1
EXHIBIT 4.2
2
EXECUTION COPY
--------------------------------------------------------------------------------
MASTER LOAN TRANSFER AGREEMENT
Dated as of June 15, 1997
by and among
ADVANTA MORTGAGE CORP. USA
ADVANTA MORTGAGE CORP. MIDATLANTIC
ADVANTA MORTGAGE CORP. MIDATLANTIC II
ADVANTA MORTGAGE CORP. MIDWEST
ADVANTA MORTGAGE CORP. OF NEW JERSEY
ADVANTA MORTGAGE CORP. NORTHEAST
ADVANTA NATIONAL BANK USA
ADVANTA MORTGAGE CONDUIT SERVICES, INC.
ADVANTA FINANCE CORP.,
ADVANTA CONDUIT RECEIVABLES, INC.
as Affiliated Originators,
BANKERS TRUST COMPANY OF CALIFORNIA, N.A.,
as Trustee
and
ADVANTA MORTGAGE CONDUIT SERVICES, INC.,
as Sponsor
--------------------------------------------------------------------------------
3
TABLE OF CONTENTS
Page
----
Section 1. Definitions................................................................. 1
Section 2. Interest Calculations....................................................... 4
Section 3. Transfers of Mortgage Loans................................................. 4
Section 4. Representations, Warranties and
Covenants Regarding the Affiliated
Originators and the Sponsor................................................. 4
Section 5. Representations and Warranties of the
Affiliated Originators Regarding the
Mortgage Loans.............................................................. 9
Section 6. Authorized Representatives.................................................. 16
Section 7. Notices..................................................................... 16
Section 8. Governing Law............................................................... 17
Section 9. Assignment.................................................................. 17
Section 10. Counterparts................................................................ 17
Section 11. Amendment................................................................... 17
Section 12. Severability of Provisions.................................................. 17
Section 13. No Agency; No Partnership or Joint
Venture..................................................................... 18
Section 14. Further Assurances.......................................................... 18
Section 15. The Certificate Insurer..................................................... 18
Section 16. Maintenance of Records...................................................... 18
i
4
THIS MASTER LOAN TRANSFER AGREEMENT, dated as of June 15, 1997,
between Advanta Mortgage Corp. USA, Advanta Mortgage Corp. Midatlantic, Advanta
Mortgage Corp. Midatlantic II, Advanta Mortgage Corp. Midwest, Advanta Mortgage
Corp. of New Jersey, Advanta Mortgage Corp. Northeast, Advanta Mortgage Conduit
Services, Inc., Advanta Finance Corp., Advanta National Bank USA and Advanta
Conduit Receivables, Inc. each a seller (each an "Affiliated Originator" and
collectively, the "Affiliated Originators"), Bankers Trust Company of
California, N.A., as trustee ("Trustee") and Advanta Mortgage Conduit Services,
Inc., as sponsor ("Sponsor");
I. BACKGROUND
A. Each Affiliated Originator is an originator or purchaser of mortgage
loans which such Affiliated Originator may, from time to time, convey
to the Conduit Acquisition Trust, or cause the Conduit Acquisition
Trust to acquire;
B. The Affiliated Originators and the Sponsor expect, from time to time,
to cause that such mortgage loans to be conveyed to an Advanta Trust
in connection with a securitization transaction sponsored by the
Sponsor.
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements herein contained, the parties hereto hereby agree as follows:
Section 1. Definitions. Whenever used in this Agreement or in any
Conveyance Agreement, the following words and phrases, unless the context
otherwise requires, shall have the meanings specified in this Article; provided,
however, that any capitalized terms used herein or in any conveyance Agreement
and not defined herein shall have their respective meanings as set forth in the
related Advanta Pooling Agreement.
Advanta Pooling Agreement: Any Pooling and Servicing Agreement entered
into by Advanta Mortgage Conduit Services, Inc. as Sponsor, Advanta Mortgage
Corp. USA, as Master Servicer and a trustee, as it may be amended and
supplemented from time to time by the parties thereto.
Advanta Trust: A securitization trust created by the Sponsor into
which Mortgage Loans described in this Agreement and the Conveyance Agreements
are deposited.
