the continuance failure of any such decree or order unstayed representation and in effect warranty made pursuant to Section 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) consecutive days; ordays 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 __%;
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises an involuntary case under any present or future federal or state bankruptcy, insolvency or similar law or for the appointment of a conservator, receiver, liquidator conservator or similar person receiver or liquidation in any insolvency, readjustment of debt, marshaling 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; or 's property;
(vi) the Master Servicer shall admit in writing its inability generally to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors creditors, or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or;
(vii) the Note Insurer shall notify the Indenture Trustee of any reduction or withdrawal "event of default" under the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; orInsurance Agreement;
(viii) if on any Payment Date the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10Rolling Three Month Delinquency Rate exceeds ___%;
(ix) if on any Payment Date, the failure by Twelve Month Loss Amount exceeds ___% of the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to Aggregate Principal Balance of the Mortgage Loans, which failure continues unremedied for a period as of fifteen days after the date close of business on which written notice the first day of such failurethe twelfth preceding calendar month;
(x) if the total stockholders' equity of the Master Servicer, requiring the same to be remedied, shall have been given to the Servicer as determined by the Master Servicer; or
(x) 's independent accountants in accordance with generally accepted accounting principles, shall be less than the identification under any filing pursuant to Section 404 sum of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on $___________ and (2) the related Deposit Date, upon receipt of written notice or discovery by net proceeds to the Master Servicer of any initial public offering of its common stock;
(xi) if the total on- or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, off-balance sheet financing available to the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not be less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.$___________;
(cxii) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on under the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such directionIndenture; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.or
Appears in 2 contracts
Sources: Sale and Servicing Agreement (Accredited Home Lenders Inc), Sale and Servicing Agreement (Accredited Home Lenders Inc)
Servicer Events of Default. (a) If any one of the The following events (shall each constitute a “Servicer Events Event of Default”) shall occur and be continuing” hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below and Delinquency Advances, which shall have no cure period), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and Indenture Trustee by the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25%; provided, however, provided however that any failed remittance cured within one Business Day of such failure shall include interest accrued at the Prime Rate (as set forth in the case Wall Street Journal) on the amount of a failure that cannot such remittance from and including the date the remittance was required to be cured within sixty (60) days, made to and including the cure period may be extended if date the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial actionremittance was actually made;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Servicer; orIndenture Trustee or to the Servicer and the Indenture Trustee by the Noteholders affected thereby evidencing Percentage Interests of at least 25%;
(xiii) any failure on the identification under part of the Servicer duly to observe or perform in any filing material respect any other of the covenants or agreements on the part of the Servicer contained in this Agreement, or the failure of any representation and warranty made pursuant to Section 404 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) days after the S▇▇▇▇▇▇▇date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by the 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-▇▇▇▇▇ Act up or liquidation of 2002 which identifies material weaknesses its affairs, shall have been entered against the Servicer and such decree or order shall have remained in connection with force, undischarged or unstayed for a period of ninety (90) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer’s ongoing evaluation property;
(vi) the Servicer shall admit in writing its inability generally to pay its debts as they become due, file a petition to take advantage of internal controls which materially and adversely affect any applicable insolvency or reorganization statute, make an assignment for the Servicer’s ability to perform any benefit of its duties under this Agreement.creditors, or voluntarily suspend payment of its obligations;
(bvii) thenif on any Payment Date the Rolling Six Month Delinquency Ratio exceeds %;
(viii) if on any Payment Date, the Cumulative Realized Loss Percentage exceeds the following percentages on any Payment Date during the following periods: __________ - __________ ____ % __________ - __________ ____ % __________ - __________ ____ % __________ and in each and every such case, so thereafter ____ %
(ix) the occurrence of an Event of Default under the Indenture. So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Delinquency Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Payment Date, the Indenture Trustee, upon receipt of written notice or discovery actual knowledge by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct Indenture Trustee may, and upon request of the Trustee to Holders representing more than 50% of the Class Note Balance, shall, terminate all of the rights and obligations of the Servicer under this Agreement Agreement, except for the Servicer’s indemnification obligation under Section 5.19, and the Successor Servicer Indenture Trustee (if it is the successor servicer) or a successor servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Delinquency Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest as provided in Section 7.02 and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (xii) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) aboveMajority Noteholders, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the SellerServicer and a Responsible Officer of the Indenture Trustee, the Servicerand in addition to whatever rights such Noteholders may have at law or equity to damages, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer; and (z) with respect to clauses (vii)-(ix) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee shall, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to another successor servicer, and under this Section 8.01; and, without limitation, the Successor Servicer another successor servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and to pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee or another successor servicer in effecting the termination of the Servicer’s responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer another successor servicer, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with The Indenture Trustee shall promptly notify the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of DefaultDefault upon discovery or receipt of notice by a Responsible Officer of the Indenture Trustee; provided, however, the Servicer Indenture Trustee shall act as Servicer under this Agreement, subject not be obligated to monitor the right Servicer’s compliance with the terms hereof or to determine the occurrence of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such any Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminatedDefault.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Sale and Servicing Agreement (Accredited Mortgage Loan REIT Trust), Sale and Servicing Agreement (Accredited Mortgage Loan REIT Trust)
Servicer Events of Default. (a) If any one of the The following events (“and conditions shall constitute Servicer Events of Default”) shall occur and be continuingDefault hereunder:
(i) (A) The failure by on the Servicer to make any Monthly Advance which continues unremedied for a period part of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in to the Collection Account, Residual Account or other applicable account in accordance with the Distribution Account terms of the Indenture within three Business Days following the receipt thereof any deposit monies received by the Servicer (including, without limitation, any Lease Payments and any Non-Performing Lease Payments) and required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was duedeposited hereunder;
(ii) (A) The so long as the Transferor is the Servicer hereunder, failure on the part of the Transferor to pay to the Trustee on the date when due in accordance with the terms hereof, any payment required to be made by the Transferor pursuant to Section 4 hereof;
(iii) failure on the part of either the Servicer or (so long as the Transferor is the Servicer) the Transferor to make observe or perform in any required material respect any other of their respective covenants or agreements in this Assignment and Servicing Advance Agreement which failure continues unremedied for a period of sixty 30 days after the earlier of (60A) daysthe date it first becomes known to any officer of the Transferor or the Servicer, or as the case may be, and (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, thereof requiring the same to be remedied, remedied shall have been given to the Servicer Transferor or the Servicer, as the case may be, by the Master ServicerTrustee, the Securities Administrator or the Trustee or to the Servicer Transferor or the Servicer, as the case may be, and the Master Servicer, the Securities Administrator or the Trustee, Trustee by any Holder holder of the Notes;
(iv) if any representation or warranty made by the Transferor in this Assignment and Servicing Agreement or in any certificate or other writing delivered pursuant hereto or made by any successor Servicer in connection with Certificates evidencing Voting Rights such successor Servicer's assumption of at least 25%the duties of the Servicer shall prove to be incorrect in any material respect as of the time when the same shall have been made; provided, however, that the breach of any representation or warranty made by the Transferor or Servicer in this Assignment and Servicing Agreement will be deemed to be "material" only if it affects the case of a failure that cannot be cured within sixty (60) daysNoteholders, the cure period may be extended enforceability of the Indenture or of the Notes; and provided, further, that a material breach of any representation or warranty made by the Transferor in this Assignment and Servicing Agreement with respect to any of the Leases or the Equipment subject thereto will not constitute a Servicer Event of Default if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Transferor purchases such Lease and the Trustee that the Servicer is diligently pursuing remedial actionEquipment in accordance with this Assignment and Servicing Agreement;
(iiiv) The filing of a petition against the Servicer in entry by a court or agency or supervisory authority having jurisdiction in the premises of (A) a decree or order for relief in respect of the appointment Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) a decree or order adjudging the Servicer bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment, or composition of or in respect of the Servicer under any applicable federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of the Servicer or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of thirty (30) 60 consecutive days; or;
(ivvi) The the commencement by the Servicer shall voluntarily go into liquidationof a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order for relief in respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by it of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or failure by the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; orsuch action;
(vii) any reduction or withdrawal of the ratings failure of the Servicer as a servicer of subprime mortgage loans by to make one or more payments due with respect to aggregate recourse debt or other obligations exceeding $5,000,000, or the occurrence of any event or the existence of any condition, the effect of which event or condition is to cause (or permit one or more persons to cause) more than $5,000,000 of aggregate recourse debt or other obligations of the Rating Agencies that maintains a servicer rating system Servicer to become due before its (or their) stated maturity or before its (or their) regularly scheduled dates of payment so long as such failure, event or condition shall be continuing and a rating on shall not have been waived by the Certificates Person or Persons entitled to “below average” or belowperformance; or
(viii) a final judgment or judgments (or decrees or orders) for the failure by the Servicer to comply, within the required time periods, with Section 3.09 payment of money aggregating in excess of $5,000,000 and any one of such judgments (or the certification described under Section 3.10;
(ixdecrees or orders) the failure by the Servicer to provide, within the time frame specified herein, has remained unsatisfied and in effect for any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen 60 consecutive days after the date on which written notice without a stay of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreementexecution.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Assignment and Servicing Agreement (Copelco Capital Funding LLC 99-B), Assignment and Servicing Agreement (Copelco Capital Funding LLC 2000-A)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2025-A Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2025-A Exchange Note or to this 2025-A Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2025-A Exchange Note under the Basic Servicing Agreement or this 2025-A Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2025-A Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2025-A Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2025-A Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2025-A Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2025-A Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2025-A Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2025-A Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2025-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementA Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2025-A Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the written direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2025-A Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the written direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2025-A Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitationSection, the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2025-A Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2025-A Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2025-A Leases and other reasonable out2025-of-pocket costs A Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2025-A Leases and transferring the Mortgage Files 2025-A Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2025-A), Servicing Supplement (Mercedes-Benz Auto Lease Trust 2025-A)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2019-B Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2019-B Exchange Note or to this 2019-B Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2019-B Exchange Note under the Basic Servicing Agreement or this 2019-B Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2019-B Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2019-B Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2019-B Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2019-B Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2019-B Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2019-B Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2019-B Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2019-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementB Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2019-B Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2019-B Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2019-B Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitation7.01(a), the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2019-B Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2019-B Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2019-B Leases and other reasonable out2019-of-pocket costs B Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2019-B Leases and transferring the Mortgage Files 2019-B Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: 2019 B Servicing Supplement (Mercedes-Benz Auto Lease Trust 2019-B), 2019 B Servicing Supplement (Mercedes-Benz Auto Lease Trust 2019-B)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2018-B Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2018-B Exchange Note or to this 2018-B Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2018-B Exchange Note under the Basic Servicing Agreement or this 2018-B Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2018-B Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2018-B Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2018-B Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2018-B Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2018-B Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2018-B Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2018-B Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2018-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementB Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2018-B Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2018-B Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2018-B Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitation7.01(a), the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2018-B Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2018-B Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2018-B Leases and other reasonable out2018-of-pocket costs B Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2018-B Leases and transferring the Mortgage Files 2018-B Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses.
(e) Notwithstanding Section 7.01(d), if the Indenture Trustee shall be unwilling so to act or if it is legally unable so to act, a Successor Servicer shall be appointed in accordance with Section 8.04 of the Basic Servicing Agreement. If Compensation for any Successor Servicer shall not be greater than that payable to MBFS USA as initial Servicer hereunder without the predecessor prior consent of the Majority Noteholders of the Controlling Class (or Holders of Certificates representing not less than 51% of the aggregate Certificate Percentage Interests then outstanding if the Notes are no longer Outstanding). The Indenture Trustee and such successor shall take such action, consistent with this 2018-B Servicing Supplement, as shall be necessary to effectuate any such succession. The Indenture Trustee shall not be relieved of its duties as Successor Servicer is required but fails under this Section until a newly appointed Servicer shall have assumed the obligations and duties of the terminated Servicer under this 2018-B Servicing Supplement. Notwithstanding anything to pay the amounts specified contrary contained herein, in no event shall the Indenture Trustee be liable for any servicing fee or for any differential in the preceding sentence and such amounts are amount of the servicing fee paid by the Trusthereunder, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action amount necessary to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding induce any termination of the activities of the Successor Servicer to act as Successor Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion responsibilities of the Servicing Fees to which the Servicer would have been entitled set forth in Sections 3.05 and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination 3.10 hereunder, or the obligations with respect to events occurring prior to such termination.
the payment or reimbursement of fees, expenses or other amounts (cincluding indemnities other than those resulting from the actions of the Indenture Trustee as successor Servicer) Upon of the occurrence of a Servicer Event of DefaultOwner Trustee, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Indenture Trustee or the Securities Administrator to direct Asset Representations Reviewer, the Master Servicer to remove) fees and expenses of the Servicer pursuant to clause (b) above. In Owner Trustee’s attorneys, the event Indenture Trustee’s attorneys, or the Master Servicer fails to deliver an Extension Notice prior Asset Representations Reviewer’s attorneys, the fees and expenses of any custodian and the fees and expenses of independent accountants or expenses incurred in connection with distributions and reports to the end of any Servicer Term of Service, the Servicer shall be automatically terminatedNoteholders.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2018-B), Servicing Supplement (Mercedes-Benz Auto Lease Trust 2018-B)
Servicer Events of Default. (a) If any one of the The following events (shall each constitute a “Servicer Events Event of Default”) shall occur and be continuing” hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below and Delinquency Advances, which shall have no cure period), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and Indenture Trustee by the Master Servicer, the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25%; provided, however, provided however that any failed remittance cured within one Business Day of such failure shall include interest accrued at the Prime Rate (as set forth in the case Wall Street Journal) on the amount of a failure that cannot such remittance from and including the date the remittance was required to be cured within sixty (60) days, made to and including the cure period may be extended if date the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial actionremittance was actually made;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Indenture Trustee or to the 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 Servicer duly to observe or perform in any material respect any other of the covenants or agreements on the part of the 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 Servicer by the Indenture Trustee or to the 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 Servicer and such decree or order shall have remained in force, undischarged or unstayed for a period of ninety (90) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer; or’s property;
(vi) the 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 [ ]%;
(ix) if on any Payment Date, the Cumulative Loan Loss Percentage exceeds the following percentages on any Payment Date during the following periods: [MO/YR] - [MO/YR] [___ ]% [MO/YR] - [MO/YR] [___ ]% [MO/YR] - [MO/YR] [___ ]% [MO/YR] and thereafter [___ ]%
(x) the identification occurrence of an Event of Default under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so Indenture. So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Delinquency Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Payment Date, the Indenture Trustee, upon receipt of written notice or discovery actual knowledge by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and to the Master Servicer shall direct Note Insurer, and the Indenture Trustee to 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 Servicer under this Agreement and Agreement, except for the Successor Servicer Servicer’s indemnification obligation under Section 5.19, the Indenture Trustee (if it is the successor servicer) or a successor servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Delinquency Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest as provided in Section 7.02 and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (vii) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all Note Insurer or the Majority Noteholders, by notice in writing to the Servicer and a Responsible Officer of the Voting Rights) Indenture Trustee and subject to the prior written consent of the Note Insurer in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, any removal at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given Majority Noteholders, and in writing addition to the Sellerwhatever rights such Noteholders may have at law or equity to damages, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer; and (z) with respect to clauses (vii)-(ix) of Section 7.01(a), 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 Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in another successor servicer selected by the Successor Servicer pursuant to Note Insurer, and under this Section 8.01; and, without limitation, the Successor Servicer another successor servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and to pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator Indenture Trustee and the Trustee another successor servicer in effecting the termination of the Servicer’s responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer another successor servicer, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Note Insurer and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of DefaultDefault upon discovery or receipt of notice by a Responsible Officer of the Indenture Trustee; provided, however, the Servicer Indenture Trustee shall act as Servicer under this Agreement, subject not be obligated to monitor the right Servicer’s compliance with the terms hereof or to determine the occurrence of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such any Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminatedDefault.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 2 contracts
Sources: Sale and Servicing Agreement (Accredited Mortgage Loan REIT Trust), Sale and Servicing Agreement (Accredited Mortgage Loan REIT Trust)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2012-A Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2012-A Exchange Note or to this 2012-A Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2012-A Exchange Note under the Basic Servicing Agreement or this 2012-A Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2012-A Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2012-A Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2012-A Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2012-A Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2012-A Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of certain Insolvency Events with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2012-A Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2012-A Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2012-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementA Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2012-A Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2012-A Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2012-A Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf terms of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwiseBasic Servicing Agreement. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2012-A Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2012-A Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans2012-A Leases and 2012-A Vehicles and all information or documents that the Indenture Trustee or such Successor Servicer may require. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of In addition, the Servicer shall transfer its electronic records relating to the 2012-A Leases and transferring the Mortgage Files 2012-A Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(ce) Upon Notwithstanding Section 7.01(d), if the occurrence of Indenture Trustee shall be unwilling so to act or if it is legally unable so to act, a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Successor Servicer shall be designated appointed in accordance with Section 8.04 of the Basic Servicing Agreement. Compensation for any Successor Servicer shall not be greater than that payable to act MBFS USA as initial Servicer hereunder, a “Servicer Term hereunder without the prior consent of Service”) until such time as the Master Servicer, Majority Noteholders of the Securities Administrator and the Trustee receives written direction from the Controlling Class (or Holders of Certificates evidencing at least representing not less than 51% of the Voting Rights not to deliver an Extension Noticeaggregate Certificate Percentage Interests then outstanding if the Notes are no longer Outstanding). The Indenture Trustee and such successor shall take such action, in which event the Master Servicer shall follow such direction; provided that nothing in consistent with this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service2012-A Servicing Supplement, the Servicer as shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds necessary to the obligations of Servicer hereunder, the term of the Successor Servicer or effectuate any such Person succession. The Indenture Trustee shall not be limited unless and relieved of its duties as Successor Servicer under this Section until a newly appointed Servicer Event shall have assumed the obligations and duties of Default thereafter occurs with respect the terminated Servicer under this 2012-A Servicing Supplement. Notwithstanding anything to such the contrary contained herein, in no event shall the Indenture Trustee be liable for any servicing fee or for any differential in the amount of the servicing fee paid hereunder and the amount necessary to induce any Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting act as Successor Servicer and the Person then-obligated to succeed such then-acting Servicerhereunder.
Appears in 2 contracts
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2012-A), Servicing Supplement (Mercedes-Benz Auto Lease Trust 2012-A)
Servicer Events of Default. (a) If any In case one or more of the following events (“Servicer Events of Default”) Default shall occur and be continuing, that is to say:
(i1) (A) The any failure by Servicer to deposit into the Collection Account or the Distribution Account or any failure by the Servicer to make payments therefrom in accordance with Section 5.01 hereof; or
(2) any Monthly Advance failure on the part of the Servicer duly to observe or perform in any material respect any other of the material covenants or agreements on the part of the Servicer, contained in any Basic Document to which it is a party, which continues unremedied for a period of one 30 days (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit or, in the Collection Account or the Distribution Account any deposit required to be made under the terms case of this Agreement which continues unremedied payment of insurance premiums, for a period of two (215 days) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Trustee any other party hereto or to the Servicer and (with copy to each other party hereto), by Holders of 25% of the Master Servicer, Percentage Interests of the Securities Administrator Notes or the TrusteeTrust Certificates; or
(3) any breach on the part of the Servicer of any representation or warranty contained in any Basic Document to which it is a party that materially and adversely affects the interests of any of the parties hereto or any Securityholder and which continues unremedied for a period of 30 days after the date on which notice of such breach, requiring the same to be remedied, shall have been given to the Servicer by any other party hereto or to the Servicer (with copy to each other party hereto), by any Holder with Certificates evidencing Voting Rights the Noteholder Agent or Holders of at least 25%; provided, however, that % of the Percentage Interests (as defined in the case of a failure that cannot be cured within sixty (60Indenture) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;Notes; or
(iii4) The filing of a petition against the Servicer in there shall have been commenced before a court or agency or supervisory authority having jurisdiction in the premises for an involuntary proceeding against the appointment of a trusteeServicer under any present or future federal or state bankruptcy, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities insolvency or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises law for the appointment of a conservator, receiver, liquidator liquidator, trustee or similar person official in any bankruptcy, insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, which action shall not have been entered against dismissed for a period of 60 days; or
(5) the ServicerServicer shall consent to the appointment of a conservator, receiver, liquidator, trustee or similar official in any bankruptcy, insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to it or of or relating to all or substantially all of its property; or
(6) the Servicer (or the Loan Originator if the Servicer is not Option One) fails to comply with the Financial Covenants; or
(7) the Servicer ceases to be a 100% direct or indirect wholly-owned subsidiary of H&R Block Inc.; or
(8) the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or creditors, voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) , or take any reduction or withdrawal corporate action in furtherance of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) thenforegoing. Then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failureMajority Noteholders, the Master Servicer shall give telephonic by notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure in writing to make a Monthly Advance to a Servicing Officer of the Servicer andmay, in addition to the extent the applicable current contact information has been provided whatever rights such Person may have at law or in equity to the Master Servicerdamages, the Servicing Rights Pledgee including injunctive relief and (2) on the Business Day immediately following the related Deposit Datespecific performance, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to may terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior and to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee Loans and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) aboveproceeds thereof, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 9.02 hereof, pass to and be vested in a successor servicer, and the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer successor servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each Mortgage Loan the Loans and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee successor servicer in effecting the termination of the Servicer's responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer successor servicer for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the each Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(cb) Upon the occurrence of (i) an Event of Default or Default under any of the Basic Documents, (ii) a Servicer Event of Default, the Servicer shall act as Servicer Default under this Agreement, subject (iii) a Rapid Amortization Trigger or (iv) an event that shall have a reasonable possibility of materially impairing the ability of the Servicer to service and administer the right of removal Loans in accordance with the terms and provisions set forth in subsection the Basic Documents (b) hereofeach, a "Term Event"), the Servicer's right to service the Loans pursuant to the terms of this Agreement shall be in effect for an initial period commencing on the date on which such Servicer Term Event of Default occurred and ending shall automatically terminate at 5:00 p.m. New York City time, on the last Business Day of the calendar month in which such Term Event occurred (the "Initial Term"). Thereafter, the Initial Term shall be extendible in the sole discretion of the Majority Noteholders by written notice (each, a "Servicer Extension Notice") of the Noteholders for successive one-month terms (each such term ending at 5:00 p.m. New York City time, on the last business day of the calendar quarter in which such related month). Following a Term Event, the Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which hereby agrees that the Servicer shall be designated bound for the duration of the Initial Term and the term covered by any such Servicer Extension Notice to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) abovethis Agreement. In Following a Term Event, the event Servicer agrees that if, as of 3:00 p.m. New York City time on the Master Servicer fails to deliver an Extension Notice prior to the end last Business Day of any Servicer Term of Servicemonth, the Servicer shall be automatically terminated.
(d) If not have received a Servicer Extension Notice from the Successor Majority Noteholders, the Servicer or another Person succeeds shall give written notice of such non-receipt to the obligations of Servicer hereunderNoteholders by 4:00 p.m. New York City time. Following a Term Event, the term failure of the Successor Servicer or such Person shall not be limited unless and until Noteholders, to deliver a Servicer Event Extension Notice by 5:00 p.m. New York City time shall result in the automatic and immediate termination of Default thereafter occurs with respect to such Successor the Servicer or other Person(the "Termination Date"). At such timeNotwithstanding these time frames, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated Noteholders shall comply with all applicable laws in connection with such transfer and the Servicer shall continue to succeed service the Loans until completion of such then-acting Servicertransfer.
Appears in 1 contract
Servicer Events of Default. (a) If any one Any of the following events (“acts or occurrences shall constitute a Servicer Events Event of Default”) shall occur and be continuing:
(i) any failure by the Servicer to deliver to the Trustee for payment to Noteholders any proceeds or payments received from a Customer or in respect of the Trust Estate and required to be so delivered under the terms of the Indenture and this Agreement that continues unremedied until 10:00 a.m., Minneapolis time, for two Business Days; provided, however, that the Trustee, upon receiving actual knowledge of such failure, shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(Aii) The any failure by the Servicer to deliver a Monthly Servicer's Report pursuant to Section 4.01 hereof that continues unremedied until 10:00 a.m., Minneapolis time, the Business Day following the date delivery is required; provided, however, that if the Servicer has not delivered the Monthly Servicer's Report by 12:00 noon, Minneapolis time, on the Determination Date, the Trustee shall give the Servicer notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prohibit the occurrence of a Servicer Event of Default; or
(iii) any failure by the Servicer to make a Servicer Advance pursuant to Section 3.04 hereof or to deposit any Purchase Price received by it that continues unremedied until 10:00 a.m., Minneapolis time, the following Business Day following the date delivery is required; provided, however, that if the Servicer has not made the Servicer Advance or deposited any Purchase Price received by it by 12:00 noon, Minneapolis time, on the Determination Date and the Trustee has received written notification from the Servicer by way of the Monthly Servicer's Report or otherwise that such Servicer Advance or Purchase Price is to be paid, the Trustee shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(iv) any failure by the Servicer to make remittances or deliver notices pursuant to Section 3.03 hereof, that continues unremedied until 10:00 a.m., Minneapolis time, of the third successive Business Day; or
(v) any failure on the part of the Servicer duly to observe or perform any other covenants or agreements of the Servicer set forth in this Agreement or the Indenture, as the case may be, or any representation or warranty of the Servicer set forth in Section 2.01 of this Agreement shall prove to be incorrect in any material respect, which failure or breach continues unremedied for a period of one thirty (130) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, days after the date on which the Servicer becomes aware of such failure or breach, or written notice of such failurefailure or breach, requiring the same situation giving rise to such breach or non-conformity to be remedied, shall have been given to a Servicing Officer of the Servicer by the Master Servicer, the Securities Administrator Trustee or the Trustee Issuer or to a Servicing Officer of the Servicer and the Master ServicerTrustee by Holders of Notes representing not less than 25% of the aggregate principal amount of the Notes Outstanding; or
(vi) any assignment by the Servicer to a delegate of its duties or rights under this Agreement, except as specifically permitted hereunder, or any attempt to make such an assignment; or
(vii) the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case entry of a failure that cannot be cured within sixty (60) days, the cure period may be extended if decree or order for relief by a court having jurisdiction in respect of the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of or a petition against the Servicer in an involuntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy, insolvency or similar law, or appointing a court receiver, liquidator, assignee, trustee, custodian, sequestrator or agency or supervisory authority having jurisdiction in the premises other similar official for the appointment Servicer or for any substantial part of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingsits property, or for ordering the winding up or liquidation of its affairs, the affairs of the Servicer and the continuance of any such decree or order unstayed and in effect effect, or failure for such petition to be dismissed, for a period of thirty (30) 60 consecutive days; or
(ivviii) The the commencement by the Servicer shall voluntarily go into liquidationof a voluntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy, insolvency, reorganization or similar law, or the consent by the Servicer to the appointment of or taking possession by a conservator conservator, receiver, liquidator, assignee, trustee, custodian, sequestrator or receiver or liquidator or other similar person official in any insolvency, readjustment of debt, marshaling marshalling of assets and liabilities liabilities, bankruptcy or similar proceedings of or relating to the Servicer or of or relating to all or substantially all a substantial part of its property, or a decree or order the making by the Servicer of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up failure by the Servicer generally to pay its debts as such debts become due or liquidation of its affairs, shall have been entered against the Servicer; or if the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing taking of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure corporate action by the Servicer to comply, within in furtherance of any of the required time periods, with Section 3.09 or the certification described under Section 3.10;foregoing; or
(ix) the failure by occurrence of a Trigger Event if the initial Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with is the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall not have been remediedremedied within the period set forth in subparagraphs (i), (xii), (iii), (iv), (v) with respect solely to clause or (a)(i)(Avii) above, as applicable, the Trustee shall, by notice (1the "Servicer Termination Notice") on given in writing to the related Deposit DateServicer, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer terminate all, but not less than all, of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer rights and obligations of the Servicer andunder this Agreement. Notwithstanding the foregoing, to the extent the applicable current contact information has a delay in or failure of performance under Sections 6.01(a)(ii) or 6.01(a)(v) hereof for a period of 30 or more days shall not constitute a Servicer Event of Default if such delay or failure could not have been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery prevented by the Master Servicer or a Responsible Officer exercise of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of reasonable diligence by the Servicer and such delay or failure was caused by acts of declared or undeclared war, public disorder, rebellion or sabotage, epidemics, landslides, lightning, fire, hurricanes, earthquakes, floods or similar causes; provided, however, that in any event, such delay or failure shall constitute a Servicer Event of Default if it continues unremedied for a period of thirty (30) days. The preceding sentence shall not relieve the Master Servicer shall direct from using its best efforts to perform its obligations in a timely manner in accordance with the terms of this Agreement.
(c) In the event of the occurrence of a Trigger Event, the Trustee may, and if directed by Holders of Notes representing at least 66-2/3% of the aggregate amount of Notes Outstanding, shall, by a Servicer Termination Notice given in writing to the Servicer, terminate all but not less than all of the rights and obligations of the Servicer under this Agreement.
(d) In the event that Sunrise Leasing Corporation resigns or is terminated as Servicer pursuant to this Agreement and the Successor a successor Servicer is appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assumehereunder, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51Notes representing at least 66-2/3% of all the aggregate amount of the Voting Rights) Notes Outstanding may direct the Trustee to, and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights terminate, by notice then a Servicer Termination Notice given in writing to the Seller, the such successor Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all but not less than all of the rights and obligations of the such successor Servicer as servicer under this Agreement. Agreement and appoint a new successor Servicer which has been approved by such Holders.
(e) On or after the receipt by the Servicer of such written noticea Servicer Termination Notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates Notes or the Mortgage Loans Lease Contracts or otherwise, otherwise shall pass to and be vested in the Successor successor Servicer appointed pursuant to and under this Section 8.01; 6.02 hereof, and, without limitation, the Successor such successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan the Lease Contracts and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator Trustee and the Trustee successor Servicer in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to Lease Contracts. To assist the Mortgage Loans. All Servicing Transfer Costs successor Servicer in enforcing all rights under the Lease Contracts and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files Insurance Polices to the Successor extent they relate to the Lease Contracts, the outgoing Servicer, at its own expense, shall transfer its records (electronic and otherwise) relating to such Lease Contracts to the successor Servicer in such form as the successor Servicer may reasonably request and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by transfer the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, related Lease Contracts (to the extent not paid held by the predecessor ServicerTrustee) and all other records, by correspondence and documents relating to the Trust prior Lease Contracts that it may possess to distributions to Certificateholders (or, if the predecessor successor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence manner and at such amounts are paid by times as the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the successor Servicer shall continue reasonably request. In addition to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer any other amounts that are then payable to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated entitled to act as receive reimbursements for any unreimbursed Servicer hereunder, a “Servicer Term of Service”) until such time as Advance made during the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice period prior to the end delivery of any a Servicer Term Termination Notice pursuant to this Section 6.01 which terminates the obligations and rights of Service, the Servicer shall be automatically terminatedunder this Agreement.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Servicer Events of Default. (a) If any In case one or more of the following events (“Servicer Events of Default”) Default shall occur and be continuing, that is to say:
(i1) (A) The any failure by Servicer to deposit into the Collection Account or the Distribution Account or any failure by the Servicer to make payments therefrom in accordance with Section 5.01; or
(2) any Monthly Advance failure on the part of the Servicer duly to observe or perform in any material respect any other of the material covenants or agreements on the part of the Servicer, contained in any Basic Document to which it is a party, which continues unremedied for a period of one 30 days (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit or, in the Collection Account or the Distribution Account any deposit required to be made under the terms case of this Agreement which continues unremedied payment of insurance premiums, for a period of two (215 days) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Trustee any other party hereto or to the Servicer and (with copy to each other party hereto), by Holders of 25% of the Master Servicer, Percentage Interests of the Securities Administrator Notes or the TrusteeTrust Certificates; or
(3) any breach on the part of the Servicer of any representation or warranty contained in any Basic Document to which it is a party that materially and adversely affects the interests of any of the parties hereto or any Securityholder and which continues unremedied for a period of 30 days after the date on which notice of such breach, requiring the same to be remedied, shall have been given to the Servicer by any other party hereto or to the Servicer (with copy to each other party hereto), by any Holder with Certificates evidencing Voting Rights the Noteholder Agent or Holders of at least 25%; provided, however, that % of the Percentage Interests (as defined in the case of a failure that cannot be cured within sixty (60Indenture) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;Notes; or
(iii4) The filing of a petition against the Servicer in there shall have been commenced before a court or agency or supervisory authority having jurisdiction in the premises for an involuntary proceeding against the appointment of a trusteeServicer under any present or future federal or state bankruptcy, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities insolvency or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises law for the appointment of a conservator, receiver, liquidator liquidator, trustee or similar person official in any bankruptcy, insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, which action shall not have been entered against dismissed for a period of 60 days; or
(5) the ServicerServicer shall consent to the appointment of a conservator, receiver, liquidator, trustee or similar official in any bankruptcy, insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to it or of or relating to all or substantially all of its property; or
(6) the Servicer (or the Loan Originator if the Servicer is not Option One) fails to comply with the Financial Covenants; or
(7) the Servicer ceases to be a 100% indirect wholly-owned subsidiary of H&R Block Inc.; or
(8) the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or creditors, voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) , or take any reduction or withdrawal corporate action in furtherance of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) thenforegoing. Then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failureMajority Noteholders, the Master Servicer shall give telephonic by notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure in writing to make a Monthly Advance to a Servicing Officer of the Servicer andmay, in addition to the extent the applicable current contact information has been provided whatever rights such Person may have at law or in equity to the Master Servicerdamages, the Servicing Rights Pledgee including injunctive relief and (2) on the Business Day immediately following the related Deposit Datespecific performance, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to may terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior and to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee Loans and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) aboveproceeds thereof, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 9.02 hereof, pass to and be vested in a successor servicer, and the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer successor servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each Mortgage Loan the Loans and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee successor servicer in effecting the termination of the Servicer’s responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer successor servicer for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the each Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(cb) Upon the occurrence of (i) an Event of Default or Default under any of the Basic Documents, (ii) a Servicer Event of Default, the Servicer shall act as Servicer Default under this Agreement, subject (iii) a Rapid Amortization Trigger or (iv) an event that shall have a reasonable possibility of materially impairing the ability of the Servicer to service and administer the right of removal Loans in accordance with the terms and provisions set forth in subsection the Basic Documents (b) hereofeach, a “Term Event”), the Servicer’s right to service the Loans pursuant to the terms of this Agreement shall be in effect for an initial period commencing on the date on which such Servicer Term Event of Default occurred and ending shall automatically terminate at 5:00 p.m., New York City time, on the last day Business Day of the calendar quarter month in which such Term Event occurred (the “Initial Term”). Thereafter, the Initial Term shall be extendible in the sole discretion of the Majority Noteholders by written notice (each, a “Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) of the Noteholders for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year successive one-month terms (each such quarterly period for which term ending at 5:00 p.m., New York City time, on the last business day of the related month). Following a Term Event, the Servicer hereby agrees that the Servicer shall be designated bound for the duration of the Initial Term and the term covered by any such Servicer Extension Notice to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) abovethis Agreement. In Following a Term Event, the event Servicer agrees that if, as of 3:00 p.m. New York City time on the Master Servicer fails to deliver an Extension Notice prior to the end last Business Day of any Servicer Term of Servicemonth, the Servicer shall be automatically terminated.
(d) If not have received a Servicer Extension Notice from the Successor Majority Noteholders, the Servicer or another Person succeeds shall give written notice of such non-receipt to the obligations of Servicer hereunderNoteholders by 4:00 p.m. New York City time. Following a Term Event, the term failure of the Successor Servicer or such Person shall not be limited unless and until Noteholders, to deliver a Servicer Event Extension Notice by 5:00 p.m. New York City time shall result in the automatic and immediate termination of Default thereafter occurs with respect to such Successor the Servicer or other Person(the “Termination Date”). At such timeNotwithstanding these time frames, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated Noteholders shall comply with all applicable laws in connection with such transfer and the Servicer shall continue to succeed service the Loans until completion of such then-acting Servicertransfer.
