exhibit 99.2
ORIGEN FINANCIAL L.L.C.,
as Servicer,
ORIGEN SERVICING, INC.,
as Subservicer and Administrator,
ORIGEN RESIDENTIAL SECURITIES, INC.,
as Depositor,
ORIGEN MANUFACTURED HOUSING CONTRACT TRUST 2007-A
as Issuing Entity
and
THE BANK OF NEW YORK TRUST COMPANY, N.A.
as Indenture Trustee,
SERVICING AGREEMENT
Dated as of April 1, 2007
Manufactured Housing Installment Sales Contracts
and Installment Loan Agreements
Origen Manufactured Housing Contract Trust 2007-A
TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
Section 1.01. Definitions.............................................. 2
Section 1.02. Other Definitional Provisions............................ 2
Section 1.03. Interest Calculations.................................... 3
ARTICLE II
REPRESENTATIONS AND WARRANTIES
Section 2.01. Covenants, Representations and Warranties Regarding the
Servicer.............................................. 3
Section 2.02. Existence................................................ 4
Section 2.03. Enforcement of Representations and Warranties............ 4
ARTICLE III
ADMINISTRATION AND SERVICING OF CONTRACTS
Section 3.01. Responsibility for Contract Administration............... 5
Section 3.02. Standard of Care......................................... 6
Section 3.03. Records.................................................. 6
Section 3.04. Inspection: Electronic File.............................. 6
Section 3.05. Collection Account....................................... 7
Section 3.06. Permitted Withdrawals.................................... 8
Section 3.07. Enforcement.............................................. 9
Section 3.08. Indenture Trustee to Cooperate........................... 11
Section 3.09. Costs and Expenses....................................... 11
Section 3.10. Maintenance of Insurance................................. 12
Section 3.11. Repossession............................................. 13
Section 3.12. Subservicing Arrangements................................ 14
Section 3.13. Retitling; Security Interests............................ 15
Section 3.14. Payment of Taxes......................................... 15
Section 3.15. Annual Statement as to Compliance........................ 16
Section 3.16. Annual Assessment and Attestation........................ 17
Section 3.17. Optional Redemption...................................... 18
Section 3.18. Net Contract Rate........................................ 19
ARTICLE IV
SERVICING CERTIFICATE
Section 4.01. Electronic Files......................................... 19
Section 4.02. Reserved................................................. 19
Page
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ARTICLE V
THE SERVICER
Section 5.01. Liability of the Servicer................................ 19
Section 5.02. Merger or Consolidation of or Assumption of the
Obligations of the Servicer........................... 19
Section 5.03. Limitation on Liability of the Servicer and Others....... 20
Section 5.04. Servicer Not to Resign................................... 20
Section 5.05. Delegation of Duties..................................... 21
Section 5.06. Rights of the Issuing Entity in Respect of the Servicer.. 21
Section 5.07. Indemnification.......................................... 21
ARTICLE VI
DEFAULT
Section 6.01. Servicer Events of Default............................... 22
Section 6.02. Transfer................................................. 23
Section 6.03. Appointment of Successor Servicer........................ 24
Section 6.04. Notification to Noteholders.............................. 25
Section 6.05. Effect of Transfer....................................... 25
Section 6.06. Transfer of Collection Account........................... 26
ARTICLE VII
MISCELLANEOUS PROVISIONS
Section 7.01. Amendment................................................ 26
Section 7.02. GOVERNING LAW............................................ 26
Section 7.03. Notices.................................................. 26
Section 7.04. Severability of Provisions............................... 28
Section 7.05. Third-Party Beneficiaries................................ 28
Section 7.06. Counterparts............................................. 29
Section 7.07. Effect of Headings and Table of Contents................. 29
Section 7.08. Termination.............................................. 29
Section 7.09. No Petition.............................................. 29
Section 7.10. No Recourse.............................................. 29
Section 7.11. Indenture Trustee Rights................................. 29
Section 7.12. Rights of the Note Insurer to Exercise Rights of
Noteholders........................................... 29
Section 7.13. Reports to Note Insurer.................................. 29
ARTICLE VIII
DUTIES OF THE SUBSERVICER AS ADMINISTRATOR
Section 8.01. Administrative Duties.................................... 30
Section 8.02. Records.................................................. 31
Section 8.03. Additional Information to be Furnished................... 31
Section 8.04. No Recourse to Owner Trustee............................. 32
Section 8.05. Exchange Act Reporting................................... 32
Section 8.06. Indemnification.......................................... 37
(ii)
PAGE
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EXHIBIT A LIST OF CONTRACTS............................................. A-l
EXHIBIT B FORM OF CERTIFICATE REGARDING REPURCHASED CONTRACTS ORIGEN
FINANCIAL L.L.C. CERTIFICATE REGARDING REPURCHASED CONTRACTS.......... B-1
EXHIBIT C-l FORM OF CERTIFICATION TO BE PROVIDED BY THE SERVICER WITH
FORM 10-K............................................................ C-l-1
EXHIBIT C-2 FORM OF CERTIFICATION TO BE PROVIDED TO THE ADMINISTRATOR BY
THE INDENTURE TRUSTEE................................................ C-2-1
EXHIBIT D OFFICER'S CERTIFICATE REGARDING ANNUAL STATEMENT OF
COMPLIANCE........................................................... D-l
EXHIBIT E SERVICING CRITERIA............................................ E-l
This SERVICING AGREEMENT, dated as of April 1, 2007, among Origen Financial
L.L.C., as servicer (the "Servicer"), Origen Servicing, Inc., as subservicer
(the "Subservicer"), Origen Manufactured Housing Contract Trust 2007-A, as
issuing entity (the "Issuing Entity"), and The Bank of New York Trust Company,
N.A., as indenture trustee (the "Indenture Trustee").
WITNESSETH THAT:
WHEREAS, pursuant to the terms of the Asset Purchase Agreement, Origen
Residential Securities, Inc. (the "Depositor"), will acquire the Contracts from
Origen Securitization Company, LLC (the "Seller"), which had previously acquired
the Contracts from Origen Financial L.L.C.
WHEREAS, the Depositor will create Origen Manufactured Housing Contract
Trust 2007-A, a Delaware statutory trust, and will transfer the Contracts and
all of its rights under the Asset Purchase Agreement to the Issuing Entity;
WHEREAS, pursuant to the terms of a Trust Agreement dated as of April 1,
2007 (the "Trust Agreement"), among the Depositor, as depositor, Wilmington
Trust Company, as owner trustee (the "Owner Trustee"), and The Bank of New York
Trust Company, N.A., as certificate registrar and certificate paying agent, the
Depositor will convey the Contracts to the Issuing Entity in exchange for the
Certificates (as defined below);
WHEREAS, pursuant to the terms of the Trust Agreement, the Issuing Entity
will issue and transfer to or at the direction of the Depositor, the Trust
Certificates, 2007-A (the "Certificates");
WHEREAS, pursuant to the terms of an Indenture, dated as of April 1, 2007
(the "Indenture"), between the Issuing Entity and The Bank of New York Trust
Company, N.A., as indenture trustee (the "Indenture Trustee"), the Issuing
Entity will pledge the Contracts and issue
(iii)
and transfer to or at the direction of the Depositor the Origen Manufactured
Housing Contract Trust Notes, Series 2007-A, Class A-1 and Class A-2 Notes
(collectively, the "Notes"); and
WHEREAS, pursuant to the terms of this Servicing Agreement, the Servicer
will be responsible for servicing the Contracts set forth on the List of
Contracts attached hereto as Exhibit A-1, directly or through one or more
subservicers, and the Servicer engages the Subservicer to perform the primary
servicing of the Contracts pursuant to the terms of this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. For all purposes of this Servicing Agreement,
except as otherwise expressly provided herein or unless the context otherwise
requires, capitalized terms not otherwise defined herein shall have the meanings
assigned to such terms in the Definitions contained in Appendix A to the
Indenture which is incorporated by reference herein. All other capitalized terms
used herein shall have the meanings specified herein.
Section 1.02 Other Definitional Provisions.
(a) All terms defined in this Servicing Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
(b) As used in this Servicing Agreement and in any certificate or other
document made or delivered pursuant hereto or thereto, accounting terms not
defined in this Servicing Agreement or in any such certificate or other
document, and accounting terms partly defined in this Servicing Agreement or in
any such certificate or other document, to the extent not defined, shall have
the respective meanings given to them under generally accepted accounting
principles. To the extent that the definitions of accounting terms in this
Servicing Agreement or in any such certificate or other document are
inconsistent with the meanings of such terms under generally accepted accounting
principles, the definitions contained in this Servicing Agreement or in any such
certificate or other document shall control.
(c) The words "hereof," "herein," "hereunder" and words of similar import
when used in this Servicing Agreement shall refer to this Servicing Agreement as
a whole and not to any particular provision of this Servicing Agreement; Section
and Exhibit references contained in this Servicing Agreement are references to
Sections and Exhibits in or to this Servicing Agreement unless otherwise
specified; and the term "including" shall mean "including without limitation".
(d) The definitions contained in this Servicing Agreement are applicable to
the singular as well as the plural forms of such terms and to the masculine as
well as the feminine and neuter genders of such terms.
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(e) Any agreement, instrument or statute defined or referred to herein or
in any instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as from time to time amended, modified or
supplemented and includes (in the case of agreements or instruments) references
to all attachments thereto and instruments incorporated therein; references to a
Person are also to its permitted successors and assigns.
Section 1.03 Interest Calculations. All calculations of interest hereunder
that are made in respect of the Principal Balance of a Contract shall be made on
the basis of a 360-day year consisting of twelve 30-day months, notwithstanding
the terms of the related Contract or Mortgage Note and Mortgage.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
Section 2.01 Covenants, Representations and Warranties Regarding the
Servicer. By its execution and delivery of this Agreement, Origen Financial
L.L.C., as initial Servicer, and Origen Servicing, Inc., as initial Subservicer,
each makes the following representations, warranties and covenants as of the
Closing Date on which the Trust relies in accepting the Contracts and issuing
the Certificates and the Notes and on which the Note Insurer relies on in
executing and delivering the Policy.
(A) Formation and Good Standing. The Servicer is a limited liability
company, and the Subservicer is a corporation, formed, validly existing and
in good standing under the laws of the jurisdiction of its formation and
has the power to own its assets and to transact the business in which it is
currently engaged. Each of the Servicer and the Subservicer is duly
qualified to do business as a foreign limited liability company or
corporation and is in good standing in each jurisdiction in which the
character of the business transacted by it or properties owned or leased by
it requires such qualification and in which the failure so to qualify would
have a material adverse effect on the business, properties, assets, or
condition (financial or other) of the Servicer or the Subservicer, as
applicable.
(B) Authorization: Binding Obligations. Each of the Servicer and the
Subservicer has the power and authority to make, execute, deliver and
perform this Agreement and all of the transactions contemplated under this
Agreement and has taken all necessary corporate action to authorize the
execution, delivery and performance of this Agreement. When executed and
delivered, this Agreement will constitute the legal, valid and binding
obligation of each of the Servicer and the Subservicer enforceable in
accordance with its terms, except as enforcement of such terms maybe
limited by bankruptcy, insolvency or similar laws affecting the enforcement
of creditors' rights generally and by the availability of equitable
remedies.
(C) No Consent Required. Neither the Servicer nor the Subservicer is
required to obtain the consent of any other party or any consent, license,
approval or authorization from, or registration or declaration with, any
governmental authority, bureau or agency in connection with the execution,
delivery, performance, validity or enforceability of this
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Agreement, except for such consents, licenses, approvals and authorizations
as have been obtained.
(D) No Violations. The execution, delivery and performance by the
Servicer and the Subservicer of this Agreement and the fulfillment of its
terms will not violate any provision of any existing law or regulation or
any order or decree of any court or the related Certificate of
Incorporation or Bylaws or other organizational document of the Servicer or
the Subservicer, or constitute a material breach of any mortgage,
indenture, contract or other agreement to which the Servicer or the
Subservicer is a party or by which the Servicer or Subservicer may be
bound.
(E) Litigation. No litigation or administrative proceeding of or
before any court, tribunal or governmental body is currently pending, or to
the knowledge of the Servicer or the Subservicer threatened, against the
Servicer or the Subservicer or any of their respective properties or with
respect to this Agreement or the Notes which, if adversely determined,
would in the opinion of the Servicer or the Subservicer have a material
adverse effect on the transactions contemplated by this Agreement.
(F) Chief Executive Office. The chief executive office of each of the
Servicer and the Subservicer is at ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
(G) No Default. Neither the Servicer nor the Subservicer is in default
with respect to any order or decree of any court or any order, regulation
or demand of any federal, state, municipal or governmental agency, which
default would materially and adversely affect its condition (financial or
other) or operations or its properties or the consequences of which would
materially and adversely affect its performance hereunder. Neither the
Servicer nor the Subservicer is in default under any agreement involving
financial obligations or on any outstanding obligation which would
materially adversely impact its financial condition or operations or legal
documents associated with the transaction contemplated by this Agreement.
(H) No Amendments. Neither the Servicer nor the Subservicer shall
extend or otherwise amend the terms of any Contract, except in accordance
with Section 3.07.
Section 2.02. Existence. The Issuing Entity will keep in full effect its
existence, rights and franchises as a statutory trust under the laws of the
State of Delaware (unless it becomes, or any successor Issuing Entity hereunder
is or becomes, organized under the laws of any other state or of the United
States of America, in which case the Issuing Entity will keep in full effect its
existence, rights and franchises under the laws of such other jurisdiction) and
will obtain and preserve its qualification to do business in each jurisdiction
in which such qualification is or shall be necessary to protect the validity and
enforceability of this Servicing Agreement.
