EMC MORTGAGE CORPORATION Purchaser, WACHOVIA MORTGAGE CORPORATION Seller SELLER’S PURCHASE, WARRANTIES AND SERVICING AGREEMENT Dated as of July 1, 2005
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EXECUTION
COPY
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EMC
MORTGAGE CORPORATION
Purchaser,
WACHOVIA
MORTGAGE CORPORATION
Seller
Dated
as
of July 1, 2005
TABLE
OF CONTENTS
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ARTICLE
I DEFINITIONS
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Section
1.01.
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Defined
Terms.
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ARTICLE
II SERVICING OF MORTGAGE LOANS; RECORD TITLE AND POSSESSION OF MORTGAGE
FILES; BOOKS AND RECORDS; CUSTODIAL AGREEMENT; DELIVERY OF MORTGAGE
LOAN
DOCUMENTS
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Section
2.01.
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Agreement
to Purchase.
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Section
2.02.
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Purchase
Price.
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Section
2.03.
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Servicing
of Mortgage Loans.
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Section
2.04.
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Record
Title and Possession of Mortgage Files; Maintenance of Servicing
Files.
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Section
2.05.
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Books
and Records.
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Section
2.06.
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Transfer
of Mortgage Loans.
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Section
2.07.
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Delivery
of Mortgage Loan Documents.
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Section
2.08.
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Quality
Control Procedures.
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Section
2.09.
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Closing.
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ARTICLE
III REPRESENTATIONS AND WARRANTIES OF THE SELLER; REPURCHASE; REVIEW
OF
MORTGAGE LOANS
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Section
3.01.
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Representations
and Warranties of the Seller.
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Section
3.02.
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Representations
and Warranties as to Individual Mortgage Loans.
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Section
3.03.
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Repurchase.
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Section
3.04.
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Purchase
Price Protection.
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Section
3.05.
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Repurchase
of Mortgage Loans With First Payment Defaults.
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ARTICLE
IV ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS
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Section
4.01.
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The
Seller to Act as Servicer.
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Section
4.02.
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Collection
of Mortgage Loan Payments.
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Section
4.03.
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Realization
Upon Defaulted Mortgage Loans.
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Section
4.04.
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Establishment
of Custodial Accounts; Deposits in Custodial Accounts.
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Section
4.05.
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Permitted
Withdrawals From the Custodial Account.
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Section
4.06.
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Establishment
of Escrow Accounts; Deposits in Accounts.
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Section
4.07.
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Permitted
Withdrawals From the Escrow Account.
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Section
4.08.
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Payment
of Taxes, Insurance and Charges; Maintenance of Primary Mortgage
Insurance; Collections Thereunder.
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Section
4.09.
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Transfer
of Accounts.
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Section
4.10.
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Maintenance
of Hazard Insurance.
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Section
4.11.
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Maintenance
of Mortgage Impairment Insurance Policy.
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Section
4.12.
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Maintenance
of Fidelity Bond and Errors and Omissions Insurance.
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Section
4.13.
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Title,
Management and Disposition of REO Property.
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Section
4.14.
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Notification
of Maturity Date.
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ARTICLE
V PAYMENTS TO THE PURCHASER
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Section
5.01.
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Distributions.
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Section
5.02.
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Statements
to the Purchaser.
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Section
5.03.
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Monthly
Advances by the Seller.
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Section
5.04.
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Liquidation
Reports.
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ARTICLE
VI GENERAL SERVICING PROCEDURES
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Section
6.01.
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Assumption
Agreements.
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Section
6.02.
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Satisfaction
of Mortgages and Release of Mortgage Files.
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Section
6.03.
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Servicing
Compensation.
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Section
6.04.
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Annual
Statement as to Compliance.
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Section
6.05.
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Annual
Independent Certified Public Accountants’ Servicing
Report.
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Section
6.06.
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Purchaser’s
Right to Examine Seller Records.
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Section
6.07.
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Seller
Shall Provide Information as Reasonably Required.
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ARTICLE
VII THE SELLER
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Section
7.01.
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Indemnification;
Third Party Claims.
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Section
7.02.
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Merger
or Consolidation of the Seller.
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Section
7.03.
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Limitation
on Liability of the Seller and Others.
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Section
7.04.
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Seller
Not to Assign or Resign.
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Section
7.05.
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No
Transfer of Servicing.
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ARTICLE
VIII DEFAULT
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Section
8.01.
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Events
of Default.
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Section
8.02.
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Waiver
of Defaults.
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ARTICLE
IX TERMINATION
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Section
9.01.
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Termination.
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ARTICLE
X RECONSTITUTION OF MORTGAGE LOANS
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Section
10.01.
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Reconstitution
of Mortgage Loans.
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ARTICLE
XI MISCELLANEOUS PROVISIONS
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Section
11.01.
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Successor
to the Seller.
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Section
11.02.
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Amendment.
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Section
11.03.
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Recordation
of Agreement.
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Section
11.04.
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Governing
Law.
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Section
11.05.
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Notices.
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Section
11.06.
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Severability
of Provisions.
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Section
11.07.
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Exhibits.
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Section
11.08.
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General
Interpretive Principles.
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Section
11.09.
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Reproduction
of Documents.
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Section
11.10.
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Confidentiality
of Information.
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Section
11.11.
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Recordation
of Assignments of Mortgage.
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Section
11.12.
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Assignment
by Purchaser.
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Section
11.13.
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No
Partnership.
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Section
11.14.
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Execution;
Successors and Assigns.
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Section
11.15.
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Entire
Agreement.
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Section
11.16.
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No
Solicitation.
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Section
11.17.
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Costs.
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Section
11.18.
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Protection
of Mortgagor Personal Information.
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EXHIBITS
A-1 Contents
of Mortgage File
A-2 Contents
of Servicing File
B Form
of Custodial Account Letter Agreement
C Form
of Escrow Account Letter Agreement
D Form
of Assignment, Assumption and Recognition Agreement
E Form
of Assignment and Conveyance
F Request
for Release of Documents and Receipt
This
is a
Seller’s Purchase, Warranties and Servicing Agreement, dated as of July 1,
2005 and is executed by and between EMC Mortgage Corporation, as purchaser
(the
“Purchaser”), and Wachovia Mortgage Corporation, as seller and servicer
(in such capacity, the “Seller”).
WITNESSETH:
WHEREAS,
the Purchaser has heretofore agreed to purchase from the Seller and the Seller
has heretofore agreed to sell to the Purchaser certain Mortgage Loans, servicing
rights retained, from time to time, pursuant to the terms of a letter agreement
by and between the Seller and the Purchaser (the “Purchase Price and Terms
Letter”);
WHEREAS,
each of the Mortgage Loans is secured by a mortgage, deed of trust or other
security instrument creating a first or second lien on a residential dwelling
located in the jurisdiction indicated on the related Mortgage Loan Schedule,
which is annexed to the related Assignment and Conveyance. The
Mortgage Loans as described herein shall be delivered in groups of whole loans
(each, a “Mortgage Loan Package”) on various dates as provided herein
(each, a “Closing Date”); and
WHEREAS,
the Purchaser and the Seller wish to prescribe the representations and
warranties of the Seller with respect to itself, the Mortgage Loans and the
management, servicing and control of the Mortgage Loans by the
Seller.
NOW,
THEREFORE, in consideration of the mutual agreements hereinafter set forth,
and
for other good and valuable consideration, the receipt and adequacy of which
is
hereby acknowledged, the Purchaser and the Seller agree as follows:
ARTICLE
I
DEFINITIONS
Section
1.01. Defined
Terms.
Whenever
used in this Agreement, the following words and phrases, unless the context
otherwise requires, shall have the following meaning specified in this
Article:
Accepted
Servicing Practices: With respect to any Mortgage Loan, those
mortgage servicing practices (including collection procedures) of prudent
mortgage banking institutions which service mortgage loans of the same type
as
such Mortgage Loan in the jurisdiction where the related Mortgaged Property
is
located, and which are in accordance with ▇▇▇▇▇▇ ▇▇▇ servicing practices and
procedures, for MBS pool mortgages, as defined in the ▇▇▇▇▇▇ Mae Guides,
including future updates.
Adjustable
Rate Mortgage Loan: A Mortgage Loan as to which the related
Mortgage Note provides that the Mortgage Interest Rate may be adjusted
periodically.
Adjustment
Date: With respect to each Adjustable Rate Mortgage Loan, the
date set forth in the related Mortgage Note on which the Mortgage Interest
Rate
on the Mortgage Loan is adjusted in accordance with the terms of the Mortgage
Note.
Agency
Transfer: The sale or transfer by the Purchaser of some or all of
the Mortgage Loans to ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac.
Agreement: This
Seller’s Purchase, Warranties and Servicing Agreement including all exhibits
hereto, amendments hereof and supplements hereto.
Appraised
Value: With respect to any Mortgaged Property, the lesser of (i) the value
thereof as determined by an appraisal made for the originator of the Mortgage
Loan at the time of origination of the Mortgage Loan by an appraiser who met
the
underwriting requirements of the originator, and (ii) the purchase price paid
for the related Mortgaged Property by the Mortgagor with the proceeds of the
Mortgage Loan, provided, however, in the case of a Refinanced Mortgage
Loan, such value of the Mortgaged Property is based solely upon the value
determined by an appraisal made for the originator of such Refinanced Mortgage
Loan at the time of origination of such Refinanced Mortgage Loan by an appraiser
who met the underwriting requirements of the originator.
Assignment
and Conveyance: As defined in Section 2.03.
Assignment
of Mortgage: An assignment of the Mortgage, notice of transfer or
equivalent instrument in recordable form, sufficient under the laws of the
jurisdiction wherein the related Mortgaged Property is located to reflect the
transfer of the Mortgage.
BIF: The
Bank Insurance Fund, or any successor thereto.
Business
Day: Any day other than (i) a Saturday or a Sunday, or (ii) a
legal holiday in the States of New York or North Carolina, or (iii) a day on
which banks in the States of New York or North Carolina are authorized or
obligated by law or executive order to be closed.
Closing
Date: The date or dates set forth in the related Purchase Price
and Terms Letter on which the Purchaser from time to time shall purchase and
the
Seller from time to time shall sell to the Purchaser, the Mortgage Loans listed
on the related Mortgage Loan Schedule with respect to the related Mortgage
Loan
Package.
Code: The
Internal Revenue Code of 1986, as the same may be amended from time to time
(or
any successor statute thereto).
Compensating
Interest: For any Remittance Date, the lesser of (i) the
aggregate Servicing Fee payable to the Seller for such Remittance Date and
(ii)
the aggregate Prepayment Interest Shortfall for such Remittance
Date.
Condemnation
Proceeds: All awards, compensation and settlements in respect of
a Mortgaged Property, whether permanent or temporary, partial or entire, by
exercise of the power of eminent domain or condemnation, to the extent not
required to be released to a Mortgagor in accordance with the terms of the
related Mortgage Loan Documents.
Convertible
Mortgage Loan: Any Adjustable Rate Mortgage Loan purchased
pursuant to this Agreement as to which the related Mortgage Note permits the
Mortgagor to convert the Mortgage Interest Rate on such Mortgage Loan to a
fixed
Mortgage Interest Rate.
Co-op
Lease: With respect to a Co-op Loan, the lease with respect to a
dwelling unit occupied by the Mortgagor and relating to the stock allocated
to
the related dwelling unit.
Co-op
Loan: A Mortgage Loan secured by the pledge of stock allocated to
a dwelling unit in a residential cooperative housing corporation and a
collateral assignment of the related Co-op Lease.
Co-op
Stock: With respect to a Co-op Loan, the single outstanding class
of stock, partnership interest or other ownership instrument in the related
residential cooperative housing corporation.
Credit
Score: The credit score for each Mortgage Loan shall be the minimum of two
credit bureau scores obtained at origination or such other time by the
Seller. If two credit bureau scores are obtained, the Credit Score
will be the lower score. If three credit bureau scores are obtained,
the Credit Score will be the middle of the three. When there is more
than one applicant, the lowest of the applicants’ Credit Scores will be
used. There is only one (1) score for any loan regardless of the
number of borrowers and/or applicants.
Custodial
Account: Each separate demand account or accounts created and
maintained pursuant to Section 4.04 which shall be entitled “Wachovia Mortgage
Corporation, in trust for the Purchaser, owner of various whole loan series” and
shall be established as an Eligible Account, in the name of the Person that
is
the “Purchaser” with respect to the related Mortgage Loans.
Cut-off
Date: With respect to each Mortgage Loan Package, the first Business Day of
the month of the related Closing Date, or as otherwise set forth in the related
Purchase Price and Terms Letter.
Determination
Date: With respect to each Remittance Date, the 15th day (or if
such 15th day is not a Business Day, the Business Day immediately preceding
such
15th day) of the month in which such Remittance Date occurs.
Due
Date: With respect to any Mortgage Loan, the day of the month on
which the Monthly Payment is due on such Mortgage Loan, exclusive of any days
of
grace.
Due
Period: With respect to each Remittance Date, the period
commencing on the second day of the month preceding the month of such Remittance
Date and ending on the first day of the month of the Remittance
Date.
Eligible
Account: An account established and maintained: (a) within FDIC insured
accounts (or other accounts with comparable insurance coverage acceptable to
the
Rating Agencies) created, maintained and monitored by the Seller so that all
funds deposited therein are fully insured, (b) with the corporate trust
department of a financial institution assigned a long-term debt rating of not
less than “Baa3,” and a short term debt rating of “P3,” from ▇▇▇▇▇’▇ Investors
Services, Inc. and, if ownership of the Mortgage Loans is evidenced by mortgaged
backed securities, the equivalent ratings of the rating agencies, and held
such
that the rights of the Purchaser and the owner of the Mortgage Loans shall
be
fully protected against the claims of any creditors of the Seller and of any
creditors or depositors of the institution in which such account is maintained
or (c) in a separate non-trust account without FDIC or other insurance in an
Eligible Institution. In the event that a Custodial Account is
established pursuant to clause (b) or (c) of the preceding sentence, the Seller
shall provide the Purchaser with written notice on the Business Day following
the date on which the applicable institution fails to meet the applicable
ratings requirements.
Eligible
Institution: An institution having (i) the highest short-term
debt rating, and one of the two highest long-term debt ratings of the Rating
Agency; or (ii) with respect to any Custodial Account, an unsecured long-term
debt rating of at least one of the two highest unsecured long-term debt ratings
of the Rating Agencies.
Eligible
Investments: Any one or more of the following obligations or
securities:
(a) direct
obligations of, and obligations fully guaranteed by the United States of America
or any agency or instrumentality of the United States of America the obligations
of which are backed by the full faith and credit of the United States of
America;
(b) (i)
demand or time deposits, federal funds or bankers’ acceptances issued by any
depository institution or trust company incorporated under the laws of the
United States of America or any state thereof and subject to supervision and
examination by federal and/or state banking authorities, provided that the
commercial paper and/or the short-term deposit rating and/or the long-term
unsecured debt obligations or deposits of such depository institution or trust
company at the time of such investment or contractual commitment providing
for
such investment are rated in one of the two highest rating categories by each
Rating Agency and (ii) any other demand or time deposit or certificate of
deposit that is fully insured by the FDIC;
(c) repurchase
obligations with a term not to exceed thirty (30) days and with respect to
(i)
any security described in clause (a) above and entered into with a depository
institution or trust company (acting as principal) described in clause (b)(ii)
above;
(d) securities
bearing interest or sold at a discount issued by any corporation incorporated
under the laws of the United States of America or any state thereof that are
rated in one of the two highest rating categories by each Rating Agency at
the
time of such investment or contractual commitment providing for such investment;
provided, however, that securities issued by any particular
corporation will not be Eligible Investments to the extent that investments
therein will cause the then outstanding principal amount of securities issued
by
such corporation and held as Eligible Investments to exceed 10% of the aggregate
outstanding principal balances of all of the Mortgage Loans and Eligible
Investments;
(e) commercial
paper (including both non-interest-bearing discount obligations and
interest-bearing obligations payable on demand or on a specified date not more
than one year after the date of issuance thereof) which are rated in one of
the
two highest rating categories by each Rating Agency at the time of such
investment;
(f) any
other demand, money market or time deposit, obligation, security or investment
as may be acceptable to each Rating Agency as evidenced in writing by each
Rating Agency; and
(g) any
money market funds the collateral of which consists of obligations fully
guaranteed by the United States of America or any agency or instrumentality
of
the United States of America the obligations of which are backed by the full
faith and credit of the United States of America (which may include repurchase
obligations secured by collateral described in clause (a)) and other securities
and which money market funds are rated in one of the two highest rating
categories by each Rating Agency.
provided,
however, that no instrument or security shall be an Eligible Investment
if such instrument or security evidences a right to receive only interest
payments with respect to the obligations underlying such instrument or if such
security provides for payment of both principal and interest with a yield to
maturity in excess of 120% of the yield to maturity at par or if such investment
or security is purchased at a price greater than par.
Equity: With
respect to any second lien Mortgage Loan, the Appraised Value, less the unpaid
principal balance of the related First Lien.
Equity
Loan-to-Value: With respect to any second lien Mortgage Loan, the
original principal balance of such Mortgage Loan, divided by the
Equity.
Escrow
Account: Each separate trust account or accounts created and
maintained pursuant to Section 4.06 which shall be entitled “Wachovia Mortgage
Corporation, in trust for the Purchaser, owner of various whole loan series
and
various Mortgagors” and shall be established as an Eligible Account, in the name
of the Person that is the “Purchaser” with respect to the related Mortgage
Loans.
Escrow
Payments: With respect to any Mortgage Loan, the amounts
constituting ground rents, taxes, assessments, water rates, sewer rents,
municipal charges, mortgage insurance premiums, fire and hazard insurance
premiums, condominium charges, and any other payments required to be escrowed
by
the Mortgagor with the mortgagee pursuant to the Mortgage, applicable law or
any
other related document.
Event
of Default: Any one of the conditions or circumstances enumerated
in Section 8.01.
▇▇▇▇▇▇
Mae: The entity formerly known as the Federal National Mortgage
Association, or any successor thereto.
▇▇▇▇▇▇
▇▇▇ Guides: The ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇’ Guide and the ▇▇▇▇▇▇ ▇▇▇
Servicers’ Guide and all amendments or additions thereto, including, but not
limited to, future updates thereof.
FDIC: The
Federal Deposit Insurance Corporation, or any successor thereto.
Fidelity
Bond: A fidelity bond to be maintained by the Seller pursuant to
Section 4.12.
FIRREA: The
Financial Institutions Reform, Recovery, and Enforcement Act of 1989, as amended
and in effect from time to time.
First
Lien: With respect to any second lien Mortgage Loan, the mortgage
loan relating to the corresponding Mortgaged Property having a first priority
lien.
First
Remittance Date: The eighteenth (18th) day of the month following each
respective Closing Date, or if such day is not a Business Day, the first
Business Day immediately preceding such 18th day.
Fixed
Rate Mortgage Loan: A Mortgage Loan purchased pursuant to this
Agreement which bears a fixed Mortgage Interest Rate during the life of the
loan.
▇▇▇▇▇▇▇
Mac: The entity formerly known as the Federal Home Loan Mortgage
Corporation, or any successor thereto.
▇▇▇▇▇▇▇
Mac Guides: The ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇’ Guide and the ▇▇▇▇▇▇▇ Mac
Servicers’ Guide and all amendments or additions thereto, including, but not
limited to, any future updates thereof.
GAAP: Generally
accepted accounting principles, consistently applied.
Gross
Margin: With respect to any Adjustable Rate Mortgage Loan, the
fixed percentage amount set forth in the related Mortgage Note and the related
Mortgage Loan Schedule that is added to the Index on each Adjustment Date in
accordance with the terms of the related Mortgage Note to determine the new
Mortgage Interest Rate for such Mortgage Loan.
HUD: The
United States Department of Housing and Urban Development or any successor
thereto.
Index: With
respect to any Adjustable Rate Mortgage Loan, the index identified on the
Mortgage Loan Schedule and set forth in the related Mortgage Note for the
purpose of calculating the Mortgage Interest Rate thereon.
Insurance
Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged
Property.
Interest
Only Mortgage Loan: A Mortgage Loan that only requires payments
of interest for a period of time specified in the related Mortgage
Note.
Liquidation
Proceeds: Amounts received in connection with the partial or
complete liquidation of a defaulted Mortgage Loan, whether through the sale
or
assignment of such Mortgage Loan, trustee’s sale, foreclosure sale or otherwise,
or in connection with the sale of the Mortgaged Property if the Mortgaged
Property is acquired in satisfaction of the Mortgage.
Loan-to-Value
Ratio or LTV: With respect to any Mortgage Loan, the ratio
of the original outstanding principal amount of the Mortgage Loan and, with
respect to any second lien Mortgage Loan, the outstanding principal amount
of
any related First Lien as of the date of origination of such mortgage loan,
to
the Appraised Value of the related Mortgaged Property.
Maximum
Mortgage Interest Rate: With respect to each Adjustable Rate
Mortgage Loan, a rate that is set forth on the related Mortgage Loan Schedule
and in the related Mortgage Note and is the maximum interest rate to which
the
Mortgage Interest Rate on such Mortgage Loan may be increased on any Adjustment
Date.
MERS: Mortgage
Electronic Registration Systems, Inc., a corporation organized and existing
under the laws of the State of Delaware, or any successor thereto.
MERS
Mortgage Loan: Any Mortgage Loan registered with MERS on the MERS
System.
MERS
System: The system of recording transfers of mortgages
electronically maintained by MERS.
MIN: The
Mortgage Identification Number for any MERS Mortgage Loan.
Minimum
Mortgage Interest Rate: With respect to each Adjustable Rate
Mortgage Loan, a rate that is set forth on the related Mortgage Loan Schedule
and in the related Mortgage Note and is the minimum interest rate to which
the
Mortgage Interest Rate on such Mortgage Loan may be decreased on any Adjustment
Date.
MOM
Loan: Any Mortgage Loan as to which MERS is acting as mortgagee,
solely as nominee for the originator of such Mortgage Loan and its successors
and assigns.
Monthly
Advance: The payment required to be made by the Seller with
respect to any Remittance Date pursuant to Section 5.03.
Monthly
Payment: The scheduled monthly payment on a Mortgage Loan due on
any Due Date allocable to principal and/or interest on such Mortgage Loan
pursuant to the terms of the related Mortgage Note.
Mortgage: With
respect to any Mortgage Loan that is not a Co-op Loan, the mortgage, deed of
trust or other instrument securing a Mortgage Note which creates a first or
second lien on an unsubordinated estate in fee simple in real property securing
the Mortgage Note; except that with respect to real property located in
jurisdictions in which the use of leasehold estates for residential properties
is a widely-accepted practice, the mortgage, deed of trust or other instrument
securing the Mortgage Note may secure and create a first or second lien upon
a
leasehold estate of the Mortgagor. With respect to a Co-op Loan, the
related Security Agreement.
Mortgage
File: With respect to each Mortgage Loan, the documents
pertaining thereto specified in Exhibit A-1 and any additional documents
required to be added to the Mortgage File pursuant to this
Agreement.
Mortgage
Interest Rate: As to each Mortgage Loan, the annual rate at which
interest accrues on such Mortgage Loan in accordance with the provisions of
the
related Mortgage Note.
Mortgage
Loan: An individual Mortgage Loan which is the subject of this
Agreement, each Mortgage Loan originally sold and subject to this Agreement
being identified on the related Mortgage Loan Schedule, which Mortgage Loan
includes without limitation the Mortgage File, the Monthly Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
REO Disposition Proceeds, any escrow accounts related to the Mortgage Loan,
and
all other rights, benefits, proceeds and obligations arising from or in
connection with such Mortgage Loan, excluding replaced or repurchased mortgage
loans.
Mortgage
Loan Documents: The documents contained in a Mortgage
File.
Mortgage
Loan Package: As defined in the Recitals to this Agreement.
Mortgage
Loan Remittance Rate: With respect to each Mortgage Loan, the
Mortgage Interest Rate less the related Servicing Fee Rate.
Mortgage
Loan Schedule: The schedule of Mortgage Loans annexed to the
related Assignment and Conveyance, each such schedule setting forth the
following information with respect to each Mortgage Loan in the related Mortgage
Loan Package:
(1) the
Seller’s Mortgage Loan identifying number;
(2) the
Mortgagor’s name;
(3) the
street address of the Mortgaged Property including the state and zip
code;
(4) a
code indicating whether the Mortgaged Property is owner-occupied;
(5) the
type of residential property constituting the Mortgaged Property;
(6) the
original months to maturity or the remaining months to maturity from the related
Cut-off Date, in any case based on the original amortization schedule and,
if
different, the maturity expressed in the same manner but based on the actual
amortization schedule;
(7) the
Loan-to-Value Ratio at origination and as of the related Cut-off
Date;
(8) with
respect to any second lien Mortgage Loan, the Equity Loan-to-Value Ratio at
origination and as of the related Cut-off Date;
(9) the
Mortgage Interest Rate at origination and as of the related Cut-off
Date;
(10) the
Mortgage Loan origination date;
(11) the
paid through date;
(12) the
stated maturity date of the Mortgage Loan and of the First Lien, if
applicable;
(13) the
amount of the Monthly Payment as of the related Cut-off Date;
(14) the
original principal amount of the Mortgage Loan and the principal balance of
the
related First Lien, if applicable, as of the date of origination;
(15) the
Scheduled Principal Balance of the Mortgage Loan and the principal balance
of
the related First Lien, if applicable, as of the related Cut-off
Date;
(16) a
code indicating the purpose of the Mortgage Loan (i.e., purchase, rate and
term
refinance, equity take-out refinance);
(17) a
code indicating the documentation style (i.e. full, alternative or
reduced);
(18) the
number of times during the twelve (12) month period preceding the related
Closing Date that any Monthly Payment has been received thirty (30) or more
days
after its Due Date;
(19) the
date on which the first Monthly Payment is due and the applicable next Due
Date;
(20) a
code indicating whether or not the Mortgage Loan is insured as to payment
defaults by a Primary Mortgage Insurance Policy; and, in the case of any
Mortgage Loan which is insured as to payment defaults by a Primary Mortgage
Insurance Policy, the name of the provider of such Primary Mortgage Insurance
Policy;
(21) a
code indicating whether or not the Mortgage Loan is the subject of a prepayment
penalty, and if so, the terms of such prepayment penalty;
(22) the
Primary Mortgage Insurance Policy certificate number, if
applicable;
(23) the
Primary Mortgage Insurance Policy coverage percentage, if
applicable;
(24) a
code indicating the Credit Score of the Mortgagor at the time of origination
of
the Mortgage Loan;
(25) a
code indicating the specific loan/underwriting program of each Mortgage Loan
as
assigned by the Seller pursuant to the Underwriting Standards;
(26) the
loan type (i.e. fixed, adjustable; 2/28, 3/27, 5/25,
etc.);
(27) with
respect to each Adjustable Rate Mortgage Loan, the first Adjustment Date and
the
Adjustment Date frequency;
(28) with
respect to each Adjustable Rate Mortgage Loan, the Gross Margin;
(29) with
respect to each Adjustable Rate Mortgage Loan, the Maximum Mortgage Interest
Rate under the terms of the Mortgage Note;
(30) with
respect to each Adjustable Rate Mortgage Loan, the Minimum Mortgage Interest
Rate under the terms of the Mortgage Note;
(31) with
respect to each Adjustable Rate Mortgage Loan, the Periodic Rate
Cap;
(32) with
respect to each Adjustable Rate Mortgage Loan, the first Adjustment Date
immediately following the related Cut-off Date;
(33) with
respect to each Adjustable Rate Mortgage Loan, the Index;
(34) a
code indicating whether the Mortgage Loan is a second lien Mortgage
Loan;
(35) a
code indicating whether the Mortgage Loan is a MERS Mortgage Loan;
and
(36) a
code indicating whether the Mortgage Loan is an Interest Only Mortgage Loan
and
the term of the interest-only period.
With
respect to the Mortgage Loans in the aggregate in each Mortgage Loan Package,
the Mortgage Loan Schedule shall set forth the following information, as of
the
related Cut-off Date unless otherwise specified:
(1) the
number of Mortgage Loans;
(2) the
current aggregate outstanding principal balance of the Mortgage
Loans;
(3) the
weighted average Mortgage Interest Rate of the Mortgage Loans;
(4) the
weighted average original months to maturity of the Mortgage Loans and the
weighted average remaining months to maturity of the Mortgage
Loans.
Mortgage
Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
Mortgaged
Property: With respect to any Mortgage Loan, the underlying real
property securing repayment of the related Mortgage Note, consisting of a fee
simple parcel of real estate or a leasehold estate, the term of which is equal
to or longer than the term of such Mortgage Note.
Mortgagor: The
obligor on a Mortgage Note.
Mortgagor
Personal Information: Any information, including, but not limited
to, all personal information about a Mortgagor that is disclosed to the Seller
or the Purchaser by or on behalf of the Mortgagor.
OCC: Office
of the Comptroller of the Currency, its successors and assigns.
Officers’
Certificate: A certificate signed by the Chairman of the Board,
the Vice Chairman of the Board, the President, a Senior Vice President or a
Vice
President and by the Treasurer or the Secretary or one of the Assistant
Treasurers or Assistant Secretaries of the Seller, and delivered to the
Purchaser as required by this Agreement.
Opinion
of Counsel: A written opinion of counsel, who may be an employee
of the party on behalf of whom the opinion is being given, reasonably acceptable
to the Purchaser.
OTS: Office
of Thrift Supervision or any successor thereto.
Pass-Through
Transfer: As defined in Section 10.01(a)(iii).
Periodic
Rate Cap: With respect to each Adjustable Rate Mortgage Loan and
any Adjustment Date therefor, a number of percentage points per annum that
is
set forth in the related Mortgage Loan Schedule and in the related Mortgage
Note, which is the maximum amount by which the Mortgage Interest Rate for such
Mortgage Loan may increase (without regard to the Maximum Mortgage Interest
Rate) or decrease (without regard to the Minimum Mortgage Interest Rate) on
such
Adjustment Date from the Mortgage Interest Rate in effect immediately prior
to
such Adjustment Date, which may be a different amount with respect to the first
Adjustment Date.
Person: Any
individual, corporation, partnership, joint venture, association, limited
liability company, joint-stock company, trust, unincorporated organization
or
government or any agency or political subdivision thereof.
Prepayment
Interest Shortfall: As to any Remittance Date and Principal
Prepayment in full, the difference between (i) one full month’s interest at the
applicable Mortgage Interest Rate (after giving effect to any applicable relief
act reduction, debt service reduction and deficient valuation), as reduced
by
the Servicing Fee Rate, on the outstanding principal balance of the related
Mortgage Loan immediately prior to such Principal Prepayment and (ii) the amount
of interest actually received with respect to such Mortgage Loan in connection
with such Principal Prepayment.
Primary
Mortgage Insurance Policy: Each policy of primary mortgage
insurance represented to be in effect pursuant to Section 3.02(bb), or any
replacement policy therefor obtained by the Seller pursuant to Section
4.08.
Prime
Rate: The prime rate announced to be in effect from time to time
as published as the average rate in The Wall Street Journal (Northeast
Edition).
Principal
Prepayment: Any full or partial payment or other recovery of
principal on a Mortgage Loan which is received in advance of its scheduled
Due
Date, including any prepayment penalty or premium thereon and which is not
accompanied by an amount of interest representing scheduled interest due on
any
date or dates in any month or months subsequent to the month of
prepayment.