Appears in 1 contract
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2017-A Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2017-A Exchange Note or to this 2017-A Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2017-A Exchange Note under the Basic Servicing Agreement or this 2017-A Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2017-A Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2017-A Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2017-A Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2017-A Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2017-A Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2017-A Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2017-A Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2017-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementA Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2017-A Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2017-A Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2017-A Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitation7.01(a), the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2017-A Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2017-A Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2017-A Leases and other reasonable out2017-of-pocket costs A Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2017-A Leases and transferring the Mortgage Files 2017-A Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2017-A)
Servicer Events of Default. (a) If any one of the The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer and the Note Insurer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders of Notes evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(iii) any failure on the part of the Servicer duly to observe or perform in any material respect any other of the covenants or agreements on the part of the 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 Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(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 Servicer and such decree or order shall have remained in force, undischarged or unstayed for a period of sixty (60) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer's property;
(vi) the 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 Distribution Date the Rolling Six Month Delinquency Rate exceeds 12.75% of the aggregate outstanding Principal Balance for the Mortgage Loans;
(ix) if on any Distribution Date, commencing in March 2000, the Twelve Month Loss Amount exceeds 1.75% of the aggregate outstanding Principal Balance for the Mortgage Loans, as of the close of business on the first day of the twelfth preceding calendar month;
(x) if (a) on any Distribution Date occurring before March 1, 2000, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 1.00% of the Original Pool Principal Balance, (b) on any Distribution Date on or after March 1, 2000 and before March 1, 2001, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 1.50% of the Original Pool Principal Balance, (c) on any Distribution Date on or after March 1, 2001 and before March 1, 2002, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 2.25% of the Original Pool Principal Balance, (d) on any Distribution Date on or after March 1, 2002 and before December 1, 2003, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 3.00% of the Original Pool Principal Balance, or (e) on any Distribution Date on or after March 1, 2003, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 3.75% of the Original Pool Principal Balance;
(xi) the occurrence of an Event of Default under the Indenture; or
(xxii) the identification under any filing pursuant to a Servicer Extension Notice shall not have been delivered as set forth in Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement8.04 hereof.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Periodic Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Distribution Date, the Indenture Trustee, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and to the Master Servicer shall direct Note Insurer and the Indenture Trustee to shall, with the consent of the Note Insurer, terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Indenture Trustee, or a successor Servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Periodic Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor Servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (vii) of Section 7.01, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all Note Insurer or the Majority Noteholders, by notice in writing to the Servicer and a Responsible Officer of the Voting Rights) Indenture Trustee and subject to the prior written consent of the Note Insurer, in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, any removal at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given Majority Noteholders, and in writing addition to the Sellerwhatever rights such Noteholders may have at law or equity to damages, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this AgreementAgreement and in and to the Mortgage Loans and the proceeds thereof, as servicer; and (z) with respect to clauses (viii)-(x) of Section 7.01(a), the Indenture Trustee shall, but only at the direction of the Note Insurer, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to Indenture Trustee, or its designee approved by the Note Insurer, and under this Section 8.01; and, without limitation, the Successor Servicer Indenture Trustee is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the Servicer's responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer Indenture Trustee, or its designee, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Note Insurer and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Prudential Securities Secured Financing Corp)
Servicer Events of Default. Each of the following shall constitute a “Servicer Event of Default” on the part of the Servicer:
(a) If any one of the following events (“Servicer Events of Default”) shall occur and be continuing:
(i) (A) The failure by the Servicer to make any Monthly Advance which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by remit to the Servicer to deposit in the Collection Account Purchaser or the Distribution Account Junior Participation Holder any deposit payment required to be made under the terms of this Agreement which continues unremedied for a period of two five (25) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Purchaser and/or the Junior Participation Holder; or
(b) any failure to materially perform any of its other duties under this Agreement for a period in excess of thirty (30) days following the date of Servicer, the Securities Administrator ’s receipt of written notice from Purchaser or the Trustee or to Junior Participation Holder, notifying Servicer of the Servicer existence of and specifying in reasonable detail the Master Servicer, nature of the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%default; provided, provided however, that in if the case default is of a failure nature that cannot reasonably be cured within sixty thirty (30) days, Servicer shall have such additional time as may be reasonable and necessary within which to cure such default (provided however, such additional time shall in no event extend beyond thirty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;); or
(iiic) The filing the second occurrence, during any twelve (12) month period, of Servicer’s failure to (1) remit any payment required under Section 10.01(a) or (2) materially perform any of its duties under this Agreement as to which notice has previously during such twelve (12) month period been given to Servicer under Section 10.01 (b); or
(d) a petition against the Servicer in decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, conservator or receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, including bankruptcy, marshaling of assets and liabilities or similar proceedings, or for the winding winding-up or liquidation of its affairs, shall have been entered against the Servicer and the continuance of any such decree or order shall have remained in force undischarged or unstayed and in effect for a period of thirty sixty (3060) consecutive days; or
(ive) The the Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order the property of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or or
(f) the Servicer shall fail to pay, or shall admit in writing its inability to pay pay, its debts generally as they become due, file a petition to take advantage of any applicable bankruptcyinsolvency, insolvency bankruptcy or reorganization statute, statute or make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in creditors. In each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely in addition to clause (a)(i)(A) abovewhatsoever rights the Purchaser or the Junior Participation Holder may have at law or equity, (1) on the related Deposit Dateincluding, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failurewithout limitation, seeking damages, including injunctive relief and specific performance, the Master Servicer shall give telephonic notice Purchaser (by no later than 5:00 p.m. New York time on such Deposit Date) of or the failure to make a Monthly Advance to a Servicing Officer of Junior Participation Holder only in the Servicer and, to event that the extent the applicable current contact information Senior Participation Principal Balance has been provided reduced to the Master Servicerzero), the Servicing Rights Pledgee and by five (25) on the Business Day immediately following the related Deposit Date, upon receipt of written Days’ prior notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the SellerServicer and without the payment of any termination fee, may assume the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all servicing of the rights and obligations of the Servicer as servicer under Mortgage Loans pursuant to this Agreement. On or after Upon receipt by the Servicer of such written noticenotice that Purchaser or the Junior Participation Holder is assuming the servicing of the Mortgage Loans pursuant to this Agreement, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; andPurchaser or the Junior Participation Holder, without limitationas the case may be, thereafter. In such case, upon written request from the Purchaser or the Junior Participation Holder, the Successor Servicer is hereby authorized and empowered to shall prepare, execute and deliver, on behalf of deliver to the Servicer, as attorney-in-fact or otherwise, new servicer any and all documents and other instruments, place in such new servicer’s possession all Mortgage Files, and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether including but not limited to complete the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, at the Servicer’s sole expense to the Purchaser or otherwiseJunior Participation Holder, as the case may be. The Servicer agrees to shall cooperate with the Successor ServicerPurchaser or the Junior Participation Holder, as the Master Servicercase may be, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and Servicer’s rights of the Servicer hereunder, including, including without limitation, the immediate transfer to the Successor Servicer for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Custodial Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with Notwithstanding the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (orforegoing, if the predecessor Purchaser, its Affiliate or assign becomes the Servicer is through an occurrence described in Section 4.08, so long as any thereof remain the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs Sections 10.01(b),(c),(d),(e) and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer (f) shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of no longer constitute a Servicer Event of Default. If Purchaser, its Affiliate or assignee takes over the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day servicing of the calendar quarter in which such Servicer Event of Default occurredMortgage Loans and while any thereof continues to service the Mortgage Loans pursuant hereto, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until if a Servicer Event of Default thereafter occurs with respect shall occur as to such Successor Servicer Purchaser, its Affiliate or other Person. At such timeassignee, the provisions of Section 8.01 (c) and (d) shall become applicable Junior Participation Holder may designate a reputable institutional loan servicer to the then-acting act as Servicer and the Person then-obligated to succeed such then-acting Servicerthereafter.
Appears in 1 contract
Sources: Purchase, Warranties, Participation and Servicing Agreement (LTC Properties Inc)
Servicer Events of Default. (a) If With respect to each Series, any one of the following events (“acts or occurrences shall constitute a Servicer Events Event of Default”) shall occur and be continuingDefault with respect to such Series:
(i) any failure by the Servicer to deliver to the Subservicer for payment to Noteholders any proceeds or payments received from an Obligor or in respect of the related Series Trust Estate and required to be so delivered under the terms of the Indenture and this Agreement that continues unremedied until 1:00 p.m., Chicago time, on the second successive Business Day following such failure; provided, however, that the Subservicer, upon receiving actual knowledge of such failure, shall give the Servicer and the Trustee prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Subservicer to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(Aii) The any failure by the Servicer to deliver a Monthly Servicer's Report pursuant to Section 4.01 hereof that continues unremedied until 1:00 p.m., Chicago time, the following Business Day; provided, however, that if the Trustee has actual knowledge that the Servicer has not delivered such Monthly Servicer's Report by 1:00 p.m., Chicago time, on a Determination Date, the Trustee shall give the Servicer written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(iii) any failure by the Servicer to remit any Purchase Price received by it to the Subservicer that continues unremedied until 4:00 p.m., Chicago time, the following Business Day; provided, however, that if the Servicer has not remitted any Purchase Price received by it to the Subservicer by 2:00 p.m., Chicago time, on the Determination Date and the Trustee has received written notification from the Subservicer by way of the applicable Monthly Servicer's Report or otherwise that such Purchase Price has not been paid, the Trustee shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(iv) any failure by the Servicer to make remittances (other than a remittance of Purchase Price referred to in clause (iii) above) or deliver notices pursuant to Section 3.03 hereof, that continues unremedied until 1:00 p.m., Chicago time, of the second successive Business Day; or
(v) any Monthly Advance failure on the part of the Servicer duly to observe or perform any other covenants or agreements of the Servicer set forth in this Agreement or the Indenture or the related Series Supplement, as the case may be, or any representation or warranty of the Servicer set forth in Section 2.01 of this Agreement shall prove to be incorrect in any material respect, which failure or breach continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 30 days after the date on which the Servicer becomes aware of such failure or breach, or receives written notice of such failure, requiring the same to be remedied, shall have been given to failure or breach; or
(vi) any assignment by the Servicer to a delegate of its duties or rights under this Agreement, except as specifically permitted hereunder, or any attempt to make such an assignment; or
(vii) the entry of a decree or order for relief by the Master Servicer, the Securities Administrator or the Trustee or to a court having jurisdiction in respect of the Servicer and the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in an involuntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy, insolvency or similar law, or appointing a court receiver, liquidator, assignee, trustee, custodian, sequestrator or agency or supervisory authority having jurisdiction in the premises other similar official for the appointment Servicer or for any substantial part of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingsits property, or for ordering the winding up or liquidation of its affairs, the affairs of the Servicer and the continuance of any such decree or order unstayed and in effect effect, or failure for such petition to be dismissed, for a period of thirty (30) 60 consecutive days; or
(ivviii) The the commencement by the Servicer shall voluntarily go into liquidationof a voluntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy, insolvency, reorganization or similar law, or the consent by the Servicer to the appointment of or taking possession by a conservator conservator, receiver, liquidator, assignee, trustee, custodian, sequestrator or receiver or liquidator or other similar person official in any insolvency, readjustment of debt, marshaling of assets and liabilities liabilities, bankruptcy or similar proceedings of or relating to the Servicer or of or relating to all or substantially all a substantial part of its property, or a decree or order the making by the Servicer of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up failure by the Servicer generally to pay its debts as such debts become due or liquidation of its affairs, shall have been entered against the Servicer; or if the Servicer shall admit in writing its inability to pay its their debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing taking of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure corporate action by the Servicer to comply, within in furtherance of any of the required time periods, with Section 3.09 or the certification described under Section 3.10;foregoing; or
(ix) the failure by stockholders' equity of the Servicer to provideand its consolidated subsidiaries, within the time frame specified hereindetermined in accordance with generally accepted accounting principles, any required reports or data pertaining to the Mortgage Loansas would be shown on a consolidated balance sheet for such Persons, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Serviceris below $50,000,000; or
(x) the identification under any filing pursuant to Section 404 occurrence of a Trigger Event if the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with initial Servicer is the Servicer’s ongoing evaluation ; or
(xi) the occurrence of internal controls which materially and adversely affect the Servicer’s ability to perform any a Subservicer Event of its duties under this AgreementDefault.
(b) then, and in each and every such case, so long as If a Servicer Event of Default shall not have been remedied, (x) occurred and be continuing with respect solely to clause (a)(i)(A) aboveany Series, (1) on the related Deposit DateTrustee shall, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer direction of the Trustee or Holders of Notes representing not less than 66-2/3% in principal amount of the Securities Administrator Controlling Class of Notes Outstanding of such failureSeries, the Master Servicer shall give telephonic by notice (by no later than 5:00 p.m. New York time on such Deposit Datethe "Servicer Termination Notice") of the failure given in writing to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to Series terminate all all, but not less than all, of the rights and obligations (except as expressly provided herein) of the Servicer under this Agreement with respect to such Series. Notwithstanding the foregoing, a delay in or failure of performance under Sections 6.01(a)(ii) or 6.01(a)(v) hereof for a period of 30 or more days shall not constitute a Servicer Event of Default if such delay or failure could not have been prevented by the exercise of reasonable diligence by the Servicer and such delay or failure was caused by acts of declared or undeclared war, public disorder, rebellion or sabotage, epidemics, landslides, lightning, fire, hurricanes, earthquakes, floods or similar causes; provided, however, that in any event, such delay or failure shall constitute a Servicer Event of Default if it continues unremedied for a period of 35 days. The preceding sentence shall not relieve the Successor Servicer appointed from using its best efforts to perform its obligations in a timely manner in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution terms of funds on the related Distribution Date and assumethis Agreement, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and Servicer shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to provide the Trustee, terminate all the Issuer and the Noteholders with prompt notice of such failure or delay by it or the rights and obligations Subservicer, together with a description of the Servicer as servicer under this Agreement. its efforts to so perform its obligations.
(c) [Reserved]
(d) On or after the receipt by the Servicer of such written noticea Servicer Termination Notice, all authority and power of the Servicer with respect to such Series under this Agreement, whether with respect to the Certificates Notes or the Mortgage Loans Contracts of such Series or otherwise, shall pass to and be vested in the Successor successor Servicer appointed pursuant to and under this Section 8.01; 6.02 hereof, and, without limitation, the Successor such successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the such Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan the Contracts and related documentsdocuments related to such Series, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator Trustee and the Trustee successor Servicer in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and for deposit related to be deposited by it in the Collection Accountsuch Series, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to Contracts related to such Series. To assist the Mortgage Loans. All Servicing Transfer Costs successor Servicer in enforcing all rights under such Contracts, the outgoing Servicer, at its own expense, shall transfer its records (electronic and other reasonable out-of-pocket costs and expenses (including attorneys’ feesotherwise) incurred in connection with the termination of the Servicer and transferring the Mortgage Files relating to such Contracts to the Successor successor Servicer in such form as the successor Servicer may reasonably request and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by transfer the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, related Contracts (to the extent not paid held by the predecessor ServicerTrustee) and all other records, by correspondence and documents relating to such Contracts that it may possess to the Trust prior to distributions to Certificateholders (or, if the predecessor successor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence manner and at such amounts are paid by times as the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the successor Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationreasonably request.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Servicer Events of Default. (a) If any one of the following events (“"Servicer Events of Default”") shall occur and be continuing:
(i) (A) The failure by the Servicer to make any Monthly Advance which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other Any failure by the Servicer to deposit in or credit to the Collection Account or the Distribution Account Lock-Box Accounts any deposit amount required under this Servicing Agreement to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due so deposited or (C) the failure credited by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which and such failure continues unremedied for a period of sixty three Business Days;
(60ii) daysAny failure by the Servicer to deliver to the Trustee a Servicer Report in accordance with Section 3.1 by 4:00 p.m., New York City time, on the Servicer Report Date;
(iii) Any failure by the Servicer to comply with any provision of Section 4.2;
(iv) Any failure by the Servicer to deliver to the Trustee an accountant's report in accordance with Section 3.3 or 3.4, which non-delivery shall continue unremedied for ten Business Days;
(Bv) the A Trigger Event shall have occurred which has not been cured by a Trigger Event Cure within 120 days after such Trigger Event has occurred;
(vi) Any failure by the Servicer duly to observe or perform, to perform in any material respect, respect any other covenants, obligations covenants or agreements of the Servicer as set forth in this Servicing Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied shall have continued for a period of sixty (60) days, fifteen days after the date on which earlier of (A) written notice of such failure, requiring the same to be remedied, thereof shall have been given to the Servicer by the Master Trustee or to the Servicer and the Trustee by a Noteholder or (B) discovery of such failure by the Servicer;
(vii) Any representation, warranty or statement of the Securities Administrator Servicer made in this Servicing Agreement shall prove to be incorrect in any material respect as of the time when the same shall have been made and such incorrectness shall have a material adverse effect on the collectibility of the Mortgage Loans or the ability of the Servicer to perform its obligations hereunder, and, within thirty days after the earlier of (A) written notice thereof shall have been given to the Servicer by the Trustee or to the Servicer and the Master Trustee by a Noteholder or (B) discovery of such inaccuracy by the Servicer, the Securities Administrator circumstance or the Trusteecondition in respect of which such representation, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that warranty or statement was incorrect shall not have been eliminated or otherwise cured in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial actionall material respects;
(iiiviii) The filing entry of a petition against the Servicer in decree or order for relief by a court or agency or supervisory regulatory authority having jurisdiction in respect of the premises for Servicer in an involuntary case under the federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy, insolvency, rehabilitation or similar law; the appointment of a receiver, liquidator, assignee, trustee, conservatorcustodian, receiver sequestrator or liquidator other similar official of the Servicer in respect of any insolvency, conservatorship, receivership, readjustment substantial part of debt, marshaling of assets and liabilities or similar proceedingstheir property, or the entering of an order for the winding up or liquidation of its affairs, the affairs of the Servicer and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) sixty consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order the commencement of a court or agency or supervisory authority having jurisdiction in an involuntary case under the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) federal bankruptcy laws with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.to
Appears in 1 contract
Sources: Servicing Agreement (Sunterra Corp)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2013-A Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2013-A Exchange Note or to this 2013-A Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2013-A Exchange Note under the Basic Servicing Agreement or this 2013-A Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2013-A Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2013-A Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2013-A Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2013-A Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2013-A Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of certain Insolvency Events with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2013-A Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2013-A Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2013-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementA Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2013-A Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2013-A Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2013-A Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf terms of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwiseBasic Servicing Agreement. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2013-A Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2013-A Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans2013-A Leases and 2013-A Vehicles and all information or documents that the Indenture Trustee or such Successor Servicer may require. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of In addition, the Servicer shall transfer its electronic records relating to the 2013-A Leases and transferring the Mortgage Files 2013-A Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(ce) Upon Notwithstanding Section 7.01(d), if the occurrence of Indenture Trustee shall be unwilling so to act or if it is legally unable so to act, a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Successor Servicer shall be designated appointed in accordance with Section 8.04 of the Basic Servicing Agreement. Compensation for any Successor Servicer shall not be greater than that payable to act MBFS USA as initial Servicer hereunder, a “Servicer Term hereunder without the prior consent of Service”) until such time as the Master Servicer, Majority Noteholders of the Securities Administrator and the Trustee receives written direction from the Controlling Class (or Holders of Certificates evidencing at least representing not less than 51% of the Voting Rights not to deliver an Extension Noticeaggregate Certificate Percentage Interests then outstanding if the Notes are no longer Outstanding). The Indenture Trustee and such successor shall take such action, in which event the Master Servicer shall follow such direction; provided that nothing in consistent with this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service2013-A Servicing Supplement, the Servicer as shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds necessary to the obligations of Servicer hereunder, the term of the Successor Servicer or effectuate any such Person succession. The Indenture Trustee shall not be limited unless and relieved of its duties as Successor Servicer under this Section until a newly appointed Servicer Event shall have assumed the obligations and duties of Default thereafter occurs with respect the terminated Servicer under this 2013-A Servicing Supplement. Notwithstanding anything to such the contrary contained herein, in no event shall the Indenture Trustee be liable for any servicing fee or for any differential in the amount of the servicing fee paid hereunder and the amount necessary to induce any Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting act as Successor Servicer and the Person then-obligated to succeed such then-acting Servicerhereunder.
Appears in 1 contract
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2013-A)
Servicer Events of Default. (a) If any one of the The following events (“and conditions shall constitute Servicer Events of Default”) shall occur and be continuingDefault hereunder:
(i) (A) The failure by on the Servicer to make any Monthly Advance which continues unremedied for a period part of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in to the Collection Account Account, or other applicable account in accordance with the Distribution Account terms of the Indenture within three Business Days following the receipt thereof any deposit monies received by the Servicer (including, without limitation, any Lease Payments on Performing Leases or Non-Performing Leases) and required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was duedeposited thereunder and hereunder;
(ii) (A) The failure on the part of the Servicer to pay to the Trustee on the date when due in accordance with the terms hereof, any payment required to be made by the Servicer pursuant to make Section 5 hereof;
(iii) failure on the part of either the Servicer or (so long as the Originator is the Servicer) the Originator to observe or perform in any required material respect any other of their respective covenants or agreements in this Assignment and Servicing Advance Agreement which failure continues unremedied for a period of sixty 30 days after the earlier of (60A) daysthe date it first becomes known to any officer of the Originator or the Servicer, or as the case may be, and (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, thereof requiring the same to be remedied, remedied shall have been given to the Servicer Originator or the Servicer, as the case may be, by the Master ServicerTrustee, the Securities Administrator or the Trustee or to the Servicer Originator or the Servicer, as the case may be, and the Master ServicerTrustee by the Seller, the Securities Administrator Issuer, the Insurer or any holder of the Trustee, Notes;
(iv) if any representation or warranty made by the Originator in this Assignment and Servicing Agreement or in any certificate or other writing delivered pursuant hereto or made by any Holder successor Servicer in connection with Certificates evidencing Voting Rights such successor Servicer's assumption of at least 25%the duties of the Servicer shall prove to be incorrect in any material respect as of the time when the same shall have been made; provided, however, that the breach of any representation or warranty made by the Originator or Servicer in this Assignment and Servicing Agreement will be deemed to be "material" only if it affects the Noteholders, the Insurer or the enforceability of the Indenture or of the Notes; and provided, further, that a material breach of any representation or warranty made by the Originator in this Assignment and Servicing Agreement with respect to any of the Leases or the Equipment subject thereto will not constitute a Servicer Event of Default if the Originator purchases such Lease and the Issuer's interest in the case of Equipment or substitutes a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Substitute Lease therefor in accordance with this Assignment and the Trustee that the Servicer is diligently pursuing remedial actionServicing Agreement;
(iiiv) The filing an involuntary petition or proceeding shall be filed (A) in respect of a petition against the Servicer under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) seeking a decree or order adjudging the Servicer bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, or composition of or in a court respect of the Servicer under any applicable federal or agency state law, or supervisory authority having jurisdiction in the premises for the appointment of a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of the Servicer or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and either (1) such petition shall not have been dismissed within a period of 60 consecutive days or (2) any such order for relief or decree shall be entered in any such proceeding, or any such receiver, liquidator, assignee, trustee, sequestrator or other similar official shall be appointed;
(vi) the continuance commencement by the Servicer of a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any such other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order unstayed and for relief in effect for respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a period petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by it to the filing of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by it of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or failure by the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; orsuch action;
(vii) any reduction or withdrawal of the ratings failure of the Servicer as a servicer of subprime mortgage loans by to make one or more payments due with respect to aggregate recourse debt or other recourse obligations of the Rating Agencies that maintains a servicer rating system Servicer exceeding $5,000,000, or the occurrence of any event or the existence of any condition, the effect of which event or condition is to cause (or permit one or more Persons to cause) more than $5,000,000 of aggregate recourse debt or other recourse obligations of the Servicer to become due before its (or their) stated maturity or before its (or their) regularly scheduled dates of payment so long as such failure, event or condition shall be continuing and a rating on shall not have been waived by the Certificates Person or Persons entitled to “below average” or below; orperformance;
(viii) the failure by a final judgment or judgments (or decrees or orders) against the Servicer to comply, within for the required time periods, with Section 3.09 payment of money aggregating in excess of $5,000,000 and any one of such judgments (or the certification described under Section 3.10decrees or orders) has remained unsatisfied and in effect for any period of 60 consecutive days without a stay of execution;
(ix) for any three consecutive Due Periods, the failure by average of the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied Annualized Default Rates for a period of fifteen days after the date on which written notice of such failure, requiring the same to Due Periods shall be remedied, shall have been given to the Servicer by the Master Servicergreater than 8.00%; or
(x) for any three consecutive Due Periods, the identification under any filing pursuant to Section 404 average of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every Delinquency Rates for such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 Due Periods shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationgreater than 10.00%.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Assignment and Servicing Agreement (Ikon Receivables Funding LLC)
Servicer Events of Default. (a) If any one of the The following events (“and conditions shall constitute Servicer Events of Default”) shall occur and be continuingDefault hereunder:
(i) (A) The failure by on the Servicer to make any Monthly Advance which continues unremedied for a period part of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in to the Collection Account or other applicable account within three Business Days following the Distribution Account receipt thereof any deposit monies received by the Servicer (including, without limitation, any Lease Payments and any Non-Performing Lease Payments) and required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was duedeposited hereunder;
(ii) (A) The so long as the Seller is the Servicer hereunder, failure on the part of the Seller to pay to the Trustee on the date when due in accordance with the terms hereof, any payment required to be made by the Seller pursuant to Section 4 hereof;
(iii) failure on the part of either the Servicer or (so long as the Seller is the Servicer) the Seller to make observe or perform in any required material respect any other of their respective covenants or agreements in this Sales and Servicing Advance Agreement which failure continues unremedied for a period of sixty 30 days after the earlier of (60A) daysthe date it first becomes known to any officer of the Seller or the Servicer, or as the case may be, and (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, thereof requiring the same to be remedied, remedied shall have been given to the Servicer Seller or the Servicer, as the case may be, by the Master ServicerTrustee, the Securities Administrator or the Trustee or to the Servicer Seller or the Servicer, as the case may be, and the Master Servicer, the Securities Administrator or the Trustee, Trustee by any Holder holder of the Notes;
(iv) if any representation or warranty made by the Seller in this Sales and Servicing Agreement or in any certificate or other writing delivered pursuant hereto or made by any successor Servicer in connection with Certificates evidencing Voting Rights such successor Servicer's assumption of at least 25%the duties of the Servicer shall prove to be incorrect in any material respect as of the time when the same shall have been made; provided, however, that the breach of any representation or warranty made by the Seller or Servicer in this Sales and Servicing Agreement will be deemed to be "material" only if it affects the case of a failure that cannot be cured within sixty (60) daysNoteholders, the cure period may be extended enforceability of the Indenture or of the Notes; and provided, further, that a material breach of any representation or warranty made by the Seller in this Sales and Servicing Agreement with respect to any of the Leases or the Equipment subject thereto will not constitute a Servicer Event of Default if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Seller repurchases such Lease and the Trustee that the Servicer is diligently pursuing remedial action;Equipment in accordance with this Sales and Servicing Agreement.
(iiiv) The filing of a petition against the Servicer in entry by a court or agency or supervisory authority having jurisdiction in the premises of (A) a decree or order for relief in respect of the appointment Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) a decree or order adjudging the Servicer bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment, or composition of or in respect of the Servicer under any applicable federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of the Servicer or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of thirty (30) 60 consecutive days; or;
(ivvi) The the commencement by the Servicer shall voluntarily go into liquidationof a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order for relief in respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by it of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or failure by the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; orsuch action;
(vii) any reduction or withdrawal of the ratings failure of the Servicer as a servicer of subprime mortgage loans by to make one or more payments due with respect to aggregate recourse debt or other obligations exceeding $1,000,000, or the occurrence of any event or the existence of any condition, the effect of which event or condition is to cause (or permit one or more persons to cause) more than $1,000,000 of aggregate recourse debt or other obligations of the Rating Agencies that maintains a servicer rating system Servicer to become due before its (or their) stated maturity or before its (or their) regularly scheduled dates of payment so long as such failure, event or condition shall be continuing and a rating on shall not have been waived by the Certificates Person or Persons entitled to “below average” or belowperformance; or
(viii) a final judgment or judgments (or decrees or orders) for the failure by the Servicer to comply, within the required time periods, with Section 3.09 payment of money aggregating in excess of $1,000,000 and any one of such judgments (or the certification described under Section 3.10;
(ixdecrees or orders) the failure by the Servicer to provide, within the time frame specified herein, has remained unsatisfied and in effect for any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen 60 consecutive days after the date on which written notice without a stay of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreementexecution.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sales and Servicing Agreement (Copelco Capital Funding Corp X)
Servicer Events of Default. (a) If any one of the The following events (“and conditions shall constitute Servicer Events of Default”) shall occur and be continuingDefault hereunder:
(i) (A) The failure by on the Servicer to make any Monthly Advance which continues unremedied for a period part of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in to the Collection Account Account, or other applicable account in accordance with the Distribution Account terms of the Indenture within three Business Days following the receipt thereof any deposit monies received by the Servicer (including, without limitation, any Lease Payments on Performing Leases or Non-Performing Leases) and required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was duedeposited thereunder and hereunder;
(ii) (A) The failure on the part of the Servicer to pay to the Trustee on the date when due in accordance with the terms hereof, any payment required to be made by the Servicer pursuant to make Section 5 hereof;
(iii) failure on the part of either the Servicer or (so long as the Originator is the Servicer) the Originator to observe or perform in any required material respect any other of their respective covenants or agreements in this Assignment and Servicing Advance Agreement which failure continues unremedied for a period of sixty 30 days after the earlier of (60A) daysthe date it first becomes known to any officer of the Originator or the Servicer, or as the case may be, and (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, thereof requiring the same to be remedied, remedied shall have been given to the Servicer Originator or the Servicer, as the case may be, by the Master ServicerTrustee, the Securities Administrator or the Trustee or to the Servicer Originator or the Servicer, as the case may be, and the Master ServicerTrustee by the Seller, the Securities Administrator Issuer, the Insurer or any holder of the Trustee, Notes;
(iv) if any representation or warranty made by the Originator in this Assignment and Servicing Agreement or in any certificate or other writing delivered pursuant hereto or made by any Holder successor Servicer in connection with Certificates evidencing Voting Rights such successor Servicer's assumption of at least 25%the duties of the Servicer shall prove to be incorrect in any material respect as of the time when the same shall have been made; provided, however, that the breach of any -------- ------- representation or warranty made by the Originator or Servicer in this Assignment and Servicing Agreement will be deemed to be "material" only if it affects the Noteholders, the Insurer or the enforceability of the Indenture or of the Notes; and provided, further, that a material breach of -------- ------- any representation or warranty made by the Originator in this Assignment and Servicing Agreement with respect to any of the Leases or the Equipment subject thereto will not constitute a Servicer Event of Default if the Originator purchases such Lease and the Issuer's interest in the case of Equipment or substitutes a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Substitute Lease therefor in accordance with this Assignment and the Trustee that the Servicer is diligently pursuing remedial actionServicing Agreement;
(iiiv) The filing an involuntary petition or proceeding shall be filed (A) in respect of a petition against the Servicer under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) seeking a decree or order adjudging the Servicer bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, or composition of or in a court respect of the Servicer under any applicable federal or agency state law, or supervisory authority having jurisdiction in the premises for the appointment of a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of the Servicer or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and either (1) such petition shall not have been dismissed within a period of 60 consecutive days or (2) any such order for relief or decree shall be entered in any such proceeding, or any such receiver, liquidator, assignee, trustee, sequestrator or other similar official shall be appointed;
(vi) the continuance commencement by the Servicer of a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any such other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order unstayed and for relief in effect for respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a period petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by it to the filing of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by it of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or failure by the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; orsuch action;
(vii) any reduction or withdrawal of the ratings failure of the Servicer as a servicer of subprime mortgage loans by to make one or more payments due with respect to aggregate recourse debt or other recourse obligations of the Rating Agencies that maintains a servicer rating system Servicer exceeding $5,000,000, or the occurrence of any event or the existence of any condition, the effect of which event or condition is to cause (or permit one or more Persons to cause) more than $5,000,000 of aggregate recourse debt or other recourse obligations of the Servicer to become due before its (or their) stated maturity or before its (or their) regularly scheduled dates of payment so long as such failure, event or condition shall be continuing and a rating on shall not have been waived by the Certificates Person or Persons entitled to “below average” or below; orperformance;
(viii) the failure by a final judgment or judgments (or decrees or orders) against the Servicer to comply, within for the required time periods, with Section 3.09 payment of money aggregating in excess of $5,000,000 and any one of such judgments (or the certification described under Section 3.10decrees or orders) has remained unsatisfied and in effect for any period of 60 consecutive days without a stay of execution;
(ix) so long as IOS Capital is the failure by the Servicer to provideServicer, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 downgrading of the Slong-term debt rating assigned by ▇▇▇▇▇▇▇-▇▇▇▇'▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability or S&P to perform any of its duties under this Agreement.IOS Capital to Ba2 or below or BB or below, respectively;
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) abovefor any three consecutive Due Periods, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer average of the Trustee or Annualized Default Rates for such Due Periods shall be greater than 8.00%; or
(xi) for any three consecutive Due Periods, the average of the Securities Administrator of Delinquency Rates for such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 Due Periods shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationgreater than 10.00%.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Assignment and Servicing Agreement (Ikon Receivables LLC)
Servicer Events of Default. (a) If any one Any of the following events (“acts or occurrences shall constitute a Servicer Events Event of Default”) shall occur and be continuing:
(i) any failure by the Servicer (A) The to deliver to the Local Bank for deposit in the Local Bank Account or (B) to deliver or cause to be delivered to the Trustee for deposit in the Collection Account any proceeds or payments received from an Obligor or in respect of the Trust Estate and required to be so delivered under the terms of the Indenture and this Agreement that continues unremedied until 2:00 p.m., New York time, on the second successive Business Day following such failure; or provided, however, that the Trustee, upon receiving actual knowledge of such failure, shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(ii) any failure by the Servicer to deliver a Monthly Servicer's Report pursuant to Section 4.01 hereof that continues unremedied until 2:00 p.m., New York time, the following Business Day; provided, however, that if the Trustee has actual knowledge that the Servicer has not delivered such Monthly Servicer's Report by 2:00 p.m., New York time, on a Determination Date, the Trustee shall give the Servicer written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(iii) any failure by the Servicer to remit any Purchase Price received by it to the Trustee that continues unremedied until 5:00 p.m., New York time, the following Business Day; provided, however, that if the Servicer has not remitted any Purchase Price received by it to the Trustee by 3:00 p.m., New York time, on the Determination Date and the Trustee has actual knowledge that such Purchase Price has not been paid, the Trustee shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(iv) any failure by the Servicer to make remittances (other than a remittance of Purchase Price referred to in clause (iii) above) or deliver notices pursuant to Section 3.03 hereof, that continues unremedied until 2:00 p.m., New York time, of the second successive Business Day; or
(v) any Monthly Advance failure on the part of the Servicer duly to observe or perform any other covenants or agreements of the Servicer set forth in this Agreement or the Indenture or any representation or warranty of the Servicer set forth in Section 2.01 of this Agreement shall prove to be incorrect in any material respect, which failure or breach continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 30 days after the date on which the Servicer becomes aware of such failure or breach, or receives written notice of such failure, requiring the same to be remedied, shall have been given to failure or breach; or
(vi) any assignment by the Servicer to a delegate of its duties or rights under this Agreement or except as specifically permitted hereunder, or any attempt to make such an assignment; or
(vii) the entry of a decree or order for relief by the Master Servicer, the Securities Administrator or the Trustee or to a court having jurisdiction in respect of the Servicer and the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in an involuntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy, insolvency or similar law, or appointing a court receiver, liquidator, assignee, trustee, custodian, sequestrator or agency or supervisory authority having jurisdiction in the premises other similar official for the appointment Servicer or for any substantial part of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingsits property, or for ordering the winding up or liquidation of its affairs, the affairs of the Servicer and the continuance of any such decree or order unstayed and in effect effect, or failure for such petition to be dismissed, for a period of thirty (30) 60 consecutive days; or
(ivviii) The the commencement by the Servicer shall voluntarily go into liquidationof a voluntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy, insolvency, reorganization or similar law, or the consent by the Servicer to the appointment of or taking possession by a conservator conservator, receiver, liquidator, assignee, trustee, custodian, sequestrator or receiver or liquidator or other similar person official in any insolvency, readjustment of debt, marshaling of assets and liabilities liabilities, bankruptcy or similar proceedings of or relating to the Servicer or of or relating to all or substantially all a substantial part of its property, or a decree or order the making by the Servicer of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up failure by the Servicer generally to pay its debts as such debts become due or liquidation of its affairs, shall have been entered against the Servicer; or if the Servicer shall admit in writing its inability to pay its their debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing taking of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure corporate action by the Servicer to comply, within in furtherance of any of the required time periods, with Section 3.09 or the certification described under Section 3.10;foregoing; or
(ix) the failure by stockholders' equity of the Servicer to provideand its consolidated subsidiaries, within the time frame specified hereindetermined in accordance with generally accepted accounting principles, any required reports or data pertaining to the Mortgage Loansas would be shown on a consolidated balance sheet for such Persons, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Serviceris below $50,000,000; or
(x) the identification under any filing pursuant to Section 404 occurrence of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreementa Trigger Event.
(b) then, and in each and every such case, so long as If a Servicer Event of Default shall not have been remediedoccurred and be continuing, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit DateTrustee shall, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer direction of the Trustee or Holders of Notes representing not less than 66-2/3% in principal amount of the Securities Administrator Outstanding Notes of such failurethe Controlling Class, the Master Servicer shall give telephonic by notice (by no later than 5:00 p.m. New York time on such Deposit Datethe "Servicer Termination Notice") of the failure given in writing to make a Monthly Advance to a Servicing Officer of the Servicer andterminate all, to the extent the applicable current contact information has been provided to the Master Servicerbut not less than all, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations (except as expressly provided herein) of the Servicer under this Agreement Agreement. Notwithstanding the foregoing, a delay in or failure of performance under Sections 6.01(a)(ii) or 6.01(a)(v) hereof for a period of not more than 30 days past the applicable cure period shall not constitute a Servicer Event of Default if such delay or failure could not have been prevented by the exercise of reasonable diligence by the Servicer and such delay or failure was caused by acts of declared or undeclared war, public disorder, rebellion or sabotage, epidemics, landslides, lightning, fire, hurricanes, earthquakes, floods or similar causes; provided, however, that in any event, such delay or failure shall constitute a Servicer Event of Default if it continues unremedied for a period of 30 days past the Successor applicable cure period. The preceding sentence shall not relieve the Servicer appointed from using its best efforts to perform its obligations in a timely manner in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution terms of funds on the related Distribution Date and assumethis Agreement, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and Servicer shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to provide the Trustee, terminate all the Issuer and the Noteholders with prompt notice of the rights and obligations such failure or delay by it, together with a description of the Servicer as servicer under this Agreement. its efforts to so perform its obligations.