Section 2.03. Enforcement of Representations and Warranties. The Servicer
shall cause the Originator to repurchase a Contract, at its Repurchase Price,
not later than the last day of the month prior to the month that is 60 days
after the day on which the Originator, the Seller, the Servicer, the Note
Insurer or the Indenture Trustee first discovers a breach of a representation or
warranty of the Originator or the Seller set forth in Sections 3.1, 3.2, 3.3,
3.5 or 3.6 of the Asset
4
Purchase Agreement that materially adversely affects the Issuing Entity's, the
Noteholders', the Note Insurer's or the Certificateholders' interest in such
Contract and which breach has not been cured; provided, however, that (i) in the
event that a party other than the Originator first becomes aware of such breach,
such discovering party shall notify the Originator in writing within five
Business Days of the date of such discovery and (ii) with respect to any
Contract incorrectly described on the List of Contracts with respect to unpaid
principal balance, which the Originator would otherwise be required to
repurchase pursuant to this Section, the Servicer may cause the Originator, in
lieu of repurchasing such Contract, to deliver to the Servicer or the
Subservicer for deposit in the Collection Account no later than the first
Determination Date that is 60 or more days from the date of such discovery cash
in an amount sufficient to cure such deficiency or discrepancy. Upon receipt by
the Indenture Trustee of a certificate of a Servicing Officer in the form
attached hereto as Exhibit B, any such cash so deposited shall be distributed to
Noteholders and Certificateholders on the immediately following Payment Date as
a collection of principal on such Contract. Notwithstanding any other provision
of this Agreement, the obligation of the Servicer under this Section to enforce
the Originator's obligations pursuant to the Asset Purchase Agreement shall not
terminate upon a Service Transfer pursuant to Article VI. Notwithstanding the
foregoing, the Servicer shall cause the Originator to repurchase any
Land-and-Home Contract, at such Contract's Repurchase Price, or substitute for
it an Eligible Substitute Asset as described in Section 2.03(b), if the
Originator has failed to deliver the related Land and Home Contract File to the
Custodian within 30 days of the Closing Date, subject to delays in delivery of
recordable documents. Each of the parties to this Agreement acknowledge that the
provisions of this Section 2.03 are an obligation solely of the Servicer and the
Originator and not of any other party to this Agreement. Notwithstanding the
foregoing, in the event that a successor servicer succeeds to the servicing
rights and responsibilities of the Servicer, such successor servicer shall have
no obligation under this Section 2.03 other than to use its commercially
reasonable efforts to request and/or demand the Originator to perform its
obligations under this Section 2.03
ARTICLE III
ADMINISTRATION AND SERVICING OF CONTRACTS
Section 3.01. Responsibility for Contract Administration. The Servicer
shall have the sole obligation to manage, administer, service and make
collections on the Contracts and perform or cause to be performed all
contractual and customary undertakings of the holder of the Contracts to the
Obligor. At the written request of the Servicer, accompanied by the form of
power of attorney or other documents being requested, the Indenture Trustee
shall furnish to the Servicer any powers of attorney and other documents
necessary or appropriate to enable the Servicer to carry out its servicing and
administrative duties hereunder, and the Indenture Trustee shall not be held
responsible for any acts by the Servicer in its uses of any such powers of
attorney or other document. The Servicer shall indemnify the Indenture Trustee
and the Note Insurer for any reasonable costs, liabilities and expenses
(including reasonable attorneys' fees) incurred by the Indenture Trustee or the
Note Insurer in connection with the intentional or negligent misuse of such
power of attorney by the Servicer, as applicable. Notwithstanding anything
contained herein to the contrary, the Servicer shall not without the Indenture
Trustee's written consent (i) initiate any action, suit or proceeding solely
under the Indenture Trustee's name without indicating the Servicer's
representative capacity or (ii) knowingly cause the
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Indenture Trustee to be registered to do business in any state, provided,
however, that the preceding clause (i) shall not apply to the initiation of
actions relating to Contracts that the Servicer is servicing pursuant to its
respective duties herein. The limitations of the preceding clause shall not be
construed to limit any duty or obligation imposed on the Indenture Trustee under
any other provision of this Agreement.
Origen Financial L.L.C. is hereby appointed the Servicer until such time as
any Service Transfer shall be effected under Article VI.
Section 3.02. Standard of Care. In managing, administering, servicing and
making collections on the Contracts pursuant to this Agreement, the Servicer
shall exercise that degree of skill and care consistent with the same degree of
skill and care that the Servicer exercises with respect to similar contracts
serviced by the Servicer; provided, however, that (i) such degree of skill and
care shall be at least as favorable as the degree of skill and care generally
applied by servicers of manufactured housing installment sales contracts for
institutional investors and (ii) notwithstanding the foregoing, the Servicer
shall not release or waive the right to collect the unpaid balance on any
Contract unless it makes the determination that acceptance of the liquidation
proceeds from the related Obligor would result in the Trust receiving a greater
amount of collections than the Net Liquidation Proceeds that would result from
repossessing or foreclosing and liquidating the related Manufactured Home.
Section 3.03. Records. The Servicer shall, during the period it is servicer
hereunder, maintain such books of account and other records as will enable the
Indenture Trustee to determine the status of each Contract.
Section 3.04. Inspection: Electronic File.
(a) At all times during the term hereof, the Servicer shall afford the Note
Insurer and the Indenture Trustee and its authorized agents reasonable access
during normal business hours to the Servicer's records, which have not
previously been provided to the Trust, relating to the Contracts and will cause
its personnel to assist in any examination of such records by the Note Insurer
and the Indenture Trustee or its authorized agents. The examination referred to
in this Section will be conducted in a manner which does not unreasonably
interfere with the Servicer's normal operations or customer or employee
relations. Without otherwise limiting the scope of the examination the Indenture
Trustee or the Note Insurer may make, the Indenture Trustee or the Note Insurer
may, using generally accepted audit procedures, verify the status of each
Contract and review the Electronic Ledger and records relating thereto for
conformity to Monthly Reports prepared pursuant to Section 3.26 of the Indenture
and compliance with the standards represented to exist as to each Contract in
this Agreement.
(b) At all times during the term hereof, the Servicer shall keep available
a copy of the List of Contracts at its principal executive office for inspection
by the Note Insurer, Noteholders and Certificateholders.
(c) On or before the fourth Business Day prior to each Payment Date, the
Servicer shall determine the Amount Available for such Payment Date to be
remitted to the Note Payment Account and shall provide to the Indenture Trustee
and the Note Insurer an electronic file (the
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"Electronic File") setting forth such amount and any other information necessary
for the Indenture Trustee to perform the calculations required hereunder and
under the Indenture and prepare the Monthly Report. The Indenture Trustee will
be entitled to rely on information supplied by the Servicer without independent
verification.
Section 3.05. Collection Account.
(a) On or before the Closing Date, the Servicer shall establish the
Collection Account with The Bank of New York Trust Company, N.A., which must be
an Eligible Account. The Collection Account shall be entitled "Origen Servicing
for the benefit of The Bank of New York Trust Company, N.A., as Indenture
Trustee for the benefit of holders of Origen Manufactured Housing Contract Trust
Collateralized Notes, Series 2007-A and Ambac Assurance Corporation." The
Servicer shall pay into the Collection Account as promptly as practicable (not
later than the second Business Day) following receipt thereof:
(i) all payments received after the Cut-off Date on account of
principal on the Contracts and all Principal Prepayments collected after the
Cut-off Date;
(ii) all payments received after the Cut-off Date on account of
interest on the Contracts;
(iii) all Net Liquidation Proceeds;
(iv) all Insurance Proceeds unless to be used to directly offset the
cost of repairing the related property;
(v) any amounts payable in connection with the repurchase of any
Contract pursuant to Section 2.03 hereof or Section 3.7 of the Asset Purchase
Agreement; and
(vi) any other amount required to be deposited in the Collection
Account pursuant to this Agreement;
provided, however, that with respect to each Due Period, the Servicer shall be
permitted to retain the Monthly Servicing Fee for the related Payment Date from
payments in respect of interest on the Contracts in accordance with Section 3.06
hereof. The foregoing requirements respecting deposits to the Collection Account
are exclusive, it being understood that, without limiting the generality of the
foregoing, the Servicer need not deposit in the Collection Account amounts
representing late payment fees, assumption fees, extension fees or escrow
deposits payable by Obligors, which amounts shall be property of the Servicer.
The Servicer agrees that all amounts paid into the Collection Account under this
Agreement shall be held in trust for the Indenture Trustee, the Noteholders, the
Note Insurer and the Certificateholders until payment or withdrawal of any such
amounts is authorized under this Agreement.
If the Servicer so directs, the institution maintaining the Collection
Account shall, in the name of the Indenture Trustee in its capacity as such,
invest the amounts in the Collection Account in Permitted Investments that
mature not later than one Business Day prior to the next succeeding Payment
Date. All income and gain from such investments shall be payable to the
Servicer. An amount equal to any net loss on such investments shall be deposited
in the
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Collection Account by the Servicer out of its own funds immediately as realized;
provided that if a successor servicer succeeds to the servicing rights and
responsibilities of the Servicer, such successor servicer shall have no
obligation or responsibility for any losses occasioned by or arising from the
prior Servicer's investments. Neither the Note Insurer nor the Indenture Trustee
shall in any way be responsible or liable for losses on amounts invested in
accordance with the provisions hereof. Funds in the Collection Account not so
invested must be insured to the extent of the maximum amount insurable by the
Federal Deposit Insurance Corporation.
If the Servicer so directs, the institution maintaining the Note
Payment Account shall, in the name of the Indenture Trustee in its capacity as
such, invest the amounts in the Note Payment Account in Permitted Investments
that mature not later than one Business Day prior to the next succeeding Payment
Date. All income and gain from such investments shall be payable to the
Servicer. An amount equal to any net loss on such investments shall be deposited
in the Note Payment Account by the Servicer out of its own funds immediately as
realized; provided that if a successor servicer succeeds to the servicing rights
and responsibilities of the Servicer, such successor servicer shall have no
obligation or responsibility for any losses occasioned by or arising from the
prior Servicer's investments. The Indenture Trustee shall in no way be
responsible or liable for losses on amounts invested in accordance with the
provisions hereof. Funds in the Note Payment Account not so invested must be
insured to the extent of the maximum amount insurable by the Federal Deposit
Insurance Corporation.
(b) If at anytime the Servicer receives notice (from each Rating Agency,
the Indenture Trustee or otherwise) that the Collection Account has ceased to be
an Eligible Account, the Servicer must, as soon as practicable but in no event
later than 5 Business Days of the Servicer's receipt of such notice, transfer
the Collection Account and all funds and Permitted Investments therein to an
Eligible Account. Following any such transfer, the Servicer must notify each
Rating Agency, the Note Insurer and the Indenture Trustee of the location of the
Collection Account.
Section 3.06. Permitted Withdrawals. The Servicer may, from time to time as
provided herein, make withdrawals from the Collection Account of amounts
deposited in said account pursuant to Section 3.05 that are attributable to the
Contracts for the following purposes:
(a) to remit the Amount Available to the Indenture Trustee for deposit in
the Note Payment Account to make payments in the amounts and in the manner
provided for in Section 8.02 of the Indenture;
(b) to pay to the Originator with respect to each Contract or property
acquired in respect thereof that has been repurchased or replaced pursuant to
Section 2.03 hereof or Section 3.7 of the Asset Purchase Agreement, all amounts
received thereon and not required to be distributed to Noteholders or
Certificateholders as of the date on which the related Principal Balance or
Repurchase Price is determined;
(c) to reimburse the Servicer out of Liquidation Proceeds for Liquidation
Expenses incurred by it, to the extent such reimbursement is permitted pursuant
to Section 3.09, and to reimburse the Servicer as provided in Sections 3.08,
3.11, 3.13 and 6.02;
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(d) to withdraw any amount deposited in the Collection Account that was not
required to be deposited therein;
(e) to make any rebates or adjustments deemed necessary by the Servicer
pursuant to Section 3.07(d); or
(f) to reimburse the Servicer (1) for any accrued unpaid Monthly Servicing
Fees and (2) for unreimbursed Servicing Advances, including Nonrecoverable
Advances, to the extent not otherwise retained. The Servicer's right to
reimbursement for Servicing Advances that are not Nonrecoverable Advances shall
be limited to late collections on the related Contract, including Liquidation
Proceeds, Insurance Proceeds and such other amounts as maybe collected by the
Servicer from the related Obligor or otherwise relating to the Contract in
respect of which such reimbursed amounts are owed. Except with respect to
Nonrecoverable Advances, the Servicer's right to reimbursement for unreimbursed
Servicing Advances shall be limited to late collections of interest on any
Contract and to Liquidation Proceeds and Insurance Proceeds on related Obligors.
In addition, expenses incurred by the Servicer in connection with a defaulted
Contract which is subsequently reinstated, worked out or cured, shall be
reimbursable to the Servicer as a Nonrecoverable Advance at the time of the
cure.
Since, in connection with withdrawals pursuant to clause (b), the
Originator's entitlement thereto is limited to collections or other recoveries
on the related Contract, the Servicer shall keep and maintain separate
accounting, on a Contract by Contract basis, for the purpose of justifying any
withdrawal from the Collection Account pursuant to such clause.
Three Business Days before each Payment Date, no later than 1:00 p.m.
New York time, the Indenture Trustee shall notify the Servicer of the Interest
Deficiency Remedy Amount, if any, payable on the Notes for such Payment Date.
Two Business Days before each Payment Date, no later than 1:00 p.m. New York
time, the Servicer shall remit to the Indenture Trustee for deposit into the
Note Payment Account (i) the Amount Available and (ii) from Amounts Held for
Future Distribution, the Interest Deficiency Remedy Amount for such Payment
Date.
Section 3.07. Enforcement.
(a) The Servicer shall, consistent with customary servicing procedures and
the terms of this Agreement, act with respect to the Contracts in such manner
as, in the Servicer's reasonable judgment, will maximize the receipt of
principal and interest on such Contracts and Liquidation Proceeds with respect
to Liquidated Contracts.
(b) The Servicer may ▇▇▇ to enforce, initiate a replevin action, or collect
upon Contracts, in its own name, if possible, or as agent for the Trust.
(c) The Servicer shall exercise any rights of recourse against third
persons that exist with respect to any Contract in accordance with the
Servicer's usual practice. In exercising recourse rights, the Servicer is
authorized on the Issuing Entity's and the Indenture Trustee's behalf to
reassign the Contract or to resell the related Manufactured Home to the Person
against whom recourse exists at the price set forth in the document creating the
recourse.
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(d) The Servicer may grant to the Obligor on any Contract any rebate,
refund or adjustment out of the Collection Account that the Servicer in good
faith believes is required because of prepayment in full of the Contract. The
Servicer will not permit any rescission or cancellation of any Contract, except
as required by applicable law or regulation or upon the order of any court or
other governmental authority asserting jurisdiction in a suit, claim or
complaint involving the Contract.
(e) (i) The Servicer may, consistent with its customary servicing
procedures and consistent with Section 3.02, grant to the Obligor on any
Contract an extension of payments due under such Contract; provided that, no
such extension may extend beyond the final scheduled payment date of the
Contract with the latest maturity, and no more than three extensions for any one
Contract of payments under a Contract may be granted in any twelve-month period.
Notwithstanding the foregoing, in connection with a Contract that is in default
or for which default is imminent, the Servicer may, consistent with the
servicing standard described in Section 3.01, waive, modify or vary any term of
that Contract (including modifications that change the Contract Rate, forgive
the payment of principal or interest or extend the final maturity date of that
Contract), accept payment from the related Obligor of an amount less than the
Principal Balance in final satisfaction of that Contract, or consent to the
postponement of strict compliance with any such term or otherwise grant the
indulgence to any Obligor if in the Servicer's determination such waiver,
modification, postponement or indulgence is not materially adverse to the
interests of the Noteholders (taking into account any estimated loss that might
result absent such action). However, the Servicer shall not extend the maturity
of any Contract past the date on which the final payment is due on the latest
maturing Contract as of the related Cut-off Date.
(ii) The Servicer's rights pursuant to Section 3.07(e)(i) shall be limited
as set forth below in any month in which a Rolling Average Extension Trigger
Event, an Aggregate Long-Term Extension Trigger Event or an Aggregate Rate
Modification Trigger Event exists. For any month in which a Rolling Average
Trigger Event exists, the Servicer shall notify the Note Insurer two (2)
Business Days prior to any proposed Extension with respect to a Contract during
such month (not including any Extension in response to a natural disaster). If
the Note Insurer does not object to such Extension in writing within two (2)
Business Days of receipt of such notice, then the proposed Extension shall be
deemed to have been accepted by the Note Insurer. For any month in which an
Aggregate Long-Term Extension Trigger Event exists, the Servicer shall notify
the Note Insurer two (2) Business Days prior to any proposed Long-Term Extension
with respect to a Contract during such month. If the Note Insurer does not
object to such Long-Term Extension in writing within two (2) Business Days of
receipt of such notice, then the proposed Long-Term Extension shall be deemed to
have been accepted by the Note Insurer. For any month in which an Aggregate Rate
Modification Trigger Event exists, the Servicer shall notify the Note Insurer
two (2) Business Days prior to any proposed Rate Modification with respect to a
Contract during such month. If the Note Insurer does not object to such Rate
Modification in writing within two (2) Business Days of receipt of such notice,
then the proposed Rate Modification shall be deemed to have been accepted by the
Note Insurer.
