EXHIBIT 10.16.3
AMENDED AND RESTATED COLLATERAL AGENCY AGREEMENT
By and Among:
AHM SPV I, LLC,
As Borrower,
and
AMERICAN HOME MORTGAGE SERVICING, INC.
As the Servicer
and
CALYON NEW YORK BRANCH,
As Administrative Agent,
and
DEUTSCHE BANK NATIONAL TRUST COMPANY,
As Collateral Agent
Dated as of November 22, 2005
TABLE OF CONTENTS
Page
ARTICLE I GENERAL TERMS................................................1
1.1. Certain Definitions..........................................1
ARTICLE II APPOINTMENT OF COLLATERAL AGENT..............................1
2.1. Appointment..................................................1
2.2. Collateral Agency Fees.......................................2
ARTICLE III COLLATERAL PROCEDURES........................................2
3.1. Collateral...................................................2
3.2. Delivery of Collateral to the Collateral Agent...............3
3.3. Power of Attorney............................................5
3.4. Redemption of Mortgage Collateral............................6
3.5. Releases of Mortgage Notes for Servicing.....................9
3.6. [RESERVED]..................................................10
3.7. Wet Borrowings..............................................10
3.8. Collateral Reporting........................................11
3.9. Further Obligations of the Collateral Agent.................11
3.10. Segregation of Collateral...................................12
3.11. Delivery of Required Documents to the
Administrative Agent.....................................12
3.12. Take-Out Commitment Reporting...............................12
ARTICLE IV THE COLLATERAL AGENT........................................12
4.1. Instructions to the Collateral Agent........................12
4.2. Reliance by the Collateral Agent; Responsibility of
the Collateral Agent.....................................13
4.3. Agents and Affiliates.......................................16
4.4. Successor Collateral Agent..................................16
4.5. Right of Inspection.........................................17
4.6. Accounting in Certain Circumstances.........................17
ARTICLE V INDEMNIFICATION.............................................18
5.1. Indemnities by the Servicer.................................18
ARTICLE VI MISCELLANEOUS...............................................18
6.1. Notices.....................................................18
6.2. Amendments, Etc.............................................19
6.3. Invalidity..................................................19
6.4. Survival of Agreements......................................19
6.5. Cumulative Rights...........................................19
6.6. Construction; Governing Law.................................19
6.7. Successors and Assigns......................................19
6.8. The Collateral Agent Representations and Warranties.........20
6.9. Rights of La Fayette Program Agent..........................20
6.10. Counterparts................................................20
6.11. No Proceedings..............................................20
6.12. Electronic Counterparts.....................................20
6.13. Waiver of Jury Trial........................................20
6.14. Consent to Jurisdiction; Waiver of Immunities...............21
6.15. References to Loan Agreement................................21
SCHEDULES AND EXHIBITS
Schedule I Collateral Review Functions - ss.3.2(e)
Schedule II Addresses and Notices - ss.6.1
Schedule III Approved Take-Out Investors
Exhibit D-1 Definitions - ss.1
Exhibit D-2 Security Agreement - ss.3.1(a)
Exhibit D-3 Form of Collection Account Control Agreement - ss.3.1(b)
Exhibit D-4 Form of Assignment - ss.3.1(c) and ss.3.2(a)
Exhibit D-5 Form of Transfer Request
Exhibit D-5A Form of Shipping Request
Exhibit D-6(a) Form of Bailee and Security Agreement Letter for Approved
Take-Out Investors- ss.3.4(b)(i)
Exhibit D-6(b) Form of Bailee and Security Agreement Letter for Pool
Custodian ss.3.4(b)(i)
Exhibit D-7 Form of Trustee Receipt and Security Agreement for Approved
Take-Out Investors - ss.3.5
Exhibit D-8 Form of Collateral Agent Daily Report - ss.3.8(a)
Exhibit D-9 Borrowing Report
Exhibit D-10 UCC Financing Statements - ss.3.1(d)
Exhibit D-11 Collection Account Release Notice - ss. 3.4(a)
Exhibit D-12 Assignment of Trade
Exhibit D-13 Disbursement Account Control Agreement
AMENDED AND RESTATED COLLATERAL AGENCY AGREEMENT
Dated as of November 22, 2005
THIS AMENDED AND RESTATED COLLATERAL AGENCY AGREEMENT (the
"Agreement"), among AHM SPV I, LLC, a Delaware limited liability company (the
"Borrower"), AMERICAN HOME MORTGAGE SERVICING, INC., a Maryland corporation,
CALYON NEW YORK BRANCH ("Calyon"), in its capacity as the administrative agent
for the "Lenders" under and as defined in the Loan Agreement referred to below
(the "Administrative Agent"), and DEUTSCHE BANK NATIONAL TRUST COMPANY, in its
capacity as collateral agent hereunder (the "Collateral Agent").
WHEREAS, the Borrower has entered into an Amended and Restated Loan
Agreement dated as of November 22, 2005 (as the same may be amended, restated,
supplemented or modified from time to time, the "Loan Agreement"), among the
Borrower, the Issuer, Calyon, as the Administrative Agent, the Banks, and
American Home Mortgage Servicing, Inc. (the "Servicer"), in its capacity as
servicer thereunder, pursuant to which the Lenders may make secured Advances to
the Borrower on a revolving basis;
WHEREAS, the parties now desire to enter into this Amended and Restated
Collateral Agency Agreement (the "Agreement") to provide for the holding and
monitoring of Collateral to be furnished pursuant to the Loan Agreement;
NOW, THEREFORE, the parties agree as follows:
ARTICLE I
GENERAL TERMS
1.1. Certain Definitions.
Unless otherwise defined herein or in the Loan Agreement, terms are
used herein as defined in Exhibit D-1 hereto.
ARTICLE II
APPOINTMENT OF COLLATERAL AGENT
2.1. Appointment.
(a) The Administrative Agent, on behalf of the holders of
the Obligations, hereby appoints Deutsche Bank National Trust Company, as
"Collateral Agent" under this Agreement and authorizes the Collateral Agent to
take such action on the Administrative Agent's behalf and to exercise such
powers and perform such duties as are hereby expressly delegated to the
Collateral Agent by the terms of this Agreement, together with such powers as
are reasonably incidental thereto.
(b) The Collateral Agent hereby accepts such appointment
and agrees to hold, maintain, and administer for the exclusive benefit of the
holders of the Obligations all Collateral at any time delivered to it by or on
behalf of the Borrower as herein provided. The Collateral Agent acknowledges and
agrees that it is acting and will act with respect to the Collateral for the
exclusive benefit of the holders of the Obligations and shall not be subject
with respect to the Collateral in any manner or to any extent to the direction
or control of the Borrower except as expressly permitted hereunder. The
Collateral Agent (or its designee) for the benefit of the Administrative Agent
and the holders of the Obligations, agrees to act in accordance with this
Agreement and in accordance with any written instructions of the Administrative
Agent as provided in this Agreement. Under no circumstances shall the Collateral
Agent deliver possession of Collateral to the Borrower except in accordance with
the express terms of this Agreement or otherwise upon the written instruction of
the Administrative Agent as provided in this Agreement. Upon a written request
by the Servicer (who shall not request substitution of Eligible Mortgage Loans
if, as reflected in the most recent Borrowing Report, total Collateral Value of
Eligible Mortgage Collateral, immediately after giving effect to a requested
transfer and any accompanying substitution of Mortgage Loan Collateral, is less
than total Principal Debt) and approval by the Borrower, Collateral Agent is
authorized to permit substitution of Eligible Mortgage Loans (as certified by
the Servicer to be Eligible Mortgage Loans) unless the Collateral Agent shall
have received written notice from the Administrative Agent that a Default or
Event of Default has occurred.
2.2. Collateral Agency Fees.
The Servicer agrees to pay such fees and expenses of the Collateral
Agent as shall be agreed to in writing between the Collateral Agent and
Servicer. The obligation of the Servicer to pay the Collateral Agent's fees and
expenses for its services under this Agreement shall survive the termination of
this Agreement and the earlier resignation or removal of the Collateral Agent.
ARTICLE III
COLLATERAL PROCEDURES
3.1. Collateral.
The Borrower has executed and delivered to the Administrative Agent:
(a) a Security Agreement in favor of the Administrative
Agent for the benefit of the holders of the Obligations in substantially the
form of Exhibit D-2 hereto;
(b) a Collection Account Control Agreement in favor of
the Administrative Agent for the benefit of the holders of the Obligations
substantially in the form of Exhibit D-3 hereto; and
(c) the Assignments provided for in Section 3.2 hereof in
the form of Exhibit D-4 hereto.
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3.2. Delivery of Collateral to the Collateral Agent.
(a) Periodically, the Borrower may deliver Mortgage Loan
Collateral to the Collateral Agent to hold as bailee for the Administrative
Agent. The Borrower may deliver from time to time such other documents as shall
be specified in a notice by the Administrative Agent to the Collateral Agent as
documents that are required to be delivered to the Collateral Agent pursuant to
this Agreement in order to meet requirements of the Loan Agreements or
agreements required by the Loan Agreement. Each delivery shall be made in
association with an assignment of a security interest (the "Assignment") to the
Administrative Agent, for the benefit of the holders of the Obligations, in all
Mortgage Loans, Take-Out Commitments, ▇▇▇▇▇▇ and related Collateral delivered
with or described in such Assignment or any schedules thereto. The Borrower
shall use substantially the form illustrated in Exhibit D-4 hereto for each
Assignment, or such other form as may be acceptable to, or required by, the
Administrative Agent, from time to time.
(b) Each Assignment delivered to the Collateral Agent
shall be accompanied by a completed Schedule II and Schedule III, using the
forms of such schedules as prescribed in Exhibit D-4 hereto, together with a
current Borrowing Report, and with respect to each Mortgage Loan described in
Schedule II to each Assignment the following items (collectively, the "Principal
Mortgage Documents"):
(i) the original of each Mortgage Note, endorsed by
the Servicer in blank (without recourse) and all intervening
endorsements thereto;
(ii) an original executed assignment in blank for
each Mortgage securing such Mortgage Loan, in recordable form,
executed by the Originator, in the case of each Mortgage Loan
that is not a MERS Designated Mortgage Loan; and
(iii) a certified copy of the executed Mortgage
related to such Mortgage Note, certified by the Servicer,
escrow agent, title company, closing attorney or an Affiliate
of the Servicer as a true and correct copy.
(c) The Servicer shall hold in trust for the
Administrative Agent for the benefit of the holders of the Obligations, with
respect to each Mortgage Loan included in the Collateral (the following being
referred to, collectively, as the "Other Mortgage Documents"):
(i) the original filed Mortgage relating to such
Mortgage Loan; provided, however, that until an original
Mortgage is received from the public official charged with its
filing and recordation, a copy, certified by the closing agent
to be a true and correct copy of the filed and recorded
original, may be used by the Borrower to satisfy this
requirement;
(ii) other than with respect to a HUD Repossessed
Property that is sold to a consumer, a mortgagee's policy of
title insurance (or binding unexpired commitment to issue such
insurance if the policy has not yet been delivered to the
Servicer) insuring that the original mortgagee and its
successors and assigns have a perfected, first-priority Lien
created by the Mortgage securing such Mortgage
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Loan (subject to title exceptions that conform to the related
Take-Out Commitment) in a policy amount not less than the
principal amount of such Mortgage Loan;
(iii) the original hazard insurance policy,
appropriately indicating that all insurance proceeds will be
paid to the original mortgagee and its successors and assigns,
referred to in Section 6.6(b) of the Loan Agreement which
relate to such Mortgage Loan, or other evidence of insurance
acceptable to the Administrative Agent;
(iv) the form of current appraisal of the Property
described in the Mortgage, prepared by a state licensed
appraiser, that complies with all applicable Governmental
Requirements, provided, however, that no appraisal shall be
required for Mortgage Loans (x) financing HUD repossessed
Property that is sold to a consumer, financed with an FHA
loan, fully insurable and in accordance with FHA guidelines,
but for which an appraisal is not required, or (y)
representing so called VA Rate Reduction or FHA streamline
refinances, insurable in accordance with VA and FHA
guidelines, but for which an appraisal is not required; and
(v) all other original documents.
Upon three Business Days' prior written notice by the Administrative Agent to
the Collateral Agent, the Collateral Agent will receive from the Servicer all
such items, held in trust. The Collateral Agent shall hold such items as bailee
for the Administrative Agent or such other party as may be designated in such
notice.
(d) The Servicer shall provide the Collateral Agent and
the Administrative Agent with full access to all Other Mortgage Documents held
in trust for the Administrative Agent at all times.
(e) With respect to each Assignment, together with the
related electronic transmission, that is received by the Collateral Agent by
11:30 a.m. (eastern time) on a Business Day, the Collateral Agent shall include
the Mortgage Loans identified thereon on the Collateral Agent Daily Report to be
delivered electronically on the following Business Day, even if the Collateral
Agent has not completed its review of the related Principal Mortgage Documents.
The Collateral Agent shall prepare by 10:30 a.m. (eastern time) on such
following Business Day, the Collateral Agent Daily Report provided for in
Section 3.8 hereof, and furnish it electronically to the Administrative Agent,
the Managing Agents and the Borrower. The Collateral Agent shall review the
Principal Mortgage Documents for up to 500 Mortgage Loans delivered with any
such Assignment no later than the opening of business of the Collateral Agent on
the Business Day following delivery of such Collateral Agent Daily Report. The
Collateral Agent shall have one (1) additional Business Day to review each
additional set of 500 Mortgage Loans in excess of the initial set of 500
Mortgage Loans; provided, that, if the Collateral Agent does not complete its
review of any such Principal Mortgage Documents within one (1) Business Day
after receiving such Principal Mortgage Documents and including the related
Mortgage Loan on a Collateral Agent Daily Report, the Collateral Agent shall
report the Collateral Value for any and all such Mortgage Loans as zero on the
Collateral Agent Daily Report for the next Business Day.
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The Collateral Agent's responsibility to review such Collateral is limited to
the review steps described on Schedule I hereto.