(c) On or after the receipt by the Servicer of such written noticea Servicer Termination Notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, Agreement shall pass to and be vested in the Successor Trustee as successor Servicer unless another successor Servicer is appointed pursuant to and under this Section 8.016.02 hereof; and, without limitation, the Successor any successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the such Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage the Loan and related documentsDocuments, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator Trustee and the Trustee successor Servicer in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage LoansTrust Estate. All Servicing Transfer Costs and other reasonable out-of-pocket To assist the successor Servicer in enforcing all rights under the Contracts, the outgoing Servicer, at its own expense (including, without limitation, any costs and or expenses (including attorneys’ fees) incurred in connection associated with the termination complete transfer of all servicing data and the completion, correction or manipulation of such servicing data as may be required by the successor Servicer to correct any errors or insufficiencies in the servicing data or otherwise to enable the successor Servicer to service the Contracts properly and transferring the Mortgage Files effectively to the Successor successor Servicer in such form as the successor Servicer may reasonably request), shall transfer its records (electronic and amending this Agreement otherwise) relating to reflect such succession as Servicer pursuant to this Section 8.01 the Trust Estate and shall be paid by transfer the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, related Loan Documents (to the extent not paid held by the predecessor ServicerTrustee) and all other records, by correspondence and documents relating to the Trust prior Estate that it may possess to distributions to Certificateholders (or, if the predecessor successor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence manner and at such amounts are paid by times as the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the successor Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationreasonably request.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Servicer Events of Default. (a) If any one of the The following events (“and conditions shall constitute Servicer Events of Default”) shall occur and be continuingDefault hereunder:
(i) (A) The failure by on the Servicer to make any Monthly Advance which continues unremedied for a period part of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in to the Collection Account Account, or other applicable account in accordance with the Distribution Account terms of the Indenture within three Business Days following the receipt thereof any deposit monies received by the Servicer (including, without limitation, any Lease Payments on Performing Leases or Non-Performing Leases) and required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was duedeposited thereunder and hereunder;
(ii) (A) The failure on the part of the Servicer to pay to the Trustee on the date when due in accordance with the terms hereof, any payment required to be made by the Servicer pursuant to make Section 5 hereof;
(iii) failure on the part of either the Servicer or (so long as the Originator is the Servicer) the Originator to observe or perform in any required material respect any other of their respective covenants or agreements in this Assignment and Servicing Advance Agreement which failure continues unremedied for a period of sixty 30 days after the earlier of (60A) daysthe date it first becomes known to any officer of the Originator or the Servicer, or as the case may be, and (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, thereof requiring the same to be remedied, remedied shall have been given to the Servicer Originator or the Servicer, as the case may be, by the Master ServicerTrustee, the Securities Administrator or the Trustee or to the Servicer Originator or the Servicer, as the case may be, and the Master ServicerTrustee by the Seller, the Securities Administrator Issuer, the Insurer or any holder of the Trustee, Notes;
(iv) if any representation or warranty made by the Originator in this Assignment and Servicing Agreement or in any certificate or other writing delivered pursuant hereto or made by any Holder successor Servicer in connection with Certificates evidencing Voting Rights such successor Servicer's assumption of at least 25%the duties of the Servicer shall prove to be incorrect in any material respect as of the time when the same shall have been made; provided, however, that the breach of any -------- ------- representation or warranty made by the Originator or Servicer in this Assignment and Servicing Agreement will be deemed to be "material" only if it affects the Noteholders, the Insurer or the enforceability of the Indenture or of the Notes; and provided, further, that a material breach of -------- ------- any representation or warranty made by the Originator in this Assignment and Servicing Agreement with respect to any of the Leases or the Equipment subject thereto will not constitute a Servicer Event of Default if the Originator purchases such Lease and the Issuer's interest in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Equipment in accordance with this Assignment and the Trustee that the Servicer is diligently pursuing remedial actionServicing Agreement;
(iiiv) The filing of a petition against the Servicer in entry by a court or agency or supervisory authority having jurisdiction in the premises of (A) a decree or order for relief in respect of the appointment Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) a decree or order adjudging the Servicer bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment, or composition of or in respect of the Servicer under any applicable federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of the Servicer or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of thirty (30) 60 consecutive days; or;
(ivvi) The the commencement by the Servicer shall voluntarily go into liquidationof a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order for relief in respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by it of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or failure by the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; orsuch action;
(vii) any reduction or withdrawal of the ratings failure of the Servicer as a servicer of subprime mortgage loans by to make one or more payments due with respect to aggregate recourse debt or other obligations exceeding $5,000,000, or the occurrence of any event or the existence of any condition, the effect of which event or condition is to cause (or permit one or more Persons to cause) more than $5,000,000 of aggregate recourse debt or other obligations of the Rating Agencies that maintains a servicer rating system Servicer to become due before its (or their) stated maturity or before its (or their) regularly scheduled dates of payment so long as such failure, event or condition shall be continuing and a rating on shall not have been waived by the Certificates Person or Persons entitled to “below average” or below; orperformance;
(viii) a final judgment or judgments (or decrees or orders) for the failure by the Servicer to comply, within the required time periods, with Section 3.09 payment of money aggregating in excess of $5,000,000 and any one of such judgments (or the certification described under Section 3.10decrees or orders) has remained unsatisfied and in effect for any period of 60 consecutive days without a stay of execution;
(ix) so long as IOS Capital is the failure by the Servicer to provideServicer, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 downgrading of the Slong-term debt rating assigned by ▇▇▇▇▇▇▇-▇▇▇▇'▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability or S&P to perform any of its duties under this Agreement.IOS Capital to Ba2 or below or BB or below, respectively;
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) abovefor any three consecutive Due Periods, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer average of the Trustee or Annualized Default Rates for such Due Periods shall be greater than 8.00%; or
(xi) for any three consecutive Due Periods, the average of the Securities Administrator of Delinquency Rates for such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 Due Periods shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationgreater than 10.00%.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Assignment and Servicing Agreement (Ikon Receivables LLC)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2014-A Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2014-A Exchange Note or to this 2014-A Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2014-A Exchange Note under the Basic Servicing Agreement or this 2014-A Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2014-A Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2014-A Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2014-A Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2014-A Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2014-A Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of certain Insolvency Events with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2014-A Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2014-A Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2014-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementA Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2014-A Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2014-A Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2014-A Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf terms of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwiseBasic Servicing Agreement. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2014-A Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2014-A Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans2014-A Leases and 2014-A Vehicles and all information or documents that the Indenture Trustee or such Successor Servicer may require. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of In addition, the Servicer shall transfer its electronic records relating to the 2014-A Leases and transferring the Mortgage Files 2014-A Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(ce) Upon Notwithstanding Section 7.01(d), if the occurrence of Indenture Trustee shall be unwilling so to act or if it is legally unable so to act, a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Successor Servicer shall be designated appointed in accordance with Section 8.04 of the Basic Servicing Agreement. Compensation for any Successor Servicer shall not be greater than that payable to act MBFS USA as initial Servicer hereunder, a “Servicer Term hereunder without the prior consent of Service”) until such time as the Master Servicer, Majority Noteholders of the Securities Administrator and the Trustee receives written direction from the Controlling Class (or Holders of Certificates evidencing at least representing not less than 51% of the Voting Rights not to deliver an Extension Noticeaggregate Certificate Percentage Interests then outstanding if the Notes are no longer Outstanding). The Indenture Trustee and such successor shall take such action, in which event the Master Servicer shall follow such direction; provided that nothing in consistent with this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service2014-A Servicing Supplement, the Servicer as shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds necessary to the obligations of Servicer hereunder, the term of the Successor Servicer or effectuate any such Person succession. The Indenture Trustee shall not be limited unless and relieved of its duties as Successor Servicer under this Section until a newly appointed Servicer Event shall have assumed the obligations and duties of Default thereafter occurs with respect the terminated Servicer under this 2014-A Servicing Supplement. Notwithstanding anything to such the contrary contained herein, in no event shall the Indenture Trustee be liable for any servicing fee or for any differential in the amount of the servicing fee paid hereunder and the amount necessary to induce any Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting act as Successor Servicer and the Person then-obligated to succeed such then-acting Servicerhereunder.
Appears in 1 contract
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2014-A)
Servicer Events of Default. (a) If any one of the I. The following events (shall each constitute a “Servicer Events Event of Default”) shall occur and be continuing” hereunder:
(i) (A) The any failure by the Master Servicer to make remit to the Indenture Trustee any Monthly Advance 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 Advances, which shall have no cure period), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure 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 to deposit and Indenture Trustee by the Note Insurer or Noteholders affected thereby evidencing Percentage Interests of at least 25%; provided however that any failed remittance cured within one Business Day of such failure shall include interest accrued at the Prime Rate (as set forth in the Collection Account or Wall Street Journal) on the Distribution Account any deposit amount of such remittance from and including the date the remittance was required to be made under to and including the terms of this Agreement which continues unremedied for a period of two date the remittance was actually made;
(2) Business Days after such deposit was due or (Cii) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Master Servicer to make any required Servicing Advance Advance, which failure continues unremedied for a period of sixty thirty (6030) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 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 Master Servicer, the Securities Administrator or the Indenture Trustee or to the Master Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing any failure on the part of a petition against the Master Servicer in a court duly to observe or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator perform in any insolvency, conservatorship, receivership, readjustment material respect any other of debt, marshaling the covenants or agreements on the part of assets and liabilities or similar proceedingsthe Master Servicer contained in this Agreement, or for the winding up or liquidation of its affairs, and the continuance failure of any such decree or order unstayed representation and in effect warranty made pursuant to Section 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) consecutive days; ordays 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) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises an involuntary case under any present or future federal or state bankruptcy, insolvency or similar law or for the appointment of a conservator, receiver, liquidator conservator or similar person receiver or liquidation in any insolvency, readjustment of debt, marshaling 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; or ’s property;
(vi) the Master Servicer shall admit in writing its inability generally to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors creditors, or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or;
(vii) the Note Insurer shall notify the Indenture Trustee of any reduction or withdrawal “event of default” under the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; orInsurance Agreement;
(viii) if on any Payment Date the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10Rolling Six Month Delinquency Rate exceeds 14.0%;
(ix) if on any Payment Date, the failure by Cumulative Loan Loss Percentage exceeds the Servicer to providefollowing percentages on any Payment Date during the following periods: June 2004 - May 2006 1.70 % June 2006 - May 2007 2.50 % June 2007 - May 2008 3.20 % June 2008 and thereafter 4.50 %
(x) if the total stockholders’ equity of the Master Servicer, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the 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
(xxii) the identification under any filing pursuant to Section 404 occurrence of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer an Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on under the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationIndenture.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Accredited Mortgage Loan Trust 2004-2)
Servicer Events of Default. (a) If any one Each of the following events shall constitute a Servicer Event of Default (a “Servicer Events Event of Default”) shall occur and be continuingunder this Agreement:
(ia) (A) The failure by the Master Servicer to make any Monthly Advance payments required to be made by it hereunder on the day on which such payment is required to be made and such failure continues for three Business Days;
(b) failure on the part of the Master Servicer to observe or perform in any respect any other covenants or agreements of the Master Servicer contained herein which continues unremedied for a period of one 30 days after the earlier of (1i) Business Day after it was due; Master Servicer’s knowledge thereof and (ii) receipt by Master Servicer of written notice thereof from Lender or Administrator;
(Bc) the delegation by the Master Servicer of its duties hereunder;
(d) any other failure representation, warranty or certification made by the Master Servicer herein proves to deposit have been incorrect when made;
(e) so long as Baldor shall be the Master Servicer the Consolidated Tangible Net Worth of Baldor shall be less than or equal to 60% of Baldor’s current Consolidated Net Worth;
(f) an Event of Bankruptcy shall have occurred with respect to the Master Servicer or any Originator;
(g) a final judgment or judgments for the payment of money in excess of $50,000 in the Collection Account aggregate shall have been rendered against Borrower or $5,000,000 in the Distribution Account any deposit required to be made under aggregate shall have been rendered against Baldor and the terms same shall have remained unsatisfied and in effect, without stay of this Agreement which continues unremedied execution, for a period of two (2) Business Days 30 consecutive days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied period for a period of one (1) Business Day after it was due;appellate review shall have elapsed; or
(iih) (A) The failure by the Servicer Baldor shall fail to make pay any required Servicing Advance which failure continues unremedied for a period Debt in excess of sixty (60) days$5,000,000 when due, or (B) a default shall have occurred and be continuing with respect to any such Debt which default results in, or would permit, the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice acceleration of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Trustee or to the Servicer and the Master Servicer, the Securities Administrator or the Trustee, by Debt. At any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and time during the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer Event of Default Default, Administrator may, in its sole discretion, notify Master Servicer in writing of the revocation of its appointment as Master Servicer hereunder. Upon revocation of Master Servicer’s appointment hereunder, Administrator shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, appoint a successor Master Servicer. Master Servicer agrees that upon receipt of written notice or discovery by notification from Administrator of the revocation of Master Servicer’s appointment as Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failurehereunder, the Master Servicer shall give telephonic notice upon the written request of Administrator (by no later than 5:00 p.m. New York time on such Deposit Datewhich request may be contained in the notification of revocation) of (i) notify all Obligors under the failure Receivables to make a Monthly Advance payment thereof to a Servicing Officer of the Servicer andbank account(s) or post office box designated by Administrator and specified in such notice, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through pay to Administrator (xor its designee) aboveimmediately all Collections then held or thereafter received by Master Servicer or any Originator of Receivables, together with all other payment obligations of the Trustee Master Servicer hereunder owing to Lender or Administrator. Master Servicer shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Sellerits sole cost and expense, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with and assist the Successor Servicer, the successor Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, (including, without limitation, the transfer to the Successor Servicer providing access to, and transferring, all Receivable Files and all records (including data-processing records) relating thereto (which shall be held in trust for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination benefit of the Servicer parties hereto in accordance with their respective interests)) and transferring allowing the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the successor Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to use all licenses, hardware or software necessary or desirable to collect the terminated Servicer Receivables). Baldor irrevocably agrees to act (if requested to do so) as permitted under Section 3.03 on a firstthe data-in, first-out basis. The Servicer shall continue to be entitled to processing agent for the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the successor Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each in substantially the same manner as Baldor conducted such quarterly period for which the Servicer shall be designated to act data-processing functions while it acted as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated).
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Loan Agreement (Baldor Electric Co)
Servicer Events of Default. (a) If any one of the following events (“Servicer "Events of Default”") shall occur and be continuing:
(i) (A) The failure by the Servicer to make any Monthly Advance which continues unremedied for a period of one (1) Business Day after it was dueAdvance; or (B) any other failure by the Servicer to deposit in into the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;the date upon which written notice of such failure shall have been given to the Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by the Note Insurer or to the Servicer and the Indenture Trustee by Holders of Class A Notes evidencing not less than 25% of the Voting Rights; or
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) 30 days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, Class A Noteholders or the Note Insurer and which failure continues unremedied for a period of sixty (60) 60 days, in each case, after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if to the Servicer can demonstrate to and the reasonable satisfaction Indenture Trustee by Holders of Class A Notes evidencing not less than 25% of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;Voting Rights; or
(iii) The filing of a petition entry against the Servicer in of a decree or order by a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling marshalling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) 60 consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling marshalling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling marshalling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the ServicerServicer and such decree or order shall have remained in force undischarged, unbonded or unstayed for a period of 60 days; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the a Servicer Termination Test is failed; orDelinquency Event shall have occurred;
(avi) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the a Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage LoansTermination Loss Event shall have occurred; or
(vii) any reduction or withdrawal if the total stockholders' equity of the ratings of Servicer, as determined by the Servicer Servicer's independent accountants on an annual basis in accordance with generally accepted accounting principles or as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure determined by the Servicer to comply, within the required time periods, in any quarterly financial statement prepared in accordance with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remediedgenerally accepted accounting principles, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreementbe less than $25 million.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(Ai)(A) above, (1) if such Monthly Advance is not made by 12:00 Noon New York time on the related Deposit applicable Payment Date, the Indenture Trustee, upon receipt of written notice or discovery actual knowledge by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give immediate telephonic notice of such failure to a Servicing Officer of the Servicer and to the Master Servicer Note Insurer and the Indenture Trustee shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer Indenture Trustee as successor servicer, or a successor servicer appointed in accordance with Section 8.02 6.02, shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.026.02 hereof, the duties of a Successor Servicer and successor Servicer; (y) in the case of clause clauses (a)(i)(C) the Trustee and the Depositor may i)(B), (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause ii), (a)(i)(Biii) and (ii) through (x) aboveiv), the Indenture Trustee shall, at the direction of the Note Insurer or the Holders of Offered Certificates the Class A Notes evidencing not less than 51% of all the Voting Rights, and (z) in the case of (i)(B)(v) and (vi), the Note Insurer may, in accordance with the terms of the Voting Rights Insurance Agreement, by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee Servicer (and to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and Indenture Trustee if given by Holders of Certificates, to the TrusteeNotes), terminate all of the rights and obligations of the Servicer as servicer under this Agreement. Any such notice to the Servicer shall also be given to each Rating Agency, the Depositor and the Note Insurer. On or after the receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates Notes or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer Indenture Trustee as successor servicer pursuant to and under this Section 8.016.01; and, without limitation, the Successor Servicer Indenture Trustee is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer Indenture Trustee as successor servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ ' fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 6.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, or if the predecessor Servicer is the Master ServicerIndenture Trustee, by the initial Servicer), ) upon presentation of reasonable documentation of such costs and expenses. If the Indenture Trustee is acting as successor servicer and the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence such costs and such amounts are paid by the Trustexpenses, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer Indenture Trustee shall continue to be entitled to receive reimbursement from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer Trust to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal extent set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day Section 3.05 of the calendar quarter Indenture. Notwithstanding the foregoing, a delay in which such Servicer Event or failure of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”performance under Section 6.01(a)(i) for a succeeding quarterly period ending on December 31of ten Business Days, March 31or under Section 6.01(a)(ii), June 30 and September 30 for a period of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder60 Business Days, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until constitute a Servicer Event of Default thereafter occurs if such delay or failure could not be prevented by the exercise of reasonable diligence by the Servicer and such delay or failure was caused by an act of God or the public enemy, acts of declared or undeclared war, public disorder, rebellion or sabotage, epidemics, landslides, lightning, fire, hurricanes, earthquakes, floods or similar causes. The preceding sentence shall not relieve the Servicer from using its best efforts to perform its respective obligations in a timely manner in accordance with respect to such Successor the terms of this Agreement and the Servicer or other Person. At such timeshall provide the Indenture Trustee, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer Note Insurer and the Person then-obligated Noteholders with an Officers' Certificate giving prompt notice of such failure or delay by it, together with a description of its efforts to succeed such then-acting Servicerso perform its obligations. The Servicer shall immediately notify the Indenture Trustee in writing of any Events of Default.
Appears in 1 contract
Sources: Servicing Agreement (Home Loan Mortgage Loan Trust 2004-2)
Servicer Events of Default. (a) If any one of the following events (“Servicer Events of Default”) shall occur and be continuing:
(i) (A) The failure by the Servicer to make any Monthly Advance which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Payment Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Payment Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the CertificateholdersNoteholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, the Securities Administrator or the Indenture Trustee, by any Holder with Certificates evidencing Voting Rights the Holders of at least not less than 25%% of the aggregate Note Balance of the Notes; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Administrator, the Indenture Trustee and the Trustee Seller that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates Notes attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates Notes on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates Notes to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Indenture Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 6.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Payment Date and assume, pursuant to Section 8.026.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Indenture Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all the aggregate Note Balance of the Voting RightsNotes) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Indenture Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all the aggregate Note Balance of the Voting Rights Notes by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of CertificatesNotes, to the Indenture Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates Notes or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.016.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 6.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions payments to Certificateholders Noteholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.035.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Indenture Trustee receives written direction from the Holders of Certificates evidencing at least not less than 51% of the Voting Rights aggregate Note Balance of the Notes not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders Noteholders from directing the Indenture Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c6.01(c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Servicing Agreement (Renaissance Home Equity Loan Trust 2007-2)
Servicer Events of Default. (a) If any one of the I. The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Master Servicer to make remit to the Indenture Trustee any Monthly Advance 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 Periodic Advances, which shall have no cure period), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure 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 to deposit in and Indenture Trustee by the Collection Account Note Insurer or the Distribution Account any deposit required to be made under the terms Noteholders affected thereby evidencing Percentage Interests of this Agreement which continues unremedied for a period of two at least 25%;
(2) Business Days after such deposit was due or (Cii) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Master Servicer to make any required Servicing Advance Advance, which failure continues unremedied for a period of sixty thirty (6030) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 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 Master Servicer, the Securities Administrator or the Indenture Trustee or to the Master Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing any failure on the part of a petition against the Master Servicer in a court duly to observe or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator perform in any insolvency, conservatorship, receivership, readjustment material respect any other of debt, marshaling the covenants or agreements on the part of assets and liabilities or similar proceedingsthe Master Servicer contained in this Agreement, or for the winding up or liquidation of its affairs, and the continuance failure of any such decree or order unstayed representation and in effect warranty made pursuant to Section 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) consecutive days; ordays 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) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises an involuntary case under any present or future federal or state bankruptcy, insolvency or similar law or for the appointment of a conservator, receiver, liquidator conservator or similar person receiver or liquidation in any insolvency, readjustment of debt, marshaling 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; or 's property;
(vi) the Master Servicer shall admit in writing its inability generally to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors creditors, or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or;
(vii) the Note Insurer shall notify the Indenture Trustee of any reduction or withdrawal "event of default" under the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; orInsurance Agreement;
(viii) if on any Payment Date the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10Rolling Six Month Delinquency Rate exceeds 14.0%;
(ix) if on any Payment Date, the failure by Twelve Month Loss Amount exceeds 2.50% of the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to Aggregate Principal Balance of the Mortgage Loans, as of the close of business on the first day of the twelfth preceding calendar month;
(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 $40 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 failure continues unremedied for a period of fifteen 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 Master Servicer; orIndenture 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%;
(xii) 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 identification under Backup Servicer shall consent to the appointment of a conservator or receiver or liquidator in any filing pursuant insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceedings of or relating to Section 404 the Backup Servicer or of or relating to all or substantially all of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act 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 2002 which identifies material weaknesses in connection with any applicable insolvency or reorganization statute, make an assignment for the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any benefit of its duties under this Agreement.
(b) thencreditors, and in each and every such case, so 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 clause (a)(i)(A) aboveSection 7.01(a)(I)(i), (1) if such payment is in respect of Periodic Advances or Compensating Interest owing by the Master Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Payment Date, the Indenture Trustee, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Master Servicer and the Master Backup Servicer shall direct and to the Note Insurer, and the Indenture Trustee to terminate all may, with the consent of the rights Note Insurer, and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the TrusteeNote Insurer, terminate all of the rights and obligations of the Master Servicer as 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 Periodic 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), (vii) 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 (viii)-(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. On or after 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 Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Backup Servicer, or another successor master servicer selected by the Note Insurer, and the Backup Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor 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, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Master Servicer agrees to cooperate (and to pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator Indenture Trustee and the Trustee Backup Servicer or another successor master servicer in effecting the termination of the Master Servicer's responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Backup Servicer or another successor master servicer, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Master Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Note Insurer and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of DefaultDefault upon discovery or receipt of notice by a Responsible Officer of the Indenture Trustee; provided, however, the Servicer Indenture Trustee shall act as Servicer under this Agreement, subject not be obligated to monitor the right Master Servicer's compliance with the terms hereof or to determine the occurrence of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such any Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminatedDefault.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Accredited Mort Loan Trust Asset Back Notes Series 2003-1)
Servicer Events of Default. (a) If any one of the The following events (shall each constitute a “Servicer Events Event of Default”) shall occur and be continuing” hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below and Delinquency Advances, which shall have no cure period), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and Indenture Trustee by the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25%; provided, however, provided however that any failed remittance cured within one Business Day of such failure shall include interest accrued at the Prime Rate (as set forth in the case Wall Street Journal) on the amount of a failure that cannot such remittance from and including the date the remittance was required to be cured within sixty (60) days, made to and including the cure period may be extended if date the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial actionremittance was actually made;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Servicer; orIndenture Trustee or to the Servicer and the Indenture Trustee by the Noteholders affected thereby evidencing Percentage Interests of at least 25%;
(xiii) any failure on the identification under part of the Servicer duly to observe or perform in any filing material respect any other of the covenants or agreements on the part of the Servicer contained in this Agreement, or the failure of any representation and warranty made pursuant to Section 404 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) days after the S▇▇▇▇▇▇▇date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by the 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-▇▇▇▇▇ Act up or liquidation of 2002 which identifies material weaknesses its affairs, shall have been entered against the Servicer and such decree or order shall have remained in connection with force, undischarged or unstayed for a period of ninety (90) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer’s ongoing evaluation property;
(vi) the Servicer shall admit in writing its inability generally to pay its debts as they become due, file a petition to take advantage of internal controls which materially and adversely affect any applicable insolvency or reorganization statute, make an assignment for the Servicer’s ability to perform any benefit of its duties under this Agreement.creditors, or voluntarily suspend payment of its obligations;
(bvii) thenif on any Payment Date the Rolling Six Month Delinquency Ratio exceeds %;
(viii) if on any Payment Date, the Cumulative Realized Loss Percentage exceeds the following percentages on any Payment Date during the following periods: - % - % - % and in each and every such case, so thereafter %
(ix) the occurrence of an Event of Default under the Indenture. So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Delinquency Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Payment Date, the Indenture Trustee, upon receipt of written notice or discovery actual knowledge by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct Indenture Trustee may, and upon request of the Trustee to Holders representing more than 50% of the Class Note Balance, shall, terminate all of the rights and obligations of the Servicer under this Agreement Agreement, except for the Servicer’s indemnification obligation under Section 5.19, and the Successor Servicer Indenture Trustee (if it is the successor servicer) or a successor servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Delinquency Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest as provided in Section 7.02 and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (xii) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) aboveMajority Noteholders, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the SellerServicer and a Responsible Officer of the Indenture Trustee, the Servicerand in addition to whatever rights such Noteholders may have at law or equity to damages, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer; and (z) with respect to clauses (vii)-(ix) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee shall, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to another successor servicer, and under this Section 8.01; and, without limitation, the Successor Servicer another successor servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and to pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee or another successor servicer in effecting the termination of the Servicer’s responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer another successor servicer, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with The Indenture Trustee shall promptly notify the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of DefaultDefault upon discovery or receipt of notice by a Responsible Officer of the Indenture Trustee; provided, however, the Servicer Indenture Trustee shall act as Servicer under this Agreement, subject not be obligated to monitor the right Servicer’s compliance with the terms hereof or to determine the occurrence of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such any Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminatedDefault.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Accredited Mortgage Loan REIT Trust)
Servicer Events of Default. (a) If any one of the following events (“"Servicer Events of Default”") shall occur and be continuing:
(i) (A) The failure by the Servicer to make any Monthly Advance which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other Any failure by the Servicer to deposit in into the Collection Account or the Distribution Collateral Account any deposit proceeds or payment, required to be made so deposited under the terms of this Agreement which continues that shall continue unremedied for a period of two (2) three Business Days after written notice of such deposit was due or (C) the failure is received by the Servicer to make any remittances into from FIRC or the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;Collateral Agent; or
(ii) (A) The failure by Failure on the Servicer to make any required Servicing Advance which failure continues unremedied for a period part of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, to perform in any material respect, respect any other covenants, obligations covenants or agreements of the Servicer as set forth in this Agreement, which failure shall (a) materially and adversely affects affect the interests rights of the Certificateholders, continues FIRC and (b) continue unremedied for a period of sixty (60) days, after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Trustee or to the Servicer and the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen 30 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master ServicerFIRC; or
(xiii) The entry of a decree or order by a court or agency or supervisory authority having jurisdiction in the identification under premises for the appointment of a conservator, receiver, or liquidator for the Servicer in any filing pursuant to Section 404 insolvency, readjustment of debt, marshalling of assets and liabilities, or similar proceedings, or for the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any winding up or liquidation of its duties under this Agreement.affairs; or
(biv) The consent by the Servicer 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 Servicer or of or relating substantially to all of its property; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to avail itself of any applicable insolvency or reorganization statute, make an assignment for the benefit of its creditors, or voluntarily suspend payment of its obligations; then, and in each and every such case, so long as a Servicer Event of Default shall not have been remediedcured, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to FIRC may terminate all of the rights and obligations of the Servicer under this Agreement Agreement, subject to accrued compensation, rights of reimbursement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution survival of funds indemnity and limitation on the related Distribution Date and assumeliability provisions, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the SellerServicer sent by certified mail, postage prepaid, or by hand delivery. Upon the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders 's receipt of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust8.01, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Servicing Agreement (First Investors Financial Services Group Inc)
Servicer Events of Default. (a) If any one of the The following events (“and conditions shall constitute Servicer Events of Default”) shall occur and be continuingDefault hereunder:
(i) (A) The failure by on the Servicer to make any Monthly Advance which continues unremedied for a period part of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or to the Distribution Account or other applicable account in accordance with the terms of the Indenture within two Business Days following the receipt thereof any deposit monies received by the Servicer and required to be made under the terms of this Agreement deposited hereunder, which failure continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was dueunremedied;
(ii) (A) The so long as the Servicer is the Servicer hereunder, failure by on the part of the Servicer to make pay to the Trustee on the date when due in accordance with the terms hereof, any payment required to be made by the Seller pursuant to Article 4 hereof;
(iii) failure on the part of the Servicer to observe or perform in any material respect any other of their respective covenants or agreements in this Servicing Advance Agreement which failure continues unremedied for a period of sixty 30 days after the earlier of (60A) daysthe date it first becomes known to any officer of the Seller or the Servicer, or as the case may be, and (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, thereof requiring the same to be remedied, remedied shall have been given to the Servicer by the Master Servicer, the Securities Administrator Trustee;
(iv) if any representation or the Trustee or to warranty made by the Servicer and in this Servicing Agreement or in any certificate or other writing delivered pursuant hereto shall prove to be incorrect in any material respect as of the Master Servicer, time when the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%same shall have been made; provided, however, that the breach of any representation or warranty made by the Servicer in this Servicing Agreement will be deemed to be "material" only if it affects the case of a failure that cannot be cured within sixty (60) daysNoteholders, the cure period may be extended enforceability of the Indenture or of the Notes; and provided, further, that a material breach of any representation or warranty made by the Servicer in this Servicing Agreement with respect to any of the Leases or the Equipment subject thereto will not constitute a Servicer Event of Default if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator repurchases such Lease and the Trustee that the Servicer is diligently pursuing remedial actionEquipment in accordance with this Servicing Agreement;
(iiiv) The filing the entry by a court having jurisdiction of (A) a petition against decree or order for relief in respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) a court decree or agency order adjudging the Servicer bankrupt or supervisory authority having jurisdiction insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment, or composition of or in respect of the premises for the appointment of Servicer under any applicable federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of the Servicer or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of thirty (30) 60 consecutive days; or
(ivvi) The the commencement by the Servicer shall voluntarily go into liquidationof a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order for relief in respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by it of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or failure by the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing taking of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure corporate action by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end furtherance of any Servicer Term of Service, the Servicer shall be automatically terminatedsuch action.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Servicing Agreement (Charter Equipment Lease 1998-1 LLC)
Servicer Events of Default. The following events and conditions shall constitute a "Servicer Event of Default" hereunder:
(a) If any one failure on the part of the following events (“Servicer Events of Default”) shall occur and be continuing:
(i) (A) The failure by the Servicer to make any Monthly Advance which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in into the Collection Account or other applicable account within three Business Days following the Distribution Account receipt thereof any deposit monies received by Servicer (including any Lease Payments and any Non-Performing Lease Payments) and required to be deposited hereunder;
(b) so long as ILC is Servicer hereunder, failure on the part of ILC to pay to Indenture Trustee on the date when due in accordance with the terms hereof, any payment required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required Transferor pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;5.1.
(iic) failure on the part of either Servicer or (Aso long as ILC is Servicer) The failure by the Servicer ILC to make observe or perform in any required Servicing Advance material respect any other of their respective covenants or agreements in this Agreement which failure continues unremedied for a period of sixty 30 days after the earlier of (60A) daysthe date it first becomes known to any officer of Transferor or Servicer, or as the case may be, and (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, thereof requiring the same to be remedied, remedied shall have been given to the Servicer by the Master Transferor or Servicer, as the Securities Administrator or the case may be, by Indenture Trustee or Trustee, or to the Servicer and the Master Transferor or Servicer, as the Securities Administrator or the Trusteecase may be, and Indenture Trustee by any Holder of the Notes or the Certificates;
(i) if any representation or warranty made by Transferor in this Agreement or in any certificate or other writing delivered pursuant hereto or made by any successor Servicer in connection with Certificates evidencing Voting Rights such successor Servicer's assumption of at least 25%the duties of Servicer shall prove to be incorrect in any material respect as of the time when the same shall have been made; provided, howeverthat the breach of any representation or warranty made by Transferor or Servicer in this Agreement will be deemed to be "material" only if it affects Noteholders or the Certificateholders, the enforceability of the Indenture or of the Notes or the enforceability of the Trust Agreement or the Certificates; and provided, further, that a material breach of any representation or warranty made by Transferor in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate this Agreement with respect to the reasonable satisfaction any of the Master Servicer, Leases or the Securities Administrator Equipment subject thereto will not constitute a Servicer Event of Default if Transferor repurchases such Lease and the Trustee that the Servicer is diligently pursuing remedial action;Equipment in accordance with this Agreement.
(iiiii) The filing of a petition against the Servicer in entry by a court or agency or supervisory authority having jurisdiction in the premises of (A) a decree or order for the appointment relief in respect of Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) a decree or order adjudging Servicer bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment, or composition of or in respect of Servicer under any applicable federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of Servicer or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of thirty (30) 60 consecutive days; or;
(iviii) The the commencement by Servicer shall voluntarily go into liquidationof a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order for relief in respect of Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by it of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the failure by Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by Servicer in furtherance of any applicable bankruptcysuch action;
(iv) the failure of Servicer to make one or more payments due with respect to aggregate recourse debt or other obligations exceeding $1,000,000, insolvency or reorganization statutethe occurrence of any event or the existence of any condition, make an assignment for the benefit effect of which event or condition is to cause (or permit one or more persons to cause) more than $1,000,000 of aggregate recourse debt or other obligations of Servicer to become due before its creditors (or voluntarily suspend their) stated maturity or before its (or their) regularly scheduled dates of payment of its obligationsso long as such failure, event or condition shall be continuing and shall not have been waived by the Person or Persons entitled to performance; or
(v) a final judgment or judgments (or decrees or orders) for the Servicer Termination Test is failed; or
payment of money aggregating in excess of $1,000,000 and any one of such judgments (aor decrees or orders) has remained unsatisfied and in effect for any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen 60 consecutive days after the date on which written notice without a stay of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreementexecution.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Pooling and Servicing Agreement (Provident Lease Receivables Corp)
Servicer Events of Default. (a) If any one of the The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer and the Note Insurer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders of Notes evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(iii) any failure on the part of the Servicer duly to observe or perform in any material respect any other of the covenants or agreements on the part of the 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 Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(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 Servicer and such decree or order shall have remained in force, undischarged or unstayed for a period of ninety (90) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer; or's property;
(vi) the 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 12.50% of the sum of aggregate outstanding Principal Balance for the Mortgage Loans and any amount on deposit in the Pre-Funding Accounts;
(ix) if on any Payment Date, commencing in March 2001, the Twelve Month Loss Amount exceeds 2.50% of the sum of aggregate outstanding Principal Balance for the Mortgage Loans and any amount on deposit in the Pre-Funding Accounts, as of the close of business on the first day of the twelfth preceding calendar month;
(x) if on any Payment Date, the identification occurrence of a Company Stockholders' Equity Trigger; and
(xi) the occurrence of an Event of Default under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementIndenture.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Periodic Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Payment Date, the Indenture Trustee, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and to the Master Servicer shall direct Note Insurer and the Indenture Trustee to shall, with the consent of the Note Insurer, terminate all of the rights and obligations of the Servicer under this Agreement Agreement, except for the Servicer's indemnification obligation under Section 5.19, and the Successor Indenture Trustee, or a successor Servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Periodic Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor Servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (vii) of Section 7.01, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all Note Insurer or the Majority Noteholders, by notice in writing to the Servicer and a Responsible Officer of the Voting Rights) Indenture Trustee and subject to the prior written consent of the Note Insurer, in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, any removal at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given Majority Noteholders, and in writing addition to the Sellerwhatever rights such Noteholders may have at law or equity to damages, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this Agreement, except for the Servicer's indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as servicer; and (z) with respect to clauses (viii)-(x) of Section 7.01(a), the Indenture Trustee shall, but only at the direction of the Note Insurer, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement, except for the Servicer's indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to Indenture Trustee, or its designee approved by the Note Insurer, and under this Section 8.01; and, without limitation, the Successor Servicer Indenture Trustee is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the Servicer's responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer Indenture Trustee, or its designee, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Note Insurer and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Prudential Securities Secured Financing Corp)
Servicer Events of Default. (a) If any one of the The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer and the Note Insurer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders of Notes evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(iii) any failure on the part of the Servicer duly to observe or perform in any material respect any other of the covenants or agreements on the part of the 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 Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(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 Servicer and such decree or order shall have remained in force, undischarged or unstayed for a period of forty-five (45) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer's property;
(vi) the 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 Distribution Date the Rolling Three Month Delinquency Rate exceeds 12.50% of the aggregate outstanding Principal Balance of the Mortgage Loans;
(ix) if on any Distribution Date, commencing in December 2002, the Twelve Month Loss Amount exceeds 2.50% of the sum of aggregate outstanding Principal Balance for the Mortgage Loans, as of the close of business on the first day of the twelfth preceding calendar month (or, if later, the Cut-Off Date);
(x) ABFS or the Servicer shall fail to pay any principal or interest when due on any outstanding indebtedness having an aggregate principal amount in excess of $1,000,000 and such failure shall continue after the applicable grace period, if any, specified in the agreement or instrument relating to such outstanding indebtedness, or any such outstanding indebtedness of ABFS or the Servicer having an aggregate principal amount in excess of $1,000,000 shall be declared to be due and payable or required to be prepaid (other than a regular scheduled payment) prior to the date of maturity thereof;
(xi) Net Worth of ABFS on a consolidated basis shall be less than the sum of (i) $30,000,000 plus (ii) 50% of the cumulative Net Income for each fiscal quarter ending after the Closing Date (excluding any fiscal quarter for which Net Income was less than zero);
(xii) any Change of Control shall occur; or
(xxiii) the identification occurrence of an Event of Default under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementIndenture.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Periodic Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon, New York, New York time on the related Deposit fourth Business Day prior to the applicable Distribution Date, the Indenture Trustee, may, and upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and to the Master Servicer shall direct Note Insurer and the Indenture Trustee to may, and shall, at the direction of the Note Insurer (absent a Note Insurer Default), terminate all of the rights and obligations of the Servicer under this Agreement Agreement, except for the Servicer's indemnification obligation under Section 5.19, and the Successor Indenture Trustee, or a successor Servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Periodic Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor successor Servicer and (y) in with respect to any other Servicer Event of Default, the case of clause (a)(i)(C) the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all Note Insurer or the Majority Noteholders, by notice in writing to the Servicer and a Responsible Officer of the Voting Rights) Indenture Trustee and subject to the prior written consent of the Note Insurer, in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, any removal at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given Majority Noteholders, and in writing addition to the Sellerwhatever rights such Noteholders may have at law or equity to damages, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this Agreement, except for the Servicer's indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to Indenture Trustee, or such other Person as may be specified by the Note Insurer, and under this Section 8.01; and, without limitation, the Successor Servicer Indenture Trustee is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the Servicer's responsibilities and rights hereunder and the transfer of the Servicer hereundersuch responsibilities and rights to a successor Servicer, including, without limitation, the transfer to the Successor Servicer Indenture Trustee, or its designee, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Note Insurer and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Bear Stearns Asset Backed Securities Inc)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2015-A Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2015-A Exchange Note or to this 2015-A Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2015-A Exchange Note under the Basic Servicing Agreement or this 2015-A Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2015-A Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2015-A Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2015-A Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2015-A Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2015-A Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of certain Insolvency Events with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2015-A Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2015-A Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2015-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementA Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2015-A Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2015-A Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2015-A Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf terms of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwiseBasic Servicing Agreement. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2015-A Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2015-A Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2015-A Leases and other reasonable out2015-of-pocket costs A Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2015-A Leases and transferring the Mortgage Files 2015-A Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(ce) Upon Notwithstanding Section 7.01(d), if the occurrence of Indenture Trustee shall be unwilling so to act or if it is legally unable so to act, a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Successor Servicer shall be designated appointed in accordance with Section 8.04 of the Basic Servicing Agreement. Compensation for any Successor Servicer shall not be greater than that payable to act MBFS USA as initial Servicer hereunder, a “Servicer Term hereunder without the prior consent of Service”) until such time as the Master Servicer, Majority Noteholders of the Securities Administrator and the Trustee receives written direction from the Controlling Class (or Holders of Certificates evidencing at least representing not less than 51% of the Voting Rights not to deliver an Extension Noticeaggregate Certificate Percentage Interests then outstanding if the Notes are no longer Outstanding). The Indenture Trustee and such successor shall take such action, in which event the Master Servicer shall follow such direction; provided that nothing in consistent with this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service2015-A Servicing Supplement, the Servicer as shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds necessary to the obligations of Servicer hereunder, the term of the Successor Servicer or effectuate any such Person succession. The Indenture Trustee shall not be limited unless and relieved of its duties as Successor Servicer under this Section until a newly appointed Servicer Event shall have assumed the obligations and duties of Default thereafter occurs with respect the terminated Servicer under this 2015-A Servicing Supplement. Notwithstanding anything to such the contrary contained herein, in no event shall the Indenture Trustee be liable for any servicing fee or for any differential in the amount of the servicing fee paid hereunder and the amount necessary to induce any Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting act as Successor Servicer and the Person then-obligated to succeed such then-acting Servicerhereunder.