Purchase
Price: As defined in Section 2.02.
Purchase
Price and Terms Letter: As defined in the Recitals to this Agreement which
may also be a form of trade execution notice.
Purchaser:
EMC Mortgage Corporation, its successors in interest and assigns.
Qualified
Appraiser: With respect to each Mortgage Loan, an appraiser, duly
appointed by the Seller, who had no interest, direct or indirect in the
Mortgaged Property or in any loan made on the security thereof, and whose
compensation is not affected by the approval or disapproval of the Mortgage
Loan, and such appraiser and the appraisal made by such appraiser both satisfy
the requirements of ▇▇▇▇▇▇ ▇▇▇ and Title XI of FIRREA and the regulations
promulgated thereunder, all as in effect on the date the Mortgage Loan was
originated.
Qualified
Insurer: An insurance company duly qualified as such under the
laws of the states in which the Mortgaged Properties are located, duly
authorized and licensed in such states to transact the applicable insurance
business and to write the insurance provided by the insurance policy issued
by
it, approved as an insurer by ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac.
Rating
Agencies: Standard & Poor’s Ratings Services, a division of The ▇▇▇▇▇▇-
▇▇▇▇ Companies, Inc., ▇▇▇▇▇’▇ Investors Service, Inc. or, in the event that some
or all ownership of the Mortgage Loans is evidenced by mortgage-backed
securities, the nationally recognized rating agencies issuing ratings with
respect to such securities, if any.
Refinanced
Mortgage Loan: A Mortgage Loan which was made to a Mortgagor who
owned the Mortgaged Property prior to the origination of such Mortgage Loan
and
the proceeds of which were used in whole or part to satisfy an existing
mortgage.
REMIC: A
“real estate mortgage investment conduit” within the meaning of Section 860D of
the Code.
REMIC
Provisions: The provisions of the federal income tax law relating
to REMICs, which appear at Sections 860A through 860G of the Code, and the
related provisions and regulations promulgated thereunder, as the foregoing
may
be in effect from time to time.
Remittance
Date: The 18th day of each month, beginning with the First
Remittance Date, or if such day is not a Business Day, the first Business Day
immediately preceding such 18th day.
REO
Disposition: The final sale by the Seller of any REO
Property.
REO
Disposition Proceeds: Amounts received by the Seller in
connection with an REO Disposition.
REO
Property: A Mortgaged Property acquired by or on behalf of the
Purchaser in full or partial satisfaction of the related Mortgage as described
in Section 4.13.
Repurchase
Price: With respect to any Mortgage Loan, a price equal to (i) in
the event such Mortgage Loan is required to be repurchased during the period
(A)
from the related Closing Date to the closing date for any related Pass-Through
Transfer or Whole Loan Transfer, the greater of 100% or the percentage of par
as
stated in the related Purchase Price and Terms Letter multiplied by the
outstanding principal balance of the Mortgage Loan or (B) after the closing
date
for any related Pass-Through Transfer or Whole Loan Transfer, 100% multiplied
by
the outstanding principal balance of the Mortgage Loan, plus (ii)
interest on such outstanding principal balance at the related Mortgage Loan
Remittance Rate from the date through which interest was last distributed to
the
Purchaser (from payments from the related Mortgagor or from Monthly Advances)
through the day prior to the date of repurchase, less (iii) amounts
received or advanced in respect of such repurchased Mortgage Loan which are
being held in the Custodial Account for distribution in connection with such
Mortgage Loan.
SAIF: The
Savings Association Insurance Fund, or any successor thereto.
Security
Agreement: With respect to a Co-op Loan, the agreement or
mortgage creating a security interest in favor of the originator of the Co-op
Loan in the related Co-op Stock.
Scheduled
Principal Balance: As to each Mortgage Loan and any date of
determination, (i) the principal balance of such Mortgage Loan as of the related
Cut-off Date after giving effect to payments of principal due on or before
such
date, whether or not received, minus (ii) all amounts previously distributed
to
the Purchaser with respect to the Mortgage Loan representing payments or
recoveries of principal (or advances in lieu thereof).
Servicing
Advances: All customary, reasonable and necessary “out of pocket”
costs and expenses (including reasonable attorneys’ fees and disbursements)
incurred in the performance by the Seller of its servicing obligations,
including, but not limited to, the cost of (a) the preservation, restoration
and
protection of a Mortgaged Property, (b) any enforcement, administrative or
judicial proceedings, or any legal work or advice specifically related to
servicing the Mortgage Loans, including but not limited to, foreclosures,
bankruptcies, condemnations, drug seizures, elections, foreclosures by
subordinate or superior lienholders, and other legal actions incidental to
the
servicing of the Mortgage Loans (provided that such expenses are reasonable
and
that the Seller specifies the Mortgage Loan(s) to which such expenses relate,
and provided further that any such enforcement, administrative or judicial
proceeding does not arise out of a breach of any representation, warranty or
covenant of the Seller hereunder), (c) the management and liquidation of any
REO
Property, (d) taxes, assessments, water rates, sewer rates and other charges
which are or may become a lien upon the Mortgaged Property, and Primary Mortgage
Insurance Policy premiums and fire and hazard insurance coverage, (e) any
expenses reasonably sustained by the Seller with respect to the liquidation
of
the Mortgaged Property in accordance with the terms of this Agreement and (f)
compliance with the obligations under Section 4.08.
Servicing
Fee: As to each Mortgage Loan Package, the amount of the fee the
Purchaser shall pay to the Seller for servicing the Mortgage Loans in accordance
with the terms of this Agreement, which shall, with respect to each Mortgage
Loan, for a period of one full month, be equal to one-twelfth of the product
of
(i) the Servicing Fee Rate and (ii) the Scheduled Principal Balance of such
Mortgage Loan as of the first day of the month for which such fee is being
calculated.
Servicing
Fee Rate: The per annum rate at which the Servicing Fee accrues,
which rate with respect to each Mortgage Loan shall be as set forth in the
related Purchase Price and Terms Letter.
Servicing
File: With respect to each Mortgage Loan, the documents
pertaining thereto specified in Exhibit A-2 and copies of all documents
for such Mortgage Loan specified in Exhibit A-1.
Servicing
Officer: Any officer of the Seller involved in, or responsible
for, the administration and servicing of the Mortgage Loans whose name appears
on a list of servicing officers furnished by the Seller to the Purchaser upon
request, as such list may from time to time be amended.
Underwriting
Standards: As to each Mortgage Loan, the Seller’s underwriting
guidelines in effect as of the date of origination of such Mortgage
Loan.
Whole
Loan Transfer: As defined in Section 10.01(a)(i).
ARTICLE
II
SERVICING
OF MORTGAGE LOANS; RECORD TITLE AND POSSESSION OF MORTGAGE FILES; BOOKS AND
RECORDS; CUSTODIAL AGREEMENT; DELIVERY OF MORTGAGE LOAN
DOCUMENTS
Section
2.01. Agreement
to Purchase.
The
Seller agrees to sell and the Purchaser agrees to purchase on each Closing
Date,
pursuant to this Agreement and the related Purchase Price and Terms Letter,
the
Mortgage Loans being sold by the Seller and listed on the related Mortgage
Loan
Schedule, servicing rights retained, having an aggregate Scheduled Principal
Balance in an amount as set forth in the related Purchase Price and Terms
Letter, or in such other amount as agreed by the Purchaser and the Seller as
evidenced by the actual aggregate principal balance of the Mortgage Loans
accepted by the Purchaser on such Closing Date. The Seller shall
deliver in an electronic format the Mortgage Loan Schedule for the Mortgage
Loans to be purchased on such Closing Date to the Purchaser at least two (2)
Business Days prior to such Closing Date.
Section
2.02. Purchase
Price.
The
Purchase Price for the Mortgage Loans in a Mortgage Loan Package shall be equal
to the sum of (a) the percentage of par as stated in the related Purchase Price
and Terms Letter (subject to adjustment as provided therein), multiplied by
the
aggregate Scheduled Principal Balance of Mortgage Loans as of the related
Cut-off Date listed on the related Mortgage Loan Schedule plus (b)
accrued interest on the aggregate Scheduled Principal Balance of the related
Mortgage Loans at the weighted average Mortgage Loan Remittance Rate of such
Mortgage Loans from the related Cut-off Date to but not including such Closing
Date (the “Purchase Price”). If so provided in the related Purchase Price
and Terms Letter, portions of each Mortgage Loan Package shall be priced
separately.
The
Purchase Price as set forth in the preceding paragraph for the Mortgage Loans
in
a Mortgage Loan Package shall be paid on the related Closing Date by wire
transfer of immediately available funds.
With
respect to each Mortgage Loan, the Purchaser shall be entitled to (1) the
principal portion of all Monthly Payments due after the related Cut-off Date,
(2) all other recoveries of principal collected on or after the related Cut-off
Date (provided, however, that the principal portion of all Monthly Payments
due
on or before the related Cut-off Date and collected by the Seller or any
successor servicer after the related Cut-off Date shall belong to the Seller),
and (3) all payments of interest on the Mortgage Loans at the related Mortgage
Loan Remittance Rate (minus that portion of any such payment which is allocable
to the period prior to the related Cut-off Date). The Scheduled
Principal Balance of each Mortgage Loan as of the related Cut-off Date is
determined after application of payments of principal due on or before the
related Cut-off Date whether or not collected, together with any unscheduled
Principal Prepayments collected prior to the related Cut-off Date; provided,
however, that Monthly Payments for a Due Date beyond the related Cut-off
Date shall not be applied to the principal balance as of the related Cut-off
Date. Such Monthly Payments shall be the property of the
Purchaser. The Seller shall deposit any such Monthly Payments into
the Custodial Account.
Section
2.03. Servicing
of Mortgage Loans.
On
each
Closing Date, the Mortgage Loans in the related Mortgage Loan Package will
be
sold by the Seller to the Purchaser on a servicing retained basis upon the
execution and delivery of an Assignment and Conveyance in the form attached
hereto as Exhibit E (the “Assignment and
Conveyance”).
Simultaneously
with the execution and delivery of the related Assignment and Conveyance, for
each Mortgage Loan Package, the Seller hereby agrees to service the Mortgage
Loans listed on the Mortgage Loan Schedule in accordance with Accepted Servicing
Practices and this Agreement. The rights of the Purchaser to receive payments
with respect to the related Mortgage Loans shall be as set forth in this
Agreement.
Section
2.04. Record
Title and Possession of Mortgage Files; Maintenance of Servicing
Files.
As
of
each Closing Date, the Seller will have sold, transferred, assigned, set over
and conveyed to the Purchaser, without recourse, and the Seller hereby
acknowledges that the Purchaser will have, all the right, title and interest
of
the Seller in and to the Mortgage Loans. In accordance with Section
2.07, the Seller shall deliver at its own expense, the Mortgage Files for the
related Mortgage Loans to Purchaser or its designee. The possession
of each Servicing File by the Seller is for the sole purpose of servicing the
related Mortgage Loan. From each Closing Date, the ownership of each
related Mortgage Loan, including the Mortgage Note, the Mortgage, the contents
of the related Mortgage File and all rights, benefits, proceeds and obligations
arising therefrom or in connection therewith, has been vested in the
Purchaser. All rights arising out of the Mortgage Loans including,
but not limited to, all funds received on or in connection with the Mortgage
Loans and all records or documents with respect to the Mortgage Loans prepared
by or which come into the possession of the Seller shall be received and held
by
the Seller in trust for the benefit of the Purchaser as the owner of the
Mortgage Loans. Any portion of the Mortgage Files retained by the
Seller shall be appropriately identified in the Seller’s computer system to
clearly reflect the ownership of the Mortgage Loans by the
Purchaser.
In
addition, in connection with the assignment of any MERS Mortgage Loan, the
Seller agrees that it will cause, at its own expense, the MERS® System to
indicate that such Mortgage Loans have been assigned by the Seller to the
Purchaser in accordance with this Agreement by including (or deleting, in the
case of Mortgage Loans which are repurchased in accordance with this Agreement)
in such computer files the information required by the MERS® System to identify
the Purchaser of such Mortgage Loans. The Seller further agrees that
it will not alter the information referenced in this paragraph with respect
to
any Mortgage Loan during the term of this Agreement unless and until such
Mortgage Loan is repurchased in accordance with the terms of this
Agreement.
Section
2.05. Books
and Records.
The
sale
of each Mortgage Loan will be reflected on the Seller’s balance sheet and other
financial statements as a sale of assets by the Seller and will be reflected
on
the Purchaser’s balance sheet and other financial statements as a purchase by
the Purchaser. The Seller shall maintain, a complete set of books and
records for the Mortgage Loans sold by it which shall be appropriately
identified in the Seller’s computer system to clearly reflect the ownership of
the Mortgage Loans by the Purchaser. In particular, the Seller shall
maintain in its possession, available for inspection by the Purchaser, or its
designee and shall deliver to the Purchaser upon demand, evidence of compliance
with all federal, state and local laws, rules and regulations, and requirements
of ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, as applicable, including but not limited to
documentation as to the method used in determining the applicability of the
provisions of the Flood Disaster Protection Act of 1973, as amended, to the
Mortgaged Property, documentation evidencing insurance coverage and eligibility
of any condominium project for approval by Seller and periodic inspection
reports as required by Section 4.13. To the extent that original
documents are not required for purposes of realization of Liquidation Proceeds
or Insurance Proceeds, documents maintained by the Seller may be in the form
of
microfilm or microfiche or such other reliable means of recreating original
documents, including but not limited to, optical imagery techniques so long
as
the Seller complies with the requirements of the ▇▇▇▇▇▇ Mae Guides.
Section
2.06. Transfer
of Mortgage Loans.
The
Seller shall keep at its office books and records in which, subject to such
reasonable regulations as it may prescribe, the Seller shall note transfers
of
Mortgage Loans. No transfer of a Mortgage Loan may be made unless
such transfer is in compliance with the terms of Section 11.12. For
the purposes of this Agreement, the Seller shall be under no obligation to
deal
with any person with respect to this Agreement or any Mortgage Loan unless
a
properly executed Assignment, Assumption and Recognition Agreement in the form
of Exhibit D with respect to such Mortgage Loan has been delivered to the
Seller; provided, that, unless otherwise provided in the related Purchase Price
and Terms Letter, in no event shall there be more than five (5) “Purchasers”
with respect to any Mortgage Loan Package. Upon receipt of notice of
the transfer, the Seller shall ▇▇▇▇ its books and records to reflect the
ownership of the Mortgage Loans by such assignee, and, except as otherwise
provided herein, the previous Purchaser shall be released from its obligations
hereunder with respect to the Mortgage Loans sold or transferred.
Section
2.07. Delivery
of Mortgage Loan Documents.
The
Seller shall deliver and release to the Purchaser or its designee the Mortgage
Loan Documents no later than four (4) Business Days prior to the related Closing
Date pursuant to a bailee letter agreement. If the Seller cannot deliver the
original recorded Mortgage Loan Documents on the related Closing Date, the
Seller shall, promptly upon receipt thereof and in any case not later than
270
days from the related Closing Date, deliver such original recorded documents
to
the Purchaser or its designee (unless the Seller is delayed in making such
delivery by reason of the fact that such documents shall not have been returned
by the appropriate recording office). If delivery is not completed
within 270 days of the related Closing Date solely because such documents shall
not have been returned by the appropriate recording office, the Seller shall
notify the Purchaser of the same and indicate in such notice the approximate
date on which such documents shall be delivered. The Seller shall
provide the Purchaser with updated reports as to the status of such documents
as
necessary thereafter. The Seller shall use its best efforts to effect
delivery of all delayed recorded documents within 360 days of the related
Closing Date; provided, however, that if such documents are not delivered by
the
360th day from the related Closing Date, the Seller shall, at Purchaser’s
request, repurchase the related Mortgage Loans at the Repurchase Price in
accordance with Section 3.03 hereof.
No
later
than three (3) days prior to the related Closing Date, the Seller shall provide
a copy of the commitment for title insurance to the Purchaser or its
designee.
Any
review by the Purchaser or its designee of the Mortgage Files shall in no way
alter or reduce the Seller’s obligations hereunder.
The
Seller shall forward to the Purchaser, or its designee, original documents
evidencing an assumption, modification, consolidation or extension of any
Mortgage Loan entered into in accordance with Section 4.01 or 6.01 within two
(2) weeks of their execution and shall also provide the original of any document
submitted for recordation or a copy of such document certified by the
appropriate public recording office to be a true and complete copy of the
original within two (2) weeks of its return from the appropriate public
recording office.
Section
2.08. Quality
Control Procedures.
The
Seller shall have an internal quality control program that verifies, on a
regular basis, the existence and accuracy of the legal documents, credit
documents, property appraisals, and underwriting decisions. The
program must be capable of evaluating and monitoring the overall quality of
its
loan production and servicing activities. The program is to ensure
that the Mortgage Loans are originated and serviced in accordance with prudent
mortgage banking practices and accounting principles; guard against dishonest,
fraudulent, or negligent acts; and guard against errors and omissions by
officers, employees, or other authorized persons.
Section
2.09. Closing.
The
closing for the purchase and sale of the Mortgage Loans shall take place on
the
related Closing Date. The closing shall be either: by
telephone, confirmed by letter or wire as the parties shall agree, or conducted
in person, at such place as the parties shall agree.
The
closing for the Mortgage Loans to be purchased on the related Closing Date
shall
be subject to each of the following conditions:
(a) at
least
two (2) Business Days prior to the related Closing Date, the Seller shall
deliver to the Purchaser a magnetic diskette, or transmit by modem or e-mail,
a
listing on a loan-level basis of the information contained in the Mortgage
Loan
Schedule;
(b) all
of
the representations and warranties of the Seller and the Purchaser under this
Agreement shall be materially true and correct as of the related Closing Date
or, with respect to representations and warranties made as of a date other
than
the related Closing Date, as of such date, and no event shall have occurred
which, with notice or the passage of time, would constitute a material default
under this Agreement;
(c) the
Purchaser shall have received, or the Purchaser’s attorneys shall have received
in escrow, all closing documents, in such forms as are agreed upon and
acceptable to the Purchaser, duly executed by all signatories other than the
Purchaser as required pursuant to the terms hereof;
(d) the
Seller shall have received, or the Seller’s attorneys shall have received in
escrow, all closing documents, in such forms as are agreed upon and acceptable
to the Seller, duly executed by all signatories other than the Seller as
required pursuant to the terms hereof;
(e) the
Seller shall have delivered and released to the Purchaser (or its designee)
on
or prior to the related Closing Date all documents required to be delivered
and
released pursuant to the terms of this Agreement; and
(f) all
other
terms and conditions of this Agreement, the related Purchase Price and Terms
Letter and the related Assignment and Conveyance shall have been materially
complied with.
Subject
to the foregoing conditions, the Purchaser shall pay to the Seller on the
related Closing Date the Purchase Price pursuant to Section 2.02 of this
Agreement, by wire transfer of immediately available funds to the account
designated by the Seller.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES OF THE SELLER; REPURCHASE; REVIEW OF MORTGAGE
LOANS
Section
3.01. Representations
and Warranties of the Seller.
The
Seller represents, warrants and covenants to the Purchaser that as of each
Closing Date or as of such date specifically provided herein:
(a) The
Seller is a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation and has all licenses
necessary to carry out its business as now being conducted, and is licensed
and
qualified to transact business in and is in good standing under the laws of
each
state in which any Mortgaged Property is located or is otherwise exempt under
applicable law from such licensing or qualification or is otherwise not required
under applicable law to effect such licensing or qualification and no demand
for
such licensing or qualification has been made upon the Seller by any such state,
and in any event the Seller is in compliance with the laws of any such state
to
the extent necessary to ensure the enforceability of each Mortgage Loan and
the
servicing of the Mortgage Loans in accordance with the terms of this
Agreement;
(b) The
Seller has the full power and authority and legal right to hold, transfer and
convey each Mortgage Loan, to sell each Mortgage Loan and to execute, deliver
and perform, and to enter into and consummate all transactions contemplated
by
this Agreement, the related Purchase Price and Terms Letter and the related
Assignment and Conveyance and to conduct its business as presently conducted;
the Seller has duly authorized the execution, delivery and performance of this
Agreement and any agreements contemplated hereby, has duly executed and
delivered this Agreement, the related Purchase Price and Terms Letter and the
related Assignment and Conveyance, and any agreements contemplated hereby,
and
this Agreement, the related Purchase Price and Terms Letter, the related
Assignment and Conveyance and each Assignment of Mortgage to the Purchaser
and
any agreements contemplated hereby, constitute the legal, valid and binding
obligations of the Seller, enforceable against it in accordance with their
respective terms, except as such enforceability may be limited by bankruptcy,
insolvency, moratorium, reorganization and similar laws, and by equitable
principles affecting the enforceability of the rights of creditors; and all
requisite corporate action has been taken by the Seller to make this Agreement,
the related Purchase Price and Terms Letter, the related Assignment and
Conveyance and all agreements contemplated hereby valid and binding upon the
Seller in accordance with their respective terms;
(c) None
of
the execution and delivery of this Agreement, the related Purchase Price and
Terms Letter, the related Assignment and Conveyance, the sale of the Mortgage
Loans to the Purchaser, the consummation of the transactions contemplated
hereby, or the fulfillment of or compliance with the terms and conditions of
this Agreement, the related Purchase Price and Terms Letter or the related
Assignment and Conveyance will conflict with any of the terms, conditions or
provisions of the Seller’s charter or by-laws or materially conflict with or
result in a material breach of any of the terms, conditions or provisions of
any
legal restriction or any material agreement or instrument to which the Seller
is
now a party or by which it is bound, or constitute a default or result in an
acceleration under any of the foregoing, or result in the material violation
of
any law, rule, regulation, order, judgment or decree to which the Seller or
its
property is subject;
(d) There
is
no litigation, suit, proceeding or investigation pending or, to the Seller’s
knowledge, threatened, or any order or decree outstanding, which is reasonably
likely to have a material adverse effect on the sale of the Mortgage Loans,
the
execution, delivery, performance or enforceability of this Agreement, the
related Purchase Price and Terms Letter or the related Assignment and
Conveyance, or which is reasonably likely to have a material adverse effect
on
the financial condition of the Seller;
(e) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Seller
of or
compliance by the Seller with this Agreement, the related Purchase Price and
Terms Letter and the related Assignment and Conveyance, except for consents,
approvals, authorizations and orders which have been obtained;
(f) The
consummation of the transactions contemplated by this Agreement, the related
Purchase Price and Terms Letter and the related Assignment and Conveyance are
in
the ordinary course of business of the Seller, and the transfer, assignment
and
conveyance of the Mortgage Notes and the Mortgages by the Seller pursuant to
this Agreement, the related Purchase Price and Terms Letter and the related
Assignment and Conveyance are not subject to bulk transfer or any similar
statutory provisions in effect in any applicable jurisdiction;
(g) The
Seller has not used selection procedures that identified the Mortgage Loans
as
being less desirable or valuable than other comparable mortgage loans in the
Seller’s portfolio at the Cut-off Date;
(h) The
Seller will treat the sale of the Mortgage Loans to the Purchaser as a sale
for
reporting and accounting purposes and, to the extent appropriate, for federal
income tax purposes;
(i) The
Seller is an approved seller/servicer of residential mortgage loans for ▇▇▇▇▇▇
Mae or ▇▇▇▇▇▇▇ Mac and HUD, with such facilities, procedures and personnel
necessary for the sound servicing of such mortgage loans. The Seller
is duly qualified, licensed, registered and otherwise authorized under all
applicable federal, state and local laws and regulations, meets the minimum
capital requirements, if applicable, set forth by the OCC, and is in good
standing to sell mortgage loans to and service mortgage loans for ▇▇▇▇▇▇ Mae
or
▇▇▇▇▇▇▇ Mac and no event has occurred which would make the Seller unable to
comply with eligibility requirements or which would require notification to
either ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac;
(j) The
Seller does not believe, nor does it have any cause or reason to believe, that
it cannot perform each and every covenant contained in this Agreement and the
related Purchase Price and Terms Letter. The Seller is solvent and the sale
of
the Mortgage Loans will not cause the Seller to become insolvent. The
sale of the Mortgage Loans is not undertaken with the intent to hinder, delay
or
defraud any of the Seller’s creditors;
(k) No
statement, tape, diskette, form, report or other document prepared by, or on
behalf of, the Seller pursuant to this Agreement, the related Purchase Price
and
Terms Letter or in connection with the transactions contemplated hereby,
contains or will contain any statement that is or will be inaccurate or
misleading in any material respect;
(l) The
Seller acknowledges and agrees that the Servicing Fee represents reasonable
compensation for performing such services and that the entire Servicing Fee
shall be treated by the Seller, for accounting and tax purposes, as compensation
for the servicing and administration of the Mortgage Loans pursuant to this
Agreement;
(m) The
Seller has delivered to the Purchaser financial statements as to its last two
complete fiscal years for which financial statements are
available. All such financial statements fairly present the pertinent
results of operations and changes in financial position for each of such periods
and the financial position at the end of each such period of the Seller and
its
subsidiaries and have been prepared in accordance with GAAP consistently applied
throughout the periods involved, except as set forth in the notes
thereto. There has been no change in the business, operations,
financial condition, properties or assets of the Seller since the date of the
Seller’s financial statements that would have a material adverse effect on its
ability to perform its obligations under this Agreement, the related Purchase
Price and Terms Letter or the related Assignment and Conveyance;
(n) The
Seller has not dealt with any broker, investment banker, agent or other person
that may be entitled to any commission or compensation in connection with the
sale of the Mortgage Loans; and
(o) The
Seller is a member of MERS in good standing, and will comply in all material
respects with the rules and procedures of MERS in connection with the servicing
of the MERS Mortgage Loans for as long as such Mortgage Loans are registered
with MERS.
Section
3.02. Representations
and Warranties as to Individual Mortgage Loans.