Agreement: This Master Loan Transfer Agreement as it may be amended
from time to time, including the exhibits and supplements hereto.
Bulk Acquisition Loan: Any Mortgage Loan purchased by an Affiliated
Originator from another Originator (other
5
than any other Affiliated Originator) as part of a bulk portfolio acquisition.
Conduit Acquisition P&S: The Pooling and Servicers Agreement dated as
of February 15, 1995 by and between the Sponsor and the Trustee relating to the
Conduit Acquisition Trust.
Conduit Acquisition Trust: The trust created pursuant to the Conduit
Acquisition P&S.
Conveyance Agreement: Any Conveyance Agreement relating to a Pool, in
substantially the form set forth as Exhibit A hereto.
Coupon Rate: The rate of interest borne by each Note.
Cut-Off Date: With respect to any Pool, as defined in the related
Conveyance Agreement.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created pursuant to the Emergency Home
Finance Act of 1970, as amended, or any successor thereof.
File: The documents delivered to the Trustee pursuant to the document
delivery provisions of the Conduit Acquisition P&S pertaining to a particular
Mortgage Loan, together with any additional documents required to be added to
the File pursuant to the Conduit Acquisition P&S.
First Mortgage Loan: A Mortgage Loan which constitutes a first
priority mortgage lien with respect to any Property.
FNMA: The Federal National Mortgage Association, a federally-chartered
and privately-owned corporation existing under the Federal National Mortgage
Association Charter Act, as amended, or any successor thereof.
Loan Balance: With respect to each Mortgage Loan, the outstanding
principal balance thereof on the related Cut-Off Date, less any related
Principal Remittance Amounts relating to such Mortgage Loan included in
previous related Monthly Remittance Amounts that were transferred by the Master
Servicer or any Sub-Servicer to the Trustee for deposit in the related
Certificate Account.
2
6
Master Servicer: Advanta Mortgage Corp. USA, a Delaware corporation,
and its permitted successors and assigns.
Mortgage Loans: Each of the mortgage loans subject hereto, together
with any Qualified Replacement Mortgages substituted therefor in accordance with
the related Advanta Pooling Agreement.
Note: The note or other evidence of indebtedness evidencing the
indebtedness of a Mortgagor under a Mortgage Loan.
Offered Certificates: Any securities issued by an Advanta Trust which
are not retained by the Sponsor or any Originator.
Person: Any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
Pool: Any group of Mortgage Loans transferred to the Sponsor pursuant
to a specific Conveyance Agreement.
Property: The underlying property securing a Mortgage Loan.
Qualified Mortgage: "Qualified Mortgage" shall have the meaning set
forth from time to time in the definition thereof at Section 860G(a)(3) of the
Code (or any successor statute thereto) and applicable to the related Advanta
Trust.
Schedules of Mortgage Loans: The Schedules of Mortgage Loans required
to be delivered pursuant to the related Advanta Pooling Agreement.
Second Mortgage Loan: A Mortgage Loan which constitutes a second
priority mortgage lien with respect to the related Property.
Senior Lien: With respect to any Second Mortgage Loan, the mortgage
loan relating to the corresponding Property having a first priority lien; and
with respect to any Third Mortgage Loan, the mortgage loans relating to the
corresponding Property having first and second priority liens.
Third Mortgage Loan: A Mortgage Loan which constitutes a third
priority mortgage lien with respect to the related Property.
Trustee: Bankers Trust Company of California, N.A., located on the
date of execution of this Agreement at ▇ ▇▇▇▇
▇
▇
▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, a national banking association, not in its
individual capacity but solely as Trustee, and any successor hereunder.
Unaffiliated Originator Loan: Any Mortgage Loan purchased by an
Affiliated Originator from an Unaffiliated Originator.
Unaffiliated Originators: Any Originator (x) not affiliated with the
Sponsor and (y) approved in writing by the Certificate Insurer.
Section 2. Interest Calculations. Calculations of interest hereunder,
including, without limitation, calculations of interest at the Coupon Rate,
which are made in respect of the Loan Balance of a Mortgage Loan shall be made
on a daily basis using either (i) a 360-day year comprised of twelve 30-day
months or (ii) a 360-day year and the actual number of days elapsed in the
applicable interest period, as required by the related Note.