Appears in 1 contract
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2015-A)
Servicer Events of Default. (a) If any one of the The following events (“and conditions shall constitute Servicer Events of Default”) shall occur and be continuingDefault hereunder:
(i) (A) The failure by on the Servicer to make any Monthly Advance which continues unremedied for a period part of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in to the Collection Account Account, or other applicable account in accordance with the Distribution Account terms of the Indenture within three Business Days following the receipt thereof any deposit monies received by the Servicer (including, without limitation, any Lease Payments on Performing Leases or Non-Performing Leases) and required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was duedeposited thereunder and hereunder;
(ii) (A) The failure on the part of the Servicer to pay to the Trustee on the date when due in accordance with the terms hereof, any payment required to be made by the Servicer pursuant to make Section 5 hereof;
(iii) failure on the part of either the Servicer or (so long as the Originator is the Servicer) the Originator to observe or perform in any required material respect any other of their respective covenants or agreements in this Assignment and Servicing Advance Agreement or other Transaction Document which failure continues unremedied for a period of sixty 30 days after the earlier of (60A) daysthe date it first becomes known to any officer of the Originator or the Servicer, or as the case may be, and (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, thereof requiring the same to be remedied, remedied shall have been given to the Servicer Originator or the Servicer, as the case may be, by the Master ServicerTrustee, the Securities Administrator or the Trustee or to the Servicer Originator or the Servicer, as the case may be, and the Master ServicerTrustee by the Seller, the Securities Administrator Issuer, the Insurer or any holder of the Trustee, Notes;
(iv) if any representation or warranty made by the Originator in this Assignment and Servicing Agreement or in any Transaction Document or in any certificate or other writing delivered pursuant hereto or made by any Holder successor Servicer in connection with Certificates evidencing Voting Rights such successor Servicer's assumption of at least 25%the duties of the Servicer shall prove to be incorrect in any material respect as of the time when the same shall have been made; provided, however, that the breach of any representation or warranty made by the Originator or Servicer in this Assignment and Servicing Agreement will be deemed to be "material" only if it affects the Noteholders, the Insurer or the enforceability of the Indenture or of the Notes; and provided, further, that a material breach of any representation or warranty made by the Originator in this Assignment and Servicing Agreement with respect to any of the Leases or the Equipment subject thereto will not constitute a Servicer Event of Default if the Originator purchases such Lease and the Issuer's interest in the case of Equipment or substitutes a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Substitute Lease therefor in accordance with this Assignment and the Trustee that the Servicer is diligently pursuing remedial actionServicing Agreement;
(iiiv) The filing an involuntary petition or proceeding shall be filed (A) in respect of a petition against the Servicer under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) seeking a decree or order adjudging the Servicer bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, or composition of or in a court respect of the Servicer under any applicable federal or agency state law, or supervisory authority having jurisdiction in the premises for the appointment of a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of the Servicer or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and either (1) such petition shall not have been dismissed within a period of 60 consecutive days or (2) any such order for relief or decree shall be entered in any such proceeding, or any such receiver, liquidator, assignee, trustee, sequestrator or other similar official shall be appointed;
(vi) the continuance commencement by the Servicer of a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any such other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order unstayed and for relief in effect for respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a period petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by it to the filing of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by it of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or failure by the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; orsuch action;
(vii) any reduction or withdrawal of the ratings failure of the Servicer as a servicer of subprime mortgage loans by to make one or more payments due with respect to aggregate recourse debt or other recourse obligations of the Rating Agencies that maintains a servicer rating system Servicer exceeding $5,000,000, or the occurrence of any event or the existence of any condition, the effect of which event or condition is to cause (or permit one or more Persons to cause) more than $5,000,000 of aggregate recourse debt or other recourse obligations of the Servicer to become due before its (or their) stated maturity or before its (or their) regularly scheduled dates of payment so long as such failure, event or condition shall be continuing and a rating on shall not have been waived by the Certificates Person or Persons entitled to “below average” or below; orperformance;
(viii) the failure by a final judgment or judgments (or decrees or orders) against the Servicer to comply, within for the required time periods, with Section 3.09 payment of money aggregating in excess of $5,000,000 and any one of such judgments (or the certification described under Section 3.10decrees or orders) has remained unsatisfied and in effect for any period of 60 consecutive days without a stay of execution;
(ix) for any three consecutive Due Periods, the failure by average of the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied Annualized Default Rates for a period of fifteen days after the date on which written notice of such failure, requiring the same to Due Periods shall be remedied, shall have been given to the Servicer by the Master Servicergreater than 8.0%; or
(x) for any three consecutive Due Periods, the identification under any filing pursuant to Section 404 average of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every Delinquency Rates for such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 Due Periods shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationgreater than 9.0%.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Assignment and Servicing Agreement (Ikon Receivables Funding LLC)
Servicer Events of Default. (a) If any one of the The following events (“and conditions shall constitute Servicer Events of Default”) shall occur and be continuingDefault hereunder:
(i) (A) The failure by on the Servicer to make any Monthly Advance which continues unremedied for a period part of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in to the Collection Account Account, or other applicable account in accordance with the Distribution Account terms of the Indenture within three Business Days following the receipt thereof any deposit monies received by the Servicer (including, without limitation, any Lease Payments on Performing Leases or Non- Performing Leases) and required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was duedeposited thereunder and hereunder;
(ii) (A) The failure on the part of the Servicer to pay to the Trustee on the date when due in accordance with the terms hereof, any payment required to be made by the Servicer pursuant to make Section 5 hereof;
(iii) failure on the part of either the Servicer or (so long as the Originator is the Servicer) the Originator to observe or perform in any required material respect any other of their respective covenants or agreements in this Assignment and Servicing Advance Agreement which failure continues unremedied for a period of sixty 30 days after the earlier of (60A) daysthe date it first becomes known to any officer of the Originator or the Servicer, or as the case may be, and (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, thereof requiring the same to be remedied, remedied shall have been given to the Servicer Originator or the Servicer, as the case may be, by the Master ServicerTrustee, the Securities Administrator or the Trustee or to the Servicer Originator or the Servicer, as the case may be, and the Master ServicerTrustee by the Seller, the Securities Administrator Issuer, [the Insurer] or any holder of the Trustee, Notes;
(iv) if any representation or warranty made by the Originator in this Assignment and Servicing Agreement or in any certificate or other writing delivered pursuant hereto or made by any Holder successor Servicer in connection with Certificates evidencing Voting Rights such successor Servicer's assumption of at least 25%the duties of the Servicer shall prove to be incorrect in any material respect as of the time when the same shall have been made; provided, -------- however, that the breach of any representation or warranty made by the ------- Originator or Servicer in this Assignment and Servicing Agreement will be deemed to be "material" only if it affects the Noteholders, the Insurer or the enforceability of the Indenture or of the Notes; and provided, further, that a material breach of any representation or -------- ------- warranty made by the Originator in this Assignment and Servicing Agreement with respect to any of the Leases or the Equipment subject thereto will not constitute a Servicer Event of Default if the Originator purchases such Lease and the Issuer's interest in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Equipment in accordance with this Assignment and the Trustee that the Servicer is diligently pursuing remedial actionServicing Agreement;
(iiiv) The filing of a petition against the Servicer in entry by a court or agency or supervisory authority having jurisdiction in the premises of (A) a decree or order for relief in respect of the appointment Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) a decree or order adjudging the Servicer bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment, or composition of or in respect of the Servicer under any applicable federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of the Servicer or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of thirty (30) 60 consecutive days; or;
(ivvi) The the commencement by the Servicer shall voluntarily go into liquidationof a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order for relief in respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by it of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or failure by the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; orsuch action;
(vii) any reduction or withdrawal of the ratings failure of the Servicer as a servicer of subprime mortgage loans by to make one or more payments due with respect to aggregate recourse debt or other obligations exceeding $5,000,000, or the occurrence of any event or the existence of any condition, the effect of which event or condition is to cause (or permit one or more Persons to cause) more than $5,000,000 of aggregate recourse debt or other obligations of the Rating Agencies that maintains a servicer rating system Servicer to become due before its (or their) stated maturity or before its (or their) regularly scheduled dates of payment so long as such failure, event or condition shall be continuing and a rating on shall not have been waived by the Certificates Person or Persons entitled to “below average” or below; orperformance;
(viii) a final judgment or judgments (or decrees or orders) for the failure by the Servicer to comply, within the required time periods, with Section 3.09 payment of money aggregating in excess of $5,000,000 and any one of such judgments (or the certification described under Section 3.10decrees or orders) has remained unsatisfied and in effect for any period of 60 consecutive days without a stay of execution;
(ix) so long as IOS Capital is the failure by the Servicer to provideServicer, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 downgrading of the Slong-term debt rating assigned by ▇▇▇▇▇▇▇-▇▇▇▇'▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability or S&P to perform any of its duties under this Agreement.IOS Capital to Ba2 or below or BB or below, respectively;
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) abovefor any three consecutive Due Periods, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer average of the Trustee or Annualized Default Rates for such Due Periods shall be greater than 8.00%; or
(xi) for any three consecutive Due Periods, the average of the Securities Administrator of Delinquency Rates for such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 Due Periods shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationgreater than 10.00%.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Assignment and Servicing Agreement (Ikon Receivables Funding LLC)
Servicer Events of Default. (a) If any one of the The following events (shall each constitute a “Servicer Events Event of Default”) shall occur and be continuing” hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below and Delinquency Advances, which shall have no cure period), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and Indenture Trustee by the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25%; provided, however, provided however that any failed remittance cured within one Business Day of such failure shall include interest accrued at the Prime Rate (as set forth in the case Wall Street Journal) on the amount of a failure that cannot such remittance from and including the date the remittance was required to be cured within sixty (60) days, made to and including the cure period may be extended if date the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial actionremittance was actually made;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Servicer; orIndenture Trustee or to the Servicer and the Indenture Trustee by the Noteholders affected thereby evidencing Percentage Interests of at least 25%;
(xiii) any failure on the identification under part of the Servicer duly to observe or perform in any filing material respect any other of the covenants or agreements on the part of the Servicer contained in this Agreement, or the failure of any representation and warranty made pursuant to Section 404 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) days after the S▇▇▇▇▇▇▇date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by the 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-▇▇▇▇▇ Act up or liquidation of 2002 which identifies material weaknesses its affairs, shall have been entered against the Servicer and such decree or order shall have remained in connection with force, undischarged or unstayed for a period of ninety (90) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer’s ongoing evaluation property;
(vi) the Servicer shall admit in writing its inability generally to pay its debts as they become due, file a petition to take advantage of internal controls which materially and adversely affect any applicable insolvency or reorganization statute, make an assignment for the Servicer’s ability to perform any benefit of its duties under this Agreement.creditors, or voluntarily suspend payment of its obligations;
(bvii) thenif on any Payment Date the Rolling Six Month Delinquency Ratio exceeds 14%;
(viii) if on any Payment Date, the Cumulative Realized Loss Percentage exceeds the following percentages on any Payment Date during the following periods: December 2004 - November 2006 3.00 % December 2006 - November 2007 4.50 % December 2007 - November 2008 5.25 % December 2008 and in each and every such case, so thereafter 5.50 %
(ix) the occurrence of an Event of Default under the Indenture. So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Delinquency Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Payment Date, the Indenture Trustee, upon receipt of written notice or discovery actual knowledge by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct Indenture Trustee may, and upon request of the Trustee to Holders representing more than 50% of the Class Note Balance, shall, terminate all of the rights and obligations of the Servicer under this Agreement Agreement, except for the Servicer’s indemnification obligation under Section 5.19, and the Successor Servicer Indenture Trustee (if it is the successor servicer) or a successor servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Delinquency Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest as provided in Section 7.02 and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (xii) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) aboveMajority Noteholders, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the SellerServicer and a Responsible Officer of the Indenture Trustee, the Servicerand in addition to whatever rights such Noteholders may have at law or equity to damages, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer; and (z) with respect to clauses (vii)-(ix) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee shall, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to another successor servicer, and under this Section 8.01; and, without limitation, the Successor Servicer another successor servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and to pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee or another successor servicer in effecting the termination of the Servicer’s responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer another successor servicer, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with The Indenture Trustee shall promptly notify the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of DefaultDefault upon discovery or receipt of notice by a Responsible Officer of the Indenture Trustee; provided, however, the Servicer Indenture Trustee shall act as Servicer under this Agreement, subject not be obligated to monitor the right Servicer’s compliance with the terms hereof or to determine the occurrence of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such any Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminatedDefault.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Accredited Mortgage Loan Trust 2004-4)
Servicer Events of Default. (a) If any one Any of the following events (“acts or occurrences shall constitute a Servicer Events Event of Default”) shall occur and be continuing:
(i) any failure by the Servicer (A) The to deliver to the Local Bank for deposit in the Local Bank Account or (B) to deliver or cause to be delivered to the Trustee for deposit in the Collection Account, any proceeds or payments received from an Obligor or in respect of the Trust Estate and required to be so delivered under the terms of the Indenture and this Agreement that continues unremedied until 2:00 p.m., New York time, on the second successive Business Day following such failure; or provided, however, that the Trustee, upon receiving actual knowledge of such failure, shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(ii) any failure by the Servicer to deliver a Monthly Servicer's Report pursuant to Section 4.01 hereof that continues unremedied until 2:00 p.m., New York time, the following Business Day; provided, however, that if the Trustee has actual knowledge that the Servicer has not delivered such Monthly Servicer's Report by 2:00 p.m., New York time, on a Determination Date, the Trustee shall give the Servicer written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(iii) any failure by the Servicer to remit any Purchase Price received by it to the Trustee that continues unremedied until 5:00 p.m., New York time, the following Business Day; provided, however, that if the Servicer has not remitted any Purchase Price received by it to the Trustee by 3:00 p.m., New York time, on the Determination Date and the Trustee has actual knowledge that such Purchase Price has not been paid, the Trustee shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(iv) any failure by the Servicer to make remittances (other than a remittance of Purchase Price referred to in clause (iii) above) or deliver notices pursuant to Section 3.03 hereof, that continues unremedied until 2:00 p.m., New York time, of the second successive Business Day; or
(v) any Monthly Advance failure on the part of the Servicer duly to observe or perform any other covenants or agreements of the Servicer set forth in this Agreement or the Indenture or any representation or warranty of the Servicer set forth in Section 2.01 of this Agreement shall prove to be incorrect in any material respect, which failure or breach continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 30 days after the date on which the Servicer becomes aware of such failure or breach, or receives written notice of such failure, requiring the same to be remedied, shall have been given to failure or breach; or
(vi) any assignment by the Servicer to a delegate of its duties or rights under this Agreement or except as specifically permitted hereunder, or any attempt to make such an assignment; or
(vii) the entry of a decree or order for relief by the Master Servicer, the Securities Administrator or the Trustee or to a court having jurisdiction in respect of the Servicer and the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in an involuntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy, insolvency or similar law, or appointing a court receiver, liquidator, assignee, trustee, custodian, sequestrator or agency or supervisory authority having jurisdiction in the premises other similar official for the appointment Servicer or for any substantial part of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingsits property, or for ordering the winding up or liquidation of its affairs, the affairs of the Servicer and the continuance of any such decree or order unstayed and in effect effect, or failure for such petition to be dismissed, for a period of thirty (30) 60 consecutive days; or
(ivviii) The the commencement by the Servicer shall voluntarily go into liquidationof a voluntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy, insolvency, reorganization or similar law, or the consent by the Servicer to the appointment of or taking possession by a conservator conservator, receiver, liquidator, assignee, trustee, custodian, sequestrator or receiver or liquidator or other similar person official in any insolvency, readjustment of debt, marshaling of assets and liabilities liabilities, bankruptcy or similar proceedings of or relating to the Servicer or of or relating to all or substantially all a substantial part of its property, or a decree or order the making by the Servicer of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up failure by the Servicer generally to pay its debts as such debts become due or liquidation of its affairs, shall have been entered against the Servicer; or if the Servicer shall admit in writing its inability to pay its their debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing taking of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure corporate action by the Servicer to comply, within in furtherance of any of the required time periods, with Section 3.09 or the certification described under Section 3.10;foregoing; or
(ix) the failure by stockholders' equity of the Servicer to provideand its consolidated subsidiaries, within the time frame specified hereindetermined in accordance with generally accepted accounting principles, any required reports or data pertaining to the Mortgage Loansas would be shown on a consolidated balance sheet for such Persons, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Serviceris below $50,000,000; or
(x) the identification under any filing pursuant to Section 404 occurrence of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreementa Trigger Event.
(b) then, and in each and every such case, so long as If a Servicer Event of Default shall not have been remediedoccurred and be continuing, (x) with respect solely to clause (a)(i)(A) abovethe Trustee may, (1) on the related Deposit Date, and shall upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer direction of the Trustee or Holders of Notes representing not less than 66-2/3% in principal amount of the Securities Administrator Outstanding Notes of such failurethe Controlling Class, the Master Servicer shall give telephonic by notice (by no later than 5:00 p.m. New York time on such Deposit Datethe "Servicer Termination Notice") of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, given in writing to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Dateterminate all, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advancebut not less than all, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations (except as expressly provided herein) of the Servicer under this Agreement Agreement. Notwithstanding the foregoing, a delay in or failure of performance under Sections 6.01(a)(ii) or 6.01(a)(v) hereof for a period of not more than 30 days past the applicable cure period shall not constitute a Servicer Event of Default if such delay or failure could not have been prevented by the exercise of reasonable diligence by the Servicer and such delay or failure was caused by acts of declared or undeclared war, public disorder, rebellion or sabotage, epidemics, landslides, lightning, fire, hurricanes, earthquakes, floods or similar causes; provided, however, that in any event, such delay or failure shall constitute a Servicer Event of Default if it continues unremedied for a period of 30 days past the Successor applicable cure period. The preceding sentence shall not relieve the Servicer appointed from using its best efforts to perform its obligations in a timely manner in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution terms of funds on the related Distribution Date and assumethis Agreement, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and Servicer shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to provide the Trustee, terminate all the Issuer and the Noteholders with prompt notice of the rights and obligations such failure or delay by it, together with a description of the Servicer as servicer under this Agreement. its efforts to so perform its obligations.
(c) On or after the receipt by the Servicer of such written noticea Servicer Termination Notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, Agreement shall pass to and be vested in the Successor Trustee as successor Servicer unless another successor Servicer is appointed pursuant to and under this Section 8.016.02 hereof; and, without limitation, the Successor any successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the such Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage the Loan and related documentsDocuments, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator Trustee and the Trustee successor Servicer in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage LoansTrust Estate. All Servicing Transfer Costs and other reasonable out-of-pocket To assist the successor Servicer in enforcing all rights under the Contracts, the outgoing Servicer, at its own expense (including, without limitation, any costs and or expenses (including attorneys’ fees) incurred in connection associated with the termination complete transfer of all servicing data and the completion, correction or manipulation of such servicing data as may be required by the successor Servicer to correct any errors or insufficiencies in the servicing data or otherwise to enable the successor Servicer to service the Contracts properly and transferring the Mortgage Files effectively to the Successor successor Servicer in such form as the successor Servicer may reasonably request), shall transfer its records (electronic and amending this Agreement otherwise) relating to reflect such succession as Servicer pursuant to this Section 8.01 the Trust Estate and shall be paid by transfer the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, related Loan Documents (to the extent not paid held by the predecessor ServicerTrustee) and all other records, by correspondence and documents relating to the Trust prior Estate that it may possess to distributions to Certificateholders (or, if the predecessor successor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence manner and at such amounts are paid by times as the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the successor Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationreasonably request.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 20[__]-[_] Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 20[__]-[_] Exchange Note or to this 20[__]-[_] Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 20[__]-[_] Exchange Note under the Basic Servicing Agreement or this 20[__]-[_] Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 20[__]-[_] Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 20[__]-[_] Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 20[__]-[_] Servicing Agreement or any certificate, report or other writing delivered pursuant to the 20[__]-[_] Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 20[__]-[_] Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 20[__]-[_] Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 20[__]-[_] Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement20[__]-[_] Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 20[__]-[_] Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the written direction of 66 2/3% of the Holders of the Outstanding Amount [of the Controlling Class].
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 20[__]-[_] Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the written direction of 66 2/3% of the Holders of the Outstanding Amount [of the Controlling Class]) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement20[__]-[_] Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitationSection, the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 20[__]-[_] Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 20[__]-[_] Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 20[__]-[_] Leases and other reasonable out-of-pocket costs 20[__]-[_] Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 20[__]-[_] Leases and transferring the Mortgage Files 20[__]-[_] Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Servicer Events of Default. (a) If any one of the The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer and the Note Insurer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders of Notes evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(iii) any failure on the part of the Servicer duly to observe or perform in any material respect any other of the covenants or agreements on the part of the 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 Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(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 Servicer and such decree or order shall have remained in force, undischarged or unstayed for a period of sixty (60) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer's property;
(vi) the 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 Distribution Date the Rolling Six Month Delinquency Rate exceeds 12.75% of the aggregate outstanding Principal Balance for the Mortgage Loans;
(ix) if on any Distribution Date, commencing in June 2000, the Twelve Month Loss Amount exceeds 1.75% of the aggregate outstanding Principal Balance for the Mortgage Loans, as of the close of business on the first day of the twelfth preceding calendar month;
(x) if (a) on any Distribution Date occurring before June 1, 2000, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 1.00% of the Original Pool Principal Balance, (b) on any Distribution Date on or after June 1, 2000 and before June 1, 2001, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 1.50% of the Original Pool Principal Balance, (c) on any Distribution Date on or after June 1, 2001 and before June 1, 2002, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 2.25% of the Original Pool Principal Balance, (d) on any Distribution Date on or after June 1, 2002 and before June 1, 2003, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 3.00% of the Original Pool Principal Balance, or (e) on any Distribution Date on or after June 1, 2003, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 3.75% of the Original Pool Principal Balance;
(xi) the occurrence of an Event of Default under the Indenture; or
(xxii) the identification under any filing pursuant to a Servicer Extension Notice shall not have been delivered as set forth in Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement8.04 hereof.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Periodic Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Distribution Date, the Indenture Trustee, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and to the Master Servicer shall direct Note Insurer and the Indenture Trustee to shall, with the consent of the Note Insurer, terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Indenture Trustee, or a successor Servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Periodic Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor Servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (vii) of Section 7.01, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all Note Insurer or the Majority Noteholders, by notice in writing to the Servicer and a Responsible Officer of the Voting Rights) Indenture Trustee and subject to the prior written consent of the Note Insurer, in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, any removal at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given Majority Noteholders, and in writing addition to the Sellerwhatever rights such Noteholders may have at law or equity to damages, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this AgreementAgreement and in and to the Mortgage Loans and the proceeds thereof, as servicer; and (z) with respect to clauses (viii)-(x) of Section 7.01(a), the Indenture Trustee shall, but only at the direction of the Note Insurer, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to Indenture Trustee, or its designee approved by the Note Insurer, and under this Section 8.01; and, without limitation, the Successor Servicer Indenture Trustee is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the Servicer's responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer Indenture Trustee, or its designee, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Note Insurer and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Prudential Securities Secured Financing Corp)
Servicer Events of Default. (a) If any one of the following events (“Servicer Events of Default”) shall occur and be continuing:
(i) (A) The failure by the Servicer to make any Monthly Advance which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Payment Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Payment Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the CertificateholdersNoteholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, the Securities Administrator or the Indenture Trustee, by any Holder with Certificates evidencing Voting Rights the Holders of at least not less than 25%% of the aggregate Note Balance of the Notes; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Administrator, the Indenture Trustee and the Trustee Seller that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates Notes attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates Notes on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates Notes to “below average” or below; or
(viii) the failure by the Servicer to complyduly perform, within the required time periodsperiod, with its obligation to provide the annual statement of compliance described under Section 3.09 3.09, the accountant’s report described under Section 3.10 or the certification described under Section 3.103.13(e), which failure continues unremedied for a period of ten days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Indenture Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 6.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Payment Date and assume, pursuant to Section 8.026.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Indenture Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all the aggregate Note Balance of the Voting RightsNotes) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Indenture Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all the aggregate Note Balance of the Voting Rights Notes by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of CertificatesNotes, to the Indenture Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates Notes or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.016.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 6.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions payments to Certificateholders Noteholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.035.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Indenture Trustee receives written direction from the Holders of Certificates evidencing at least not less than 51% of the Voting Rights aggregate Note Balance of the Notes not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders Noteholders from directing the Indenture Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c6.01(c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Servicer Events of Default. (a) If any In case one or more of the following events (“Servicer Events of Default”) Default shall occur and be continuing, that is to say:
(i1) (A) The any failure by Servicer to deposit into the Collection Account or the Distribution Account or any failure by Servicer to make any Monthly Advance of the required payments therefrom; or
(2) any failure on the part of the Servicer duly to observe or perform in any material respect any other of the material covenants or agreements on the part of the Servicer, contained in any Basic Document to which it is a party, which continues unremedied for a period of one 30 days (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit or, in the Collection Account or the Distribution Account any deposit required to be made under the terms case of this Agreement which continues unremedied payment of insurance premiums, for a period of two (215 days) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Trustee any other party hereto or to the Servicer and (with copy to each other party hereto), by Holders of 25% of the Master Servicer, Percentage Interests of the Securities Administrator Notes or the TrusteeTrust Certificates; or
(3) any breach on the part of the Servicer of any representation or warranty contained in any Basic Document to which it is a party that materially and adversely affects the interests of any of the parties hereto or any Securityholder and which continues unremedied for a period of 30 days after the date on which notice of such breach, requiring the same to be remedied, shall have been given to the Servicer by any other party hereto or to the Servicer (with copy to each other party hereto), by any Holder with Certificates evidencing Voting Rights the Initial Noteholder or Holders of at least 25%; provided, however, that % of the Percentage Interests (as defined in the case of a failure that cannot be cured within sixty (60Indenture) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;Notes; or
(iii4) The filing of a petition against the Servicer in there shall have been commenced before a court or agency or supervisory authority having jurisdiction in the premises for an involuntary proceeding against the appointment of a trusteeServicer under any present or future federal or state bankruptcy, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities insolvency or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises law for the appointment of a conservator, receiver, liquidator liquidator, trustee or similar person official in any bankruptcy, insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, which action shall not have been entered against dismissed for a period of 60 days; or
(5) the ServicerServicer shall consent to the appointment of a conservator, receiver, liquidator, trustee or similar official in any bankruptcy, insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to it or of or relating to all or substantially all of its property; or or
(6) the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or creditors, voluntarily suspend payment of its obligations, or take any corporate action in furtherance of the foregoing; or
(v7) the Servicer Termination Test is failedReserved; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to 8) the Servicer or the servicing Loan Originator fails to comply with any of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loansits financial covenants set forth in Section 7.02; or
(vii9) any reduction or withdrawal a Change of Control of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x10) so long as the identification Servicer or the Loan Originator is an Affiliate of either of the Depositor or the Issuer and any "event of default' by any such party occurs under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementBasic Documents.
(b) thenThen, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failureMajority Noteholders, the Master Servicer shall give telephonic by notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure in writing to make a Monthly Advance to a Servicing Officer of the Servicer andmay, in addition to the extent the applicable current contact information has been provided whatever rights such Person may have at law or in equity to the Master Servicerdamages, the Servicing Rights Pledgee including injunctive relief and (2) on the Business Day immediately following the related Deposit Datespecific performance, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to may terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior and to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee Loans and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) aboveproceeds thereof, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 9.02 hereof, pass to and be vested in a successor servicer, and the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer successor servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each Mortgage Loan the Loans and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee successor servicer in effecting the termination of the Servicer's responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer successor servicer for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the each Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of (i) an Event of Default or Default under any of the Basic Documents, (ii) a Servicer Event of Default, the Servicer shall act as Servicer Default under this Agreement, subject (iii) a Rapid Amortization Trigger or (iv) a determination, reasonably made by the Initial Noteholder, that an event has occurred that shall materially impair the ability of the Servicer to service and administer the right of removal Loans in accordance with the terms and provisions set forth in subsection the Servicing Addendum (b) hereofeach, a "Term Event"), the Servicer's right to service the Loans pursuant to the terms of this Agreement shall be in effect for an initial period commencing on the date on which such Servicer Term Event of Default occurred and ending shall automatically terminate at 5:00 p.m. (New York City time), on the last business day of the calendar quarter month in which such Term Event occurred (the "Initial Term"). Thereafter, the Initial Term shall be extendible in the sole discretion of the Initial Noteholder by written notice (each, a "Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”") of the Initial Noteholder for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year successive one-month terms (each such quarterly period for which term ending at 5:00 p.m. (New York City time), on the last business day of the related month). Following a Term Event, the Servicer hereby agrees that the Servicer shall be designated bound for the duration of the Initial Term and the term covered by any such Servicer Extension Notice to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause this Agreement. Following a Term Event, the Servicer agrees that if, as of 3:00 p.m. (bNew York City time) above. In on the event the Master Servicer fails to deliver an Extension Notice prior to the end last business day of any Servicer Term of Servicemonth, the Servicer shall be automatically terminated.
(d) If not have received a Servicer Extension Notice from the Successor Initial Noteholder, the Servicer or another Person succeeds shall give written notice of such non-receipt to the obligations of Servicer hereunderInitial Noteholder by 4:00 p.m. (New York City time). Following a Term Event, the term failure of the Successor Servicer or such Person shall not be limited unless and until Initial Noteholder to deliver a Servicer Event Extension Notice by 5:00 p.m. (New York City time) shall result in the automatic and immediate termination of Default thereafter occurs with respect to such Successor the Servicer or other Person(the "Termination Date"). At such timeNotwithstanding these time frames, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated Initial Noteholder shall comply with all applicable laws in connection with such transfer and the Servicer shall continue to succeed service the Loans until completion of such then-acting Servicertransfer.
Appears in 1 contract
Servicer Events of Default. (a) If any one of the The following events (“and conditions shall constitute Servicer Events of Default”) shall occur and be continuingDefault hereunder:
(i) (A) The failure by on the Servicer to make any Monthly Advance which continues unremedied for a period part of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in to the Collection Account Account, or other applicable account in accordance with the Distribution Account terms of the Indenture within three Business Days following the receipt thereof any deposit monies received by the Servicer (including, without limitation, any Lease Payments on Performing Leases or Non-Performing Leases) and required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was duedeposited thereunder and hereunder;
(ii) (A) The failure on the part of the Servicer to pay to the Trustee on the date when due in accordance with the terms hereof, any payment required to be made by the Servicer pursuant to make Section 5 hereof;
(iii) failure on the part of either the Servicer or (so long as the Originator is the Servicer) the Originator to observe or perform in any required material respect any other of their respective covenants or agreements in this Assignment and Servicing Advance Agreement which failure continues unremedied for a period of sixty 30 days after the earlier of (60A) daysthe date it first becomes known to any officer of the Originator or the Servicer, or as the case may be, and (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, thereof requiring the same to be remedied, remedied shall have been given to the Servicer Originator or the Servicer, as the case may be, by the Master ServicerTrustee, the Securities Administrator or the Trustee or to the Servicer Originator or the Servicer, as the case may be, and the Master ServicerTrustee by the Seller, the Securities Administrator Issuer, the Insurer or any holder of the Trustee, Notes;
(iv) if any representation or warranty made by the Originator in this Assignment and Servicing Agreement or in any certificate or other writing delivered pursuant hereto or made by any Holder successor Servicer in connection with Certificates evidencing Voting Rights such successor Servicer's assumption of at least 25%the duties of the Servicer shall prove to be incorrect in any material respect as of the time when the same shall have been made; provided, however, that the breach of any representation or warranty made by the Originator or Servicer in this Assignment and Servicing Agreement will be deemed to be "material" only if it affects the Noteholders, the Insurer or the enforceability of the Indenture or of the Notes; and provided, further, that a material breach of any representation or warranty made by the Originator in this Assignment and Servicing Agreement with respect to any of the Leases or the Equipment subject thereto will not constitute a Servicer Event of Default if the Originator purchases such Lease and the Issuer's interest in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Equipment in accordance with this Assignment and the Trustee that the Servicer is diligently pursuing remedial actionServicing Agreement;
(iiiv) The filing of a petition against the Servicer in entry by a court or agency or supervisory authority having jurisdiction in the premises of (A) a decree or order for relief in respect of the appointment Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) a decree or order adjudging the Servicer bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment, or composition of or in respect of the Servicer under any applicable federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of the Servicer or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of thirty (30) 60 consecutive days; or;
(ivvi) The the commencement by the Servicer shall voluntarily go into liquidationof a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order for relief in respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by it of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or failure by the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; orsuch action;
(vii) any reduction or withdrawal of the ratings failure of the Servicer as a servicer of subprime mortgage loans by to make one or more payments due with respect to aggregate recourse debt or other obligations exceeding $5,000,000, or the occurrence of any event or the existence of any condition, the effect of which event or condition is to cause (or permit one or more Persons to cause) more than $5,000,000 of aggregate recourse debt or other obligations of the Rating Agencies that maintains a servicer rating system Servicer to become due before its (or their) stated maturity or before its (or their) regularly scheduled dates of payment so long as such failure, event or condition shall be continuing and a rating on shall not have been waived by the Certificates Person or Persons entitled to “below average” or below; orperformance;
(viii) a final judgment or judgments (or decrees or orders) for the failure by the Servicer to comply, within the required time periods, with Section 3.09 payment of money aggregating in excess of $5,000,000 and any one of such judgments (or the certification described under Section 3.10decrees or orders) has remained unsatisfied and in effect for any period of 60 consecutive days without a stay of execution;
(ix) so long as IOS Capital is the failure by the Servicer to provideServicer, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 downgrading of the Slong-term debt rating assigned by ▇▇▇▇▇▇▇-▇▇▇▇'▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability or S&P to perform any of its duties under this Agreement.IOS Capital to Ba2 or below or BB or below, respectively;
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) abovefor any three consecutive Due Periods, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer average of the Trustee or Annualized Default Rates for such Due Periods shall be greater than 8.00%; or
(xi) for any three consecutive Due Periods, the average of the Securities Administrator of Delinquency Rates for such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 Due Periods shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationgreater than 10.00%.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Assignment and Servicing Agreement (Ikon Receivables LLC)
Servicer Events of Default. Each of the following shall constitute a "Servicer Event of Default" on the part of the Servicer:
(a) If any one of the following events (“Servicer Events of Default”) shall occur and be continuing:
(i) (A) The failure by the Servicer to make observe or perform in any Monthly Advance which continues unremedied for a period material respect any of one (1) Business Day after it was due; the terms, covenants or (B) any other failure by agreements on the part of the Servicer to deposit set forth in this Agreement, any Transfer Supplement or in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Custodial Agreement which continues unremedied for a period of two (2other than those set forth in clauses (h), (i) Business Days after such deposit was due or and (Cm) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(ibelow) which continues unremedied for a period of one forty-five (145) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, days after the date on which the Servicer has actual knowledge of such failure or written notice of such failure, requiring the same failure to be remedied, shall have been given to the Servicer by the Master ServicerAdministrative Agent, the Securities Administrator Custodian or the Trustee or to the Servicer and the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial actionAgent;
(iiib) The filing of a petition against any representation, warranty, statement or certificate made by the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator shall prove to have been incorrect in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for material respect at the winding up or liquidation of its affairstime when made, and the continuance of which continues to be incorrect in any such decree material respect for 45 days after actual knowledge or order unstayed and in effect for a period of thirty (30) consecutive days; orwritten notice;
(ivc) The any failure by the Servicer shall voluntarily go into liquidation, consent to maintain any required licenses to do business in any jurisdiction where the Mortgaged Property is located;
(d) jurisdiction for the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its propertyincluding bankruptcy, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling marshalling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; Servicer and a decree or order shall have remained in force undischarged or unstayed for a period of 45 days;
(e) the 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 Servicer or of or relating to all or substantially all of its property;
(f) the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcyinsolvency, insolvency bankruptcy or reorganization statute, make an assignment for the benefit of its creditors or creditors, voluntarily suspend payment of its obligationsobligations or cease its normal business operations for six Business Days;
(g) the Servicer or PHH Corporation enters into a consent agreement or otherwise agrees in writing with any federal or state regulatory agency or authority to restrict its activities, if the default of such agreement by the Servicer or PHH Corporation entitles such applicable federal or state agency to place the Servicer in receivership or conservatorship;
(h) failure of the Servicer to deposit into the Collateral Account on the date of sale or Securitization of an Eligible Loan the proceeds of any such sale or Securitization;
(i) failure of the Servicer to deposit into the Collection Account not later than two Business Days after receipt by the Servicer of any amounts required by Section 4.5 hereof to be deposited by the Servicer in the Collection Account;
(j) the Seller, Servicer or PHH Corporation shall default on any of its debt obligations in excess of $50,000,000 in the aggregate;
(k) failure of the Servicer to be an Approved Seller/Servicer by GNMA, and at least one of FNMA and FHLMC;
(l) the ratings of PHH Corporation or its successors and assigns are withdrawn or are downgraded below "BBB-" or "Baa3" by either Rating Agency; or
(vm) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of failure on the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings part of the Servicer as a servicer of subprime mortgage loans by one to make any payment or more of the Rating Agencies that maintains a servicer rating system and a rating deposit (not described in clause (h) or (i) above) required under this Agreement on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days before five Business Days after the date on which written notice of such failure, requiring the same payment or deposit is required to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in made. In each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely in addition to clause (a)(i)(A) abovewhatsoever rights the Purchaser may have at law or in equity to damages, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failureincluding injunctive relief and specific performance, the Master Servicer shall give telephonic Administrative Agent, by notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, in writing to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee Agent, ▇▇▇▇▇'▇ and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to S&P may terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior and to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee Eligible Loans and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less proceeds thereof other than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the unpaid Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of Fees. The Administrative Agent will only remove the Servicer as servicer under this Agreementdescribed above upon the affirmative vote of the Majority Owners. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Eligible Loans or otherwise, shall pass to and be vested in the Successor Servicer successor appointed pursuant to and under this Section 8.01; and, without limitation12.1 hereof. Upon written request from the Administrative Agent, the Successor Servicer is hereby authorized and empowered to shall prepare, execute and deliver, on behalf of deliver to the Servicer, as attorney-in-fact or otherwise, successor entity designated by the Administrative Agent any and all documents and other instruments, place in such successor's possession all Mortgage Loan Files, and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether including but not limited to complete the transfer and endorsement or assignment of each Mortgage Loan the Eligible Loans and related documents, or otherwiseat the Servicer's sole expense. The Servicer agrees to shall cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee such successor in effecting the termination of the Servicer's responsibilities and rights of the Servicer hereunder, including, including without limitation, the transfer to the Successor Servicer such successor for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the any Collection Account, Account or that have been deposited by the predecessor Servicer in the Collection Escrow Account or thereafter received by the predecessor Servicer with respect to the Mortgage Eligible Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Mortgage Loan Repurchase and Servicing Agreement (PHH Corp)
Servicer Events of Default. (a) If any one of the I. The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Master Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Master Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure the date upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Master Servicer and the Note Insurer by the Indenture Trustee or to the Master Servicer to deposit in and the Collection Account Indenture Trustee by the Note Insurer or the Distribution Account any deposit required to be made under the terms Noteholders affected thereby evidencing Percentage Interests of this Agreement which continues unremedied for a period of two at least 25%;
(2) Business Days after such deposit was due or (Cii) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Master Servicer to make any required Servicing Advance Advance, which failure continues unremedied for a period of sixty thirty (6030) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 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 Master Servicer, the Securities Administrator or the Indenture Trustee or to the Master Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing any failure on the part of a petition against the Master Servicer in a court duly to observe or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator perform in any insolvency, conservatorship, receivership, readjustment material respect any other of debt, marshaling the covenants or agreements on the part of assets and liabilities or similar proceedingsthe Master Servicer contained in this Agreement, or for the winding up or liquidation of its affairs, and the continuance failure of any such decree or order unstayed representation and in effect warranty made pursuant to Section 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) consecutive days; ordays 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) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises an involuntary case under any present or future federal or state bankruptcy, insolvency or similar law or for the appointment of a conservator, receiver, liquidator conservator or similar person receiver or liquidation in any insolvency, readjustment of debt, marshaling 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; or 's property;
(vi) the Master Servicer shall admit in writing its inability generally to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors creditors, or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or;
(vii) the Note Insurer shall notify the Indenture Trustee of any reduction or withdrawal "event of default" under the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; orInsurance Agreement;
(viii) if on any Payment Date the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10Rolling Six Month Delinquency Rate exceeds 14.0%;
(ix) if on any Payment Date, the failure by Twelve Month Loss Amount exceeds 2.50% of the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to Aggregate Principal Balance of the Mortgage Loans, which failure continues unremedied for a period as of fifteen days after the date close of business on which written notice the first day of such failurethe twelfth preceding calendar month;
(x) if the total stockholders' equity of the Master Servicer, requiring the same to be remedied, shall have been given to the Servicer as determined by the Master Servicer; or
(x) 's independent accountants in accordance with generally accepted accounting principles, shall be less than the identification under any filing pursuant to Section 404 sum of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on $30 million and (2) 75% of the related Deposit Date, upon receipt of written notice or discovery by net proceeds to the Master Servicer of any initial public offering of its common stock;
(xi) if the total on- or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, off-balance sheet financing available to the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not be less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.$400 million;
(cxii) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on under the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such directionIndenture; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.or
Appears in 1 contract
Sources: Sale and Servicing Agreement (Accred Home LNDRS Inc Ac Mor Ln Tr 2002-1 as Bk Nt Se 2002-1)
Servicer Events of Default. (a) If any one of the The following events (shall each constitute a “Servicer Events Event of Default”) shall occur and be continuing” hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below and Delinquency Advances, which shall have no cure period), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and Indenture Trustee by the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25%; provided, however, provided however that any failed remittance cured within one Business Day of such failure shall include interest accrued at the Prime Rate (as set forth in the case Wall Street Journal) on the amount of a failure that cannot such remittance from and including the date the remittance was required to be cured within sixty (60) days, made to and including the cure period may be extended if date the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial actionremittance was actually made;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Servicer; orIndenture Trustee or to the Servicer and the Indenture Trustee by the Noteholders affected thereby evidencing Percentage Interests of at least 25%;
(xiii) any failure on the identification under part of the Servicer duly to observe or perform in any filing material respect any other of the covenants or agreements on the part of the Servicer contained in this Agreement, or the failure of any representation and warranty made pursuant to Section 404 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) days after the S▇▇▇▇▇▇▇date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by the 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-▇▇▇▇▇ Act up or liquidation of 2002 which identifies material weaknesses its affairs, shall have been entered against the Servicer and such decree or order shall have remained in connection with force, undischarged or unstayed for a period of ninety (90) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer’s ongoing evaluation property;
(vi) the Servicer shall admit in writing its inability generally to pay its debts as they become due, file a petition to take advantage of internal controls which materially and adversely affect any applicable insolvency or reorganization statute, make an assignment for the Servicer’s ability to perform any benefit of its duties under this Agreement.creditors, or voluntarily suspend payment of its obligations;
(bvii) thenif on any Payment Date the Rolling Six Month Delinquency Ratio exceeds 14%;
(viii) if on any Payment Date, the Cumulative Realized Loss Percentage exceeds the following percentages on any Payment Date during the following periods: March 2005 - February 2006 1.75 % March 2006 - February 2007 3.50 % March 2007 - February 2008 5.00 % March 2008 and in each and every such case, so thereafter 6.00 %
(ix) the occurrence of an Event of Default under the Indenture. So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Delinquency Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Payment Date, the Indenture Trustee, upon receipt of written notice or discovery actual knowledge by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct Indenture Trustee may, and upon request of the Trustee to Holders representing more than 50% of the Class Note Balance, shall, terminate all of the rights and obligations of the Servicer under this Agreement Agreement, except for the Servicer’s indemnification obligation under Section 5.19, and the Successor Servicer Indenture Trustee (if it is the successor servicer) or a successor servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Delinquency Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest as provided in Section 7.02 and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (xii) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) aboveMajority Noteholders, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the SellerServicer and a Responsible Officer of the Indenture Trustee, the Servicerand in addition to whatever rights such Noteholders may have at law or equity to damages, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer; and (z) with respect to clauses (vii)-(ix) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee shall, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to another successor servicer, and under this Section 8.01; and, without limitation, the Successor Servicer another successor servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and to pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee or another successor servicer in effecting the termination of the Servicer’s responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer another successor servicer, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with The Indenture Trustee shall promptly notify the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of DefaultDefault upon discovery or receipt of notice by a Responsible Officer of the Indenture Trustee; provided, however, the Servicer Indenture Trustee shall act as Servicer under this Agreement, subject not be obligated to monitor the right Servicer’s compliance with the terms hereof or to determine the occurrence of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such any Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminatedDefault.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Accredited Mortgage Loan Trust 2005-1)
Servicer Events of Default. Each of the following shall constitute a Servicer Event of Default on the part of the Servicer:
(a) If any one of the following events (“Servicer Events of Default”) shall occur and be continuing:
(i) (A) The failure by the Servicer to make remit to the Master Servicer any Monthly Advance which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit payment required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was dueAgreement;
(iib) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of the covenants or agreements on the part of the Servicer set forth in this Agreement, including, but not limited to, breach by the Servicer of any one or more of the representations, warranties and covenants of the Servicer as set forth in this AgreementSection 3.5, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 30 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator Servicer or the Trustee or to the Servicer and the Master Servicer, the Securities Administrator or the Indenture Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iiic) The filing of a petition against failure by the Servicer to maintain its license to do business in any jurisdiction where the Mortgaged Property is located if such license is required;
(d) a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, conservator or receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, including bankruptcy, marshaling of assets and liabilities or similar proceedings, or for the winding winding-up or liquidation of its affairs, shall have been entered against the Servicer and the continuance of any such decree or order shall have remained in force undischarged or unstayed and in effect for a period of thirty (30) consecutive 60 days; or;
(ive) The the Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or assets;
(f) the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcyinsolvency, insolvency bankruptcy or reorganization statute, make an assignment for the benefit of its creditors or creditors, voluntarily suspend payment of its obligations; orobligations or cease its normal business operations for three Business Days;
(vg) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally ceases to meet the Servicer eligibility qualifications of ▇▇▇▇▇▇ ▇▇▇ or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with Mac; or
(h) the Servicer’s ongoing evaluation of internal controls which materially and adversely affect Servicer attempts to assign its right to servicing compensation hereunder or to assign this Agreement or the Servicer’s ability servicing responsibilities hereunder or to perform any of delegate its duties under this Agreement.