(f) The Servicer may enforce any due-on-sale clause in a Contract if such
enforcement is called for under its then current servicing policies for
obligations similar to the Contracts; provided that such enforcement is
permitted by applicable law and will not adversely affect any applicable
insurance policy. If an assumption of a Contract is permitted by the
10
Servicer upon conveyance of the related Manufactured Home, the Servicer shall
use its best efforts to obtain an assumption agreement in connection therewith
and add such assumption agreement to the related Contract File or Land and Home
Contract File.
Section 3.08. Indenture Trustee to Cooperate.
(a) Upon payment in full of any Contract, the Servicer shall notify the
Indenture Trustee, the Note Insurer, the Originator and the Seller on the next
succeeding Payment Date by certification of a Servicing Officer (which
certification shall include a statement to the effect that all amounts received
in connection with such payments which are required to be deposited in the
Collection Account pursuant to Section 3.05 have been so deposited). The
Servicer is authorized to execute an instrument in satisfaction of such Contract
and to do such other acts and execute such other documents as the Servicer deems
necessary to discharge the Obligor thereunder and eliminate the lien on the
related real estate and collateral. The Servicer shall determine when a Contract
has been paid in full; to the extent that insufficient payments are received on
a Contract but are otherwise incorrectly credited by the Servicer as prepaid or
paid in full and satisfied, the shortfall shall be paid by the Servicer out of
its own funds; provided that the Servicer may reimburse itself for such
shortfall payment from the Collection Account if the Servicer corrects the error
and receives amounts in respect of such shortfall payment from future
collections with respect to such Contract.
(b) From time to time as appropriate for servicing and foreclosure in
connection with any Land-and-Home Contract, the Indenture Trustee shall, upon
written request of a Servicing Officer and delivery to the Indenture Trustee of
a receipt signed by such Servicing Officer, at the expense of the Servicer,
cause the original Land-and-Home Contract and the related Land-and-Home Contract
File to be released to the Servicer and shall execute such documents as the
Servicer shall deem necessary to the prosecution of any such proceedings. The
Indenture Trustee shall stamp the face of each such Land-and-Home Contract to be
released to the Servicer with a notation that the Land-and-Home Contract has
been assigned to the Indenture Trustee. Upon request of a Servicing Officer, the
Indenture Trustee shall perform such other acts as reasonably requested by the
Servicer and otherwise cooperate with the Servicer in enforcement of the Note
Insurer, the Noteholders' and the Certificateholders' rights and remedies with
respect to Contracts. The Indenture Trustee shall not be liable for the
performance of any such acts at the request of the Servicer.
(c) The Servicer's receipt of a Land-and-Home Contract and/or Land-and-Home
Contract File shall obligate the Servicer to return the original Land-and-Home
Contract and the related Land-and-Home Contract File to the Indenture Trustee
when its need by the Servicer has ceased unless the Asset shall be liquidated or
repurchased or replaced as described in Section 2.03.
Section 3.09. Costs and Expenses. All costs and expenses incurred by the
Servicer in carrying out its duties hereunder, including all fees and expenses
incurred in connection with the enforcement of Contracts (including enforcement
of defaulted Contracts and repossessions of Manufactured Homes securing such
Contracts) shall be paid by the Servicer and the Servicer shall not be entitled
to reimbursement hereunder, except to the extent specifically provided herein.
Furthermore, the Servicer shall be reimbursed out of the Liquidation Proceeds of
a
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Liquidated Contract for Liquidation Expenses incurred by it and if such
Liquidation Expenses are deemed Nonrecoverable Advances, the Servicer may
reimburse itself as provided in Section 3.06(f). The Servicer shall not incur
such Liquidation Expenses unless it determines in its good faith business
judgment that incurring such expenses will increase the Net Liquidation Proceeds
on the related Contract.
Section 3.10. Maintenance of Insurance.
(a) Except as otherwise provided in subsection (b) of this Section 3.10,
the Servicer shall cause to be maintained with respect to each Contract one or
more Hazard Insurance Policies which provide, at a minimum, the same coverage as
a standard form fire and extended coverage insurance policy that is customary
for manufactured housing, issued by a company authorized to issue such policies
in the state in which the related Manufactured Home is located and in an amount
which is not less than the maximum insurable value of such Manufactured Home or
the principal balance due from the Obligor on the related Contract, whichever is
less; provided, however, that the amount of coverage provided by each Hazard
Insurance Policy shall be sufficient to avoid the application of any
co-insurance clause contained therein; and provided, further, that such Hazard
Insurance Policies may provide for customary deductible amounts. With respect to
any Contract, the Servicer shall cause the Originator to obtain (i) a statement
from the Obligor's insurance agent or through other information sources that the
Manufactured Home was, at the time of origination of the Contract, not in a
federally designated special flood hazard area, or (ii) evidence that, at the
time of origination, flood insurance was in effect, which coverage was at least
equal to the minimum amount specified in the preceding sentence or such lesser
amount as may be available under the federal flood insurance program. Each
Hazard Insurance Policy caused to be maintained by the Servicer shall contain a
standard loss payee clause in favor of the Servicer and its successors and
assigns. If any Obligor is in default in the payment of premiums on its Hazard
Insurance Policy or Policies, the Servicer shall force place coverage and pay
such premiums out of its own funds and may separately add such premium to the
Obligor's obligation as provided by the Contract, but shall not add such premium
to the remaining principal balance of the Contract. If the Obligor does not
reimburse the Servicer for payment of such premiums and the related Contract is
liquidated after a default, the Servicer shall be reimbursed for its payment of
such premiums out of the related Liquidation Proceeds, and if such advance for
insurance premiums is deemed by the Servicer to be nonrecoverable in its
reasonable opinion, the Servicer may reimburse itself from the Collection
Account for such Nonrecoverable Advance.
(b) The Servicer may, in lieu of causing individual Hazard Insurance
Policies to be maintained with respect to each Manufactured Home pursuant to
subsection (a) of this Section 3.10, and shall, to the extent that the related
Contract does not require the Obligor to maintain a Hazard Insurance Policy with
respect to the related Manufactured Home, maintain one or more blanket insurance
policies covering losses on the Obligor's interest in the Contracts resulting
from the absence or insufficiency of individual Hazard Insurance Policies. Any
such blanket policy shall be substantially in the form and in the amount carried
by the Servicer as of the date of this Agreement. The Servicer shall pay the
premium for such policy on the basis described therein and shall deposit into
the Collection Account from its own funds any deductible amount with respect to
claims
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under such blanket insurance policy relating to the Contracts. The Servicer
shall not, however, be required to deposit any deductible amount with respect to
claims under individual Hazard Insurance Policies maintained pursuant to
subsection (a) of this Section. If the insurer under such blanket insurance
policy shall cease to be acceptable to the Servicer, the Servicer shall exercise
its best reasonable efforts to obtain from another insurer a replacement policy
comparable to such policy.
(c) With respect to each Manufactured Home that has been repossessed in
connection with a defaulted Contract, the Servicer shall either (i) maintain one
or more Hazard Insurance Policies thereon or (ii) self-insure such Manufactured
Homes and deposit into the Collection Account from its own funds any losses
caused by damage to such Manufactured Home that would have been covered by a
Hazard Insurance Policy.
(d) The Servicer shall keep in force throughout the term of this Agreement
(i) a policy or policies of insurance covering errors and omissions for failure
to maintain insurance as required by this Agreement and (ii) a fidelity bond.
Such policy or policies and such fidelity bond shall be in such form and amount
as is generally customary among Persons which service a portfolio of
manufactured housing installment sales contracts and installment loan agreements
having an aggregate principal amount of $100,000,000 or more and which are
generally regarded as servicers acceptable to institutional investors.
Section 3.11. Repossession. Consistently with the standard of care
specified in Section 3.02, the Servicer shall commence procedures for the
repossession of any Manufactured Home or the foreclosure upon any Mortgaged
Property or take such other steps that in the Servicer's reasonable judgment
will maximize the receipt of principal and interest or Net Liquidation Proceeds
with respect to a delinquent Contract secured by such Manufactured Home or
Mortgaged Property (which may include retitling or filing a recorded assignment
of the Mortgage) subject to the requirements of the applicable state and federal
law. Notwithstanding the standard of care specified in Section 3.02, the
Servicer shall commence procedures for the repossession of any Manufactured Home
or the foreclosure upon any Mortgaged Property with respect to a Contract, and
to liquidate such Manufactured Home or Mortgaged Property, as soon as
commercially reasonably practicable after the time when such Contract becomes a
Charged off Contract (or sooner in the Servicer's reasonable judgment).
Notwithstanding the foregoing provisions of this Section 3.11 or any other
provision of this Agreement, with respect to any Contract as to which the
Servicer has received actual notice of, or has actual knowledge of, the presence
of any toxic or hazardous substance on the related Mortgaged Property, the
Servicer shall not, on behalf of the Indenture Trustee, either (i) obtain title
to such Mortgaged Property as a result of or in lieu of foreclosure or otherwise
or (ii) otherwise acquire possession of, or take any other action with respect
to, such Mortgaged Property, if, as a result of any such action, the Indenture
Trustee, the Trust Estate, the Note Insurer or the Noteholders would be
considered to hold title to, to be a "mortgagee-in-possession" of, or to be an
"owner" or "operator" of such Mortgaged Property within the meaning of the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended from time to time, or any comparable law, unless the Servicer has also
previously determined, based on its reasonable judgment and a report prepared by
a Person who regularly conducts environmental audits using customary industry
standards, that:
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(1) such Mortgaged Property is in compliance with applicable
environmental laws or, if not, that it would be in the best
economic interest of the and the Note Insurer to take such
actions as are necessary to bring the Mortgaged Property into
compliance therewith; and
(2) there are no circumstances present at such Mortgaged
Property relating to the use, management or disposal of any
hazardous substances, hazardous materials, hazardous wastes, or
petroleum-based materials for which investigation, testing,
monitoring, containment, clean-up or remediation could be
required under any federal, state or local law or regulation, or
that if any such materials are present for which such action
could be required, that it would be in the best economic interest
of the Noteholders and the Note Insurer to take such actions with
respect to the affected Mortgaged Property.
The cost of the environmental audit report contemplated by this
Section 3.11 shall be advanced by the Servicer as Servicing Advances, subject to
the Servicer's right to be reimbursed therefor from the Collection Account as
provided in Section 3.06(c) or 3.06(f), as appropriate, such right of
reimbursement being prior to the rights of Noteholders to receive any amount in
the Collection Account received in respect of the affected Contract or other
Contracts.
If the Servicer determines, as described above, that it is in the best
economic interest of the Noteholders and the Note Insurer to take such actions
as are necessary to bring any such Mortgaged Property into compliance with
applicable environmental laws, or to take such action with respect to the
containment, clean-up or remediation of hazardous substances, hazardous
materials, hazardous wastes or petroleum-based materials affecting any such
Mortgaged Property, then the Servicer shall take such action as it deems to be
in the best economic interest of the Noteholders and the Note Insurer; provided,
however, that the Servicer shall not proceed with foreclosure or acceptance of a
deed in lieu of foreclosure if the estimated costs of the environmental clean
up, as estimated in the environmental audit report, together with the Servicing
Advances made by the Servicer and the estimated costs of foreclosure or
acceptance of a deed in lieu of foreclosure exceeds the estimated value of the
Mortgaged Property. The cost of any such compliance, containment, cleanup or
remediation shall be advanced by the Servicer, subject to the Servicer's right
to be reimbursed therefor from the Collection Account as provided in Section
3.06(c) or 3.06(f), as appropriate, such right of reimbursement being prior to
the rights of Noteholders to receive any amount in the Collection Account
received in respect of the affected Contract or other Contracts.
In connection with such foreclosure or other conversion, the Servicer
shall follow such practices and procedures as it shall deem necessary or
advisable and as shall be consistent with Section 3.02. In the event that title
to any Mortgaged Property is acquired in foreclosure or by deed in lieu of
foreclosure, the deed or certificate of sale shall be issued to the Indenture
Trustee, as Indenture Trustee, or, at its election, to its nominee on behalf of
the Indenture Trustee, as Indenture Trustee.
Section 3.12. Subservicing Arrangements. The Servicer may arrange for the
subservicing of any Contract by a Subservicer pursuant to a subservicing
agreement; provided,
14
however, that such subservicing arrangement and the terms of the related
subservicing agreement must provide for the servicing of such Contracts in a
manner consistent with the servicing arrangements contemplated hereunder. Unless
the context otherwise requires, references in this Agreement to actions taken or
to be taken by the Servicer in servicing the Contracts include actions taken or
to be taken by a subservicer on behalf of the Servicer. Notwithstanding the
provisions of any subservicing agreement, any of the provisions of this
Agreement relating to agreements or arrangements between the Servicer and a
subservicer or reference to actions taken through a subservicer or otherwise,
the Servicer shall remain obligated and liable to the Issuing Entity, the
Indenture Trustee, the Originator, the Seller, the Note Insurer, the Noteholders
and the Certificateholders for the servicing and administration of the Contracts
in accordance with the provisions of this Agreement without diminution of such
obligation or liability by virtue of such subservicing agreements or
arrangements or by virtue of indemnification from the subservicer and to the
same extent and under the same terms and conditions as if the Servicer alone
were servicing and administering the Contracts. All actions of each subservicer
performed pursuant to the related subservicing agreement shall be performed as
an agent of the Servicer with the same force and effect as if performed directly
by the Servicer. The Servicer hereby appoints Origen Servicing, Inc., as its
subservicer. Origen Servicing, Inc. accepts the appointment as subservicer and
agrees to service the Contracts in accordance with the terms of this Agreement.
The Subservicer shall be entitled to retain from collections on the Contracts
pursuant to Section 3.06(f), a subservicing fee equal to the portion of the
Monthly Servicing Fee calculated at 1.00% per annum, and shall remit all
servicing compensation in excess of such amount to the Servicer. Origen
Servicing, Inc. is hereby deemed an acceptable Subservicer for purposes of this
Agreement.
All references to the Servicer in this Agreement shall be deemed to
include reference to the Subservicer and the parties to this Agreement shall
deal directly with the Subservicer rather than the Servicer. Notwithstanding the
foregoing, the parties hereto may and shall be entitled to rely on direction
provided by either the Servicer or the Subservicer.
For purposes of this Agreement, the Servicer shall be deemed to have
received any collections, recoveries or payments with respect to the Contracts
that are received by a Subservicer regardless of whether such payments are
remitted by the Subservicer to the Servicer.
Section 3.13. Retitling; Security Interests.