Section 3. Transfers of Mortgage Loans. From time to time in
connection with the establishment of Advanta Trusts the Affiliated Originators
and the Sponsor, intend to transfer Mortgage Loans from the Conduit Acquisition
Trust to the related Advanta Trust. Each such transfer will be evidenced by a
Conveyance Agreement in substantially the form of Exhibit A hereto.
Section 4. Representations, Warranties and Covenants Regarding the
Affiliated Originators and the Sponsor. (a) Each Affiliated Originator hereby
represents and warrants to the Sponsor, the Trustee and their respective
successors and assigns that, as of the date hereof;
(i) Such Affiliated Originator is a corporation (or, in the case of
Advanta National Bank USA, a national banking association) duly organized,
validly existing and in good standing under the laws governing its creation
and existence and is in good standing as a foreign corporation in each
jurisdiction in which the nature of its business, or the properties owned
or leased by it make such qualification necessary. Such Affiliated
Originator has all requisite corporate power and authority to own and
operate its properties, to carry out its business as presently conducted
and as proposed to be conducted, to enter into and discharge its
obligations under this Agreement and the Conveyance Agreements.
(ii) The execution and delivery of this Agreement by such Affiliated
Originator and its performance and compliance with the terms of this
Agreement and the Conveyance Agreements to which it is a party have been
4
8
duly authorized by all necessary corporate action on the part of such
Affiliated Originator and will not violate such Affiliated Originator's
Articles of Incorporation, Articles of Association or Bylaws or constitute
a default (or an event which, with notice or lapse of time, or both, would
constitute a default) under, or result in a breach of, any material
contract, agreement or other instrument to which such Affiliated Originator
or its properties is a party or by which such Affiliated Originator is
bound or violate any statute or any order, rule or regulation of any court,
governmental agency or body or other tribunal having jurisdiction over such
Affiliated Originator or any of its properties.
(iii) This Agreement and the Conveyance Agreements to which such
Affiliated Originator is a party, assuming due authorization, execution and
delivery by the other parties hereto and thereto, each constitutes a valid,
legal and binding obligation of such Affiliated Originator, enforceable
against it in accordance with the terms hereof, except as the enforcement
thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors'
rights generally and by general principles of equity (whether considered in
a proceeding or action in equity or at law).
(iv) Such Affiliated Originator is not in default with respect to any
order or decree of any court or any order, regulation or demand of any
federal, state, municipal or governmental agency, which might have
consequences that would materially and adversely affect the condition
(financial or other) or operations of such Affiliated Originator or its
properties, or might have consequences that would materially and adversely
affect its performance hereunder and under the other Conveyance Agreements
to which such Affiliated Originator is a party, or which would draw into
question the validity of this Agreement or the Mortgage Loans taken as a
whole or of any action taken or to be taken in connection with the
obligations of the Affiliated Originator contemplated herein.
(v) No litigation is pending or, to the best of such Affiliated
Originator's knowledge, threatened against such Affiliated Originator which
litigation might have consequences that would prohibit its entering into
this Agreement or any Conveyance Agreements to which it is a party or that
would materially and adversely affect the condition (financial or
otherwise) or operations of such Affiliated Originator or its properties or
might have consequences that would materially and adversely affect its
performance hereunder and under the Conveyance
5
9
Agreements to which such Affiliated Originator is a party.
(vi) Neither this Agreement nor any certificate of an officer,
statement furnished in writing or report delivered pursuant to the terms
hereof by such Affiliated Originator contains any untrue statement of a
material fact or omits to state any material fact necessary to make the
certificate, statement or report not misleading.
(vii) Upon the receipt of each Mortgage Loan and other items of the
Mortgage by the Trustee under this Agreement, the related Advanta Trust
will have good and marketable title to such Mortgage Loan and such other
items of the related Trust Estate free and clear of any lien (other than
liens which will be simultaneously released).
(viii) Neither such Affiliated Originator nor any affiliate thereof
will report on any financial statement any part of the Servicing Fee as an
adjustment to the sales price of the Mortgage Loans.