(f) The Collateral Agent shall, acting on behalf of the
Administrative Agent for the benefit of the holders of the Obligations, and as
agent and bailee of, and as custodian for, the Administrative Agent for the
benefit of the holders of the Obligations, retain possession and custody of the
documents delivered to the Collateral Agent pursuant hereto, which documents
shall, subject to Section 4.2(k) and 4.4, remain in the state of California for
all purposes (including but not limited to the perfection of the security
interest of the Administrative Agent, for the benefit of the holders of the
Obligations, in such Collateral) until the Collateral is to be released pursuant
to Section 3.4 hereof.
(g) Notwithstanding the foregoing provisions of Section
3.2, the Servicer on behalf of Borrower may ship Other Mortgage Documents to
Approved Take-Out Investors under bailment for review by the Approved Take-Out
Investor prior to purchase of a Mortgage Note under a Take-Out Commitment.
(h) The Servicer shall deliver to the Collateral Agent
within the first five (5) Business Day of each calendar month a report (the
"Monthly Payment Status Report"), on a form mutually acceptable to the Servicer
and the Collateral Agent, describing the delinquency status of each Mortgage
Loan as of the last day of the preceding calendar month.
3.3. Power of Attorney.
(a) Subject to subsection (b) below, the Borrower hereby
irrevocably appoints the Administrative Agent, for the benefit of the holders of
the Obligations, its attorney in fact, with full power of substitution, for and
on behalf and in the name of the Borrower, to: (i) endorse and deliver to any
Person any check, instrument or other paper coming into the Collateral Agent's,
the Administrative Agent's or any Lender's possession and representing payment
made in respect of any Mortgage Note or Take-Out Commitment Document delivered
hereunder or in respect of any other Collateral; (ii) prepare, complete,
execute, deliver and record any Assignment to be delivered to the Collateral
Agent, the Administrative Agent or to any other Person of any Mortgage relating
to any Mortgage Note delivered hereunder as Mortgage Loan Collateral; (iii)
endorse and deliver any Mortgage Note as Mortgage Loan Collateral arising as
proceeds thereof, and do every other thing necessary or desirable to effect
transfer of all or any part of the Mortgage Loan Collateral to the
Administrative Agent, for the benefit of the holders of the Obligations, or to
any other Person; (iv) take all necessary and appropriate action with respect to
all Obligations and the Mortgage Loan Collateral to be delivered to the
Collateral Agent or the Administrative Agent or held by the Borrower in trust
for the Administrative Agent for the benefit of the holders of the Obligations;
(v) commence, prosecute, settle, discontinue, defend, or otherwise dispose of
any claim relating to any Take-Out Commitment or any other part of the Mortgage
Loan Collateral; and (vi) sign the Borrower's name wherever appropriate to
effect the performance of this Agreement.
(b) This Section 3.3 shall be liberally, not
restrictively, construed so as to give the greatest latitude to the
Administrative Agent's powers, as the Borrower's attorney-in-fact, to collect,
sell, and deliver any of the Mortgage Loan Collateral and all other documents
relating
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thereto. The powers and authorities herein conferred on the Administrative Agent
may be exercised by the Administrative Agent through any Person who, at the time
of the execution of a particular instrument, is an authorized officer or agent
of the Administrative Agent. The power of attorney conferred by this Section 3.3
shall become effective upon the occurrence, and remain effective during the
continuance, of a Default or an Event of Default and is granted for a valuable
consideration and is coupled with an interest and irrevocable so long as the
Obligations, or any part thereof, shall remain unpaid or any Bank Commitment is
outstanding. All Persons dealing with the Administrative Agent, any officer
thereof, or any substitute attorney, acting pursuant hereto shall be fully
protected in treating the powers and authorities conferred by this Section 3.3
as existing and continuing in full force and effect until advised by the
Administrative Agent that the Obligations have been fully and finally paid and
satisfied and all Bank Commitments have been terminated.
3.4. Redemption of Mortgage Collateral.
(a) Generally. So long as no Default or Event of Default
is continuing, the Servicer (on behalf of the Borrower) may obtain releases of
the Administrative Agent's security interest in all or any part of the
Collateral (including releases from the Collection Account) at any time, and
from time to time, (i) to the extent that total Collateral Value of all Eligible
Mortgage Collateral (immediately after giving effect to the requested release)
equals or exceeds the Principal Debt, as shown on the most recent Borrowing
Report, or (ii) that either (A) the Borrower has made a principal payment on
account of the Principal Debt in an amount, or (B) the Borrower has delivered to
the Collateral Agent (and the Collateral Agent has received) as bailee for the
Administrative Agent substitute Eligible Mortgage Collateral with a Collateral
Value, such that after giving effect to such payment or delivery, the total
Collateral Value of all Eligible Mortgage Collateral will equal or exceed the
Principal Debt. Each request for a partial release of Collateral from the
Collection Account shall be addressed to the Collateral Agent and the
Administrative Agent and shall be substantially in the form of Exhibit D-11
attached hereto (a "Collection Account Release Notice"). So long as no Default
or Event of Default is continuing, the Servicer (on behalf of the Borrower) may
by written direction to the Collateral Agent effect a transfer of funds from the
Collection Account to the Disbursement Account; provided, that the Servicer
shall not request and the Collateral Agent shall not permit funds to be released
from the Disbursement Account unless the total Collateral Value of all Eligible
Mortgage Collateral (immediately after giving effect to the requested release)
equals or exceeds the Principal Debt, as shown on the most recent Borrowing
Report. Each request for a partial release of Collateral (excluding releases
from either the Collection Account or the Disbursement Account) shall be
addressed to the Collateral Agent and shall be substantially in the form
illustrated in Exhibit D-5 attached hereto (the "Transfer Request").
(b) Redemption Pursuant to Sale. So long as no Default or
Event of Default is continuing (and, if a Default or Event of Default is
continuing, at the Administrative Agent's direction), any one of the following
may occur: (x) the Borrower, or the Servicer acting for the Borrower, from time
to time may sell or pool Mortgage Loans either to an Approved pursuant to a
Take-Out Commitment or Hedge or to one of the Originators under the Repurchase
Agreement; (y) the Borrower may provide Mortgage Loans to one of the Originators
for sale to an Approved Take-Out Investor pursuant to a Take-Out Commitment or
Hedge, provided that payment is directed to the Collection Account and the
security interest in the Mortgage Loan will
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not be released and the Borrower will not be deemed to have sold the Mortgage
Loans to any of the Originators until the Purchase Price is received in the
Collection Account; and (z) the Borrower, or the Servicer acting for the
Borrower, may request the Administrative Agent to permit the Borrower to sell
Mortgage Loans, or to pool Mortgage Loans, under such other circumstances as may
be described in the request. Upon the receipt by the Collateral Agent of a
Shipping Request preliminary to a transaction permitted by this Section 3.4,
identifying Collateral to be delivered to an Approved Take-Out Investor or
through any of the Originators, and so long as (x) no Default or Event of
Default of which a Responsible Officer of the Collateral Agent shall have
received written notice shall be in existence or (y) if a Default or Event of
Default has occurred, the Administrative Agent has approved the Shipping
Request:
(i) The Collateral Agent shall deliver to the
Approved, or its loan servicing provider or custodian, under
the Collateral Agent's "Bailee and Security Agreement Letter,"
substantially in the form of Exhibit D-6(a), or D-6(b) hereto
or such other form as may be approved by the Administrative
Agent as appropriate, the items of Mortgage Loan Collateral
being sold which are held by the Collateral Agent as bailee
for the Administrative Agent pursuant to Section 3.2 hereof,
with the release of the security interest in favor of the
Administrative Agent for the benefit of the holders of the
Obligations in such items being conditioned upon timely
payment to the Collection Account of the amount described in
Section 3.4(b)(iii);
(ii) The Servicer shall, as agent for the
Administrative Agent, deliver to such Approved Take-Out
Investor , or such Approved Take-Out Investor's loan servicing
provider or custodian, under a letter agreement or other
arrangement approved by the Administrative Agent the items
held by the Servicer pursuant to Section 3.2(c) that are
related to the Mortgage Loan Collateral to be transferred on
the condition that such Approved Take-Out Investor or its loan
servicing provider or custodian shall hold or control such
Other Mortgage Documents as bailee for the Administrative
Agent for the benefit of the holders of the Obligations until
the Approved Take-Out Investor has paid the full purchase
price for such Mortgage Loan Collateral to the Collection
Account pursuant to the terms of the related Take-Out
Commitment or Hedge;
(iii) Within forty-five (45) days after the delivery
by the Collateral Agent to such Approved Take-Out Investor or
its loan servicing provider or custodian of the items of
Mortgage Loan Collateral described in Section 3.4(b) or (ii),
the Borrower shall make a payment, or shall cause a payment to
be made, to the Collection Account, for distribution to the
Administrative Agent for the account of the Lenders in an
amount at least equal to the full purchase price for such
Mortgage Loan Collateral or shall substitute Eligible Mortgage
Collateral as permitted by this Section 3.4 it being
understood that the Collateral Agent shall have no
responsibility to verify the purchase price; and
(iv) With respect to each Shipping Request that is
received by the Collateral Agent by 11:30 a.m. (eastern time)
on a Business Day, the Collateral Agent shall use due
diligence and best efforts to review such Shipping Request
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and prepare the Mortgage Loan files identified in each
Shipping Request, for shipment prior to the close of business
on the day the Shipping Request is received by the Collateral
Agent, and, in any event shall review such Shipping Request
and prepare the Mortgage Loan files identified in such
Shipping Request no later than 24 hours after such Shipping
Request is received by the Collateral Agent.
(c) Transfers. So long as no Default or Event of Default
is continuing of which a Responsible Officer of the Collateral Agent has
received written notice, subject to Section 3.4(a) and (b), the Borrower or
Servicer on behalf of the Borrower shall, at any time, be permitted to cause the
Collateral Agent to reflect the transfer of Mortgage Loans to any Permitted
Transferees (as defined below) by means of its daily electronic transmissions to
the Collateral Agent, together with delivery of a Transfer Request delivered to
the Collateral Agent, on or before 11:30 a.m. (eastern time), identifying each
Mortgage Loan being transferred. The Collateral Agent's sole responsibility with
respect to any such transfers shall be to correctly reflect such transfers on
its computer system and books and records and to indicate, on its Collateral
Agent's Daily Report to be delivered on such Business Day, that such transfers
have been effected. "Permitted Transferees" means any of the Originators, in
connection with any sale and transfer thereto effected pursuant to the terms of
the Repurchase Agreement and any Approved Take-Out Investor. However, requested
transfers will not be made if (A) as reflected in the most recent Borrowing
Report, total Principal Debt will equal or exceed the total Collateral Value of
Eligible Mortgage Collateral immediately after giving effect to a requested
transfer and any accompanying substitution of Mortgage Collateral, or (B) the
Collateral Agent shall have received written notice from the Administrative
Agent that a Default or Event of Default has occurred.
(d) Continuation of Lien. Unless released in writing by
the Administrative Agent as herein provided, the security interest in favor of
the Administrative Agent for the benefit of the holders of the Obligations, in
all Mortgage Loan Collateral transmitted pursuant to Section 3.4(b) shall
continue in effect until such time as the Administrative Agent shall have
received payment in full of the amount described in Section 3.4(b)(iii).
(e) Application of Proceeds; No Duty. Neither the
Administrative Agent, nor the Collateral Agent, nor any Lender shall be under
any duty at any time to credit the Borrower for any amounts due from any
Approved Take-Out Investor in respect of any purchase of any Mortgage Collateral
contemplated under Section 3.4(b) above, until the Administrative Agent has
actually received such amount in the form of immediately available funds, for
deposit to the Collection Account. Neither the Administrative Agent, nor the
Collateral Agent, nor any Lender shall be under any duty at any time to collect
any amounts or otherwise enforce any obligations due from any Approved Take-Out
Investor in respect of any such purchase.
(f) Mandatory Redemption of Mortgage Collateral.
Notwithstanding any provision hereof to the contrary, if at any time a
Collateral Deficiency exists, the Borrower shall, immediately upon receipt of
notice (which may be by telephone, promptly confirmed in writing) from the
Administrative Agent or the Collateral Agent, make a deposit to the Collection
Account or pledge, assign and deliver additional or substitute Eligible Mortgage
Collateral to the Administrative Agent for the benefit of the holders of the
Obligations, so that, immediately after
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giving effect to such payment or pledge and assignment, the total Collateral
Value of Eligible Mortgage Collateral shall be equal to or greater than the
Principal Debt.
(g) Representation in Connection with Releases, Sales and
Transfers. The Borrower and the Servicer each represents and warrants that each
request for any release or transfer pursuant to Section 3.4(a), Section 3.4(b)
or Section 3.4(c) shall automatically constitute a representation and warranty
to the Lenders, the Administrative Agent, and the Collateral Agent to the effect
that immediately before and after giving effect to such release or Transfer
Request, the Collateral Value of Eligible Mortgage Collateral shall equal or
exceed the Principal Debt. In connection with any request for a release or a
Transfer Request, the Collateral Agent may assume, in the absence of written
notice to the contrary received from the Administrative Agent, that immediately
before and after giving effect to such release of Collateral or Transfer
Request, no Default or Event of Default exists.
(h) Limitation on Releases. Notwithstanding any provision
to the contrary, the Collateral Agent shall not release any Collateral unless
(i) payment of what purports to be the purchase price by the Approved Take-Out
Investor has been made in immediately available funds to the Collection Account;
or (ii) immediately before and after giving effect thereto, the total Collateral
Value of Eligible Mortgage Collateral (including any Eligible Mortgage Loans
substituted for those Eligible Mortgage Loans being released) shall equal or
exceed aggregate Principal Debt, as reflected in the most recent Borrowing
Report.