(b) thenhereunder or any portion thereof in violation of Section 5.10. If the Servicer obtains knowledge of a Servicer Event of Default, the Servicer shall promptly notify the Master Servicer and in the Indenture Trustee. In each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely in addition to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by whatever rights the Master Servicer or a Responsible Officer of the Indenture Trustee may have at law or of the Securities Administrator of such failureequity to damages, including injunctive relief and specific performance, the Master Servicer shall give telephonic or the Indenture Trustee, by notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, in writing to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to may terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior and to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee Mortgage Loans and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreementproceeds thereof. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer successor appointed pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination6.12.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Transfer and Servicing Agreement (First NLC Securitization, Inc.)
Servicer Events of Default. (a) If any one of the The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer and the Note Insurer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders of Notes evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(iii) any failure on the part of the Servicer duly to observe or perform in any material respect any other of the covenants or agreements on the part of the 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 Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(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 Servicer and such decree or order shall have remained in force, undischarged or unstayed for a period of sixty (60) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer's property;
(vi) the 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 Distribution Date the Rolling Six Month Delinquency Rate exceeds ____% of the aggregate outstanding Principal Balance for the Mortgage Loans;
(ix) if on any Distribution Date, commencing in _______, the Twelve Month Loss Amount exceeds ____% of the aggregate outstanding Principal Balance for the Mortgage Loans, as of the close of business on the first day of the twelfth preceding calendar month;
(x) if (a) on any Distribution Date occurring before ________, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed ____% of the Original Pool Principal Balance, (b) on any Distribution Date on or after _______ and before _______, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed _____% of the Original Pool Principal Balance, (c) on any Distribution Date on or after _______ and before _______, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed ____% of the Original Pool Principal Balance, (d) on any Distribution Date on or after _______ and before _______, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed _____% of the Original Pool Principal Balance, or (e) on any Distribution Date on or after _______, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed ____% of the Original Pool Principal Balance;
(xi) the occurrence of an Event of Default under the Indenture; or
(xxii) the identification under any filing pursuant to a Servicer Extension Notice shall not have been delivered as set forth in Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement8.04 hereof.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Periodic Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Distribution Date, the Indenture Trustee, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and to the Master Servicer shall direct Note Insurer and the Indenture Trustee to shall, with the consent of the Note Insurer, terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Indenture Trustee, or a successor Servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Periodic Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor Servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (vii) of Section 7.01, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all Note Insurer or the Majority Noteholders, by notice in writing to the Servicer and a Responsible Officer of the Voting Rights) Indenture Trustee and subject to the prior written consent of the Note Insurer, in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, any removal at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given Majority Noteholders, and in writing addition to the Sellerwhatever rights such Noteholders may have at law or equity to damages, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this AgreementAgreement and in and to the Mortgage Loans and the proceeds thereof, as servicer; and (z) with respect to clauses (viii)-(x) of Section 7.01(a), the Indenture Trustee shall, but only at the direction of the Note Insurer, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to Indenture Trustee, or its designee approved by the Note Insurer, and under this Section 8.01; and, without limitation, the Successor Servicer Indenture Trustee is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the Servicer's responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer Indenture Trustee, or its designee, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Note Insurer and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Prudential Securities Secured Financing Corp)
Servicer Events of Default. (a) If any one of the The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer and the Note Insurer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders of Notes evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(iii) any failure on the part of the Servicer duly to observe or perform in any material respect any other of the covenants or agreements on the part of the 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 Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(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 Servicer and such decree or order shall have remained in force, undischarged or unstayed for a period of ninety (90) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer; or's property;
(vi) the 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 12.50% of the sum of aggregate outstanding Principal Balance for the Mortgage Loans and any amount on deposit in the Pre-Funding Accounts;
(ix) if on any Payment Date, commencing in March 2001, the Twelve Month Loss Amount exceeds 2.50% of the sum of aggregate outstanding Principal Balance for the Mortgage Loans and any amount on deposit in the Pre-Funding Accounts, as of the close of business on the first day of the twelfth preceding calendar month;
(x) if on any Payment Date, the identification occurrence of a Company Stockholder's Equity Trigger; and
(xi) the occurrence of an Event of Default under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementIndenture.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Periodic Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Payment Date, the Indenture Trustee, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and to the Master Servicer shall direct Note Insurer and the Indenture Trustee to shall, with the consent of the Note Insurer, terminate all of the rights and obligations of the Servicer under this Agreement Agreement, except for the Servicer's indemnification obligation under Section 5.19, and the Successor Indenture Trustee, or a successor Servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Periodic Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor Servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (vii) of Section 7.01, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all Note Insurer or the Majority Noteholders, by notice in writing to the Servicer and a Responsible Officer of the Voting Rights) Indenture Trustee and subject to the prior written consent of the Note Insurer, in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, any removal at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given Majority Noteholders, and in writing addition to the Sellerwhatever rights such Noteholders may have at law or equity to damages, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this Agreement, except for the Servicer's indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as servicer; and (z) with respect to clauses (viii)-(x) of Section 7.01(a), the Indenture Trustee shall, but only at the direction of the Note Insurer, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement, except for the Servicer's indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to Indenture Trustee, or its designee approved by the Note Insurer, and under this Section 8.01; and, without limitation, the Successor Servicer Indenture Trustee is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the Servicer's responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer Indenture Trustee, or its designee, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Note Insurer and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (American Business Financial Services Inc /De/)
Servicer Events of Default. (a) If any one of the The following events (shall each constitute a “Servicer Events Event of Default”) shall occur and be continuing” hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below and Delinquency Advances, which shall have no cure period), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and Indenture Trustee by the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25%; provided, however, provided however that any failed remittance cured within one Business Day of such failure shall include interest accrued at the Prime Rate (as set forth in the case Wall Street Journal) on the amount of a failure that cannot such remittance from and including the date the remittance was required to be cured within sixty (60) days, made to and including the cure period may be extended if date the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial actionremittance was actually made;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Servicer; orIndenture Trustee or to the Servicer and the Indenture Trustee by the Noteholders affected thereby evidencing Percentage Interests of at least 25%;
(xiii) any failure on the identification under part of the Servicer duly to observe or perform in any filing material respect any other of the covenants or agreements on the part of the Servicer contained in this Agreement, or the failure of any representation and warranty made pursuant to Section 404 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) days after the S▇▇▇▇▇▇▇date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by the 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-▇▇▇▇▇ Act up or liquidation of 2002 which identifies material weaknesses its affairs, shall have been entered against the Servicer and such decree or order shall have remained in connection with force, undischarged or unstayed for a period of ninety (90) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer’s ongoing evaluation property;
(vi) the Servicer shall admit in writing its inability generally to pay its debts as they become due, file a petition to take advantage of internal controls which materially and adversely affect any applicable insolvency or reorganization statute, make an assignment for the Servicer’s ability to perform any benefit of its duties under this Agreement.creditors, or voluntarily suspend payment of its obligations;
(bvii) thenif on any Payment Date the Rolling Six Month Delinquency Ratio exceeds 17%;
(viii) if on any Payment Date, the Cumulative Realized Loss Percentage exceeds the following percentages on any Payment Date during the following periods: June 2005 - May 2006 6.50 % June 2006 - May 2007 7.00 % June 2007 - May 2008 7.50 % June 2008 and in each and every such case, so thereafter 8.00 %
(ix) the occurrence of an Event of Default under the Indenture. So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Delinquency Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Payment Date, the Indenture Trustee, upon receipt of written notice or discovery actual knowledge by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct Indenture Trustee may, and upon request of the Trustee to Holders representing more than 50% of the Class Note Balance, shall, terminate all of the rights and obligations of the Servicer under this Agreement Agreement, except for the Servicer’s indemnification obligation under Section 5.19, and the Successor Servicer Indenture Trustee (if it is the successor servicer) or a successor servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Delinquency Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest as provided in Section 7.02 and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (xii) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) aboveMajority Noteholders, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the SellerServicer and a Responsible Officer of the Indenture Trustee, the Servicerand in addition to whatever rights such Noteholders may have at law or equity to damages, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer; and (z) with respect to clauses (vii)-(ix) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee shall, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to another successor servicer, and under this Section 8.01; and, without limitation, the Successor Servicer another successor servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and to pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee or another successor servicer in effecting the termination of the Servicer’s responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer another successor servicer, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Rating Agencies and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Swap Provider of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of DefaultDefault upon discovery or receipt of notice by a Responsible Officer of the Indenture Trustee; provided, however, the Servicer Indenture Trustee shall act as Servicer under this Agreement, subject not be obligated to monitor the right Servicer’s compliance with the terms hereof or to determine the occurrence of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such any Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminatedDefault.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Accredited Mortgage Loan Trust 2005-2)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 20[__]-[_] Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 20[__]-[_] Exchange Note or to this 20[__]-[_] Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 20[__]-[_] Exchange Note under the Basic Servicing Agreement or this 20[__]-[_] Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 20[__]-[_] Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 20[__]-[_] Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 20[__]-[_] Servicing Agreement or any certificate, report or other writing delivered pursuant to the 20[__]-[_] Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 20[__]-[_] Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 20[__]-[_] Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 20[__]-[_] Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement20[__]-[_] Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 20[__]-[_] Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount [of the Controlling Class].
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 20[__]-[_] Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount [of the Controlling Class]) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement20[__]-[_] Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitation7.01(a), the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 20[__]-[_] Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 20[__]-[_] Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 20[__]-[_] Leases and other reasonable out-of-pocket costs 20[__]-[_] Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 20[__]-[_] Leases and transferring the Mortgage Files 20[__]-[_] Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Servicing Supplement (Daimler Trust)
Servicer Events of Default. (a) If any one of the The following events (“and conditions shall constitute Servicer Events of Default”) shall occur and be continuingDefault hereunder:
(i) (A) The failure by on the Servicer to make any Monthly Advance which continues unremedied for a period part of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in to the Collection Account Account, or other applicable account in accordance with the Distribution Account terms of the Indenture within three Business Days following the receipt thereof any deposit monies received by the Servicer (including, without limitation, any Lease Payments and any Defaulted Lease Payments) and required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was duedeposited hereunder;
(ii) (A) The so long as the Originator is the Servicer hereunder, failure on the part of the Originator to pay to the Trustee on the date when due in accordance with the terms hereof, any payment required to be made by the Seller pursuant to Section 5 hereof;
(iii) failure on the part of either the Servicer or (so long as the Originator is the Servicer) the Originator to make observe or perform in any required material respect any other of their respective covenants or agreements in this Assignment and Servicing Advance Agreement which failure continues unremedied for a period of sixty 90 days after the earlier of (60A) daysthe date it first becomes known to any officer of the Originator, the Seller or the Servicer, as the case may be, and (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, thereof requiring the same to be remedied, remedied shall have been given to the Servicer Originator or the Servicer, as the case may be, by the Master ServicerTrustee, the Securities Administrator or the Trustee or to the Servicer Originator or the Servicer, as the case may be, and the Master Servicer, Trustee by the Securities Administrator holders of not less than 25% of the voting rights of such series of Notes;
(iv) if any representation or warranty made by the Trustee, Originator in this Assignment and Servicing Agreement or in any certificate or other writing delivered pursuant hereto or made by any Holder successor Servicer in connection with Certificates evidencing Voting Rights such successor Servicer's assumption of at least 25%the duties of the Servicer shall prove to be incorrect in any material respect as of the time when the same shall have been made; provided, however, that the breach of any representation or warranty made by the Originator or Servicer in this Assignment and Servicing Agreement will be deemed to be "material" only if it affects the case of a failure that cannot be cured within sixty (60) daysNoteholders, the cure period may be extended enforceability of the Indenture or of the Notes; and provided, further, that a material breach of any representation or warranty made by the Originator in this Assignment and Servicing Agreement with respect to any of the Leases or the Equipment subject thereto will not constitute a Servicer Event of Default if the Servicer can demonstrate Originator purchases such Lease [and Equipment] in accordance with this Assignment and Servicing Agreement or to the reasonable satisfaction of extent the Master ServicerOriginator does not purchase such Lease, if the Securities Administrator Seller purchases such Lease in accordance with this Assignment and the Trustee that the Servicer is diligently pursuing remedial action;Servicing Agreement.
(iiiv) The filing of a petition against the Servicer in entry by a court or agency or supervisory authority having jurisdiction in the premises of (A) a decree or order for relief in respect of the appointment Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) a decree or order adjudging the Servicer bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment, or composition of or in respect of the Servicer under any applicable federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of the Servicer or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of thirty (30) 60 consecutive days; or;
(ivvi) The the commencement by the Servicer shall voluntarily go into liquidationof a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order for relief in respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by it of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or failure by the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; orsuch action;
(vii) any reduction or withdrawal of the ratings failure of the Servicer as a servicer of subprime mortgage loans by to make one or more payments due with respect to aggregate recourse debt or other obligations exceeding [$5,000,000], or the occurrence of any event or the existence of any condition, the effect of which event or condition is to cause (or permit one or more persons to cause) more than [$5,000,000] of aggregate recourse debt or other obligations of the Rating Agencies that maintains a servicer rating system Servicer to become due before its (or their) stated maturity or before its (or their) regularly scheduled dates of payment so long as such failure, event or condition shall be continuing and a rating on shall not have been waived by the Certificates Person or Persons entitled to “below average” or belowperformance; or
(viii) a final judgment or judgments (or decrees or orders) for the failure by the Servicer to comply, within the required time periods, with Section 3.09 payment of money aggregating in excess of [$5,000,000] and any one of such judgments (or the certification described under Section 3.10;
(ixdecrees or orders) the failure by the Servicer to provide, within the time frame specified herein, has remained unsatisfied and in effect for any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen 60 consecutive days after the date on which written notice without a stay of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreementexecution.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Assignment and Servicing Agreement (Ikon Receivables LLC)
Servicer Events of Default. (a) If any one of the I. The following events (“Servicer Events of Default”) shall occur and be continuingeach constitute a "SERVICER EVENT OF DEFAULT" hereunder:
(i) (A) The any failure by the Master Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Master Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure the date upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Master Servicer and the Note Insurer by the Indenture Trustee or to the Master Servicer to deposit in and the Collection Account Indenture Trustee by the Note Insurer or the Distribution Account any deposit required to be made under the terms Noteholders affected thereby evidencing Percentage Interests of this Agreement which continues unremedied for a period of two at least 25%;
(2) Business Days after such deposit was due or (Cii) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Master Servicer to make any required Servicing Advance Advance, which failure continues unremedied for a period of sixty thirty (6030) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 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 Master Servicer, the Securities Administrator or the Indenture Trustee or to the Master Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing any failure on the part of a petition against the Master Servicer in a court duly to observe or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator perform in any insolvency, conservatorship, receivership, readjustment material respect any other of debt, marshaling the covenants or agreements on the part of assets and liabilities or similar proceedingsthe Master Servicer contained in this Agreement, or for the winding up or liquidation of its affairs, and the continuance failure of any such decree or order unstayed representation and in effect warranty made pursuant to Section 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) consecutive days; ordays 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) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises an involuntary case under any present or future federal or state bankruptcy, insolvency or similar law or for the appointment of a conservator, receiver, liquidator conservator or similar person receiver or liquidation in any insolvency, readjustment of debt, marshaling 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; or 's property;
(vi) the Master Servicer shall admit in writing its inability generally to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors creditors, or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or;
(vii) the Note Insurer shall notify the Indenture Trustee of any reduction or withdrawal "event of default" under the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; orInsurance Agreement;
(viii) if on any Payment Date the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10Rolling Three Month Delinquency Rate exceeds 5.0%;
(ix) if on any Payment Date, Twelve Month Loss Amount exceeds 1.50% of the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to Aggregate Principal Balance of the Mortgage Loans, which failure continues unremedied for a period as of fifteen days the close of business on the later of April 1, 2000 and the first day of the twelfth preceding calendar month;
(x) if (a) on any Payment Date occurring before March 1, 2001, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 1.25% of the Cut-Off Date Aggregate Principal Balance of the Mortgage Loans in both Loan Groups, (b) on any Payment Date after March 1, 2001 and before March 1, 2002, the date aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 1.75% of the Cut-Off Date Aggregate Principal Balance of the Mortgage Loans in both Loan Groups, (c) on which written notice any Payment Date on or after March 1, 2002 and before March 1, 2003, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 2.75% of such failurethe Cut-Off Date Aggregate Principal Balance of the Mortgage Loans in both Loan Groups, requiring (d) on any Payment Date on or after March 1, 2003 and before March 1, 2004, the same to be remediedaggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 3.50% of the Cut-Off Date Aggregate Principal Balance of the Mortgage Loans in both Loan Groups, shall have been given to or (e) on any Payment Date on or after March 1, 2004, the Servicer by aggregate Cumulative Loan Losses since the Master ServicerInitial Cut-Off Date exceed 4.50% of the Cut-Off Date Aggregate Principal Balance of the Mortgage Loans in both Loan Groups;
(xi) the occurrence of an Event of Default under the Indenture; or
(xxii) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer Event of Default Extension Notice shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer delivered as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) n Section 8.04 hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Accredited Home Lenders Inc)
Servicer Events of Default. (a) If any one of the The following events (shall each constitute a “Servicer Events Event of Default”) shall occur and be continuing” hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below and Delinquency Advances, which shall have no cure period), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and Indenture Trustee by the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25%; provided, however, provided however that any failed remittance cured within one Business Day of such failure shall include interest accrued at the Prime Rate (as set forth in the case Wall Street Journal) on the amount of a failure that cannot such remittance from and including the date the remittance was required to be cured within sixty (60) days, made to and including the cure period may be extended if date the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial actionremittance was actually made;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Servicer; orIndenture Trustee or to the Servicer and the Indenture Trustee by the Noteholders affected thereby evidencing Percentage Interests of at least 25%;
(xiii) any failure on the identification under part of the Servicer duly to observe or perform in any filing material respect any other covenants or agreements on the part of the Servicer contained in this Agreement, or the failure of any representation and warranty made pursuant to Section 404 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) days after the S▇▇▇▇▇▇▇date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by the 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-▇▇▇▇▇ Act up or liquidation of 2002 which identifies material weaknesses its affairs, shall have been entered against the Servicer and such decree or order shall have remained in connection with force, undischarged or unstayed for a period of ninety (90) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer’s ongoing evaluation property;
(vi) the Servicer shall admit in writing its inability generally to pay its debts as they become due, file a petition to take advantage of internal controls which materially and adversely affect any applicable insolvency or reorganization statute, make an assignment for the Servicer’s ability to perform any benefit of its duties under this Agreement.creditors, or voluntarily suspend payment of its obligations;
(bvii) thenif on any Payment Date the Rolling Six Month Delinquency Ratio exceeds 23.80%;
(viii) if on any Payment Date, the Cumulative Realized Loss Percentage exceeds the following percentages on any Payment Date during the following periods: April 2009 to March 2010 6.50 % April 2010 to March 2011 7.00 % April 2011 to March 2012 7.50 % April 2012 and in each and every such case, so thereafter 8.00 %
(ix) the occurrence of an Event of Default under the Indenture. So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Delinquency Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Payment Date, the Indenture Trustee, upon receipt of written notice or discovery actual knowledge by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct Indenture Trustee may, and upon request of the Trustee to Holders representing more than 50% of the Class Note Balance, shall, terminate all of the rights and obligations of the Servicer under this Agreement Agreement, except for the Servicer’s indemnification obligation under Section 5.19, and the Successor Servicer Indenture Trustee (if it is the successor servicer) or a successor servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Delinquency Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest as provided in Section 7.02 and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (xii) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) aboveMajority Noteholders, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the SellerServicer and a Responsible Officer of the Indenture Trustee, the Servicerand in addition to whatever rights such Noteholders may have at law or equity to damages, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer; and (z) with respect to clauses (vii)-(ix) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee shall, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to another successor servicer, and under this Section 8.01; and, without limitation, the Successor Servicer another successor servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and to pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee or another successor servicer in effecting the termination of the Servicer’s responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer another successor servicer, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Rating Agencies and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Swap Provider of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of DefaultDefault upon discovery or receipt of notice by a Responsible Officer of the Indenture Trustee; provided, however, the Servicer Indenture Trustee shall act as Servicer under this Agreement, subject not be obligated to monitor the right Servicer’s compliance with the terms hereof or to determine the occurrence of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such any Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminatedDefault.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Accredited Mortgage Loan REIT Trust)
Servicer Events of Default. (a) If any one Any of the following events (“acts or occurrences shall constitute a Servicer Events Event of Default”) shall occur and be continuing:
: (i) Any failure by the Servicer to deliver to the Trustee for payment to Certificateholders any proceeds or payments received from a Customer or in respect of the Trust Estate and required to be so delivered under the terms of the Trust and Security Agreement and this Agreement that continues unremedied until 10:00 a.m. (AMinneapolis time) The on the following Business Day; provided, however, that the Trustee, upon receiving actual knowledge of such failure, shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or (ii) Any failure by the Servicer to deliver a Monthly Servicer's Report pursuant to Section 4.01 hereof that continues unremedied until 10:00 a.m., Minneapolis time, the following Business Day; provided, however, that if the Servicer has not delivered the Monthly Servicer's Report by 12:00 noon (Minneapolis time) on the Determination Date, the Trustee shall give the Servicer notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or (iii)Any failure by the Servicer to make a Servicer Advance pursuant to Section 3.04 hereof or to deposit any Removal Price received by it that continues unremedied until 10:00 a.m. (Minneapolis time) the following Business Day; provided, however, that if the Servicer has not made the Servicer Advance or deposited any Removal Price received by it by 12:00 noon (Minneapolis time) on the Determination Date and the Trustee has received written notification from the Servicer by way of the Monthly Servicer's Report or otherwise that such Servicer Advance or Removal Price is to be paid, the Trustee shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or (iv) Any failure on the part of the Servicer in its capacity as such duly to observe or perform in any material respect any other covenants or agreements of the Servicer set forth in this Agreement or the Trust and Security Agreement, as the case may be, or if any representation or warranty of the Servicer set forth in Section 2.01 of this Agreement shall prove to be incorrect, which failure or breach (A) materially and adversely affects or could affect the interest or rights of MBIA, the Trustee, or the Certificateholders and (B) continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 30 days after the date on which the Servicer becomes aware of such failure or breach or written notice of such failurefailure or breach, requiring the same situation giving rise to such breach or non-conformity to be remedied, shall have been given to a Servicing Officer of the Servicer by the Master Trustee, MBIA, the Transferor, or the Back-up Servicer, the Securities Administrator or the Trustee or to a Servicing Officer of the Servicer and the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator MBIA and the Trustee that by Holders of Certificates representing not less than 25% of the Certificate Balance; or (v) Any assignment by the Servicer is diligently pursuing remedial action;
to a delegate of its duties or rights under this Agreement, except as specifically permitted hereunder, or any attempt to make such an assignment; or (iiivi) The filing entry of a decree or order for relief by a court having jurisdiction in respect of the Servicer or a petition against the Servicer in an involuntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy insolvency or similar law, or appointing a court conservator, receiver, liquidator, assignee, trustee, custodian, sequestrator or agency or supervisory authority having jurisdiction in the premises other similar official for the appointment Servicer or for any substantial part of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingsits property, or for ordering the winding up or liquidation of its affairs, the affairs of the Servicer and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) 60 consecutive days; or
or (iv) The vii)The commencement by the Servicer shall voluntarily go into liquidationof a voluntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy, insolvency, reorganization or similar law, or the consent by the Servicer to the appointment of or taking possession by a conservator conservator, receiver, liquidator, assignee, trustee, custodian, sequestrator or receiver or liquidator or other similar person official in any insolvency, readjustment of debt, marshaling of assets and liabilities liabilities, bankruptcy or similar proceedings of or relating to the Servicer or of or relating to all or substantially all a substantial part of its property, or a decree or order the making by the Servicer of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up failure by the Servicer generally to pay its debts as such debts become due or liquidation of its affairs, shall have been entered against the Servicer; or if the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing taking of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure corporate action by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, in furtherance of any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
foregoing; or (b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties viii)The occurrence of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, Trigger Event if the predecessor initial Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 20[__]-[_] Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 20[__]-[_] Exchange Note or to this 20[__]-[_] Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 20[__]-[_] Exchange Note under the Basic Servicing Agreement or this 20[__]-[_] Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 20[__]-[_] Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 20[__]-[_] Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 20[__]-[_] Servicing Agreement or any certificate, report or other writing delivered pursuant to the 20[__]-[_] Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 20[__]-[_] Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 20[__]-[_] Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 20[__]-[_] Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement20[__]-[_] Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 20[__]-[_] Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount [of the Controlling Class].
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 20[__]-[_] Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount [of the Controlling Class]) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement20[__]-[_] Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitation7.01(a), the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 20[__]-[_] Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 20[__]-[_] Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 20[__]-[_] Leases and other reasonable out-of-pocket costs 20[__]-[_] Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 20[__]-[_] Leases and transferring the Mortgage Files 20[__]-[_] Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses.
(e) Notwithstanding Section 7.01(d), if the Indenture Trustee shall be unwilling so to act or if it is legally unable so to act, a Successor Servicer shall be appointed in accordance with Section 8.04 of the Basic Servicing Agreement. If Compensation for any Successor Servicer shall not be greater than that payable to MBFS USA as initial Servicer hereunder without the predecessor prior consent of the Majority Noteholders [of the Controlling Class] (or Holders of Certificates representing not less than 51% of the aggregate Certificate Percentage Interests then outstanding if the Notes are no longer Outstanding). The Indenture Trustee and such successor shall take such action, consistent with this 20[__]-[_] Servicing Supplement, as shall be necessary to effectuate any such succession. The Indenture Trustee shall not be relieved of its duties as Successor Servicer is required but fails under this Section until a newly appointed Servicer shall have assumed the obligations and duties of the terminated Servicer under this 20[__]-[_] Servicing Supplement. Notwithstanding anything to pay the amounts specified contrary contained herein, in no event shall the Indenture Trustee be liable for any servicing fee or for any differential in the preceding sentence and such amounts are amount of the servicing fee paid by the Trusthereunder, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action amount necessary to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding induce any termination of the activities of the Successor Servicer to act as Successor Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion responsibilities of the Servicing Fees to which Servicer set forth in Sections 3.05 and 3.10, or the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, obligations with respect to events occurring prior to such termination.
the payment or reimbursement of fees, expenses or other amounts (cincluding indemnities other than those resulting from the actions of the Indenture Trustee as successor Servicer) Upon of the occurrence of a Servicer Event of DefaultTrustees or the Asset Representations Reviewer, the Servicer shall act as Servicer under this Agreementfees and expenses of the Trustees’ attorneys, subject or the Asset Representations Reviewer’s attorneys, the fees and expenses of any custodian and the fees and expenses of independent accountants or expenses incurred in connection with distributions and reports to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) aboveNoteholders. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.ARTICLE EIGHT
Appears in 1 contract
Sources: Servicing Supplement (Daimler Trust)
Servicer Events of Default. (a) If any one of the The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee or any Monthly Advance other party any payment required to be made by the Servicer under the terms of this Agreement or any other Basic Document (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer and the Note Insurer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial actionNote Insurer;
(iiiii) The filing of a petition against the failure by the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in to make any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect required Servicing Advance which failure continues unremedied for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Indenture Trustee or to the Servicer and the Indenture Trustee by the Note Insurer;
(iii) any failure on the part of the Servicer duly to observe or perform in any material respect any other of the covenants or agreements on the part of the Servicer contained in this Agreement, or the failure of any representation and warranty made pursuant to Section 3.02 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 Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by the Note Insurer;
(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 Servicer or ABFS and such decree or order shall have remained in force, undischarged or unstayed for a period of forty-five (45) days;
(v) the 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 Servicer or ABFS or of or relating to all or substantially all of the Servicer's or ABFS property;
(vi) the Servicer or ABFS 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) a Trigger Event shall occur;
(ix) ABFS shall breach any of the financial covenants set forth in Section 5.06 herein;
(x) a Change of Control shall occur;
(xi) ABFS or the Servicer shall pay any Subordinated Debt in advance of their stated maturity or, after a Default or Event of Default under the Basic Agreements has occurred, make any payment of any kind on any Subordinated Debt until all of the obligations have been paid and performed in full; or ABFS shall permit the outstanding principal balance of its Subordinated Debt at any time to be more than 10% lower than the outstanding principal balance at the end of the last fiscal quarter;
(xii) ABFS or the Servicer permit the Eligible Liquid Assets of ABFS (and its subsidiaries, on a consolidated basis) at the end of any calendar quarter to be less than 30% of the amount of principal scheduled to become due on the subordinated debt in the next three (3) months;
(xiii) ABFS or the Servicer shall fail to pay any principal or interest when due on any outstanding indebtedness having an aggregate principal amount in excess of $1,000,000 and such failure shall continue after the applicable grace period, if any, specified in the agreement or instrument relating to such outstanding indebtedness, or any such outstanding indebtedness of ABFS or the Servicer having an aggregate principal amount in excess of $1,000,000 shall be declared to be due and payable or required to be prepaid (other than a regularly scheduled payment) prior to the date of maturity thereof; or
(xxiv) the identification occurrence of an Event of Default under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementIndenture.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 9.01(a)(i), (1) if such payment is in respect of Periodic Advances owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Payment Date, the Indenture Trustee, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer, Back-up Servicer and to the Master Servicer shall direct Note Insurer and the Indenture Trustee to shall, with the consent of the Controlling Party, terminate all of the rights and obligations of the Servicer under this Agreement Agreement, except for the Servicer's indemnification obligation under Section 7.19, and the Successor Back-up Servicer appointed in accordance with Section 8.02 shall become the Servicer and shall immediately make such Monthly Periodic Advance prior to the distribution of funds (based on the related Distribution Date best information available to it at the time) and assume, pursuant to Section 8.029.02 hereof, the duties of a Successor Servicer and successor Servicer; (y) with respect to that portion of Section 9.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to all other clauses of Section 9.01, the Indenture Trustee and the Depositor may (and shall shall, but only at the written direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) aboveControlling Party, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the SellerServicer and a Responsible Officer of the Indenture Trustee, and in addition to whatever rights such Noteholder or the ServicerNote Insurer may have at law or equity to damages, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this Agreement, except for the Servicer's indemnification obligations under Section 7.19, and in and to the Mortgage Loans and the proceeds thereof, as servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to Back-up Servicer, or its designee approved by the Controlling Party, and under this Section 8.01; and, without limitation, the Successor Back-up Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate with (and pay any reasonable out-of-pocket related costs and expenses incurred by) the Successor Servicer, the Master Servicer, the Securities Administrator Indenture Trustee and the Trustee Back-up Servicer in effecting the termination of the Servicer's responsibilities and rights hereunder and the transfer of such responsibilities to the Servicer hereunderBack-up Servicer, including, without limitation, the transfer to the Successor Back-up Servicer for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable outThe Indenture Trustee shall promptly notify the Note Insurer, Back-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the up Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days Rating Agencies of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (American Business Financial Services Inc /De/)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2015-B Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2015-B Exchange Note or to this 2015-B Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2015-B Exchange Note under the Basic Servicing Agreement or this 2015-B Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2015-B Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2015-B Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2015-B Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2015-B Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2015-B Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of certain Insolvency Events with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2015-B Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2015-B Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2015-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementB Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2015-B Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2015-B Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2015-B Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf terms of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwiseBasic Servicing Agreement. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2015-B Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2015-B Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2015-B Leases and other reasonable out2015-of-pocket costs B Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2015-B Leases and transferring the Mortgage Files 2015-B Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(ce) Upon Notwithstanding Section 7.01(d), if the occurrence of Indenture Trustee shall be unwilling so to act or if it is legally unable so to act, a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Successor Servicer shall be designated appointed in accordance with Section 8.04 of the Basic Servicing Agreement. Compensation for any Successor Servicer shall not be greater than that payable to act MBFS USA as initial Servicer hereunder, a “Servicer Term hereunder without the prior consent of Service”) until such time as the Master Servicer, Majority Noteholders of the Securities Administrator and the Trustee receives written direction from the Controlling Class (or Holders of Certificates evidencing at least representing not less than 51% of the Voting Rights not to deliver an Extension Noticeaggregate Certificate Percentage Interests then outstanding if the Notes are no longer Outstanding). The Indenture Trustee and such successor shall take such action, in which event the Master Servicer shall follow such direction; provided that nothing in consistent with this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service2015-B Servicing Supplement, the Servicer as shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds necessary to the obligations of Servicer hereunder, the term of the Successor Servicer or effectuate any such Person succession. The Indenture Trustee shall not be limited unless and relieved of its duties as Successor Servicer under this Section until a newly appointed Servicer Event shall have assumed the obligations and duties of Default thereafter occurs with respect the terminated Servicer under this 2015-B Servicing Supplement. Notwithstanding anything to such the contrary contained herein, in no event shall the Indenture Trustee be liable for any servicing fee or for any differential in the amount of the servicing fee paid hereunder and the amount necessary to induce any Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting act as Successor Servicer and the Person then-obligated to succeed such then-acting Servicerhereunder.