(a) If, at any time, a Service Transfer has occurred and the new Servicer
is unable to repossess or foreclose upon a Manufactured Home because the title
document for such Manufactured Home does not show such Servicer or the Indenture
Trustee as the holder of the first priority security interest in the
Manufactured Home, such Servicer shall take all necessary steps to apply for a
replacement title document showing it or the Indenture Trustee as the secured
party; provided that the new Servicer shall be reimbursed by the Trust for all
reasonable expenses in connection with its responsibilities under this Section
3.13.
(b) In order to facilitate the Servicer's actions, as described in
subsection (a) of this section, Origen Servicing, Inc. will provide the
Servicer, and the Servicer will provide the Indenture Trustee, with any
necessary power of attorney permitting it to retitle the Manufactured Home.
15
(c) If the Servicer is still unable to retitle the Manufactured Home,
Origen Servicing, Inc. will take all actions necessary to act with the Servicer
to initiate replevin action upon the Manufactured Home, including, as
appropriate, the filing of any UCC-1 or UCC-2 financing statements necessary to
perfect the security interest in any Manufactured Home that constitutes a
fixture under the laws of the jurisdiction in which it is located and all
actions necessary to perfect the security interest in any Manufactured Home that
is considered or classified as part of the real estate on which it is located
under the laws of the jurisdiction in which it is located.
Section 3.14. Payment of Taxes. If the Servicer becomes aware of the
nonpayment by an Obligor of a real or personal property tax or other tax or
charge which may result in a lien upon a Manufactured Home or Mortgaged Property
prior to, or equal to or coordinate with, the lien of the related Contract, the
Servicer, consistent with Section 3.02, shall advance, but only to the extent
that the Servicer deems, in its sole judgment, such advance recoverable, such
taxes or charges to avoid the attachment of any such lien. If the Servicer shall
have paid any such real or personal property tax or other tax or charge directly
on behalf of an Obligor, the Servicer may separately add such amount to the
Obligor's obligation as provided by the Contract, but, for the purposes of this
Agreement, may not add such amount to the remaining principal balance of the
Contract. If the Servicer shall have repossessed a Manufactured Home or
Mortgaged Property on behalf of the Noteholders, the Certificateholders, the
Note Insurer and the Indenture Trustee, the Servicer shall advance, but only to
the extent that the Servicer, in its sole judgment, deems such advance
recoverable, the amount of any such tax or charge arising during the time such
Manufactured Home is in the Servicer's possession or title to the Mortgaged
Property is in the name of the Servicer (or any Person acting on behalf of the
Servicer), unless the Servicer is contesting in good faith such tax or charge or
the validity of the claimed lien on such Manufactured Home or Mortgaged
Property. If the Obligor does not reimburse the Servicer for payment of such
taxes or charges pursuant to this Section 3.14 and the related Contract is
liquidated after a default, the Servicer shall be reimbursed for its payment of
such taxes or charges out of the related Liquidation Proceeds. If Liquidation
Proceeds are insufficient to reimburse the Servicer for any such premiums, the
amount of such insufficiency shall constitute, and be reimbursable to the
Servicer as, a Nonrecoverable Advance.
Section 3.15. Annual Statement as to Compliance.
Not later than March 15th of each calendar year commencing in 2008,
the Servicer will deliver to the Indenture Trustee and the Depositor (with a
copy to the Note Insurer) an Officers' Certificate (upon which the Indenture
Trustee can conclusively rely in connection with its obligations under Section
7.05 of the Indenture) substantially in the form of Exhibit D attached hereto
stating, as to each signatory thereof, that (i) a review of the activities of
the Servicer and the Subservicer during the preceding calendar year and of
performance under this Servicing Agreement has been made under such officer's
supervision and (ii) to the best of such officer's knowledge, based on such
review, each of the Servicer and the Subservicer has fulfilled all of its
obligations in all material respects under this Servicing Agreement throughout
such year, or, if there has been a failure to fulfill any such obligation in any
material respect, specifying each such failure known to such officer and the
nature and status thereof. Copies of any such statement shall be provided by the
Indenture Trustee to any Noteholder and to any Person identified to the
Indenture Trustee as a prospective transferee of a Note, upon request at
16
the expense of the requesting party, provided such statement is delivered by the
Servicer to the Indenture Trustee.
Section 3.16. Annual Assessment and Attestation.
(a) Not later than March 15th of each calendar year, commencing in March
2008, the Servicer shall furnish or otherwise make available to the Indenture
Trustee and the Depositor (with a copy to the Note Insurer), a report on an
assessment of compliance with the Servicing Criteria that contains (A) a
statement by the Servicer of its responsibility for assessing compliance with
the Servicing Criteria, (B) a statement that the Servicer used the Servicing
Criteria to assess compliance with the Servicing Criteria, (C) the Servicer's
assessment of compliance with the Servicing Criteria as of and for the fiscal
year covered by the Form 10-K required to be filed pursuant to Section 8.05,
including, if there has been any material instance of noncompliance with the
Servicing Criteria, a discussion of each such failure and the nature and status
thereof, and (D) a statement that a registered public accounting firm has issued
an attestation report on the Servicer's assessment of compliance with the
Servicing Criteria as of and for the period ending the end of the fiscal year
covered by the 10-K report.
Not later than March 15th of each calendar year for so long as the Issuing
Entity is subject to the Exchange Act reporting requirements, commencing in
March 2008, the Indenture Trustee shall furnish or otherwise make available to
the Servicer and the Depositor (with a copy to the Note Insurer), a report on an
assessment of compliance with the Servicing Criteria that contains (A) a
statement by the Indenture Trustee of its responsibility for assessing
compliance with the Servicing Criteria applicable to it, (B) a statement that
the Indenture Trustee used the Servicing Criteria applicable to it to assess
such compliance, (C) the Indenture Trustee's assessment of compliance with the
Servicing Criteria applicable to it as of and for the fiscal year covered by the
Form 10-K required to be filed pursuant to Section 8.05, including, if there has
been any material instance of noncompliance with the Servicing Criteria, and (D)
a statement that a registered public accounting firm has issued an attestation
report on the Indenture Trustee's assessment of compliance with the Servicing
Criteria applicable to it as of and for the period ending the end of the fiscal
year covered by the 10-K report.
(b) Not later than March 15th of each calendar year, commencing in March
2008, the Servicer shall cause a registered public accounting firm (which may
also render other services to the Subservicer, the Servicer, the Indenture
Trustee, as the case may be) and that is a member of the American Institute of
Certified Public Accountants to furnish an attestation report to the Depositor
(with a copy to the Note Insurer), to the effect that (i) it has obtained a
representation regarding certain matters from the management of such party,
which includes an assertion that such party has complied with the Servicing
Criteria, and (ii) on the basis of an examination conducted by such firm in
accordance with standards for attestation engagements issued or adopted by the
PCAOB, it is expressing an opinion as to whether such party's compliance with
the Servicing Criteria was fairly stated in all material respects. Such report
must be available for general use and not contain restricted use language.
Not later than March 15th of each calendar year, commencing in March 2008,
the Indenture Trustee shall cause a registered public accounting firm (which may
also render other services to the Subservicer, the Servicer or the Depositor, as
the case may be) and that is a
17
member of the American Institute of Certified Public Accountants to furnish an
attestation report to the Depositor (with a copy to the Note Insurer), to the
effect that (i) it has obtained a representation regarding certain matters from
the Indenture Trustee, which includes an assertion that the Indenture Trustee
has complied with the Servicing Criteria applicable to it, and (ii) on the basis
of an examination conducted by such firm in accordance with standards for
attestation engagements issued or adopted by the PCAOB, it is expressing an
opinion as to whether such party's compliance with the Servicing Criteria was
fairly stated in all material respects. Such report must be available for
general use and not contain restricted use language.
Section 3.17. Optional Redemption.
(a) The Servicer shall have the option to purchase all outstanding
Contracts on any Payment Date on or after the Payment Date (with the consent of
the Note Insurer if such purchase would result in a claim on the Policy or would
result in any amount owing to the Note Insurer under the Insurance Agreement
remaining unpaid) on which the Pool Principal Balance is less than or equal to
20% of the Cut-off Date Pool Balance. The aggregate redemption price for the
Contracts will be equal to the greatest of (a) the sum of: (i) 100% of the
Principal Balance of each Contract, other than any Contract as to which the
related Manufactured Home has been repossessed and whose fair market value is
included in clause (ii) hereof, and (ii) the fair market value of any acquired
property, as determined by the Servicer, (b) the aggregate fair market value of
all assets of the Trust Estate (as determined by the Servicer), in each case
plus any unpaid Interest Payment Amounts on each Class of Notes and all amounts
owed to the Note Insurer, the Indenture Trustee, the Custodian and the Swap
Provider at such time; and (c) the unpaid Outstanding Principal Balance of the
Notes and all unpaid interest on the Notes, including Available Funds Cap
Carry-Forward Amounts (the "Redemption Price"). If the determination of the fair
market value of the Contracts shall be required to be made by the Servicer as
provided above, (A) such appraisal shall be obtained at no expense to the
Indenture Trustee and (B) the Indenture Trustee may conclusively rely on, and
shall be protected in relying on, such appraisal.
The Redemption Price deposited by the Servicer will be paid to all
outstanding Noteholders on the Payment Date occurring in the month following the
date of redemption. The Servicer must give the Indenture Trustee, the Auction
Agent and DTC at least 30 days' prior notice of its intent to exercise this
option. No optional redemption may be effected unless all amounts due and unpaid
to the Note Insurer, the Indenture Trustee, the Custodian and the Swap Provider
(including any Swap Termination Payments) are paid in full, and no optional
redemption may be effected if it would result in a draw on the Policy, without
the written consent of each party not paid in full.
(b) On any Payment Date after April 2010, if the Note Balance of the Class
A-1 Notes has been reduced to zero, the Issuing Entity will be permitted to call
the Class A-2 Notes, and the Holders will be required to tender their Notes in
exchange for the redemption price equal to the outstanding principal balance
plus all accrued and unpaid interest thereon, including Available Funds Cap
Carry-Forward Amounts, provided that no such call may be effected unless all
amounts owed to the Swap Provider (including any Swap Termination Payments) at
such time are paid in full, and (except with the Note Insurer's consent) unless
all amounts owed to the Note Insurer are paid in full and the call would not
result in a draw on the Policy. In addition, it will
18
be a condition precedent to the exercise of the option redemption as described
in this Section 3.17(b) that the Note Insurer will have received the Insurer
Call Premium (as described in the Premium Letter) if any is then due and owing
pursuant to the Premium Letter.
(c) In order to exercise the foregoing option, the Servicer shall provide
written notice of its exercise of such option to the Indenture Trustee, the Swap
Provider, the Note Insurer and the Owner Trustee at least 30 days prior to its
exercise. In addition, the Servicer shall, not less than one Business Day prior
to the proposed Payment Date on which such redemption is to be made, deposit the
Redemption Price specified in (a) above with the Indenture Trustee.
Section 3.18. Net Contract Rate. Promptly after each Rate Determination
Date, the Servicer shall report the applicable Net Contract Rate to the Auction
Agent and the Indenture Trustee.
ARTICLE IV
SERVICING CERTIFICATE
Section 4.01. Electronic Files.
(a) No later than 1:00 p.m. on the fourth Business Day prior to each
Payment Date, the Servicer shall deliver to the Indenture Trustee, with a copy
to Citigroup Global Markets Inc. as underwriter of the Notes, the Electronic
File referred to in Section 3.04(c).
(b) With the delivery of each Electronic File pursuant to Section 4.01 (a),
the Servicer shall be deemed to certify as to the accuracy of the Electronic
File and that no Servicer Event of Default or event that with notice or lapse of
time or both would become an Servicer Event of Default has occurred, or if such
event has occurred and is continuing, specifying the event and its status.
Section 4.02. Reserved.
ARTICLE V
THE SERVICER
Section 5.01. Liability of the Servicer. The Servicer shall be liable in
accordance herewith only to the extent of the obligations specifically imposed
upon and undertaken by the Servicer or the Subservicer herein.
Section 5.02. Merger or Consolidation of or Assumption of the Obligations
of the Servicer. Any Person into which the Servicer maybe merged or
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Servicer shall be a party, or any Person succeeding
to the business of the Servicer, shall be the successor of the Servicer, as the
case may be, hereunder, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding; provided, however, that the successor servicer shall
satisfy all the requirements of an Eligible Servicer and
19
such merger or consolidation could not reasonably be expected to result in a
material adverse change with respect to the Servicer, unless approved by the
Note Insurer.
Section 5.03. Limitation on Liability of the Servicer and Others. Neither
the Servicer nor any of the directors or officers or employees or agents of the
Servicer shall be under any liability to the Trust, the Indenture Trustee, the
Noteholders or the Certificateholders for any action taken or for refraining
from the taking of any action by the Servicer in good faith pursuant to this
Agreement, or for errors in judgment; provided, however, that this provision
shall not protect the Servicer or any such Person against any liability which
would otherwise be imposed by reason of its willful misfeasance, bad faith or
negligence in the performance of duties of the Servicer or by reason of its
reckless disregard of its obligations and duties of the Servicer hereunder. The
Servicer and any director or officer or employee or agent of the Servicer may
rely in good faith on any document of any kind prima facie properly executed and
submitted by any Person respecting any matters arising hereunder. The Servicer
and any director or officer or employee or agent of the Servicer shall be
indemnified by the Trust and held harmless against any loss, liability or
expense incurred in connection with any legal action relating to this Agreement,
the Notes or the Certificates, other than any loss, liability or expense related
to any specific Contract or Contracts (except as any such loss, liability or
expense shall be otherwise reimbursable pursuant to this Agreement) and any
loss, liability or expense incurred by reason of its willful misfeasance, bad
faith or negligence in the performance of duties hereunder or by reason of its
reckless disregard of obligations and duties hereunder; and such indemnity/hold
harmless amounts as provided for in this sentence shall be payable only pursuant
to Section 8.02 (xi) of the Indenture after payments to the Noteholders for the
related Payment Date. The Servicer may undertake any such action which it may
deem necessary or desirable in respect of this Agreement, and the rights and
duties of the parties hereto and the interests of the Noteholders or the
Certificateholders hereunder. In such event, the reasonable legal expenses and
costs of such action and any liability resulting therefrom shall be expenses,
costs and liabilities of the Trust and the Servicer shall be entitled to be
reimbursed therefor only after payments to the Notes for the related Payment
Date. The Servicer's right to indemnity or reimbursement pursuant to this
Section shall survive any resignation or termination of the Servicer pursuant to
Section 5.04 or 6.01 with respect to any losses, expenses, costs or liabilities
arising prior to such resignation or termination (or arising from events that
occurred prior to such resignation or termination). This paragraph shall apply
to the Servicer solely in its capacity as Servicer hereunder and in no other
capacities.