The
Seller hereby represents and warrants to the Purchaser, as to each Mortgage
Loan, as of the related Closing Date as follows:
(a) The
information set forth in the Mortgage Loan Schedule, including any diskette
or
other related data tapes delivered to the Purchaser, is complete, true and
correct in all material respects as of the related Cut-off Date;
(b) With
respect to a first lien Mortgage Loan that is not a Co-op Loan, the Mortgage
creates a first lien or a first priority ownership interest in an estate in
fee
simple in real property securing the related Mortgage Note. With
respect to a first lien Mortgage Loan that is a Co-op Loan, the Mortgage creates
a first lien or a first priority ownership interest in the stock ownership
and
leasehold rights associated with the cooperative unit securing the related
Mortgage Note;
(c) With
respect to a second lien Mortgage Loan that is not a Co-op Loan, the Mortgage
creates a second lien or a second priority ownership interest in an estate
in
fee simple in real property securing the related Mortgage Note. With respect
to
a second lien Mortgage Loan that is a Co-op Loan, the Mortgage creates a second
lien or a second priority ownership interest in the stock ownership and
leasehold rights associated with the cooperative unit securing the related
Mortgage Note;
(d) All
payments due on or prior to the related Cut-off Date for such Mortgage Loan
have
been made as of the related Closing Date, the Mortgage Loan is not delinquent
thirty (30) days or more in payment and has not been dishonored; there are
no
material defaults under the terms of the Mortgage Loan; the Seller has not
advanced funds, or induced, solicited or knowingly received any advance of
funds
from a party other than the owner of the Mortgaged Property subject to the
Mortgage, directly or indirectly, for the payment of any amount required by
the
Mortgage Loan; as to each Mortgage Loan, there has been no thirty (30) day
delinquency during the immediately preceding twelve-month period;
(e) All
taxes, governmental assessments, insurance premiums, water, sewer and municipal
charges, leasehold payments or ground rents which previously became due and
owing have been paid, or escrow funds have been established in an amount
sufficient to pay for every such escrowed item which remains unpaid and which
has been assessed but is not yet due and payable;
(f) The
terms
of the Mortgage Note and the Mortgage have not been impaired, waived, altered
or
modified in any respect, except by written instruments which have been recorded
to the extent any such recordation is required by law, or, necessary to protect
the interest of the Purchaser. No instrument of waiver, alteration or
modification has been executed in connection with such Mortgage Loan, and no
Mortgagor has been released, in whole or in part, from the terms thereof except
in connection with an assumption agreement and which assumption agreement is
part of the Mortgage File and the terms of which are reflected in the Mortgage
Loan Schedule; the substance of any such waiver, alteration or modification
has
been approved by the issuer of any related Primary Mortgage Insurance Policy
and
title insurance policy, to the extent required by the related
policies;
(g) The
Mortgage Note and the Mortgage are not subject to any right of rescission,
set-off, counterclaim or defense, including, without limitation, the defense
of
usury, nor will the operation of any of the terms of the Mortgage Note or the
Mortgage, or the exercise of any right thereunder, render the Mortgage Note
or
Mortgage unenforceable, in whole or in part, or subject to any right of
rescission, set-off, counterclaim or defense, including the defense of usury,
and no such right of rescission, set-off, counterclaim or defense has been
asserted with respect thereto;
(h) All
buildings or other customarily insured improvements upon the Mortgaged Property
are insured by an insurer acceptable under the ▇▇▇▇▇▇ Mae Guides, against loss
by fire, hazards of extended coverage and such other hazards as are provided
for
in the ▇▇▇▇▇▇ ▇▇▇ Guides or by ▇▇▇▇▇▇▇ Mac, as well as all additional
requirements set forth in Section 4.10 of this Agreement. All such standard
hazard policies are in full force and effect and on the date of origination
contained a standard mortgagee clause naming the Seller and its successors
in
interest and assigns as loss payee and such clause is still in effect and all
premiums due thereon have been paid. If required by the Flood
Disaster Protection Act of 1973, as amended, the Mortgage Loan is covered by
a
flood insurance policy meeting the requirements of the current guidelines of
the
Federal Insurance Administration which policy conforms to ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇
Mac requirements, as well as all additional requirements set forth in Section
4.10 of this Agreement. Such policy was issued by an insurer
acceptable under ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac guidelines. The Mortgage
obligates the Mortgagor thereunder to maintain all such insurance at the
Mortgagor’s cost and expense, and upon the Mortgagor’s failure to do so,
authorizes the holder of the Mortgage to maintain such insurance at the
Mortgagor’s cost and expense and to seek reimbursement therefor from the
Mortgagor;
(i) Any
and
all requirements of any federal, state or local law including, without
limitation, usury, truth-in-lending, real estate settlement procedures, consumer
credit protection, equal credit opportunity or disclosure laws applicable to
the
Mortgage Loan have been complied with in all material respects;
(j) The
Mortgage has not been satisfied, canceled or subordinated, in whole or in part,
or rescinded, and the Mortgaged Property has not been released from the lien
of
the Mortgage, in whole or in part nor has any instrument been executed that
would effect any such release, cancellation, subordination or rescission. The
Seller has not waived the performance by the Mortgagor of any action, if the
Mortgagor’s failure to perform such action would cause the Mortgage Loan to be
in default, nor has the Seller waived any default resulting from any action
or
inaction by the Mortgagor;
(k) With
respect to any first lien Mortgage Loan, the related Mortgage is a valid,
subsisting, enforceable and perfected first lien on the Mortgaged Property
and,
with respect to any second lien Mortgage Loan, the related Mortgage is a valid,
subsisting, enforceable and perfected second lien on the Mortgaged Property,
including for Mortgage Loans that are not Co-op Loans, all buildings on the
Mortgaged Property and all installations and mechanical, electrical, plumbing,
heating and air conditioning systems affixed to such buildings, and all
additions, alterations and replacements made at any time with respect to the
foregoing securing the Mortgage Note’s original principal
balance. The Mortgage and the Mortgage Note do not contain any
evidence of any security interest or other interest or right
thereto. Such lien is free and clear of all adverse claims, liens and
encumbrances having priority over the first or second lien, as applicable,
of
the Mortgage subject only to (1) with respect to any second lien Mortgage Loan,
the related First Lien, (2) the lien of non-delinquent current real property
taxes and assessments not yet due and payable, (3) covenants, conditions and
restrictions, rights of way, easements and other matters of the public record
as
of the date of recording which are acceptable to mortgage lending institutions
generally and either (A) which are referred to or otherwise considered in the
appraisal made for the originator of the Mortgage Loan, or (B) which do not
adversely affect the appraised value of the Mortgaged Property as set forth
in
such appraisal, and (4) other matters to which like properties are commonly
subject which do not materially interfere with the benefits of the security
intended to be provided by the Mortgage or the use, enjoyment, value or
marketability of the related Mortgaged Property. Any security
agreement, chattel mortgage or equivalent document related to and delivered
in
connection with the Mortgage Loan establishes and creates (1) with respect
to
any first lien Mortgage Loan, a valid, subsisting, enforceable and perfected
first lien and first priority security interest and (2) with respect to any
second lien Mortgage Loan, a valid, subsisting, enforceable and perfected second
lien and second priority security interest, in each case, on the property
described therein, and the Seller has the full right to sell and assign the
same
to the Purchaser;
(l) The
Mortgage Note and the related Mortgage are original and genuine and each is
the
legal, valid and binding obligation of the maker thereof, enforceable in all
respects in accordance with its terms, except as such enforcement may be limited
by bankruptcy, insolvency, moratorium, reorganization and other laws of general
application affecting the rights of creditors generally and the equitable remedy
of specific performance and by general equitable principles. All
parties to the Mortgage Note and the related Mortgage had the legal capacity
to
enter into the Mortgage Loan and to execute and deliver the Mortgage Note and
the related Mortgage. The Mortgage Note and the related Mortgage have
been duly and properly executed by such parties. To the Seller’s
knowledge, no fraud, error, omission, misrepresentation, negligence or similar
occurrence with respect to a Mortgage Loan has taken place on the part of
Seller, the Mortgagor or any other party involved in the origination of the
Mortgage Loan. The proceeds of the Mortgage Loan have been fully
disbursed and there is no requirement for future advances thereunder, and any
and all requirements as to completion of any on-site or off-site improvements
and as to disbursements of any escrow funds therefor have been complied
with. All costs, fees and expenses incurred in making or closing the
Mortgage Loan and the recording of the Mortgage were paid or are in the process
of being paid, and the Mortgagor is not entitled to any refund of any amounts
paid or due under the Mortgage Note or related Mortgage;
(m) Except
with respect to MERS Mortgage Loans, the Seller or its affiliate is the sole
owner of record and holder of the Mortgage Loan and the indebtedness evidenced
by the Mortgage Note, and upon recordation the Purchaser or its designee will
be
the owner of record of the Mortgage and the indebtedness evidenced by the
Mortgage Note, and upon the sale of the Mortgage Loan to the Purchaser, the
Seller will retain the Servicing File in trust for the Purchaser only for the
purpose of servicing and supervising the servicing of the Mortgage
Loan. Immediately prior to the transfer and assignment to the
Purchaser on the related Closing Date, the Mortgage Loan, including the Mortgage
Note and the Mortgage, were not subject to an assignment or pledge, and the
Seller had good and marketable title to and was the sole owner thereof and
had
full right to transfer and sell the Mortgage Loan to the Purchaser free and
clear of any encumbrance, equity, lien, pledge, charge, claim or security
interest and has the full right and authority subject to no interest or
participation of, or agreement with, any other party, to sell and assign the
Mortgage Loan pursuant to this Agreement and following the sale of the Mortgage
Loan, the Purchaser will own such Mortgage Loan free and clear of any
encumbrance, equity, participation interest, lien, pledge, charge, claim or
security interest. The Seller intends to relinquish all rights to
possess, control and monitor the Mortgage Loan, except for the purposes of
servicing the Mortgage Loan as set forth in this Agreement;
(n) Each
Mortgage Loan that is not a Co-op Loan is covered by an ALTA lender’s title
insurance policy or other generally acceptable form of policy or insurance
acceptable to ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac, issued by a title insurer acceptable
to
▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac and qualified to do business in the jurisdiction
where
the Mortgaged Property is located, insuring (subject to the exceptions contained
in (k)(1), (2), (3) and (4) above) the Seller, its successors and assigns,
as to
the first or second priority lien, as applicable, of the Mortgage in the
original principal amount of the Mortgage Loan. Where required by
applicable state law or regulation, the Mortgagor has been given the opportunity
to choose the carrier of the required mortgage title insurance. The
Seller, its successors and assigns, are the sole insureds of such lender’s title
insurance policy, such title insurance policy has been duly and validly endorsed
to the Purchaser or the assignment to the Purchaser of the Seller’s interest
therein does not require the consent of or notification to the insurer and
such
lender’s title insurance policy is in full force and effect and will be in full
force and effect upon the consummation of the transactions contemplated by
this
Agreement and the related Purchase Price and Terms Letter. No claims
have been made under such lender’s title insurance policy, and no prior holder
of the related Mortgage, including the Seller, has done, by act or omission,
anything which would impair the coverage of such lender’s title insurance
policy;
(o) There
is
no default, breach, violation or event of acceleration existing under the
Mortgage or the related Mortgage Note and no event which, with the passage
of
time or with notice and the expiration of any grace or cure period, would
constitute a default, breach, violation or event permitting acceleration; and
neither the Seller nor, any prior mortgagee has waived any default, breach,
violation or event permitting acceleration. With respect to each
second lien Mortgage Loan, (i) the First Lien is in full force and effect,
(ii)
there is no default, breach, violation or event of acceleration existing under
such prior mortgage or the related mortgage note, (iii) no event which, with
the
passage of time or with notice and the expiration of any grace or cure period,
would constitute a default, breach, violation or event of acceleration
thereunder, and either (A) the prior mortgage contains a provision which allows
or (B) applicable law requires, the mortgagee under the second lien Mortgage
Loan to receive notice of, and affords such mortgagee an opportunity to cure
any
default by payment in full or otherwise under the prior mortgage;
(p) There
are
no mechanics’ or similar liens or claims which have been filed for work, labor
or material (and no rights are outstanding that under law could give rise to
such liens) affecting the related Mortgaged Property which are or may be liens
prior to or equal to the lien of the related Mortgage, which are not insured
against by the title insurance policy referenced in paragraph (n)
above;
(q) All
improvements subject to the Mortgage which were considered in determining the
Appraised Value of the Mortgaged Property lie wholly within the boundaries
and
building restriction lines of the Mortgaged Property (and wholly within the
project with respect to a condominium unit) and no improvements on adjoining
properties encroach upon the Mortgaged Property except those which are insured
against by the title insurance policy referred to in clause (n) above and all
improvements on the property comply with all applicable zoning and subdivision
laws and ordinances;
(r) The
Mortgage Loan was originated by or for the Seller. The Mortgage Loan
complies with the terms, conditions and requirements of the Underwriting
Standards in all material respects. The Mortgage Notes and Mortgages
(exclusive of any riders) are on forms generally acceptable to ▇▇▇▇▇▇ ▇▇▇ or
▇▇▇▇▇▇▇ Mac. The Mortgage Loan bears interest at the Mortgage
Interest Rate set forth in the related Mortgage Loan Schedule, and Monthly
Payments under the Mortgage Note are due and payable on the first day of each
month. The Mortgage contains the usual and enforceable provisions of
the originator at the time of origination for the acceleration of the payment
of
the unpaid principal amount of the Mortgage Loan if the related Mortgaged
Property is sold without the prior consent of the mortgagee
thereunder;
(s) At
origination of the Mortgage Loan and as of each related Closing Date, the
related Mortgaged Property was free of material damage and waste. At
origination of the Mortgage Loan and as of each related Closing Date, there
was
no proceeding pending for the total or partial condemnation of the Mortgaged
Property;
(t) The
related Mortgage contains customary and enforceable provisions such as to render
the rights and remedies of the holder thereof adequate for the realization
against the Mortgaged Property of the benefits of the security provided
thereby. There is no homestead or other exemption available to the
Mortgagor which would interfere with the right to sell the Mortgaged Property
at
a trustee’s sale or the right to foreclose the Mortgage subject to applicable
federal and state laws and judicial precedent with respect to bankruptcy and
right of redemption;
(u) If
the
Mortgage constitutes a deed of trust, a trustee, authorized and duly qualified
if required under applicable law to act as such, has been properly designated
and currently so serves and is named in the Mortgage, and no fees or expenses,
except as may be required by local law, are or will become payable by the
Purchaser to the trustee under the deed of trust, except in connection with
a
trustee’s sale or attempted sale after default by the Mortgagor;
(v) If
required by the applicable processing style, the Mortgage File contains an
appraisal of the related Mortgaged Property signed prior to the final approval
of the mortgage loan application by a Qualified Appraiser. The
appraisal is in a form acceptable to ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac;
(w) All
parties which have had any interest in the Mortgage, whether as mortgagee,
assignee, pledgee or otherwise, are (or, during the period in which they held
and disposed of such interest, were) (A) in compliance with any and all
applicable licensing requirements of the laws of the state wherein the Mortgaged
Property is located, and (B) (1) organized under the laws of such state, or
(2)
qualified to do business in such state, or (3) federal savings and loan
associations or national banks or a Federal Home Loan Bank or savings bank
having principal offices in such state, or (4) not doing business in such
state;
(x) The
related Mortgage Note is not and has not been secured by any collateral except
the lien of the corresponding Mortgage and the security interest of any
applicable security agreement or chattel mortgage referred to in clause (k)
above and such collateral does not serve as security for any other
obligation;
(y) The
Mortgage Loan does not contain balloon or “graduated payment”
features; to the extent any Mortgage Loan contains any buydown
provision, such buydown funds have been maintained and administered in
accordance with, and such Mortgage Loan otherwise complies with, ▇▇▇▇▇▇ Mae
or
▇▇▇▇▇▇▇ Mac requirements relating to buydown loans;
(z) The
Mortgagor was not in bankruptcy or insolvent as of the date of origination
of
the Mortgage Loan or as of each related Closing Date;
(aa) Each
Fixed Rate Mortgage Loan has an original term to maturity of not more than
thirty (30) years, with interest calculated and payable in arrears on the first
day of each month in equal monthly installments of principal and
interest. Except with respect to Interest Only Mortgage Loans, each
Mortgage Note requires a monthly payment which is sufficient to fully amortize
the original principal balance of the Mortgage Loan fully by the stated maturity
date, over an original term of not more than thirty (30) years and to pay
interest at the related Mortgage Interest Rate; provided, however, in
the case of a balloon Mortgage Loan, the Mortgage Loan matures at least five
(5)
years after the first payment date thereby requiring a final payment of the
outstanding principal balance prior to the full amortization of the Mortgage
Loan. No Mortgage Loan contains terms or provisions which would
result in negative amortization;
(bb) If
a
Mortgage Loan has an LTV greater than 80%, the portion of the principal balance
of such Mortgage Loan in excess of the portion of the Appraisal Value of the
Mortgaged Property required by ▇▇▇▇▇▇ Mae, is and will be insured as to payment
defaults by a Primary Mortgage Insurance Policy issued by a Qualified
Insurer. All provisions of such Primary Mortgage Insurance Policy
have been and are being complied with, such policy is in full force and effect,
and all premiums due thereunder have been paid. No action, inaction,
or event has occurred and no state of facts exists that has, or will result
in
the exclusion from, denial of, or defense to coverage. Any Mortgage
Loan subject to a Primary Mortgage Insurance Policy obligates the Mortgagor
thereunder to maintain the Primary Mortgage Insurance Policy and to pay all
premiums and charges in connection therewith. The mortgage interest rate for
the
Mortgage Loan as set forth on the related Mortgage Loan Schedule is net of
any
such insurance premium;
(cc) The
Assignment of Mortgage is in recordable form and is acceptable for recording
under the laws of the jurisdiction in which the Mortgaged Property is
located;
(dd) As
to
Mortgage Loans that are not Co-op Loans and that are not secured by an interest
in a leasehold estate, the Mortgaged Property is located in the state identified
in the related Mortgage Loan Schedule and consists of a single parcel of real
property with a detached single family residence erected thereon, or a
townhouse, or a two-to four-family dwelling, or an individual condominium unit
in a condominium project, or an individual unit in a planned unit development
or
a de minimis planned unit development, provided, however, that no
residence or dwelling is a mobile home. As of the date of
origination, no portion of the Mortgaged Property was used for commercial
purposes, and, since the date of origination no portion of the Mortgaged
Property has been used for commercial purposes, except as permitted under the
Underwriting Standards;
(ee) Except
with respect to Interest Only Mortgage Loans, principal payments on the Mortgage
Loan commenced no more than sixty (60) days after the funds were disbursed
in
connection with such Mortgage Loan;
(ff) Unless
otherwise noted on the Mortgage Loan Schedule, no Mortgage Loan imposes a
prepayment penalty;
(gg) As
of the
date of origination of the Mortgage Loan, the Mortgaged Property was lawfully
occupied under applicable law, and all inspections, licenses and certificates
required to be made or issued with respect to all occupied portions of the
Mortgaged Property and, with respect to the use and occupancy of the same,
including but not limited to certificates of occupancy and fire underwriting
certificates, have been made or obtained from the appropriate
authorities;
(hh) If
the
Mortgaged Property is a condominium unit or a planned unit development (other
than a de minimis planned unit development), or stock in a cooperative housing
corporation, such condominium, cooperative or planned unit development project
meets the Seller’s eligibility requirements as set forth in Underwriting
Standards;
(ii) To
the
Seller’s knowledge, there is no pending action or proceeding directly involving
the Mortgaged Property in which compliance with any environmental law, rule
or
regulation is an issue and there is no violation of any environmental law,
rule
or regulation with respect to the Mortgaged Property. The Seller has
not received any notice of any environmental hazard on the Mortgaged
Property;
(jj) The
related Mortgagor has not notified the Seller, and the Seller has no knowledge
of any relief requested or allowed to the Mortgagor under the Servicemembers
Civil Relief Act;
(kk) No
action
has been taken or failed to be taken by the Seller on or prior to the related
Closing Date which has resulted or will result in an exclusion from, denial
of,
or defense to coverage under any Primary Mortgage Insurance Policy (including,
without limitation, any exclusions, denials or defenses which would limit or
reduce the availability of the timely payment of the full amount of the loss
otherwise due thereunder to the insured) whether arising out of actions,
representations, errors, omissions, negligence, or fraud of the Seller, or
for
any other reason under such coverage;
(ll) Each
Mortgage Loan has been serviced in all material respects in compliance with
Accepted Servicing Practices and applicable state and federal laws, including,
without limitation, the Federal Truth-In-Lending Act and other consumer
protection laws, real estate settlement procedures, usury, equal credit
opportunity and disclosure laws;
(mm) With
respect to each Co-op Loan, the related Mortgage is a valid, enforceable and
subsisting first security interest on the related cooperative shares securing
the related cooperative note, subject only to (a) liens of the cooperative
for
unpaid assessments representing the Mortgagor’s pro rata share of the
cooperative’s payments for its blanket mortgage, current and future real
property taxes, insurance premiums, maintenance fees and other assessments
to
which like collateral is commonly subject and (b) other matters to which like
collateral is commonly subject which do not materially interfere with the
benefits of the security intended to be provided by the Security
Agreement. There are no liens against or security interest in the
cooperative shares relating to each Co-op Loan (except for unpaid maintenance,
assessments and other amounts owed to the related cooperative which individually
or in the aggregate will not have a material adverse effect on such Co-op Loan),
which have priority over the Seller’s security interest in such cooperative
shares;
(nn) With
respect to each Co-op Loan, a search for filings of financing statements has
been made by a company competent to make the same, which company is acceptable
to ▇▇▇▇▇▇ ▇▇▇ and qualified to do business in the jurisdiction where the
cooperative unit is located, and such search has not found anything which would
materially and adversely affect the Co-op Loan;
(oo) With
respect to each Co-op Loan, the related cooperative corporation that owns title
to the related cooperative apartment building is a “cooperative housing
corporation” within the meaning of Section 216 of the Code, and is in material
compliance with applicable federal, state and local laws which, if not complied
with, could have a material adverse effect on the Mortgaged
Property;
(pp) With
respect to each Co-op Loan, there is no prohibition against pledging the shares
of the cooperative corporation or assigning the Co-op Lease;
(qq) The
Mortgage Loan was originated by a mortgagee approved by the Secretary of Housing
and Urban Development pursuant to sections 203 and 211 of the National Housing
Act, a savings and loan association, a savings bank, a commercial bank, credit
union, insurance company or similar institution which is supervised and examined
by a federal or state authority;
(rr) With
respect to any ground lease to which a Mortgaged Property may be subject: (i)
a
true, correct and complete copy of the ground lease and all amendments,
modifications and supplements thereto is included in the Servicing File, and
the
Mortgagor is the owner of a valid and subsisting leasehold interest under such
ground lease; (ii) such ground lease is in full force and effect, unmodified
and
not supplemented by any writing or otherwise except as contained in the Mortgage
File; (iii) all rent, additional rent and other charges reserved therein have
been fully paid to the extent payable as of the related Closing Date; (iv)
the
Mortgagor enjoys the quiet and peaceful possession of the leasehold estate,
subject to any sublease; (v) the Mortgagor is not in default under any of the
terms of such ground lease, and there are no circumstances which, with the
passage of time or the giving of notice, or both, would result in a default
under such ground lease; (vi) the lessor under such ground lease is not in
default under any of the terms or provisions of such ground lease on the part
of
the lessor to be observed or performed; (vii) the lessor under such ground
lease
has satisfied any repair or construction obligations due as of the related
Closing Date pursuant to the terms of such ground lease; (viii) the execution,
delivery and performance of the Mortgage do not require the consent (other
than
those consents which have been obtained and are in full force and effect) under,
and will not contravene any provision of or cause a default under, such ground
lease; (ix) the ground lease term extends beyond the maturity date of the
related Mortgage Loan; and (x) the Purchaser has the right to cure defaults
on
the ground lease;
(ss) With
respect to any broker fees collected and paid on any of the Mortgage Loans,
all
broker fees have been properly assessed to the borrower and no claims will
arise
as to broker fees that are double charged and for which the borrower would
be
entitled to reimbursement;
(tt) Each
Mortgage Loan constitutes a “qualified mortgage” under
Section 860G(a)(3)(A) of the Code and Treasury Regulations Section
1.860G-2(a)(1);
(uu) Except
as
provided in Section 2.07, the Mortgage Note, the Mortgage, the Assignment of
Mortgage and the other documents set forth in Exhibit A-1 and required to
be delivered on the related Closing Date have been delivered to the Purchaser
or
its designee;
(vv) All
information supplied by, on behalf of, or concerning the Mortgagor is true,
accurate and complete and does not contain any statement that is or will be
inaccurate or misleading in any material respect;
(ww) The
Mortgagor has executed a statement to the effect that the Mortgagor has received
all disclosure materials required by applicable law with respect to the making
of adjustable rate mortgage loans. The Seller shall maintain such
statement in the Servicing File;
(xx) No
Mortgage Loan had a Loan-to-Value Ratio at the time of origination of more
than
100%. No second lien Mortgage Loan has an Equity LTV in excess of
100%;
(yy) Either
(a) no consent for the second lien Mortgage Loan is required by the holder
of
the related First Lien or (b) such consent has been obtained and is contained
in
the Mortgage File;
(zz) With
respect to any second lien Mortgage Loan, the Seller has not received notice
of: (1) any proceeding for the total or partial condemnation of any
Mortgaged Property, (2) any subsequent, intervening mortgage, lien, attachment,
lis pendens or other encumbrance affecting any Mortgaged Property or (3) any
default under any mortgage, lien or other encumbrance senior to each
Mortgage;
(aaa) No
second
lien Mortgage Loan is a “home equity line of credit”;
(bbb) As
of the
Closing Date, the Seller has not received a notice of default of a First Lien
which has not been cured;
(ccc) No
First
Lien provides for negative amortization;
(ddd) No
Mortgage Loan is (i) classified as a “high cost” mortgage loan under the Home
Ownership and Equity Protection Act of 1994, as amended, nor is any Mortgage
Loan a “high cost home,” “covered”, “high risk home” or “predatory” loan under
any applicable state, federal or local law (or a similarly classified loan
using
different terminology under an applicable law imposing heightened regulatory
scrutiny or additional legal liability for residential mortgage loans having
high interest rates, points and/or fees), (ii) subject to the New Jersey Home
Ownership Security Act of 2002 (the “Act”), unless such Mortgage Loan is
a (1) “Home Loan” as defined in the Act that is a first lien Mortgage Loan,
which is not a “High Cost Home Loan” as defined in the Act or (2) “Covered Home
Loan” as defined in the Act that is a first lien purchase money Mortgage Loan,
which is not a High Cost Home Loan under the Act, or (iii) secured by Mortgaged
Property in the Commonwealth of Massachusetts with a loan application date
on or
after November 7, 2004 that refinances a mortgage loan that is less than sixty
(60) months old, unless such Mortgage Loan (a) is on an investment property,
(b)
meets the requirements set forth in the Code of Massachusetts Regulation
(“CMR”), 209 CMR 53.04(1)(b), or (c) meets the requirements set forth in
the 209 CMR 53.04(1)(c). In addition to and notwithstanding anything
to the contrary herein, no Mortgage Loan for which the Mortgaged Property is
located in New Jersey is a “Home Loan” as defined in the Act that was made,
arranged, or assigned by a person selling either a manufactured home or home
improvements to the Mortgaged Property or was made by an originator to whom
the
Mortgagor was referred by any such seller;
(eee) None
of
the proceeds of the Mortgage Loan were used to finance single-premium credit
insurance policies;
(fff) With
respect to any Mortgage Loan which is a Texas Home Equity Loan, any and all
requirements of Section 50, Article XVI of the Texas Constitution applicable
to
Texas Home Equity Loans which were in effect at the time of the origination
of
the Mortgage Loan have been complied with;
(ggg) There
is
no Mortgage Loan originated on or after October 1, 2002 and prior to March
7,
2003 and secured by a Mortgaged Property located in the State of
Georgia;
(hhh) The
origination and servicing practices with respect to each Mortgage Note and
Mortgage have been legal and in accordance with applicable laws and regulations,
and in all material respects proper and prudent in the mortgage origination
and
servicing business. With respect to escrow deposits and payments that
the Seller is entitled to collect, all such payments are in the possession
of,
or under the control of, the Seller, and there exist no deficiencies in
connection therewith for which customary arrangements for repayment thereof
have
not been made. All escrow payments have been collected and are being
maintained in full compliance with applicable state and federal law and the
provisions of the related Mortgage Note and Mortgage. As to any
Mortgage Loan that is the subject of an escrow, escrow of funds is not
prohibited by applicable law and has been established in an amount sufficient
to
pay for every escrowed item that remains unpaid and has been assessed but is
not
yet due and payable. No escrow deposits or other charges or payments
due under the Mortgage Note have been capitalized under any Mortgage or the
related Mortgage Note. All Mortgage Interest Rate adjustments have been made
in
strict compliance with state and federal law and the terms of the related
Mortgage Note. Any interest required to be paid pursuant to state and
local law has been properly paid and credited;
(iii) No
Mortgage Loan is a Convertible Mortgage Loan;
(jjj) The
Seller will transmit full-file credit reporting data for
each Mortgage Loan pursuant to the ▇▇▇▇▇▇ ▇▇▇ Selling Guide and that for each
Mortgage Loan, the Company agrees it shall report one of the following statuses
each month as follows: new origination, current, delinquent (30-, 60-, 90-days,
etc.), foreclosed, or charged-off;
(kkk) With
respect to any Mortgage Loan originated on or after August 1, 2004, neither
the
related Mortgage nor the related Mortgage Note requires the borrower to submit
to arbitration to resolve any dispute arising out of or relating in any way
to
the mortgage loan transaction;
(lll) No
borrower was required to purchase any credit life, disability, accident or
health insurance product as a condition of obtaining the extension of
credit. No borrower obtained a prepaid single-premium credit life,
disability, accident or health insurance policy in connection with the
origination of the Mortgage Loan; no proceeds from any Mortgage Loan were used
to purchase single premium credit insurance policies as part of the origination
of, or as a condition to closing, such Mortgage Loan;
(mmm) No
borrower was encouraged or required to select a Mortgage Loan product offered
by
the Mortgage Loan’s originator which is a higher cost product designed for less
creditworthy borrowers, unless at the time of the Mortgage Loan’s origination,
such borrower did not qualify taking into account credit history and
debt-to-income ratios for a lower-cost credit product then offered by the
Mortgage Loan’s originator or any affiliate of the Mortgage Loan’s originator;
and
(nnn) With
respect to any Mortgage Loan that contains a provision permitting imposition
of
a premium upon a prepayment prior to maturity: (i) prior to the loan’s
origination, the borrower agreed to such premium in exchange for a monetary
benefit, including but not limited to a rate or fee reduction, (ii) prior to
the
loan’s origination, the borrower was offered the option of obtaining a mortgage
loan that did not require payment of such a premium, (iii) the prepayment
premium is disclosed to the borrower in the loan documents pursuant to
applicable state and federal law, and (iv) notwithstanding any state or federal
law to the contrary, the Servicer shall not impose such prepayment
premium in any instance when the mortgage debt is accelerated as the result
of
the borrower’s default in making the loan payments.
Section
3.03. Repurchase.
It
is
understood and agreed that the representations and warranties set forth in
Sections 3.01 and 3.02 shall survive the sale of the Mortgage Loans and delivery
of the Mortgage File to the Purchaser, or its designee, and shall inure to
the
benefit of the Purchaser, notwithstanding any restrictive or qualified
endorsement on any Mortgage Note or Assignment of Mortgage or the examination,
or lack of examination, of any Mortgage Loan Document. Upon discovery
by the Seller or the Purchaser of a breach of any of the foregoing
representations and warranties which materially and adversely affects the value
of the Mortgage Loans or the interest of the Purchaser in any Mortgage Loan,
the
party discovering such breach shall give prompt written notice to the
others. The Seller shall have a period of ninety (90) days from the
earlier of its discovery or its receipt of notice of any such breach within
which to correct or cure such breach. The Seller hereby covenants and
agrees that if any such breach is not corrected or cured within such ninety
(90)
day period, the Seller shall, at the Purchaser’s option, repurchase such
Mortgage Loan at the Repurchase Price. In the event that any such
breach shall involve any representation or warranty set forth in Section 3.01,
and such breach is not cured within ninety (90) days of the earlier of
either discovery by or notice to the Seller of such breach, all affected
Mortgage Loans shall, at the option of the Purchaser, be repurchased by the
Seller at the Repurchase Price. Any such repurchase shall be
accomplished by deposit in the Custodial Account of the amount of the Repurchase
Price.
If
pursuant to the foregoing provisions the Seller repurchases a Mortgage Loan
that
is a MERS Mortgage Loan, the Seller shall either (i) cause MERS to execute
and
deliver an assignment of the Mortgage in recordable form to transfer the
Mortgage from MERS to the Seller and shall cause such Mortgage to be removed
from registration on the MERS® System in accordance with MERS’ rules and
regulations or (ii) cause MERS to designate on the MERS® System the Seller as
the beneficial holder of such Mortgage Loan.
It
is
understood and agreed that the obligation of the Seller set forth in this
Section 3.03 to cure or repurchase a defective Mortgage Loan, and to indemnify
Purchaser pursuant to Section 7.01, constitutes the sole remedies of the
Purchaser respecting a breach of the foregoing representations and
warranties. If the Seller fails to repurchase or substitute for a
defective Mortgage Loan in accordance with this Section 3.03, or fails to cure
a
defective Mortgage Loan to Purchaser’s reasonable satisfaction in accordance
with this Section 3.03, or to indemnify Purchaser pursuant to Section 7.01,
that
failure shall, upon compliance by the Purchaser with the next to the last
paragraph of this Section 3.03, be an Event of Default and the Purchaser shall
be entitled to pursue all available remedies. No provision of this
paragraph shall affect the rights of the Purchaser to terminate this Agreement
for cause, as set forth in Sections 8.01 and 9.01.
Any
cause
of action against the Seller relating to or arising out of the breach of any
representations and warranties made in Sections 3.01 and 3.02 shall accrue
as to
any Mortgage Loan upon (i) the earlier of discovery of such breach by the Seller
or notice thereof by the Purchaser to the Seller, (ii) failure by the Seller
to
cure such breach or repurchase such Mortgage Loan as specified above, and (iii)
demand upon the Seller by the Purchaser for compliance with this
Agreement.
In
the
event that any Mortgage Loan is held by a REMIC, notwithstanding any contrary
provision of this Agreement, with respect to any Mortgage Loan that is not
in
default or as to which no default is imminent, Purchaser may, in connection
with
any repurchase or substitution of a Defective Mortgage Loan pursuant to this
Section 3.03, require that the Seller deliver, at the Seller’s expense, an
Opinion of Counsel to the effect that such repurchase or substitution will
not
(i) result in the imposition of taxes on “prohibited transactions” of such REMIC
(as defined in Section 860F of the Code) or otherwise subject the REMIC to
tax,
or (ii) cause the REMIC to fail to qualify as a REMIC at any
time.
Section
3.04. Purchase
Price Protection.
With
respect to any Mortgage Loan that
prepays in full during the first month following the related Closing Date or
as
otherwise set forth in the related Purchase Price and Terms Letter or Assignment
and Conveyance, the Seller shall reimburse the Purchaser the amount (if any)
by
which the Purchase Price paid by the Purchaser to the Seller exceeded 100%
of
the outstanding scheduled principal balance of the Mortgage Loan as of the
related Cut-off Date, within thirty (30) days of such payoff. Upon
any assignment of a Mortgage Loan and/or this Agreement, the Purchaser may
at
its option retain its rights under this Section 3.04 notwithstanding such
assignment.
Section
3.05. Repurchase
of Mortgage Loans With First Payment Defaults.
If
a
Mortgagor is thirty (30) days or more delinquent with respect to the first
Monthly Payment, or as otherwise set forth in the related Purchase Price and
Terms Letter or Assignment and Conveyance, due to the Purchaser on the related
Mortgage Loan immediately following the related Closing Date, the Seller, at
the
Purchaser’s option, shall promptly repurchase such Mortgage Loan from the
Purchaser within thirty (30) calendar days’ of receipt of written notice from
the Purchaser. Any repurchase pursuant to this Section 3.05 shall be
made at the Repurchase Price.
ARTICLE
IV
ADMINISTRATION
AND SERVICING OF THE MORTGAGE LOANS
Section
4.01. The
Seller to Act as Servicer.
The
Seller, as independent contract servicer, shall service and administer the
Mortgage Loans in accordance with this Agreement and with Accepted Servicing
Practices, and shall have full power and authority, acting alone or through
subservicers or agents, to do or cause to be done any and all things in
connection with such servicing and administration which the Seller may deem
necessary or desirable and consistent with the terms of this Agreement and
with
Accepted Servicing Practices. The Seller shall service and administer the
Mortgage Loans through the exercise of the same care that it customarily employs
for its own account. The Seller may perform its servicing
responsibilities through agents or independent contractors, but shall not
thereby be released from any of its responsibilities
hereunder. Notwithstanding anything to the contrary, the Seller may
delegate any of its duties under this Agreement to one or more of its affiliates
without regard to any of the requirements of this Section; provided,
however, that the Seller shall not be released from any of its
responsibilities hereunder by virtue of such delegation.