3.5. Releases of Mortgage Notes for Servicing.
The Servicer may from time to time request, in writing in the form of
Exhibit D-7 hereto, that the Collateral Agent deliver a Mortgage Note that
constitutes Mortgage Loan Collateral so that (a) such Mortgage Note may be
replaced by a corrected Mortgage Note, or (b) any servicing action may take
place with respect to such Mortgage Note. Upon receipt by the Collateral Agent
of such a request from the Servicer, and so long as the Collateral Agent has not
received written notice that a Default or Event of Default shall be in
existence, the Collateral Agent shall deliver to the Servicer, under the "Trust
Receipt and Security Agreement Letter," substantially in the form of Exhibit
D-7, hereto, or such other form as may be approved by the Administrative Agent,
the Mortgage Note to be corrected or serviced, such delivery to be conditioned
upon the receipt by the Collateral Agent within fourteen (14) calendar days of
either a corrected Mortgage Note, in the case of Mortgage Notes delivered for
correction, or the Mortgage Note originally delivered to the Servicer by the
Collateral Agent, in the case of a Mortgage Note delivered for a servicing
action; provided, that (as certified to the Collateral Agent by the Servicer):
(i) at no time shall Mortgage Notes having an
aggregate Collateral Value in excess of $2.5% of the Maximum
Facility Amount be so delivered to the Servicer pursuant to
this Section 3.5 (the Collateral Value assigned to each such
Mortgage Notes delivered for correction shall be determined
utilizing as the principal amount of such Mortgage Note the
lesser of the uncorrected face value of such Mortgage Note and
the correct face value of such Mortgage Note known to the
Borrower or the Servicer; provided, however, that if the
correct face value of such Mortgage Note is not known to the
Collateral Agent, the Collateral Agent
9
may use the uncorrected face value of such Mortgage Note in
determining the Collateral Value);
(ii) with respect to Mortgage Notes delivered for
correction, until such time as a corrected Mortgage Note shall
have been delivered to the Collateral Agent, the Collateral
Value attributed to each Mortgage Note delivered to the
Servicer to be corrected in accordance with this Section 3.5
shall be the lesser of the uncorrected face value of such
Mortgage Note and the corrected face value of such Mortgage
Note known to the Borrower and communicated in writing by the
Borrower to the Collateral Agent; provided, however, that if
the correct face value of such Mortgage Note is not known to
the Collateral Agent, the Collateral Agent may use the
uncorrected face value of such Mortgage Note in determining
the Collateral Value; and
(iii) notwithstanding the preceding clause (ii),
unless, (A) in the case of Mortgage Notes delivered for
correction, the corrected Mortgage Note is endorsed in blank
(without recourse) and re-delivered to the Collateral Agent
within 14 calendar days of the date of delivery by the
Collateral Agent of the Mortgage Note to be corrected, or (B)
in the case of Mortgage Notes delivered for servicing actions,
the original Mortgage Note is re-delivered to the Collateral
Agent within 14 calendar days of the date of delivery by the
Collateral Agent of the Mortgage Note to be serviced, the
Collateral Value attributed to either the Mortgage Note to be
delivered and the corrected Mortgage Note, or the Mortgage
Note delivered for servicing, shall be zero beginning on the
15th calendar day; provided, however, that the Collateral
Value attributable to the corrected Mortgage Note or the
Mortgage Note delivered for correction or servicing will be
reinstated promptly upon the subsequent delivery thereof to
the Collateral Agent.
3.6. [RESERVED].
3.7. Wet Borrowings.
(a) Pursuant to the Loan Agreement, the Borrower may from
time to time request that certain Borrowings be funded after delivery to the
Collateral Agent of the related Assignment, but prior to the delivery to the
Collateral Agent of the corresponding Principal Mortgage Documents (individually
a "Wet Borrowing"; collectively "Wet Borrowings"). The Borrower and the
Administrative Agent acknowledge that Advances in respect of Wet Borrowings are
subject to various terms and conditions of the Loan Agreement, including those
set forth in Section 2.3(c) to the Loan Agreement.
(b) Delivery of Principal Mortgage Documents. Within nine
(9) Business Days after the date that each Assignment is delivered (and
inclusion of the related Wet Loans within the computation of Collateral Value as
reported on the Collateral Agent Daily Report) to the Collateral Agent, the
Borrower shall deliver to the Collateral Agent all of the Principal Mortgage
Documents pertaining to such Wet Loans, or make a mandatory prepayment so that
after giving effect thereto, the Collateral Value of Eligible Mortgage
Collateral (excluding such Wet Loans) shall equal or exceed the Principal Debt.
10
3.8. Collateral Reporting.
(a) At the commencement of each Business Day, and in no
event later than 10:30 a.m. (eastern time), the Collateral Agent shall furnish
to the Borrower, Servicer, each Managing Agent and the Administrative Agent
electronically a duly completed report in the form of Exhibit D-8 hereto, (the
"Collateral Agent Daily Report") specifying and certifying the then total
Collateral Value of the Eligible Mortgage Collateral and other information, all
as more fully provided for therein and as set forth on Schedule I hereto,
noting, except for any Wet Loans and other Mortgage Loans with respect to which
the Collateral Agent has not completed its review of the Principal Mortgage
Documents, any applicable Exceptions on Schedule I thereto.
(i) The Collateral Agent may assume the accuracy of
all information supplied by the Borrower to the Collateral
Agent in any Assignment, or related electronic transmission,
received by the Collateral Agent, including but not limited to
the acquisition price paid for any Mortgage Loan, the unpaid
principal balance of any Mortgage Loan as of its closing and
funding date and the weighted average Market Value used in the
related Collateral Value calculation and whether the Mortgage
Loan is a Conforming Loan, and Alt-A Loan, a Jumbo Loan or a
Super Jumbo Loan; and
(ii) The Collateral Agent may assume the accuracy of
the information supplied by the Borrower to the Collateral
Agent, whether written or in any other form acceptable to the
Collateral Agent, with respect to a determination as to
whether amounts received in the Collection Account represent
the purchase price paid for a specific Mortgage Loan and,
consequently, whether the Collateral Value of such Mortgage
Loan should be removed from such calculation.
(b) Two Business Days prior to the date on which the
Maximum Facility Amount has changed, the Servicer shall notify the Collateral
Agent and the Borrower (by facsimile) of the new Maximum Facility Amount under
the Loan Agreement. For purposes of the Collateral Agent Daily Report, the
Collateral Agent shall assume that the Maximum Facility Amount is $1,150,000,000
unless it receives written notice to the contrary from the Administrative Agent.
(c) The Collateral Agent shall monitor and report on the
Collateral Agent Daily Report the amount of Wet Loans and the portion thereof
for which the related Principal Mortgage Documents have been delivered to the
Collateral Agent within the time period permitted under Section 3.7.
3.9. Further Obligations of the Collateral Agent.
The Collateral Agent shall promptly notify the Administrative Agent if
the Collateral Agent receives written notice (i) that any Lien (other than for
the Administrative Agent for the benefit of the holders of the Obligations) has
been placed, or attempted to be placed, on any Collateral for the Obligations or
that the Administrative Agent's security interest shall have been challenged or
(ii) that any Approved Take-Out Investor has rejected any Collateral that is
related
11
to a Mortgage Loan that has been delivered to the Collateral Agent as Collateral
for the Obligations.
3.10. Segregation of Collateral.
The Collateral Agent shall keep and maintain the Collateral on its
documents, books and records separate and apart from its other Property and from
any Property securing any liabilities of the Borrower to any other Person.
Without limitation of the foregoing, the Collateral Agent shall keep and
maintain the Collateral on its documents, books and records separate and apart
from any collateral provided by the Borrower in favor of any other lender
providing financing to the Borrower. This provision does not require physical
separation of the Principal Mortgage Documents or Other Mortgage Documents from
collateral held for other loans, but each Mortgage Loan must be maintained in a
separate file folder from the documents related to any other mortgage loan.
3.11. Delivery of Required Documents to the Administrative Agent.
Upon written request of the Administrative Agent, after the occurrence
of and during the continuation of an Event of Default under the Loan Agreement
of which a Responsible Officer of the Collateral Agent has received written
notice, the Collateral Agent shall deliver within two (2) Business Days (or in
contemplation of removing the Collateral Agent as collateral agent hereunder,
the Collateral Agent shall deliver within five (5) Business Days,) to the
Administrative Agent or its designee any or all documents and other items of
Collateral which are then in the possession or control of the Collateral Agent.
The Administrative Agent shall provide the Borrower with a copy of any such
notice delivered to the Collateral Agent. All special handling and delivery
costs shall be paid by the Borrower.
3.12. Hedge Reporting.
The Servicer shall prepare a duly completed Hedge Report in the form of
Exhibit K to the Loan Agreement on the close of business on the last Business
Day of each week and shall provide such Hedge Report to the Borrower and the
Administrative Agent no later than 10:00 am (eastern time) on the following
Business Day.
ARTICLE IV
THE COLLATERAL AGENT
4.1. Instructions to the Collateral Agent.
As to any matter not expressly provided for by this Agreement, the
Collateral Agent shall not be required to exercise any discretion or take any
action, but shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the instructions of
the Administrative Agent acting on behalf of the holders of the Obligations;
provided, however, that the Collateral Agent shall not be required to take any
action which may expose the Collateral Agent to any liability that such
Collateral Agent determines to be unreasonable in light of the circumstances or
that is contrary to this Agreement or any Governmental Requirement.
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4.2. Reliance by the Collateral Agent; Responsibility of the Collateral
Agent.
(a) The Collateral Agent shall perform its duties
hereunder in accordance with the standards followed by the Collateral Agent in
dealing with similar property for its own account. Notwithstanding anything to
the contrary in this Agreement or any other Transaction Document, neither the
Collateral Agent nor any of its respective directors, officers, agents,
representatives, employees, attorneys-in-fact or Affiliates shall be liable for
any action taken or omitted to be taken by it or them (in their capacity as or
on behalf of the Collateral Agent) under or in connection with this Agreement or
the other Transaction Documents, except for its or their own gross negligence or
willful misconduct, for which the Collateral Agent shall be liable. In no event
shall the Collateral Agent, its directors, officers, agents or employees be
liable, directly or indirectly, for any special, indirect, punitive or
consequential damages.
(b) All Collateral at any time delivered to the
Collateral Agent hereunder shall be held by the Collateral Agent in a fire
resistant vault, drawer or other suitable depositary maintained and controlled
solely by the Collateral Agent, conspicuously marked to show the interest
therein of the Collateral Agent as bailee for the Administrative Agent on behalf
of the holders of the Obligations and not commingled with any other assets or
property of, or held by, the Collateral Agent for any person other than the
Borrower or any of the Originators. The Collateral Agent shall have
responsibility only for documents which have been actually delivered to the
Collateral Agent in connection herewith and which have not been released to the
Administrative Agent, the Borrower, the Servicer, a transferee or their
respective agent or designee in accordance with this Agreement. In the event
that a Mortgage Note has been delivered to the Collateral Agent and,
subsequently, the Collateral Agent cannot locate such Mortgage Note, then the
Collateral Agent shall prepare and execute a lost note affidavit with
appropriate indemnification and shall deliver such lost note affidavit to the
party that otherwise would have been entitled to delivery of the related
Mortgage Note in accordance with this Agreement at the time such Mortgage Note
would have been delivered.
(c) Under no circumstances shall the Collateral Agent be
obligated to verify the authenticity of any signature on any of the documents
received or examined by it in connection with this Agreement or the authority or
capacity of any person to execute or issue any such document nor shall the
Collateral Agent be responsible for the value, form, substance, validity,
perfection (other than by taking and continuing possession of the Collateral),
priority, effectiveness or enforceability of any of such documents nor shall the
Collateral Agent be under a duty to inspect, review or examine the documents to
determine whether they are appropriate for the represented purpose or that they
have been actually recorded or that they are other than what they purport to be
on their face.
(d) The Collateral Agent may accept but shall not be
responsible for examining, determining the meaning or effect of, or notifying or
advising the Borrower or the Administrative Agent in any way concerning, any
item or document in any file regarding a Mortgage Loan that is not one of the
items or documents listed in Section 3.2(b). The Borrower shall be solely
responsible for providing to the Collateral Agent each and every document listed
in Section 3.2(b) and for completing or correcting any omission, or incomplete
or inconsistent document.
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(e) With respect to the calculations in connection with
Collateral Agent Daily Reports, the Collateral Agent shall be entitled to rely
upon the information contained in any Assignment. The Collateral Agent shall (i)
except for Wet Loans for which it has not yet received the Principal Mortgage
Documents, hold all Principal Mortgage Documents relating to each Mortgage Loan
exclusively for the benefit of the holders of the Obligations under the terms of
this Agreement (i.e., is not held by the Collateral Agent for the benefit of any
other Person), and (ii) in the case of Wet Loans, monitor and report the amount
of such Wet Loans and the portion thereof for which the related Principal
Mortgage Documents have been delivered to the Collateral Agent within the time
period permitted under Section 3.7. Except as otherwise expressly provided in
this Agreement, the Collateral Agent shall have no duty to investigate or
conduct any due diligence with respect to such information.
(f) With respect to the determination of whether a
Mortgage Loan constitutes an Eligible Mortgage Loan, the Collateral Agent shall
be responsible for determining that: (i) such Mortgage Loan meets the
requirements of clauses (a)(ii)), (d) (with respect to (d), it being understood
and agreed that the Collateral Agent is not responsible to determine whether the
related Mortgage Note is a legal, valid and binding obligation of the Obligor),
(e), (i(iv-vi)), (j) and (m) of the definition of Eligible Mortgage Loan, (ii)
that no more than 45 days have lapsed since the date on which the original
Mortgage Note evidencing such Mortgage was shipped to the related Approved
Take-Out Investor, and (iii) pursuant to Sections 3.9(i), 3.10 and 4.2(e), to
the Collateral Agent's best knowledge such Mortgage Loan is subject to a
perfected first-priority Lien in favor of the Administrative Agent for the
benefit of the holders of the Obligations, and, to the Collateral Agent's best
knowledge, is not subject to any other Lien; but the Collateral Agent may assume
that all of the other requirements of the definition of Eligible Mortgage Loan
have been satisfied.
(g) The Collateral Agent is an agent and bailee only and
is not intended to be, nor shall it be construed to be a trustee or fiduciary
under this Agreement of or for either or both of the Borrower or the
Administrative Agent.
(h) The Collateral Agent shall retain possession and
custody of the Principal Mortgage Documents received from the Borrower and
pertaining to each Mortgage Loan file as agent and bailee of, and as custodian
for, the Administrative Agent for all purposes (including but not limited to the
perfection of the security interest of the Administrative Agent for the benefit
of the holders of the Obligations) until the Collateral is released pursuant to
Section 3.4 or 3.5 hereof.