Appears in 1 contract
Sources: Servicing Supplement (Mercedes-Benz Auto Lease Trust 2015-B)
Servicer Events of Default. (a) If any one of the I. The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Master Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Master Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure the date upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Master Servicer and the Note Insurer by the Indenture Trustee or to the Master Servicer to deposit in and the Collection Account Indenture Trustee by the Note Insurer or the Distribution Account any deposit required to be made under the terms Noteholders affected thereby evidencing Percentage Interests of this Agreement which continues unremedied for a period of two at least 25%;
(2) Business Days after such deposit was due or (Cii) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Master Servicer to make any required Servicing Advance Advance, which failure continues unremedied for a period of sixty thirty (6030) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 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 Master Servicer, the Securities Administrator or the Indenture Trustee or to the Master Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing any failure on the part of a petition against the Master Servicer in a court duly to observe or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator perform in any insolvency, conservatorship, receivership, readjustment material respect any other of debt, marshaling the covenants or agreements on the part of assets and liabilities or similar proceedingsthe Master Servicer contained in this Agreement, or for the winding up or liquidation of its affairs, and the continuance failure of any such decree or order unstayed representation and in effect warranty made pursuant to Section 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) consecutive days; ordays 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) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises an involuntary case under any present or future federal or state bankruptcy, insolvency or similar law or for the appointment of a conservator, receiver, liquidator conservator or similar person receiver or liquidation in any insolvency, readjustment of debt, marshaling 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; or 's property;
(vi) the Master Servicer shall admit in writing its inability generally to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors creditors, or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or;
(vii) the Note Insurer shall notify the Indenture Trustee of any reduction or withdrawal "event of default" under the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; orInsurance Agreement;
(viii) if on any Payment Date the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10Rolling Three Month Delinquency Rate exceeds 14.0%;
(ix) if on any Payment Date, the failure by Twelve Month Loss Amount exceeds 2.50% of the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to Aggregate Principal Balance of the Mortgage Loans, which failure continues unremedied for a period as of fifteen days after the date close of business on which written notice the first day of such failurethe twelfth preceding calendar month;
(x) if the total stockholders' equity of the Master Servicer, requiring the same to be remedied, shall have been given to the Servicer as determined by the Master Servicer; or
(x) 's independent accountants in accordance with generally accepted accounting principles, shall be less than the identification under any filing pursuant to Section 404 sum of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on $30 million and (2) 75% of the related Deposit Date, upon receipt of written notice or discovery by net proceeds to the Master Servicer of any initial public offering of its common stock;
(xi) if the total on- or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, off-balance sheet financing available to the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not be less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.$400 million;
(cxii) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on under the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such directionIndenture; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.or
Appears in 1 contract
Sources: Sale and Servicing Agreement (Accred Home LNDRS Inc Ac Mor Ln Tr 2002-1 as Bk Nt Se 2002-1)
Servicer Events of Default. (a) If any one of the I. The following events (shall each constitute a “Servicer Events Event of Default”) shall occur and be continuing” hereunder:
(i) (A) The any failure by the Master Servicer to make remit to the Indenture Trustee any Monthly Advance 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 Advances, which shall have no cure period), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure 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 to deposit and Indenture Trustee by the Noteholders affected thereby evidencing Percentage Interests of at least 25%; provided however that any failed remittance cured within one Business Day of such failure shall include interest accrued at the Prime Rate (as set forth in the Collection Account or Wall Street Journal) on the Distribution Account any deposit amount of such remittance from and including the date the remittance was required to be made under to and including the terms of this Agreement which continues unremedied for a period of two date the remittance was actually made;
(2) Business Days after such deposit was due or (Cii) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Master Servicer to make any required Servicing Advance Advance, which failure continues unremedied for a period of sixty thirty (6030) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 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 Master Servicer, the Securities Administrator or the Indenture Trustee or to the Master Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing any failure on the part of a petition against the Master Servicer in a court duly to observe or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator perform in any insolvency, conservatorship, receivership, readjustment material respect any other of debt, marshaling the covenants or agreements on the part of assets and liabilities or similar proceedingsthe Master Servicer contained in this Agreement, or for the winding up or liquidation of its affairs, and the continuance failure of any such decree or order unstayed representation and in effect warranty made pursuant to Section 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) consecutive days; ordays 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 Noteholders affected thereby evidencing Percentage Interests of at least 25%;
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises an involuntary case under any present or future federal or state bankruptcy, insolvency or similar law or for the appointment of a conservator, receiver, liquidator conservator or similar person receiver or liquidation in any insolvency, readjustment of debt, marshaling 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; or ’s property;
(vi) the Master Servicer shall admit in writing its inability generally to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors creditors, or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or;
(vii) if on any reduction or withdrawal of Payment Date the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; orRolling Six Month Delinquency Ratio exceeds 14.0%;
(viii) if on any Payment Date, the failure by Cumulative Loan Loss Percentage exceeds the Servicer to comply, within following percentages on any Payment Date during the required time following periods, with Section 3.09 or the certification described under Section 3.10;: August 2004 - July 2006 1.70 % August 2006 - July 2007 2.50 % August 2007 - July 2008 3.20 % August 2008 and thereafter 4.50 %
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period occurrence of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer an Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on under the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationIndenture.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Accredited Mortgage Loan Trust 2004-3)
Servicer Events of Default. (a) If any one of the I. The following events (shall each constitute a “Servicer Events Event of Default”) shall occur and be continuing” hereunder:
(i) (A) The any failure by the Master Servicer to make remit to the Indenture Trustee any Monthly Advance 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 Periodic Advances, which shall have no cure period), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure 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 to deposit in and Indenture Trustee by the Collection Account Note Insurer or the Distribution Account any deposit required to be made under the terms Noteholders affected thereby evidencing Percentage Interests of this Agreement which continues unremedied for a period of two at least 25%;
(2) Business Days after such deposit was due or (Cii) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Master Servicer to make any required Servicing Advance Advance, which failure continues unremedied for a period of sixty thirty (6030) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 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 Master Servicer, the Securities Administrator or the Indenture Trustee or to the Master Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing any failure on the part of a petition against the Master Servicer in a court duly to observe or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator perform in any insolvency, conservatorship, receivership, readjustment material respect any other of debt, marshaling the covenants or agreements on the part of assets and liabilities or similar proceedingsthe Master Servicer contained in this Agreement, or for the winding up or liquidation of its affairs, and the continuance failure of any such decree or order unstayed representation and in effect warranty made pursuant to Section 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) consecutive days; ordays 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) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises an involuntary case under any present or future federal or state bankruptcy, insolvency or similar law or for the appointment of a conservator, receiver, liquidator conservator or similar person receiver or liquidation in any insolvency, readjustment of debt, marshaling 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; or ’s property;
(vi) the Master Servicer shall admit in writing its inability generally to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors creditors, or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or;
(vii) the Note Insurer shall notify the Indenture Trustee of any reduction or withdrawal “event of default” under the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; orInsurance Agreement;
(viii) if on any Payment Date the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10Rolling Six Month Delinquency Rate exceeds 14.0%;
(ix) if on any Payment Date, the failure by Twelve Month Loss Amount exceeds 2.50% of the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to Aggregate Principal Balance of the Mortgage Loans, which failure continues unremedied for a period as of fifteen days after the date close of business on which written notice the first day of such failurethe twelfth preceding calendar month;
(x) if the total stockholders’ equity of the Master Servicer, requiring the same to be remedied, shall have been given to the 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
(xxii) the identification under any filing pursuant to Section 404 occurrence of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer an Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on under the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationIndenture.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Accredited Mortgage Loan Trust 2003-2)
Servicer Events of Default. (a) If any one of the The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer and the Note Insurer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders of Notes evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(iii) any failure on the part of the Servicer duly to observe or perform in any material respect any other of the covenants or agreements on the part of the 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 Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(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 Servicer and such decree or order shall have remained in force, undischarged or unstayed for a period of sixty (60) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer's property;
(vi) the 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 Distribution Date the Rolling Six Month Delinquency Rate exceeds 12.75% for Mortgage Loan Pool I and 12.75% for Mortgage Loan Pool II;
(ix) if on any Distribution Date, commencing in December 1999, the Twelve Month Loss Amount exceeds 1.75% of the aggregate outstanding Principal Balance for the Mortgage Loans in Pool I and 1.75% for the Mortgage Loans in Pool II, as of the close of business on the first day of the twelfth preceding calendar month;
(x) if (a) on any Distribution Date occurring before December 1, 1999, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 1.00% of the Original Pool Principal Balance, (b) on any Distribution Date on or after December 1, 1999 and before December 1, 2000, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 1.50% of the Original Pool Principal Balance, (c) on any Distribution Date on or after December 1, 2000 and before December 1, 2001, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 2.25% of the Original Pool Principal Balance, (d) on any Distribution Date on or after December 1, 2001 and before December 1, 2002, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 3.00% of the Original Pool Principal Balance, or (e) on any Distribution Date on or after December 1, 2002, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 3.75% of the Original Pool Principal Balance;
(xi) the occurrence of an Event of Default under the Indenture; or
(xxii) the identification under any filing pursuant to a Servicer Extension Notice shall not have been delivered as set forth in Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement8.04 hereof.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Periodic Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Distribution Date, the Indenture Trustee, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and to the Master Servicer shall direct Note Insurer and the Indenture Trustee to shall, with the consent of the Note Insurer, terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Indenture Trustee, or a successor Servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Periodic Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor Servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (vii) of Section 7.01, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all Note Insurer or the Majority Noteholders, by notice in writing to the Servicer and a Responsible Officer of the Voting Rights) Indenture Trustee and subject to the prior written consent of the Note Insurer, in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, any removal at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given Majority Noteholders, and in writing addition to the Sellerwhatever rights such Noteholders may have at law or equity to damages, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this AgreementAgreement and in and to the Mortgage Loans and the proceeds thereof, as servicer; and (z) with respect to clauses (viii)-(x) of Section 7.01(a), the Indenture Trustee shall, but only at the direction of the Note Insurer, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to Indenture Trustee, or its designee approved by the Note Insurer, and under this Section 8.01; and, without limitation, the Successor Servicer Indenture Trustee is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the Servicer's responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer Indenture Trustee, or its designee, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Note Insurer and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Prudential Securities Secured Financing Corp)
Servicer Events of Default. (a) If any one of the The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made, including without limitation any Servicing Advance, by the Servicer under the terms of this Agreement or the Basic Documents;
(ii) any failure on the part of the Servicer duly to observe or perform in any material respect any other of the covenants or agreements on the part of the Servicer contained in this Agreement, or the failure of any representation and warranty made pursuant to Section 3.02 hereof to be true and correct which continues unremedied for a period of one thirty (130) Business Day days (or in the case of failure to pay insurance premiums, 15 days) after it was due; or (Bx) any other failure actual knowledge thereof by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (Cy) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, the Securities Administrator Indenture Trustee by any Noteholder or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial actionNote Purchaser;
(iii) The filing of a petition against any failure by the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator to maintain any required licenses to do business in any insolvencyjurisdiction where the property is located, conservatorship, receivership, readjustment which failure has a material adverse effect on the ability of debt, marshaling the Servicer to perform its functions under this Agreement or materially impairs the value of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairsMortgage Loans, and the continuance of any such decree or order unstayed and in effect which continues to be unremedied for a period of thirty (30) consecutive days; ordays after the date on which the Servicer has actual knowledge or written notice of such failure;
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises an involuntary case under any present or future federal or state bankruptcy, insolvency or similar law or for the appointment of a conservator, receiver, liquidator conservator or similar person receiver or liquidation in any insolvency, readjustment of debt, marshaling marshalling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer and such decree or order shall have remained in force, undischarged or unstayed for a period of thirty (30) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer; or 's property;
(vi) the Servicer shall admit in writing its inability generally to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors creditors, or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction obligations or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; orcease its normal business operations;
(vii) the Note Purchaser shall notify the Indenture Trustee of any reduction or withdrawal "event of default" under the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; orPurchase Agreement;
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10a Performance Trigger Event occurs;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same fails to be remedied, shall have been given to the Servicer by the Master an Eligible Servicer; or;
(x) the identification under any filing pursuant Sponsor shall fail to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially either (i) possess sufficient net capital and adversely affect the Servicer’s liquid assets (or ability to perform access the same) to satisfy its debts and other obligations as they become due in the normal course of business, including a minimum balance of cash or cash equivalents no less than $25 million during the Commitment Term or (ii) maintain Net Worth of no less than $35 million;
(xi) the Sponsor defaults on any of its duties under this Agreementissued and outstanding subordinated indebtedness; or
(xii) the Sponsor shall fail to own, directly or indirectly (through its subsidiaries) ownership of 100% of the outstanding common stock of the Servicer.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall have occurred and not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit DateIndenture Trustee, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Responsible Officer of the Servicer and to the Master Servicer shall direct Note Purchaser, and the Indenture Trustee to shall, but only at the direction of the Note Purchaser or the Majority Noteholders, terminate all of the rights and obligations of the Servicer under this Agreement Agreement, except for the Servicer's indemnification obligation under Section 7.19, and the Successor Indenture Trustee, in its capacity as successor servicer, or a successor Servicer appointed in accordance with Section 8.02 9.02, shall immediately make such Monthly Periodic Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest and assume, pursuant to Section 8.029.02 hereof, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the successor Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 9.02, pass to and be vested in the Successor Servicer pursuant to Indenture Trustee, or its designee approved by the Note Purchaser, and under this Section 8.01; and, without limitation, the Successor Servicer Indenture Trustee is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the Servicer's responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer Indenture Trustee, in its capacity as successor servicer, or its designee, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with The Indenture Trustee shall promptly notify the termination Note Purchaser of the occurrence of a Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days Event of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationDefault.
(c) Upon the occurrence of an (i) Event of Default under any of the Basic Documents, (ii) a Servicer Event of Default, the Servicer shall act as Servicer Default under this Agreement, subject (iii) a material adverse change in the business or financial conditions of the Servicer (each, a "Term Event"), the Servicer's right to service the Mortgage Loans pursuant to the right terms of removal set forth this Agreement shall remain in subsection (b) hereof, effect for an initial period commencing on the date on which such Servicer Term Event of Default occurred and ending shall automatically terminate at 5:00 p.m., New York, New York time, on the last Business Day of the calendar month in which such Term Event occurred (the "Initial Term"). Thereafter, the Initial Term shall be extendible in the sole discretion of the Note Purchaser by written notice (each, a "Servicer Extension Notice") of the Noteholder for successive one-month terms (each such term ending at 5:00 p.m., New York, New York time ("EST"), on the last business day of the calendar quarter in which such related month). Following a Term Event, the Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which hereby agrees that the Servicer shall be designated bound for the duration of the Initial Term and the term covered by any such Servicer Extension Notice to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause this Agreement and the Servicing Agreement. Following a Term Event, the Servicer agrees that if, as of 3:00 p.m. (bEST) above. In on the event the Master Servicer fails to deliver an Extension Notice prior to the end last business day of any Servicer Term of Servicemonth, the Servicer shall be automatically terminated.
(d) If not have received a Servicer Extension Notice from the Successor Note Purchaser, the Servicer or another Person succeeds shall give written notice of such non-receipt to the obligations of Servicer hereunderNote Purchaser by 4:00 p.m. (EST). Following a Term Event, the term failure of the Successor Servicer or such Person shall not be limited unless and until Note Purchaser to deliver a Servicer Event Extension Notice by 5:00 p.m. (EST) shall result in the automatic and immediate termination of Default thereafter occurs with respect to such Successor the Servicer or other Person(the "Termination Date"). At such timeNotwithstanding these time frames, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated Note Purchaser shall comply with all applicable laws in connection with such transfer and the Servicer shall continue to succeed service the Mortgage Loans until completion of such then-acting Servicertransfer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (American Business Financial Services Inc /De/)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2016-B Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuing:
not apply to the 2016-B Exchange Note or to this 2016-B Servicing Supplement: (i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2016-B Exchange Note under the Basic Servicing Agreement or this 2016-B Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure; (ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2016-B Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2016-B Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee; (iii) any representation, warranty or statement of the Servicer made in the 2016-B Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2016-B Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2016-B Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or (iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2016-B Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2016-B Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make 120 days will not constitute an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Exchange Note Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice if that failure or discovery delay was caused by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this AgreementForce Majeure. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of any such event, the Servicer will not be relieved from using all commercially reasonable efforts to perform its obligations in a timely manner in accordance with the terms of the Basic Servicing Agreement and this 2016-B Servicing Supplement. 17 (b) With respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject any actions to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended taken by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer 2016-B Exchange Noteholder thereunder shall be designated to act as Servicer hereunderexercised by the Indenture Trustee, a “Servicer Term acting at the direction of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from 66 2/3% of the Holders of Certificates evidencing at least 51% the Outstanding Amount of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminatedControlling Class.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Servicing Supplement
Servicer Events of Default. (a) If any one Any of the following events (“acts or occurrences shall constitute a Servicer Events Event of Default”) shall occur and be continuing:
(i) Any failure by the Servicer to deliver to the Indenture Trustee for payment to Noteholders any collections on Receivables or any other proceeds or payments in respect of the Trust Estate and required to be so delivered under the terms of the Indenture and this Agreement that continues unremedied until 10:00 a.m. (ACentral time) The on the Business Day following the date such remittance is required; provided that the Indenture Trustee, upon receiving actual knowledge of such failure, shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Indenture Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(ii) Any failure by the Servicer to deliver a Monthly Servicer's Report pursuant to Section 4.01 hereof that continues unremedied until 10:00 a.m. (Central time) the following Business Day; provided that if the Servicer has not delivered the Monthly Servicer's Report by 12:00 noon (Central time) on the Determination Date, the Indenture Trustee shall give the Servicer notice of such failure. Notwithstanding the foregoing, any failure by the Indenture Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(iii) Any failure by the Servicer to make a Servicer Advance when required pursuant to Section 3.04 hereof or to deposit in the Collection Account when required any Purchase Price received by it that continues unremedied until 10:00 a.m. (Central time) the following Business Day; provided that if the Servicer has not made such Servicer Advance or deposited such Purchase Price in the Collection Account received by it by 12:00 noon (Central time) on related Determination Date and the Indenture Trustee has received written notification from the Servicer by way of the Monthly Servicer's Report or otherwise that such Servicer Advance or Purchase Price is to be paid, the Indenture Trustee shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Indenture Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(iv) Any failure on the part of the Servicer in its capacity as such duly to observe or perform in any material respect any other covenants or agreements of the Servicer set forth in this Agreement or the Indenture, as the case may be, or if any representation or warranty of the Servicer set forth in Section 2.01 of this Agreement and in the other Transaction Documents to which the Servicer is a party shall prove to be incorrect, which failure or breach (A) in the case of any such representation or warranty, materially and adversely affects the interest or rights of the Note Insurer, the Indenture Trustee, or the Noteholders and (B) continues unremedied for a period of one 30 days after the earlier of (1x) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which the Servicer becomes aware of such failure or breach and (y) written notice of such failurefailure or breach, requiring the same situation giving rise to such breach or non-conformity to be remedied, shall have been given to a Servicing Officer of the Servicer by the Master ServicerIndenture Trustee, the Securities Administrator Controlling Party, the Issuer or the Trustee or to Back-up Servicer; or
(v) Any assignment by the Servicer and to a delegate of its duties or rights under the Master ServicerIndenture or this Agreement, the Securities Administrator except as specifically permitted thereunder or the Trusteehereunder, by or any Holder with Certificates evidencing Voting Rights of at least 25%attempt to make such an assignment; provided, however, that in the case or
(vi) The entry of a failure that cannot be cured within sixty (60) days, the cure period may be extended if decree or order for relief by a court having jurisdiction in respect of the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of or a petition against the Servicer in an involuntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy insolvency or similar law, or appointing a court conservator, receiver, liquidator, assignee, trustee, custodian, sequestrator or agency or supervisory authority having jurisdiction in the premises other similar official for the appointment Servicer for any substantial part of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingsits property, or for ordering the winding up or liquidation of its affairs, the affairs of the Servicer and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) 60 consecutive days; or
(ivvii) The commencement by the Servicer shall voluntarily go into liquidationof a voluntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy, insolvency, reorganization or similar law, or the consent by the Servicer to the appointment of or taking possession by a conservator conservator, receiver, liquidator, assignee, trustee, custodian, sequestrator or receiver or liquidator or other similar person official in any insolvency, readjustment of debt, marshaling of assets and liabilities liabilities, bankruptcy or similar proceedings of or relating to the Servicer or of or relating to all or substantially all a substantial part of its property, or a decree or order the making by the Servicer of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up failure by the Servicer generally to pay its debts as such debts become due or liquidation of its affairs, shall have been entered against the Servicer; or if the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or belowforegoing; or
(viii) the failure by occurrence of an event of default under the Servicer to complyCredit Agreement that is not cured, remedied or waived in writing, in accordance with the terms of the Credit Agreement, within 30 days of the required time periods, with Section 3.09 or the certification described under Section 3.10;date of initial occurrence of such event of default; or
(ix) the failure by ratio of consolidated indebtedness to consolidated Tangible Net Worth of the Servicer Reported Companies is greater than 6.5 to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer1.0; or
(x) the identification under any filing pursuant to Section 404 allowance for bad debt of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act Reported Companies is less than 7.0% of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation gross lease installments; or
(xi) for any fiscal quarter, the fixed charge ratio of internal controls which materially and adversely affect the Servicer’s ability Reported Companies is less than 1.25 to perform any 1.0; or
(xii) the occurrence of its duties under this Agreementa Trigger Event.
(b) then, and in each and every such case, so long as If a Servicer Event of Default shall not have been remediedoccurs, (x) with respect solely to clause (a)(i)(A) abovethe Indenture Trustee shall, (1) on at the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer direction of the Trustee or of the Securities Administrator of such failureControlling Party, the Master Servicer shall give telephonic by notice (by no later than 5:00 p.m. New York time on such Deposit Datethe "Servicer Termination Notice") of the failure then given in writing to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to Back-up Servicer, terminate all all, but not less than all, of the rights and obligations of the Servicer under this Agreement and Agreement.
(c) Upon the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written noticea Servicer Termination Notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates Notes or the Mortgage Loans Contracts or otherwise, shall pass to and be vested in the Successor successor Servicer appointed pursuant to and under this Section 8.01; 6.02 hereof, and, without limitation, the Successor such successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan the Contracts and related documents, or otherwise. The Servicer agrees to cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Back-up Servicer and the Trustee successor Servicer in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer Servicer, in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination any of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.the
Appears in 1 contract
Servicer Events of Default. (a) If any one of the The following events (“and conditions shall constitute Servicer Events of Default”) shall occur and be continuingDefault hereunder:
(i) (A) The failure by on the Servicer to make any Monthly Advance which continues unremedied for a period part of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in to the Collection Account Account, or other applicable account in accordance with the Distribution Account terms of the Indenture within three Business Days following the receipt thereof any deposit monies received by the Servicer (including, without limitation, any Lease Payments on Performing Leases or Non- Performing Leases) and required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was duedeposited thereunder and hereunder;
(ii) (A) The failure on the part of the Servicer to pay to the Trustee on the date when due in accordance with the terms hereof, any payment required to be made by the Servicer pursuant to make Section 5 hereof;
(iii) failure on the part of either the Servicer or (so long as the Originator is the Servicer) the Originator to observe or perform in any required material respect any other of their respective covenants or agreements in this Assignment and Servicing Advance Agreement which failure continues unremedied for a period of sixty 30 days after the earlier of (60A) daysthe date it first becomes known to any officer of the Originator or the Servicer, or as the case may be, and (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, thereof requiring the same to be remedied, remedied shall have been given to the Servicer Originator or the Servicer, as the case may be, by the Master ServicerTrustee, the Securities Administrator or the Trustee or to the Servicer Originator or the Servicer, as the case may be, and the Master ServicerTrustee by the Seller, the Securities Administrator Issuer, the Insurer or any holder of the Trustee, Notes;
(iv) if any representation or warranty made by the Originator in this Assignment and Servicing Agreement or in any certificate or other writing delivered pursuant hereto or made by any Holder successor Servicer in connection with Certificates evidencing Voting Rights such successor Servicer's assumption of at least 25%the duties of the Servicer shall prove to be incorrect in any material respect as of the time when the same shall have been made; provided, -------- however, that the breach of any representation or warranty made by the ------- Originator or Servicer in this Assignment and Servicing Agreement will be deemed to be "material" only if it affects the Noteholders, the Insurer or the enforceability of the Indenture or of the Notes; and provided, further, that a material breach of any representation or -------- ------- warranty made by the Originator in this Assignment and Servicing Agreement with respect to any of the Leases or the Equipment subject thereto will not constitute a Servicer Event of Default if the Originator purchases such Lease and the Issuer's interest in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Equipment in accordance with this Assignment and the Trustee that the Servicer is diligently pursuing remedial actionServicing Agreement;
(iiiv) The filing of a petition against the Servicer in entry by a court or agency or supervisory authority having jurisdiction in the premises of (A) a decree or order for relief in respect of the appointment Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) a decree or order adjudging the Servicer bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment, or composition of or in respect of the Servicer under any applicable federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of the Servicer or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of thirty (30) 60 consecutive days; or;
(ivvi) The the commencement by the Servicer shall voluntarily go into liquidationof a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order for relief in respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by it of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or failure by the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; orsuch action;
(vii) any reduction or withdrawal of the ratings failure of the Servicer as a servicer of subprime mortgage loans by to make one or more payments due with respect to aggregate recourse debt or other obligations exceeding $5,000,000, or the occurrence of any event or the existence of any condition, the effect of which event or condition is to cause (or permit one or more Persons to cause) more than $5,000,000 of aggregate recourse debt or other obligations of the Rating Agencies that maintains a servicer rating system Servicer to become due before its (or their) stated maturity or before its (or their) regularly scheduled dates of payment so long as such failure, event or condition shall be continuing and a rating on shall not have been waived by the Certificates Person or Persons entitled to “below average” or below; orperformance;
(viii) a final judgment or judgments (or decrees or orders) for the failure by the Servicer to comply, within the required time periods, with Section 3.09 payment of money aggregating in excess of $5,000,000 and any one of such judgments (or the certification described under Section 3.10decrees or orders) has remained unsatisfied and in effect for any period of 60 consecutive days without a stay of execution;
(ix) so long as IOS Capital is the failure by the Servicer to provideServicer, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 downgrading of the Slong-term debt rating assigned by ▇▇▇▇▇▇▇-▇▇▇▇'▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability or S&P to perform any of its duties under this Agreement.IOS Capital to Ba2 or below or BB or below, respectively;
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) abovefor any three consecutive Due Periods, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer average of the Trustee or Annualized Default Rates for such Due Periods shall be greater than 8.00%; or
(xi) for any three consecutive Due Periods, the average of the Securities Administrator of Delinquency Rates for such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 Due Periods shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationgreater than 10.00%.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Assignment and Servicing Agreement (Ikon Receivables LLC)
Servicer Events of Default. (a) If any one of the The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer and the Note Insurer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders of Notes evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(iii) any failure on the part of the Servicer duly to observe or perform in any material respect any other of the covenants or agreements on the part of the 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 Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(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 Servicer and such decree or order shall have remained in force, undischarged or unstayed for a period of ninety (90) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer; or's property;
(vi) the 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 12.50% of the sum of aggregate outstanding Principal Balance for the Mortgage Loans and any amount on deposit in the Pre-Funding Account;
(ix) if on any Payment Date, commencing in June 2001, the Twelve Month Loss Amount exceeds 2.50% of the sum of aggregate outstanding Principal Balance for the Mortgage Loans and any amount on deposit in the Pre-Funding Account, as of the close of business on the first day of the twelfth preceding calendar month;
(x) if on any Payment Date, the identification occurrence of a Company Stockholders' Equity Trigger; and
(xi) the occurrence of an Event of Default under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementIndenture.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Periodic Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Payment Date, the Indenture Trustee, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and to the Master Servicer shall direct Note Insurer and the Indenture Trustee to shall, with the consent of the Note Insurer, terminate all of the rights and obligations of the Servicer under this Agreement Agreement, except for the Servicer's indemnification obligation under Section 5.19, and the Successor Indenture Trustee, or a successor Servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Periodic Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor Servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (vii) of Section 7.01, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all Note Insurer or the Majority Noteholders, by notice in writing to the Servicer and a Responsible Officer of the Voting Rights) Indenture Trustee and subject to the prior written consent of the Note Insurer, in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, any removal at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given Majority Noteholders, and in writing addition to the Sellerwhatever rights such Noteholders may have at law or equity to damages, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this Agreement, except for the Servicer's indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as servicer; and (z) with respect to clauses (viii)-(x) of Section 7.01(a), the Indenture Trustee shall, but only at the direction of the Note Insurer, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement, except for the Servicer's indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to Indenture Trustee, or its designee approved by the Note Insurer, and under this Section 8.01; and, without limitation, the Successor Servicer Indenture Trustee is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the Servicer's responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer Indenture Trustee, or its designee, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Note Insurer and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Prudential Securities Secured Financing Corp)
Servicer Events of Default. (a) If any one Any of the following events (“acts or occurrences shall constitute a Servicer Events Event of Default”) shall occur and be continuing:
(i) Any failure by the Servicer to deliver to the Trustee for payment to the Certificateholders any proceeds or payments received from a Customer or in respect of the Trust Property and when required to be so delivered under the terms of the Trust and Security Agreement and this Agreement that continues unremedied until 10:00 a.m., Minneapolis time, on the second successive Business Day, provided, however, that the Trustee, upon receiving actual knowledge of such failure, shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(Aii) The Any failure by the Servicer to deliver a Monthly Servicer's Report pursuant to Section 4.01 hereof that continues unremedied until 10:00 a.m., Minneapolis
(iii) Any failure by the Servicer to make a Servicer Advance pursuant to Section 3.04 hereof or to deposit any Purchase Price received by it that continues unremedied until 10:00 a.m., Minneapolis time, the following Business Day; provided, however, that if the Servicer has not made the Servicer Advance or deposited any Purchase Price received by it by 12:00 noon, Minneapolis time, on the Determination Date and the Trustee has received written notification from the Servicer by way of the Monthly Servicer's Report or otherwise that such Servicer Advance or Purchase Price is to be paid, the Trustee shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(iv) Any failure by the Servicer to make remittances or deliver notices pursuant to Section 3.03 hereof, that continues unremedied until 10:00 a.m., Minneapolis time, of the third successive Business Day; or
(v) Any failure on the part of the Servicer duly to observe or perform in any material respect any other covenants or agreements of the Servicer, set forth in this Agreement or the Trust and Security Agreement, as the case may be, or any representation or warranty of the Servicer set forth in Section 2.01 of this Agreement shall prove to be incorrect, which failure or breach (A) materially and adversely affects the interest or rights of the Bond Insurer, the Trustee, the Back up Servicer or the Certificateholders and (B) continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 30 days after the date on which the Servicer becomes aware of such failure or breach or written notice of such failurefailure or breach, requiring the same situation giving rise to such breach or non-conformity to be remedied, shall have been given to a Servicing Officer of the Servicer by the Master Trustee, the Bond Insurer, the Transferor, or the Back-up Servicer, or to a Servicing Officer of the Servicer, the Securities Administrator or the Trustee or to the Servicer and the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Bond Insurer and the Trustee that by the Certificateholders; or
(vi) Any assignment by the Servicer is diligently pursuing remedial action;to a delegate of its duties or rights under this Agreement, except as specifically permitted hereunder, or any attempt to make such an assignment; or
(iiivii) The filing entry of a decree or order for relief by a court having jurisdiction in respect of the Servicer or a petition against the Servicer in a court an involuntary case under any federal bankruptcy laws, as now or agency hereafter in effect, or supervisory authority having jurisdiction in the premises for any other present or future federal or state bankruptcy, insolvency or similar law, or the appointment of a receiver, liquidator, assignee, trustee, conservatorcustodian, receiver sequestrator or liquidator in other similar official for the Servicer or for any insolvency, conservatorship, receivership, readjustment substantial part of debt, marshaling of assets and liabilities or similar proceedingsits property, or for the ordering of the winding up or liquidation of its affairs, the affairs of the Servicer and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) 60 consecutive days; or
(ivviii) The commencement by the Servicer shall voluntarily go into liquidationof a voluntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy, insolvency, reorganization or similar law, or the consent by the Servicer to the appointment of or taking possession by a conservator conservator, receiver, liquidator, assignee, trustee, custodian, sequestrator or receiver or liquidator or other similar person official in any insolvency, readjustment of debt, marshaling marshalling of assets and liabilities liabilities, bankruptcy or similar proceedings of or relating to the Servicer or of or relating to all or substantially all a substantial part of its property, or a decree or order the making by the Servicer of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up failure by the Servicer generally to pay its debts as such debts become due or liquidation of its affairs, shall have been entered against the Servicer; or if the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for of the benefit of its creditors or voluntarily suspend payment of its obligationsforegoing; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) The occurrence of a Trigger Event if the failure by the initial Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with is the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall not have been remediedremedied within the period set forth in (i), (xii), (iii), (iv), (v) with respect solely to clause or (a)(i)(Avii) above, (1) on as applicable, the related Deposit DateTrustee, upon receipt of written notice or discovery by at the Master Servicer or a Responsible Officer direction of the Trustee Bond Insurer shall, or if there has been a Bond Insurer Default, the Trustee, the Transferor, or the Back-up Servicer may, by notice (the "Servicer Termination Notice") then given in writing to the Servicer and the Back-up Servicer, terminate all, but not less than all, of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer rights and obligations of the Servicer andunder this Agreement. Notwithstanding the foregoing, a delay in or failure of performance under Section 6.01(a)(v) hereof for a period of 30 or more days shall not constitute a Servicer Event of Default if such delay or failure could not have been prevented by the exercise of reasonable diligence by the Servicer and such delay or failure was caused by acts of declared or undeclared war, public disorder, rebellion or sabotage, epidemics, landslides, lightning, fire, hurricanes, earthquakes, floods or similar causes. The preceding sentence shall not relieve the Servicer from using its best efforts to perform its obligations in a timely manner in accordance with the extent terms of this Agreement, and the applicable current contact information has been provided to Servicer shall provide the Master Trustee, the Back-up Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly AdvanceBond Insurer, the Master Servicer shall promptly give telephonic Transferor and the Certificateholders with prompt notice of such failure or delay by it, together with a description of its efforts to so perform its obligations.
(c) In the event of the occurrence of a Servicing Officer Trigger Event, the Trustee shall, at the direction of the Bond Insurer, or if there has been a Bond Insurer Default, the Trustee, the Transferor, or the Back-up Servicer may, by Servicer Termination Notice then given in writing to the Servicer and the Master Servicer shall direct the Trustee to Back-up Servicer, terminate all but not less than all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and Agreement.
(yd) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after the receipt by the Servicer of such written noticea Servicer Termination Notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans Lease Contracts or otherwise, shall pass to and be vested in the Successor successor Servicer appointed pursuant to and under this Section 8.01; 6.02 hereof, and, without limitationtermination, the Successor such successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan the Lease Contracts and related documents, or otherwise. The Servicer agrees to cooperate with the Successor ServicerTrustee, the Master Servicer, the Securities Administrator Back-up Servicer and the Trustee successor Servicer in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer Servicer, in the Collection Account or thereafter received by the predecessor Servicer with respect to Lease Contracts. To assist the Mortgage Loans. All Servicing Transfer Costs successor Servicer in enforcing all rights under the Lease Contracts and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files Insurance Polices to the Successor extent they relate to the Lease Contracts, the outgoing Servicer, at its own expense, shall transfer its records (electronic and otherwise) relating to such Lease Contracts to the successor Servicer in such form as the successor Servicer may reasonably request and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by transfer the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, related Lease Contracts (to the extent not paid held by the predecessor ServicerTrustee) and all other records, by correspondence and documents relating to the Trust prior Lease Contracts that it may possess to distributions to Certificateholders (or, if the predecessor successor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence manner and at such amounts are paid by times as the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the successor Servicer shall continue reasonably request. In addition to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer any other amounts that are then payable to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated entitled to act as receive reimbursements for any unreimbursed Servicer hereunder, a “Servicer Term of Service”) until such time as Advance made during the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice period prior to the end delivery of any a Servicer Term Termination Notice pursuant to this Section 6.01 which terminates the obligations and right of Service, the Servicer shall be automatically terminatedunder this Agreement.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 201[__]-[__] Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 201[__]-[__] Exchange Note or to this 201[__]-[__] Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 201[__]-[__] Exchange Note under the Basic Servicing Agreement or this 201[__]-[__] Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 201[__]-[__] Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 201[__]-[__] Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 201[__]-[__] Servicing Agreement or any certificate, report or other writing delivered pursuant to the 201[__]-[__] Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 201[__]-[__] Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of certain Insolvency Events with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 201[__]-[__] Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 201[__]-[__] Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement201[__]-[__] Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 201[__]-[__] Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 201[__]-[__] Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement201[__]-[__] Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf terms of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwiseBasic Servicing Agreement. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 201[__]-[__] Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 201[__]-[__] Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans201[__]-[__] Leases and 201[__]-[__] Vehicles and all information or documents that the Indenture Trustee or such Successor Servicer may require. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of In addition, the Servicer shall transfer its electronic records relating to the 201[__]-[__] Leases and transferring the Mortgage Files 201[__]-[__] Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(ce) Upon Notwithstanding Section 7.01(d), if the occurrence of Indenture Trustee shall be unwilling so to act or if it is legally unable so to act, a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Successor Servicer shall be designated appointed in accordance with Section 8.04 of the Basic Servicing Agreement. Compensation for any Successor Servicer shall not be greater than that payable to act MBFS USA as initial Servicer hereunder, a “Servicer Term hereunder without the prior consent of Service”) until such time as the Master Servicer, Majority Noteholders of the Securities Administrator and the Trustee receives written direction from the Controlling Class (or Holders of Certificates evidencing at least representing not less than 51% of the Voting Rights not to deliver an Extension Noticeaggregate Certificate Percentage Interests then outstanding if the Notes are no longer Outstanding). The Indenture Trustee and such successor shall take such action, in which event the Master Servicer shall follow such direction; provided that nothing in consistent with this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service201[__]-[__] Servicing Supplement, the Servicer as shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds necessary to the obligations of Servicer hereunder, the term of the Successor Servicer or effectuate any such Person succession. The Indenture Trustee shall not be limited unless and relieved of its duties as Successor Servicer under this Section until a newly appointed Servicer Event shall have assumed the obligations and duties of Default thereafter occurs with respect the terminated Servicer under this 201[__]-[__] Servicing Supplement. Notwithstanding anything to such the contrary contained herein, in no event shall the Indenture Trustee be liable for any servicing fee or for any differential in the amount of the servicing fee paid hereunder and the amount necessary to induce any Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting act as Successor Servicer and the Person then-obligated to succeed such then-acting Servicerhereunder.