(ix) All actions, approvals, consents, waivers, exemptions, variances,
franchises, orders, permits, authorizations, rights and licenses required
to be taken, given or obtained, as the case may be, by or from any federal,
state or other governmental authority or agency (other than any such
actions, approvals, etc., under any state securities laws, real estate
syndication or "Blue Sky" statutes, as to which such Affiliated Originator
makes no such representation or warranty), that are necessary or advisable
in connection with the sale of the Mortgage Loans and the execution and
delivery by such Affiliated Originator of this Agreement and the Conveyance
Agreements to which it is a party, have been duly taken, given or obtained,
as the case may be, are in full force and effect on the date hereof, are
not subject to any pending proceedings or appeals (administrative, judicial
or otherwise) and either the time within which any appeal therefrom may be
taken or review thereof may be obtained has expired or no review thereof
may be obtained or appeal therefrom taken, and are adequate to authorize
the consummation of the transactions contemplated by this Agreement and the
conveyance Agreements on the part of such Affiliated Originator and the
performance by such Affiliated Originator of its obligations under this
Agreement and such of the Conveyance Agreements to which it is a party.
(x) The origination practices used by such Affiliated Originator with
respect to the Mortgage Loans originated by such Affiliated Originator have
been, (i)
6
10
in all material respects, legal, proper, prudent and customary in the
mortgage loan lending business and (ii) in compliance with the Servicer's
underwriting criteria as described in the Prospectus.
(xi) The transactions contemplated by this Agreement are in the
ordinary course of business of such Affiliated Originator. The transfer,
assignment and conveyance of the Mortgage Notes and the Mortgages by the
Servicer pursuant to this Agreement are not subject to the bulk transfer
laws or any similar statutory provisions in effect in any applicable
jurisdiction.
(xii) Such Affiliated Originator received fair consideration and
reasonably equivalent value in exchange for the sale of the interests in
the Mortgage Loans.
(xiii) Such Affiliated Originator did not sell any interest in any
Mortgage Loan with any intent to hinder, delay or defraud any of its
respective creditors.
(xiv) Such Affiliated Originator is solvent, and such Affiliated
Originator will not be rendered insolvent as a result of the sale of the
Mortgage Loans to the related Advanta Trust.
The representations and warranties set forth in this paragraph (a) shall survive
the sale and assignment of the Mortgage Loans to the Sponsor.
In addition, each Affiliated Originator hereby covenants to perform
the obligations, if any, imposed upon it by the related Advanta Pooling
Agreement.
(b) The Sponsor hereby represents and warrants to each Affiliated
Originator and the Trustee that, as of the date hereof:
(i) The Sponsor is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware and has all
licenses and qualifications necessary to carry on its business as now being
conducted and to perform its obligations hereunder; the Sponsor has the
power and authority to execute and deliver this Agreement and to perform
its obligations in accordance herewith; the execution, delivery and
performance of this Agreement (including any Conveyance Agreement and any
other instruments of transfer to be delivered pursuant to this Agreement)
by the Sponsor and the consummation of the transactions contemplated hereby
have been duly and validly authorized by all necessary corporate action and
do not violate the organization documents of the Sponsor, contravene or
violate any law,
7
11
regulation, rule, order, judgement or decree to which the Sponsor or its
properties are subject or contravene, violate or result in any breach of
any provision of, or constitute a default under, or result in the
imposition of any lien on any assets of the Sponsor pursuant to the
provisions of, any mortgage, indenture, contract, agreement or other
undertaking to which the Sponsor is a party or which purports to be binding
upon Sponsor or any of Sponsor's assets; this Agreement evidences the valid
and binding obligation of the Sponsor enforceable against the Sponsor in
accordance with its terms, subject to the effect of bankruptcy, insolvency,
reorganization, moratorium and other similar laws relating to or affecting
creditor's rights generally or the application of equitable principles in
any proceeding, whether at law or in equity;
(ii) All actions, approvals, consents, waivers, exemptions, variances,
franchises, orders, permits, authorizations, rights and licenses required
to be taken, given or obtained, as the case may be, by or from any federal,
state or other governmental authority or agency, that are necessary in
connection with the execution and delivery by the Sponsor of this
Agreement, have been duly taken, given or obtained, as the case may be, are
in full force and effect, are not subject to any pending proceedings or
appeals (administrative, judicial or otherwise) and either the time within
which any appeal therefrom may be taken or review thereof may be obtained
has expired or no review thereof may be obtained or appeal therefrom taken,
and are adequate to authorize the consummation of the transactions
contemplated by this Agreement on the part of the Sponsor and the
performance by the Sponsor of its obligations under this Agreement; and
(iii) There is no action, suit, proceeding or investigation pending
or, to the best of the Sponsor's knowledge, threatened against the Sponsor
which, either in any one instance or in the aggregate, may result in any
material adverse change in the business, operations, financial condition,
properties or assets of the Sponsor or in any material impairment of the
right or ability of the Sponsor to carry on its business substantially as
now conducted, or in any material liability on the part of the Sponsor or
which would draw into question the validity of this Agreement or of any
action taken or to be taken in connection with the obligations of the
Sponsor contemplated herein, or which would be likely to impair the ability
of the Sponsor to perform under the terms of this Agreement.