Section 5.04. Servicer Not to Resign. Subject to the provisions of Section
5.02, the Servicer shall not resign from the obligations and duties hereby
imposed on it except (i) upon determination that the performance of its
obligations or duties hereunder are no longer permissible under applicable law
or are in material conflict by reason of applicable law with any other
activities carried on by it or its subsidiaries or Affiliates, the other
activities of the Servicer so causing such a conflict being of a type and nature
carried on by the Servicer or its subsidiaries or Affiliates at the date of this
Agreement, or (ii) upon satisfaction of the following conditions: (a) the
Servicer has proposed a successor servicer to the Indenture Trustee and the Note
Insurer in writing and such proposed successor servicer is reasonably acceptable
to the Indenture Trustee and the Note Insurer; and (b) each Rating Agency shall
have delivered a letter to the Indenture Trustee and the Note Insurer prior to
the appointment of the successor servicer stating that the proposed appointment
of such successor servicer as Servicer, as applicable, hereunder will not
20
result in the reduction or withdrawal of the then current rating of any Class of
the Notes (without regard to the Policy); provided, however, that no such
resignation by the Servicer under (i) or (ii) above shall become effective until
such successor servicer shall have assumed the Servicer's responsibilities and
obligations hereunder in accordance with this Agreement or the Indenture Trustee
shall have designated a successor servicer in accordance with Section 6.02. Any
such resignation shall not relieve the Servicer of responsibility for any of the
obligations specified in Sections 6.01 and 6.02 or this Article V as specified
as obligations that survive the resignation or termination of the Servicer. Any
such determination permitting the resignation of the Servicer pursuant to clause
(i) above shall be evidenced by an Opinion of Counsel to such effect delivered
to the Indenture Trustee and the Note Insurer.
Section 5.05. Delegation of Duties. The Servicer may not sell or assign its
rights and duties as Servicer hereunder, except as expressly provided for
herein, provided that the Servicer may pledge or assign the right to receive all
or any portion of the Monthly Servicing Fee payable to it and/or reimbursements
for Outstanding Amounts Advanced and (without duplication) Nonrecoverable
Advances.
Section 5.06. Rights of the Issuing Entity in Respect of the Servicer. The
Servicer shall afford (and any Sub-Servicing Agreement shall provide that each
Sub-Servicer shall afford) the Issuing Entity, the Note Insurer and the
Indenture Trustee, upon reasonable notice, during normal business hours, access
to all records maintained by the Servicer (and any such Sub-Servicer) in respect
of the Servicer's rights and obligations hereunder and access to officers of the
Servicer (and those of any such Sub-Servicer) responsible for such obligations.
The Issuing Entity may, but is not obligated to, enforce the obligations of the
Servicer under this Servicing Agreement and may, but is not obligated to,
perform, or cause a designee to perform, any defaulted obligation of the
Servicer under this Servicing Agreement or exercise the rights of the Servicer
under this Servicing Agreement; provided that the Servicer shall not be relieved
of any of its obligations under this Servicing Agreement by virtue of such
performance by the Issuing Entity or its designee. The Issuing Entity shall not
have any responsibility or liability for any action or failure to act by the
Servicer and is not obligated to supervise the performance of the Servicer under
this Servicing Agreement or otherwise.
Section 5.07. Indemnification. The Servicer shall indemnify and hold
harmless the Trust, the Owner Trustee, the Note Insurer and the Indenture
Trustee and their officers, directors, agents and employees from and against any
loss, liability, expense, damage or injury suffered or sustained by reason of
the Servicer's or the Subservicer's willful misfeasance, bad faith or negligence
in the performance of its activities in servicing or administering the Contracts
pursuant to this Agreement or arising out of a breach of any representation or
warranty, including, but not limited to, any judgment, award, settlement,
reasonable fees of counsel of its selection and other costs or expenses incurred
in connection with the defense of any actual or threatened action, proceeding or
claim related to the Servicer's or the Subservicer's willful misfeasance, bad
faith or negligence. Any such indemnification shall not be payable from the
assets of the Trust. The provisions of this indemnity shall run directly to and
be enforceable by an injured party subject to the limitations hereof. The
provisions of this Section 5.07 shall survive termination of this Agreement.
21
ARTICLE VI
DEFAULT
Section 6.01. Servicer Events of Default.
"Servicer Event of Default," wherever used herein, means any one of
the following events:
(a) The failure by the Servicer to deposit in the Note Payment Account any
deposit required to be made under the terms of this Agreement which continues
unremedied for a period of one Business Day after the date upon which written
notice of such failure shall have been given to the Servicer by the Indenture
Trustee (to the extent it has written or actual notice of such failure) or to
the Servicer and the Indenture Trustee by the Note Insurer or by Noteholders of
at least 25% of the aggregate Note Balances of the Notes;
(b) Failure on the Servicer's part duly to observe or perform in any
material respect any covenant or agreement in this Agreement (other than a
covenant or agreement which is elsewhere in this Section specifically dealt
with) which continues unremedied for 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 (to the extent it has written or actual
notice of such failure) or to the Servicer and the Indenture Trustee by the Note
Insurer or by Noteholders of at least 25% of the aggregate Note Balances of the
Notes;
(c) A court or other governmental authority having jurisdiction in the
premises shall have entered a decree or order for relief in respect of the
Servicer in an involuntary case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or similar official) of
the Servicer, as the case may be, or for any substantial liquidation of its
affairs, and such order remains undischarged and unstayed for at least 60 days;
(d) The Servicer shall have commenced a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or shall
have consented to the entry of an order for relief in an involuntary case under
any such law, or shall have consented to the appointment of or taking possession
by a receiver, liquidator, assignee, trustee, custodian or sequestrator (or
other similar official) of the Servicer or for any substantial part of its
property, or shall have made any general assignment for the benefit of its
creditors, or shall have failed to, or admitted in writing its inability to, pay
its debts as they become due, or shall have taken any corporate action in
furtherance of the foregoing;
(e) So long as the Originator is an affiliate of the Servicer, any failure
of the Originator, to repurchase, or substitute an Eligible Substitute Contract
for, any Contract as required by Section 2.03 of the Servicing Agreement and
Section 3.7(b) of the Contract Purchase Agreement, respectively.
(f) for any Payment Date, (i) the Average Sixty-Day Delinquency Ratio
exceeds the following percentages of the aggregate Principal Balance of the
Contracts as of the Cut-off Date: Payment Dates commencing May 2007 to and
including April 2010, 3.50%, Payment Dates
22
commencing May 2010 to and including April 2011, 4.50%, Payment Dates commencing
May 2011 to and including April 2012, 5.50%, and each Payment Date thereafter,
6.50%; (ii) the aggregate amount of Realized Losses incurred since the Cut-off
Date and as of the Payment Date exceed the following percentages as of the
Cut-off Date: Payment Dates commencing May 2007 to and including April 2008,
2.50%, Payment Dates commencing May 2008 to and including April 2009, 3.50%,
Payment Dates commencing May 2009 to and including April 2010, 4.50%, Payment
Dates commencing May 2010 to and including April 2011, 5.50%, Payment Dates
commencing May 2011 to and including April 2012, 7.00%, Payment Dates commencing
May 2012 to and including April 2013, 8.00%, Payment Dates commencing May 2013
to and including April 2014, 10.00%, and each Payment Date thereafter, 12.50%;
or (iii) the Current Realized Loss Ratio exceeds 4.25%;
(g) the Servicer shall fail to maintain and enforce a charge off policy
with respect to the Contracts whereby, for any month in which the aggregate
amount of Contracts more than 90 days delinquent or in repossession exceeds
3.00% of the aggregate Principal Balance of all Contracts, the Servicer shall
charge off any Contact in the Trust at the earliest to occur of (a) its 360th
day of delinquency, and (b) 180 days after the related Manufactured Home has
been repossessed by or on behalf of the Servicer;
(h) the Servicer shall fail to maintain a ratio of Tangible Net Worth
divided by Adjusted Assets of not less than 35%; or
(i) a claim is made under the Policy.
In the event that any of the above events occurs with respect to the
Subservicer, the Servicer shall immediately terminate the Subservicer as
subservicer under this Agreement.
Section 6.02. Transfer.
(a) If a Servicer Event of Default has occurred and is continuing, the
Controlling Party may direct the Indenture Trustee to terminate all (but not
less than all) of the Servicer's management, administrative, servicing and
collection functions as provided herein (such termination being herein called a
"Service Transfer"). The Indenture Trustee shall take any such action at the
direction of the Controlling Party. On receipt of such notice (or, if later, on
a date designated therein), or upon resignation of the Servicer in accordance
with Section 5.04, all authority and power of the Servicer under this Agreement,
whether with respect to the Contracts, the Contract Files, the Land and Home
Contract Files or otherwise (except with respect to the Collection Account, the
transfer of which shall be governed by Section 6.06), shall pass to and be
vested in the successor servicer pursuant to and under this Section 6.02; and,
without limitation, the successor servicer is 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 any and all acts or things
necessary or appropriate to effect the purposes of such notice of termination.
The Servicer agrees to cooperate with the successor servicer in effecting the
termination of the responsibilities and rights of the Servicer as provided
hereunder, including, without limitation, the transfer to the successor servicer
for administration by it of all cash amounts which shall at the time be held by
the Servicer for deposit, or have been deposited by the Servicer, in the
Collection Account pursuant to Section 6.06, or for its own account in
23
connection with its services hereafter or thereafter received with respect to
the Contracts. The Servicer shall be entitled to receive any other amounts which
are payable to the Servicer under this Agreement, at the time of the termination
of its activities as Servicer. The Servicer shall transfer to the successor
servicer (i) the Servicer's records relating to the Contracts in such electronic
form as the new servicer may reasonably request and (ii) any Contracts, Contract
Files and Land and Home Contract Files in the Servicer's possession. Any and all
costs and expenses incurred by the successor servicer in connection with the
transfer of servicing functions as provided herein, including, without
limitation, the cost of delivering the Contracts and related files to the
successor servicer, shall be paid by the initial Servicer within 10 days
following invoice therefor, and to the extent not paid in a timely manner, the
successor servicer shall be reimbursed as provided in clause (b) of this Section
6.02. The successor servicer shall not be liable to and shall be held harmless
by the Issuing Entity, the Noteholders, the Certificateholders, the Seller, the
Originator, the Depositor, the Indenture Trustee and the initial Servicer for
any and all claims arising from or related to (i) any missing or lost Contracts,
Contract Files or related documents or (ii) any inaccurate, incomplete or
missing information reasonably necessary for the servicing of the Contracts,
which is not the direct result of the willful misfeasance or negligence of the
successor servicer.
(b) On or before the Closing Date the Servicer shall deposit into an
account (the "Reserve Account") maintained with the Indenture Trustee an amount
equal to $50,000. The Reserve Account shall not be a trust account. In the event
that, upon a Service Transfer, any and all costs and expenses incurred by the
successor servicer in connection with the transfer of servicing functions as
provided herein, including, without limitation, the cost of delivering the
Contracts and related files to the successor servicer, are not paid by the
initial Servicer within 10 days following invoice therefor, and to the extent
not paid in a timely manner, the successor servicer shall forward such invoice
to the Indenture Trustee and the Indenture Trustee shall reimburse the successor
servicer from amounts on deposit in the Reserve Account, to the extent of
available funds. If amounts on deposit in the Reserve Account are not sufficient
therefor, the successor servicer may reimburse itself for such costs and
expenses from the Collection Account. The successor servicer shall promptly
notify the Indenture Trustee upon reimbursement of all invoiced costs and
expenses regardless of the source of reimbursement. Upon the earlier to occur of
(i) reimbursement to the successor servicer of all invoiced costs and expenses
incurred in connection with a Service Transfer, or (ii) the final Payment Date
with respect to the Notes, any amounts on deposit in the Reserve Account shall
be remitted to the initial Servicer by the Indenture Trustee.
Section 6.03. Appointment of Successor Servicer. The Indenture Trustee
shall send written notification of any Service Transfer or any resignation of
the Servicer in accordance with Section 5.04, within one Business Day after the
Indenture Trustee obtains actual knowledge thereof. If the Servicer is legally
unable so to act, the Indenture Trustee, at the direction of the Controlling
Party, may appoint, or the Controlling Party may direct the Indenture Trustee to
appoint, or petition a court of competent jurisdiction to appoint, an Eligible
Servicer as the successor to the Servicer hereunder in the assumption of all or
any part of the responsibilities, duties or liabilities of the Servicer
hereunder provided that, in the absence of an Insurer Default, any such
successor Servicer shall be acceptable to the Note Insurer, as evidenced by the
Note Insurer's prior written consent. Pending appointment of a successor to the
Servicer hereunder, the Servicer shall act in such capacity until a successor
servicer assumes such responsibilities,
24
duties or liabilities. In connection with such appointment and assumption, the
Indenture Trustee may make such arrangements for the compensation of such
successor out of payments on Contracts as it and such successor shall agree;
provided, however, that no such monthly compensation shall, without the written
consent of the Note Insurer (or if an Insurer Default has occurred and is
continuing of 100% of the Noteholders), exceed the Monthly Servicing Fee. The
Indenture Trustee and such successor shall take such action, consistent with
this Agreement, as shall be necessary to effectuate any such succession as
provided herein. Any successor servicer shall be entitled to rely upon the
representations, warranties and covenants made by the Originator, the Seller,
the Depositor, the Issuing Entity, the Indenture Trustee, the Owner Trustee and
the initial Servicer set forth in this Agreement and any related document
including the Basic Documents, and any successor servicer shall be held harmless
by the Issuing Entity, the Seller, the Originator, the Depositor, the Indenture
Trustee and the initial Servicer, severally and not jointly for any and all
claims, liabilities, obligations, losses, damages, payments costs or expenses
(including reasonable attorneys' fees) of any kind whatsoever incurred by the
successor servicer arising from or related to any breach, inaccuracy, default or
nonperformance of such representations, warranties or covenants of the Issuing
Entity, the Seller, the Originator, the Indenture Trustee or the initial
Servicer, as the case may be, as set forth herein or in any related document or
agreement, including the Basic Documents.
Section 6.04. Notification to Noteholders.
(a) Promptly following the occurrence of any Servicer Event of Default, the
Servicer shall give written notice thereof to the Indenture Trustee, the Rating
Agencies, the Note Insurer and the Noteholders at their respective addresses
appearing on the Note Register.
(b) Within ten days following any termination or appointment of a successor
to the Servicer pursuant to this Article VI, the Indenture Trustee shall give
written notice thereof to the Rating Agencies, the Note Insurer and the
Noteholders at their respective addresses appearing on the Note Register.
(c) The Indenture Trustee shall give written notice to the Rating Agencies
and the Note Insurer prior to the date upon which any Eligible Servicer (other
than the Indenture Trustee) is to assume the responsibilities of Servicer
pursuant to Section 6.03, naming such successor servicer.
Section 6.05. Effect of Transfer.
(a) After the Service Transfer, the successor servicer or new Servicer
shall notify Obligors to make payments directly to the new Servicer that are due
under the Contracts after the effective date of the Service Transfer.
(b) After the Service Transfer, the replaced Servicer shall have no further
obligations with respect to the management, administration, servicing or
collection of the Contracts except as provided herein and the successor servicer
shall have all of such obligations except as provided herein and the replaced
Servicer will transmit or cause to be transmitted directly to the successor
servicer for its own account, promptly on receipt and in the same form in which
received, any amounts (properly endorsed where required for the successor
servicer to collect
25
them) received as payments upon or otherwise in connection with the Contracts.
In any event, the initial Servicer shall remain obligated to fulfill its
indemnity and hold harmless obligations following a Service Transfer or
termination of this Agreement.