Appears in 1 contract
Sources: Servicing Supplement (Daimler Trust)
Servicer Events of Default. Each of the following shall constitute a “Servicer Event of Default” on the part of the Servicer:
(a) If any one of the following events (“Servicer Events of Default”) shall occur and be continuing:
(i) (A) The Any failure by the Servicer to make observe or perform in any Monthly Advance which continues unremedied for a period material respect any of one (1) Business Day after it was due; the terms, covenants or (B) any other failure by agreements on the part of the Servicer to deposit set forth in the Collection Account this Purchase Agreement, any Transfer Supplement or the Distribution Account any deposit required to be made under the terms of this Custodial Agreement which continues unremedied for a period of two (2other than those set forth in clause (g) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(ibelow) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) daysdays after the date on which the Servicer has actual knowledge or written notice of such failure;
(b) Any representation, warranty, statement or certification made by the Servicer shall prove to have been incorrect in any material respect as of the time when made, and which continues to be incorrect in any material respect for sixty (B60) days after the date on which the Servicer has actual knowledge or written notice;
(c) Any failure by the Servicer duly to observe or perform, maintain any required licenses to do business in any jurisdiction where the Mortgaged Property is located, which failure has a material respect, any other covenants, obligations or agreements adverse effect on the ability of the Servicer as set forth in to perform its functions under this Agreement, which failure Purchase Agreement or materially and adversely affects impairs the interests value of the CertificateholdersMortgage Loans, and which continues to be unremedied for a period of sixty (60) days, days after the date on which the Servicer has actual knowledge or written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Trustee or to the Servicer and the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iiid) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises Application for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its propertyincluding bankruptcy, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling marshalling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; Servicer and a decree or the order shall have remained in force undischarged or unstayed for a period of sixty (60) days;
(e) The Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcyinsolvency, insolvency bankruptcy or reorganization statute, make an assignment for the benefit of its creditors or creditors, voluntarily suspend payment of its obligations; orobligations or cease its normal business operations other than in the ordinary course;
(vf) The Company or any Affiliate thereof enters into a consent agreement or otherwise agrees in writing with any federal or state regulatory agency or authority to restrict its activities, if the Servicer Termination Test is failed; ordefault of such agreement by the Company or any Affiliate thereof entitles such applicable federal or state agency to place the Company in receivership or conservatorship;
(ag) any reduction or withdrawal of The failure on the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings part of the Servicer as a servicer of subprime mortgage loans to make (x) any Monthly Advance required by one it under this Purchase Agreement on or more of before the Rating Agencies that maintains a servicer rating system date such advance is required to be made or (y) any other payment or deposit required by it under this Purchase Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which such failure continues unremedied for a period of fifteen days three (3) Business Days after the date on which the Servicer has actual knowledge or written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or;
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1h) on the related Deposit Date, upon receipt last Business Day of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failureany month, the Master Servicer shall give telephonic notice aggregate of all Delinquent Loans is more than five percent (by no later than 5:00 p.m. New York time on such Deposit Date5%) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% aggregate of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt non-prime home mortgage loans serviced by the Servicer of on such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and date which would be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, “Delinquent Loans” as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the defined herein were they Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.;
Appears in 1 contract
Sources: Mortgage Loan Purchase and Servicing Agreement (New Century Financial Corp)
Servicer Events of Default. (a) If any one of the The following events (shall each constitute a “Servicer Events Event of Default”) shall occur and be continuing” hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below and Delinquency Advances, which shall have no cure period), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and Indenture Trustee by the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates Noteholders affected thereby evidencing Voting Rights Percentage Interests of at least 25%; provided, however, provided however that any failed remittance cured within one Business Day of such failure shall include interest accrued at the Prime Rate (as set forth in the case Wall Street Journal) on the amount of a failure that cannot such remittance from and including the date the remittance was required to be cured within sixty (60) days, made to and including the cure period may be extended if date the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial actionremittance was actually made;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Servicer; orIndenture Trustee or to the Servicer and the Indenture Trustee by the Noteholders affected thereby evidencing Percentage Interests of at least 25%;
(xiii) any failure on the identification under part of the Servicer duly to observe or perform in any filing material respect any other covenants or agreements on the part of the Servicer contained in this Agreement, or the failure of any representation and warranty made pursuant to Section 404 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) days after the S▇▇▇▇▇▇▇date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by the 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-▇▇▇▇▇ Act up or liquidation of 2002 which identifies material weaknesses its affairs, shall have been entered against the Servicer and such decree or order shall have remained in connection with force, undischarged or unstayed for a period of ninety (90) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer’s ongoing evaluation property;
(vi) the Servicer shall admit in writing its inability generally to pay its debts as they become due, file a petition to take advantage of internal controls which materially and adversely affect any applicable insolvency or reorganization statute, make an assignment for the Servicer’s ability to perform any benefit of its duties under this Agreement.creditors, or voluntarily suspend payment of its obligations;
(bvii) thenif on any Payment Date the Rolling Six Month Delinquency Ratio exceeds 23.80%;
(viii) if on any Payment Date, the Cumulative Realized Loss Percentage exceeds the following percentages on any Payment Date during the following periods: Payment Date Occurring During Percentage July 2009 to June 2010 6.50 % July 2010 to June 2011 7.00 % July 2011 to June 2012 7.50 % July 2012 and in each and every such case, so thereafter 8.00 %
(ix) the occurrence of an Event of Default under the Indenture. So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Delinquency Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Payment Date, the Indenture Trustee, upon receipt of written notice or discovery actual knowledge by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct Indenture Trustee may, and upon request of the Trustee to Holders representing more than 50% of the Class Note Balance, shall, terminate all of the rights and obligations of the Servicer under this Agreement Agreement, except for the Servicer’s indemnification obligation under Section 5.19, and the Successor Servicer Indenture Trustee (if it is the successor servicer) or a successor servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Delinquency Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest as provided in Section 7.02 and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (xii) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) aboveMajority Noteholders, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the SellerServicer and a Responsible Officer of the Indenture Trustee, the Servicerand in addition to whatever rights such Noteholders may have at law or equity to damages, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer; and (z) with respect to clauses (vii)-(ix) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee shall, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to another successor servicer, and under this Section 8.01; and, without limitation, the Successor Servicer another successor servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and to pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee or another 57 successor servicer in effecting the termination of the Servicer’s responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer another successor servicer, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Rating Agencies and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Swap Provider of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of DefaultDefault upon discovery or receipt of notice by a Responsible Officer of the Indenture Trustee; provided, however, the Servicer Indenture Trustee shall act as Servicer under this Agreement, subject not be obligated to monitor the right Servicer’s compliance with the terms hereof or to determine the occurrence of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such any Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminatedDefault.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement
Servicer Events of Default. (a) If any one of the The following events (and conditions shall constitute “Servicer Events of Default”) shall occur and be continuing” upon their occurrence at any time on or after the initial Transfer Date:
(i) (A) The failure by on the part of the Servicer to make remit to the Indenture Trustee any Monthly Advance which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit amount required to be made remitted under the terms of this Agreement which continues unremedied for a within the time period of two (2) Business Days after such deposit was due or (C) required under this Agreement; provided, however that the failure by of the Indenture Trustee to accept any remittance from the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for shall not constitute a period Servicer Event of one (1) Business Day after it was dueDefault;
(ii) failure on the part of the Servicer to deliver to the appropriate party any financial statement or management report required to be delivered under this Agreement within fifteen (15) Business Days of when required to be delivered under this Agreement;
(iii) (A) The failure by on the part of the Servicer to make deliver a Servicer Report within five (5) Business Days of the date required pursuant to Section 3.05 hereof or (B) the Servicer delivers a Servicer Report which is materially incorrect and the Servicer fails to correct such inaccuracy for a period of five (5) Business Days after the earlier of (x) the Servicer becoming aware of such inaccuracy or (y) the giving of written notice of such inaccuracy (I) to the Servicer by the Indenture Trustee or (II) to the Servicer and the Indenture Trustee by a Global Requisite Majority of Noteholders;
(iv) failure on the part of the Servicer duly to observe or perform in any required Servicing Advance material respect any other of its respective covenants or agreements in this Agreement which failure continues unremedied for a period of sixty thirty (6030) days, or days after the earlier of (Bx) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements officer of the Servicer as set forth in this Agreement, which becoming aware of such failure materially and adversely affects or (y) the interests giving of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, requiring the same to be remedied, shall have been given failure (I) to the Servicer by the Master Servicer, the Securities Administrator or the Indenture Trustee or (II) to the Servicer and the Master Servicer, the Securities Administrator or the Trustee, Indenture Trustee by any Holder with Certificates evidencing Voting Rights a Global Requisite Majority of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial actionNoteholders;
(iiiv) The filing if any representation or warranty of a petition against the Servicer made in this Agreement or in any certificate or other writing delivered pursuant hereto or any other Related Documents is incorrect in any material respect as of the time when the same shall have been made;
(vi) the entry by a court or agency or supervisory authority having jurisdiction in the premises of (A) a decree or order for relief in respect of the appointment Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) a decree or order adjudging the Servicer bankrupt or insolvent, or approving as properly filed a petition seeking reorganization of the Servicer, or arrangement or adjustment of the Servicer’s assets, of or in respect of the Servicer under any applicable federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of the winding Servicer or of any substantial part of its property, or ordering the winding-up or liquidation of its affairsthe affairs of the Servicer, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of thirty ninety (3090) consecutive days; or;
(ivvii) The the commencement by the Servicer shall voluntarily go into liquidationof a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by the Servicer to the entry of a decree or order for relief in respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against the Servicer, or the filing by the Servicer of a petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by the Servicer to the filing of such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by the Servicer of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or failure by the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; orsuch action;
(viii) any assignment by the failure Servicer, or any attempt by the Servicer to complyassign its duties or rights hereunder, within the required time periods, with Section 3.09 or the certification described under Section 3.10except as specifically permitted hereunder;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 Tangible Net Worth of the S▇▇▇▇▇▇ Companies shall at any time be less than the sum of: (i) $75,000,000; plus (ii) if positive, 75% of the cumulative Net Income of the ▇▇-▇▇▇▇▇ Act Companies for each fiscal quarter earned from and after December 31, 2000 (without any deduction for net losses for any fiscal quarter); plus (iii) 75% of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation net proceeds received by Servicer from the issuance of internal controls which materially and adversely affect the Servicer’s ability to perform any common stock or preferred stock of its duties under Servicer after January 1, 2001; (for purposes of this Agreement.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicerix), the Rating Agencies and if given by Holders of Certificates, to following terms shall have the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.following meanings:
Appears in 1 contract
Servicer Events of Default. (a) If any one of the following events (“"Servicer Events of Default”") shall occur and be continuing:
(i) (A) The failure by the Servicer to make any Monthly Advance which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Payment Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Payment Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the CertificateholdersNoteholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, the Securities Administrator or the Indenture Trustee, by any Holder with Certificates evidencing Voting Rights the Holders of at least not less than 25%% of the aggregate Note Balance of the Notes; providedPROVIDED, howeverHOWEVER, that in the case of a failure that cannot be -------- ------- cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Administrator, the Indenture Trustee and the Trustee Seller that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates Notes attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates Notes on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates Notes to “"below average” " or below; or
(viii) the failure by the Servicer to complyduly perform, within the required time periodsperiod, with its obligation to provide the annual statement of compliance described under Section 3.09 3.09, the accountant's report described under Section 3.10 or the certification described under Section 3.103.13(e), which failure continues unremedied for a period of ten days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s 's ongoing evaluation of internal controls which materially and adversely affect the Servicer’s 's ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Indenture Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 6.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Payment Date and assume, pursuant to Section 8.026.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Indenture Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all the aggregate Note Balance of the Voting RightsNotes) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Indenture Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all the aggregate Note Balance of the Voting Rights Notes by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of CertificatesNotes, to the Indenture Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates Notes or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.016.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ ' fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 6.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions payments to Certificateholders Noteholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.035.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “"Extension Notice”") for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “"Servicer Term of Service”") until such time as the Master Servicer, the Securities Administrator and the Indenture Trustee receives written direction from the Holders of Certificates evidencing at least not less than 51% of the Voting Rights aggregate Note Balance of the Notes not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders Noteholders from directing the Indenture Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c6.01(c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Servicing Agreement (Renaissance Mortgage Acceptance Corp)
Servicer Events of Default. (a) If any one of the following events (“"Servicer Events of Default”") shall occur and be continuing:
(i) (A) The failure by the Servicer to make any Monthly Advance which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Payment Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Payment Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the CertificateholdersNoteholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, the Securities Administrator or the Indenture Trustee, by any Holder with Certificates evidencing Voting Rights the Holders of at least not less than 25%% of the aggregate Note Balance of the Notes; providedPROVIDED, howeverHOWEVER, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Administrator, the Indenture Trustee and the Trustee Seller that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates Notes attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates Notes on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates Notes to “"below average” " or below; or
(viii) the failure by the Servicer to complyduly perform, within the required time periodsperiod, with its obligation to provide the annual statement of compliance described under Section 3.09 3.09, the accountant's report described under Section 3.10 or the certification described under Section 3.103.13(e), which failure continues unremedied for a period of ten days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s 's ongoing evaluation of internal controls which materially and adversely affect the Servicer’s 's ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give immediate telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Indenture Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 6.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Payment Date and assume, pursuant to Section 8.026.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Indenture Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all the aggregate Note Balance of the Voting RightsNotes) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Indenture Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all the aggregate Note Balance of the Voting Rights Notes by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of CertificatesNotes, to the Indenture Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates Notes or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.016.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ ' fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 6.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions payments to Certificateholders Noteholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.035.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “"Extension Notice”") for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “"Servicer Term of Service”") until such time as the Master Servicer, the Securities Administrator and the Indenture Trustee receives written direction from the Holders of Certificates evidencing at least not less than 51% of the Voting Rights aggregate Note Balance of the Notes not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders Noteholders from directing the Indenture Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c6.01(c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Servicing Agreement (Renaissance Home Equity Loan Trust 2005-1)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 201[__]-[__] Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 201[__]-[__] Exchange Note or to this 201[__]-[__] Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 201[__]-[__] Exchange Note under the Basic Servicing Agreement or this 201[__]-[__] Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 201[__]-[__] Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 201[__]-[__] Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 201[__]-[__] Servicing Agreement or any certificate, report or other writing delivered pursuant to the 201[__]-[__] Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 201[__]-[__] Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of certain Insolvency Events with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 201[__]-[__] Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 201[__]-[__] Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement201[__]-[__] Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 201[__]-[__] Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 201[__]-[__] Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement201[__]-[__] Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf terms of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwiseBasic Servicing Agreement. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 201[__]-[__] Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 201[__]-[__] Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans201[__]-[__] Leases and 201[__]-[__] Vehicles and all information or documents that the Indenture Trustee or such Successor Servicer may require. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of In addition, the Servicer shall transfer its electronic records relating to the 201[__]-[__] Leases and transferring the Mortgage Files 201[__]-[__] Vehicles to the Successor Servicer in such electronic form as the Successor Servicer may reasonably request, and amending this Agreement the Successor Servicer shall not be liable if it cannot perform due to reflect such succession as the failure of the predecessor Servicer pursuant to this Section 8.01 so deliver. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(ce) Upon Notwithstanding Section 7.01(d), if the occurrence of Indenture Trustee shall be unwilling so to act or if it is legally unable so to act, a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Successor Servicer shall be designated appointed in accordance with Section 8.04 of the Basic Servicing Agreement. Compensation for any Successor Servicer shall not be greater than that payable to act MBFS USA as initial Servicer hereunder, a “Servicer Term hereunder without the prior consent of Service”) until such time as the Master Servicer, Majority Noteholders of the Securities Administrator and the Trustee receives written direction from the Controlling Class (or Holders of Certificates evidencing at least representing not less than 51% of the Voting Rights not to deliver an Extension Noticeaggregate Certificate Percentage Interests then outstanding if the Notes are no longer Outstanding). The Indenture Trustee and such successor shall take such action, in which event the Master Servicer shall follow such direction; provided that nothing in consistent with this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service201[__]-[__] Servicing Supplement, the Servicer as shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds necessary to the obligations of Servicer hereunder, the term of the Successor Servicer or effectuate any such Person succession. The Indenture Trustee shall not be limited unless and relieved of its duties as Successor Servicer under this Section until a newly appointed Servicer Event shall have assumed the obligations and duties of Default thereafter occurs with respect the terminated Servicer under this 201[__]-[__] Servicing Supplement. Notwithstanding anything to such the contrary contained herein, in no event shall the Indenture Trustee be liable for any servicing fee or for any differential in the amount of the servicing fee paid hereunder and the amount necessary to induce any Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting act as Successor Servicer and the Person then-obligated to succeed such then-acting Servicerhereunder.
Appears in 1 contract
Sources: Servicing Supplement (Daimler Trust)
Servicer Events of Default. (a) If any In case one or more of the following events (“Servicer Events of Default”) Default shall occur and be continuing, that is to say:
(i1) (A) The any failure by Servicer to deposit into the Collection Account or the Distribution Account or any failure by Servicer to make any Monthly Advance of the required payments therefrom; or
(2) any failure on the part of the Servicer duly to observe or perform in any material respect any other of the material covenants or agreements on the part of the Servicer, contained in any Basic Document to which it is a party, which continues unremedied for a period of one 30 days (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit or, in the Collection Account or the Distribution Account any deposit required to be made under the terms case of this Agreement which continues unremedied payment of insurance premiums, for a period of two (215 days) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Trustee any other party hereto or to the Servicer and (with copy to each other party hereto), by Holders of 25% of the Master Servicer, Percentage Interests of the Securities Administrator Notes or the TrusteeTrust Certificates; or
(3) any breach on the part of the Servicer of any representation or warranty contained in any Basic Document to which it is a party that materially and adversely affects the interests of any of the parties hereto or any Securityholder and which continues unremedied for a period of 30 days after the date on which notice of such breach, requiring the same to be remedied, shall have been given to the Servicer by any other party hereto or to the Servicer (with copy to each other party hereto), by any Holder with Certificates evidencing Voting Rights the Initial Noteholder or Holders of at least 25%; provided, however, that % of the Percentage Interests (as defined in the case of a failure that cannot be cured within sixty (60Indenture) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;Notes; or
(iii4) The filing of a petition against the Servicer in there shall have been commenced before a court or agency or supervisory authority having jurisdiction in the premises for an involuntary proceeding against the appointment of a trusteeServicer under any present or future federal or state bankruptcy, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities insolvency or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises law for the appointment of a conservator, receiver, liquidator liquidator, trustee or similar person official in any bankruptcy, insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, which action shall not have been entered against dismissed for a period of 60 days; or
(5) the ServicerServicer shall consent to the appointment of a conservator, receiver, liquidator, trustee or similar official in any bankruptcy, insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to it or of or relating to all or substantially all of its property; or or
(6) the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or creditors, voluntarily suspend payment of its obligations, or take any corporate action in furtherance of the foregoing; or
(v7) the Servicer Termination Test is failedReserved; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to 8) the Servicer or the servicing Loan Originator fails to comply with any of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loansits financial covenants set forth in Section 7.02; or
(vii9) any reduction or withdrawal a Change of Control of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x10) so long as the identification Servicer or the Loan Originator is an Affiliate of either of the Depositor or the Issuer and any "event of default' by any such party occurs under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementBasic Documents.
(b) thenThen, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Indenture Trustee or of the Securities Administrator of such failureMajority Noteholders, the Master Servicer shall give telephonic by notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure in writing to make a Monthly Advance to a Servicing Officer of the Servicer andmay, in addition to the extent the applicable current contact information has been provided whatever rights such Person may have at law or in equity to the Master Servicerdamages, the Servicing Rights Pledgee including injunctive relief and (2) on the Business Day immediately following the related Deposit Datespecific performance, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to may terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior and to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee Loans and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) aboveproceeds thereof, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 9.02 hereof, pass to and be vested in a successor servicer, and the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer successor servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each Mortgage Loan the Loans and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee successor servicer in effecting the termination of the Servicer's responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer successor servicer for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the each Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of (i) an Event of Default or Default under any of the Basic Documents, (ii) a Servicer Event of Default, the Servicer shall act as Servicer Default under this Agreement, subject (iii) a Rapid Amortization Trigger or (iv) a determination, reasonably made by the Initial Noteholder, that an event has occurred that shall materially impair the ability of the Servicer to service and administer the right of removal Loans in accordance with the terms and provisions set forth in subsection the Servicing Addendum (b) hereofeach, a "Term Event"), the Servicer's right to service the Loans pursuant to the terms of this Agreement shall be in effect for an initial period commencing on the date on which such Servicer Term Event of Default occurred and ending shall automatically terminate at 5:00 p.m. (New York City time), on the last business day of the calendar quarter month in which such Term Event occurred (the "Initial Term"). Thereafter, the Initial Term shall be extendible in the sole discretion of the Initial Noteholder by written notice (each, a "Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”") of the Initial Noteholder for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year successive one-month terms (each such quarterly period for which term ending at 5:00 p.m. (New York City time), on the last business day of the related month). Following a Term Event, the Servicer hereby agrees that the Servicer shall be designated bound for the duration of the Initial Term and the term covered by any such Servicer Extension Notice to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause this Agreement. Following a Term Event, the Servicer agrees that if, as of 3:00 p.m. (bNew York City time) above. In on the event the Master Servicer fails to deliver an Extension Notice prior to the end last business day of any Servicer Term of Servicemonth, the Servicer shall be automatically terminated.
(d) If not have received a Servicer Extension Notice from the Successor Initial Noteholder, the Servicer or another Person succeeds shall give written notice of such non-receipt to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.Initial Noteholder by
Appears in 1 contract
Servicer Events of Default. (a) If any one of the The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer and the Note Insurer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders of Notes evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(iii) any failure on the part of the Servicer duly to observe or perform in any material respect any other of the covenants or agreements on the part of the 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 Servicer by the Back-up Servicer or the Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(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 Servicer and such decree or order shall have remained in force, undischarged or unstayed for a period of sixty (60) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer's property;
(vi) the 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 Distribution Date the Rolling Six Month Delinquency Rate exceeds 12.75% of the aggregate outstanding Principal Balance for the Mortgage Loans;
(ix) if on any Distribution Date, commencing in June 2000, the Twelve Month Loss Amount exceeds 1.75% of the aggregate outstanding Principal Balance for the Mortgage Loans, as of the close of business on the first day of the twelfth preceding calendar month;
(x) if (a) on any Distribution Date occurring before June 1, 2000, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 1.00% of the Original Pool Principal Balance, (b) on any Distribution Date on or after June 1, 2000 and before June 1, 2001, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 1.50% of the Original Pool Principal Balance, (c) on any Distribution Date on or after June 1, 2001 and before June 1, 2002, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 2.25% of the Original Pool Principal Balance, (d) on any Distribution Date on or after June 1, 2002 and before June 1, 2003, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 3.00% of the Original Pool Principal Balance, or (e) on any Distribution Date on or after June 1, 2003, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 3.75% of the Original Pool Principal Balance;
(xi) the occurrence of an Event of Default under the Indenture; or
(xxii) the identification under any filing pursuant to a Servicer Extension Notice shall not have been delivered as set forth in Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement8.04 hereof.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Periodic Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Distribution Date, the Indenture Trustee, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and to the Master Note Insurer and the Back-up Servicer shall direct and the Indenture Trustee to shall, with the consent of the Note Insurer, terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Back-up Servicer, or a successor Servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Periodic Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor successor Servicer; provided, however, that the Back-up Servicer shall not be required to act as successor servicer until such time as the Back-up Servicer has agreed in writing with the Indenture Trustee and the Note Insurer to so act; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (vii) of Section 7.01, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all Note Insurer or the Majority Noteholders, by notice in writing to the Servicer and a Responsible Officer of the Voting Rights) Indenture Trustee and subject to the prior written consent of the Note Insurer, in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, any removal at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given Majority Noteholders, and in writing addition to the Sellerwhatever rights such Noteholders may have at law or equity to damages, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this AgreementAgreement and in and to the Mortgage Loans and the proceeds thereof, as servicer; and (z) with respect to clauses (viii)-(x) of Section 7.01(a), the Indenture Trustee shall, but only at the direction of the Note Insurer, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to Back-up Servicer, or its designee approved by the Note Insurer, and under this Section 8.01; and, without limitation, the Successor Back-up Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the Servicer's responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer Back-up Servicer, or its designee, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Note Insurer and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (American Business Financial Services Inc /De/)
Servicer Events of Default. (a) If any one of the The following events (“and conditions shall constitute Servicer Events of Default”) shall occur and be continuingDefault hereunder:
(i) (A) The failure by on the Servicer to make any Monthly Advance which continues unremedied for a period part of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in to the Collection Account Account, or other applicable account in accordance with the Distribution Account terms of the Indenture within three Business Days following the receipt thereof any deposit monies received by the Servicer (including, without limitation, any Lease Payments on Performing Leases or Non- Performing Leases) and required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was duedeposited thereunder and hereunder;
(ii) (A) The failure on the part of the Servicer to pay to the Trustee on the date when due in accordance with the terms hereof, any payment required to be made by the Servicer pursuant to make Section 5 hereof;
(iii) failure on the part of either the Servicer or (so long as the Originator is the Servicer) the Originator to observe or perform in any required material respect any other of their respective covenants or agreements in this Assignment and Servicing Advance Agreement which failure continues unremedied for a period of sixty 30 days after the earlier of (60A) daysthe date it first becomes known to any officer of the Originator or the Servicer, or as the case may be, and (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, thereof requiring the same to be remedied, remedied shall have been given to the Servicer Originator or the Servicer, as the case may be, by the Master ServicerTrustee, the Securities Administrator or the Trustee or to the Servicer Originator or the Servicer, as the case may be, and the Master ServicerTrustee by the Seller, the Securities Administrator Issuer, the Insurer or any holder of the Trustee, Notes;
(iv) if any representation or warranty made by the Originator in this Assignment and Servicing Agreement or in any certificate or other writing delivered pursuant hereto or made by any Holder successor Servicer in connection with Certificates evidencing Voting Rights such successor Servicer's assumption of at least 25%the duties of the Servicer shall prove to be incorrect in any material respect as of the time when the same shall have been made; provided, however, that the breach of any representation or -------- ------- warranty made by the Originator or Servicer in this Assignment and Servicing Agreement will be deemed to be "material" only if it affects the Noteholders, the Insurer or the enforceability of the Indenture or of the Notes; and provided, further, that a material breach of any -------- ------- representation or warranty made by the Originator in this Assignment and Servicing Agreement with respect to any of the Leases or the Equipment subject thereto will not constitute a Servicer Event of Default if the Originator purchases such Lease and the Issuer's interest in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Equipment in accordance with this Assignment and the Trustee that the Servicer is diligently pursuing remedial actionServicing Agreement;
(iiiv) The filing an involuntary petition or proceeding shall be filed (A) in respect of a petition against the Servicer under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) seeking a decree or order adjudging the Servicer bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, or composition of or in a court respect of the Servicer under any applicable federal or agency state law, or supervisory authority having jurisdiction in the premises for the appointment of a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of the Servicer or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and either (1) such petition shall not have been dismissed within a period of 60 consecutive days or (2) any such order for relief or decree shall be entered in any such proceeding, or any such receiver, liquidator, assignee, trustee, sequestrator or other similar official shall be appointed;
(vi) the continuance commencement by the Servicer of a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any such other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order unstayed and for relief in effect for respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a period petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by it to the filing of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by it of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or failure by the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; orsuch action;
(vii) any reduction or withdrawal of the ratings failure of the Servicer as a servicer of subprime mortgage loans by to make one or more payments due with respect to aggregate recourse debt or other obligations exceeding $5,000,000, or the occurrence of any event or the existence of any condition, the effect of which event or condition is to cause (or permit one or more Persons to cause) more than $5,000,000 of aggregate recourse debt or other obligations of the Rating Agencies that maintains a servicer rating system Servicer to become due before its (or their) stated maturity or before its (or their) regularly scheduled dates of payment so long as such failure, event or condition shall be continuing and a rating on shall not have been waived by the Certificates Person or Persons entitled to “below average” or below; orperformance;
(viii) a final judgment or judgments (or decrees or orders) for the failure by the Servicer to comply, within the required time periods, with Section 3.09 payment of money aggregating in excess of $5,000,000 and any one of such judgments (or the certification described under Section 3.10decrees or orders) has remained unsatisfied and in effect for any period of 60 consecutive days without a stay of execution;
(ix) so long as IOS Capital is the failure by the Servicer to provideServicer, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 downgrading of the Slong-term debt rating assigned by ▇▇▇▇▇▇▇-▇▇▇▇'▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability or S&P to perform any of its duties under this Agreement.IOS Capital to Ba2 or below or BB or below, respectively;
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) abovefor any three consecutive Due Periods, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer average of the Trustee or Annualized Default Rates for such Due Periods shall be greater than 8.00%; or
(xi) for any three consecutive Due Periods, the average of the Securities Administrator of Delinquency Rates for such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 Due Periods shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationgreater than 10.00%.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Assignment and Servicing Agreement (Ikon Receivables LLC)
Servicer Events of Default. (a) If any one of the The following events (“and conditions shall constitute Servicer Events of Default”) shall occur and be continuingDefault hereunder:
(i) (A) The failure by on the Servicer to make any Monthly Advance which continues unremedied for a period part of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in to the Collection Lockbox Account or other applicable account in accordance with the Distribution Account terms of the Indenture within two Business Days following the receipt thereof any deposit monies received by the Servicer and required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was duedeposited hereunder;
(ii) (A) The so long as the Servicer is the Servicer hereunder, failure by on the part of the Servicer to make pay to the Trustee on the date when due in accordance with the terms hereof, any payment required to be made by the Seller pursuant to Article 4 hereof;
(iii) failure on the part of the Servicer to observe or perform in any material respect any other of their respective covenants or agreements in this Servicing Advance Agreement which failure continues unremedied for a period of sixty 30 days after the earlier of (60A) daysthe date it first becomes known to any officer of the Seller or the Servicer, or as the case may be, and (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, thereof requiring the same to be remedied, remedied shall have been given to the Servicer by the Master Servicer, the Securities Administrator Trustee;
(iv) if any representation or the Trustee or to warranty made by the Servicer and in this Servicing Agreement or in any certificate or other writing delivered pursuant hereto shall prove to be incorrect in any material respect as of the Master Servicer, time when the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%same shall have been made; provided, however, that the breach of any representation or warranty made by the Servicer in this Servicing Agreement will be deemed to be "material" only if it affects the case of a failure that cannot be cured within sixty (60) daysNoteholders, the cure period may be extended enforceability of the Indenture or of the Notes; and provided, further, that a material breach of any representation or warranty made by the Servicer in this Servicing Agreement with respect to any of the Leases or the Equipment subject thereto will not constitute a Servicer Event of Default if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator repurchases such Lease and the Trustee that the Servicer is diligently pursuing remedial action;Equipment in accordance with this Servicing Agreement.
(iiiv) The filing of a petition against the Servicer in entry by a court or agency or supervisory authority having jurisdiction in the premises of (A) a decree or order for relief in respect of the appointment Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) a decree or order adjudging the Servicer bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment, or composition of or in respect of the Servicer under any applicable federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of the Servicer or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of thirty (30) 60 consecutive days; or;
(ivvi) The the commencement by the Servicer shall voluntarily go into liquidationof a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order for relief in respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by it of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or failure by the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loanssuch action; or
(vii) a final judgment or judgments (or decrees or orders) for the payment of money aggregating in excess of [$5,000,000] and any reduction one of such judgments (or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one decrees or more of the Rating Agencies that maintains a servicer rating system orders) has remained unsatisfied and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, in effect for any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen 60 consecutive days after the date on which written notice without a stay of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreementexecution.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Servicing Agreement (Charter Equipment Lease 1998-1 LLC)
Servicer Events of Default. (a) If any one of the The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer and the Note Insurer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders of Notes evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(iii) any failure on the part of the Servicer duly to observe or perform in any material respect any other of the covenants or agreements on the part of the 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 Servicer by the Back-up Servicer or the Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(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 Servicer and such decree or order shall have remained in force, undischarged or unstayed for a period of sixty (60) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer's property;
(vi) the 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 Distribution Date the Rolling Six Month Delinquency Rate exceeds 12.75% for Mortgage Loan Pool I and 12.75% for Mortgage Loan Pool II;
(ix) if on any Distribution Date, commencing in December 1999, the Twelve Month Loss Amount exceeds 1.75% of the aggregate outstanding Principal Balance for the Mortgage Loans in Pool I and 1.75% for the Mortgage Loans in Pool II, as of the close of business on the first day of the twelfth preceding calendar month;
(x) if (a) on any Distribution Date occurring before December 1, 1999, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 1.00% of the Original Pool Principal Balance, (b) on any Distribution Date on or after December 1, 1999 and before December 1, 2000, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 1.50% of the Original Pool Principal Balance, (c) on any Distribution Date on or after December 1, 2000 and before December 1, 2001, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 2.25% of the Original Pool Principal Balance, (d) on any Distribution Date on or after December 1, 2001 and before December 1, 2002, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 3.00% of the Original Pool Principal Balance, or (e) on any Distribution Date on or after December 1, 2002, the aggregate Cumulative Loan Losses since the Initial Cut-Off Date exceed 3.75% of the Original Pool Principal Balance;
(xi) the occurrence of an Event of Default under the Indenture; or
(xxii) the identification under any filing pursuant to a Servicer Extension Notice shall not have been delivered as set forth in Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement8.04 hereof.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Periodic Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Distribution Date, the Indenture Trustee, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and to the Master Servicer shall direct Note Insurer and the Indenture Trustee to shall, with the consent of the Note Insurer, terminate all of the rights and obligations of the Servicer under this Agreement Agreement, except for the Servicer's indemnification obligation under Section 5.19, and the Successor Back-up Servicer, or a successor Servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Periodic Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor successor Servicer; provided, however, that the Back-up Servicer shall not be required to act as successor servicer until such time as the Back-up Servicer has agreed in writing with the Indenture Trustee and the Note Insurer to so act; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (vii) of Section 7.01, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all Note Insurer or the Majority Noteholders, by notice in writing to the Servicer and the Back-up Servicer and a Responsible Officer of the Voting Rights) Indenture Trustee and subject to the prior written consent of the Note Insurer, in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, any removal at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given Majority Noteholders, and in writing addition to the Sellerwhatever rights such Noteholders may have at law or equity to damages, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this AgreementAgreement and in and to the Mortgage Loans and the proceeds thereof, as servicer; and (z) with respect to clauses (viii)-(x) of Section 7.01(a), the Indenture Trustee shall, but only at the direction of the Note Insurer, after notice in writing to the Servicer, the Back-up Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Back-up Servicer pursuant to or its designee approved by the Note Insurer, and under this Section 8.01; and, without limitation, the Successor Back-up Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the Servicer's responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer Back-up Servicer, or its designee, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Note Insurer and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (American Business Financial Services Inc /De/)
Servicer Events of Default. (a) If any one of the The following events (“and conditions shall constitute Servicer Events of Default”) shall occur and be continuingDefault hereunder:
(i) (A) The failure by on the Servicer to make any Monthly Advance which continues unremedied for a period part of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in to the Collection Account Account, or other applicable account in accordance with the Distribution Account terms of the Indenture within three Business Days following the receipt thereof any deposit monies received by the Servicer (including, without limitation, any Lease Payments on Performing Leases or Non-Performing Leases) and required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was duedeposited thereunder and hereunder;
(ii) (A) The failure on the part of the Servicer to pay to the Trustee on the date when due in accordance with the terms hereof, any payment required to be made by the Servicer pursuant to make Section 5 hereof;
(iii) failure on the part of either the Servicer or (so long as the Originator is the Servicer) the Originator to observe or perform in any required material respect any other of their respective covenants or agreements in this Assignment and Servicing Advance Agreement which failure continues unremedied for a period of sixty 30 days after the earlier of (60A) daysthe date it first becomes known to any officer of the Originator or the Servicer, or as the case may be, and (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on which written notice of such failure, thereof requiring the same to be remedied, remedied shall have been given to the Servicer Originator or the Servicer, as the case may be, by the Master ServicerTrustee, the Securities Administrator or the Trustee or to the Servicer Originator or the Servicer, as the case may be, and the Master ServicerTrustee by the Seller, the Securities Administrator Issuer, the Insurer or any holder of the Trustee, Notes;
(iv) if any representation or warranty made by the Originator in this Assignment and Servicing Agreement or in any certificate or other writing delivered pursuant hereto or made by any Holder successor Servicer in connection with Certificates evidencing Voting Rights such successor Servicer's assumption of at least 25%the duties of the Servicer shall prove to be incorrect in any material respect as of the time when the same shall have been made; provided, -------- however, that the breach of any representation or warranty made by the ------- Originator or Servicer in this Assignment and Servicing Agreement will be deemed to be "material" only if it affects the Noteholders, the Insurer or the enforceability of the Indenture or of the Notes; and provided, further, that a material breach of any representation or -------- ------- warranty made by the Originator in this Assignment and Servicing Agreement with respect to any of the Leases or the Equipment subject thereto will not constitute a Servicer Event of Default if the Originator purchases such Lease and the Issuer's interest in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator Equipment in accordance with this Assignment and the Trustee that the Servicer is diligently pursuing remedial actionServicing Agreement;
(iiiv) The filing an involuntary petition or proceeding shall be filed (A) in respect of a petition against the Servicer under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or (B) seeking a decree or order adjudging the Servicer bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, or composition of or in a court respect of the Servicer under any applicable federal or agency state law, or supervisory authority having jurisdiction in the premises for the appointment of a custodian, receiver, liquidator, assignee, trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingssequestrator, or for other similar official of the Servicer or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and either (1) such petition shall not have been dismissed within a period of 60 consecutive days or (2) any such order for relief or decree shall be entered in any such proceeding, or any such receiver, liquidator, assignee, trustee, sequestrator or other similar official shall be appointed;
(vi) the continuance commencement by the Servicer of a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or of any such other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order unstayed and for relief in effect for respect of the Servicer in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a period petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by it to the filing of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent such petition or to the appointment of or taking possession by a conservator or receiver or liquidator custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar person in any insolvency, readjustment official of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all any substantial part of its property, or a decree or order the making by it of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or failure by the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; orsuch action;
(vii) any reduction or withdrawal of the ratings failure of the Servicer as a servicer of subprime mortgage loans by to make one or more payments due with respect to aggregate recourse debt or other obligations exceeding $5,000,000, or the occurrence of any event or the existence of any condition, the effect of which event or condition is to cause (or permit one or more Persons to cause) more than $5,000,000 of aggregate recourse debt or other obligations of the Rating Agencies that maintains a servicer rating system Servicer to become due before its (or their) stated maturity or before its (or their) regularly scheduled dates of payment so long as such failure, event or condition shall be continuing and a rating on shall not have been waived by the Certificates Person or Persons entitled to “below average” or below; orperformance;
(viii) a final judgment or judgments (or decrees or orders) for the failure by the Servicer to comply, within the required time periods, with Section 3.09 payment of money aggregating in excess of $5,000,000 and any one of such judgments (or the certification described under Section 3.10decrees or orders) has remained unsatisfied and in effect for any period of 60 consecutive days without a stay of execution;
(ix) so long as IOS Capital is the failure by the Servicer to provideServicer, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 downgrading of the Slong-term debt rating assigned by ▇▇▇▇▇▇▇-▇▇▇▇'▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability or S&P to perform any of its duties under this Agreement.IOS Capital to Ba2 or below or BB or below, respectively;
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) abovefor any three consecutive Due Periods, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer average of the Trustee or Annualized Default Rates for such Due Periods shall be greater than 8.00%; or
(xi) for any three consecutive Due Periods, the average of the Securities Administrator of Delinquency Rates for such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 Due Periods shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationgreater than 10.00%.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Assignment and Servicing Agreement (Ikon Receivables LLC)
Servicer Events of Default. (a) If Notwithstanding Section 8.03 of the Basic Servicing Agreement, only the occurrence and continuation of any one of the following events (will be an “Exchange Note Servicer Event of Default” with respect to the 2017-A Exchange Note, and the “Exchange Note Servicer Events of Default”” set forth in Section 8.03(a) of the Basic Servicing Agreement shall occur and be continuingnot apply to the 2017-A Exchange Note or to this 2017-A Servicing Supplement:
(i) (A) The any failure by the Servicer to make deliver to the Indenture Trustee any Monthly Advance which proceeds or payment required to be so delivered with respect to the 2017-A Exchange Note under the Basic Servicing Agreement or this 2017-A Servicing Supplement that continues unremedied for a period ten Business Days after the earlier of one the date on which (1A) Business Day after it was due; notice of such failure is given to the Servicer by the Indenture Trustee or (B) an Authorized Officer of the Servicer has actual knowledge of such failure;
(ii) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, perform in any material respect, respect any other covenants, obligations of its covenants or agreements of in the Servicer as set forth in this 2017-A Servicing Agreement, which failure materially and adversely affects the rights of holders of interests of in the 2017-A Exchange Note, the Noteholders or, in the event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which continues unremedied for a period of sixty (60) days, 90 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been thereof is given to the Servicer by the Master ServicerIndenture Trustee;
(iii) any representation, warranty or statement of the Servicer made in the 2017-A Servicing Agreement or any certificate, report or other writing delivered pursuant to the 2017-A Servicing Agreement shall prove to be incorrect in any material respect when made, which failure materially and adversely affects the rights of holders of interests in the 2017-A Exchange Note, the Securities Administrator or Noteholders or, in the Trustee or event that Certificates are sold to unaffiliated third parties, the Certificateholders, and which failure continues unremedied for 90 days after written notice thereof is given to the Servicer and by the Master Indenture Trustee; or
(iv) the occurrence of an Insolvency Event with respect to the Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that the occurrence of any event set forth in the case of a failure that cannot be cured within sixty clauses (60i) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
through (iii) The filing with respect to the 2017-A Reference Pool will be an Exchange Note Servicer Event of Default only with respect to the 2017-A Reference Pool and will not be a petition against Servicer Event Default with respect to any other Reference Pool or the Servicer Revolving Facility Pool. Notwithstanding the foregoing, a delay in a court or agency failure of performance referred to under clause (i), (ii) or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect (iii) for a period of thirty (30) consecutive days; or
(iv) The 120 days will not constitute an Exchange Note Servicer shall voluntarily go into liquidationEvent of Default if that failure or delay was caused by Force Majeure. Upon the occurrence of any such event, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating will not be relieved from using all commercially reasonable efforts to all or substantially all of perform its property, or obligations in a decree or order of a court or agency or supervisory authority having jurisdiction timely manner in accordance with the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal terms of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system Basic Servicing Agreement and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, any required reports or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇this 2017-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementA Servicing Supplement.