Except
as
set forth in this Agreement, the Seller shall service the Mortgage Loans in
compliance with the servicing provisions of the ▇▇▇▇▇▇ ▇▇▇ Guides (special
servicing option), which include, but are not limited to, provisions regarding
the liquidation of Mortgage Loans, the collection of Mortgage Loan payments,
the
payment of taxes, insurance and other charges, the maintenance of hazard
insurance with a Qualified Insurer, the maintenance of mortgage impairment
insurance, the maintenance of fidelity bond and errors and omissions insurance,
inspections, the restoration of Mortgaged Property, the maintenance of Primary
Mortgage Insurance Policies, insurance claims, the title, management of REO
Property, permitted withdrawals with respect to REO Property, liquidation
reports, and reports of foreclosures and abandonments of Mortgaged Property,
the
transfer of Mortgaged Property, the release of Mortgage Files, annual
statements, and examination of records and facilities. In the event
of any conflict, inconsistency or discrepancy between any of the servicing
provisions of this Agreement and any of the servicing provisions of the ▇▇▇▇▇▇
Mae Guides, the provisions of this Agreement shall control and be binding upon
the Purchaser and the Seller.
Consistent
with the terms of this Agreement, the Seller may waive, modify or vary any
term
of any Mortgage Loan or consent to the postponement of any such term or in
any
manner grant indulgence to any Mortgagor if in the Seller’s reasonable and
prudent determination such waiver, modification, postponement or indulgence
is
not materially adverse to the Purchaser, provided, however, that unless
the Mortgagor is in default with respect to the Mortgage Loan, or such default
is, in the judgment of the Seller, reasonably foreseeable, or the Seller has
obtained the prior written consent of the Purchaser, the Seller shall not permit
any modification with respect to any Mortgage Loan that would change the
Mortgage Interest Rate, forgive the payment of any principal or interest, reduce
or increase the outstanding principal balance (except for actual payments of
principal), make any future advances or extend the final maturity date, as
the
case may be, with respect to such Mortgage Loan. In the event of any
such modification that permits the deferral of interest or principal payments
on
any Mortgage Loan, the Seller shall, on the Business Day immediately preceding
the Remittance Date in any month in which any such principal or interest payment
has been deferred, deposit in the Custodial Account from its own funds, in
accordance with Section 4.04, the difference between (a) the otherwise scheduled
Monthly Payment and (b) the amount paid by the Mortgagor. The Seller
shall be entitled to reimbursement for such advances to the same extent as
for
all other advances pursuant to Section 4.05. Without limiting the
generality of the foregoing, the Seller shall continue, and is hereby authorized
and empowered by the Purchaser when the Seller believes it appropriate and
reasonable in its best judgment, to prepare, execute and deliver, all
instruments of satisfaction or cancellation, or of partial or full release,
discharge and all other comparable instruments, with respect to the Mortgage
Loans and with respect to the Mortgaged Properties and to institute foreclosure
proceedings or obtain a deed-in-lieu of foreclosure so as to convert the
ownership of such properties, and to hold or cause to be held title to such
properties, on behalf of the Purchaser pursuant to the provisions of Section
4.13. Notwithstanding anything herein to the contrary, the Seller may
not enter into a forbearance agreement or similar arrangement with respect
to
any Mortgage Loan which runs more than 180 days after the first delinquent
Due
Date without the prior consent of the Purchaser. Any such agreement
shall be approved by any applicable holder of a Primary Mortgage Insurance
Policy, if required.
Notwithstanding
anything in this Agreement to the contrary, if any Mortgage Loan becomes subject
to a Pass-Through Transfer, the Seller (a) with respect to such Mortgage Loan,
shall not permit any modification with respect to such Mortgage Loan that would
change the Mortgage Interest Rate and (b) shall not (unless the Mortgagor is
in
default with respect to such Mortgage Loan or such default is, in the judgment
of the Seller, reasonably foreseeable) make or permit any modification, waiver
or amendment of any term of such Mortgage Loan that would both (i) effect an
exchange or reissuance of such Mortgage Loan under Section 1001 of the Code
(or
Treasury regulations promulgated thereunder) and (ii) cause any REMIC to fail
to
qualify as a REMIC under the Code or the imposition of any tax on “prohibited
transactions” or “contributions” after the startup date under the REMIC
Provisions.
The
Seller shall not permit the
creation of any “interests” (within the meaning of Section 860G of the Code) in
any REMIC. The Seller shall not enter into any arrangement by which a
REMIC will receive a fee or other compensation for services nor permit a REMIC
to receive any income from assets other than “qualified mortgages” as defined in
Section 860G(a)(3) of the Code or “permitted investments” as defined in Section
860G(a)(5) of the Code.
The
Seller is authorized and empowered by the Purchaser, in its own name, when
the
Seller believes it appropriate in its reasonable judgment to register any
Mortgage Loan on the MERS® System, or cause the removal from the registration of
any Mortgage Loan on the MERS® System, to execute and deliver, on behalf of the
Purchaser, any and all instruments of assignment and other comparable
instruments with respect to such assignment or re-recording of a Mortgage in
the
name of MERS, solely as nominee for the Purchaser and its successors and
assigns.
Unless
a
different time period is stated in this Agreement, the Purchaser shall be deemed
to have given consent in connection with a particular matter if the Purchaser
does not affirmatively grant or deny consent within five (5) Business Days
from
the date the Purchaser receives a written request for consent for such matter
from the Seller.
The
Seller shall accurately and fully report its borrower credit files related
to
the Mortgage Loans to Equifax, Transunion and Experian in a timely
manner.
Section
4.02. Collection
of Mortgage Loan Payments.
Continuously
from the date hereof until the date each Mortgage Loan ceases to be serviced
subject to this Agreement, the Seller will proceed diligently to collect all
payments due under each Mortgage Loan when the same shall become due and payable
and shall, to the extent such procedures shall be consistent with this
Agreement, Accepted Servicing Practices, and the terms and provisions of related
Primary Mortgage Insurance Policy, follow such collection procedures as it
follows with respect to mortgage loans comparable to the Mortgage Loans and
held
for its own account. Further, the Seller will take special care in
ascertaining and estimating annual escrow payments, and all other charges that,
as provided in the Mortgage, will become due and payable, so that the
installments payable by the Mortgagors will be sufficient to pay such charges
as
and when they become due and payable.
Section
4.03. Realization
Upon Defaulted Mortgage Loans.
The
Seller shall use commercially reasonable efforts, consistent with the procedures
that the Seller would use in servicing loans for its own account, Accepted
Servicing Practices, any Primary Mortgage Insurance and the best interest of
Purchaser, to foreclose upon or otherwise comparably convert the ownership
of
properties securing such of the Mortgage Loans as come into and continue in
default and as to which no satisfactory arrangements can be made for collection
of delinquent payments pursuant to Section 4.01. Foreclosure or
comparable proceedings shall be initiated pursuant to ▇▇▇▇▇▇ ▇▇▇ guidelines
and
applicable state law with respect to Mortgaged Properties for which no
satisfactory arrangements can be made for collection of delinquent
payments. The Seller shall use its best efforts to realize upon
defaulted Mortgage Loans in such manner as will maximize the receipt of
principal and interest by the Purchaser, taking into account, among other
things, the timing of foreclosure proceedings. The foregoing is
subject to the provisions that, in any case in which the Mortgaged Property
shall have suffered damage, the Seller shall not be required to expend its
own
funds toward the restoration of such property unless it shall determine in
its
discretion (i) that such restoration will increase the proceeds of liquidation
of the related Mortgage Loan to the Purchaser after reimbursement to itself
for
such expenses, and (ii) that such expenses will be recoverable by the Seller
through Insurance Proceeds or Liquidation Proceeds from the related Mortgaged
Property, as contemplated in Section 4.05. The Seller shall notify
the Purchaser in writing (which may be by electronic mail) of the commencement
of foreclosure proceedings. The Seller shall be responsible for all
costs and expenses incurred by it in any such proceedings or functions;
provided, however, that it shall be entitled to reimbursement thereof
from the related property, as contemplated in Section
4.05. Notwithstanding anything to the contrary contained herein, in
connection with a foreclosure or acceptance of a deed in lieu of foreclosure,
in
the event the Seller has reasonable cause to believe that a Mortgaged Property
is contaminated by hazardous or toxic substances or wastes, or if the Purchaser
otherwise requests an environmental inspection or review of such Mortgaged
Property, such an inspection or review is to be conducted by a qualified
inspector at the Purchaser’s expense. Upon completion of the
inspection, the Seller shall promptly provide the Purchaser with a written
report of the environmental inspection. After reviewing the
environmental inspection report, the Purchaser shall determine how the Seller
shall proceed with respect to the Mortgaged Property.
Notwithstanding
anything to the contrary contained herein, the Purchaser may, at the Purchaser's
sole option, terminate the Seller as servicer of any Mortgage Loan which becomes
ninety (90) days or greater delinquent in payment of a Monthly Payment, without
payment of any termination fee with respect thereto; provided, that,
notwithstanding anything to the contrary set forth in Section 4.05, the Seller
shall on the date such termination takes effect be reimbursed for any
unreimbursed Monthly Advances of the Seller's funds made pursuant to Section
5.03 and any unreimbursed Servicing Advances and unpaid Servicing Fees, in
each
case relating to such delinquent Mortgage Loan. In the event of any
such termination, the provisions of Section 9.01 hereof shall apply to such
termination and the transfer of servicing responsibilities with respect to
such
delinquent Mortgage Loan to the Purchaser or its designee.
In
the
event that a Mortgage Loan becomes part of a REMIC, and becomes REO Property,
such property shall be disposed of by the Seller, with the consent of the
Purchaser as required pursuant to this Agreement, within three (3) years after
becoming an REO Property, unless the Seller provides to the trustee under such
REMIC an opinion of counsel to the effect that the holding of such REO Property
subsequent to three years after its becoming REO Property, will not result
in
the imposition of taxes on “prohibited transactions” as defined in Section 860F
of the Code, or cause the transaction to fail to qualify as a REMIC at any
time
that certificates are outstanding. The Seller shall manage, conserve,
protect and operate each such REO Property for the certificateholders solely
for
the purpose of its prompt disposition and sale in a manner which does not cause
such property to fail to qualify as “foreclosure property” within the meaning of
Section 860G(a)(8) of the Code, or any “net income from foreclosure property”
which is subject to taxation under the REMIC provisions of the
Code. Pursuant to its efforts to sell such property, the Seller shall
either itself or through an agent selected by the Seller, protect and conserve
such property in the same manner and to such an extent as is customary in the
locality where such property is located. Additionally, the Seller
shall provide the Purchaser or any master servicer with information sufficient
to perform the tax withholding and reporting related to Sections 1445 and 6050J
of the Code.
Section
4.04. Establishment
of Custodial Accounts; Deposits in Custodial Accounts.
The
Seller shall segregate and hold all funds collected and received pursuant to
each Mortgage Loan separate and apart from any of its own funds and general
assets and shall establish and maintain one or more Custodial
Accounts. Each Custodial Account shall be an Eligible
Account. Funds deposited in a Custodial Account may be drawn on in
accordance with Section 4.05. The creation of any Custodial Account
shall be evidenced by a letter agreement in the form shown in Exhibit B
hereto. The original of such letter agreement shall be furnished to
the Purchaser on the initial Closing Date, and upon the request of any
subsequent purchaser.
The
Seller shall deposit in the Custodial Account on a daily basis, within two
(2)
Business Days of receipt thereof, and retain therein the following payments
and
collections received or made by it subsequent to the Cut-off Date, or received
by it prior to the Cut-off Date but allocable to a period subsequent thereto,
other than in respect of principal and interest on the Mortgage Loans due on
or
before the Cut-off Date:
(i) all
payments on account of principal, including Principal Prepayments, on the
Mortgage Loans;
(ii) all
payments on account of interest on the Mortgage Loans adjusted to the Mortgage
Loan Remittance Rate;
(iii) all
Liquidation Proceeds;
(iv) any
amounts required to be deposited by the Seller in connection with any REO
Property pursuant to Section 4.13 and, in connection therewith, the Seller
shall
provide the Purchaser with written detail itemizing all of such
amounts;
(v) all
Insurance Proceeds including amounts required to be deposited pursuant to
Sections 4.08, 4.10 and 4.11, other than proceeds to be held in the Escrow
Account and applied to the restoration or repair of the Mortgaged Property
or
released to the Mortgagor in accordance with Accepted Servicing Practices,
the
loan documents or applicable law;
(vi) all
Condemnation Proceeds affecting any Mortgaged Property which are not released
to
the Mortgagor in accordance with the Seller’s normal servicing procedures, the
loan documents or applicable law;
(vii) any
Monthly Advances;
(viii) Compensating
Interest, if any, for the month of distribution. Such deposit shall
be made from the Seller’s own funds, without reimbursement
therefor;
(ix) all
proceeds of any Mortgage Loan repurchased in accordance with Section 3.03 or
Section 3.05;
(x) any
amounts required to be deposited by the Seller pursuant to Section 4.11 in
connection with the deductible clause in any blanket hazard insurance policy,
such deposit shall be made from the Seller’s own funds, without reimbursement
therefor; and
(xi) any
amounts required to be deposited in the Custodial Account pursuant to Section
4.01 or Section 6.02.
The
foregoing requirements for deposit in the Custodial Account shall be exclusive,
it being understood and agreed that, without limiting the generality of the
foregoing, payments in the nature of late payment charges, assumption fees
and
other ancillary fees, to the extent permitted by Section 6.01, need not be
deposited by the Seller in the Custodial Account.
The
Seller may invest the funds in the Custodial Account in Eligible Investments
designated in the name of the Seller for the benefit of the Seller, which shall
mature not later than the Business Day next preceding the Remittance Date next
following the date of such investment (except that (A) any investment in the
Eligible Institution with which the Custodial Account is maintained may mature
on such Remittance Date and (B) any other investment may mature on such
Remittance Date if the Seller shall advance funds on such Remittance Date,
pending receipt thereof to the extent necessary to make distributions to the
Purchaser) and shall not be sold or disposed of prior to
maturity. Notwithstanding anything to the contrary herein and above,
all income and gain realized from any such investment shall be for the benefit
of the Seller and shall be subject to withdrawal by the Seller from the
Custodial Account pursuant to Section 4.05(iv). The amount of any
losses incurred in respect of any such investments shall be deposited in the
Custodial Account by the Seller out of its own funds immediately as
realized.
Section
4.05. Permitted
Withdrawals From the Custodial Account.
The
Seller may, from time to time, withdraw from the Custodial Account for the
following purposes:
(i) to
make
payments to the Purchaser in the amounts and in the manner provided for in
Section 5.01;
(ii) to
reimburse itself for Monthly Advances, the Seller’s right to reimburse itself
pursuant to this subclause (ii) being limited to amounts received on the related
Mortgage Loan which represent late collections (net of the related Servicing
Fee) of principal and/or interest respecting which any such advance was made,
it
being understood that, in the case of such reimbursement, the Seller’s right
thereto shall be prior to the rights of the Purchaser, except that, where the
Seller is required to repurchase a Mortgage Loan, pursuant to Section 3.03,
the
Seller’s right to such reimbursement shall be subsequent to the payment to the
Purchaser of the Repurchase Price pursuant to such Section and all other amounts
required to be paid to the Purchaser with respect to such Mortgage
Loan;
(iii) to
reimburse itself for unreimbursed Servicing Advances and any unpaid Servicing
Fees, the Seller’s right to reimburse itself pursuant to this subclause (iii)
with respect to any Mortgage Loan being limited to related proceeds from
Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds and REO
Disposition Proceeds;
(iv) to
pay to
itself as part of its servicing compensation: (a) any interest earned on funds
or any investment earnings in the Custodial Account net of any losses on such
investments (all such amounts to be withdrawn monthly not later than each
Remittance Date), and (b) to the extent not otherwise retained, the Servicing
Fee from that portion of any payment or recovery as to interest with respect
to
a particular Mortgage Loan;
(v) to
pay to
itself with respect to each Mortgage Loan that has been repurchased pursuant
to
Section 3.03 or Section 3.05 all amounts received thereon and not distributed
as
of the date on which the related Repurchase Price is determined;
(vi) to
reimburse itself for unreimbursed Monthly Advances and Servicing Advances to
the
extent not fully reimbursed pursuant to Section 4.05(ii) or (iii)
above;
(vii) to
transfer funds to another Eligible Account in accordance with Section 4.09
hereof;
(viii) to
remove
funds inadvertently placed in the Custodial Account by the Seller or for which
amounts previously deposited are returned unpaid by the related Mortgagor’s
banking institution; and
(ix) to
clear
and terminate the Custodial Account upon the termination of this
Agreement.
Section
4.06. Establishment
of Escrow Accounts; Deposits in Accounts.
The
Seller shall segregate and hold all funds collected and received pursuant to
each Mortgage Loan which constitute Escrow Payments separate and apart from
any
of its own funds and general assets and shall establish and maintain one or
more
Escrow Accounts. Each Escrow Account shall be an Eligible
Account. Funds deposited in the Escrow Account may be drawn on by the
Seller in accordance with Section 4.07. The creation of any Escrow
Account shall be evidenced by a letter agreement in the form shown in Exhibit
C. The original of such letter agreement shall be furnished to
the Purchaser on the initial Closing Date, and upon request to any subsequent
purchaser.
The
Seller shall deposit in the Escrow Account or Accounts on a daily basis, within
two (2) Business Days of receipt thereof, and retain therein:
(i) all
Escrow Payments collected on account of the Mortgage Loans, for the purpose
of
effecting timely payment of any such items as required under the terms of this
Agreement;
(ii) all
Insurance Proceeds which are to be applied to the restoration or repair of
any
Mortgaged Property; and
(iii) all
Servicing Advances for Mortgagors whose Escrow Payments are insufficient to
cover escrow disbursements.
The
Seller shall make withdrawals from the Escrow Account only to effect such
payments as are required under this Agreement, and for such other purposes
as
shall be as set forth or in accordance with Section 4.07. The Seller
shall be entitled to retain any interest paid on funds deposited in an Escrow
Account by the depository institution other than interest on escrowed funds
required by law to be paid to the Mortgagor and, to the extent required by
law,
the Seller shall pay interest on escrowed funds to the Mortgagor notwithstanding
that such Escrow Account is non-interest bearing or that interest paid thereon
is insufficient for such purposes.
Section
4.07. Permitted
Withdrawals From the Escrow Account.
Withdrawals
from the Escrow Account may be made by the Seller only:
(i) to
effect
timely payments of ground rents, taxes, assessments, water rates, Primary
Mortgage Insurance Policy premiums, if applicable, fire and hazard insurance
premiums, condominium assessments and comparable items for the related
Mortgage;
(ii) to
reimburse the Seller for any Servicing Advance made by the Seller with respect
to a related Mortgage Loan but only from amounts received on the related
Mortgage Loan which represent late payments or collections of Escrow Payments
thereunder;
(iii) to
refund
to the Mortgagor any funds as may be determined to be overages;
(iv) for
transfer to the Custodial Account in accordance with the terms of this
Agreement;
(v) for
application to restoration or repair of the Mortgaged Property;
(vi) to
pay to
the Seller, or to the Mortgagor to the extent required by law, any interest
paid
on the funds deposited in the Escrow Account;
(vii) to
clear
and terminate the Escrow Account on the termination of this
Agreement;
(viii) to
pay to
the Mortgagors or other parties Insurance Proceeds deposited in accordance
with
Section 4.06;
(ix) to
remove
funds inadvertently placed in the Escrow Account by the Seller or for which
amounts previously deposited are returned unpaid by the related Mortgagor’s
banking institution; and
(x) to
clear
and terminate the Escrow Account upon the termination of this
Agreement.
Section
4.08. Payment
of Taxes, Insurance and Charges; Maintenance of Primary Mortgage Insurance;
Collections Thereunder.
With
respect to each Mortgage Loan, the Seller shall maintain accurate records
reflecting the status of ground rents, taxes, assessments, water rates and
other
charges which are or may become a lien upon the Mortgaged Property and the
status of primary mortgage insurance premiums (if any) and fire and hazard
insurance coverage and shall obtain, from time to time, all bills for the
payment of such charges, including renewal premiums and shall effect payment
thereof prior to the applicable penalty or termination date and at a time
appropriate for securing maximum discounts allowable, employing for such purpose
deposits of the Mortgagor in the Escrow Account which shall have been estimated
and accumulated by the Seller in amounts sufficient for such purposes, as
allowed under the terms of the Mortgage or applicable law. To the
extent that the Mortgage does not provide for Escrow Payments, the Seller shall
determine that any such payments are made by the Mortgagor at the time they
first become due. The Seller assumes full responsibility for the
timely payment of all such bills and shall effect timely payments of all such
bills irrespective of the Mortgagor’s faithful performance in the payment of
same or the making of the Escrow Payments and shall make advances from its
own
funds to effect such payments subject to its ability to recover such Servicing
Advances pursuant to Sections 4.05(ii), (iii) and
(vi). Notwithstanding the foregoing, if the Seller reasonably
determines that any such Servicing Advance would not be recoverable from amounts
collected on the related Mortgage Loan, the Seller shall have no obligation
to
make such Servicing Advance. Any such determination shall be
evidenced by an Officer’s Certificate delivered to the Purchaser indicating the
reasons therefor.
The
Seller will maintain in full force and effect Primary Mortgage Insurance
Policies issued by a Qualified Insurer with respect to each first lien Mortgage
Loan for which such coverage is herein required. Such coverage will
be maintained until the Loan-to-Value ratio of the related Mortgage Loan is
reduced to the amount for which ▇▇▇▇▇▇ ▇▇▇ no longer requires such insurance
to
be maintained. The Seller will not cancel or refuse to renew any
Primary Mortgage Insurance Policy in effect on the related Closing Date that
is
required to be kept in force under this Agreement unless a replacement Primary
Mortgage Insurance Policy for such canceled or non-renewed policy is obtained
from and maintained with a Qualified Insurer. The Seller shall not
take any action which would result in non-coverage under any applicable Primary
Mortgage Insurance Policy of any loss which, but for the actions of the Seller
would have been covered thereunder. In connection with any assumption
or substitution agreement entered into or to be entered into pursuant to Section
6.01, the Seller shall promptly notify the insurer under the related Primary
Mortgage Insurance Policy, if any, of such assumption or substitution of
liability in accordance with the terms of such policy and shall take all actions
which may be required by such insurer as a condition to the continuation of
coverage under the Primary Mortgage Insurance Policy. If such Primary
Mortgage Insurance Policy is terminated as a result of such assumption or
substitution of liability, the Seller shall obtain a replacement Primary
Mortgage Insurance Policy as provided above.
In
connection with its activities as servicer, the Seller agrees to prepare and
present, on behalf of itself and the Purchaser, claims to the insurer under
any
Primary Mortgage Insurance Policy in a timely fashion in accordance with the
terms of such Primary Mortgage Insurance Policy and, in this regard, to take
such action as shall be necessary to permit recovery under any Primary Mortgage
Insurance Policy respecting a defaulted first lien Mortgage
Loan. Pursuant to Section 4.04, any amounts collected by the Seller
under any Primary Mortgage Insurance Policy shall be deposited in the Custodial
Account, subject to withdrawal pursuant to Section 4.05.
Section
4.09. Transfer
of Accounts.
The
Seller may transfer a Custodial Account or an Escrow Account to a different
Eligible Account from time to time. Such transfer shall be made only
upon providing notice of the transfer to the Purchaser.
Section
4.10. Maintenance
of Hazard Insurance.
The
Seller shall cause to be maintained for each Mortgage Loan fire and hazard
insurance with extended coverage as is acceptable to ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇
Mac
and customary in the area where the Mortgaged Property is located in an amount
which is equal to the lesser of (i) the maximum insurable value of the
improvements securing such Mortgage Loan and (ii) the greater of (a) the
outstanding principal balance of the Mortgage Loan, and (b) an amount such
that
the proceeds thereof shall be sufficient to prevent the Mortgagor and/or the
mortgagee from becoming a co-insurer. If required by the Flood Disaster
Protection Act of 1973, as amended, each Mortgage Loan shall be covered by
a
flood insurance policy meeting the requirements of the current guidelines of
the
Federal Insurance Administration in effect with an insurance carrier acceptable
to ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, in an amount representing coverage not less than
the least of (i) the outstanding principal balance of the Mortgage Loan, (ii)
the maximum insurable value of the improvements securing such Mortgage Loan
and
(iii) the maximum amount of insurance which is available under the Flood
Disaster Protection Act of 1973, as amended. If at any time during
the term of the Mortgage Loan, the Seller determines in accordance with
applicable law and pursuant to the ▇▇▇▇▇▇ Mae Guides that a Mortgaged Property
is located in a special flood hazard area and is not covered by flood insurance
or is covered in an amount less than the amount required by the Flood Disaster
Protection Act of 1973, as amended, the Seller shall notify the related
Mortgagor that the Mortgagor must obtain such flood insurance coverage, and
if
the related Mortgagor fails to obtain the required flood insurance coverage
within forty-five (45) days after such notification, the Seller shall
immediately force place the required flood insurance on the Mortgagor’s
behalf. To the extent the payment of the related premiums will not,
in the Seller’s reasonable determination, constitute non-recoverable Servicing
Advances, the Seller shall also maintain on each REO Property, fire and hazard
insurance with extended coverage in an amount which is at least equal to the
maximum insurable value of the improvements which are a part of such property,
and, to the extent required and available under the Flood Disaster Protection
Act of 1973, as amended, flood insurance in an amount as provided
above. Any amounts collected by the Seller under any such policies
other than amounts to be deposited in the Escrow Account and applied to the
restoration or repair of the Mortgaged Property or REO Property, or released
to
the Mortgagor in accordance with Accepted Servicing Practices, shall be
deposited in the Custodial Account, subject to withdrawal pursuant to Section
4.05. It is understood and agreed that no other additional insurance
need be required by the Seller or maintained on property acquired in respect
of
the Mortgage Loan, other than pursuant to this Agreement, the ▇▇▇▇▇▇ ▇▇▇ Guides
or such applicable state or federal laws and regulations as shall at any time
be
in force and as shall require such additional insurance. All such
policies shall be endorsed with standard mortgagee clauses with loss payable
to
the Seller and its successors and/or assigns and shall provide for at least
thirty (30) days prior written notice of any cancellation, reduction in the
amount or material change in coverage to the Seller. The Seller shall
not interfere with the Mortgagor’s freedom of choice in selecting either his
insurance carrier or agent, provided, however, that the Seller shall
not accept any such insurance policies from insurance companies unless such
companies are Qualified Insurers.
Section
4.11. Maintenance
of Mortgage Impairment Insurance Policy.
In
the
event that the Seller (or an affiliate of the Seller) shall obtain and maintain
a blanket policy issued by an issuer acceptable to ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac
insuring against hazard losses on all of the Mortgage Loans, then, to the extent
such policy provides coverage in an amount equal to the amount required pursuant
to Section 4.10 and otherwise complies with all other requirements of Section
4.10, it shall conclusively be deemed to have satisfied its obligations as
set
forth in Section 4.10, it being understood and agreed that such policy may
contain a deductible clause, in which case the Seller shall, in the event that
there shall not have been maintained on the related Mortgaged Property or REO
Property a policy complying with Section 4.10, and there shall have been a
loss
which would have been covered by such policy, deposit in the Custodial Account
the amount not otherwise payable under the blanket policy because of such
deductible clause. In connection with its activities as servicer of
the Mortgage Loans, the Seller agrees to prepare and present, on behalf of
the
Purchaser, claims under any such blanket policy in a timely fashion in
accordance with the terms of such policy. Upon request of the
Purchaser, the Seller shall cause to be delivered to the Purchaser a certified
true copy of such policy and shall use commercially reasonable efforts to obtain
a statement from the insurer thereunder that such policy shall in no event
be
terminated or materially modified without thirty (30) days’ prior written notice
to the Purchaser.
Section
4.12. Maintenance
of Fidelity Bond and Errors and Omissions Insurance.
The
Seller shall maintain, at its own expense, a blanket Fidelity Bond and an errors
and omissions insurance policy, with broad coverage with responsible companies
on all officers, employees or other persons acting in any capacity with regard
to the Mortgage Loans to handle funds, money, documents and papers relating
to
the Mortgage Loans. The Fidelity Bond shall be in the form of a
mortgage banker’s blanket bond and shall protect and insure the Seller against
losses, including forgery, theft, embezzlement and fraud of such
persons. The errors and omissions insurance shall protect and insure
the Seller against losses arising out of errors and omissions and negligent
acts
of such persons. Such errors and omissions insurance shall also protect and
insure the Seller against losses in connection with the failure to maintain
any
insurance policies required pursuant to this Agreement and the release or
satisfaction of a Mortgage Loan without having obtained payment in full of
the
indebtedness secured thereby. No provision of this Section 4.12
requiring the Fidelity Bond or errors and omissions insurance shall diminish
or
relieve the Seller from its duties and obligations as set forth in this
Agreement. The minimum coverage under any such bond and insurance
policy shall be at least equal to the corresponding amounts required by ▇▇▇▇▇▇
Mae in the ▇▇▇▇▇▇ ▇▇▇ Guides or by ▇▇▇▇▇▇▇ Mac in the ▇▇▇▇▇▇▇ Mac
Guides. The Seller shall deliver to the Purchaser a certificate from
the surety and the insurer as to the existence of the Fidelity Bond and errors
and omissions insurance policy and shall obtain a statement from the surety
and
the insurer that such Fidelity Bond or insurance policy shall in no event be
terminated or materially modified without thirty (30) days’ prior written notice
to the Purchaser. Upon request by the Purchaser, the Seller shall
provide the Purchaser with an insurance certificate certifying coverage under
this Section 4.12, and will provide an update to such certificate upon request,
or upon renewal or material modification of coverage.
Section
4.13. Title,
Management and Disposition of REO Property.
In
the
event that title to the Mortgaged Property is acquired in foreclosure, by deed
in lieu of foreclosure or other method resulting in full or partial satisfaction
of the related Mortgage, the deed or certificate of sale shall be taken in
the
name of the Purchaser or its designee, or in the event the Purchaser or its
designee is not authorized or permitted to hold title to real property in the
state where the REO Property is located, or would be adversely affected under
the “doing business” or tax laws of such state by so holding title, the deed or
certificate of sale shall be taken in the name of such Person or Persons as
shall be consistent with an Opinion of Counsel obtained by the Seller, at the
expense of the Purchaser, from an attorney duly licensed to practice law in
the
state where the REO Property is located. Any Person or Persons
holding such title other than the Purchaser shall acknowledge in writing that
such title is being held as nominee for the benefit of the
Purchaser.
The
Seller shall notify the Purchaser in accordance with the ▇▇▇▇▇▇ Mae Guides
of
each acquisition of REO Property upon such acquisition, and thereafter assume
the responsibility for marketing such REO Property in accordance with Accepted
Servicing Practices. Thereafter, the Seller shall continue to provide
certain administrative services to the Purchaser relating to such REO Property
as set forth in this Section 4.13. No Servicing Fee shall be assessed or
otherwise accrue with respect to any REO Property.