(i) Without limitation of the generality of the
foregoing, the Collateral Agent: (i) may consult with legal counsel (including
counsel for the Borrower), independent public accountants and other experts
selected by the Collateral Agent or the Borrower and shall not be liable for any
action taken or omitted to be taken in good faith by it in accordance with the
advice of such counsel, accountants or experts; (ii) except as provided in this
Agreement, makes no warranty or representation to the Administrative Agent or
the holders of any Obligations and shall not be responsible to the
Administrative Agent or the holders of any Obligations for any statements,
warranties or representations made in or in connection with this Agreement or
the other Transaction Documents; (iii) except as provided in Sections 3.2(e),
3.4(a), (b), (c), (h), 3.8, 3.9 and this Section 4.2, shall not have any duty to
ascertain or to inquire as to the performance
14
or observance of any of the terms, covenants or conditions of this Agreement on
the part of the Borrower or to inspect the property (including the books and
records) of the Borrower; (iv) shall not be responsible to the Administrative
Agent or the holders of any Obligations for the due execution, legality,
validity, enforceability of this Agreement or any other instrument or document
furnished pursuant hereto as it relates to any party other than the Collateral
Agent, or for the genuineness, effectiveness, sufficiency, value, perfection or
priority of any Collateral; (v) shall incur no liability under or in respect of
this Agreement by acting upon any notice, consent, certificate or other
instrument or writing (which may be by telegram, telecopy, cable or telex)
believed in good faith by the Collateral Agent, to be genuine and signed or sent
by the proper Person; (vi) shall be entitled to rely on the terms of this
Agreement and shall be under no obligation to review the terms of the other
Transaction Documents, and in the event of any conflict between this Agreement
and the Transaction Documents, the terms of this Agreement shall control with
respect to the rights and obligations of the Collateral Agent; and (vii) in the
event of any amendment, revision, restatement, waiver or other change to the
Transaction Documents which could have the effect of increasing the level of
effort or changing the scope of work of the Collateral Agent under this
Agreement and which was not consented to in writing by the Collateral Agent,
shall not be given effect so as to modify in quantity or otherwise the
obligations of the Collateral Agent under this Agreement; (as an example only of
the foregoing, and to avoid doubt in interpretation of this subsection (vii), an
increase in the aggregate commitments of the Lenders of the Loan Agreement shall
not, unless the Collateral Agent receives two weeks' advance written notice of
any such amendment, revision, restatement, waiver or other change to the
Transaction Documents, require the Collateral Agent to review Mortgage Loan
Collateral that would relate to such increased commitment).
(j) The Collateral Agent may execute any of its duties
under this Agreement by or through agents, attorneys, custodians, nominees or
attorneys-in-fact (which agents, attorneys, custodians, nominees or
attorneys-in-fact shall be accorded the same rights and obligations applicable
to the Collateral Agent) and shall be entitled to advice of counsel concerning
all matters pertaining to such duties. The Collateral Agent shall be responsible
for the actions or non-actions of any agent, attorneys, custodians, nominees or
attorneys-in-fact selected by it to the extent it would have been liable had it
taken such action itself; provided, however, that nothing contained herein shall
affect in any manner or any extent the rights of the Borrower or the
Administrative Agent against such agents or attorneys-in-fact.
(k) Merger of Collateral Agent. Any entity into which the
Collateral Agent may be merged or converted or with which may be consolidated,
or any entity resulting from any merger, conversion or consolidation to which
the Collateral Agent shall be a party, or any entity succeeding to the business
of the Collateral Agent, shall be the successor of the Collateral Agent
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.
(l) None of the provisions of this Agreement shall
require the Collateral Agent to expend or risk its own funds or otherwise to
incur any liability, financial or otherwise, in the performance of any of its
duties hereunder, or in the exercise of any of its rights or powers if it shall
have reasonable grounds for believing that repayment of such funds or indemnity
satisfaction to it against such risk or liability is not assured to it.
15
(m) The Collateral Agent may conclusively rely and shall
be fully protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request, consent,
order, approval or other paper or document believed by it to be genuine and to
have been signed or presented to the proper party or parties.
4.3. Agents and Affiliates.
The Collateral Agent and its respective Affiliates may accept deposits
from, lend money to, act as trustee under indentures of, and generally engage in
any kind of business with, the Borrower, any of the Originators, any of the
Originators' Affiliates and any Person who may do business with or own
securities of the Borrower or any such Affiliate, all as if the Collateral Agent
were not the Collateral Agent and without any duty to account therefor to the
Administrative Agent or the holders of any Obligations.
4.4. Successor Collateral Agent.
The Collateral Agent may resign at any time by giving written notice
thereof to the Borrower and the Administrative Agent. The Collateral Agent may
be removed at any time with cause, and upon thirty (30) days written notice
without cause, by the Administrative Agent on behalf of the holders of the
Obligations. Upon request of the Borrower, so long as no Default or Event of
Default exists, the Collateral Agent shall be removed by the Administrative
Agent, provided that any removal without cause shall be preceded by thirty (30)
days written notice to the Collateral Agent and the Borrower shall pay
immediately upon demand all costs and expenses incurred by any Lender, the
Administrative Agent or the Collateral Agent in connection therewith. Upon any
such resignation or removal, the Administrative Agent, at the direction of the
Majority Banks, shall have the right to appoint a successor Collateral Agent.
Any successor Collateral Agent appointed by the Administrative Agent, provided
that no Default or Event of Default exists, shall be satisfactory to the
Borrower at the time of appointment. In the case of a retirement or resignation,
if no successor Collateral Agent shall have been so appointed by the
Administrative Agent (and approved by the Borrower, if applicable), and shall
have accepted such appointment, within 60 days after the retiring Collateral
Agent's giving of notice of resignation, then the retiring Collateral Agent
shall deliver all Mortgage Loan Collateral in its possession to the
Administrative Agent and the Collateral Agent shall be discharged from its
duties and obligations under this Agreement. After a notice of retirement or
resignation has been given by the Collateral Agent and until a successor
Collateral Agent shall have been appointed, the Administrative Agent shall pay
all reasonable fees and out of pocket expenses owed to the Collateral Agent by
the Servicer pursuant to any written agreement between the Collateral Agent and
the Servicer, provided, however, that the Borrower shall reimburse the
Administrative Agent for all such payments. No such resignation or removal shall
be effective until the earlier of (1) the date on which a successor Collateral
Agent shall have been appointed, and accepted such appointment, in accordance
with this Section 4.4 or (2) the day upon which a period of 60 days has passed
after notice of such resignation or removal. Upon the acceptance of any
appointment of the Collateral Agent hereunder by a successor Collateral Agent,
such successor Collateral Agent shall thereupon succeed to and become vested
with all the rights, powers, privileges and duties of the retiring Collateral
Agent, and the retiring Collateral Agent shall be discharged from its duties and
obligations under this Agreement. The retiring or removed Collateral Agent shall
take all steps reasonably necessary to provide for an orderly transfer of the
Collateral and all
16
related documentation to the successor Collateral Agent at the Servicer's
expense. After any retiring Collateral Agent's resignation or removal hereunder
as the Collateral Agent, the provisions of this Article IV shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was a
Collateral Agent under this Agreement.
4.5. Right of Inspection.
The Collateral Agent shall permit any officer, employee or agent of the
Borrower, the Servicer or the Administrative Agent that may so request to visit
and inspect the premises on which the custodial duties of the Collateral Agent
hereunder are performed, examine the books and records of the Collateral Agent
which pertain to such custodial duties, take copies and extracts therefrom, and
discuss the performance of such custodial duties with the officers of the
Collateral Agent that are responsible therefor, at such time, after reasonable
prior written notice to the Collateral Agent, as may be mutually acceptable to
the Collateral Agent and such Borrower, Servicer or Administrative Agent during
the Collateral Agent's normal business hours.
4.6. Accounting in Certain Circumstances.
Subject to the provisions of Section 4.2 hereof, in the event that the
Collateral Agent, acting in its capacity as custodian for the Administrative
Agent, shall receive any money in respect of Mortgage Loan Collateral, whether
pursuant to Section 3.4 hereof or Section 5 of the Security Agreement, or
otherwise, the Collateral Agent shall provide an accounting therefor to the
Administrative Agent and the Borrower by the end of the Business Day following
receipt thereof, such accounting to include the amount received and shall
promptly (but in no event later than the next Business Day) deposit such amounts
into the Collection Account and prior to such deposit to be held as Collateral
under the Security Instruments in favor of the Administrative Agent as provided
in Section 3.1; provided, however, that all expenses of the Collateral Agent
reasonably allocable to such accounting shall be added to the Obligations as
expenses of the Collateral Agent. All such funds received after 4:00 p.m.
(eastern time) shall be considered to have been received on the following
Business Day. All such funds received shall be held uninvested (and the
Collateral Agent shall not be liable for interest thereon), unless permitted by
the applicable Transaction Document and otherwise instructed by the Servicer,
and in such case, funds shall be invested in Eligible Investments specified by
the Servicer in such instructions; provided, however, that if the Servicer
directs that funds be invested in Eligible Investments, the Servicer shall be
required to ensure that all investments must mature on each Settlement Date (as
defined in the Loan Agreement). The Collateral Agent shall provide such other
information in such detail and at such time or times as the Borrower or the
Administrative Agent may reasonably request.
17
ARTICLE V
INDEMNIFICATION
5.1. Indemnities by the Servicer. Without limiting any other rights
that any such Person may have hereunder or under applicable law, the Servicer
hereby agrees to indemnify the Collateral Agent, its successors, transferees,
participants and assigns and all affiliates, officers, directors, shareholders,
controlling persons, employees and agents of any of the foregoing (each an
"Indemnified Party"), forthwith on demand, from and against any and all actual
damages, losses, claims, liabilities and related costs and expenses, including
attorneys' fees, expenses and disbursements (all of the foregoing being
collectively referred to as "Indemnified Amounts") awarded against or incurred
by any of them arising out of or relating to this Agreement, the Security
Agreement, the Collection Account Control Agreement, the Reserve Account Control
Agreement or the Loan Agreement or the exercise or performance of any of its or
their powers or duties hereunder or thereunder, or in respect of any Mortgage
Loans or Take-Out Commitment, or related in any way to their possession of, or
dealings with, the Collateral, excluding, however, Indemnified Amounts to the
extent resulting from gross negligence or willful misconduct on the part of such
Indemnified Party. This Section 5.1 shall survive the termination of this
Agreement and the earlier resignation or removal of the Collateral Agent.
ARTICLE VI
MISCELLANEOUS
6.1. Notices.
Any notice, demand or request required or permitted to be given under
or in connection with this Agreement, the Notes or the other Transaction
Documents (except as may otherwise be expressly required therein) shall be in
writing and shall be mailed by first class or express mail, postage prepaid, or
sent by telex, telegram, telecopy or other similar form of rapid transmission,
confirmed by mailing (by first class or express mail, postage prepaid) written
confirmation at substantially the same time as such rapid transmission, or
personally delivered to an officer of the receiving party. With the exception of
certain administrative and collateral reports that may be directed to specific
departments of the Administrative Agent, all such communications shall be
mailed, sent or delivered to the parties hereto at their respective addresses as
set forth in Schedule II hereto, or at such other addresses or to such
officer's, individual's or department's attention as any party may have
furnished the other parties in writing. Any communication so addressed and
mailed shall be deemed to be given when so mailed, except with respect to
notices and requests given pursuant to Sections 2.3 and 3.3 of the Loan
Agreement. Communications related thereto shall not be effective until actually
received by the Collateral Agent, the Administrative Agent, the Issuer or the
Borrower, as the case may be; and any notice so sent by rapid transmission shall
be deemed to be given when receipt of such transmission is acknowledged, and any
communication so delivered in person shall be deemed to be given when receipted
for by, or actually received by, an authorized officer of the Collateral Agent,
the Administrative Agent or the Borrower, as the case may be.
18
6.2. Amendments, Etc.
This Agreement may not be amended, supplemented or modified without the
written consent of the Borrower, the Collateral Agent and the Administrative
Agent. Any such waiver and any such amendment, supplement or modification shall
be binding upon the Borrower the Collateral Agent, the Administrative Agent and
all holders of the Obligations.
6.3. Invalidity.
In the event that any one or more of the provisions contained in this
Agreement or any other Transaction Document shall, for any reason, be held
invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of such document.
6.4. Survival of Agreements.
All covenants and agreements herein shall survive until payment in full
of the Obligations and termination of the Bank Commitments under the Loan
Agreement.
6.5. Cumulative Rights.
The rights, powers, privileges and remedies of the Collateral Agent and
the Administrative Agent under this Agreement, and any other Transaction
Document shall be cumulative, and the exercise or partial exercise of any such
right, power, privilege or remedy shall not preclude the exercise of any other
right or remedy. The exercise of any right, power, privilege or remedy of the
Collateral Agent or the Administrative Agent under this Agreement or any
Transaction Document, shall not exhaust any such right, power, privilege or
remedy of the Collateral Agent or the Administrative Agent.
6.6. Construction; Governing Law.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAW OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS
PRINCIPLES THEREOF, OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW WHICH SHALL APPLY HERETO).
6.7. Successors and Assigns.
This Agreement is binding upon and inures to the parties to this
Agreement and their respective successors and permitted assigns and shall remain
in full force and effect until such time, after the Termination Date, as all
Obligations shall have been paid in full and all other obligations to be
performed hereunder shall have been performed. The Borrower's obligations in
respect of indemnification and payment provisions shall be continuing and shall
survive any termination of this Agreement, subject to any applicable statute of
limitations. The Collateral Agent may not assign its rights or obligations
hereunder, except pursuant to Section 4.2(k) or 4.4, and any such attempted
assignment shall be null and void.
19
6.8. The Collateral Agent Representations and Warranties.
The Collateral Agent represents and warrants that it: (a) is a national
banking association; (b) has the power and authority to own its properties and
assets and to transact the business in which it is engaged; and (c) has the
power and requisite authority to execute, deliver and perform this Agreement,
and is duly authorized to, and has taken all action necessary to authorize it
to, execute, deliver and perform this Agreement.
6.9. [Reserved].
6.10. Counterparts.
This Agreement may be executed in two or more counterparts, and it
shall not be necessary that the signatures of each of the parties hereto be
contained on any one counterpart hereof; each counterpart shall be deemed an
original, but all counterparts together shall constitute one and the same
instrument.