8
12
The representations and warranties set forth in this paragraph (b) shall
survive the sale and assignment of the Mortgage Loans to the Sponsor. Upon
discovery of a breach of any of the foregoing representations and
warranties which materially and adversely affects the interests of the
Affiliated Originator, the Affiliated Originator shall give prompt written
notice to the Sponsor. Within 30 days of its receipt of notice of breach,
the Sponsor shall cure such breach in all material respects.
Section 5. Representations and Warranties of the Affiliated
Originators Regarding the Mortgage Loans. (a) Set forth in paragraph (b)
below is a listing of representations and warranties which will be deemed
to have been made by each Affiliated Originator in connection with each
conveyance of a Pool from the Conduit Acquisition Trust to the related
Advanta Trust. In addition, a Conveyance Agreement may, with respect to the
Mortgage Loans in the related Pool, delete or modify any of such
representations and warranties, or may add additional representations and
warranties ("Additional Representations and Warranties"). The
representations and warranties listed in paragraph (b) below, together with
any Additional Representations and Warranties, are the "Representations and
Warranties". Reference to the Cut-Off Date are as of the Cut-Off Date set
forth in the related Conveyance Agreement with respect to a Mortgage Loan.
(b) With respect to each Mortgage Loan, each Affiliated Originator
hereby represents, warrants and covenants to the Sponsor and the Trustee,
as of the related Cut-Off Date, as follows, on which representations,
warranties and covenants the Trustee relies in accepting the Mortgage
Loans:
(i) The information with respect to each Mortgage Loan set forth
in the Schedules of Mortgage Loans is true and correct as of the
Cut-Off Date;
(ii) All of the original or certified documentation required to
be delivered to the Trustee pursuant to the related Advanta Pooling
Agreement (including all material documents related thereto) with
respect to each Mortgage Loan has been or will be delivered to the
Trustee in accordance with the terms of such Advanta Pooling
Agreement. Each of the documents and instruments specified to be
included therein has been duly executed and in due and proper form,
and each such document or instrument is in a form generally acceptable
to prudent mortgage lenders that regularly originate or purchase
mortgage loans comparable to the Mortgage Loans for sale to prudent
investors in the secondary market that invest in mortgage loans such
as the Mortgage Loans.