The
Seller shall, either itself or through an agent selected by the Seller, and
in
accordance with the ▇▇▇▇▇▇ ▇▇▇ Guides manage, conserve, protect and operate
each
REO Property in the same manner that it manages, conserves, protects and
operates other foreclosed property for its own account, and in the same manner
that similar property in the same locality as the REO Property is
managed. The Seller shall cause each REO Property to be inspected
promptly upon the acquisition of title thereto and shall cause each REO Property
to be inspected at least annually thereafter or more frequently as required
by
the circumstances. The Seller shall make or cause to be made a
written report of each such inspection. Such reports shall be
retained in the Servicing File.
The
Seller shall use its best efforts to dispose of the REO Property as soon as
possible and shall sell such REO Property in any event within three (3) years
after title has been taken to such REO Property, unless the Seller determines,
and gives an appropriate notice to the Purchaser to such effect, that a longer
period is necessary for the orderly liquidation of such REO
Property. If a longer period than three (3) years is permitted under
the foregoing sentence and is necessary to sell any REO Property, the Seller
shall report monthly to the Purchaser as to the progress being made in selling
such REO Property. If as of the date title to any REO Property was
acquired by the Seller there were outstanding unreimbursed Servicing Advances
with respect to the REO Property, the Seller shall be entitled to immediate
reimbursement from the Purchaser for any related unreimbursed Servicing
Advances. The disposition of REO Property shall be carried out by the
Seller at such price, and upon such terms and conditions, as the Seller deems
to
be in the best interests of the Purchaser. The Seller shall update
the Purchaser from time-to-time as to the status of each REO
Property.
Notwithstanding
anything to the contrary contained herein, the Purchaser may, at the Purchaser’s
sole option, terminate the Seller as servicer of any such REO Property without
payment of any termination fee with respect thereto; provided, that,
notwithstanding anything to the contrary set forth in Section 4.05, the Seller
shall on the date such termination takes effect be reimbursed for any
unreimbursed advances of the Seller’s funds made pursuant to Section 5.03 and
any unreimbursed Servicing Advances and unpaid Servicing Fees, in each case
relating to the Mortgage Loan underlying such REO Property. In the
event of any such termination, the provisions of Section 9.01 hereof shall
apply
to the termination and the transfer of servicing responsibilities with respect
to such REO Property to the Purchaser or its designee. Within five
(5) Business Days following any such termination, the Seller shall, if
necessary, convey such REO Property to the Purchaser and shall provide the
Purchaser with the following information regarding the subject REO Property:
the
related drive by appraisal or broker’s price opinion and copies of any related
mortgage impairment insurance policy claims. In addition, within five
(5) Business Days following any such termination, the Seller shall provide
the
Purchaser with the following information and documents regarding the subject
REO
Property: the related trustee’s deed upon sale and copies of any related hazard
insurance claims or repair bids.
Section
4.14. Notification
of Maturity Date.
With
respect to each Mortgage Loan, the Seller shall execute and deliver to the
Mortgagor any and all necessary notices required under applicable law and the
terms of the related Mortgage Note and Mortgage regarding the maturity date
if
required under applicable law.
ARTICLE
V
PAYMENTS
TO THE PURCHASER
Section
5.01. Distributions.
On
each
Remittance Date, the Seller shall distribute by wire transfer to the Purchaser
(i) all amounts credited to the Custodial Account as of the close of business
on
the preceding Determination Date, net of charges against or withdrawals from
the
Custodial Account pursuant to Section 4.05, plus (ii) all Monthly Advances,
if
any, which the Seller is obligated to distribute pursuant to Section 5.03,
plus
(iii) all payments in respect of Compensating Interest for such Remittance
Date
required to be deposited in the Custodial Account pursuant to Section
4.04(viii), minus (iv) any amounts attributable to Monthly Payments
collected but due on a Due Date or Dates subsequent to the preceding
Determination Date, which amounts shall be remitted on the Remittance Date
next
succeeding the Due Period for such amounts, and any Principal Prepayments
received during the month of such Remittance Date, which amounts shall be
remitted on the next succeeding Remittance Date.
With
respect to any remittance received by the Purchaser after the Business Day
following the Business Day on which such payment was due, the Seller shall
pay
to the Purchaser interest on any such late payment at an annual rate equal
to
the Prime Rate, adjusted as of the date of each change, plus two percentage
points, but in no event greater than the maximum amount permitted by applicable
law. Such interest shall be deposited in the Custodial Account by the
Seller on the date such late payment is made and shall cover the period
commencing with the day following the second Business Day on which such payment
was due and ending with the Business Day on which such payment is made, both
inclusive. Such interest shall be remitted along with the
distribution payable on the next succeeding Remittance Date. The payment by
the
Seller of any such interest shall not be deemed an extension of time for payment
or a waiver of any Event of Default by the Seller.
Section
5.02. Statements
to the Purchaser.
The
Seller shall furnish to the Purchaser an individual loan accounting report,
as
of the last Business Day of each month, in the Seller’s assigned loan number
order to document Mortgage Loan payment activity on an individual Mortgage
Loan
basis. With respect to each month, the corresponding individual loan
accounting report shall be received by the Purchaser no later than the fifth
(5th) Business Day of the following month in a format mutually agreed upon
by
both the Purchaser and the Seller, which report shall contain the following
(or
such other information as is mutually agreed upon by the Seller and the
Purchaser):
(i) with
respect to each Monthly Payment, the amount of such remittance allocable to
principal (including a separate breakdown of any Principal Prepayment and a
detailed report of interest on principal prepayment amounts remitted in
accordance with Section 4.04);
(ii) with
respect to each Monthly Payment, the amount of such remittance allocable to
interest;
(iii) the
aggregate Scheduled Principal Balance of the Mortgage Loans;
(iv) the
aggregate of any expenses reimbursed to the Seller during the prior distribution
period pursuant to Section 4.05; and
(v) the
number and aggregate outstanding principal balances of Mortgage Loans (a)
delinquent (1) 30 to 59 days, (2) 60 to 89 days, and (3) 90 days or more; (b)
as
to which foreclosure has commenced; and (c) as to which REO Property has been
acquired.
The
Seller shall also provide, upon request, a monthly servicing report, sorted
in
the Purchaser’s assigned loan number order, in the form of Alltel reports P139,
S214, S215 and S50Y and Fidelity report P-4DL (or in such other forms as the
Purchaser and the Seller may agree), with each such report.
The
Seller shall prepare and file any and all information statements or other
filings required to be delivered to any governmental taxing authority or to
the
Purchaser pursuant to any applicable law with respect to the Mortgage Loans
and
the transactions contemplated hereby. In addition, the Seller shall
provide the Purchaser with such information concerning the Mortgage Loans as
is
necessary for the Purchaser to prepare its federal income tax return as the
Purchaser may reasonably request from time to time.
In
addition, not more than sixty (60) days after the end of each calendar year,
the
Seller shall furnish to each Person who was a Purchaser at any time during
such
calendar year an annual statement in accordance with the requirements of
applicable federal income tax law as to the aggregate of remittances for the
applicable portion of such year.
Section
5.03. Monthly
Advances by the Seller.
Not
later
than the close of business on the Business Day preceding each Remittance Date,
the Seller shall deposit in the Custodial Account an amount equal to all Monthly
Payments, whether or not deferred pursuant to Section 4.01, which were due
on a
Mortgage Loan on the immediately preceding Due Date and delinquent at the close
of business on the related Determination Date.
The
Seller’s obligation to make such Monthly Advances as to any Mortgage Loan will
continue through the earlier of: (i) the date of the termination or resignation,
as applicable, of the Seller pursuant to Section 7.04, 8.01 or 9.01 or (ii)
the
date of final disposition and liquidation of the related Mortgage Loan or any
Mortgaged Property acquired through foreclosure or a conveyance in lieu of
foreclosure, unless the Seller reasonably believes such advance to be
non-recoverable from proceeds of the related Mortgage Loan. In such
event, the Seller shall deliver to the Purchaser an Officer’s Certificate of the
Seller to the effect that an officer of the Seller has reviewed the related
Servicing File and has made the reasonable determination that any additional
advances are non-recoverable from proceeds of the related Mortgage
Loan.
Section
5.04. Liquidation
Reports.
Upon
the
foreclosure sale of any Mortgaged Property or the acquisition thereof by the
Purchaser pursuant to a deed in lieu of foreclosure, the Seller shall submit
to
the Purchaser a liquidation report with respect to such Mortgaged
Property. The Seller shall also provide reports on the status of REO
Property containing such information as the Purchaser may reasonably
require.
ARTICLE
VI
GENERAL
SERVICING PROCEDURES
Section
6.01. Assumption
Agreements.
The
Seller shall, to the extent it has knowledge of any conveyance or prospective
conveyance by any Mortgagor of the Mortgaged Property (whether by absolute
conveyance or by contract of sale, and whether or not the Mortgagor remains
or
is to remain liable under the Mortgage Note and/or the Mortgage), exercise
its
rights to accelerate the maturity of such Mortgage Loan under any “due-on-sale”
clause to the extent permitted by law; provided, however, that the
Seller shall not exercise any such rights if prohibited by law or the terms
of
the Mortgage Note from doing so or if the exercise of such rights would impair
or threaten to impair any recovery under the related Primary Mortgage Insurance
Policy, if any. If the Seller reasonably believes it is unable under
applicable law to enforce such “due-on-sale” clause, the Seller will enter into
an assumption agreement with the person to whom the Mortgaged Property has
been
conveyed or is proposed to be conveyed, pursuant to which such person becomes
liable under the Mortgage Note and, to the extent permitted by applicable state
law, the Mortgagor remains liable thereon. If the Seller is prohibited under
applicable law from (a) entering into an assumption agreement with the Person
to
whom the Mortgaged Property has been conveyed or is proposed to be conveyed
or
(b) requiring the original Mortgagor to remain liable under the Mortgage Note,
the Seller, with the prior consent of the primary mortgage insurer, if any,
is
authorized to enter into a substitution of liability agreement with the person
to whom the Mortgaged Property has been conveyed or is proposed to be conveyed
pursuant to which the original Mortgagor is released from liability and such
Person is substituted as mortgagor and becomes liable under the related Mortgage
Note. Any such substitution of liability agreement shall be in lieu
of an assumption agreement.
In
connection with any such assumption or substitution of liability, the Seller
shall follow the underwriting practices and procedures of the ▇▇▇▇▇▇ ▇▇▇
Guides. With respect to an assumption or substitution of liability,
the Mortgage Interest Rate borne by the related Mortgage Note and the amount
of
the Monthly Payment may not be changed. If the credit of the proposed
transferee does not meet such underwriting criteria, the Seller diligently
shall, to the extent permitted by the Mortgage or the Mortgage Note and by
applicable law, accelerate the maturity of the Mortgage Loan. The
Seller shall notify the Purchaser that any such substitution of liability or
assumption agreement has been completed by forwarding to the Purchaser the
original of any such substitution of liability or assumption agreement, which
document shall be added to the related Mortgage File and shall, for all
purposes, be considered a part of such Mortgage File to the same extent as
all
other documents and instruments constituting a part thereof. All fees
collected by the Seller for entering into an assumption or substitution of
liability agreement shall belong to the Seller as additional servicing
compensation.
Notwithstanding
the foregoing paragraphs of this Section or any other provision of this
Agreement, the Seller shall not be deemed to be in default, breach or any other
violation of its obligations hereunder by reason of any assumption of a Mortgage
Loan by operation of law or any assumption which the Seller may be restricted
by
law from preventing, for any reason whatsoever. For purposes of this
Section 6.01, the term “assumption” is deemed to also include a sale of the
Mortgaged Property subject to the Mortgage that is not accompanied by an
assumption or substitution of liability agreement.
Section
6.02. Satisfaction
of Mortgages and Release of Mortgage Files.
Upon
the
payment in full of any Mortgage Loan, or the receipt by the Seller of a
notification that payment in full will be escrowed in a manner customary for
such purposes, the Seller will immediately notify the Purchaser by a
certification, which certification shall include a statement to the effect
that
all amounts received or to be received in connection with such payment which
are
required to be deposited in the Custodial Account pursuant to Section 4.04
have
been or will be so deposited, of a Servicing Officer and shall request delivery
to it of the portion of the Mortgage File held by the Purchaser. The Purchaser
shall no later than five (5) Business Days after receipt of such certification
and request, release or cause to be released to the Seller, the related Mortgage
Loan Documents and, upon its receipt of such documents, the Seller shall
promptly prepare and deliver to the Purchaser the requisite satisfaction or
release. No later than three (3) Business Days following its receipt
of such satisfaction or release, the Purchaser shall deliver, or cause to be
delivered, to the Seller the release or satisfaction properly executed by the
owner of record of the applicable Mortgage or its duly appointed attorney in
fact. If such Mortgage Loan is a MERS Mortgage Loan, the Seller is authorized
to
cause the removal from the registration on the MERS System of such Mortgage
and
to execute and deliver, on behalf of the Purchaser, any and all instruments
of
satisfaction or cancellation or of partial or full release.
In
the
event the Seller satisfies or releases a Mortgage without having obtained
payment in full of the indebtedness secured by the Mortgage or should it
otherwise prejudice any right the Purchaser may have under the Mortgage Loan
Documents, the Seller, upon written demand, shall remit within two (2) Business
Days to the Purchaser the then outstanding principal balance of the related
Mortgage Loan by deposit thereof in the Custodial Account.
From
time
to time and as appropriate for the servicing or foreclosure of the Mortgage
Loans, including for the purpose of collection under any Primary Mortgage
Insurance Policy, the Purchaser shall, upon request of the Seller and delivery
to the Purchaser of a servicing receipt signed by a Servicing Officer, release
the portion of the Mortgage File held by the Purchaser to the
Seller. Such servicing receipt shall obligate the Seller to return
such Mortgage Loan Documents to the Purchaser when the need therefor by the
Seller no longer exists, unless the Mortgage Loan has been liquidated and the
Liquidation Proceeds relating to the Mortgage Loan have been deposited in the
Custodial Account or the Mortgage File has been delivered to an attorney, or
to
a public trustee or other public official as required by law, for purposes
of
initiating or pursuing legal action or other proceedings for the foreclosure
of
the Mortgaged Property either judicially or non-judicially, and the Seller
has
delivered to the Purchaser a certificate of a Servicing Officer certifying
as to
the name and address of the Person to which such Mortgage File was delivered
and
the purpose or purposes of such delivery. Upon receipt of a
certificate of a Servicing Officer stating that such Mortgage Loan was
liquidated, the servicing receipt shall be released by the Purchaser to the
Seller.
Section
6.03. Servicing
Compensation.
As
compensation for its services hereunder, the Seller shall be entitled to
the Servicing Fee. Additional servicing compensation in
the form of assumption fees, as provided in Section 6.01, late payment charges,
prepayment penalties (unless otherwise set forth in the related Purchase Price
and Terms Letter or Assignment and Conveyance), interest and investment earning
on funds on deposit in the Custodial Account and Escrow Account (to the extent
provided for herein) and other ancillary income shall be retained by the Seller
to the extent not required to be deposited in the Custodial
Account. The Seller shall be required to pay all expenses incurred by
it in connection with its servicing activities hereunder and shall not be
entitled to reimbursement therefor except as specifically provided for
herein.
Section
6.04. Annual
Statement as to Compliance.
Within
the later of (a) seventy-five (75) days after the end of each calendar year
or
(b) fifteen (15) calendar days prior to the date on which the Purchaser or
the
affiliate of the Purchaser required to file an annual report on Form 10-K in
connection with any Pass-Through Transfer is required to file such annual report
on Form 10-K with the United States Securities and Exchange Commission (the
“SEC”), the Seller will deliver to the Purchaser an Officers’ Certificate
stating, as to each signatory thereof, that (i) a review of the activities
of
the Seller during the preceding calendar year and of performance under this
Agreement has been made under such officers’ supervision, and (ii) to the best
of such officers’ knowledge, based on such review, the Seller has fulfilled in
all material respects all of its obligations under this Agreement throughout
such year, or, if there has been a default in the fulfillment of any such
obligation, specifying each such default known to such officers and the nature
and status thereof. The first Officer’s Certificate delivered by the
Seller to the Purchaser pursuant to this Section shall be delivered on or before
March 15, 2006, or such other date as may be required pursuant to the first
sentence of this Section 6.04. Copies of such statement shall be
provided by the Seller to the Purchaser upon request.
Section
6.05. Annual
Independent Certified Public Accountants’ Servicing Report.
Within
the later of (a) seventy-five (75) days after the end of each calendar year
or
(b) fifteen (15) calendar days prior to the date on which the Purchaser or
the
affiliate of the Purchaser required to file an annual report on Form 10-K in
connection with any Pass-Through Transfer is required to file such annual report
on Form 10-K with the SEC, the Seller at its expense shall cause a firm of
independent public accountants which is a member of the American Institute
of
Certified Public Accountants to furnish a statement to the Purchaser to the
effect that such firm has examined certain documents and records relating to
the
Seller’s servicing of residential mortgage loans, and that, on the basis of such
an examination, conducted substantially in compliance with the Uniform Single
Attestation Program for Mortgage Bankers or the Audit Guide for HUD Approved
Title II Approved Mortgagees and Loan Correspondent Programs, such firm is
of
the opinion that the Seller’s servicing has been conducted in compliance with
such programs, except for (i) such exceptions as such firm shall believe to
be
immaterial, and (ii) such other exceptions as shall be set forth in such
statement. The first statement delivered by the Seller to the
Purchaser pursuant to this Section shall be delivered on or before March 15,
2006, or such other date as may be required pursuant to the first sentence
of
this Section 6.05. Copies of such statement shall be provided by the
Seller to the Purchaser.
Section
6.06. Purchaser’s
Right to Examine Seller Records.
At
its
expense, the Purchaser shall have the right to examine and audit upon reasonable
notice to the Seller, during business hours or at such other times as might
be
reasonable under applicable circumstances, any and all of the books, records,
documentation or other information of the Seller, or held by another for the
Seller or on its behalf or otherwise, which relates to the performance or
observance by the Seller of the terms, covenants or conditions of this
Agreement.
The
Seller shall provide to the Purchaser and any supervisory agents or examiners
representing a state or federal governmental agency having jurisdiction over
the
Purchaser, including but not limited to, OCC, OTS, FDIC and other similar
entities, access to any documentation regarding the Mortgage Loans in the
possession of the Seller which may be required by any applicable
regulations. Such access shall be afforded without charge, upon
reasonable request, during normal business hours and at the offices of the
Seller, and in accordance with the federal government, OCC, FDIC, OTS, or any
other similar regulations; provided, however, that in connection with
providing such access, the Seller shall not be required to incur any
out-of-pocket costs unless provisions have been made for the reimbursement
thereof.
Section
6.07. Seller
Shall Provide Information as Reasonably Required.
The
Seller shall furnish to the Purchaser during the term of this Agreement such
periodic, special or other reports, information or documentation as the
Purchaser may reasonably request, as shall be necessary, reasonable or
appropriate in respect to the Mortgage Loans and the performance of the Seller
under this Agreement, including any reports, information or documentation
reasonably required to comply with any regulations regarding any supervisory
agents or examiners of the Purchaser; provided, that, the Seller shall not
be
liable for any out-of-pocket costs with respect to the provision of such
reports, information or documentation. All such reports or
information shall be provided by and in accordance with such applicable
instructions and directions as the Purchaser may reasonably request in relation
to this Agreement or the performance of the Seller under this
Agreement. The Seller agrees to execute and deliver all such
instruments and take all such action as the Purchaser, from time to time, may
reasonably request in order to effectuate the purpose and to carry out the
terms
of this Agreement.
The
Seller, upon reasonable advance notice, shall make reasonably available to
the
Purchaser or any prospective purchaser a knowledgeable financial or accounting
officer for the purpose of answering questions and to permit any prospective
purchaser to inspect the Seller’s servicing facilities for the purpose of
satisfying such prospective purchaser that the Seller has the ability to service
the Mortgage Loans as provided in this Agreement.
The
Seller shall maintain with respect to each Mortgage Loan and shall make
available for inspection by the Purchaser or its designee the related Servicing
File during the time the Purchaser retains ownership of a Mortgage Loan and
thereafter in accordance with applicable laws and regulations.
ARTICLE
VII
THE
SELLER
Section
7.01. Indemnification;
Third Party Claims.
The
Seller agrees to indemnify the Purchaser and hold it harmless against any and
all claims, losses, damages, penalties, fines, forfeitures, legal fees and
related costs, judgments, and any other costs, fees and expenses (collectively,
“Damages”) that the Purchaser may sustain in any way related to the
failure of the Seller to observe and perform its duties, obligations, covenants,
and agreements and to service the Mortgage Loans in compliance with the terms
of
this Agreement or from any claim, demand, defense or assertion based on or
grounded upon, or resulting from a breach of a representation or warranty set
forth in Sections 3.01 or 3.02 of this Agreement. The Seller
hereunder shall immediately notify the Purchaser if a claim is made by a third
party with respect to this Agreement or a Mortgage Loan, assume (with the
consent of the Purchaser) the defense of any such claim and pay all expenses
in
connection therewith, including counsel fees, and promptly pay, discharge and
satisfy any judgment or decree which may be entered against it or the Purchaser
in respect of such claim. The Seller shall follow any written
instructions received from the Purchaser in connection with such
claim. The Purchaser shall promptly reimburse the Seller for all
amounts advanced by it pursuant to the two preceding sentences except when
the
claim relates to the failure of the Seller to service and administer the
Mortgage Loans in compliance with the terms of this Agreement, the failure
of
the Seller to perform its duties and obligations pursuant to this Agreement,
the
breach of representation or warranty set forth in Sections 3.01 or 3.02, or
the
gross negligence, bad faith or willful misconduct of the Seller. The
provisions of this Section 7.01 shall survive termination of this Agreement
and
transfer of the related servicing rights.
Section
7.02. Merger
or Consolidation of the Seller.
The
Seller shall keep in full effect its existence, rights and franchises as a
corporation under the laws of the state of its incorporation except as permitted
herein, and shall obtain and preserve its qualification to do business as a
foreign corporation in each jurisdiction in which such qualification is or
shall
be necessary to protect the validity and enforceability of this Agreement,
or
any of the Mortgage Loans and to perform its duties under this
Agreement.
Any
Person into which the Seller may be merged or consolidated (including by means
of sale or disposal of all or substantially all of the Seller’s assets), or any
corporation resulting from any merger, conversion or consolidation to which
the
Seller shall be a party, or any Person succeeding to the business of the Seller
(whether or not related to loan servicing), shall be the successor of the Seller
hereunder, without the execution or filing of any paper or any further act
on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided, however, that the successor or surviving
Person shall be an institution (i) having a GAAP net worth of not less than
$25,000,000 and (ii) an institution who is a ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac approved
seller/servicer in good standing.
Section
7.03. Limitation
on Liability of the Seller and Others.
The
duties and obligations of the Seller shall be determined solely by the express
provisions of this Agreement, the Seller shall not be liable except for the
performance of such duties and obligations as are specifically set forth in
this
Agreement and no implied covenants or obligations shall be read into this
Agreement against the Seller. Neither the Seller nor any of the
officers, employees or agents of the Seller shall be under any liability to
the
Purchaser for any action taken or for refraining from the taking of any action
in good faith pursuant to this Agreement, or for errors in judgment made in
good
faith; provided, however, that this provision shall not protect the
Seller or any such person against any breach of warranties or representations
made herein, or failure to perform its obligations in compliance with any
standard of care set forth in this Agreement, or any liability which would
otherwise be imposed by reason of negligence, bad faith or willful misconduct,
or any breach of the terms and conditions of this Agreement. The
Seller and any officer, employee or agent of the Seller may rely in good faith
on any document of any kind prima facie properly executed and submitted by
the
Purchaser respecting any matters arising hereunder. The Seller shall
not be under any obligation to appear in, prosecute or defend any legal action
which is not incidental to its duties to service the Mortgage Loans in
accordance with this Agreement and which in its reasonable opinion may involve
it in any expenses or liability; provided, however, that the Seller may
undertake any such action which it may deem necessary or desirable in respect
to
this Agreement and the rights and duties of the parties hereto. In
such event, the reasonable legal expenses and costs of such action and any
liability resulting therefrom shall be expenses, costs and liabilities for
which
the Purchaser will be liable, and the Seller shall be entitled to be reimbursed
therefor from the Purchaser upon written demand.
Section
7.04. Seller
Not to Assign or Resign.
Except
as
otherwise provided herein, the Seller shall not assign this Agreement or resign
from the obligations and duties hereby imposed on it except by mutual consent
of
the Seller and the Purchaser or upon the determination that its duties hereunder
are no longer permissible under applicable law and such incapacity cannot be
cured by the Seller. Any such determination permitting the
resignation of the Seller shall be evidenced by an Opinion of Counsel to such
effect delivered to the Purchaser which Opinion of Counsel shall be in form
and
substance acceptable to the Purchaser. No such resignation shall
become effective until a successor shall have assumed the Seller’s
responsibilities and obligations hereunder in the manner provided in Section
11.01.
Section
7.05. No
Transfer of Servicing.
With
respect to the retention of the Seller to service the Mortgage Loans hereunder,
the Seller acknowledges that the Purchaser has acted in reliance upon the
Seller’s independent status, the adequacy of its servicing facilities, plan,
personnel, records and procedures, its integrity, reputation and financial
standing and the continuance thereof. Without in any way limiting the
generality of this Section 7.05, the Seller shall not either assign this
Agreement or the servicing hereunder or delegate its rights or duties hereunder
or any portion thereof without the prior written approval of the Purchaser,
which consent shall not be unreasonably withheld. Notwithstanding the
foregoing, the Seller may, without the consent of the Purchaser, retain
reasonable and necessary third party contractors to perform certain servicing
and loan administration functions, including and limited to, hazard insurance
administration, tax payment and administration, flood certification and
administration and foreclosure activities; provided, that such contractors
shall
perform such servicing and loan administrative functions in a manner consistent
with this Agreement; provided, further, that the retention of such contractors
by Seller shall not limit the obligation of the Seller to service the Mortgage
Loans pursuant to the terms and conditions of this Agreement or release it
from
any of its obligations hereunder.
ARTICLE
VIII
DEFAULT
Section
8.01. Events
of Default.
In
case
one or more of the following Events of Default by the Seller shall occur and
be
continuing, that is to say:
(i) any
failure by the Seller to remit to the Purchaser any payment required to be
made
under the terms of this Agreement which continues unremedied for a period of
two
(2) Business Days after the date upon which written notice of such failure,
requiring the same to be remedied, shall have been given to the Seller by the
Purchaser; or
(ii) failure
on the part of the Seller duly to observe or perform in any material respect
any
other of the covenants or agreements on the part of the Seller set forth in
this
Agreement, which failure continues unremedied for a period of thirty (30) days
after the date on which written notice of such failure, requiring the same
to be
remedied, shall have been given to the Seller by the Purchaser; or
(iii) a
decree
or order of a court or agency or supervisory authority having jurisdiction
for
the appointment of a conservator or receiver or liquidator in any insolvency,
bankruptcy, readjustment of debt, marshalling of assets and liabilities or
similar proceedings, or for the winding-up or liquidation of its affairs, shall
have been entered against the Seller and such decree or order shall have
remained in force undischarged or unstayed for a period of sixty (60) days;
or
(iv) the
Seller shall consent to the appointment of a conservator or receiver or
liquidator in any insolvency, bankruptcy, readjustment of debt, marshalling
of
assets and liabilities or similar proceedings of or relating to the Seller
or of
or relating to all or substantially all of its property; or
(v) the
Seller shall admit in writing its inability to pay its debts generally as they
become due, file a petition to take advantage of any applicable insolvency
or
reorganization statute, make an assignment for the benefit of its creditors,
or
voluntarily suspend payment of its obligations; or
(vi) the
Seller ceases to be approved by ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac as a mortgage loan
seller and servicer for more than thirty (30) days; or
(vii) the
Seller attempts to assign its right to servicing compensation hereunder or
the
Seller attempts, without the consent of the Purchaser, to assign this Agreement
or the servicing responsibilities hereunder or to delegate its duties hereunder
or any portion thereof in a manner not permitted under this Agreement;
or
(viii) the
Seller ceases to be (a) licensed to service first lien residential mortgage
loans in each jurisdiction in which a Mortgaged Property is located and such
licensing is required, and (b) qualified to transact business in any
jurisdiction where it is currently so qualified, but only to the extent such
non-qualification materially and adversely affects the Seller’s ability to
perform its obligations hereunder; or
(ix) failure
on the part of the Seller to comply with Section 6.04 or Section 6.05, which
failure continues unremedied for a period of fifteen (15) days after the date
on
which written notice of such failure, requiring the same to be remedied, shall
have been given to the Seller by the Purchaser.
then,
and
in each and every such case, so long as an Event of Default shall not have
been
remedied, the Purchaser, by notice in writing to the Seller may, in addition
to
whatever rights the Purchaser may have under Sections 3.03 and 7.01 and at
law
or equity or to damages, including injunctive relief and specific performance,
terminate all the rights and obligations of the Seller under this Agreement
and
in and to the Mortgage Loans and the proceeds thereof without compensating
the
Seller for the same. On or after the receipt by the Seller of such
written notice of termination, all authority and power of the Seller under
this
Agreement, whether with respect to the Mortgage Loans or otherwise, shall pass
to and be vested in the successor appointed pursuant to Section
12.01. Upon written request from the Purchaser, the Seller shall
prepare, execute and deliver, any and all documents and other instruments,
place
in such successor’s possession all Servicing Files, and do or accomplish all
other acts or things necessary or appropriate to effect the purposes of such
notice of termination, whether to complete the transfer and endorsement or
assignment of the Mortgage Loans and related documents, or otherwise, at the
Seller’s sole expense. The Seller agrees to cooperate with the Purchaser and
such successor in effecting the termination of the Seller’s responsibilities and
rights hereunder, including, without limitation, the transfer to such successor
for administration by it of all cash amounts which shall at the time be credited
by the Seller to the Custodial Account or Escrow Account or thereafter received
with respect to the Mortgage Loans or any REO Property.
If
any of
the Mortgage Loans are MERS Mortgage Loans, in connection with the termination
or resignation (as described in Section 8.04) of the Seller hereunder, either
(i) the successor servicer shall represent and warrant that it is a member
of
MERS in good standing and shall agree to comply in all material respects with
the rules and procedures of MERS in connection with the servicing of the
Mortgage Loans that are registered with MERS, or (ii) the Seller shall cooperate
with the successor servicer either (x) in causing MERS to execute and deliver
an
assignment of Mortgage in recordable form to transfer the Mortgage from MERS
to
the Purchaser and to execute and deliver such other notices, documents and
other
instruments as may be necessary or desirable to effect a transfer of such
Mortgage Loan or servicing of such Mortgage Loan on the MERS® System to the
successor servicer or (y) in causing MERS to designate on the MERS® System the
successor servicer as the servicer of such Mortgage Loan.
Section
8.02. Waiver
of Defaults.
The
Purchaser may waive only by written notice any default by the Seller in the
performance of its obligations hereunder and its consequences. Upon
any such waiver of a past default, such default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been remedied for
every purpose of this Agreement. No such waiver shall extend to any
subsequent or other default or impair any right consequent thereon except to
the
extent expressly so waived in writing.