6.11. No Proceedings.
The Collateral Agent hereby agrees that it will not institute against
the Issuer, or join any other Person in instituting against the Issuer, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding,
or other proceeding under any federal or state bankruptcy or similar law, for
one year and one day after the latest Commercial Paper Note issued by the Issuer
is paid.
6.12. Electronic Counterparts.
Any form or report contemplated by this Agreement may be furnished to
the Collateral Agent electronically and may be formatted in a manner convenient
for electronic transmission so long as the required information is provided in
an equally useable form to the format, if any, provided in this Agreement. It
being understood and agreed that the Collateral Agent shall not be responsible
to verify the identity of the sender of any electronic transmissions received by
it.
6.13. Waiver of Jury Trial.
EACH OF THE PARTIES HERETO HEREBY EXPRESSLY WAIVES ANY RIGHT TO A TRIAL
BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS
AGREEMENT, THE NOTES, ANY OTHER TRANSACTION DOCUMENT OR UNDER ANY AMENDMENT,
INSTRUMENT OR DOCUMENT DELIVERED OR THAT MAY IN THE FUTURE BE DELIVERED IN
CONNECTION HEREWITH OR ARISING FROM ANY BANKING OR OTHER RELATIONSHIP EXISTING
IN CONNECTION WITH THIS AGREEMENT, THE NOTES OR ANY OTHER TRANSACTION DOCUMENT
AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND
NOT BEFORE A JURY.
20
6.14. Consent to Jurisdiction; Waiver of Immunities.
EACH PARTY HERETO HEREBY ACKNOWLEDGES AND AGREES THAT:
(a) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER TRANSACTION DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE
STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK
AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE PARTIES HERETO
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES, TO
THE MAXIMUM EXTENT PERMITTED BY LAW, ANY OBJECTION, INCLUDING, WITHOUT
LIMITATION, ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF
FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY
ACTION OR PROCEEDING IN SUCH JURISDICTION WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER TRANSACTION DOCUMENT.
(b) TO THE EXTENT THAT IT HAS OR HEREAFTER MAY ACQUIRE
ANY IMMUNITY FROM THE JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS
(WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN
AID TO EXECUTION, EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS
PROPERTY, IT HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS
OBLIGATIONS UNDER OR IN CONNECTION WITH THIS AGREEMENT.
6.15. References to Loan Agreement. Notwithstanding any references
herein to the Loan Agreement, the parties hereto acknowledge that the Collateral
Agent is not a party to the Loan Agreement and has no obligations or rights
thereunder and shall not be obligated to read the Loan Agreement, know the terms
and conditions contained therein or to be on notice of any of its provisions.
* * * * *
21
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be
duly executed as of the date first above written.
AHM SPV I, LLC,
as Borrower
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
AMERICAN HOME MORTGAGE SERVICING, INC.
as Servicer
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Executive Vice President, General
Counsel & Secretary
CALYON NEW YORK BRANCH,
as Administrative Agent
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Director
By: /s/ Kostantina Kourmpetis
-----------------------------------------
Name: Kostantina Kourmpetis
Title: Managing Director
DEUTSCHE BANK NATIONAL TRUST COMPANY,
as Collateral Agent
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
22
SCHEDULE I
COLLATERAL REVIEW FUNCTIONS
In each Collateral Agent Daily Report, the Collateral Agent shall
certify, with respect to each Mortgage Loan listed in the schedule attached
thereto, the following, noting any applicable Exceptions on the schedule
thereto:
(a) all documents required to be delivered to it pursuant to Sections
3.2(b)(i) through (iii) of the Collateral Agency Agreement are in
Collateral Agent's possession.
(b) each assignment of a Mortgage Loan delivered by the Borrower
pursuant to Section 3.2(b) bears an original signature of an officer of
the Borrower or one of the Originators, and appears to be duly
completed (including all Schedules thereto).
(c) each Mortgage Note and Mortgage bears an original signature or
signatures which appear to be those of the person or persons named as
the maker and Mortgagor (trustor) or, in the case of a certified copy
of the Mortgage, such copy bears what appears to be a reproduction of
such signature or signatures.
(d) except for the endorsement in blank of the Mortgage Note by either
of the Originators, and any intervening endorsements, neither the
Mortgage Note nor the Mortgage contain any irregular writings which
appear on their face to affect the validity of any such endorsement or
to restrict the enforceability of the document on which they appear.
(e) based only on the Collateral Agent's examination of the documents
listed in Section 3.2(b)(i) through (iii) of the Collateral Agency
Agreement, the information set forth with respect to each Mortgage Loan
on Schedule I to the related Assignment accurately reflects the
following (within the tolerances, if any, shown in parentheses):
(i) Mortgage Loan number,
(ii) the maturity date (within 30 days),
(iii) the original loan amount,
(iv) the original interest rate,
(v) the name of the borrower(s), and
(vi) the property address.
(f) each assignment of mortgage has been assigned as described in
Section 3.2(b)(ii) of the Collateral Agency Agreement, provided that
the Collateral Agent shall have no obligation to confirm that the
assignments are in recordable form. If intervening assignments are
included in the file, each such intervening assignment bears the
signature
I-1
of the mortgagee and/or the assignor (and any other subsequent
assignors) that appears to be an original or, if photocopies, that such
copies bear a reproduction of such signature or signatures.
(g) the Mortgage Note is endorsed in blank and such endorsement bears
an original signature of an officer of either of the Originators.
(h) no Mortgage Note has an original principal balance in excess of
$2,500,000.
(i) no Mortgage Loan bears evidence (on its face or reverse side) that
it is subject to any Lien in favor of any Person other than the
Administrative Agent, for the benefit of the holders of the
Obligations.
(j) except as shown on the attached list of Exceptions, no Mortgage
Loan has been included in the Collateral Agent Daily Report for more
than 90 days.
I-2
SCHEDULE II
ADDRESSES AND NOTICES
Borrower: AHM SPV I, LLC
c/o American Home Mortgage Holdings, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ Telephone: (516)
396-7703 Attention: General Counsel
Servicer: AMERICAN HOME MORTGAGE SERVICING, INC.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ Telephone: (516)
396-7703 Attention: General Counsel
Administrative Agent: CALYON NEW YORK BRANCH
Calyon Building
1301 Avenue of the Americas
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telex No.: 62410
(Answerback: CRED A 62410 UW)
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Conduit Securitization
Collateral Agent: DEUTSCHE BANK NATIONAL TRUST COMPANY
Corporate Trust & Agency Services
▇▇▇▇ ▇▇▇▇ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Mortgage Custody - AH031C
II-1
DEFINITIONS
As used in this Agreement, the following terms have the following
meanings:
"Administrative Agent" means Calyon, in its capacity as administrative
agent for the Lenders, or any successor administrative agent.
"Advance" means any amount disbursed by the Lenders to the Borrower,
whether such amount constitutes an original disbursement of funds to the
Borrower under the Loan Agreement or a continuation of an amount outstanding.
"Advanced Funds" means funds advanced to an escrow agent for purposes
of funding a Mortgage Loan to be pledged hereunder.
"Advance Rate" means (i) with respect to a Conforming Loan,
ninety-eight percent (98%) or, if a Conforming FICO Score Trigger Event or
Conforming Loan-to-Value Ratio Trigger Event has occurred and is continuing, as
reported to the Collateral Agent by the Administrative Agent, then zero, (ii)
with respect to a Jumbo Loan (other than a Super Jumbo Loan), ninety-eight
percent (98%) or, if a Non-Conforming FICO Score Trigger Event or Non-Conforming
Loan-to-Value Ratio Trigger Event has occurred and is continuing, as reported to
the Collateral Agent by the Administrative Agent, then zero, (iii) with respect
to a Super Jumbo Loan, ninety-five percent (95%) or, if a Non-Conforming FICO
Score Trigger Event or Non-Conforming Loan-to-Value Ratio Trigger Event has
occurred and is continuing, as reported to the Collateral Agent by the
Administrative Agent, then zero and (iv) with respect to an Alt-A Loan, ninety
seven percent (97%) or, if a Non-Conforming FICO Score Trigger Event or
Non-Conforming Loan-to-Value Ratio Trigger Event has occurred and is continuing,
as reported to the Collateral Agent by the Administrative Agent, then zero.
"Affected Party" means each Lender, the Administrative Agent, each
Managing Agent, any party providing credit enhancement or liquidity to an
Issuer, and any permitted assignee or participant of any Lender, and any holding
company of an Affected Party.
"Affiliate" of any Person means (a) any other Person that, directly or
indirectly, controls, is controlled by, or is under common control with, such
Person, or (b) any other Person who is a director, officer or employee (i) of
such Person, or (ii) of any Person described in the preceding clause (a). For
purposes of this definition, the term "control" (and the terms "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession or ownership, directly or indirectly, of the power either (x) to
direct or cause the direction of the management and policies of such Person,
whether by contract or otherwise, or (y) vote 10% or more of the securities
having ordinary power in the election of directors of such Person.
"Agreement" means this Amended and Restated Collateral Agency
Agreement, as amended, modified or supplemented from time to time.
"AHMIC" means American Home Mortgage Investment Corp., a Maryland
corporation.
"Alt-A Loan" means a Mortgage Loan (other than a Conforming Loan or a
Jumbo Loan) that (1) does not conform to the conventional underwriting standards
of ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇
D1-1
Mac or ▇▇▇▇▇▇ Mae but that is underwritten in a manner designed to be purchased
by an Approved Take-Out Investor (other than ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇
Mae), within guidelines generally acceptable to industry norms for "Alt-A"
loans, (2) has a demonstrated secondary market and is readily securitizable, and
(3) matches all applicable requirements for purchase under the requirements of a
Take Out Commitment or Hedge specifically issued for the purchase of such
Mortgage Loan.
"American Home Mortgage Servicing, Inc." has the meaning set forth in
the preamble of this Agreement, and its successors and assigns.
"Amsterdam" has the meaning set forth in the Loan Agreement.
"Approved Hedge Counterparty" means:
(a) ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇ Mae, or
(b) any Person with short-term ratings of at least P-1 from
▇▇▇▇▇'▇, and either at least A-1 from S&P or at least F1 from Fitch, or
long-term unsecured debt ratings (or in the case of a bank without such
ratings that is the principal subsidiary of a bank holding company, the
rating of the bank holding company) of at least Aa2 by ▇▇▇▇▇'▇, and
either at least AA from S&P or at least AA from Fitch, or
(c) any Person with short-term ratings of at least P-1 from
▇▇▇▇▇'▇, and either at least A-1 from S&P or at least F1 from Fitch, or
long-term unsecured debt ratings (or in the case of a bank without such
ratings that is the principal subsidiary of a bank holding company, the
rating of the bank holding company) of at least A, A2 and A from S&P,
▇▇▇▇▇'▇ and Fitch, respectively (or at least two out of the three
Rating Agencies), limited to a concentration limit of 50% of the
concentration percentage for such Person as shown on Schedule II, or
such other concentration percentage approved by the Administrative
Agent, or
(d) all other Persons as may be approved by the Majority
Banks, which approvals may be subject to certain concentration limits;
provided that (i) except for an Approved Hedge Counterparty defined
above in section (d), if an Approved Hedge Counterparty has a short-term rating
or a long-term unsecured debt rating at the time such Person becomes an
"Approved Hedge Counterparty" and such Person's short-term ratings or long-term
unsecured debt ratings are subsequently downgraded or withdrawn, such Person
shall cease to be an "Approved Hedge Counterparty"; provided, further, that with
respect to any ▇▇▇▇▇▇ issued by such Person prior to the date of such downgrade
or withdrawal, such Person shall cease to be an "Approved Hedge Counterparty"
sixty (60) days following such downgrade or withdrawal; and (ii) if an Approved
Hedge Counterparty does not have a short-term rating or a long-term unsecured
debt rating, such Person shall cease to be an "Approved Hedge Counterparty" upon
prior written notice from the Administrative Agent, which shall provide such
notice if the Administrative Agent has (or if the Majority Banks notify the
Administrative Agent that they have) good faith concerns about the future
performance of such Person; provided, further, that with respect to any ▇▇▇▇▇▇
issued by such Person prior to
D1-2
such notice, such Person shall cease to be an "Approved Hedge Counterparty"
sixty (60) days following such notice.
"Approved Take-Out Investor" means:
(a) ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇ Mae, or
(b) any Person with short-term ratings of at least P-1 from ▇▇▇▇▇'▇,
and either or at least A-1 from S&P or at least F1 from Fitch, or long-term
unsecured debt ratings (or in the case of a bank without such ratings that is
the principal subsidiary of a bank holding company, the rating of the bank
holding company) of at least Aa2 by ▇▇▇▇▇'▇ and either at least AA from, S&P or
at least AA from Fitch, or
(c) any Person with short-term ratings of at least P-1 from ▇▇▇▇▇'▇,
and either at least A-1 from S&P or at least F1 from Fitch, or long-term
unsecured debt ratings (or in the case of a bank without such ratings that is
the principal subsidiary of a bank holding company, the rating of the bank
holding company) of at least A, A2 and A from S&P, ▇▇▇▇▇'▇ and Fitch,
respectively (or at least two out of the three Rating Agencies), limited to a
concentration limit of 50% of the concentration percentage for such Person as
shown on Schedule II, or such other concentration percentage approved by the
Majority Banks, or
(d) all other Persons as may be approved by the Majority Banks, which
approvals may be subject to certain concentration limits;
provided that (i) except for an Approved Take-Out Investor defined above in
section (d), if an Approved has a short-term rating or a long-term unsecured
debt rating at the time such Person becomes an "Approved Take-Out Investor" and
such Person's short-term ratings or long-term unsecured debt ratings are
subsequently downgraded or withdrawn, such Person shall cease to be an
"Approved"; provided, further, that with respect to any Take-Out Commitments
issued by such Person prior to the date of such downgrade or withdrawal, such
Person shall cease to be an "Approved Take-Out Investor" sixty (60) days
following such downgrade or withdrawal; and (ii) if an Approved Take-Out
Investor does not have a short-term rating or a long-term unsecured debt rating,
such Person shall cease to be an "Approved" upon prior written notice from the
Administrative Agent, which shall provide such notice if the Administrative
Agent has (or if the Majority Banks notify the Administrative Agent that they
have) good faith concerns about the future performance of such Person; provided,
further, that with respect to any Take-Out Commitments issued by such Person
prior to such notice, such Person shall cease to be an "Approved Take-Out
Investor" sixty (60) days following such notice; provided, further, that the
Collateral Agent may assume that the Approved sixty (60) Investors are listed on
the Schedule III hereto most recently distributed to the Collateral Agent by the
Administrative Agent.