(c) A Service Transfer shall not affect the rights and duties of the
parties hereunder (including but not limited to the indemnities of the Servicer
pursuant to Section 5.07) other than those relating to the management,
administration, servicing or collection of the Contracts following the effective
Service Transfer. Upon and following a Servicer Transfer and commencement of
servicing by the successor servicer, the initial Servicer shall have no further
rights to the Monthly Servicing Fee, other than any accrued and unpaid Monthly
Servicing Fee due to the initial Servicer as of such date.
Section 6.06. Transfer of Collection Account. Notwithstanding the
provisions of Section 6.02, if the Collection Account shall be maintained with
the Servicer and a Servicer Event of Default shall occur and be continuing, the
Servicer shall, after five days' written notice from the Indenture Trustee and
the Note Insurer, or in any event within ten days after the occurrence of the
Servicer Event of Default, establish an Eligible Account with an institution
other than the Servicer and promptly transfer all funds in the Collection
Account to such new account, which shall thereafter be deemed the Collection
Account for the purposes hereof. Upon a Service Transfer, the Collection Account
shall be transferred to an Eligible Account as directed by the successor
servicer.
ARTICLE VII
MISCELLANEOUS PROVISIONS
Section 7.01. Amendment. This Servicing Agreement may be amended from time
to time by the parties hereto without the consent of the Noteholders but with
the prior written consent of the Note Insurer (for so long as the Policy is
outstanding), provided that any amendment be accompanied by a letter from the
Rating Agencies that the amendment will not result in the downgrading or
withdrawal of the rating then assigned to the Notes or the rating then assigned
to the Notes. None of the Basic Documents shall be amended or modified so as to
adversely affect the rights or impose additional obligations upon the Servicer
without the express written consent of the Servicer.
Section 7.02. GOVERNING LAW. THIS SERVICING AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS (EXCEPT SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 7.03. Notices. All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given if when
delivered to:
(a) in the case of the Servicer: Origen Financial L.L.C.
Origen Servicing, Inc.
26
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ and ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
(b) in the case of Rating
Agencies: ▇▇▇▇▇'▇ Investors Service, Inc.
4th Floor
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Residential Mortgage
Monitoring Unit
Standard & Poor's, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
By electronic mail to:
▇▇▇▇▇▇▇▇_▇▇▇▇▇▇▇@▇▇▇▇▇.▇▇▇
With copy to:
Standard & Poor's
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ - 41st Floor
New York, New York 10041
Attention: Asset Backed Surveillance
Group
(c) in the case of the Owner
Trustee, the Corporate Trust
Office: Wilmington Trust Company
▇▇▇▇▇▇ Square North
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust
Administration
27
(d) in the case of the Issuing
Entity, to Origen
Manufactured Housing
Contract Trust 2007-A: Origen Servicing, Inc.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ and ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
(e) in the case of the Indenture
Trustee: The Bank of New York Trust Company,
N.A.
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Structured Finance, Origen
2007-A
(f) in the case of the Note
Insurer: Ambac Assurance Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Risk Management,
Consumer Asset-Backed Securities
Origen 2007-A
or, as to each party, at such other address as shall be designated by such party
in a written notice to each other party. Any notice required or permitted to be
mailed to a Noteholder shall be given by first class mail, postage prepaid, at
the address of such Noteholder as shown in the Note Register. Any notice so
mailed within the time prescribed in this Servicing Agreement shall be
conclusively presumed to have been duly given, whether or not the Noteholder
receives such notice. Any notice or other document required to be delivered or
mailed by the Indenture Trustee to any Rating Agency shall be given on a
reasonable efforts basis and only as a matter of courtesy and accommodation and
the Indenture Trustee shall have no liability for failure to deliver such notice
or document to any Rating Agency.
Section 7.04. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Servicing Agreement shall be
for any reason whatsoever held invalid, then such covenants, agreements,
provisions or terms shall be deemed severable from the remaining covenants,
agreements, provisions or terms of this Servicing Agreement and shall in no way
affect the validity or enforceability of the other provisions of this Servicing
Agreement or of the Notes or the rights of the Noteholders thereof.
Section 7.05. Third-Party Beneficiaries. This Servicing Agreement will
inure to the benefit of and be binding upon the parties hereto, the Noteholders,
the Owner Trustee, the Indenture Trustee and their respective successors and
permitted assigns. The Note Insurer and its successor and assigns will be a
third-party beneficiary to the provisions of this Servicing Agreement and will
be entitled to rely upon and directly enforce such provisions of this Servicing
Agreement. Except as otherwise provided in this Servicing Agreement, no other
28
Person shall have any right or obligation hereunder. The Indenture Trustee shall
have the right to exercise all rights of the Issuing Entity under this Servicing
Agreement.
Section 7.06. Counterparts. This instrument maybe executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all such counterparts shall together constitute but one and the same instrument.
Section 7.07. Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
Section 7.08. Termination. The respective obligations and responsibilities
of the Servicer and the Issuing Entity created hereby shall terminate (except as
provided herein) upon the satisfaction and discharge of the Indenture pursuant
to Section 4.10 thereof.
Section 7.09. No Petition. The Servicer, by entering into this Servicing
Agreement, hereby covenants and agrees that it will not at any time institute
against the Issuing Entity, or join in any institution against the Issuing
Entity, any bankruptcy proceedings under any United States federal or state
bankruptcy or similar law in connection with any obligations of the Issuing
Entity. This section shall survive the termination of this Servicing Agreement
by one year.
Section 7.10. No Recourse. The Servicer acknowledges that no recourse maybe
had against the Issuing Entity, except as may be expressly set forth in this
Servicing Agreement.
Section 7.11. Indenture Trustee Rights. The Indenture Trustee shall be
entitled to the same rights, protections, indemnities and immunities afforded to
it under the Indenture as if specifically set forth herein.
Section 7.12. Rights of the Note Insurer to Exercise Rights of Noteholders.
Notwithstanding anything to the contrary in this Agreement, by accepting its
Class A Note, each Noteholder agrees that, the Note Insurer is an express third
party beneficiary of this Servicing Agreement and shall, have the right to
exercise all rights of the Noteholders as specified under this Servicing
Agreement as if it were a party hereto without any further consent of the
Noteholders for so long as it is the Controlling Party.
Section 7.13. Reports to Note Insurer. The Seller, the Servicer and the
Indenture trustee, as applicable shall provide copies to the Note Insurer of all
statements, reports and notices delivered under this Servicing Agreement to any
other party hereto, and Rating Agency or any Noteholder or Certificateholder.
29
ARTICLE VIII
DUTIES OF THE SUBSERVICER AS ADMINISTRATOR
Section 8.01. Administrative Duties.
(a) Duties with Respect to the Indenture and the Auction Agent Agreement.
The Subservicer as administrator (the "Administrator") shall perform all its
duties and the duties of the Issuing Entity under the Indenture and the Auction
Agent Agreement. In addition, the Administrator shall consult with the Owner
Trustee as the Administrator deems appropriate regarding the duties of the
Issuing Entity under the Indenture and the Auction Agent Agreement. The
Administrator shall monitor the performance of the Issuing Entity and shall
advise the Owner Trustee when action is necessary to comply with the Issuing
Entity's duties under the Indenture and the Auction Agent Agreement. The
Administrator shall prepare for execution by the Issuing Entity or shall cause
the preparation by other appropriate Persons of all such documents, reports,
filings, instruments, certificates and opinions as it shall be the duty of the
Issuing Entity to prepare, file or deliver pursuant to the Indenture and the
Auction Agent Agreement. In furtherance of the foregoing, the Administrator
shall take all necessary action that is the duty of the Issuing Entity to take
pursuant to the Indenture and the Auction Agent Agreement.
(b) Duties with Respect to the Issuing Entity.
(i) In addition to the duties of the Administrator set forth in this
Servicing Agreement or any of the Basic Documents, the Administrator shall
perform such calculations and shall prepare for execution by the Issuing Entity
or the Owner Trustee or shall cause the preparation by other appropriate Persons
of all such documents, reports, filings, instruments, certificates and opinions
as it shall be the duty of the Issuing Entity or the Owner Trustee to prepare,
file or deliver pursuant to this Servicing Agreement or any of the Basic
Documents or under state and federal tax and securities laws (including, but not
limited to, UCC filings in applicable jurisdictions and annual compliance
certificates, if any), and shall take all appropriate action that it is the duty
of the Issuing Entity to take pursuant to this Servicing Agreement or any of the
Basic Documents. In accordance with the directions of the Issuing Entity or the
Owner Trustee, the Administrator shall administer, perform or supervise the
performance of such other activities in connection with the Notes (including the
Basic Documents) as are not covered by any of the foregoing provisions and as
are expressly requested by the Issuing Entity, the Indenture Trustee or the
Owner Trustee.
(ii) In carrying out the foregoing duties or any of its other
obligations under this Servicing Agreement, the Administrator may enter into
transactions with or otherwise deal with any of its Affiliates; provided,
however, that the terms of any such transactions or dealings shall be in
accordance with any directions received from the Issuing Entity and shall be, in
the Administrator's opinion, no less favorable to the Issuing Entity in any
material respect than with terms made available to unrelated third parties.
(c) Tax Matters. The Administrator shall prepare and file on behalf of the
Owner Trustee or the Issuing Entity, all tax returns (if any) and information
reports, tax elections and
30
such annual or other reports of the Issuing Entity as are necessary for
preparation of tax returns and information reports as provided in Section 5.03
of the Trust Agreement, other than each Form 1099 which shall be prepared by the
Indenture Trustee.
(d) Non-Ministerial Matters. With respect to matters that in the reasonable
judgment of the Administrator are non-ministerial, the Administrator shall not
take any action pursuant to this Article V in unless within a reasonable time
before the taking of such action, the Administrator shall have notified the
Owner Trustee, the Note Insurer and the Indenture Trustee of the proposed action
and the Owner Trustee, the Note Insurer and, with respect to items (A), (B), (C)
and (D) below, the Indenture Trustee shall not have withheld consent or provided
an alternative direction. For the purpose of the preceding sentence,
"non-ministerial matters" shall include:
(A) the amendment of or any supplement to the Indenture;
(B) the initiation of any claim or lawsuit by the Issuing Entity and
the compromise of any action, claim or lawsuit brought by or against the
Issuing Entity (other than in connection with the collection of the
Contracts);
(C) the amendment, change or modification of this Servicing Agreement
or any of the Basic Documents to which the Indenture Trustee or the Owner
Trustee, as applicable, is a party;
(D) the appointment of successor Certificate Paying Agents and
successor Indenture Trustees pursuant to the Indenture or the appointment
of successor servicers or the consent to the assignment by the Certificate
Registrar, Paying Agent or Indenture Trustee of its obligations under the
Indenture; and
(E) the removal of the Indenture Trustee.
(e) Subservicer Shall Act as Administrator. By execution of this Agreement,
the Subservicer agrees to be bound as Administrator and shall perform the
obligations of the Administrator as described herein. Upon the occurrence of a
Service Transfer, the Servicer shall continue to act as "Administrator"
hereunder unless a successor Administrator is appointed by 100% of the holders
of the Owner Trust Certificates with the prior written consent of the Note
Insurer (in the absence of an Insurer Default) and notice of such appointment is
promptly given to the Successor Servicer and the Indenture Trustee.
Section 8.02. Records. The Administrator shall maintain appropriate books
of account and records relating to services performed under this Servicing
Agreement, which books of account and records shall be accessible for inspection
by the Issuing Entity, the Indenture Trustee and the Owner Trustee at any time
during normal business hours.
Section 8.03. Additional Information to be Furnished. The Administrator
shall furnish to the Issuing Entity, the Note Insurer, the Indenture Trustee and
the Owner Trustee from time to time such additional information regarding the
Contracts and the Notes as the Issuing Entity, the Note Insurer, the Indenture
Trustee or the Owner Trustee shall reasonably request.
31
Section 8.04. No Recourse to Owner Trustee. It is expressly understood and
agreed by the parties hereto that (a) this Agreement is executed and delivered
by Wilmington Trust Company individually or personally, but solely as Owner
Trustee of Origen Manufactured Housing Contract Trust 2007-A, in the exercise of
the powers and authority conferred and vested in it, (b) each of the
representations, undertakings and agreements herein made on the part of the
Issuing Entity is made and intended not as personal representations,
undertakings and agreements by Wilmington Trust Company but is made and intended
for the purpose for binding only the Issuing Entity, (c) nothing herein
contained shall be construed as creating any liability of Wilmington Trust
Company, individually or personally, to perform any covenant either expressed or
implied contained herein, all such liability, if any, being expressly waived by
the parties hereto and by any Person claiming by, through or under the parties
hereto and (d) under no circumstances shall Wilmington Trust Company be
personally liable for the payment of any indebtedness or expenses of the Issuing
Entity or be liable for the breach or failure of any obligation, representation,
warranty or covenant made or undertaken by the Issuing Entity under this
Agreement or any other related documents.
Section 8.05. Exchange Act Reporting.
(a) (i) Within 15 days after each Payment Date for so long as the Issuing
Entity is subject to the Exchange Act reporting requirements, the Indenture
Trustee shall, in accordance with industry standards, file with the Commission
via the Electronic Data Gathering and Retrieval System ("▇▇▇▇▇"), a Form 10-D,
signed by the Servicer, with a copy of the monthly statement to be furnished by
the Indenture Trustee to the Noteholders for such Payment Date pursuant to
Section 7.05 of the Indenture (the "Monthly Statement"); provided that the
Indenture Trustee shall have received no later than four (4) Business Days prior
to the related Payment Date (the "Servicer Reporting Date"), all information
required to be provided to the Indenture Trustee as described below. Any
disclosure in addition to the Monthly Statement that is required to be included
on Form 10-D ("Additional Form 10-D Disclosure") shall be approved by the
Depositor.
(ii) Within five (5) calendar days after the related Servicer
Reporting Date, (A) the Servicer and Administrator shall provide to the
Indenture Trustee and the Depositor, to the extent known, in
▇▇▇▇▇-compatible format at the following email address: ▇▇_▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
with respect to the Indenture Trustee, or in such other form as otherwise
agreed upon by the Indenture Trustee and the Depositor and such party, the
form and substance of any Additional Form 10-D Disclosure, if applicable,
and (B) the Depositor will approve, as to form and substance, or
disapprove, as the case may be, the inclusion of the Additional Form 10-D
Disclosure on Form 10-D. The Depositor will be responsible for any
reasonable fees and expenses assessed or incurred by the Indenture Trustee
in connection with including any Additional Form 10-D Disclosure on Form
10-D pursuant to this Section.