ARTICLE
IX
TERMINATION
Section
9.01. Termination.
The
respective obligations and responsibilities of the Seller shall terminate
upon: (i) the later of the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan or the disposition
of
all REO Property and the remittance of all funds due hereunder; (ii) by mutual
consent of the Seller and the Purchaser in writing; or (iii) termination of
the
Seller by the Purchaser with cause under the terms of this
Agreement.
ARTICLE
X
RECONSTITUTION
OF MORTGAGE LOANS
Section
10.01. Reconstitution
of Mortgage Loans.
(a) The
Seller acknowledges and the Purchaser agrees that with respect to some or all
of
the Mortgage Loans, the Purchaser may effect, upon ten (10) Business Days prior
written notice to the Seller, either:
(i) one
or
more sales of the Mortgage Loans as whole loan transfers (each, a “Whole Loan
Transfer”);
(ii) one
or
more Agency Transfers; and/or
(iii) one
or
more sales of the Mortgage Loans as public or private pass-through transfers
(each, a “Pass-Through Transfer”).
(b) With
respect to each Whole Loan Transfer, Agency Transfer or Pass-Through Transfer,
as the case may be, the Seller agrees:
(i) to
cooperate reasonably with the Purchaser and any prospective purchaser with
respect to all reasonable requests that do not result in an undue burden or
expense of the Seller;
(ii) to
execute all agreements required to be executed by the Seller in connection
with
such Whole Loan Transfer, Agency Transfer or Pass-Through Transfer, including
a
pooling and servicing agreement in form and substance reasonably acceptable
to
the parties, provided that any such agreements be consistent with the terms
hereof and, unless otherwise agreed by the Seller, impose no greater duties,
liabilities or obligations upon the Seller than those set forth herein and
provided that the Seller is given an opportunity to review and reasonably
negotiate in good faith the content of such documents not specifically
referenced or provided for herein;
(iii) to
make
all the representations and warranties set forth in Section 3.01 as of the
date
of the Whole Loan Transfer, Agency Transfer or Pass-Through
Transfer;
(iv) to
deliver to the Purchaser (a) for inclusion in any prospectus or other offering
material such publicly available information regarding the Seller and its
financial condition and any additional information reasonably requested by
the
Purchaser or required by law or regulation, (b) any similar nonpublic, unaudited
financial information (which the Purchaser may, at its option and its cost,
have
audited by certified public accountants) and such other information as is
reasonably requested by the Purchaser and which the Seller is capable of
providing without unreasonable effort or expense, and to indemnify the Purchaser
and its affiliates for any losses, costs or damages incurred by any of them
directly related to any material misstatements contained in such information
or
for any omissions of material fact required to be stated therein to the extent
such information is provided by the Seller specifically for use in a prospectus
or other offering material; provided, that, the Purchaser shall
indemnify the Seller and its affiliates for any losses, costs or damages related
to any material misstatements contained in any prospectus or other offering
material other than in such information provided by the Seller specifically
for
use therein or for any omissions of material fact required to be stated therein
and (c) such statements and audit letters of reputable, certified public
accountants pertaining to information provided by the Seller pursuant to clause
(a) above as shall be reasonably requested by the Purchaser; and
(v) to
deliver to the Purchaser, and to any Person designated by the Purchaser,
opinions of counsel in a form reasonably acceptable to the Purchaser as are
customarily delivered by sellers and servicers and reasonably determined by
the
Purchaser to be necessary in connection with Whole Loan Transfers, Agency
Transfers or Pass-Through Transfers, as the case may be, it being understood
that the reasonable cost of any opinions of counsel (other than in-house
counsel) that may be required for a Whole Loan Transfer, Agency Transfer or
Pass-Through Transfer, as the case may be, shall be the responsibility of the
Purchaser.
The
Purchaser shall reimburse the Seller for any and all reasonable out-of-pocket
expenses, costs and fees, including reasonable attorney’s fees, incurred by the
Seller in response to requests for information or assistance under this
Section. All Mortgage Loans not sold or transferred pursuant to a
Whole Loan Transfer, Agency Transfer or Pass-Through Transfer shall be subject
to this Agreement and shall continue to be serviced in accordance with the
terms
of this Agreement and with respect thereto this Agreement shall remain in full
force and effect. Notwithstanding anything to the contrary in this Section
10.01, the Company agrees that it is required to perform the obligations
described in Exhibit H hereto in connection with a
Reconstitution.
Section
10.02. Monthly
Reporting with Respect to a Reconstitution.
As
long as the Company continues to
service Mortgage Loans, the Company agrees that with respect to any Mortgage
Loan sold or transferred pursuant to a Reconstitution as described in Section
10.01 of this Agreement (a “Reconstituted Mortgage Loan”), the Company,
at its expense, shall provide the Purchaser with the information set forth
in
Exhibit G attached hereto for each Reconstituted Mortgage Loan in Excel
or such electronic delimited file format as may be mutually agreed upon by
both
Purchaser and Company. Such information shall be provided monthly for
all Reconstituted Mortgage Loans on the fifth (5th) Business Day of each month
for the immediately preceding monthly period, and shall be transmitted to the
new investor or master servicer.
ARTICLE
XI
MISCELLANEOUS
PROVISIONS
Section
11.01. Successor
to the Seller.
Prior
to
termination of Seller’s responsibilities and duties under this Agreement
pursuant to Section 7.04, 8.01 or 9.01, the Purchaser shall (i) succeed to
and
assume all of the Seller’s responsibilities, rights, duties and obligations
under this Agreement, or (ii) appoint a successor having the characteristics
set
forth in Section 7.02 hereof and which shall succeed to all rights and assume
all of the responsibilities, duties and liabilities of the Seller under this
Agreement. In connection with such appointment and assumption, the
Purchaser may make such arrangements for the compensation of such successor
out
of payments on Mortgage Loans as the Purchaser and such successor shall
agree. In the event that the Seller’s duties, responsibilities and
liabilities under this Agreement should be terminated pursuant to the
aforementioned Sections, the Seller shall discharge such duties and
responsibilities during the period from the date it acquires knowledge of such
termination until the effective date thereof with the same degree of diligence
and prudence which it is obligated to exercise under this Agreement, and shall
take no action whatsoever that might impair or prejudice the rights or financial
condition of its successor. The resignation or removal of the Seller
pursuant to the aforementioned Sections shall not become effective until a
successor shall be appointed pursuant to this Section and shall in no event
relieve the Seller of the representations and warranties made pursuant to
Section 3.01 and the indemnification obligations of the Seller pursuant to
Section 7.01.
Any
successor appointed as provided herein shall execute, acknowledge and deliver
to
the Seller and to the Purchaser an instrument accepting such appointment,
whereupon such successor shall become fully vested with all the rights, powers,
duties, responsibilities, obligations and liabilities of the Seller, with like
effect as if originally named as a party to this Agreement. Any
termination or resignation of the Seller or this Agreement pursuant to Section
7.04, 7.05, 8.01 or 9.01 shall not affect any claims that the Purchaser may
have
against the Seller arising prior to any such termination or
resignation.
The
Seller shall promptly deliver to the successor the funds in the Custodial
Account and the Escrow Account and the Mortgage Files and related documents
and
statements held by it hereunder and the Seller shall account for all
funds. The Seller shall execute and deliver such instruments and do
such other things all as may reasonably be required to more fully and definitely
vest and confirm in the successor all such rights, powers, duties,
responsibilities, obligations and liabilities of the Seller. Upon
appointment of successor servicer to the Seller, the Seller shall be reimbursed
for unrecovered Servicing Advances, Monthly Advances and unpaid Servicing Fees
which would otherwise have been recovered by the Seller pursuant to this
Agreement but for the appointment such successor servicer.
Upon
a
successor’s acceptance of appointment as such, the Seller shall notify by mail
the Purchaser of such appointment.
Section
11.02. Amendment.
This
Agreement may be amended or supplemented from time to time by written agreement
executed by the Purchaser and the Seller.
Section
11.03. Recordation
of Agreement.
To
the
extent permitted by applicable law, this Agreement is subject to recordation
in
all appropriate public offices for real property records in all the counties
or
other comparable jurisdictions in which any of all the Mortgaged Properties
subject to the Mortgages are situated, and in any other appropriate public
recording office or elsewhere, such recordation to be effected by the Seller
at
the Seller’s expense on direction of the Purchaser.
Section
11.04. Governing
Law.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of New York, without regard to its conflict of law provisions, except
to
the extent preempted by Federal law. The obligations, rights and
remedies of the parties hereunder shall be determined in accordance with such
laws.
Section
11.05. Notices.
Any
demands, notices or other communications permitted or required hereunder shall
be in writing and shall be deemed conclusively to have been given if personally
delivered at or mailed by registered mail, postage prepaid, and return receipt
requested or certified mail, return receipt requested, or transmitted by telex,
telegraph or telecopier and confirmed by a similar mailed writing, as
follows:
(i) if
to the Seller:
Wachovia
Mortgage Corporation
▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇▇
▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 28288-1088
Attention: ▇▇▇▇▇▇▇▇
▇▇▇▇▇
Facsimile:
(▇▇▇) ▇▇▇-▇▇▇▇
with
a copy to:
Wachovia
Mortgage Corporation
▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇
▇▇▇▇▇▇
Facsimile:
(▇▇▇) ▇▇▇-▇▇▇▇
(ii) if
to the Purchaser:
EMC
Mortgage Corporation
Mac
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇,
▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇.
▇▇▇▇▇▇
▇▇▇▇▇
Telecopier
No.: (▇▇▇) ▇▇▇-▇▇▇▇
with
copy
to:
Bear
▇▇▇▇▇▇▇ Mortgage Capital Corporation
▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
or
such
other address as may hereafter be furnished to the other party by like
notice. Any such demand, notice or communication hereunder shall be
deemed to have been received on the date delivered to or received at the
premises of the addressee (as evidenced, in the case of registered or certified
mail, by the date noted on the return receipt).
Section
11.06. Severability
of Provisions.
Any
part,
provision, representation or warranty of this Agreement which is prohibited
or
which is held to be void or unenforceable shall be ineffective to the extent
of
such prohibition or unenforceability without invalidating the remaining
provisions hereof. Any part, provision, representation or warranty of
this Agreement which is prohibited or unenforceable or is held to be void or
unenforceable in any jurisdiction shall be ineffective, as to such jurisdiction,
to the extent of such prohibition or unenforceability without invalidating
the
remaining provisions hereof, and any such prohibition or unenforceability in
any
jurisdiction as to any Mortgage Loan shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent
permitted by applicable law, the parties hereto waive any provision of law
which
prohibits or renders void or unenforceable any provision hereof. If
the invalidity of any part, provision, representation or warranty of this
Agreement shall deprive any party of the economic benefit intended to be
conferred by this Agreement, the parties shall negotiate, in good faith, to
develop a structure the economic effect of which is nearly as possible the
same
as the economic effect of this Agreement without regard to such
invalidity.
Section
11.07. Exhibits.
The
exhibits to this Agreement are hereby incorporated and made a part hereof and
are an integral part of this Agreement.
Section
11.08. General
Interpretive Principles.
For
purposes of this Agreement, except as otherwise expressly provided or unless the
context otherwise requires:
(i) the
terms
defined in this Agreement have the meanings assigned to them in this Agreement
and include the plural as well as the singular, and the use of any gender herein
shall be deemed to include the other gender;
(ii) accounting
terms not otherwise defined herein have the meanings assigned to them in
accordance with GAAP;
(iii) references
herein to “Articles,” “Sections,” Subsections,” “Paragraphs,” and other
subdivisions without reference to a document are to designated Articles,
Sections, Subsections, Paragraphs and other subdivisions of this
Agreement;
(iv) a
reference to a Subsection without further reference to a Section is a reference
to such Subsection as contained in the same Section in which the reference
appears, and this rule shall also apply to Paragraphs and other
subdivisions;
(v) the
words
“herein,” “hereof,” “hereunder,” and other words of similar import refer to this
Agreement as a whole and not to any particular provision;
(vi) the
term
“include” or “including” shall mean without limitation by reason of enumeration;
and
(vii) headings
of the Articles and Sections in this Agreement are for reference purposes only
and shall not be deemed to have any substantive effect.
Section
11.09. Reproduction
of Documents.
This
Agreement and all documents relating thereto, including, without limitation,
(i)
consents, waivers and modifications which may hereafter be executed, (ii)
documents received by any party at the closing, and (iii) financial statements,
certificates and other information previously or hereafter furnished, may be
reproduced by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties agree that any
such reproduction shall be admissible in evidence as the original itself in
any
judicial or administrative proceeding, whether or not the original is in
existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in
evidence.
Section
11.10. Confidentiality
of Information.
Each
party recognizes that, in connection with this Agreement, it may become privy
to
non-public information regarding the financial condition, operations and
prospects of the other party. Except as required by law, each party
agrees to keep all non-public information regarding the other party strictly
confidential, and to use all such information solely in order to effectuate
the
purpose of the Agreement, provided that each party may provide confidential
information to its employees, agents and affiliates who have a need to know
such
information in order to effectuate the transaction, provided further that such
information is identified as confidential non-public information. In
addition, confidential information may be provided to a regulatory authority
with supervisory power over the Purchaser, provided such information is
identified as confidential non-public information.
Section
11.11. Recordation
of Assignments of Mortgage.
To
the
extent permitted by applicable law, each of the Assignments of Mortgage is
subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which any
or
all of the Mortgaged Properties are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected (i) with
respect to MERS Mortgage Loans, at the Purchaser’s expense and (ii) with respect
to Mortgage Loans that are not MERS Mortgage Loans, at the Seller’s expense, in
each case, in the event recordation is either necessary under applicable law
or
requested by the Purchaser at its sole option.
Section
11.12. Assignment
by Purchaser.
The
Purchaser shall have the right, upon notice to the Seller, to assign, in whole
or in part, its interest under this Agreement with respect to some or all of
the
Mortgage Loans, and designate any person to exercise any rights of the Purchaser
hereunder, by executing an Assignment, Assumption and Recognition Agreement
substantially in the form of Exhibit D hereto, and the assignee or
designee shall accede to the rights and obligations hereunder of the Purchaser
with respect to such Mortgage Loans; provided, however, that, in no
event shall there be any more than five (5) “Purchasers” with respect to any
Mortgage Loan Package. In no event shall the Purchaser sell a partial
interest in any Mortgage Loan without the prior written consent of the Seller,
which consent may be granted or withheld in the Seller’s sole
discretion. All references to the Purchaser in this Agreement shall
be deemed to include its assignee or designee.
Section
11.13. No
Partnership.
Nothing
herein contained shall be deemed or construed to create a co-partnership or
joint venture between the parties hereto and the services of the Seller shall
be
rendered as an independent contractor and not as agent for
Purchaser.
Section
11.14. Execution;
Successors and Assigns.
This
Agreement may be executed in one or more counterparts and by the different
parties hereto on separate counterparts, each of which, when so executed, shall
be deemed to be an original; such counterparts, together, shall constitute
one
and the same agreement. Subject to Section 7.02, this Agreement shall
inure to the benefit of and be binding upon the Seller and the Purchaser and
their respective successors and assigns.
Section
11.15. Entire
Agreement.
Each
of
the parties to this Agreement acknowledges that no representations, agreements
or promises were made to any of the other parties to this Agreement or any
of
its employees other than those representations, agreements or promises
specifically contained herein. This Agreement and the related
Purchase Price and Terms Letter set forth the entire understanding between
the
parties hereto and shall be binding upon all successors of all of the
parties. In the event of any inconsistency between a Purchase Price
and Terms Letter and this Agreement, this Agreement shall control.
Section
11.16. No
Solicitation.
From
and
after the related Closing Date, except as provided below, the Seller agrees
that
it will not take any action or permit or cause any action to be taken by any
of
its agents or affiliates, or by any independent contractors on the Seller’s
behalf, in any manner to solicit the borrower or obligor under any Mortgage
Loan
to refinance the Mortgage Loan, in whole or in part, without the prior written
consent of the Purchaser. It is understood and agreed that all rights
and benefits relating to the solicitation of any Mortgagors to refinance any
Mortgage Loans and the attendant rights, title and interest in and to the list
of such Mortgagors and data relating to their Mortgages (including insurance
renewal dates) shall be transferred to the Purchaser pursuant hereto on the
related Closing Date and the Seller shall take no action to undermine these
rights and benefits. Notwithstanding the foregoing, it is understood
and agreed that the following promotions or solicitations undertaken by the
Seller or any affiliate of the Seller shall not be prohibited under this Section
11.16: (i) promotions or solicitations that are directed to the
general public at large or segments thereof, provided that no segment shall
consist primarily of the borrowers or obligors under the Mortgage Loans,
including, without limitation, mass mailing based on commercially acquired
mailing lists, newspaper, radio and television advertisements; (ii) responding
to Mortgagor requests for pay-off information and regarding other bank or
financial products or services; and (iii) promotions or solicitations to any
Mortgagor for any other bank or financial products or services, unless such
promotions or solicitations are for a prepayment of a Mortgage
Loan.
Section
11.17. Costs.
The
Purchaser shall pay any commissions due its salesmen, the expenses of its
accountants and attorneys and the expenses and fees of any broker retained
by
the Purchaser with respect to the transactions covered by this
Agreement. To the extent not otherwise provided herein, all other
costs and expenses incurred in connection with the transfer and delivery of
the
Mortgage Loans, including, without limitation, fees for recording
intervening assignments of mortgage and Assignments of Mortgage, the cost of
obtaining tax service contracts and the legal fees and expenses of its attorneys
shall be paid by the Seller. The Seller shall be responsible for
causing the recordation of all Assignments of Mortgage and all intervening
assignments of mortgage, as applicable.
Section
11.18. Protection
of Mortgagor Personal Information.
Each
of
the Purchaser and the Seller agree that it (i) shall comply with any applicable
laws and regulations regarding the privacy and security of Mortgagor Personal
Information, (ii) shall not use Mortgagor Personal Information in any manner
inconsistent with any applicable laws and regulations regarding the privacy
and
security of Mortgagor Personal Information, (iii) shall not disclose Mortgagor
Personal Information to third parties except at the specific written direction
of the other; provided, however, that the Purchaser and the Seller may
disclose Mortgagor Personal Information to third parties in connection with
secondary market transactions to the extent not prohibited by applicable law
or
to the extent required by a valid and effective subpoena issued by a court
of
competent jurisdiction or other governmental body, (iv) shall maintain adequate
physical, technical and administrative safeguards to protect Mortgagor Personal
Information from unauthorized access and (v) shall immediately notify the
other of any actual or suspected breach of the confidentiality of Mortgagor
Personal Information.
[SIGNATURE
PAGE TO FOLLOW]
IN
WITNESS WHEREOF, the Seller and the Purchaser have caused their names to be
signed hereto by their respective officers thereunto duly authorized as of
the
day and year first above written.
|
EMC
MORTGAGE CORPORATION,
|
|
|
as
Purchaser
|
|
|
By:___________________________________
|
|
|
Name:_________________________________
|
|
|
Title:__________________________________
|
|
|
WACHOVIA
MORTGAGE CORPORATION, asSeller
|
|
|
By:___________________________________
|
|
|
Name:_________________________________
|
|
|
Title:__________________________________
|
[Signature
Page to Seller’s Purchase, Warranties and Servicing Agreement, dated as of July
1, 2005]
Exhibit
A-1
Contents
of Mortgage File
With
respect to each Mortgage Loan, the Mortgage File shall include each of the
following items, which shall be available for inspection by the Purchaser,
and
which shall be retained by the Seller in the Servicing File or delivered to
the
Purchaser or its designee pursuant to Sections 2.04 and 2.05 of the Seller’s
Purchase, Warranties and Servicing Agreement.
1. The
original Mortgage Note endorsed “Pay to the order of ___________________ without
recourse,” and signed in the name of the Seller by an authorized officer, with
all intervening endorsements showing a complete chain of title from the
originator to the Seller. If the Mortgage Loan was acquired by the
Seller in a merger, the endorsement must be by “[Seller], successor by merger to
the [name of predecessor]”. If the Mortgage Loan was acquired or
originated by the Seller while doing business under another name, the
endorsement must be by “[Seller] formerly known as [previous
name]”. If the original note is unavailable, seller will provide an
affidavit of lost note (in form acceptable to the Purchaser) stating that the
original Mortgage Note was lost or destroyed, together with a copy of such
Mortgage Note and indemnifying the Purchaser against any and all claims arising
as a result of any person or entity claiming they are the holder of the note
or
that the note has been paid off and returned.
2. A
true certified copy, certified by the [title insurer], of the applicable First
Lien.
3. Except
as provided below and for each Mortgage Loan that is not a MERS Mortgage Loan,
the original Mortgage with evidence of recording thereon, or a copy thereof
certified by the public recording office in which such mortgage has been
recorded or, if the original Mortgage has not been returned from the applicable
public recording office, a true certified copy, certified by the [title
insurer], of the original Mortgage together with a certificate of the Seller
certifying that the original Mortgage has been delivered for recording in the
appropriate public recording office of the jurisdiction in which the Mortgaged
Property is located and in the case of each MERS Mortgage Loan, the original
Mortgage, noting the presence of the MIN of the Mortgage Loans and either
language indicating that the Mortgage Loan is a MOM Loan or if the Mortgage
Loan
was not a MOM Loan at origination, the original Mortgage and the assignment
thereof to MERS, with evidence of recording indicated thereon, or a copy of
the
Mortgage certified by the public recording office in which such Mortgage has
been recorded.
4. The
original or certified to be a true copy or if in electronic form identified
on
the Mortgage Loan Schedule, the certificate number, certified by the Seller,
of
the related Primary Mortgage Insurance Policy, if required.
5. In
the case of each Mortgage Loan that is not a MERS Mortgage Loan, the original
Assignment, from the Seller in accordance with Purchaser’s instructions, which
assignment shall, but for any blanks requested by the Purchaser, be in form
and
substance acceptable for recording, or a copy certified by the Seller as a
true
and correct copy of the original Assignment which has been sent for
recordation. If the Mortgage Loan was acquired or originated by the
Seller while doing business under another name, the Assignment must be by
“[Seller] formerly known as [previous name]”.
6. With
respect to Mortgage Loans that are not Co-op Loans, the original policy of
title
insurance, including riders and endorsements thereto, or if the policy has
not
yet been issued, a written commitment or interim binder or preliminary report
of
title issued by the title insurance or escrow company.
7. Originals
of all recorded intervening Assignments, or copies thereof, certified by the
public recording office in which such Assignments have been recorded showing
a
complete chain of title from the originator to the Seller, with evidence of
recording thereon, or a copy thereof certified by the public recording office
in
which such Assignment has been recorded or, if the original Assignment has
not
been returned from the applicable public recording office, a true certified
copy, certified by the [title insurer] of the original Assignment together
with
a certificate of the [title insurer] certifying that the original Assignment
has
been delivered for recording in the appropriate public recording office of
the
jurisdiction in which the Mortgaged Property is located.
8. Originals,
or copies thereof certified by the public recording office in which such
documents have been recorded, of each assumption, extension, modification,
written assurance or substitution agreements, if applicable, or if the original
of such document has not been returned from the applicable public recording
office, a true certified copy, certified by the [title insurer], of such
original document together with certificate of Seller certifying the original
of
such document has been delivered for recording in the appropriate recording
office of the jurisdiction in which the Mortgaged Property is
located.
9. If
the Mortgage Note or Mortgage or any other material document or instrument
relating to the Mortgage Loan has been signed by a person on behalf of the
Mortgagor, the original power of attorney or other instrument that authorized
and empowered such person to sign bearing evidence that such instrument has
been
recorded, if so required in the appropriate jurisdiction where the Mortgaged
Property is located (or, in lieu thereof, a duplicate or conformed copy of
such
instrument, together with a certificate of receipt from the recording office,
certifying that such copy represents a true and complete copy of the original
and that such original has been or is currently submitted to be recorded in
the
appropriate governmental recording office of the jurisdiction where the
Mortgaged Property is located), or if the original power of attorney or other
such instrument has been delivered for recording in the appropriate public
recording office of the jurisdiction in which the Mortgaged Property is
located.
10. With
respect to a Co-op Loan: (i) a copy of the Co-op Lease and the assignment of
such Co-op Lease to the originator of the Mortgage Loan, with all intervening
assignments showing a complete chain of title and an assignment thereof by
Seller; (ii) the stock certificate together with an undated stock power relating
to such stock certificate executed in blank; (iii) the recognition agreement
in
substantially the same form as standard a “AZTECH” form; (iv) copies of the
financial statement filed by the originator as secured party and, if applicable,
a filed UCC-3 Assignment of the subject security interest showing a complete
chain of title, together with an executed UCC-3 Assignment of such security
interest by the Seller in a form sufficient for filing.
11. The
original of any guarantee executed in connection with the Mortgage
Note.
Notwithstanding
anything to the contrary herein, the Seller may provide one certificate for
all
of the Mortgage Loans indicating that the documents were delivered for
recording.
Exhibit
A-2
Contents
of Servicing File
With
respect to each Mortgage Loan, the Servicing File shall include each of the
following items, which shall be available for inspection by the
Purchaser:
1. Mortgage
Loan closing statement (Form HUD-1) and any other truth-in-lending or real
estate settlement procedure forms required by law.
2. Residential
loan application.
3. Uniform
underwriter and transmittal summary (▇▇▇▇▇▇ ▇▇▇ Form 1008) or reasonable
equivalent.
4. Credit
report on the mortgagor.
5. Business
credit report, if applicable.
6. Residential
appraisal report and attachments thereto.
7. Verification
of employment and income except for Mortgage Loans originated under a Limited
Documentation Program, all in accordance with Seller’s Underwriting
Standards.
8. Verification
of acceptable evidence of source and amount of down payment, in accordance
with
the Underwriting Standards.
9. Photograph
of the Mortgaged Property (may be part of appraisal).
10. Survey
of the Mortgaged Property, if any.
11. Sales
contract, if applicable.
12. If
available, termite report, structural engineer’s report, water portability and
septic certification.
13. Any
original security agreement, chattel mortgage or equivalent executed in
connection with the Mortgage.
14. Any
ground lease, including all amendments, modifications and supplements
thereto.
15. Any
other document required to service the Mortgage Loans.
Exhibit
B
Form
of Custodial Account Letter Agreement
__________________ ,
200_
To:
As
“Seller” under the Seller’s Purchase, Warranties and Servicing Agreement, dated
as of July 1, 2005 (the “Agreement”), we hereby authorize and request you
to establish an account, as a Custodial Account pursuant to Section 4.04 of the
Agreement, to be designated as “Wachovia Mortgage Corporation, in trust for the
Purchaser, owner of various whole loan series - principal and
interest”. All deposits in the account shall be subject to withdrawal
therefrom by order signed by the Seller. This letter is submitted to
you in duplicate. Please execute and return one original to
us.
|
WACHOVIA
MORTGAGE CORPORATION,
|
|
|
as
SELLER
|
|
|
By:__________________________________
|
|
|
Name:________________________________
|
|
|
Title:_________________________________
|
The
undersigned, as “Depository,” hereby certifies that the above described account
has been established under Account Number ______________, at the office of
the
depository indicated above, and agrees to honor withdrawals on such account
as
provided above.
|
__________________________________
|
|
|
By:__________________________________
|
|
|
Name:________________________________
|
|
|
Title:_________________________________
|
Exhibit
C
Form
of Escrow Account Letter Agreement
_____________________,
200_
To:
As
“Seller” under the Seller’s Purchase, Warranties and Servicing Agreement, dated
as of July 1, 2005 (the “Agreement”), we hereby authorize and request you
to establish an account, as an Escrow Account pursuant to Section 4.06 of the
Agreement, to be designated as “Wachovia Mortgage Corporation, in trust for the
Purchaser, owner of various whole loan series, and various
Mortgagors.” All deposits in the account shall be subject to
withdrawal therefrom by order signed by the Seller. This letter is
submitted to you in duplicate. Please execute and return one original
to us.
|
WACHOVIA
MORTGAGE CORPORATION,
|
|
|
as
SELLER
|
|
|
By:__________________________________
|
|
|
Name:________________________________
|
|
|
Title:_________________________________
|
The
undersigned, as “Depository,” hereby certifies that the above described account
has been established under Account Number ______________, at the office of
the
depository indicated above, and agrees to honor withdrawals on such account
as
provided above.
|
By:__________________________________
|
|
|
Name:________________________________
|
|
|
Title:_________________________________
|
Exhibit
D
Form
of Assignment, Assumption and Recognition Agreement
This
Assignment, Assumption and Recognition Agreement (this “Assignment Agreement”),
dated as of _________, among EMC Mortgage Corporation, a Delaware corporation
(the “Assignor”), ______________________, a ________ corporation (the
“Assignee”), and Wachovia Mortgage Corporation, a North Carolina
corporation (the “Seller”):
For
good
and valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the premises and mutual covenants herein contained, the
parties hereto hereby agree as follows:
1. The
Assignor hereby grants, transfers and assigns to Assignee all of the right,
title and interest of Assignor, as Purchaser, in, to and under (a) those certain
mortgage loans listed on Exhibit A attached hereto (the “Mortgage Loans”); and
(b) the Seller’s Purchase, Warranties and Servicing Agreement dated as of July
1, 2005, but only to the extent of the Mortgage Loans (the “Purchase
Agreement”). For purposes of this Assignment Agreement, the term “Purchase
Agreement” includes any separate Assignment and Conveyance pursuant to which
Seller and Assignor effectuated the purchase and sale of any Mortgage Loan
following the execution and delivery of the Purchase Agreement.
The
Assignor specifically reserves and does not assign to the Assignee hereunder
any
and all right, title and interest in, to and under any all obligations of the
Assignor with respect to any mortgage loans subject to the Purchase Agreement
which are not the Mortgage Loans set forth on Exhibit A attached hereto and
are
not the subject of this Assignment Agreement.
2. Each
of the Seller and the Assignor represent and warrant to the Assignee that (a)
the copy of the Purchase Agreement, attached hereto as Exhibit B, provided
to
the Assignee, is a true, complete and accurate copy of the Purchase Agreement,
(b) the Purchase Agreement is in full force and effect as of the date hereof,
(c) the provisions thereof have not been waived, amended or modified in any
respect, nor have any notices of termination been given thereunder, (d) the
Purchase Agreement contains all of the terms and conditions governing the sale
of the Mortgage Loans by Seller to Assignor and the purchase of the Mortgage
Loans by Assignor from Seller; provided, however, that the date of
purchase and sale and the amount of payment for the Mortgage Loans may be set
out in a Purchase Price and Terms Letter, as defined in the Purchase Agreement,
and (e) Seller sold, conveyed and transferred each Mortgage Loan to Assignor
pursuant to the Purchase Agreement.