As of the date of this Agreement, Schedule III hereto sets forth the
Approved Take-Out Investors pursuant to the preceding clauses (b) and (c) (and
any applicable concentration limits). Schedule III shall be updated from time to
time as Approved Take-Out Investors are added or deleted or concentration limits
are changed pursuant to the preceding clauses (b) and (c); provided, further,
that the Collateral Agent may rely on Schedule III until a new Schedule III is
distributed to the Collateral Agent by the Administrative Agent.
D1-3
"Assignment" is defined in Section 3.2(a).
"Bailee and Security Agreement Letter" is defined in Section 3.4(b)(i).
"Bank" means each of Calyon, Lloyds, ABN AMRO, SG, JPMorgan and each
respective Eligible Assignee that shall become a party to the Loan Agreement
pursuant to the terms of an "Assignment and Acceptance" (as defined in the Loan
Agreement).
"Bank Commitment" means the obligations of the Banks to make Advances
to the Borrower pursuant to the Loan Agreement.
"▇▇▇▇▇▇" has the meaning set forth in the Loan Agreement.
"Borrower" has the meaning specified in the preamble of this Agreement.
"Borrowing" means Advances by the Lenders under the Loan Agreement.
"Borrowing Report" means a request, in the form of Exhibit C to the
Loan Agreement for a Borrowing pursuant to Article II of the Loan Agreement and
in the form of Exhibit D-9 to this Agreement.
"Business Day" means (a) a day on which (i) commercial banks in New
York City, New York, and Chicago, Illinois, are not authorized or required to be
closed and (ii) commercial banks in the State in which the Collateral Agent has
its principal office are not authorized or required to be closed, and (b) if
this definition of "Business Day" is utilized in connection with a Eurodollar
Advance, a day on which dealings in United States dollars are carried out in the
London interbank market.
"Calyon New York" has the meaning set forth in the preamble of this
Agreement, and its successors and assigns.
"Calyon Group" mean LaFayette, and each Group Bank of LaFayette.
"Closing Protection Rights" means any rights of the Originators or the
Borrower to or under (i) a letter issued by a title insurance company to any of
the Originators assuming liability for certain acts or failure to act on behalf
of a named closing escrow agent, approved attorney or similar Person in
connection with the closing of a Mortgage Loan transaction, (ii) a bond,
insurance or trust fund established to protect a mortgage lender against a loss
or damage resulting from certain acts or failure to act of a closing escrow
agent, approved attorney, title insurance company or similar Person, or (iii)
any other right or claim that any of the Originators or the Borrower may have
against any Person for any loss or damage resulting from such Person's acts or
failure to act in connection with the closing of a Mortgage Loan and the
delivery of the related Mortgage Loan Collateral to the Collateral Agent, any of
the Originators or to the Borrower.
"Collateral" means Property that is subject to a Lien for the benefit
of the holders of the Obligations.
D1-4
"Collateral Agency Agreement" means this Agreement.
"Collateral Agent" has the meaning set forth in the preamble of this
Agreement.
"Collateral Agent Daily Report" is defined in Section 3.8(a) of this
Agreement.
"Collateral Deficiency" means, at any time, the amount by which the
Principal Debt exceeds the lesser of (a) the Collateral Value of all Eligible
Mortgage Collateral and (b) if the Collateral Agent holds no Eligible Mortgage
Collateral, zero.
"Collateral Value" means
(A) with respect to each Eligible Mortgage Loan and at all
times, an amount equal to the Advance Rate for such Mortgage Loan times
the least of:
(1) the lesser of the original principal amount of
such Eligible Mortgage Loan or the acquisition price paid by the
related Originator on the closing and funding of such Eligible Mortgage
Loan;
(2) ratable amount determined by multiplying (a) the
weighted average Market Value of all Mortgage Loans, owned by the
Originators or the Borrowers, as reflected on the most recent
Collateral Agent Daily Report, (it being understood that the Servicer
shall provide to the Collateral Agent such Market Value as of the close
of business on the last Business Day of the previous week, (or, while a
Default or Event of Default is continuing, more frequently if so
directed by the Administrative Agent)) times (b) the original principal
amount of such Eligible Mortgage Loan; and
(3) while a Default or Event of Default is
continuing or upon the direction of any Managing Agent, the Market
Value of such Eligible Mortgage Loan; and
(B) with respect to the Collection Account, the balance of
collected funds therein that is not subject to any Lien in favor of any
Person other than the Lien in favor of the Administrative Agent for the
benefit of the holders of the Obligations;
provided, however, that
(a) at any time, the portion of total Collateral Value that
may be attributable to Jumbo Loans shall not exceed fifty percent (50%)
of the Maximum Facility Amount;
(b) at any time, the portion of total Collateral Value that
may be attributable to Super Jumbo Loans shall not exceed three percent
(3%) of the Maximum Facility Amount, which percentage is a sublimit of
the limitation set forth in clause (a), equal to 6% of the 50% set
forth in clause (a) above;
(c) at any time, the portion of total Collateral Value that
may be attributable to Alt-A Loans shall not exceed thirty-five percent
(35%) of the Maximum Facility Amount;
D1-5
(d) at any time, the portion of total Collateral Value that
may be attributable to Non-Conforming Loans shall not exceed fifty
percent (50%) of the Maximum Facility Amount;
(e) at any time, the portion of total Collateral Value that
may be attributable to Mortgage Loans with a Loan-to-Value Ratio
greater than 95% shall not exceed five percent (5%) of the Maximum
Facility Amount;
(f) at any time, the portion of total Collateral Value that
may be attributable to Eligible Mortgage Loans (a) with a FICO Score
less than or equal to 640 shall not exceed twenty-five percent (25%) of
the Maximum Facility Amount and (b) with a FICO Score less than or
equal to 620 shall not exceed five percent (5%) of the Maximum Facility
Amount;
(g) at any time, the portion of total Collateral Value that
may be attributable to Mortgage Loans for which the Mortgage Notes have
been withdrawn for correction pursuant to Section 3.5 of this Agreement
shall not exceed 2.5% of the Maximum Facility Amount;
(h) [Reserved]
(i) at any time, the portion of total Collateral Value that
may be attributable to Mortgage Loans that have been Eligible Mortgage
Loans owned by the Borrower for more than 90 days shall be zero
provided, that this clause (i) shall not apply to 5% of the total
Collateral Value that may be attributable to Mortgage Loans that have
been Eligible Mortgage Loans owned by the Borrower for more than 90
days but less than 180 days;
(j) a Mortgage Loan that ceases to be an Eligible Mortgage
Loan shall have a Collateral Value of zero;
(k) at any time, (A) except the first five and last five
Business Days of any month, the portion of total Collateral Value that
may be attributable to Wet Loans shall not exceed thirty percent (30%)
of the Maximum Facility Amount, and (B) during the first five and last
five Business Days of any month, the portion of total Collateral Value
that may be attributable to Wet Loans shall not exceed fifty percent
(50%) of the Maximum Facility Amount; (it being understood that on any
day the Collateral Value of a Wet Loan with respect to which the
related Principal Mortgage Documents have not been delivered to the
Collateral Agent within nine (9) Business Days after the date of
origination of the Wet Loan shall be zero until such Principal Mortgage
Documents have been delivered); and
(l) at any time, a Mortgage Loan with respect to which the
related Obligor is sixty (60) days or more in payment default, shall
have a Collateral Value of zero.
"Collection Account" means the account established by the Borrower with
the Deutsche Bank Trust Company Americas or another Eligible Institution
acceptable to the Administrative Agent pursuant to Section 2.7(b) of the Loan
Agreement to be used for (i) the deposit of proceeds from the sale of Mortgage
Loans; and (ii) the payment of the Obligations, it being
D1-6
understood that such account is controlled by the Administrative Agent pursuant
to the Collection Account Control Agreement, and the Administrative Agent has
the authority to direct the transfer of all funds in the Collection Account.
"Collection Account Bank" means, initially, Deutsche Bank Trust Company
Americas and, at any time, the institution then holding the Collection Account
in accordance with the terms of the Collection Account Control Agreement.
"Collection Account Control Agreement" means the Amended and Restated
Collection Account Control Agreement, dated as of the date hereof, among the
Borrower, the Servicer, the Administrative Agent and the Collection Account
Bank, substantially in the form of Exhibit D-3 hereto, as amended, modified or
supplemented from time to time.
"Collection Account Release Notice" is defined in Section 3.4(a).
"Commercial Paper Notes" means short-term promissory notes issued or to
be issued by the Issuers to fund or maintain their Advances or investments in
other financial assets.
"Conforming FICO Score Trigger Event" means, with respect to Conforming
Loans, that (A)(i) the Conforming Pool Weighted Average FICO Score has been
reported, in a Collateral Agent Daily Report, as less than 675 but more than
650, (ii) a period of ten (10) days has elapsed from the date of receipt of such
report by the Administrative Agent and (iii) the Servicer has not provided to
the Administrative Agent a revised Conforming Pool Weighted Average FICO Score
that is at least 675 or (B)(i) the Conforming Pool Weighted Average FICO Score
has been reported, in a Collateral Agent Daily Report, as less than 650, (ii) a
period of five (5) days has elapsed from the date of receipt of such report by
the Administrative Agent and (iii) the Servicer has not provided to the
Administrative Agent a revised Conforming Pool Weighted Average FICO Score that
is at least 675.
"Conforming Loan" means (i) a Mortgage Loan that complies with all
applicable requirements for purchase under a ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ Mac or other
similar Governmental Authority standard form of conventional mortgage loan
purchase contract, then in effect, or (ii) an FHA Loan or a VA Loan.
"Conforming Loan-to-Value Ratio Trigger Event" means, with respect to
Conforming Loans, that (A)(i) the weighted average Loan-to-Value Ratio has been
reported, in a Collateral Agent Daily Report, as greater than 83% but equal to
or less than 90%, (ii) a period of ten (10) days has elapsed from the date of
receipt of such report by the Administrative Agent and (iii) the Servicer has
not provided to the Administrative Agent a revised weighted average
Loan-to-Value Ratio that is equal to or less than 83% or (B)(i) the weighted
average Loan-to-Value Ratio has been reported, in a Collateral Agent Daily
Report, as greater than 90%, (ii) a period of five (5) days has elapsed from the
date of receipt of such report by the Administrative Agent and (iii) the
Servicer has not provided to the Administrative Agent a revised weighted average
Loan-to-Value Ratio that is equal to or less than 83%.
"Conforming Pool Weighted Average FICO Score" means the ratio of (a)
the sum, for all Conforming Loans, of the product for each Conforming Loan of
(i) its FICO Score and (ii) its
D1-7
original principal balance to (b) the sum of the original principal balances of
all Conforming Loans.
"Corporate Trust Office" shall mean the principal office of the
Collateral Agent at which at any particular time its corporate trust business
shall be administered which office at the date of the execution of the
Collateral Agency Agreement is located at ▇▇▇▇ ▇▇▇▇ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust and Agency Services or at any other
time at such other address as the Collateral Agent may designate from time to
time by written notice to the parties thereto.
"Default" means any condition or event which, with the giving of notice
or lapse of time or both and unless cured or waived, would constitute an Event
of Default.
"Delinquent Mortgage Loan" means a Mortgage Asset under which the
Obligor is 30 or more days in payment default or the Obligor has taken any
action, or suffered any event of the type described in Section 8.1(f), (g) or
(h) of the Loan Agreement, or is in foreclosure.
"Delinquent Ratio" means as of the end of any Collection Period, the
ratio of (i) the principal amount of all Mortgage Loans that were Delinquent
Mortgage Loans at such time, to (ii) the aggregate principal amount of all
Mortgage Loans at such time.
"Disbursement Account" means the account established by the Borrower
with the Deutsche Bank National Trust Company or another Eligible Institution
acceptable to the Administrative Agent, it being understood that such account is
controlled by the Administrative Agent pursuant to the Disbursement Account
Control Agreement, and the Administrative Agent has the authority to direct the
transfer of all funds from the Disbursement Account.
"Disbursement Account Control Agreement" means the Amended and Restated
Disbursement Account Control Agreement, dated as of even date herewith, between
the Borrower, the Servicer, the Administrative Agent and Deutsche Bank National
Trust Company, substantially in the form attached hereto as Exhibit D-13, as
amended, modified, supplemented or replaced from time to time.
"Eligible Assignee" means (i) Calyon or any of its Affiliates, Lloyds
or any of its Affiliates, ABN AMRO or any of its Affiliates, SG or any of its
Affiliates or JPMorgan or any of its Affiliates, (ii) any Person managed by
Calyon or any of its Affiliates, Lloyds or any of its Affiliates, ABN AMRO or
any of its Affiliates, SG or any of its Affiliates or JPMorgan or any of its
Affiliates, or (iii) any financial or other institution that is acceptable to
the Managing Agent related to the Lender that is making the assignment and,
unless an Event of Default has occurred or is continuing, the Borrower (which
consent shall not be unreasonably withheld).