(iii) After preparing the Form 10-D, the Indenture Trustee shall
forward electronically a draft copy of the Form 10-D to the Depositor and
the Servicer for review. No later than two (2) Business Days prior to the
15th calendar day after the related Payment Date, either the Depositor or a
senior officer of the Servicer in charge of the servicing function shall
sign the Form 10-D and return an electronic or fax copy of such
32
signed Form 10-D (with an original executed hard copy to follow by
overnight mail) to the Indenture Trustee. For administrative convenience,
the Depositor or the Servicer may deliver executed signature pages to the
Indenture Trustee to be held by the Indenture Trustee in escrow and
attached to a Form 10-D only upon such Depositor's or Servicer's electronic
notification to the Indenture Trustee authorizing such attachment. If a
Form 10-D cannot be filed on time or if a previously filed Form 10-D needs
to be amended, the Indenture Trustee will follow the procedures set forth
in Section 8.05(g). Promptly (but no later than one (1) Business Day) after
filing with the Commission, the Servicer will make available on its
internet website a final executed copy of each Form 10-D. The signing party
at the Depositor or the Servicer can be contacted as set forth in Section
7.03. The parties to this Agreement acknowledge that the performance by the
Indenture Trustee of its duties under the Section 8.05(a) related to the
timely preparation and filing of Form 10-D is contingent upon all parties
strictly observing all applicable deadlines in the performance of their
duties under this Agreement. The Indenture Trustee shall have no liability
for any loss, expense, damage, claim arising out of or with respect to any
failure to properly prepare and/or timely file such Form 10-D, where such
failure results from the Indenture Trustee's inability or failure to
receive, on a timely basis, any information from any other party hereto
needed to prepare, arrange for execution or file such Form 10-D, not
resulting from its own negligence, bad faith or willful misconduct.
(b) (i) Within four (4) Business Days after the occurrence of an event
requiring disclosure on Form 8-K (each such event, a "Reportable Event") for so
long as the Issuing Entity is subject to the Exchange Act reporting
requirements, the Indenture Trustee shall prepare and file on behalf of the
Issuing Entity any Form 8-K prepared by the Depositor, as required by the
Exchange Act; provided that the Depositor shall file the initial Form 8-K in
connection with the issuance of the Notes; provided further, that the Indenture
Trustee shall only be responsible for filing such Form 8-K if the Indenture
Trustee has been notified by the Depositor of the necessity therefore and
provided with the disclosure to be included therein. Any disclosure or
information related to a Reportable Event or that is otherwise required to be
included on Form 8-K ("Form 8-K Disclosure Information") shall be prepared by
the Depositor.
(ii) For so long as the Issuing Entity is subject to the Exchange Act
reporting requirements, no later than 12:00 p.m. New York time on the 2nd
Business Day after the occurrence of a Reportable Event (i) the Servicer
and Administrator shall provide to the Indenture Trustee and the Depositor,
to the extent known, in ▇▇▇▇▇-compatible format at the following email
address: ▇▇_▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇ with respect to the Indenture Trustee, or in
such other form as otherwise agreed upon by the Indenture Trustee and the
Depositor and such party, the form and substance of any Form 8-K Disclosure
Information, if applicable, and (ii) the Depositor will approve, as to form
and substance, or disapprove, as the case may be, the inclusion of the Form
8-K Disclosure Information on Form 8-K. The Depositor will be responsible
for any reasonable fees and expenses assessed or incurred by the Indenture
Trustee in connection with including any Form 8-K Disclosure Information on
Form 8-K pursuant to this Section.
(iii) No later than the end of business New York City time on the 3rd
Business Day after the Reportable Event, either the Depositor or a senior
officer of the Servicer in charge of the servicing function shall sign the
Form 8-K and return an electronic or fax
33
copy of such signed Form 8-K (with an original executed hard copy to follow
by overnight mail) to the Indenture Trustee. If a Form 8-K cannot be filed
on time or if a previously filed Form 8-K needs to be amended, the
Indenture Trustee will follow the procedures set forth in Section 8.05(g).
Promptly (but no later than 1 Business Day) after filing with the
Commission, the Servicer will, make available on its internet website a
final executed copy of each Form 8-K. The signing party at the Depositor or
the Servicer can be contacted as set forth in Section 7.03. The parties to
this Agreement acknowledge that the performance by the Indenture Trustee of
its duties under this Section 8.05(b) related to the timely preparation and
filing of Form 8-K is contingent upon all parties strictly observing all
applicable deadlines in the performance of their duties under this
Agreement. The Indenture Trustee shall have no liability for any loss,
expense, damage, claim arising out of or with respect to any failure to
properly prepare and/or timely file such Form 8-K, where such failure
results from the Indenture Trustee's inability or failure to receive, on a
timely basis, any information from any other party hereto needed to
prepare, arrange for execution or file such Form 8-K, not resulting from
its own negligence, bad faith or willful misconduct.
(c) (i) Within 90 days after the end of each fiscal year of the Issuing
Entity or such earlier date as may be required by the Exchange Act (the "10-K
Filing Deadline") (it being understood that the fiscal year for the Issuing
Entity ends on December 31st of each year) for so long as the Issuing Entity is
subject to the Exchange Act reporting requirements, commencing in March 2008,
the Indenture Trustee shall prepare and file on behalf of the Issuing Entity a
Form 10-K, in form and substance as required by the Exchange Act. Each such Form
10-K shall include the following items, in each case to the extent they have
been delivered to the Indenture Trustee within the applicable time frames set
forth in this Agreement, (1) an annual compliance statement of the Servicer and
any subservicer, as described under Section 3.15, (2) the annual reports on
assessment of compliance with Servicing Criteria for the Servicer, each
subservicer and each subcontractor materially participating in servicing
functions, each servicing function participant, the Indenture Trustee and each
custodian, as described under Section 3.16(a), (3) the registered public
accounting firm attestation report for the Servicer and the Indenture Trustee,
as described under Section 3.16(b), which shall identify any material instance
of noncompliance, and (4) a ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification as described in this
Section 8.05 (c)(iv) below. Any disclosure or information in addition to (1)
through (4) above that is required to be included on Form 10-K ("Additional Form
10-K Disclosure") shall be determined and prepared by and approved by the
Depositor.
(ii) No later than March 5th of each year that the Issuing Entity is
subject to the Exchange Act reporting requirements, commencing in 2008, (1)
the Servicer and Administrator shall provide to the Indenture Trustee and
the Depositor, to the extent known, in ▇▇▇▇▇-compatible format at the
following email address: ▇▇_▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇ with respect to the Indenture
Trustee, or in such other form as otherwise agreed upon by the Indenture
Trustee and the Depositor and such party, the form and substance of any
Additional Form 10-K Disclosure, if applicable, and (2) the Depositor will
approve, as to form and substance, or disapprove, as the case may be, the
inclusion of the Additional Form 10-K Disclosure on Form 10-K. The
Depositor will be responsible for any reasonable fees and expenses assessed
or incurred by the Indenture
34
Trustee in connection with including any Additional Form 10-K Disclosure on
Form 10-K pursuant to this Section.
(iii) After preparing the Form 10-K, the Indenture Trustee shall
forward electronically a draft copy of the Form 10-K to the Depositor and
the Servicer for review. No later than 12:00 p.m. New York time on the 4th
Business Day prior to the 10-K Filing Deadline, either the Depositor or a
senior officer of the Servicer in charge of the servicing function shall
sign the Form 10-K and return an electronic or fax copy of such signed Form
10-K (with an original executed hard copy to follow by overnight mail) to
the Indenture Trustee. If a Form 10-K cannot be filed on time or if a
previously filed Form 10-K needs to be amended, the Indenture Trustee will
follow the procedures set forth in Section 8.05(g). Promptly (but no later
than one (1) Business Day) after filing with the Commission, the Servicer
will make available on its internet website a final executed copy of each
Form 10-K. The signing party at the Depositor or the Servicer can be
contacted as set forth in Section 7.03. The parties to this Agreement
acknowledge that the performance by the Indenture Trustee of its duties
under this Section 8.05(c) related to the timely preparation and filing of
Form 10-K is contingent upon such parties strictly observing all applicable
deadlines in the performance of their duties under this Agreement. The
Indenture Trustee shall have no liability for any loss, expense, damage,
claim arising out of or with respect to any failure to properly prepare
and/or timely file such Form 10-K, where such failure results from the
Indenture Trustee's inability or failure to receive, on a timely basis, any
information from any other party hereto needed to prepare, arrange for
execution or file such Form 10-K, not resulting from its own negligence,
bad faith or willful misconduct.
(iv) Each Form 10-K shall include a certification (the "▇▇▇▇▇▇▇▇-▇▇▇▇▇
Certification"), in the form attached hereto as Exhibit C-1, required to be
included therewith pursuant to the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act. The Servicer and the
Indenture Trustee, shall and the Servicer shall cause any subservicer or
subcontractor engaged by it to, provide to the Person who signs the
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification (the "Certifying Person"), by March 15 of each
year in which the Issuing Entity is subject to the reporting requirements
of the Exchange Act, a certification (each, a "Back-Up Certification"), in
the form attached hereto as Exhibit C-2, upon which the Certifying Person,
the entity for which the Certifying Person acts as an officer, and such
entity's officers, directors and Affiliates (collectively with the
Certifying Person, "Certification Parties") can reasonably rely. The senior
officer of the Servicer shall serve as the Certifying Person on behalf of
the Issuing Entity. Such officer of the Certifying Person can be contacted
as set forth in Section 7.03. In the event the Indenture Trustee is
terminated or resigns pursuant to the terms of this Agreement, the
Indenture Trustee shall provide a Back-Up Certification to the Certifying
Person pursuant to this Section 8.05(c) with respect to the period of time
it was subject to this Agreement.
(d) With respect to any Additional Form 10-D Disclosure or Additional From
10-K Disclosure (collectively, the "Additional Disclosure") relating to the
Trust Estate, the Indenture Trustee's obligation to include such Additional
Information in the applicable Exchange Act report is subject to receipt from the
Servicer, Administrator and Depositor, as and when required as described in this
Section 8.05. Each of the Servicer, Administrator and Depositor hereby
35
agree to notify and provide to the extent known all Additional Disclosure
relating to the Trust Estate to the Indenture Trustee and the Depositor.
(e) With respect to any Form 8-K Disclosure Information (collectively, the
"8-K Additional Disclosure") relating to the Trust Estate, the Depositor's
obligation to include such 8-K Additional Information in the applicable Exchange
Act report provided by it to the Indenture Trustee is subject to receipt from
the Servicer or Administrator, as and when required as described in this Section
8.05. Each of the Servicer, Administrator, and Depositor hereby agree to notify
and provide to the extent known all 8-K Additional Disclosure relating to the
Trust Estate to the Indenture Trustee and the Depositor.
(f) On or prior to January 30 of the first year in which the Indenture
Trustee is able to do so under applicable law, the Indenture Trustee shall file
a Form 15 relating to the automatic suspension of reporting in respect of the
Issuing Entity under the Exchange Act, and shall provide notice to the
Depositor, the Servicer and the Custodian of such filing.
(g) In the event that the Indenture Trustee is unable to timely file with
the Commission all or any required portion of any Form 10-D or 10-K required to
be filed by this Agreement because required disclosure information was either
not delivered to it or delivered to it after the delivery deadlines set forth in
this Agreement or for any other reason, the Indenture Trustee will immediately
notify the Depositor and the Servicer. In the case of Form 10-D and 10-K, the
Depositor, Servicer and Indenture Trustee will cooperate to prepare and file a
Form 12b-25 and a 10-DA and 10-KA as applicable, pursuant to Rule 12b-25 of the
Exchange Act. In the case of Form 8-K, the Depositor will, upon receipt of all
required Form 8-K Disclosure Information provide such Form 8-K Disclosure
Information to the Indenture Trustee for inclusion on the next Form 10-D. In the
event that any previously filed Form 10-D or 10-K needs to be amended, the
Indenture Trustee (to the extent of actual knowledge) will notify the Depositor
and the Servicer and such parties will cooperate to prepare any necessary 10-DA
or 10-KA. Any Form 15, Form 12b-25 or any amendment to Form 8-K, 10-D or 10-K
shall be signed by a senior officer of the Servicer. The Depositor and Servicer
acknowledge that the performance by the Indenture Trustee of its duties under
this Section 5.18(g) related to the timely preparation and filing of Form 15, a
Form 12b-25 or any amendment to Form 10-D or 10-K is contingent upon the
Servicer and the Depositor performing their duties under this Section. The
Indenture Trustee shall have no liability for any loss, expense, damage, claim
arising out of or with respect to any failure to properly prepare and/or timely
file any such Form 15, Form 12b-25 or any amendments to Forms 10-D or 10-K,
where such failure results from the Indenture Trustee's inability or failure to
receive, on a timely basis, any information from any other party hereto needed
to prepare, arrange for execution or file such Form 15, Form 12b-25 or any
amendments to Forms 8-K, 10-D or 10-K, not resulting from its own negligence,
bad faith or willful misconduct.
(h) The Depositor agrees to promptly furnish to the Indenture Trustee, from
time to time upon request, such further information, reports and financial
statements within its control related to this Agreements, the other Basic
Documents or the Contracts as is necessary for the preparation and filing of all
required reports with the Commission. The Indenture Trustee shall have no
responsibility to file any items other than those specified in this Section
8.05; provided, however, the Indenture Trustee will cooperate with the Depositor
in connection with any
36
additional filings with respect to the Issuing Entity as the Depositor deems
necessary under the Exchange Act. Copies of all reports filed by the Indenture
Trustee under the Exchange Act shall be sent to the Depositor.
Section 8.06. Indemnification.
The Administrator shall indemnify and hold harmless the Trust, the
Owner Trustee, the Note Insurer and the Indenture Trustee and their officers,
directors, agents and employees from and against any loss, liability, expense,
damage or injury suffered or sustained by reason of the Administrator's willful
misfeasance, bad faith or negligence in the performance of its activities
pursuant to this Agreement, including, but not limited to, any judgment, award,
settlement, reasonable fees of counsel of its selection and other costs or
expenses incurred in connection with the defense of any actual or threatened
action, proceeding or claim related to the Administrator's willful misfeasance,
bad faith or negligence. Any such indemnification shall not be payable from the
assets of the Trust. The provisions of this indemnity shall run directly to and
be enforceable by an injured party subject to the limitations hereof. The
provisions of this Section 8.06 shall survive termination of this Agreement.
37
IN WITNESS WHEREOF, the Servicer, the Subservicer, the Issuing Entity and
the Indenture Trustee have caused this Servicing Agreement to be duly executed
by their respective officers or representatives all as of the day and year first
above written.
ORIGEN FINANCIAL L.L.C.,
as Servicer
By: /s/ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Jr.
------------------------------------
Name: ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Jr.
Title: Chief Financial Officer
ORIGEN SERVICING, INC.,
as Subservicer and Administrator
By: /s/ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Jr.
------------------------------------
Name: ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Jr.
Title: Chief Financial Officer
ORIGEN MANUFACTURED HOUSING
CONTRACT TRUST 2007-A, as Issuing Entity
By: Wilmington Trust Company,
not in its individual capacity, but
solely as Owner Trustee
By: /s/ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
Title: Assistant Vice President
THE BANK OF NEW YORK TRUST COMPANY,
N.A., as Indenture Trustee
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
(Signature Page to Origen 2007-A Servicing Agreement)
38
ORIGEN RESIDENTIAL SECURITIES, INC.,
as Depositor
By: /s/ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Jr.
------------------------------------
Name: ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Jr.
Title: Chief Financial Officer
(Signature Page Two to Servicing Agreement)
39
EXHIBIT A
LIST OF CONTRACTS
[The List of Contracts is on file with the Servicer
and is available upon request]
A-1
EXHIBIT B
FORM OF CERTIFICATE REGARDING REPURCHASED CONTRACTS
ORIGEN FINANCIAL L.L.C.