3. The
Assignor warrants and represents to, and covenants with, the Assignee and the
Seller that:
(a) As
of the date hereof, the Assignor is not in default under the Purchase
Agreement;
(b) The
Assignor is the lawful owner of the Mortgage Loans with the full right to
transfer the Mortgage Loans and any and all of its interests, rights and
obligations under the Purchase Agreement, free from any and all claims and
encumbrances arising out of the Assignor’s ownership thereof, and the Mortgage
Loans, as well as the Purchase Agreement, upon the transfer thereof to the
Assignee as contemplated herein, shall be free and clear of all such liens,
claims and encumbrances or any lien claim or encumbrance arising out of the
ownership of the Mortgage Loans by any person at any time after Assignor first
acquired any Mortgage Loan from the Seller;
(c) The
Assignor has not received notice of, and has no knowledge of, any offsets,
counterclaims or other defenses available to the Seller with respect to the
Purchase Agreement or the Mortgage Loans;
(d) The
Assignor has not waived or agreed to any waiver under, or agreed to any
amendment or other modification of, the Purchase Agreement or the Mortgage
Loans. The Assignor has no knowledge of, and has not received notice of, any
waivers under or amendments or other modifications of, or assignments of rights
or obligations under or defaults under, the Purchase Agreement, or the Mortgage
Loans;
(e) The
Assignor is a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation, and has all requisite
corporate power and authority to sell, transfer and assign the Mortgage
Loans;
(f) The
Assignor has full corporate power and authority to execute, deliver and perform
under this Assignment Agreement, and to consummate the transactions set forth
herein. The consummation of the transactions contemplated by this Assignment
Agreement is in the ordinary course of the Assignor’s business and will not
conflict with, or result in a breach of, any of the terms, conditions or
provisions of the Assignor’s charter or by-laws, or any legal restriction, or
any material agreement or instrument to which the Assignor is now a party or
by
which it is bound, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Assignor or its property is subject.
The
execution, delivery and performance by the Assignor of this Assignment
Agreement, and the consummation by it of the transactions contemplated hereby,
have been duly authorized by all necessary corporate action of the Assignor.
This Assignment Agreement has been duly executed and delivered by the Assignor
and constitutes the valid and legally binding obligation of the Assignor
enforceable against the Assignor in accordance with its respective terms except
as enforceability thereof may be limited by bankruptcy, insolvency, or
reorganization or other similar laws now or hereinafter in effect relating
to
creditor’s rights generally and by general principles of equity, regardless of
whether such enforceability is considered in a proceeding in equity or in
law;
(g) No
material consent, approval, order or authorization of, or declaration, filing
or
registration with, any governmental entity is required to be obtained or made
by
the Assignor in connection with the execution, delivery or performance by the
Assignor of this Assignment Agreement, or the consummation by it of the
transactions contemplated hereby; and
(h) The
Assignor has paid the purchase price for the Mortgage Loans and has satisfied
any conditions to closing required of it under the terms of the Purchase
Agreement.
4. The
Assignee warrants and represents to, and covenants with, the Assignor and the
Seller that:
(a) The
Assignee is a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation, and has all requisite
corporate power and authority to acquire, own and purchase the Mortgage
Loans;
(b) The
Assignee has full corporate power and authority to execute, deliver and perform
under this Assignment Agreement, and to consummate the transactions set forth
herein. The consummation of the transactions contemplated by this Assignment
Agreement is in the ordinary course of the Assignee’s business and will not
conflict with, or result in a breach of, any of the terms, conditions or
provisions of the Assignee’s charter or by-laws, or any legal restriction, or
any material agreement or instrument to which the Assignee is now a party or
by
which it is bound, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Assignee or its property is subject.
The
execution, delivery and performance by the Assignee of this Assignment
Agreement, and the consummation by it of the transactions contemplated hereby,
have been duly authorized by all necessary corporate action of the Assignee.
This Assignment Agreement has been duly executed and delivered by the Assignee
and constitutes the valid and legally binding obligation of the Assignee
enforceable against the Assignee in accordance with its respective terms except
as enforceability thereof may be limited by bankruptcy, insolvency, or
reorganization or other similar laws now or hereinafter in effect relating
to
creditor’s rights generally and by general principles of equity, regardless of
whether such enforceability is considered in a proceeding in equity or in
law;
(c) No
material consent, approval, order or authorization of, or declaration, filing
or
registration with, any governmental entity is required to be obtained or made
by
the Assignee in connection with the execution, delivery or performance by the
Assignee of this Assignment Agreement, or the consummation by it of the
transactions contemplated hereby; and
(d) The
Assignee agrees to be bound, as Purchaser, by all of the terms, covenants and
conditions of the Purchase Agreement and the Mortgage Loans, and from and after
the date hereof, the Assignee assumes for the benefit of each of the Seller
and
the Assignor all of the Assignor’s obligations as Purchaser thereunder, with
respect to the Mortgage Loans.
5. The
Seller warrants and represents to, and covenants with, the Assignor and the
Assignee that:
(a) The
Seller is not a natural person or a general partnership and is duly organized,
validly existing and in good standing under the laws of the jurisdiction of
its
formation, and has all requisite power and authority to service the Mortgage
Loans;
(b) The
Seller has full power and authority to execute, deliver and perform under this
Assignment Agreement, and to consummate the transactions set forth herein.
The
consummation of the transactions contemplated by this Assignment Agreement
is in
the ordinary course of the Seller’s business and will not conflict with, or
result in a breach of, any of the terms, conditions or provisions of the
Seller’s charter or by-laws, or any legal restriction, or any material agreement
or instrument to which the Seller is now a party or by which it is bound, or
result in the violation of any law, rule, regulation, order, judgment or decree
to which the Seller or its property is subject. The execution, delivery and
performance by the Seller of this Assignment Agreement, and the consummation
by
it of the transactions contemplated hereby, have been duly authorized by all
necessary corporate action of the Seller. This Assignment Agreement has been
duly executed and delivered by the Seller and constitutes the valid and legally
binding obligation of the Seller enforceable against the Seller in accordance
with its respective terms except as enforceability thereof may be limited by
bankruptcy, insolvency, or reorganization or other similar laws now or
hereinafter in effect relating to creditors’ rights generally and by general
principles of equity, regardless of whether such enforceability is considered
in
a proceeding in equity or in law;
(d) No
material consent, approval, order or authorization of, or declaration, filing
or
registration with, any governmental entity is required to be obtained or made
by
the Seller in connection with the execution, delivery or performance by the
Seller of this Assignment Agreement, or the consummation by it of the
transactions contemplated hereby;
(e) As
of the date hereof, the Seller is not in default under the Purchase Agreement;
and
(f) No
event has occurred or has failed to occur, during the period commencing on
date
on which Assignor acquired the Mortgage Loans and ending on the date hereof,
inclusive, which would make the representations and warranties set forth in
Section 3.01 of the Purchase Agreement untrue if such representations and
warranties were made with respect to the Mortgage Loans effective as of the
date
hereof.
6. From
and after the date hereof, the Seller shall recognize the Assignee as the owner
of the Mortgage Loans, and shall look solely to the Assignee for performance
from and after the date hereof of the Assignor’s obligations with respect to the
Mortgage Loans.
7. Notice
Addresses.
(a) The
Assignee’s address for purposes of all notices and correspondence related to the
Mortgage Loans and this Assignment Agreement is:
________________
________________
________________
Attention:
________________
(b) The
Assignor’s address for purposes for all notices and correspondence related to
the Mortgage Loans and this Assignment Agreement is:
[_____________________________]
[_____________________________]
[_____________________________]
[_____________________________]
Attention:
_______________
(c) The
Seller’s address for purposes of all notices and correspondence related to the
Mortgage Loans and this Assignment Agreement is:
Wachovia
Mortgage Corporation
▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇ ▇▇▇▇▇▇
8. This
Assignment Agreement shall be construed in accordance with the substantive
laws
of the State of New York (without regard to conflict of laws principles) and
the
obligations, rights and remedies of the parties hereunder shall be determined
in
accordance with such laws, except to the extent preempted by federal
law.
9. This
Assignment Agreement shall inure to the benefit of the successors and assigns
of
the parties hereto. Any entity into which the Seller, the Assignor or the
Assignee may be merged or consolidated shall, without the requirement for any
further writing, be deemed the Seller, the Assignor or the Assignee,
respectively, hereunder.
10. No
term or provision of this Assignment Agreement may be waived or modified unless
such waiver or modification is in writing and signed by the party against whom
such waiver or modification is sought to be enforced.
11. This
Assignment Agreement shall survive the conveyance of the Mortgage Loans and
the
assignment of the Purchase Agreement by the Assignor.
12. Notwithstanding
the assignment of the Purchase Agreement by either the Assignor or Assignee,
this Assignment Agreement shall not be deemed assigned by the Seller or the
Assignor unless assigned by separate written instrument.
13. For
the purpose for facilitating the execution of this Assignment Agreement as
herein provided and for other purposes, this Assignment Agreement may be
executed simultaneously in any number of counterparts, each of which
counterparts shall be deemed to be an original, and such counterparts shall
constitute and be one and the same instrument.
[signatures
on following page]
IN
WITNESS WHEREOF, the parties have caused this Assignment Agreement to be
executed by their duly authorized officers as of the date first above
written.
|
EMC
Mortgage Corporation
|
|
|
Assignor
|
|
|
By:______________________________________
|
|
|
Name:____________________________________
|
|
|
Title:_____________________________________
|
|
|
[[_______________________________________]
|
|
|
Assignee
|
|
|
By:______________________________________
|
|
|
Name:____________________________________
|
|
|
Title:_____________________________________
|
|
|
Wachovia
Mortgage Corporation
|
|
|
Seller
|
|
|
By:______________________________________
|
|
|
Name:____________________________________
|
|
|
Title:_____________________________________
|
Exhibit
E
Form
of Assignment and Conveyance
On
this
____ day of ________, 200_, Wachovia Mortgage Corporation (“Wachovia”) as
the Seller under that certain Seller’s Purchase, Warranties and Servicing
Agreement, dated as of July 1, 2005 (the “Agreement”), by and
between Wachovia and EMC Mortgage Corporation (the “Purchaser”) does
hereby sell, transfer, assign, set over and convey to the Purchaser under the
Agreement, without recourse, but subject to the terms of the Agreement, all
rights, title and interest of Wachovia (excluding the right to service the
Mortgage Loans) in and to the Mortgage Loans listed on the Mortgage Loan
Schedule attached hereto as Exhibit A, together with the Mortgage Files
and all rights and obligations arising under the documents contained
therein.
Pursuant
to Section 2.07 of the Agreement, Wachovia has delivered to the Purchaser the
documents for each Mortgage Loan to be purchased as set forth
therein. The contents of each Servicing File required to be retained
by Wachovia to service the Mortgage Loans pursuant to the Agreement and thus
not
delivered to the Purchaser are and shall be held in trust by Wachovia, for
the
benefit of the Purchaser as the owner thereof. Wachovia’s possession
of any portion of the Servicing File is at the will of the Purchaser for the
sole purpose of facilitating servicing of the related Mortgage Loan pursuant
to
the Agreement, and such retention and possession by Wachovia shall be in a
custodial capacity only. The ownership of each Mortgage Note,
Mortgage, and the contents of the Mortgage File and Servicing File is vested
in
the Purchaser and the ownership of all records and documents with respect to
the
related Mortgage Loan prepared by or which come into the possession of Wachovia
shall immediately vest in the Purchaser and shall be retained and maintained,
in
trust, by Wachovia at the will of the Purchaser in such custodial capacity
only.
[Remainder
of page intentionally blank - signature page follows]
Capitalized
terms used herein and not otherwise defined shall have the meanings set forth
in
the Agreement.
|
WACHOVIA
MORTGAGE CORPORATION
|
|
|
By:_______________________________________
|
|
|
Name:_____________________________________
|
|
|
Title:______________________________________
|
Exhibit
F
Request
for Release of Documents and Receipt
RE: Mortgage
Loan #___________________________________
BORROWER: __________________________________________________
PROPERTY: __________________________________________________
Pursuant
to a Seller’s Purchase, Warranties and Servicing Agreement (the
“Agreement”) between the Seller and the Purchaser, the undersigned hereby
certifies that he or she is an officer of the Seller requesting release of
the
documents for the reason specified below. The undersigned further
certifies that:
(Check
one of the items below)
|
_____
|
On
_________________, the above captioned mortgage loan was paid in
full or
the Seller has been notified that payment in full has been or will
be
escrowed. The Seller hereby certifies that all amounts with
respect to this loan which are required under the Agreement have
been or
will be deposited in the Custodial Account as required.
|
|
_____
|
The
above captioned loan is being repurchased pursuant to the terms of
the
Agreement. The Seller hereby certifies that the repurchase
price has been credited to the Custodial Account as required under
the
Agreement.
|
|
_____
|
The
above captioned loan is being placed in foreclosure and the original
documents are required to proceed with the foreclosure
action. The Seller hereby certifies that the documents will be
returned to the Purchaser in the event of
reinstatement.
|
|
_____
|
Other
(explain)
|
|
_______________________________________________________
_______________________________________________________
|
All
capitalized terms used herein and not defined shall have the meanings assigned
to them in the Agreement.
Based
on
this certification and the indemnities provided for in the Agreement, please
release to the Seller all original mortgage documents in your possession
relating to this loan.
|
Dated:_________________
|
By:________________________________
|
|
|
Signature
|
||
|
___________________________________
|
||
|
Title
|
||
|
Send
documents to:
|
_____________________________________________
|
|
|
_____________________________________________
|
||
|
_____________________________________________
|
||
|
Acknowledgment:
|
||
|
Purchaser
hereby acknowledges that all original documents previously released
on the
above captioned mortgage loan have been returned and received by
the
Purchaser.
|
||
|
Dated:________________
|
By:________________________________
|
|
|
Signature
|
||
|
Title:____________________________
|
||
EXHIBIT
G
RECONSTITUTED
MORTGAGE LOAN REPORTING
|
IP1270
FIELD NAME
|
DESCRIPTION
|
|
MACCTNO
|
Investor
Loan Number
|
|
MSRVACCT
|
Servicer
Loan Number
|
|
MSERVID
|
blank
|
|
MCUTOFF
|
Cutoff
Date
|
|
MINVSTR
|
Investor
Number
|
|
MCATNUM
|
Category
Number
|
|
MNOTRAT
|
Note
Rate
|
|
MSRVFEE
|
Service
Fee Rate
|
|
MPTRAT
|
Pass
Thru Rate
|
|
MBSCHBAL
|
Beginning
Scheduled Principal Balance
|
|
MPICONST
|
P&I
Constant
|
|
MSCHINT
|
Scheduled
Gross Interest
|
|
MPTINT
|
Scheduled
Net Interest
|
|
MSCHPRN
|
Scheduled
Principal
|
|
MLIQPRN
|
PIF
Principal
|
|
MLIQINT
|
PIF
Interest
|
|
MADDPRN
|
Curtailment
|
|
MADDTRN
|
Cutoff
Date Curtailment Collected
|
|
MPRNADJ
|
Adjustment
|
|
MSCHPYMT
|
Total
Scheduled Payment
|
|
MTOTREMIT
|
Total
Remittance Due
|
|
MESCHBAL
|
Ending
Scheduled Principal Balance
|
|
MBPRIBAL
|
Beginning
Actual Principal Balance
|
|
MEPRIBAL
|
Ending
Actual Principal Balance
|
|
MDUEDATE
|
Due
Date
|
|
MPRNCOLL
|
Principal
Collected
|
|
MSRFCOLL
|
Interest
Collected
|
|
MLIQCDE
|
Liquidation
Code
|
|
MLIQDTE
|
Liquidation
Date
|
|
MARMNOT
|
ARM
Note Rate
|
EXHIBIT
H
SELLER’S
OBLIGATIONS IN CONNECTION
WITH
A
RECONSTITUTION
|
·
|
The
Seller shall: (i) possess the ability to service under customary
securitization documents; (ii) service on a “Scheduled/Scheduled”
reporting basis (advancing through the liquidation of an REO Property);
(iii) make compensating interest payments on payoffs and curtailments;
and
(iv) remit and report to a master servicer in format reasonably acceptable
to such master servicer and the Seller by the 10th calendar day of
each
month.
|
|
·
|
The
Seller shall provide an acceptable annual certification (officer’s
certificate) to the master servicer (as required by the ▇▇▇▇▇▇▇▇-▇▇▇▇▇
Act
of 2002) to the extent a Form 10-K or other required filing is made
with respect to the securitization, as well as any other annual
certifications required under the securitization documents (i.e.,
the
annual statement as to compliance/annual independent certified public
accountants’ servicing report due by March 15 of each
year).
|
|
·
|
The
Seller shall allow for the Purchaser, the master servicer or their
designee to perform a review of audited financials and net worth
of the
Company.
|
|
·
|
The
Seller shall provide a customary Uniform Single Attestation Program
certificate and Management Assertion as requested by the master servicer
or the Purchaser.
|
|
·
|
The
Seller shall provide information on each Custodial Account as reasonably
requested by the master servicer or the Purchaser, and each Custodial
Account shall comply with the reasonable requirements for such accounts
as
set forth in the securitization
documents.
|
EXECUTION
COPY
REGULATION
AB COMPLIANCE ADDENDUM TO SELLER’S PURCHASE, WARRANTIES AND SERVICING
AGREEMENT
(Servicing-retained)
This
Regulation AB Compliance Addendum (this “Reg AB Addendum”), dated as of
March 28, 2006, by and between EMC Mortgage Corporation (the “Purchaser”)
and Wachovia Mortgage Corporation (the “Company”), to that certain
Seller’s Purchase, Warranties and Servicing Agreement, dated as of July 1, 2005,
by and between the Company and the Purchaser (as amended, modified or
supplemented, the “Agreement”).
WITNESSETH
WHEREAS,
the Company and the Purchaser have agreed to adopt an addendum to the Agreement
to reflect the intention of the parties to comply with Regulation
AB.
NOW,
THEREFORE, in consideration of the mutual promises and mutual obligations set
forth herein, the Company and the Purchaser hereby agree as
follows:
ARTICLE
I
DEFINED
TERMS
Capitalized
terms used but not defined herein shall have the meanings assigned to such
terms
in the Agreement. The following terms shall have the meanings set
forth below, unless the context clearly indicates otherwise:
Commission:
The United States Securities and Exchange Commission.
Company
Information: As defined in Section 2.07(a).
Depositor:
With respect to any Securitization Transaction, the Person identified in writing
to the Company by the Purchaser as depositor for such Securitization
Transaction.
Exchange
Act: The Securities Exchange Act of 1934, as amended.
Qualified
Correspondent: Any Person from which the Company purchased Mortgage Loans,
provided that the following conditions are satisfied: (i) such
Mortgage Loans were originated pursuant to an agreement between the Company
and
such Person that contemplated that such Person would underwrite mortgage loans
from time to time, for sale to the Company, in accordance with underwriting
guidelines designated by the Company (“Designated Guidelines”) or
guidelines that do not vary materially from such Designated Guidelines; (ii)
such Mortgage Loans were in fact underwritten as described in clause (i) above
and substantially all such Mortgage Loans were acquired by the Company within
180 days after origination; (iii) either (x) the Designated Guidelines were,
at
the time such Mortgage Loans were originated, used by the Company in origination
of mortgage loans of the same type as the Mortgage Loans for the Company’s own
account or (y) the Designated Guidelines were, at the time such Mortgage Loans
were underwritten, designated by the Company on a consistent basis for use
by
lenders in
originating
mortgage loans to be purchased by the Company; and (iv) the Company employed,
at
the time such Mortgage Loans were acquired by the Company, pre-purchase or
post-purchase quality assurance procedures (which may involve, among other
things, review of a sample of mortgage loans purchased during a particular
time
period or through particular channels) designed to ensure that Persons from
which it purchased mortgage loans properly applied the underwriting criteria
designated by the Company.
Master
Servicer: With respect to any Securitization Transaction, the “master
servicer,” if any, identified in the related transaction documents.
Regulation
AB: Subpart 229.1100 – Asset Backed Securities (Regulation AB), 17 C.F.R.
§§229.1100-229.1123, as such may be amended from time to time, and subject
to
such clarification and interpretation as have been provided by the Commission
in
the adopting release (Asset-Backed Securities, Securities Act Release No.
33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff of the
Commission, or as may be provided by the Commission or its staff from time
to
time.
Securities
Act: The Securities Act of 1933, as amended.
Securitization
Transaction: Any transaction involving either (1) a sale or other transfer
of some or all of the Mortgage Loans directly or indirectly by the Purchaser
to
an issuing entity in connection with an issuance of publicly offered or
privately placed, rated or unrated mortgage-backed securities or (2) an issuance
of publicly offered or privately placed, rated or unrated securities, the
payments on which are determined primarily by reference to one or more
portfolios of residential mortgage loans consisting, in whole or in part, of
some or all of the Mortgage Loans.
Servicer:
As defined in Section 2.03(c).
Servicing
Criteria: The “servicing criteria” set forth in Item 1122(d) of Regulation
AB, as such may be amended from time to time, and as set forth on Exhibit
B.
Sponsor:
With respect to any Securitization Transaction, the Person identified in writing
to the Company by the Purchaser as sponsor for such Securitization
Transaction.
Static
Pool Information: Static pool information as described in Item
1l05(a)(l)-(3) and 1105(c) of Regulation AB.
Subcontractor:
Any vendor, subcontractor or other Person that is not responsible for the
overall servicing (as “servicing” is commonly understood by participants in the
mortgage-backed securities market) of Mortgage Loans but performs one or more
discrete functions identified in Item l122(d) of Regulation AB with respect
to
Mortgage Loans under the direction or authority of the Company or a
Subservicer.
Subservicer:
Any Person that services Mortgage Loans on behalf of the Company or any
Subservicer and is responsible for the performance (whether directly or through
Subservicers or Subcontractors) of a substantial portion of the material
servicing functions identified in Item 1122(d) of Regulation AB that are
required to be performed by the Company under this Agreement or any
Reconstitution Agreement.
Third-Party
Originator: Each Person, other than a Qualified Correspondent, that
originated Mortgage Loans acquired by the Company.
Whole
Loan Transfer: Any sale or transfer by the Purchaser of some or all of the
Mortgage Loans, other than a Securitization Transaction.
ARTICLE
II
COMPLIANCE
WITH REGULATION AB
Section
2.01. Intent of the Parties; Reasonableness.
The
Purchaser and the Company acknowledge and agree that the purpose of Article
II
of this Reg AB Addendum is to facilitate compliance by the Purchaser and any
Depositor with the provisions of Regulation AB and related rules and regulations
of the Commission and that the provisions of this Reg AB Addendum shall be
applicable to all Mortgage Loans included in a Securitization Transaction
closing on or after January 1, 2006, regardless whether the Mortgage Loans
were
purchased by the Purchaser from the Company prior to the date
hereof. Although Regulation AB is applicable by its terms only to
offerings of asset-backed securities that are registered under the Securities
Act, the Company acknowledges that investors in privately offered securities
may
require that the Purchaser or any Depositor provide comparable disclosure in
unregistered offerings. References in this Agreement to compliance with
Regulation AB include provision of comparable disclosure in private
offerings.
Neither
the Purchaser nor any Depositor shall exercise its right to request delivery
of
information or other performance under these provisions other than in good
faith, or for purposes other than compliance with the Securities Act, the
Exchange Act and the rules and regulations of the Commission thereunder (or
the
provision in a private offering of disclosure comparable to that required under
the Securities Act). The Company acknowledges that interpretations of
the requirements of Regulation AB may change over time, whether due to
interpretive guidance provided by the Commission or its staff, consensus among
participants in the asset-backed securities markets, advice of counsel, or
otherwise, and agrees to comply with reasonable requests made by the Purchaser,
any Master Servicer or any Depositor in good faith for delivery of information
under these provisions on the basis of evolving interpretations of Regulation
AB. In connection with any Securitization Transaction, the Company shall
cooperate with the Purchaser to deliver to the Purchaser (including any of
its
assignees or designees), any Master Servicer and any Depositor, any and all
statements, reports, certifications, records and any other information necessary
in the good faith determination of the Purchaser, any Master Servicer or any
Depositor to permit the Purchaser, such Master Servicer or such Depositor to
comply with the provisions of Regulation AB, together with such disclosures
relating to the Company, any Subservicer, any Third-Party Originator and the
Mortgage Loans, or the servicing of the Mortgage Loans, reasonably believed
by
the Purchaser or any Depositor to be necessary in order to effect such
compliance.
The
Purchaser and the Company also acknowledge and agree Section 2.02(a)(i)-(v),
Section 2.03(c), (e) and (f), Section 2.04, Section 2.05 and Section 2.06 of
this Reg AB Addendum shall only be applicable with respect to any Mortgage
Loan
if the Company (or Subservicer, if any) services such Mortgage Loan following
the closing date of a related Securitization Transaction. The
Purchaser and the Company also acknowledge and agree that this Reg AB Addendum
is intended to supplement the terms of the Agreement and, to the extent
inconsistent, the rights and obligations under the Agreement shall continue
to
apply with respect to any Reconstitution (as defined in the
Agreement) that is not covered by the definition of “Securitization
Transaction” in this Reg AB Addendum; provided, however, that the requirement to
provide an accountants’ report pursuant to Section 6.05 of the Agreement shall
be deemed satisfied with respect to any Reconstitution that occurs on or
following the date hereof by providing an accountants’ attestation that
satisfies the requirements of Section 2.05(a)(ii) of this Reg AB
Addendum.
For
purposes of this Reg AB Addendum, the term “Purchaser” shall refer to EMC
Mortgage Corporation and its successors in interest and assigns. In
addition, other than notices provided pursuant to Section 2.03(d) of this Reg
AB
Addendum, any notice or request that must be “in writing” or “written” may be
made by electronic mail.
Section
2.02. Additional Representations and Warranties of the
Company.
(a)
The
Company shall be deemed to represent to the Purchaser and to any Depositor,
as
of the date on which information is first provided to the Purchaser or any
Depositor under Section 2.03 that, except as disclosed in writing to the
Purchaser or such Depositor prior to such date: (i) the Company is not aware
and
has not received notice that any default, early amortization or other
performance triggering event has occurred as to any other securitization due
to
any act or failure to act of the Company; (ii) the Company has not been
terminated as servicer in a residential mortgage loan securitization, either
due
to a servicing default or to application of a servicing performance test or
trigger; (iii) no material noncompliance with the applicable servicing criteria
with respect to other securitizations of residential mortgage loans involving
the Company as servicer has been disclosed or reported by the Company; (iv)
no
material changes to the Company’s policies or procedures with respect to the
servicing function it will perform under this Agreement and any Reconstitution
Agreement for mortgage loans of a type similar to the Mortgage Loans have
occurred during the three-year period immediately preceding the related
Securitization Transaction; (v) there are no aspects of the Company’s financial
condition that are reasonably expected to have a material adverse effect on
the
performance by the Company of its servicing obligations under this Agreement
or
any Reconstitution Agreement; (vi) there are no legal or governmental
proceedings pending (or known to be contemplated) against the Company, any
Subservicer or any Third-Party Originator that would be material to
securityholders; and (vii) there are no affiliations, relationships or
transactions relating to the Company, any Subservicer or any Third-Party
Originator with respect to any Securitization Transaction and any party thereto
identified in writing to the Company by the related Depositor of a type
described in Item 1119 of Regulation AB.
(b)
If so
requested in writing by the Purchaser or any Depositor on any date following
the
date on which information is first provided to the Purchaser or any
Depositor under Section 2.03, the Company shall use its reasonable best efforts
to within five (5) Business Days, but in no
event
later than seven (7) Business Days, following such request, confirm in writing
the accuracy of the representations and warranties set forth in paragraph (a)
of
this Section or, if any such representation and warranty is not accurate as
of
the date of such request, provide reasonably adequate disclosure of the
pertinent facts, in writing, to the requesting party.
Section
2.03. Information to Be Provided by the Company.
In
connection with any Securitization Transaction, the Company shall (i) use its
reasonable best efforts to within five (5) Business Days, but in no event later
than seven (7) Business Days, following written request by the Purchaser or
any
Depositor, provide to the Purchaser and such Depositor (or, as applicable,
cause
each Third-Party Originator and each Subservicer to provide), in writing and
in
form and substance reasonably satisfactory to the Purchaser and such Depositor,
the information and materials specified in paragraphs (a), (b),
(c),
(f)
and
(g) of this Section, and (ii) as promptly as practicable following notice to
or
discovery by the Company, provide to the Purchaser and any Depositor (in writing
and in form and substance reasonably satisfactory to the Purchaser and such
Depositor) the information specified in paragraph (d) of this
Section.
(a)
If so
requested in writing by the Purchaser or any Depositor, the Company shall
provide such information regarding (i) the Company, as originator of the
Mortgage Loans (including as an acquirer of Mortgage Loans from a Qualified
Correspondent), or (ii) each Third-Party Originator, and (iii) as applicable,
each Subservicer, as is reasonably requested for the purpose of compliance
with
Items 1103(a)(l), 1105, 1110, 1117 and 1119 of Regulation AB. Such information
shall include, at a minimum (so long as required by Regulation AB):
(A)
the
originator’s form of organization;
(B)
a
description of the originator’s origination program and how long the originator
has been engaged in originating residential mortgage loans, which description
shall include a discussion of the originator’s experience in originating
mortgage loans of a similar type as the Mortgage Loans; information regarding
the size and composition of the originator’s origination portfolio; and
information that may be material, in the good faith judgment of the Purchaser
or
any Depositor, to an analysis of the performance of the Mortgage Loans,
including the originators’ credit-granting or underwriting criteria for mortgage
loans of similar type(s) as the Mortgage Loans and such other information as
the
Purchaser or any Depositor may reasonably request for the purpose of compliance
with Item 1110(b)(2) of Regulation AB;
(C)
a
description of any legal or governmental proceedings pending (or known to be
contemplated) against the Company, each Third-Party Originator and each
Subservicer that would be material to securityholders; and
(D)
a
description of any affiliation or relationship between the Company, each
Third-Party Originator, each Subservicer and any of the following parties to
a
Securitization Transaction, as such parties are identified to the Company by
the
Purchaser or any Depositor in writing in advance of such Securitization
Transaction:
(1)
the
sponsor;
(2)
the
depositor;
(3)
the
issuing entity;
(4)
any
servicer;
(5)
any
trustee;
(6)
any
originator;
(7)
any
significant obligor;
(8)
any
enhancement or support provider; and
(9)
any
other material transaction party.
(b)
If so
requested in writing by the Purchaser or any Depositor, the Company shall
provide (or, as applicable, cause each Third-Party Originator to provide)
vintage origination year Static Pool Information with respect to mortgage loans
of a similar type as the Mortgage Loans (as reasonably identified by the
Purchaser as provided below) originated by (i) the Company, if the Company
is an
originator of Mortgage Loans (including as an acquirer of Mortgage Loans from
a
Qualified Correspondent), and/or (ii) each Third-Party Originator, but in each
case only to the extent that (x) such mortgage loans were originated after
July
2004 and (y) (A) the Company has not sold such mortgage loans on a
servicing-released basis or (B) such information relates to “original
characteristics” as described in Item 1105(a)(3)(iii) of Regulation AB.
Notwithstanding the preceding sentence, the Company shall not be required to
provide Static Pool Information regarding cumulative losses with respect to
any
mortgage loans originated prior to January 1, 2006, which information is
unavailable to the Company without unreasonable effort or expense. Such Static
Pool Information shall be prepared by the Company (or Third-Party Originator)
on
the basis of its reasonable, good faith interpretation of the requirements
of
Item 1105(a)(2)-(3) of Regulation AB. To the extent that there is
reasonably available to the Company (or Third-Party Originator) Static Pool
Information with respect to more than one mortgage loan type, the Purchaser
or
any Depositor shall be entitled to specify whether some or all of such
information shall be provided pursuant to this paragraph. The content
of such Static Pool Information may be in the form customarily provided by
the
Company, and need not be customized for the Purchaser or any
Depositor. Such Static Pool Information for each vintage origination
year shall be presented in increments no less frequently than quarterly over
the
life of the mortgage loans included in the vintage origination
year. The most recent periodic increment must be as of a date no
later than 135 days prior to the date of the prospectus or other offering
document in which the Static Pool Information is to be included or incorporated
by reference. The Static Pool Information shall be provided in an electronic
format that provides a permanent record of the information provided, such as
a
portable document format (pdf) file, or other such electronic format reasonably
required by the Purchaser or the Depositor, as applicable.