"Eligible Investments" means any one or more of the following
obligations or securities having the required ratings, if any, provided for in
this definition and which shall not be subject to liquidation prior to maturity:
(i) direct obligations of, and obligations fully
guaranteed as to timely payment of principal and interest by, the United States
of America, ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ Mac or any agency or instrumentality of the
United States of America, the obligations of which are
D1-8
backed by the full faith and credit of the United States of America; provided
that any obligation of, or guarantee by, ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, other than
an unsecured senior debt obligation of ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, shall be an
Eligible Investment only if such investment would not result in the downgrading,
withdrawal or qualification of the then-current rating assigned by each rating
agency to any certificate as evidenced in writing;
(ii) time deposits, unsecured certificates of deposit, or
bankers' acceptances that mature in after the date of issuance and are issued or
held by any depository institution or trust company (including the Collateral
Agent) incorporated or organized under the laws of the United States of America
or any State thereof and subject to supervision and examination by federal or
state banking authorities, so long as the commercial paper or other short-term
debt obligations of such depository institution or trust company are rated in
the highest rating categories of each of Moody's and Fitch, as applicable, or
such other rating as would not result in the downgrading, withdrawal or
qualification of the then-current rating assigned by each rating agency, as
evidenced in writing; provided that Servcier shall direct investment only into
instrument or
(iii) repurchase agreements or obligations with respect to
any security described in clause (i) above where such security has a remaining
maturity of one year or less and where such repurchase obligation has been
entered into with a depository institution or trust company (acting as
principal) described in clause (ii) above;
(iv) debt obligations 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, which debt obligations are rated in the
highest rating categories of each of Moody's and Fitch, as applicable; provided,
however, that securities issued by any particular corporation will not be
Eligible Investments to the extent that investment therein will cause the
then-outstanding principal amount of securities issued by such corporation and
held in the accounts established hereunder to exceed 10% of the sum of the
aggregate principal balance and the aggregate principal amount of all Eligible
Investments in such accounts;
(v) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations) of any corporation or
other entity organized under the laws of the United States or any state thereof
payable on demand or on a specified date and which is rated in the highest
rating category of each of Moody's and Fitch;
(vi) money market funds, rated in the highest rating
categories of each of Moody's and Fitch;
provided, however, that in each case if the investment is rated by Fitch, (a) it
shall have a predetermined fixed dollar of principal due at maturity that cannot
vary or change and (b) any such investment that provides for a variable rate of
interest must have an interest rate that is tied to a single interest rate index
plus a fixed spread, if any, and move proportionately with such index; and
provided, further, however, that the Servicer shall not request or direct any
investment in such instrument (x) if such instrument evidences principal and
interest payments derived from obligations underlying such instrument and the
interest payments with respect to such instrument provide a yield to maturity at
the time of acquisition of greater than 120% of the yield to maturity
D1-9
at par of such underlying obligations or (y) if such instrument may be redeemed
at a price below the purchase price. The Servicer shall not request or direct
any investments that are subject to prepayment or call to be purchased at a
price in excess of par.
"Eligible Mortgage Collateral" means Eligible Mortgage Loans and the
Collection Account.
"Eligible Mortgage Loan" means a Mortgage Loan:
(a) that (i) is a closed and fully funded Mortgage Loan, (ii)
has a maximum term to maturity of 30 years and the proceeds of which
were used either to finance a portion of the purchase price of a
Property encumbered by the related Mortgage or to refinance a loan
secured by such Property, (iii) is secured by a perfected
first-priority Lien on residential real Property consisting of land and
a one-to-four family dwelling thereon which is completed and ready for
owner occupancy, including townhouses and condominiums, and (iv) was
underwritten according to the applicable Originator's Underwriting
Guidelines and was originated or purchased by one of the Originators;
(b) that is a Conforming Loan, a Jumbo Loan or an Alt-A Loan;
(c) in which the Administrative Agent has been granted and
continues to hold a perfected (other than actual delivery of the
Mortgage Note to the Collateral Agent for Wet Borrowings),
first-priority, security interest for the benefit of the holders of the
Obligations;
(d) for which the Mortgage Note is payable to or endorsed
(without recourse) in blank and each of such Mortgage Loan and the
related Mortgage Note is a legal, valid and binding obligation of the
Obligor thereof;
(e) for which, other than in respect of Wet Loans, the
Principal Mortgage Documents have been received by the Collateral Agent
and are in form conforming to the review criteria referenced in Section
3.8;
(f) that, upon pledge thereof under this Agreement and
application of any related Advance to pay off any prior lienholder as
required by the Loan Agreement and hereunder, together with the related
Mortgage Loan Collateral, is owned beneficially by the Borrower free
and clear of any Lien of any other Person other than the Administrative
Agent for the benefit of the holders of the Obligations;
(g) that, together with the related Mortgage Loan Collateral,
does not contravene any Governmental Requirements applicable thereto
(including, without limitation, the Real Estate Settlement Procedures
Act of 1974, as amended, and all laws, rules and regulations relating
to usury, truth-in-lending, fair credit billing, fair credit reporting,
equal credit opportunity, fair debt collection practices, privacy and
other applicable federal and state consumer protection laws) and with
respect to which no party to the related Mortgage Loan Collateral is in
violation of any Governmental Requirements (or procedure prescribed
thereby) if such violation would impair the
D1-10
collectability of such Mortgage Loan or the saleability of such
Mortgage Loan under the applicable Take-Out Commitment or Hedge;
(h) that: (i) is not a Delinquent Mortgage Loan at the time it
is transferred to the Borrower pursuant to the Repurchase Agreement;
(ii) has not previously been sold to an Approved Take-Out Investor or
any of the Originators and repurchased by Borrower; (iii) if, it was a
Wet Loan when it was assigned to the Borrower and the time periods set
forth in Section 3.7(b) of this Agreement have occurred, the Principal
Mortgage Documents relating to such Wet Loan were delivered to the
Collateral Agent; provided, however, that upon delivery of such
Principal Mortgage Documents to the Collateral Agent, such Mortgage
Loans shall subsequently conform to the review criteria of Section 3.8
subsequent to such delivery; (iv) has a Loan-to-Value Ratio in excess
of 100%; and (v) does not have an original principal balance in excess
of $2,500,000;
(i) that if the Mortgage Loan Collateral has been withdrawn
for correction pursuant to Section 3.5 of this Agreement such Mortgage
Loan Collateral has been returned to the Collateral Agent within 20
calendar days after withdrawal as required by Section 3.5 of this
Agreement;
(j) that is denominated and payable in U.S. dollars in the
United States and the Obligor of which is a natural person who is a
U.S. citizen or resident alien or a corporation or an inter vivos
revocable trust or other legal entity organized under the laws of the
United States or any State thereof or the District of Columbia;
(k) that is not subject to any right of rescission, setoff,
counterclaim or other dispute whatsoever;
(l) that was acquired by the Borrower from any of the
Originators within 60 days after its Mortgage Origination Date;
(m) that is covered by the types and amounts of insurance
required by Section 6.6(b) of the Loan Agreement;
(n) with respect to which all representations and warranties
made by the related Originator in the Repurchase Agreement are true and
correct in all material respects and with respect to which all loan
level covenants made in the Repurchase Agreement have been complied
with; and
(o) that is subjected to the following "Quality Control"
measures by personnel of any of the Originators before the Mortgage
Note is funded by such Originator:
(i) for those Mortgage Loans not originated by the
Originator, is subject to being selected at random for a review for
thoroughness and compliance (including truth-in-lending, good faith
estimates and other disclosures); and
(ii) with respect to which, all Mortgage Loan
Collateral is prepared by any of the Originators and submitted to the
closing agent at the time of funding the related Mortgage Loans.
D1-11
"Event of Default" means an Event of Default as defined in Section 8.1
of the Loan Agreement.
"Exceptions" means exceptions to the specifications and certifications
made by the Collateral Agent on the Collateral Agent Daily Report as set forth
on Schedule I hereto.
"▇▇▇▇▇▇ ▇▇▇" means the government sponsored enterprise formerly known
as the Federal National Mortgage Association, or any successor thereto.
"FHA" means the Federal Housing Administration, or any successor
thereto.
"FHA Loan" means a Mortgage Loan, the ultimate payment of which is
partially or completely insured by the FHA or with respect to which there is a
current, binding and enforceable commitment for such insurance issued by the
FHA.
"FICO Score" means, with respect to the Obligor under a particular
Mortgage Loan, a credit rating established by Fair ▇▇▇▇▇ Corporation.
"Fitch" means Fitch, Inc., and any successor thereto.
"▇▇▇▇▇▇▇ Mac" means the Federal Home Loan Mortgage Corporation, or any
successor thereto.
"▇▇▇▇▇▇ Mae" means the Government National Mortgage Association, or any
successor thereto.
"Governmental Authority" means any nation or government, any agency,
department, state or other political subdivision thereof, or any instrumentality
thereof, and any entity exercising executive, legislative, judicial, regulatory
or administrative functions of or pertaining to government. Governmental
Authority shall include, without limitation, each of ▇▇▇▇▇▇▇ Mac, ▇▇▇▇▇▇ ▇▇▇,
FHA, HUD, VA and ▇▇▇▇▇▇ Mae.
"Governmental Requirement" means any law, statute, code, ordinance,
order, rule, regulation, judgment, decree, injunction, franchise, permit,
certificate, license, authorization or other requirement (including, without
limitation, any of the foregoing which relate to energy regulations and
occupational, safety and health standards or controls and any hazardous
materials laws) of any Governmental Authority that has jurisdiction over any of
the Originators, the Servicer, the Collateral Agent or the Borrower or any of
their respective Properties.
"Hedge" means a current, valid, binding, enforceable, written
commitment, including without limitation a forward purchase commitment, issued
by an Approved Hedge Counterparty, to purchase mortgage loans from one of the
Originators from time to time at a specified price (or a specified spread to an
agreed-upon index), which commitment is not subject to any term or condition (i)
that is not customary in commitments of like nature or (ii) that, in the
reasonably anticipated course of events, cannot be fully complied with prior to
the expiration thereof, in which a perfected security interest has been granted
to the Administrative Agent.
D1-12
"Hedge Report" means, a report prepared by the Servicer pursuant to
Section 3.6 of the Loan Agreement, showing, as of the close of business on the
last Business Day of each week, all Take-Out Commitments or ▇▇▇▇▇▇ obtained by
the Originators to cover all closed loans owned by the Originators or the
Borrower, to the extent that such mortgage loans have been pledged hereunder or
pursuant to another lending arrangement, and certain information with respect to
such trades including information as the Administrative Agent may request, in
the form of Exhibit K of the Loan Agreement. Each such Take-Out Commitment or
Hedge shall have been pledged to the Administrative Agent; provided, however,
that any ▇▇▇▇▇▇ may have been pledged previously or may be pledged in the future
by the Originators on a pari passu basis.
"HUD" means the Department of Housing and Urban Development, or any
successor thereto.
"Indemnified Amounts" is defined in Section 5.1.
"Indemnified Party" is defined in Section 5.1.
"Issuer" means La Fayette, Amsterdam, ▇▇▇▇▇▇ and Park Avenue and their
respective successors and assigns.
"JPMorgan" means JPMorgan Chase Bank, as a Bank and as a Managing
Agent.
"Jumbo Loan" means a Mortgage Loan (other than a Conforming Loan) that
(1) is underwritten by an Approved (other than ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇
Mae), (2) matches all applicable requirements for purchase under the
requirements of a Take-Out Commitment issued for the purchase of such Mortgage
Loan, and (3) differs from a Conforming Loan solely because the principal amount
of such Mortgage Loan exceeds the limit set for Conforming Loans by ▇▇▇▇▇▇ ▇▇▇
or ▇▇▇▇▇▇▇ Mac from time to time. The term Jumbo Loans includes Super Jumbo
Loans.
"La Fayette" means La Fayette Asset Securitization LLC, a Delaware
limited liability company, together with its successors and assigns.
"Lenders" means, collectively, the Issuer and the Banks.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (whether statutory, consensual or otherwise), or
other security arrangement of any kind (including, without limitation, any
conditional sale or other title retention agreement, any financing lease having
substantially the same economic effect as any of the foregoing, and the filing
of any financing statement under the uniform commercial code or comparable law
of any jurisdiction in respect of any of the foregoing).
"Loan Agreement" is defined in the preamble to this Agreement.
"Loan to Value Ratio" means, with respect to any Mortgage Loan, the
fraction, expressed as a percentage found by dividing the original principal
balance of a Mortgage Loan by the value of the related mortgaged property, such
value being measured by (i) the appraised value of such property at such time,
if the Mortgage Loan is a refinance of any existing lien or (ii) the lower of
D1-13
the sales price of the related property at the time of origination of the
Mortgage Loan or the appraised value of such property at such time, if the
Mortgage Loan is a purchase money loan.
"Majority Banks" means, at any time, Banks, including Banks that have
become party to the Loan Agreement pursuant to an Assignment and Acceptance,
having outstanding Advances equal to more than 50% of the aggregate outstanding
Advances held by Banks or, if no Advance is then outstanding from any Bank,
Banks having more than 50% of the Bank Commitments.
"Managing Agent" means, (a) with respect to La Fayette, Calyon or any
successor managing agent designated by such party; (b) with respect to
Amsterdam, ABN AMRO or any successor managing agent designated by such party;
(c) with respect to Park Avenue, JPMorgan or any successor managing agent
designated by such party; and (d) with respect to ▇▇▇▇▇▇, ▇▇ or any successor
managing agent designated by such party.
"Market Value" means at the time determined, for any Mortgage Loan (a)
the market value of such Mortgage Loan determined by the Servicer based upon the
then most recent posted net yield for 30-day mandatory future delivery furnished
by ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ Mac, ▇▇▇▇▇▇ ▇▇▇ or another entity deemed most appropriate
by the Servicer and published and distributed by Telerate Mortgage Services, or,
if such posted net yield is not available from Telerate Mortgage Services, such
posted net yield obtained directly from ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, ▇▇▇▇▇▇ ▇▇▇ or
another entity deemed most appropriate by the Servicer, or (b) if an appropriate
posted rate is not available, the value determined by the Servicer in good
faith, using commercially reasonable efforts, which efforts shall include
consulting with two or more entities that make a market in similar mortgage
loans, to determine such Market Value. Notwithstanding the foregoing, within
three (3) Business Days of the date upon which a Market Value determination is
provided, any Lender may dispute the Servicer's determination of Market Value in
writing to the Servicer and each of the Managing Agents. Upon receipt of such a
notice, the Servicer and the Managing Agents shall make a good faith effort to
resolve the discrepancy. If the discrepancy is not resolved within seven (7)
days in a manner satisfactory to each of the Managing Agents (an "Unresolved
Dispute"), then the Administrative Agent shall obtain a different market
valuation (an "Additional Determination"). At any time the Administrative Agent
may, and upon an Unresolved Dispute, shall, obtain an Additional Determination.