9
13
(iii) Each Mortgage Loan being transferred to the Sponsor is a
Qualified Mortgage and is a Mortgage;
(iv) Each Property is improved by a single (one-to-four) family
residential dwelling, which may include manufactured homes which
qualify as eligible for inclusion in a REMIC, condominiums and
townhouses but shall not include cooperatives;
(v) No Mortgage Loan had a Combined Loan-to-Value Ratio in excess
of 100%;
(vi) Each Mortgage is either a valid and subsisting first, second
or third lien of record on the Property (subject in the case of any
Second Mortgage Loan or Third Mortgage Loan only to a Senior Lien on
such Property) and subject in all cases to the exceptions to title set
forth in the title insurance policy, with respect to the related
Mortgage Loan, which exceptions are generally acceptable to banking
institutions in connection with their regular mortgage lending
activities, and such other exceptions to which similar properties are
commonly subject and which do not individually, or in the aggregate,
materially and adversely affect the benefits of the security intended
to be provided by such Mortgage;
(vii) Immediately prior to the transfer and assignment herein
contemplated, each Affiliated Originator held good and indefeasible
title to, and was the sole owner of, each Mortgage Loan conveyed by
such Affiliated Originator subject to no liens, charges, mortgages,
encumbrances or rights of others except liens which will be released
simultaneously with such transfer and assignment; and immediately upon
the transfer and assignment herein contemplated, the Trustee will hold
good and indefeasible title to, and be the sole owner of, each
Mortgage Loan subject to no liens, charges, mortgages, encumbrances or
rights of others except liens which will be released simultaneously
with such transfer and assignment;
(viii) As of the related Cut-Off Date, no Mortgage Loan is 30 or
more days Delinquent, except for any portion of the Mortgage Loans
which the related Advanta Pooling Agreement permits to be more than 30
days Delinquent;
(ix) There is no delinquent tax or assessment lien or mechanic's
lien on any Property, and each Property is free of substantial damage
and is in good repair;
10
14
(x) There is no valid and enforceable right of rescission offset,
defense or counterclaim to any Note or Mortgage, including the
obligation of the related Mortgagor to pay the unpaid principal of or
interest on such Note or the defense of usury, nor will the operation
of any of the terms of the Mortgage Note or the Mortgage, or the
exercise of any right thereunder, render either the Mortgage Note or
the Mortgage unenforceable in whole or in part, or subject to any
right of rescission, set-off, counterclaim or defense, including the
defense of usury, and no such right of rescission, set-off,
counterclaim or defense has been asserted with respect thereto;
(xi) There is no mechanics' lien or claim for work, labor or
material affecting any Property which is or may be a lien prior to, or
equal with, the lien of the related Mortgage except those which are
insured against by any title insurance policy referred to in paragraph
(xiii) below;
(xii) Each Mortgage Loan at the time it was made complied in all
material respects with all applicable state and federal laws and
regulations, including, without limitation, the federal
Truth-in-Lending Act and other consumer protection laws, real estate
settlement procedure, usury, equal credit opportunity, disclosure and
recording laws;
(xiii) With respect to each Mortgage Loan, a lender's title
insurance policy, issued in standard California Land Title Association
form or American Land Title Association form, or other form acceptable
in a particular jurisdiction by a title insurance company authorized
to transact business in the state in which the related Property is
situated, in an amount at least equal to the Original Principal Amount
of such Mortgage Loan insuring the mortgagee's interest under the
related Mortgage Loan as the holder of a valid first, second or third
mortgage lien of record on the real property described in the related
Mortgage, as the case may be, subject only to exceptions of the
character referred to in paragraph (vi) above, was effective on the
date of the origination of such Mortgage Loan, and, as of the Cut-Off
Date such policy will be valid and thereafter such policy shall
continue in full force and effect;
(xiv) The improvements upon each Property are covered by a valid
and existing hazard insurance policy (which may be a blanket policy of
the type described in the related Advanta Pooling Agreement) with a
generally acceptable carrier that provides for fire and extended
coverage representing coverage not less than the least of
11
15
(A) the outstanding principal balance of the related Mortgage Loan
(together, in the case of a Second Mortgage Loan, with the outstanding
principal balance of the Senior Lien), (B) the minimum amount required
to compensate for damage or loss on a replacement cost basis or (C)
the full insurable value of the Property;
(xv) If the Mortgage Loan at the time of origination relates to a
Property in an area identified in the Federal Register by the Federal
Emergency Management Agency as having special flood hazards, (which
may be a blanket policy of the type described in the related Advanta
Pooling Agreement) a flood insurance policy in a form meeting the
requirements of the current guidelines of the Federal Insurance
Administration with a generally acceptable carrier is in effect with