Promptly
following notice or discovery of a material error in Static Pool Information
provided pursuant to the immediately preceding paragraph (including an omission
to include therein information required to be provided pursuant to such
paragraph) during the applicable offering period for the securities, the Company
shall provide corrected Static Pool Information to the Purchaser or any
Depositor, as applicable, in the same format in which Static Pool Information
was previously provided to such party by the Company.
If
so
requested in writing by the Purchaser or any Depositor, the Company shall
provide (or, as applicable, cause each Third-Party Originator to provide),
at
the expense of the requesting party (to the extent of any additional incremental
expense associated with delivery pursuant to this Reg AB Addendum), such
statements and agreed-upon procedures letters of certified public accountants
reasonably acceptable to the Purchaser or Depositor, as applicable, pertaining
to Static Pool Information relating to calendar months commencing January 1,
2006, as the Purchaser or such Depositor shall reasonably
request. Such statements and letters shall be addressed to and be for
the benefit of such parties as the Purchaser or such Depositor shall designate,
which may include, by way of example, any Sponsor, any Depositor and any broker
dealer acting as underwriter, placement agent or initial purchaser with respect
to a Securitization Transaction. Any such statement or letter may
take the form of a standard, generally applicable document accompanied by a
reliance letter authorizing reliance by the addressees designated by the
Purchaser or such Depositor.
(c)
If so
requested in writing by the Purchaser or any Depositor with respect to any
Securitization Transaction for which 20% or more of the pool assets (measured
by
cut-off date principal balance) are serviced by the Company and any Subservicer
or as otherwise required by Item 1108 of Regulation AB, the Company shall
provide such information regarding the Company, as servicer of the Mortgage
Loans, and each Subservicer (each of the Company and each Subservicer, for
purposes of this paragraph, a “Servicer”), as is reasonably requested for
the purpose of compliance with Item 1108 of Regulation AB. Such
information shall include, at a minimum (so long as required by Regulation
AB):
(A)
the
Servicer’s form of organization;
(B)
a
description of how long the Servicer has been servicing residential mortgage
loans; a general discussion of the Servicer’s experience in servicing assets of
any type as well as a more detailed discussion of the Servicer’s experience in,
and procedures for, the servicing function it will perform under the Agreement
and any Reconstitution Agreements; information regarding the size, composition
and growth of the Servicer’s portfolio of residential mortgage loans of a type
similar to the Mortgage Loans and information on factors related to the Servicer
that may be material, in the good faith judgment of the Purchaser or any
Depositor, to any analysis of the servicing of the Mortgage Loans or the related
asset-backed securities, as applicable, including, without
limitation:
(1)
whether the Servicer is aware of or has received notice that any prior
securitizations of mortgage loans of a type similar to the Mortgage Loans
involving the Servicer have defaulted or experienced an early amortization
or
other performance triggering event because of servicing by the Servicer during
the three-year period immediately preceding the related Securitization
Transaction;
(2)
the
extent of outsourcing the Servicer utilizes;
(3)
whether there has been previous disclosure of material noncompliance with the
applicable servicing criteria with respect to other securitizations of
residential mortgage loans involving the Servicer as a servicer during the
three-year period immediately preceding the related Securitization
Transaction;
(4)
whether the Servicer has been terminated as servicer in a residential mortgage
loan securitization, either due to a servicing default or to application of
a
servicing performance test or trigger; and
(5)
such
other information as the Purchaser or any Depositor may reasonably request
for
the purpose of compliance with Item 1108(b)(2) of Regulation AB;
(C)
a
description of any material changes during the three-year period immediately
preceding the related Securitization Transaction to the Servicer’s policies or
procedures with respect to the servicing function it will perform under the
Agreement and any Reconstitution Agreements for mortgage loans of a type similar
to the Mortgage Loans;
(D)
information regarding the Servicer’s financial condition, to the extent that
there is a material risk that an adverse financial event or circumstance
involving the Servicer could have a material adverse effect on the performance
by the Company of its servicing obligations under the Agreement or any
Reconstitution Agreement;
(E)
information regarding advances made by the Servicer on the Mortgage Loans and
the Servicer’s overall servicing portfolio of residential mortgage loans for the
three-year period immediately preceding the related Securitization Transaction,
which may be limited to a statement by an authorized officer of the Servicer
to
the effect that the Servicer has made all advances required to be made on
residential mortgage loans serviced by it during such period, or, if such
statement would not be accurate, information regarding the percentage and type
of advances not made as required, and the reasons for such failure to
advance;
(F)
a
description of the Servicer’s processes and procedures designed to address any
special or unique factors involved in servicing loans of a similar type as
the
Mortgage Loans;
(G)
a
description of the Servicer’s processes for handling delinquencies, losses,
bankruptcies and recoveries, such as through liquidation of mortgaged
properties, sale of defaulted mortgage loans or workouts; and
(H)
information as to how the Servicer defines or determines delinquencies and
charge-offs, including the effect of any grace period, re-aging, restructuring,
partial payments considered current or other practices with respect to
delinquency and loss experience.
(d)
For
the purpose of satisfying its reporting obligation under the Exchange Act with
respect to any class of asset-backed securities, the Company shall (or shall
cause each Subservicer and Third-Party Originator to) (i) promptly notify the
Purchaser, any Master Servicer and any Depositor in writing of (A) any
litigation or governmental proceedings pending against the Company, any
Subservicer or any Third-Party Originator that would be material to
securityholders, (B) any affiliations or relationships that develop following
the closing date of a Securitization Transaction between the Company, any
Subservicer or any Third-Party Originator and any of the parties specified
in
clause (D) of paragraph (a) of this Section (and any other parties identified
in
writing by the requesting party) with respect to such Securitization
Transaction, but only to the extent that such affiliations or relationships
do
not include the Purchaser or Depositor, (C) any Event of Default under the
terms
of this Agreement or any Reconstitution Agreement, (D) any merger, consolidation
or sale of substantially all of the assets of the Company, and (E) the Company’s
entry into an agreement with a Subservicer to perform or assist in the
performance of any of the Company’s obligations under this Agreement or any
Reconstitution Agreement and (ii) provide to the Purchaser and any Depositor
a
description of such proceedings, affiliations or relationships.
Each
notification should be sent to the Purchaser by e-mail to
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇. In addition notification pursuant to
this Section 2.03(d), other than those pursuant to Section 2.03(d)(i)(A), should
be sent to:
EMC
Mortgage Corporation
▇▇▇▇
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇-▇▇▇▇
Attention:
Conduit Seller Approval Dept.
Facsimile: (▇▇▇)
▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇
With
a
copy to:
Bear,
▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇,
▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention:
Global Credit Administration
Facsimile: (▇▇▇)
▇▇▇-▇▇▇▇
Notifications
pursuant to Section 2.03(d)(i)(A) should be sent to:
EMC
Mortgage Corporation
Two
Mac
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attention:
Associate General Counsel for Loan Administration
Facsimile: (▇▇▇)
▇▇▇-▇▇▇▇
With
copies to:
Bear,
▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇,
▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention:
Global Credit Administration
Facsimile: (▇▇▇)
▇▇▇-▇▇▇▇
EMC
Mortgage Corporation
▇▇▇▇
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇-▇▇▇▇
Attention:
Conduit Seller Approval Dept.
Facsimile: (▇▇▇)
▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇
(e)
As a
condition to the succession to the Company or any Subservicer as servicer or
subservicer under the Agreement or any Reconstitution Agreement by any Person
(i) into which the Company or such Subservicer may be merged or consolidated,
or
(ii) which may be appointed as a successor to the Company or any Subservicer,
the Company shall provide to the Purchaser, any Master Servicer and any
Depositor, at least 15 calendar days prior to the effective date of such
succession or appointment, (x) written notice to the Purchaser and any Depositor
of such succession or appointment and (y) in writing and in form and substance
reasonably satisfactory to the Purchaser and such Depositor, all information
reasonably requested in writing by the Purchaser or any Depositor in order
to
comply with its reporting obligation under Item
6.02
of
Form 8-K with respect to any class of asset-backed securities.
(f)
In
addition to such information as the Company, as servicer, is obligated to
provide pursuant to other provisions of this Agreement, not later than ten
days
prior to the deadline for the filing of any distribution report on Form 10-D
in
respect of any Securitization Transaction that includes any of the Mortgage
Loans serviced by the Company or any Subservicer, the Company or such
Subservicer, as applicable, shall, to the extent the Company or such Subservicer
has knowledge, provide to the party responsible for filing such report
(including, if applicable, the Master Servicer) notice of the occurrence of
any
of the following events along with all information, data, and materials related
thereto as may be required to be included in the related distribution report
on
Form 10-D (as specified in the provisions of Regulation AB referenced
below):
(i)
any
material modifications, extensions or waivers of pool asset terms, fees,
penalties or payments during the distribution period or that have cumulatively
become material over time (Item 1121(a)(11) of Regulation AB);
(ii)
material breaches of pool asset representations or warranties or transaction
covenants (Item 1121(a)(12) of Regulation AB); and
(iii)
information regarding any pool asset changes (such as, additions, substitutions
or repurchases) and any material changes in origination, underwriting or other
criteria for acquisition or selection of pool assets (Item 1121(a)(14) of
Regulation AB).
(g)
The
Company shall provide to the Purchaser, any Master Servicer and any Depositor,
evidence of the authorization of the person signing any certification or
statement, copies or other evidence of Fidelity Bond Insurance and Errors and
Omission Insurance policy, financial information and reports, and such other
information related to the Company or any Subservicer or the Company or such
Subservicer’s performance hereunder as may be reasonably requested by the
Purchaser, any Master Servicer or any Depositor.
Section
2.04. Servicer Compliance Statement.
The
Company shall use reasonable efforts on or before March 1 of each calendar
year,
but in no event later than March 15 of each calendar year, commencing in 2007,
to deliver to the Purchaser, any Master Servicer and any Depositor a statement
of compliance addressed to the Purchaser, such Master Servicer and such
Depositor and signed by an authorized officer of the Company, to the effect
that
(i) a review of the Company’s activities during the immediately preceding
calendar year (or applicable portion thereof) and of its performance under
the
Agreement and any applicable Reconstitution Agreement during such period has
been made under such officer’s supervision, and (ii) to the best of such
officers’ knowledge, based on such review, the Company has fulfilled all of its
obligations under the Agreement and any applicable Reconstitution Agreement
in
all material respects throughout such calendar year (or applicable portion
thereof) or, if there has been a failure to fulfill any such obligation in
any
material respect, specifically identifying each such failure known to such
officer and the nature and the status thereof.
Section
2.05. Report on Assessment of Compliance and Attestation.
(a)
The
Company shall use reasonable efforts on or before March 1 of each calendar
year,
but in no event later than March 15 of each calendar year, commencing in 2007,
to:
(i)
deliver to the Purchaser, any Master Servicer and any Depositor a report
regarding the Company’s assessment of compliance with the Servicing Criteria
during the immediately preceding calendar year, as required under Rules 13a-18
and 15d-18 of the Exchange Act and Item 1122 of Regulation AB. Such
report shall be addressed to the Purchaser, such Master Servicer and such
Depositor and signed by an authorized officer of the Company, and shall address
each of the Servicing Criteria specified on a certification substantially in
the
form of Exhibit B hereto delivered to the Purchaser concurrently with the
execution of this Reg AB Addendum;
(ii)
deliver to the Purchaser, any Master Servicer and any Depositor a report of
a
registered public accounting firm that attests to, and reports on, the
assessment of compliance made by the Company and delivered pursuant to the
preceding paragraph. Such attestation shall be in accordance with Rules
1-02(a)(3) and 2-02(g) of Regulation S-X under the Securities Act and the
Exchange Act;
(iii)
cause each Subservicer, and each Subcontractor determined by the Company
pursuant to Section 2.06(b) to be “participating in the servicing function”
within the meaning of Item 1122 of Regulation AB, to deliver to the Purchaser
and any Depositor an assessment of compliance and accountants’ attestation as
and when provided in paragraphs (a) and (b) of this Section; and
(iv)
deliver and cause each Subservicer and Subcontractor described in clause (iii)
above to deliver to the Purchaser, any Master Servicer, any Depositor and any
other Person that will be responsible for signing the certification (a
“Sarbanes Certification”) required by Rules 13a-14(d) and 15d-14(d) under
the Exchange Act (pursuant to Section 302 of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002)
on
behalf of an asset-backed issuer with respect to a Securitization Transaction
a
certification signed by an appropriate officer of the Company in the form
attached hereto as Exhibit A.
The
Company acknowledges that the parties identified in clause (a)(iv) above may
rely on the certification provided by the Company pursuant to such clause in
signing a Sarbanes Certification and filing such with the
Commission.
(b)
Each
assessment of compliance provided by a Subservicer pursuant to Section
2.05(a)(iii) shall address each of the Servicing Criteria specified on a
certification substantially in the form of Exhibit B hereto delivered to the
Purchaser concurrently with the execution of this Reg AB Addendum or, in the
case of a Subservicer subsequently appointed as such, on or prior to the date
of
such appointment. An assessment of compliance provided by a
Subcontractor pursuant to Section 2.05(a)(iii) need not address any elements
of
the Servicing Criteria other than those specified by the Company pursuant to
Section 2.06.
Section
2.06. Use of Subservicers and Subcontractors.
The
Company shall not hire or otherwise utilize the services of any Subservicer
to
fulfill any of the obligations of the Company as servicer under the Agreement
or
any Reconstitution Agreement unless the Company complies with the provisions
of
paragraph (a) of this Section. The Company shall not hire or otherwise utilize
the services of any Subcontractor, and shall not authorize any Subservicer
to
hire or otherwise utilize the services of any Subcontractor, to fulfill any
of
the obligations of the Company as servicer under the Agreement or any
Reconstitution Agreement unless the Company complies with the provisions of
paragraph (b) of this Section.
(a)
It
shall not be necessary for the Company to seek the consent of the Purchaser,
any
Master Servicer or any Depositor to the utilization of any
Subservicer. The Company shall cause any Subservicer used by the
Company (or by any Subservicer) for the benefit of the Purchaser and any
Depositor to comply with the provisions of this Section and with Sections 2.02,
2.03(c), (e), (f) and (g), 2.04, 2.05 and 2.07 of this Reg AB Addendum to the
same extent as if such Subservicer were the Company, and to provide the
information required with respect to such Subservicer under Section 2.03( d)
of
this Reg AB Addendum. The Company shall be responsible for obtaining
from each Subservicer and delivering to the Purchaser and any Depositor any
servicer compliance statement required to be delivered by such Subservicer
under
Section 2.04, any assessment of compliance and attestation required to be
delivered by such Subservicer under Section 2.05 and any certification required
to be delivered to the Person that will be responsible for signing the Sarbanes
Certification under Section 2.05 as and when required to be
delivered.
(b)
It
shall not be necessary for the Company to seek the consent of the Purchaser,
any
Master Servicer or any Depositor to the utilization of any
Subcontractor. The Company shall promptly upon written request
provide to the Purchaser, any Master Servicer and any Depositor (or any designee
of the Depositor, such as a master servicer or administrator) a written
description (in form and substance reasonably satisfactory to the Purchaser,
such Master Servicer and such Depositor) of the role and function of each
Subcontractor utilized by the Company or any Subservicer, specifying (i) the
identity of each such Subcontractor that is “participating in the servicing
function” within the meaning of Item 1122 of Regulation AB as determined by the
Company and (ii) which elements of the Servicing Criteria will be addressed
in
assessments of compliance provided by each Subcontractor identified pursuant
to
clause (i) of this paragraph.
As
a
condition to the utilization of any Subcontractor determined to be
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, the Company shall cause any such Subcontractor used by the
Company (or by any Subservicer) for the benefit of the Purchaser and any
Depositor to comply with the provisions of Sections 2.05 and 2.07 of this Reg
AB
Addendum to the same extent as if such Subcontractor were the
Company. The Company shall be responsible for obtaining from each
Subcontractor and delivering to the Purchaser and any Depositor any assessment
of compliance, attestation and other certifications required to be delivered
by
such Subcontractor under Section 2.05, in each case as and when required to
be
delivered.
Section
2.07. Indemnification; Remedies.
(a)
The
Company shall indemnify the Purchaser, each affiliate of the Purchaser, and
each
of the following parties participating in a Securitization Transaction: each
Sponsor; each Person responsible for the preparation, execution or filing of
any
report required to be filed with the Commission with respect to such
Securitization Transaction, or for execution of a certification pursuant to
Rule
13a-14(d) or Rule 15d-14(d) under the Exchange Act with respect to such
Securitization Transaction; each broker dealer acting as underwriter, placement
agent or initial purchaser, each Person who controls any of such parties or
the
Depositor (within the meaning of Section 15 of the Securities Act and Section
20
of the Exchange Act); and the respective present and former directors, officers,
employees and agents (each, an “Indemnified Party”) of each of the foregoing and
of the Depositor, and shall hold each of them harmless from and against any
losses, damages, penalties, fines, forfeitures, legal fees and expenses and
related costs, judgments, and any other costs, fees and expenses that any of
them may sustain arising out of or based upon:
(i)
(A)
any untrue statement of a material fact contained or alleged to be contained
in
any information, report, certification, accountants’ letter or other material in
written or electronic form provided under this Article II by or on behalf of
the
Company, or provided under this Article II by or on behalf of any Subservicer,
Subcontractor or Third-Party Originator (collectively, the “Company
Information”), or (B) the omission or alleged omission to state in the
Company Information a material fact required to be stated in the Company
Information or necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading; provided,
by
way of clarification, that clause (B) of this paragraph shall be construed
solely by reference to the Company Information and not to any other information
communicated in connection with a sale or purchase of securities, without regard
to whether the Company Information or any portion thereof is presented together
with or separately from such other information;
(ii)
any
breach by the Company of its obligations under this Article II, or any failure
by the Company, any Subservicer, any Subcontractor or any Third-Party Originator
to deliver any information, report, certification, accountants’ letter or other
material when and as required under this Article II, including any failure
by
the Company to identify pursuant to Section 2.06(b) any Subcontractor
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB; or
(iii)
any
breach by the Company of a representation or warranty set forth in Section
2.02(a) or in a writing furnished pursuant to Section 2.02(b) and made as of a
date prior to the closing date of the related Securitization Transaction, to
the
extent that such breach is not cured by such closing date, or any breach by
the
Company of a representation or warranty in a writing furnished pursuant to
Section 2.02(b) to the extent made as of a date subsequent to such closing
date;
or
(iv)
the
negligence, bad faith or willful misconduct of the Company in connection with
its performance under this Article II.
If
the
indemnification provided for herein is unavailable or insufficient to hold
harmless an Indemnified Party, then the Company agrees that it shall contribute
to the amount paid or payable by such Indemnified Party as a result of any
claims, losses, damages or liabilities incurred by such Indemnified Party in
such proportion as is appropriate to reflect the relative fault of such
Indemnified Party on the one hand and the Company on the other.
In
the
case of any failure of performance described in clause (a)(ii) of this Section,
the Company shall promptly reimburse the Purchaser, any Depositor, as
applicable, and each Person responsible for the preparation, execution or filing
of any report required to be filed with the Commission with respect to such
Securitization Transaction, or for execution of a certification pursuant to
Rule
13a-14(d) or Rule 15d-14(d) under the Exchange Act with respect to such
Securitization Transaction, for all costs reasonably incurred by each such
party
in order to obtain the information, report, certification, accountants’ letter
or other material not delivered as required by the Company, any Subservicer,
any
Subcontractor or any Third-Party Originator.
This
indemnification shall survive the termination of this Agreement or the
termination of any party to this Agreement.
(b)
(i)
Any failure by the Company, any Subservicer, any Subcontractor or any
Third-Party Originator to deliver any information, report, certification,
accountants’ letter or other material when and as required under this Article
II, or any breach by the Company of a representation or warranty set forth
in
Section 2.02(a) or in a writing furnished pursuant to Section 2.02(b) and made
as of a date prior to the closing date of the related Securitization
Transaction, to the extent that such breach is not cured by such closing date,
or any breach by the Company of a representation or warranty in a writing
furnished pursuant to Section 2.02(b) to the extent made as of a date subsequent
to such closing date, shall, except as provided in clause (ii) of this
paragraph, immediately and automatically, without notice or grace period,
constitute an Event of Default with respect to the Company under the Agreement
and any applicable Reconstitution Agreement, and shall entitle the Purchaser,
any Master Servicer or any Depositor, as applicable, in its sole discretion
to
terminate the rights and obligations of the Company as servicer under the
Agreement and/or any applicable Reconstitution Agreement without payment
(notwithstanding anything in this Agreement or any applicable Reconstitution
Agreement to the contrary) of any compensation to the Company; provided
that to the extent that any provision of the Agreement and/or any
applicable Reconstitution Agreement expressly provides for the survival of
certain rights or obligations following termination of the Company as servicer,
such provision shall be given effect.
(ii)
Any
failure by the Company, any Subservicer or any Subcontractor to deliver any
information, report, certification or accountants’ letter when and as required
under Section 2.04 or 2.05, including any failure by the Company to identify
pursuant to Section 2.06(b) any Subcontractor “participating in the servicing
function” within the meaning of Item 1122 of Regulation AB, which continues
unremedied for ten calendar days after the date on which such information,
report, certification or accountants’ letter was required to be delivered shall
constitute an Event of Default with respect to the Company under the Agreement
and any applicable Reconstitution Agreement, and shall entitle the Purchaser
or
Depositor, as applicable, in its sole discretion to terminate the rights and
obligations of the Company as servicer under the Agreement and/or any applicable
Reconstitution Agreement without payment (notwithstanding anything in this
Agreement to the contrary) of any compensation to the Company (and if the
Company is servicing any of the Mortgage Loans in a Securitization Transaction,
appoint a successor servicer reasonably acceptable to any Master Servicer for
such Securitization Transaction); provided
that to the extent that any provision of the Agreement and/or any
applicable Reconstitution Agreement expressly provides for the survival of
certain rights or obligations following termination of the Company as servicer,
such provision shall be given effect.
(iii)
The
Company shall promptly reimburse the Purchaser (or any designee of the
Purchaser, such as a master servicer) and any Depositor, as applicable, for
all
reasonable expenses incurred by the Purchaser (or such designee) or such
Depositor, as such are incurred, in connection with the termination of the
Company as servicer and the transfer of servicing of the Mortgage Loans to
a
successor servicer. The provisions of this paragraph shall not limit
whatever rights the Purchaser or any Depositor may have under other provisions
of the Agreement and/or any applicable Reconstitution Agreement or otherwise,
whether in equity or at law, such as an action for damages, specific performance
or injunctive relief.
Section
2.08. Third-Party Beneficiary.
For
purposes of this Article II and any related provisions thereto, each Master
Servicer shall be considered a third-party beneficiary of this Reg AB Addendum,
entitled to all the rights and benefits hereof as if it were a direct party
to
Article II of this Reg AB Addendum.
IN
WITNESS WHEREOF, the Purchaser and the Company have caused their names to
be
signed
hereto by their respective officers thereunto duly authorized as of the day
and
year first above
written.
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EMC
MORTGAGE CORPORATION, as Purchaser
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By:
________________________________
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Name:
_____________________________
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Title:
______________________________
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WACHOVIA
MORTGAGE CORPORATION, as Company
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By:
________________________________
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Name:
_____________________________
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Title:
______________________________
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[Signature
Page to Regulation AB Compliance Addendum (servicing-retained)]
EXHIBIT
A
FORM
OF
ANNUAL CERTIFICATION
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Re:
The [ ] agreement dated as of [ ],
200[ ] (the “Agreement”), among [IDENTIFY
PARTIES]
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I,
________________________________, the _____________________ of Wachovia Mortgage
Corporation, certify to [the Purchaser], [the Depositor], and the [Master
Servicer] [Securities Administrator] [Trustee], and their officers, with the
knowledge and intent that they will rely upon this certification,
that:
(1)
I
have reviewed the servicer compliance statement of the Company provided in
accordance with Item 1123 of Regulation AB (the “Compliance Statement”),
the report on assessment of the Company’s compliance with the servicing criteria
set forth in Item 1122(d) of Regulation AB and identified as the responsibility
of the Company pursuant to the Agreement (the “Servicing Criteria”),
provided in accordance with Rules 13a-18 and 15d-18 under Securities Exchange
Act of 1934, as amended (the “Exchange Act”) and Item 1122 of Regulation
AB (the “Servicing Assessment”), the registered public accounting firm’s
attestation report provided in accordance with Rules 13a-18 and 15d-18 under
the
Exchange Act and Section 1122(b) of Regulation AB (the “Attestation
Report”), and all servicing reports, officer’s certificates and other
information relating to the servicing of the Mortgage Loans by the Company
during 200[ ] that were delivered by the Company to the [Depositor] [Master
Servicer] [Securities Administrator] [Trustee] pursuant to the Agreement
(collectively, the “Company Servicing Information”);
(2)
Based
on my knowledge, the Company Servicing Information, 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 the light of the circumstances under
which such statements were made, not misleading with respect to the period
of
time covered by the Company Servicing Information;
(3)
Based
on my knowledge, all of the Company Servicing Information required to be
provided by the Company under the Agreement has been provided to the [Depositor]
[Master Servicer] [Securities Administrator] [Trustee];
(4)
I am
responsible for reviewing the activities performed by the Company as servicer
under the Agreement, and based on my knowledge and the compliance review
conducted in preparing the Compliance Statement and except as disclosed in
the
Compliance Statement, the Servicing Assessment or the Attestation Report, the
Company has fulfilled its obligations under the Agreement in all material
respects; and
(5)
The
Compliance Statement required to be delivered by the Company pursuant to the
Agreement, and the Servicing Assessment and Attestation Report required to
be
provided by the Company and by any Subservicer and Subcontractor pursuant to
the
Agreement, have been provided to the [Depositor] [Master
Servicer]. Any material instances of noncompliance described in such
reports have been disclosed to the [Depositor] [Master Servicer]. Any
material instance of noncompliance with the Servicing Criteria has been
disclosed in such reports.
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Date:
______________________________
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By: _______________________________
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Name:
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Title:
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EXHIIT
B
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The
assessment of compliance to be delivered by the Company shall address, at a
minimum, the criteria identified as below as “Applicable Servicing
Criteria”;
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Servicing
Criteria
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Applicable
Servicing Criteria
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Reference
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Criteria
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General
Servicing Considerations
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||
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1122(d)(1)(i)
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Policies
and procedures are instituted to monitor any performance or other
triggers
and events of default in accordance with the transaction
agreements.
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X
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1122(d)(1)(ii)
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If
any material servicing activities are outsourced to third parties,
policies and procedures are instituted to monitor the third party’s
performance and compliance with such servicing activities.
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X
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1122(d)(1)(iii)
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Any
requirements in the transaction agreements to maintain a back-up
servicer
for the mortgage loans are maintained.
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1122(d)(1)(iv)
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A
fidelity bond and errors and omissions policy is in effect on the
party
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.
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X
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Cash
Collection and Administration
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||
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1122(d)(2)(i)
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Payments
on mortgage loans are deposited into the appropriate custodial bank
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.
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X
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1122(d)(2)(ii)
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Disbursements
made via wire transfer on behalf of an obligor or to an investor
are made
only by authorized personnel.
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X
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1122(d)(2)(iii)
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Advances
of funds or guarantees regarding collections, cash flows or distributions,
and any interest or other fees charged for such advances, are made,
reviewed and approved as specified in the transaction
agreements.
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X
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1122(d)(2)(iv)
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The
related accounts for the transaction, such as cash reserve accounts
or
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.
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X
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Reference
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Criteria
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|
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1122(d)(2)(v)
|
Each
custodial account is maintained at a federally insured depository
institution as set forth in the transaction agreements. For
purposes of this criterion, “federally insured depository institution”
with respect to a foreign financial institution means a foreign financial
institution that meets the requirements of Rule 13k-1(b)(1) of
the Securities Exchange Act.
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X
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1122(d)(2)(vi)
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Unissued
checks are safeguarded
so as to prevent unauthorized access.
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X
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1122(d)(2)(vii)
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Reconciliations
are prepared on a monthly basis for all asset-backed securities related
bank accounts, including custodial accounts and related bank clearing
accounts. These reconciliations are (A) mathematically
accurate; (B) prepared within 30 calendar days after the bank statement
cutoff date, or such other number of days specified in the transaction
agreements; (C) 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.
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X
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Investor
Remittances and Reporting
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||
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1122(d)(3)(i)
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Reports
to investors, including those to be filed with the Commission, are
maintained in accordance with the transaction agreements and applicable
Commission requirements. Specifically, such reports (A)
are prepared 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.
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X
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1122(d)(3)(ii)
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Amounts
due to investors are allocated and remitted in accordance with timeframes,
distribution priority and other terms set forth in the transaction
agreements.
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X
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1122(d)(3)(iii)
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Disbursements
made to an investor are posted within two business days to the Servicer’s
investor records, or such other number of days specified in the
transaction agreements.
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X
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1122(d)(3)(iv)
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Amounts
remitted to investors per the investor reports agree with cancelled
checks, or other form of payment, or custodial bank
statements.
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X
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Reference
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Criteria
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|
|
Pool
Asset Administration
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||
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1122(d)(4)(i)
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Collateral
or security on mortgage loans is maintained as required by the transaction
agreements or related mortgage loan documents.
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X
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1122(d)(4)(ii)
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Mortgage
loan and related documents are safeguarded as required by the transaction
agreements
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X
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1122(d)(4)(iii)
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Any
additions, removals or substitutions to the asset pool are made,
reviewed
and approved in accordance with any conditions or requirements in
the
transaction agreements.
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X
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1122(d)(4)(iv)
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Payments
on mortgage loans, including any payoffs, made in accordance with
the
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.
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X
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1122(d)(4)(v)
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The
Servicer’s records regarding the mortgage loans agree with the Servicer’s
records with respect to an obligor’s unpaid principal
balance.
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X
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1122(d)(4)(vi)
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Changes
with respect to the terms or status of an obligor’s mortgage loans (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.
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X
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1122(d)(4)(vii)
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Loss
mitigation or recovery actions (e.g., forbearance plans, modifications
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.
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X
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1122(d)(4)(viii)
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Records
documenting collection efforts are maintained during the period a
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).
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X
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Reference
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Criteria
|
|
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1122(d)(4)(ix)
|
Adjustments
to interest rates or rates of return for mortgage loans with variable
rates are computed based on the related mortgage loan
documents.
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X
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1122(d)(4)(x)
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Regarding
any funds held in trust for an obligor (such as escrow
accounts): (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.
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X
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1122(d)(4)(xi)
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Payments
made on behalf of an obligor (such as tax or insurance payments)
are 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.
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X
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1122(d)(4)(xii)
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Any
late payment penalties in connection with any payment to be made
on behalf
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.
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X
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1122(d)(4)(xiii)
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Disbursements
made on behalf of an obligor are posted within two business days
to the
obligor’s records maintained by the servicer, or such other number of days
specified in the transaction agreements.
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X
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1122(d)(4)(xiv)
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Delinquencies,
charge-offs and uncollectible accounts are recognized and recorded
in
accordance with the transaction agreements.
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X
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1122(d)(4)(xv)
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Any
external enhancement or other support, identified in Item 1114(a)(1)
through (3) or Item 1115 of Regulation AB, is maintained as set forth
in
the transaction agreements.
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