CERTIFICATE REGARDING REPURCHASED CONTRACTS
The undersigned certifies that he is a [title] of Origen Financial
L.L.C., a Delaware limited liability company (the "Company"), and that as such
he is duly authorized to execute and deliver this certificate on behalf of the
Company pursuant to Section 2.03 of the Servicing Agreement, dated as of April
1, 2007 (the "Agreement"), among the Company, Origen Servicing, Inc., Origen
Manufactured Housing Trust 2007-A and The Bank of New York Trust Company, N.A.,
as indenture trustee (the "Indenture Trustee") (all capitalized terms used
herein without definition having the respective meanings specified in the
Indenture (the "Indenture"), dated as of April 1, 2007, between Origen
Manufactured Housing Contract Trust 2007-A (the "Issuing Entity") and the
Indenture Trustee), and further certifies that:
1. The Contracts on the attached schedule are to be repurchased by the
Company on the date hereof pursuant to Section 2.03 of the Agreement.
2. Upon deposit of the Repurchase Price for such Contracts, such
Contracts may, pursuant to Section 2.03 of the Agreement, be assigned by the
Indenture Trustee to the Company.
IN WITNESS WHEREOF, I have affixed hereunto my signature this _____
day of ____________, ______.
ORIGEN FINANCIAL L.L.C.
By:
------------------------------------
[Name]
---------------------------------
[Title]
--------------------------------
B-1
EXHIBIT C-1
FORM OF CERTIFICATION TO BE PROVIDED BY
THE SERVICER WITH FORM 10-K
Re: Origen Manufactured Housing Contract Trust 2007-A (the "Trust" or
the "Issuing Entity"), Origen Manufactured Housing Contract Trust
Collateralized Notes, Series 2007-A
I, [identify the certifying individual], the senior officer of Origen
Servicing, Inc., the Servicer for Origen Manufactured Housing Contract Trust
2007-A (the "Registrant"), certify that:
1. I have reviewed this annual report on Form 10-K, and all reports on
Form 8-K containing distribution and servicing reports filed in respect of
periods included in the year covered by this annual report, of Registrant;
2. Based on my knowledge, the information in these reports, taken as a
whole, does not contain any untrue statement of a material fact or omit to state
a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading as of the
last day of the period covered by this annual report;
3. Based on my knowledge, the distribution information required to be
provided by the Indenture Trustee under the Indenture, and the servicing
information required to be provided to the Indenture Trustee by the Servicer
under the Servicing Agreement for inclusion in these reports, is included in
these reports;
4. Based on my knowledge and upon the annual compliance statements
included in the report and required to be delivered to the Indenture Trustee in
accordance with the terms of the Servicing Agreement, and except as disclosed in
the reports, the Servicer has fulfilled its obligations under the Servicing
Agreement; and
5. The reports disclose all significant deficiencies relating to the
servicer's compliance with the minimum servicing standards based upon the report
provided by an independent public accountant, after conducting a review in
compliance with the Uniform Single Attestation Program for Mortgage Bankers or
similar procedure, as set forth in the servicing, or similar, agreement, that is
included in these reports.
In giving the certifications above, I have reasonably relied on
information provided to me by the Indenture Trustee.
C-1-1
Capitalized terms used but not defined herein have the meanings
ascribed to them in Appendix A to the Indenture, dated April 1, 2007 (the
"Indenture"), between Origen Manufactured Housing Contract Trust 2007-A as
Issuing Entity, and The Bank of New York Trust Company, N.A., as indenture
trustee.
[SERVICER]
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Date:
----------------------------------
C-1-2
EXHIBIT C-2
FORM OF CERTIFICATION TO BE PROVIDED
TO THE ADMINISTRATOR BY THE INDENTURE TRUSTEE
Re: Origen Manufactured Housing Contract Trust 2007-A (the "Trust" or
the "Issuing Entity"), Origen Manufactured Housing Contract Trust
Collateralized Notes, Series 2007-A
I, [identify the certifying individual], a [title] of The Bank of New
York Trust Company, N.A., as Indenture Trustee, hereby certify to Origen
Servicing, Inc. (the "Administrator"), and its officers, directors and
affiliates, and with the knowledge and intent that they will rely upon this
certification, that:
To date, the information and statements required to be provided by the
Indenture Trustee pursuant to Section 7.05 of the Indenture have been provided
and, taken as a whole and based on the information provided to the Indenture
Trustee by the Servicer (as to which provided information we make no
representation), do not contain any untrue statement of a material fact or omit
to state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading as of the
date of each of such statements.
Capitalized terms used but not defined herein have the meanings
ascribed to them in Appendix A to the Indenture, dated April 1, 2007 (the
"Indenture"), between Origen Manufactured Housing Contract Trust 2007-A, as
Issuing Entity, and The Bank of New York Trust Company, N.A., as indenture
trustee.
THE BANK OF NEW YORK TRUST COMPANY,
N.A., as Indenture Trustee
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Date:
----------------------------------
C-2-1
EXHIBIT D
OFFICER'S CERTIFICATE
REGARDING ANNUAL STATEMENT OF COMPLIANCE
Origen Manufactured Housing Contract Trust Collateralized Notes, Series 2007-A
I, _________________, hereby certify that I am a duly appointed
____________________________ of Origen Financial L.L.C. (the "Servicer"), and
further certify as follows:
1. This certification is being made pursuant to the terms of the
Servicing Agreement, dated as of April 1, 2007 (the "Servicing Agreement"),
among Origen Manufactured Housing Contract Trust 2007-A, as Issuing Entity, the
Servicer, as servicer, Origen Servicing, Inc., as subservicer (the
"Subservicer") and The Bank of New York Trust Company, N.A., as indenture
trustee.
2. I have reviewed the activities of the Servicer and the Subservicer
during the preceding year and the Servicer's performance (and the Subservicer's
performance on the Servicer's behalf) under the Servicing Agreement and to the
best of my knowledge, based on such review, each of the Servicer and Subservicer
has fulfilled all of its obligations under the Servicing Agreement throughout
the year.
Capitalized terms not otherwise defined herein have the meanings set
forth in the Servicing Agreement.
Dated: ________________
D-1
IN WITNESS WHEREOF, the undersigned has executed this Certificate as
of ________________________.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
I, ______________________, a (an) _________________ of the [Servicer],
hereby certify that ____________________________ is a duly elected, qualified,
and acting ___________________________________ of the [Servicer] and that the
signature appearing above is his/her genuine signature.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as
of ________________________.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
D-2
EXHIBIT E
SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The assessment of compliance to be delivered by the Servicer shall address
the criteria identified as below as "Applicable Servicing Criteria":
APPLICABLE
SERVICING
APPLICABLE CRITERIA
SERVICING FOR THE
CRITERIA FOR INDENTURE
SERVICING CRITERIA THE SERVICER TRUSTEE
------------------------------------------------------------------------------ ------------- ----------------
REFERENCE CRITERIA
GENERAL SERVICING CONSIDERATIONS
1122(d)(1)(i) Policies and procedures are instituted to monitor any performance or other X X (to the extent
triggers and events of default in accordance with the transaction agreements. that the
Indenture Trustee
is responsible
for such policies
and procedures
under the
transaction
documents)
1122(d)(1)(ii) If any material servicing activities are outsourced to third parties, policies X
and procedures are instituted to monitor the third party's performance and
compliance with such servicing activities.
1122(d)(1)(iii) Any requirements in the transaction agreements to maintain a back-up servicer
for the mortgage loans are maintained.
1122(d)(1)(iv) A fidelity bond and errors and omissions policy is in effect on the party X
participating in the servicing function throughout the reporting period in the
amount of coverage required by and otherwise in accordance with the terms of
the transaction agreements.
CASH COLLECTION AND ADMINISTRATION
1122(d)(2)(i) Payments on mortgage loans are deposited into the appropriate custodial bank X
accounts and related bank clearing accounts no more than two business days
following receipt, or such other number of days specified in the transaction
agreements.
1122(d)(2)(ii) Disbursements made via wire transfer on behalf of an obligor or to an investor X X (to the extent
are made only by authorized personnel. that the
Indenture Trustee
makes such
disbursements)
1122(d)(2)(iii) Advances of funds or guarantees regarding collections, cash flows or X
distributions, and any interest or other fees charged for such advances, are
made, reviewed and approved as specified in the transaction agreements.
E-1
APPLICABLE
SERVICING
APPLICABLE CRITERIA
SERVICING FOR THE
CRITERIA FOR INDENTURE
SERVICING CRITERIA THE SERVICER TRUSTEE
------------------------------------------------------------------------------ ------------- ----------------
REFERENCE CRITERIA
1122(d)(2)(iv) The related accounts for the transaction, such as cash reserve accounts or X X
accounts established as a form of overcollateralization, are separately
maintained (e.g., with respect to commingling of cash) as set forth in the
transaction agreements.
1122(d)(2)(v) Each custodial account is maintained at a federally insured depository X X (Transaction
institution as set forth in the transaction agreements. For purposes of this agreements
criterion, "federally insured depository institution" with respect to a currently do not
foreign financial institution means a foreign financial institution that meets require custodial
the requirements of Rule 13k-1(b)(1) of the Securities Exchange Act. accounts to be
established at
federally insured
depository
institutions;
however, if the
criteria is
further clarified
such that
custodial
accounts are to
be established at
federally insured
depository
institutions, OR
as set forth in
the transaction
agreements, then
the criteria
would be
applicable to the
Indenture Trustee)
1122(d)(2)(vi) Unissued checks are safeguarded so as to prevent unauthorized access. X
1122(d)(2)(vii) Reconciliations are prepared on a monthly basis for all asset-backed X X (to the extent
securities related bank accounts, including custodial accounts and related that the
bank clearing accounts. These reconciliations are (A) mathematically accurate; Indenture Trustee
(B) prepared within 30 calendar days after the bank statement cutoff date, or holds such
such other number of days specified in the transaction agreements; (C) accounts)
reviewed and approved by someone other than the person who prepared the
reconciliation; and (D) contain explanations for reconciling items. These
reconciling items are resolved within 90 calendar days of their original
identification, or such other number of days specified in the transaction
agreements.
INVESTOR REMITTANCES AND REPORTING
1122(d)(3)(i) Reports to investors, including those to be filed with the Commission, are X X
maintained in accordance with the transaction agreements and applicable
Commission requirements. Specifically, such reports (A) are prepared
E-2
APPLICABLE
SERVICING
APPLICABLE CRITERIA
SERVICING FOR THE
CRITERIA FOR INDENTURE
SERVICING CRITERIA THE SERVICER TRUSTEE
------------------------------------------------------------------------------ ------------- ----------------
REFERENCE CRITERIA
in accordance with timeframes and other terms set forth in the transaction
agreements; (B) provide information calculated in accordance with the terms
specified in the transaction agreements; (C) are filed with the Commission as
required by its rules and regulations; and (D) agree with investors' or the
trustee's records as to the total unpaid principal balance and number of
mortgage loans serviced by the Servicer.
1122(d)(3)(ii) Amounts due to investors are allocated and remitted in accordance with X X
timeframes, distribution priority and other terms set forth in the transaction
agreements.
1122(d)(3)(iii) Disbursements made to an investor are posted within two business days to the X X
Servicer's investor records, or such other number of days specified in the
transaction agreements.
1122(d)(3)(iv) Amounts remitted to investors per the investor reports agree with cancelled X X
checks, or other form of payment, or custodial bank statements.
POOL ASSET ADMINISTRATION
1122(d)(4)(i) Collateral or security on mortgage loans is maintained as required by the X
transaction agreements or related mortgage loan documents.
1122(d)(4)(ii) Mortgage loan and related documents are safeguarded as required by the X
transaction agreements.
1122(d)(4)(iii) Any additions, removals or substitutions to the asset pool are made, reviewed X
and approved in accordance with any conditions or requirements in the
transaction agreements.
1122(d)(4)(iv) Payments on mortgage loans, including any payoffs, made in accordance with the X
related mortgage loan documents are posted to the Servicer's obligor records
maintained no more than two business days after receipt, or such other number
of days specified in the transaction agreements, and allocated to principal,
interest or other items (e.g., escrow) in accordance with the related mortgage
loan documents.
1122(d)(4)(v) The Servicer's records regarding the mortgage loans agree with the Servicer's X
records with respect to an obligor's unpaid principal balance.
1122(d)(4)(vi) Changes with respect to the terms or status of an obligor's mortgage loans X
(e.g., loan modifications or re-agings) are made, reviewed and approved by
authorized personnel in accordance with the transaction agreements and related
pool asset documents.
E-3
APPLICABLE
SERVICING
APPLICABLE CRITERIA
SERVICING FOR THE
CRITERIA FOR INDENTURE
SERVICING CRITERIA THE SERVICER TRUSTEE
------------------------------------------------------------------------------ ------------- ----------------
REFERENCE CRITERIA
1122(d)(4)(vii) Loss mitigation or recovery actions (e.g., forbearance plans, modifications X
and deeds in lieu of foreclosure, foreclosures and repossessions, as
applicable) are initiated, conducted and concluded in accordance with the
timeframes or other requirements established by the transaction agreements.
1122(d)(4)(viii) Records documenting collection efforts are maintained during the period a X
mortgage loan is delinquent in accordance with the transaction agreements.
Such records are maintained on at least a monthly basis, or such other period
specified in the transaction agreements, and describe the entity's activities
in monitoring delinquent mortgage loans including, for example, phone calls,
letters and payment rescheduling plans in cases where delinquency is deemed
temporary (e.g., illness or unemployment).
1122(d)(4)(ix) Adjustments to interest rates or rates of return for mortgage loans with X
variable rates are computed based on the related mortgage loan documents.
1122(d)(4)(x) Regarding any funds held in trust for an obligor (such as escrow accounts): X
(A) such funds are analyzed, in accordance with the obligor's mortgage loan
documents, on at least an annual basis, or such other period specified in the
transaction agreements; (B) interest on such funds is paid, or credited, to
obligors in accordance with applicable mortgage loan documents and state laws;
and (C) such funds are returned to the obligor within 30 calendar days of full
repayment of the related mortgage loans, or such other number of days
specified in the transaction agreements.
1122(d)(4)(xi) Payments made on behalf of an obligor (such as tax or insurance payments) are X
made on or before the related penalty or expiration dates, as indicated on the
appropriate bills or notices for such payments, provided that such support has
been received by the servicer at least 30 calendar days prior to these dates,
or such other number of days specified in the transaction agreements.
1122(d)(4)(xii) Any late payment penalties in connection with any payment to be made on behalf X
of an obligor are paid from the servicer's funds and not charged to the
obligor, unless the late payment was due to the obligor's error or omission.
1122(d)(4)(xiii) Disbursements made on behalf of an obligor are posted within two business days X
to the obligor's records maintained by the servicer, or such other number of
days specified in the transaction agreements.
E-4
APPLICABLE
SERVICING
APPLICABLE CRITERIA
SERVICING FOR THE
CRITERIA FOR INDENTURE
SERVICING CRITERIA THE SERVICER TRUSTEE
------------------------------------------------------------------------------ ------------- ----------------
REFERENCE CRITERIA
1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible accounts are recognized and X
recorded in accordance with the transaction agreements.
1122(d)(4)(xv) Any external enhancement or other support, identified in Item 1114(a)(1) X
through (3) or Item 1115 of Regulation AB, is maintained as set forth in the
transaction agreements.
E-5