(b) thenWith respect to actions taken under Section 8.03(c) of the Basic Servicing Agreement after the occurrence of an Exchange Note Servicer Event of Default, and in each and every any actions to be taken by the 2017-A Exchange Noteholder thereunder shall be exercised by the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class.
(c) In accordance with Section 8.05 of the Basic Servicing Agreement, after the occurrence of an Exchange Note Servicer Event of Default, the 2017-A Exchange Noteholder (which for purposes of this Section shall be the Indenture Trustee, acting at the direction of 66 2/3% of the Holders of the Outstanding Amount of the Controlling Class) may waive any such case, so long as a Servicer Event of Default shall not and its consequences. Upon any such waiver, the applicable Exchange Note Servicer Event of Default will cease to exist, and will be deemed to have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt remedied for every purpose of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. No such waiver will extend to any subsequent or other event or impair any right consequent thereon.
(d) On or after the receipt by the Servicer of such written noticenotice of an Exchange Note Servicer Event of Default, all authority and power of the Servicer under this Agreement2017-A Servicing Supplement, whether with respect to the Certificates or Notes, the Mortgage Loans Certificates, the Trust Estate or otherwise, shall shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed pursuant to the terms of the Basic Servicing Agreement. If the Indenture Trustee shall become Successor Servicer pursuant to and under this Section 8.01; and, without limitation7.01(a), the Successor Indenture Trustee shall be entitled to appoint as sub-Servicer is hereby authorized and empowered to execute and deliver, on behalf any one of its Affiliates or agents; provided that the Servicer, Indenture Trustee in its capacity as attorney-in-fact Servicer shall be fully liable for the actions or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes omissions of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, Affiliate or otherwiseagent in such capacity as sub-Servicer. The outgoing Servicer agrees to shall cooperate with the Successor ServicerIndenture Trustee, the Master Servicer, the Securities Administrator Owner Trustee and the Trustee such Successor Servicer in effecting the termination of the responsibilities and rights of the outgoing Servicer hereunderunder this 2017-A Servicing Supplement, including, without limitation, including the transfer to the Indenture Trustee or such Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor outgoing Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer outgoing Servicer, in the Collection Account 2017-A Bank Accounts or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs 2017-A Leases and other reasonable out2017-of-pocket costs A Vehicles and expenses (including attorneys’ fees) incurred in connection with all information or documents that the termination Indenture Trustee or such Successor Servicer may require, and the Successor Servicer shall not be liable if it cannot perform due to the failure of the predecessor Servicer to so deliver. In addition, the Servicer shall transfer its electronic records relating to the 2017-A Leases and transferring the Mortgage Files 2017-A Vehicles to the Successor Servicer and amending this Agreement to reflect in such succession electronic form as the Successor Servicer pursuant to this Section 8.01 may reasonably request. All Transition Costs shall be paid by the predecessor outgoing Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid (or by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, initial Servicer if the predecessor outgoing Servicer is the Master Servicer, by the initial Servicer), Indenture Trustee acting on an interim basis) upon presentation of reasonable documentation of such costs and expenses.
(e) Notwithstanding Section 7.01(d), if the Indenture Trustee shall be unwilling so to act or if it is legally unable so to act, a Successor Servicer shall be appointed in accordance with Section 8.04 of the Basic Servicing Agreement. If Compensation for any Successor Servicer shall not be greater than that payable to MBFS USA as initial Servicer hereunder without the predecessor prior consent of the Majority Noteholders of the Controlling Class (or Holders of Certificates representing not less than 51% of the aggregate Certificate Percentage Interests then outstanding if the Notes are no longer Outstanding). The Indenture Trustee and such successor shall take such action, consistent with this 2017-A Servicing Supplement, as shall be necessary to effectuate any such succession. The Indenture Trustee shall not be relieved of its duties as Successor Servicer is required but fails under this Section until a newly appointed Servicer shall have assumed the obligations and duties of the terminated Servicer under this 2017-A Servicing Supplement. Notwithstanding anything to pay the amounts specified contrary contained herein, in no event shall the Indenture Trustee be liable for any servicing fee or for any differential in the preceding sentence and such amounts are amount of the servicing fee paid by the Trusthereunder, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action amount necessary to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding induce any termination of the activities of the Successor Servicer to act as Successor Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion responsibilities of the Servicing Fees to which the Servicer would have been entitled set forth in Sections 3.05 and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination 3.10 hereunder, or the obligations with respect to events occurring prior to such termination.
the payment or reimbursement of fees, expenses or other amounts (cincluding indemnities other than those resulting from the actions of the Indenture Trustee as successor Servicer) Upon of the occurrence of a Servicer Event of DefaultOwner Trustee, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Indenture Trustee or the Securities Administrator to direct Asset Representations Reviewer, the Master Servicer to remove) fees and expenses of the Servicer pursuant to clause (b) above. In Owner Trustee’s attorneys, the event Indenture Trustee’s attorneys, or the Master Servicer fails to deliver an Extension Notice prior Asset Representations Reviewer’s attorneys, the fees and expenses of any custodian and the fees and expenses of independent accountants or expenses incurred in connection with distributions and reports to the end of any Servicer Term of Service, the Servicer shall be automatically terminatedNoteholders.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: 2017 a Servicing Supplement (Mercedes-Benz Auto Lease Trust 2017-A)
Servicer Events of Default. (a) If any one Any of the following events (“acts or occurrences shall constitute a Servicer Events Event of Default”) shall occur and be continuing:
(i) (A) The Any failure by the Servicer to make deliver to the Indenture Trustee for payment to Noteholders any Policy Proceeds in respect of the Trust Estate required to be so delivered under the terms of the Amended and Restated Indenture and this Agreement that continues unremedied until 1:00 P.M., New York time, on the second Business Day following the Payment Date; provided, however, that the Indenture Trustee, upon receiving actual knowledge of such failure, shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Indenture Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(ii) Any failure by the Servicer to deliver a Monthly Advance Servicing Report pursuant to Section 6.01 hereof that continues unremedied until 1:00 P.M., New York time, the following Business Day; provided, however, that if the Servicer has not delivered the Monthly Servicing Report by 5:00 P.M., New York time, on the Submission Date, the Indenture Trustee shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Indenture Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(iii) Any failure on the part of the Servicer duly to observe or perform in any material respect any other covenants or agreements of the Servicer set forth in this Agreement or the Amended and Restated Indenture, as the case may be, or if any representation or warranty of the Servicer set forth in Section 3.02 hereof shall prove to be incorrect, which failure or breach (A) is likely to have or has had a material adverse effect on the interests or rights of the Indenture Trustee or the Noteholders and (B) continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 30 days after the date on which (x) the Servicer becomes aware of such failure or breach or (y) written notice of such failure, failure or breach requiring the same situation giving rise to such breach or non-conformity to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator Indenture Trustee or the Trustee Issuer, or to the Servicer and the Master ServicerIndenture Trustee by Holders of Notes representing not less than 25% of the Outstanding Principal Balance; or
(iv) Any assignment by the Servicer to a delegate of its duties or rights under this Agreement, the Securities Administrator except as specifically permitted hereunder, or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%attempt to make such an assignment; provided, however, that in the case or
(v) The entry of a failure that cannot be cured within sixty (60) days, the cure period may be extended if decree or order for relief by a court having jurisdiction in respect of the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of or a petition against the Servicer in an involuntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy insolvency or similar law, or appointing a court receiver, liquidator, assignee, trustee, custodian, sequestrator or agency or supervisory authority having jurisdiction in the premises other similar official for the appointment Servicer or for any substantial part of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingsits property, or for ordering the winding up or liquidation of its affairs, the affairs of the Servicer and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) 60 consecutive days; or
(ivvi) The commencement by the Servicer shall voluntarily go into liquidationof a voluntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy, insolvency, reorganization or similar law, or the consent by the Servicer to the appointment of or taking possession by a conservator conservator, receiver, liquidator, assignee, trustee, custodian, sequestrator or receiver or liquidator or other similar person official in any insolvency, readjustment of debt, marshaling marshalling of assets and liabilities liabilities, bankruptcy or similar proceedings of or relating to the Servicer or of or relating to all or substantially all a substantial part of its property, or a decree or order the making by the Servicer of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up failure by the Servicer generally to pay its debts as such debts become due or liquidation of its affairs, shall have been entered against the Servicer; or if the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage or the taking of corporate action by the Servicer in furtherance of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loansforegoing; or
(vii) The Servicer (if PWCC is then the Servicer) fails, within 45 days after entry, to pay, bond, or otherwise discharge any reduction or withdrawal judgment in excess of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating $250,000, unless such judgment is then stayed on the Certificates to “below average” or belowappeal; or
(viii) The Servicer (if PWCC is then the failure by Servicer) defaults in the Servicer to comply, payment of any principal or interest due in excess of $250,000 in the aggregate and such default is not waived or cured within the required time periods, with Section 3.09 or the certification described under Section 3.10;any applicable grace period; or
(ix) Any Event of Default under the failure by the Servicer Indenture occurs that is not waived and that is not attributable solely to provide, within the time frame specified herein, any required reports an act or data pertaining to the Mortgage Loans, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 omission of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses Indenture Trustee in connection with its capacity as Indenture Trustee under the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementIndenture.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall not have been remediedremedied within the period set forth in (i), (xii) with respect solely to clause or (a)(i)(Aiii) above, as applicable, or if a Servicer Event of Default described in (1iv), (vii) on or (viii) above occurs, the related Deposit DateIssuer may, or the Indenture Trustee shall upon receipt instruction by the Majority Noteholders, or if a Servicer Event of Default described in (v) or (vi) above occurs, the Indenture Trustee shall upon receiving written notice or discovery thereof, by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Datethe "Servicer Default Notice") of the failure then given in writing to make a Monthly Advance to a Servicing Officer of the Servicer andterminate all, to the extent the applicable current contact information has been provided to the Master Servicerbut not less than all, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer and Agreement.
(yc) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after the receipt by the Servicer of such written noticea Servicer Default Notice and the assumption of duties by the successor Servicer, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates Notes or the Mortgage Loans Policies or otherwise, shall pass to and be vested in the Successor successor Servicer appointed pursuant to Section 8.03 hereof. The Indenture Trustee shall not be deemed to have actual knowledge of a Servicer Event of Default (other than under paragraphs (i) and (ii) above), until a Responsible Officer of the Indenture Trustee shall have received written notice or actual knowledge thereof. In addition to any other amounts that are then payable to the Servicer under this Section 8.01; and, without limitationAgreement, the Successor Servicer is hereby authorized and empowered shall be entitled to execute and deliver, on behalf receive reimbursements for any unreimbursed payments of premiums made during the Servicer, as attorney-in-fact period or otherwise, any and all documents and other instruments, and expenses previously approved by the Noteholders prior to do or accomplish all other acts or things necessary or appropriate the delivery of a Servicer Termination Notice pursuant to effect this Section 7.01 which terminates the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities obligations and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Contribution, Sale and Servicing Agreement (Point West Capital Corp)
Servicer Events of Default. (a) If any one of the The following events (“shall each constitute a "Servicer Events Event of Default”) shall occur and be continuing" hereunder:
(i) (A) The any failure by the Servicer to make remit to the Indenture Trustee any Monthly Advance payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below), which continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, after the date on upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer and the Note Insurer by the Master Servicer, the Securities Administrator or the Indenture Trustee or to the Servicer and the Master Servicer, Indenture Trustee by the Securities Administrator Note Insurer or the Trustee, by any Holder with Certificates Noteholders of Notes evidencing Voting Rights Percentage Interests of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; or the Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viiiii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10;
(ix) the failure by the Servicer to provide, within the time frame specified herein, make any required reports or data pertaining to the Mortgage LoansServicing Advance, which failure continues unremedied for a period of fifteen 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 Servicer by the Master Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(iii) any failure on the part of the Servicer duly to observe or perform in any material respect any other of the covenants or agreements on the part of the 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 Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by any Noteholder or the Note Insurer;
(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 Servicer and such decree or order shall have remained in force, undischarged or unstayed for a period of ninety (90) days;
(v) the 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 Servicer or of or relating to all or substantially all of the Servicer; or's property;
(vi) the 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 12.50% of the aggregate outstanding Principal Balance for the Mortgage Loans;
(ix) if on any Payment Date, commencing in September 2001, the Twelve Month Loss Amount exceeds 2.50% of the sum of aggregate outstanding Principal Balance for the Mortgage Loans, as of the close of business on the first day of the twelfth preceding calendar month;
(x) if on any Payment Date, the identification occurrence of a Company Stockholders' Equity Trigger; and
(xi) the occurrence of an Event of Default under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this AgreementIndenture.
(b) then, and in each and every such case, so So long as a Servicer Event of Default shall have occurred and not have been remedied, : (x) with respect solely to clause (a)(i)(A) aboveSection 7.01(a)(i), (1) if such payment is in respect of Periodic Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the related Deposit second Business Day prior to the applicable Payment Date, the Indenture Trustee, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give immediate telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic facsimile notice of such failure to a Servicing Officer of the Servicer and to the Master Servicer shall direct Note Insurer and the Indenture Trustee to shall, with the consent of the Note Insurer, terminate all of the rights and obligations of the Servicer under this Agreement Agreement, except for the Servicer's indemnification obligation under Section 5.19, and the Successor Indenture Trustee, or a successor Servicer appointed in accordance with Section 8.02 7.02, shall immediately make such Monthly Periodic Advance prior to the distribution or payment of funds on the related Distribution Date Compensating Interest and assume, pursuant to Section 8.027.02 hereof, the duties of a Successor Servicer and successor Servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the case of preceding clause (a)(i)(Cx) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (vii) of Section 7.01, the Indenture Trustee and the Depositor may (and shall shall, but only at the direction of the Holders of Offered Certificates evidencing not less than 51% of all Note Insurer or the Majority Noteholders, by notice in writing to the Servicer and a Responsible Officer of the Voting Rights) Indenture Trustee and subject to the prior written consent of the Note Insurer, in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, any removal at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given Majority Noteholders, and in writing addition to the Sellerwhatever rights such Noteholders may have at law or equity to damages, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies including injunctive relief and if given by Holders of Certificates, to the Trusteespecific performance, terminate all of the rights and obligations of the Servicer as servicer under this Agreement, except for the Servicer's indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as servicer; and (z) with respect to clauses (viii)-(x) of Section 7.01(a), the Indenture Trustee shall, but only at the direction of the Note Insurer, after notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Servicer under this Agreement, except for the Servicer's indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer. On or after Upon receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall shall, subject to Section 7.02, pass to and be vested in the Successor Servicer pursuant to Indenture Trustee, or its designee approved by the Note Insurer, and under this Section 8.01; and, without limitation, the Successor Servicer Indenture Trustee is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments, instruments and to do or accomplish cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete including, but not limited to, the transfer and endorsement or assignment of each the Mortgage Loan Loans and related documents, or otherwise. The Servicer agrees to cooperate (and pay any related costs and expenses) with the Successor Servicer, the Master Servicer, the Securities Administrator and the Indenture Trustee in effecting the termination of the Servicer's responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer Indenture Trustee, or its designee, for the administration by it of all cash amounts that which shall at the time be held credited by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs The Indenture Trustee shall promptly notify the Note Insurer and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination Rating Agencies of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Sale and Servicing Agreement (Prudential Securities Secured Financing Corp)
Servicer Events of Default. Each of the following shall constitute a “Servicer Event of Default” on the part of the Servicer:
(a) If any one of the following events (“Servicer Events of Default”) shall occur and be continuing:
(i) (A) The Any failure by the Servicer to make observe or perform in any Monthly Advance which continues unremedied for a period material respect any of one (1) Business Day after it was due; the terms, covenants or (B) any other failure by agreements on the part of the Servicer to deposit set forth in the Collection Account this Mortgage Loan Purchase and Servicing Agreement, any Transfer Supplement or the Distribution Account any deposit required to be made under the terms of this Custodial Agreement which continues unremedied for a period of two (2other than those set forth in clause (i) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(ibelow) which continues unremedied for a period of one forty-five (145) Business Day days after it was duethe date on which the Servicer has actual knowledge or written notice of such failure;
(iib) Any representation, warranty, statement or certification made by the Servicer shall prove to have been incorrect in any material respect as of the time when made, and which continues to be incorrect in any material respect for forty-five (A45) The days after the date on which the Servicer has actual knowledge or written notice of such incorrect representation, warranty, statement or certification;
(c) Any failure by the Servicer to make maintain any required Servicing Advance licenses to do business in any jurisdiction where the Mortgaged Property is located, which failure has a material adverse effect on the ability of the Servicer to perform its functions under this Mortgage Loan Purchase and Servicing Agreement or materially impairs the value of the Mortgage Loans, and which continues to be unremedied for a period of sixty forty-five (6045) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, days after the date on which the Servicer has actual knowledge or written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer, the Securities Administrator or the Trustee or to the Servicer and the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iiid) The filing of a petition against the Servicer in a court or agency or supervisory authority having jurisdiction in the premises Application for the appointment of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the appointment of a conservator or receiver or liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to the Servicer or of or relating to all or substantially all of its propertyincluding bankruptcy, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling marshalling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Servicer; Servicer and, if such proceeding is being contested by the Servicer in good faith, such decree or the order shall have remained in force undischarged or unstayed for a period of forty-five (45) days;
(e) The Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable bankruptcyinsolvency, insolvency bankruptcy or reorganization statute, make an assignment for the benefit of its creditors or creditors, voluntarily suspend payment of its obligations; or
obligations or cease its normal business operations for six (v6) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure by the Servicer to comply, within the required time periods, with Section 3.09 or the certification described under Section 3.10Business Days;
(ixf) The Company or Performance Guarantor or any Affiliate thereof enters into a consent agreement or otherwise agrees in writing with any federal or state regulatory agency or authority to restrict its activities, if the failure default of such agreement by the Servicer Company or Performance Guarantor or any Affiliate thereof entitles such applicable federal or state agency to provide, within place the time frame specified herein, Company or Performance Guarantor in receivership or conservatorship;
(g) The Company or Performance Guarantor shall fail to pay (after expiration of any required reports or data pertaining to applicable grace period) (i) any of its debt obligations in excess of the Mortgage Loans, which failure continues unremedied for a period lesser of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Servicer; or
(x) the identification under any filing pursuant to Section 404 of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreement.
(b) then, and in each and every such case, so long as a Servicer Event of Default shall not have been remedied, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of such failure, the Master Servicer shall give telephonic notice (by no later than 5:00 p.m. New York time on such Deposit Date) of the failure to make a Monthly Advance to a Servicing Officer of the Servicer and, to the extent the applicable current contact information has been provided to the Master Servicer, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations of the Servicer under this Agreement and the Successor Servicer appointed in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution of funds on the related Distribution Date and assume, pursuant to Section 8.02, the duties of a Successor Servicer $5,000,000 and (y) 2% of shareholder’s equity of the Performance Guarantor in the case of clause (a)(i)(C) the Trustee and the Depositor may (and shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to the Trustee, terminate all of the rights and obligations of the Servicer as servicer under this Agreement. On or after receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates or the Mortgage Loans or otherwise, shall pass to and be vested in the Successor Servicer pursuant to and under this Section 8.01; and, without limitation, the Successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator and the Trustee in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Account, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket costs and expenses (including attorneys’ fees) incurred in connection with the termination of the Servicer and transferring the Mortgage Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, aggregate or, to the extent not paid by the predecessor Servicer, by the Trust prior to distributions to Certificateholders (or, if the predecessor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence and such amounts are paid by the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such termination.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
Appears in 1 contract
Sources: Mortgage Loan Purchase and Servicing Agreement (Accredited Home Lenders Holding Co)
Servicer Events of Default. (a) If any one Any of the following events (“acts or occurrences shall constitute a Servicer Events Event of Default”) shall occur and be continuing:
(i) any failure by the Servicer (A) The to deliver to the Local Bank for deposit in the Local Bank Account or (B) to deliver or cause to be delivered to the Trustee for deposit in the Collection Account any proceeds or payments received from an Obligor or in respect of the Trust Estate and required to be so delivered under the terms of the Indenture and this Agreement that continues unremedied until 2:00 p.m., New York time, on the second successive Business Day following such failure; or provided, however, that the Trustee, upon receiving actual knowledge of such failure, shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(ii) any failure by the Servicer to deliver a Monthly Servicer's Report pursuant to Section 4.01 hereof that continues unremedied until 2:00 p.m., New York time, the following Business Day; provided, however, that if the Trustee has actual knowledge that the Servicer has not delivered such Monthly Servicer's Report by 2:00 p.m., New York time, on a Determination Date, the Trustee shall give the Servicer written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(iii) any failure by the Servicer to remit any Purchase Price received by it to the Trustee that continues unremedied until 5:00 p.m., New York time, the following Business Day; provided, however, that if the Servicer has not remitted any Purchase Price received by it to the Trustee by 3:00 p.m., New York time, on the Determination Date and the Trustee has actual knowledge that such Purchase Price has not been paid, the Trustee shall give the Servicer prompt written, telecopied or telephonic notice of such failure. Notwithstanding the foregoing, any failure by the Trustee to deliver such notice to the Servicer shall not prevent the occurrence of a Servicer Event of Default; or
(iv) any failure by the Servicer to make remittances (other than a remittance of Purchase Price referred to in clause (iii) above) or deliver notices pursuant to Section 3.03 hereof, that continues unremedied until 2:00 p.m., New York time, of the second successive Business Day; or
(v) any Monthly Advance failure on the part of the Servicer duly to observe or perform any other covenants or agreements of the Servicer set forth in this Agreement or the Indenture or any representation or warranty of the Servicer set forth in Section 2.01 of this Agreement shall prove to be incorrect in any material respect, which failure or breach continues unremedied for a period of one (1) Business Day after it was due; or (B) any other failure by the Servicer to deposit in the Collection Account or the Distribution Account any deposit required to be made under the terms of this Agreement which continues unremedied for a period of two (2) Business Days after such deposit was due or (C) the failure by the Servicer to make any remittances into the Distribution Account required pursuant to Section 3.03(i) which continues unremedied for a period of one (1) Business Day after it was due;
(ii) (A) The failure by the Servicer to make any required Servicing Advance which failure continues unremedied for a period of sixty (60) days, or (B) the failure by the Servicer duly to observe or perform, in any material respect, any other covenants, obligations or agreements of the Servicer as set forth in this Agreement, which failure materially and adversely affects the interests of the Certificateholders, continues unremedied for a period of sixty (60) days, 30 days after the date on which the Servicer becomes aware of such failure or breach, or receives written notice of such failure, requiring the same to be remedied, shall have been given to failure or breach; or
(vi) any assignment by the Servicer to a delegate of its duties or rights under this Agreement, except as specifically permitted hereunder, or any attempt to make such an assignment; or
(vii) the entry of a decree or order for relief by the Master Servicer, the Securities Administrator or the Trustee or to a court having jurisdiction in respect of the Servicer and the Master Servicer, the Securities Administrator or the Trustee, by any Holder with Certificates evidencing Voting Rights of at least 25%; provided, however, that in the case of a failure that cannot be cured within sixty (60) days, the cure period may be extended if the Servicer can demonstrate to the reasonable satisfaction of the Master Servicer, the Securities Administrator and the Trustee that the Servicer is diligently pursuing remedial action;
(iii) The filing of a petition against the Servicer in an involuntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy, insolvency or similar law, or appointing a court receiver, liquidator, assignee, trustee, custodian, sequestrator or agency or supervisory authority having jurisdiction in the premises other similar official for the appointment Servicer or for any substantial part of a trustee, conservator, receiver or liquidator in any insolvency, conservatorship, receivership, readjustment of debt, marshaling of assets and liabilities or similar proceedingsits property, or for ordering the winding up or liquidation of its affairs, the affairs of the Servicer and the continuance of any such decree or order unstayed and in effect effect, or failure for such petition to be dismissed, for a period of thirty (30) 60 consecutive days; or
(ivviii) The the commencement by the Servicer shall voluntarily go into liquidationof a voluntary case under any federal bankruptcy laws, as now or hereafter in effect, or any other present or future federal or state bankruptcy, insolvency, reorganization or similar law, or the consent by the Servicer to the appointment of or taking possession by a conservator conservator, receiver, liquidator, assignee, trustee, custodian, sequestrator or receiver or liquidator or other similar person official in any insolvency, readjustment of debt, marshaling of assets and liabilities liabilities, bankruptcy or similar proceedings of or relating to the Servicer or of or relating to all or substantially all a substantial part of its property, or a decree or order the making by the Servicer of a court or agency or supervisory authority having jurisdiction in the premises an assignment for the appointment benefit of a conservator, receiver, liquidator or similar person in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedingscreditors, or for the winding-up failure by the Servicer generally to pay its debts as such debts become due or liquidation of its affairs, shall have been entered against the Servicer; or if the Servicer shall admit in writing its inability to pay its their debts generally as they become due, file a petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer Termination Test is failed; or
(a) any reduction or withdrawal of the ratings or any shadow ratings of any Class of Certificates attributable principally to the Servicer or the servicing taking of the Mortgage Loans or (b) any placement by a Rating Agency of any Class of Certificates on credit watch with negative implications attributable principally to the Servicer or the servicing of the Mortgage Loans; or
(vii) any reduction or withdrawal of the ratings of the Servicer as a servicer of subprime mortgage loans by one or more of the Rating Agencies that maintains a servicer rating system and a rating on the Certificates to “below average” or below; or
(viii) the failure corporate action by the Servicer to comply, within in furtherance of any of the required time periods, with Section 3.09 or the certification described under Section 3.10;foregoing; or
(ix) the failure by stockholders' equity of the Servicer to provideand its consolidated subsidiaries, within the time frame specified hereindetermined in accordance with generally accepted accounting principles, any required reports or data pertaining to the Mortgage Loansas would be shown on a consolidated balance sheet for such Persons, which failure continues unremedied for a period of fifteen days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Master Serviceris below $50,000,000; or
(x) the identification under any filing pursuant to Section 404 occurrence of the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which identifies material weaknesses in connection with the Servicer’s ongoing evaluation of internal controls which materially and adversely affect the Servicer’s ability to perform any of its duties under this Agreementa Trigger Event.
(b) then, and in each and every such case, so long as If a Servicer Event of Default shall not have been remediedoccurred and be continuing, (x) with respect solely to clause (a)(i)(A) above, (1) on the related Deposit DateTrustee shall, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer direction of the Trustee or Holders of Notes representing not less than 66-2/3% in principal amount of the Securities Administrator Outstanding Notes of such failurethe Controlling Class, the Master Servicer shall give telephonic by notice (by no later than 5:00 p.m. New York time on such Deposit Datethe "Servicer Termination Notice") of the failure given in writing to make a Monthly Advance to a Servicing Officer of the Servicer andterminate all, to the extent the applicable current contact information has been provided to the Master Servicerbut not less than all, the Servicing Rights Pledgee and (2) on the Business Day immediately following the related Deposit Date, upon receipt of written notice or discovery by the Master Servicer or a Responsible Officer of the Trustee or of the Securities Administrator of the continued failure to make such Monthly Advance, the Master Servicer shall promptly give telephonic notice of such failure to a Servicing Officer of the Servicer and the Master Servicer shall direct the Trustee to terminate all of the rights and obligations (except as expressly provided herein) of the Servicer under this Agreement Agreement. Notwithstanding the foregoing, a delay in or failure of performance under Sections 6.01(a)(ii) or 6.01(a)(v) hereof for a period of more than 30 or more days shall not constitute a Servicer Event of Default if such delay or failure could not have been prevented by the exercise of reasonable diligence by the Servicer and such delay or failure was caused by acts of declared or undeclared war, public disorder, rebellion or sabotage, epidemics, landslides, lightning, fire, hurricanes, earthquakes, floods or similar causes; provided, however, that in any event, such delay or failure shall constitute a Servicer Event of Default if it continues unremedied for a period of 30 days. The preceding sentence shall not relieve the Successor Servicer appointed from using its best efforts to perform its obligations in a timely manner in accordance with Section 8.02 shall immediately make such Monthly Advance prior to the distribution terms of funds on the related Distribution Date and assumethis Agreement, pursuant to Section 8.02, the duties of a Successor Servicer and (y) in the case of clause (a)(i)(C) the Trustee and the Depositor may (and Servicer shall at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights) and in the case of clause (a)(i)(B) and (ii) through (x) above, the Trustee shall, at the direction of the Holders of Offered Certificates evidencing not less than 51% of all of the Voting Rights by notice then given in writing to the Seller, the Servicer, the Master Servicer, the Servicing Rights Pledgee (to the extent the applicable current contact information has been provided to the Master Servicer), the Rating Agencies and if given by Holders of Certificates, to provide the Trustee, terminate all the Issuer and the Noteholders with prompt notice of the rights and obligations such failure or delay by it, together with a description of the Servicer as servicer under this Agreement. its efforts to so perform its obligations.
(c) On or after the receipt by the Servicer of such written noticea Servicer Termination Notice, all authority and power of the Servicer under this Agreement, whether with respect to the Certificates Notes or the Mortgage Loans Contracts or otherwise, shall pass to and be vested in the Successor successor Servicer appointed pursuant to and under this Section 8.01; 6.02 hereof, and, without limitation, the Successor such successor Servicer is hereby authorized and empowered to execute and deliver, on behalf of the such Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of each Mortgage Loan the Contracts and related documents, or otherwise. The Servicer agrees to cooperate with the Successor Servicer, the Master Servicer, the Securities Administrator Trustee and the Trustee successor Servicer in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor successor Servicer for the administration by it of all cash amounts that shall at the time be held by the predecessor Servicer and to be deposited by it in the Collection Accountfor deposit, or that have been deposited by the predecessor Servicer in the Collection Account or thereafter received by the predecessor Servicer with respect to Contracts. To assist the Mortgage Loans. All Servicing Transfer Costs and other reasonable out-of-pocket successor Servicer in enforcing all rights under the Contracts, the outgoing Servicer, at its own expense (including, without limitation, any costs and or expenses (including attorneys’ fees) incurred in connection associated with the termination complete transfer of all servicing data and the completion, correction or manipulation of such servicing data as may be required by the successor Servicer to correct any errors or insufficiencies in the servicing data or otherwise to enable the successor Servicer to service the Contracts properly and transferring the Mortgage Files effectively to the Successor successor Servicer in such form as the successor Servicer may reasonably request), shall transfer its records (electronic and amending this Agreement otherwise) relating to reflect such succession as Servicer pursuant to this Section 8.01 Contracts and shall be paid by transfer the predecessor Servicer within 90 days of written demand, itemized in reasonable detail, or, related Contracts (to the extent not paid held by the predecessor ServicerTrustee) and all other records, by correspondence and documents relating to the Trust prior Contracts that it may possess to distributions to Certificateholders (or, if the predecessor successor Servicer is the Master Servicer, by the initial Servicer), upon presentation of reasonable documentation of such costs and expenses. If the predecessor Servicer is required but fails to pay the amounts specified in the preceding sentence manner and at such amounts are paid by times as the Trust, the Securities Administrator shall, at the direction and expense of the Class C Certificateholders, take appropriate action to enforce such obligation and recover such amounts on behalf of such Class C Certificateholders. Notwithstanding any termination of the activities of the Servicer hereunder, the successor Servicer shall continue to be entitled to receive from the Trust, payment of all the accrued and unpaid portion of the Servicing Fees to which the Servicer would have been entitled and reimbursement for all outstanding Monthly Advances and Servicing Advances, including but not limited to trailing expenses representing Servicing Advances incurred by the Servicer prior to but invoiced after the date of termination, which amount shall be remitted by the Successor Servicer to the terminated Servicer as permitted under Section 3.03 on a first-in, first-out basis. The Servicer shall continue to be entitled to the benefits of Section 7.03, notwithstanding any termination hereunder, with respect to events occurring prior to such terminationreasonably request.
(c) Upon the occurrence of a Servicer Event of Default, the Servicer shall act as Servicer under this Agreement, subject to the right of removal set forth in subsection (b) hereof, for an initial period commencing on the date on which such Servicer Event of Default occurred and ending on the last day of the calendar quarter in which such Servicer Event of Default occurred, which period may be extended by the Master Servicer (an “Extension Notice”) for a succeeding quarterly period ending on December 31, March 31, June 30 and September 30 of each year (each such quarterly period for which the Servicer shall be designated to act as Servicer hereunder, a “Servicer Term of Service”) until such time as the Master Servicer, the Securities Administrator and the Trustee receives written direction from the Holders of Certificates evidencing at least 51% of the Voting Rights not to deliver an Extension Notice, in which event the Master Servicer shall follow such direction; provided that nothing in this clause (c) shall prohibit the Master Servicer from removing (or prohibit Certificateholders from directing the Trustee or the Securities Administrator to direct the Master Servicer to remove) the Servicer pursuant to clause (b) above. In the event the Master Servicer fails to deliver an Extension Notice prior to the end of any Servicer Term of Service, the Servicer shall be automatically terminated.
(d) If the Successor Servicer or another Person succeeds to the obligations of Servicer hereunder, the term of the Successor Servicer or such Person shall not be limited unless and until a Servicer Event of Default thereafter occurs with respect to such Successor Servicer or other Person. At such time, the provisions of Section 8.01 (c) and (d) shall become applicable to the then-acting Servicer and the Person then-obligated to succeed such then-acting Servicer.
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