If the Administrative Agent shall have obtained an Additional Determination as
of any determination date (which Additional Determination may be from the
Administrative Agent or any Affiliate thereof) and the amount of the Additional
Determination as of such determination date is more than 0.50% less than the
amount of the aggregate Market Values determined by the Servicer on such
determination date, then, the amount of the Additional Determination shall be
used as the Market Value for purposes of clause (A)(2) and (A)(3) of the
definition of "Collateral Value." The Borrower shall be solely responsible for
the costs incurred with respect to such Additional Determinations. The
Administrative Agent shall notify the Servicer of the variance between the
Servicer's determination of the Market Value and the Additional Determinations
and the source(s) used by the Administrative Agent to determine the Additional
Determinations. Following such notice and prior to the next determination date,
either (i) the Servicer and the Administrative Agent will determine a mutually
acceptable, reasonable, alternative valuation for the Market Value of such
Mortgage Loan or (ii) the Servicer shall use an amount equal to the Additional
Determination as the Market Value of such Mortgage Loan for subsequent
determination dates until clause (i) is satisfied in good faith.
D1-14
"Maximum Facility Amount" means $1,150,000,000, as such amount may be
reduced pursuant to Section 2.1(c) of the Loan Agreement.
"MERS" means Mortgage Electronic Registration Systems, Inc., a Delaware
corporation.
"MERS Designated Mortgage Loan" means a Mortgage Loan registered to or
by the related Originator on the MERS electronic mortgage registration system.
"Monthly Payment Status Report" is defined in Section 3.2(h).
"Mortgage" means a mortgage or deed of trust or other security
instrument creating a Lien on real property, on a standard form as approved by
▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇ Mae or such other form as any of the
Originators determines is satisfactory for any Approved Take-Out Investor unless
otherwise directed by the Administrative Agent and communicated to the
Collateral Agent.
"Mortgage Assets" means, collectively:
(a) any and all Mortgage Loans in which the Administrative Agent, as
secured party, for the benefit of the holders of the Obligations, is granted a
security interest pursuant to any Assignment or other document (whether or not
the Principal Mortgage Documents related thereto are delivered) heretofore or
hereafter from time to time executed by the Borrower;
(b) any and all instruments, documents and other property of every kind
or description, of or in the name of the Borrower, now or hereafter for any
reason or purpose whatsoever, in the possession or control of, or in transit to,
the Collateral Agent;
(c) any and all general intangibles and Mortgage Loan Collateral that
relate in any way to the Mortgage Assets;
(d) any and all Take-Out Commitments and ▇▇▇▇▇▇ identified on Hedge and
Commitment Reports from time to time prepared by the Servicer on behalf of any
of the Originators and the Borrower;
(e) any and all contract rights, chattel paper, certificated
securities, uncertificated securities, financial assets, securities accounts or
investment property which constitute proceeds of the Mortgage Assets;
(f) this Agreement, the Performance Guaranties and the Subordination
Agreement, including all moneys due or to become due thereunder, claims of the
Borrower arising out of or for breach or default thereunder, and the right of
the Borrower to compel performance and otherwise exercise all remedies
thereunder; and
(g) any Advanced Funds; and
(h) any and all proceeds of any of the foregoing, including all
Collections.
D1-15
"Mortgage Loan" means a loan evidenced by a Mortgage Note and secured
by a Mortgage, the beneficial interest of which has been acquired by the
Borrower from the Originator by purchase pursuant to the Repurchase Agreement
(with the record owner thereof being such Originator or, in the case of a MERS
Designated Mortgage Loan, MERS as nominee for its successors and assigns).
"Mortgage Loan Collateral" means all Mortgage Notes and related
Principal Mortgage Documents, Other Mortgage Documents, and other Collateral.
"Mortgage Note" means a promissory note, on a standard form approved by
▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇ Mae or such other form as the Originators
determine is satisfactory for any Approved Take-Out Investor unless otherwise
directed by the Administrative Agent and communicated to the Collateral Agent.
"Mortgage Origination Date" means, with respect to each Mortgage Loan,
the date (transmitted by the Servicer to the Collateral Agent) that is the later
of (1) the date of the Mortgage Note or (2) the date such Mortgage Loan was
funded and disbursed to or at the direction of the Obligor.
"Non-Conforming FICO Score Trigger Event" means, with respect to
Non-Conforming Loans, that (A)(i) the Non-Conforming Pool Weighted Average FICO
Score has been reported, in a Collateral Agent Daily Report, as less than 675
but equal to or more than 650, (ii) a period of ten (10) days has elapsed from
the date of receipt of such report by the Administrative Agent and (iii) the
Servicer has not provided to the Administrative Agent a revised Non-Conforming
Pool Weighted Average FICO Score that is at least 675 or (B)(i) the
Non-Conforming Pool Weighted Average FICO Score has been reported, in a
Collateral Agent Daily Report, as less than 650, (ii) a period of five (5) days
has elapsed from the date of receipt of such report by the Administrative Agent
and (iii) the Servicer has not provided to the Administrative Agent a revised
Non-Conforming Pool Weighted Average FICO Score that is at least 675.
"Non-Conforming Loan" means a Jumbo Loan or an Alt-A Loan.
"Non-Conforming Loan-to-Value Ratio Trigger Event" means, with respect
to Non-Conforming Loans, that (A)(i) the weighted average Loan-to-Value Ratio
has been reported, in a Collateral Agent Daily Report, as greater than 83% but
equal to or less than 90%, (ii) a period of ten (10) days has elapsed from the
date of receipt of such report by the Administrative Agent and (iii) the
Servicer has not provided to the Administrative Agent a revised weighted average
Loan-to-Value Ratio that is equal to or less than 83% or (B)(i) the weighted
average Loan-to-Value Ratio has been reported, in a Collateral Agent Daily
Report, as greater than 90%, (ii) a period of five (5) days has elapsed from the
date of receipt of such report by the Administrative Agent and (iii) the
Servicer has not provided to the Administrative Agent a revised weighted average
Loan-to-Value Ratio that is equal to or less than 83%.
"Non-Conforming Pool Weighted Average FICO Score" means the ratio of
(a) the sum, for all Non-Conforming Loans, of the product for each
Non-Conforming Loan of (i) its FICO Score and (ii) its original principal
balance to (b) the sum of the original principal balances of all Non-Conforming
Loans.
D1-16
"Obligations" means any and all present and future indebtedness,
obligations, and liabilities of the Borrower to any of the Lenders, the
Collateral Agent, each Managing Agent, each Affected Party, each Indemnified
Party and the Administrative Agent, and all renewals, rearrangements and
extensions thereof, or any part thereof, arising pursuant to the Loan Agreement
or any other Transaction Document, and all interest accrued thereon, and
attorneys' fees and other costs incurred in the drafting, negotiation,
enforcement or collection thereof, regardless of whether such indebtedness,
obligations, and liabilities are direct, indirect, fixed, contingent, joint,
several or joint and several.
"Obligor" means (i) with respect to each Mortgage Note included in the
Collateral, the obligor on such Mortgage Note and (ii) with respect to any other
agreement included in the Collateral, any person from whom any of the
Originators or the Borrower is entitled to performance.
"Originators" means together, American Home Mortgage Corp., a New York
corporation and American Home Mortgage Servicing, Inc., a Maryland corporation,
and their respective successors and assigns.
"Other Mortgage Documents" is defined in Section 3.2(c).
"Park Avenue" has the meaning ascribed to it in the Loan Agreement.
"Performance Guarantors" means together, American Home Mortgage
Holdings, Inc., a Delaware corporation, and AHMIC, and their respective
successors and assigns.
"Performance Guaranty" means, collectively, the Servicer Performance
Guaranty, and the Originator Performance Guaranty, each as defined in the Loan
Agreement.
"Permitted Transferees" is defined in Section 3.4(c).
"Person" means any individual, corporation (including a business
trust), limited liability company, partnership, joint venture, association,
joint stock company, trust, unincorporated organization, Governmental Authority,
or any other form of entity.
"Principal Debt" means, at the time determined, the unpaid principal
balance of all Advances under the Loan Agreement.
"Principal Mortgage Documents" is defined in Section 3.2(b).
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Repurchase Agreement" means the Amended and Restated Master Repurchase
Agreement and Addendum to the Master Repurchase Agreement incorporated therein,
each dated as of the date of this Agreement between the Originators, as sellers,
and the Borrower, as purchaser, as the same may be amended, modified or restated
from time to time.
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"Reserve Account Control Agreement" means the Reserve Account Control
Agreement, dated as of even date herewith, between the Borrower, the Servicer,
the Administrative Agent and Deutsche Bank Trust Company Americas, substantially
in the form attached to the Loan Agreement as Exhibit N, as amended, modified,
supplemented or replaced from time to time.
"Responsible Officer" shall mean when used with respect to the
Collateral Agent any officer within the Corporate Trust Office including any
Vice President, Managing Director, Director, Assistant Vice President, Associate
or any other officer of the Collateral Agent customarily performing functions
similar to those performed by any of the above designated officers and also,
with respect to a particular matter, any other officer to whom such matter is
referred because of such officer's knowledge and familiarity with the particular
subject.
"Security Agreement" means the Security Agreement dated as of even date
herewith, among the Borrower, the Collateral Agent and the Administrative Agent
in the form attached hereto as Exhibit D-2, as amended, modified or
supplemented.
"Security Instruments" means (a) this Agreement, (b) the Security
Agreement, (c) the Collection Account Control Agreement, (d) the Reserve Account
Control Agreement (e) Disbursement Account Control Agreement, and (f) such other
executed documents as are or may be necessary to grant to the Administrative
Agent a perfected first, prior and continuing security interest in and to the
Collateral and any and all other agreements or instruments now or hereafter
executed and delivered by or on behalf of the Borrower in connection with, or as
security for the payment or performance of, all or any of the Obligations, as
amended, modified or supplemented.
"Servicer" means at any time the Person then authorized pursuant to
Section 11.1 of the Loan Agreement to administer and collect Mortgage Loans on
behalf of the Lenders. The initial Servicer shall be American Home Mortgage
Servicing, Inc.
"Shipping Request" means the shipping request presented by the Borrower
or the Servicer to the Collateral Agent substantially in the form attached as
Exhibits D-5A (as amended, modified or supplemented from time to time as agreed
to by the Administrative Agent, the Managing Agents the Borrower and the
Collateral Agent).
"Subordination Agreement" means the amended and restated subordination
agreement, dated as of the date hereof, substantially in the form attached as
Exhibit B to the Loan Agreement, executed by Performance Guarantors and certain
of their respective Affiliates, if applicable, in favor of the Borrower and the
Administrative Agent for the benefit of the holders of the Obligations.
"Subsidiary" means, with respect to any Person, any corporation or
other entity of which securities having ordinary voting power to elect a
majority of the board of directors or other persons performing similar functions
are at the time directly or indirectly owned by such Person, or one or more of
its Subsidiaries, or by such Person and one or more of its Subsidiaries.
"Super Jumbo Loan" means a Jumbo Loan having an original principal
balance in excess of $999,999 but not more than $2,500,000.
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"Take-Out Commitment" means a current, valid, binding, enforceable,
written commitment, issued by an Approved Take-Out Investor to purchase mortgage
loans from one of the Originators from time to time at a specified price (or a
specified spread to an agreed-upon index) which commitment is not subject to any
term or condition (i) that is not customary in commitments of like nature or
(ii) that, in the reasonably anticipated course of events, cannot be fully
complied with prior to the expiration thereof, in which a perfected and
first-priority security interest has been granted to the Administrative Agent.
"Take-Out Commitment Documents" means (1) with respect to any Mortgage
Loan, with respect to which there is no loan-specific Take-Out Commitment, an
executed original assignment of trade as described in the definition of
"Take-Out Commitment"; and (2) with respect to any Mortgage Loan, with respect
to which there is a loan-specific Take-Out Commitment, copies of all Take-Out
Commitments.
"Take-Out Commitment Master Agreement" means with respect to which
there is a loan-specific Take-Out Commitment, the master flow sale agreement,
investor bulk sales agreement, or similar agreement setting forth the basic
terms of sales to the related Approved Take-Out Investor.
"Termination Date" means the earliest to occur of (a) November 21,
2006, unless such date shall be extended pursuant to Section 2.1(b) of the Loan
Agreement, then the date specified in such Extension Request, (b) the date on
which the Maximum Facility Amount is terminated by the Borrower pursuant to
Section 2.1(d) of the Loan Agreement, and (c) the date, on or after the
occurrence of an Event of Default, determined pursuant to Section 8.2 of the
Loan Agreement.
"Transaction Document" means any of the Loan Agreement, the Notes (as
defined in the Loan Agreement), this Agreement, the Security Instruments, the
Repurchase Agreement, the Amended and Restated Administrative Agent Fee Letter
(as defined in the Loan Agreement), the Manager's Agents Fee Letter (as defined
in the Loan Agreement) the Subordination Agreement, any Performance Guaranty and
any and all other agreements or instruments now or hereafter executed and
delivered by or on behalf of the Borrower in connection with, or as security for
the payment or performance of any or all of the Obligations, as any of such
documents may be renewed, amended, restated or supplemented from time to time.
"Transfer Request" is defined in Section 3.4(a).
"Trust Receipt and Security Agreement Letter" is defined in Section
3.5.
"UCC" means the Uniform Commercial Code as adopted in the applicable
state, as the same may hereafter be amended.
"Underwriting Guidelines" means, with respect to each Originator, the
Originator's Underwriting Guidelines, a copy of which has been provided to the
Administrative Agent.
"VA" means the Department of Veterans Affairs, or any successor
thereto.
"VA Loan" means a Mortgage Loan, the payment of which is partially or
completely guaranteed by the VA under the Servicemen's Readjustment Act of 1944,
as amended, or
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Chapter 37 of Title 38 of the United States Code or with respect to which there
is a current binding and enforceable commitment for such a guaranty issued by
the VA.
"Wet Borrowing" is defined in Section 3.7.
"Wet Loans" means the Mortgage Loans pursuant to an Assignment in which
the Borrower shall grant to the Administrative Agent for the benefit of the
holders of the Obligations, from the Borrowing Date of each Wet Borrowing, a
perfected, first-priority security interest in the Mortgage Loans identified in
Schedule III to said Assignment.
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