respect to such Property in an amount representing coverage, and which
provides for a recovery by the Master Servicer of insurance proceeds
relating to such Mortgage Loan of not less than the least of (i) the
outstanding principal balance of the Mortgage Loan, (ii) the minimum
amount required to compensate for damage or loss on a replacement cost
basis and (iii) the maximum amount of insurance that is available
under the Flood Disaster Protection Act of 1973;
(xvi) Each Mortgage and Note is the legal, valid and binding
obligation of the maker thereof and is enforceable in accordance with
its terms, except only as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors' rights generally and by
general principles of equity (whether considered in a proceeding or
action in equity or at law), and all parties to each Mortgage Loan had
full legal capacity to execute all documents relating to such Mortgage
Loan and convey the estate therein purported to be conveyed;
(xvii) Each Affiliated Originator has caused and will cause to be
performed any and all acts required to be performed to preserve the
rights and remedies of the servicer in any Insurance Policies
applicable to any Mortgage Loans delivered by such Affiliated
Originator including, to the extent such Mortgage Loan is not covered
by a blanket policy described in the Advanta Pooling Agreement, any
necessary notifications of insurers, assignments of policies or
interests therein, and establishments of co-insured, joint loss payee
and mortgagee rights in favor of the servicer;
(xviii) Each original Mortgage was recorded or is in the process
of being recorded, and all subsequent
12
16
assignments of the original Mortgage have been recorded in the
appropriate jurisdictions wherein such recordation is necessary to
perfect the lien thereof for the benefit of the applicable Affiliated
Originator, subject to the provisions of Section 3.5(b) of the Advanta
Pooling Agreement, (or are in the process of being recorded);
(xix) The terms of each Note and each Mortgage have not been
impaired, altered or modified in any respect, except by a written
instrument which has been recorded, if necessary, to protect the
interest of the owners and which has been delivered to the Trustee.
The substance of any such alteration or modification is reflected on
the related Schedule of Mortgage Loans and has been approved by the
primary mortgage guaranty insurer, if any;
(xx) The proceeds of each Mortgage Loan have been fully
disbursed, and there is no obligation on the part of the mortgagee to
make future advances thereunder. Any and all requirements as to
completion of any on-site or off-site improvements and as to
disbursements of any escrow funds therefor have been complied with.
All costs, fees and expenses incurred in making or closing or
recording such Mortgage Loans were paid;
(xxi) Except as otherwise required by law or pursuant to the
statute under which the related Mortgage Loan was made, the related
Note is not and has not been secured by any collateral, pledged
account or other security except the lien of the corresponding
Mortgage;
(xxii) No Mortgage Loan was originated under a buydown plan;
(xxiii) No Mortgage Loan provides for negative amortization, has
a shared appreciation feature, or other contingent interest feature;
(xxiv) Each Property is located in the state identified in the
Schedule of Mortgage Loans and consists of one or more parcels of
real property with a residential dwelling erected thereon;
(xxv) Each Mortgage contains a provision for the acceleration
of the payment of the unpaid principal balance of the related Mortgage
Loan in the event the related Property is sold without the prior
consent of the mortgagee thereunder;
(xxvi) Any advances made after the date of origination of a
Mortgage Loan but prior to the Cut-Off Date, have been consolidated
with the outstanding
13
17
principal amount secured by the related Mortgage, and the secured
principal amount, as consolidated, bears a single interest rate and
single repayment term reflected on the Schedule of Mortgage Loans. The
consolidated principal amount does not exceed the original principal
amount of the related Mortgage Loan. No Note permits or obligates the
Master Servicer, the Sub-Servicer or the Sponsor to make future
advances to the related Mortgagor at the option of the Mortgagor;
(xxvii) There is no proceeding pending or threatened for the
total or partial condemnation of any Property, nor is such a
proceeding currently occurring, and each Property is undamaged by
waste, fire, earthquake or earth movement, flood, tornado or other
casualty, so as to affect adversely the value of the Property as
security for the Mortgage Loan or the use for which the premises were
intended;
(xxviii) All of the improvements which were included for the
purposes of determining the Appraised Value of any Property lie wholly
within the boundaries and building restriction lines of such Property,
and no improvements on adjoining properties encroach upon such
Property, and, if a title insurance policy exists with respect to such
Property, are stated in such title insurance policy and affirmatively
insured;
(xxix) No improvement located on or being part of any Property is
in violation of any applicable zoning law or regulation. All
inspections, licenses and certificates required to be made or issued
with respect to all occupied portions of each Property and, with
respect to the use and occupancy of the same, including but not
limited to certificates of occupancy and fire underwriting
certificates, have been made or obtained from the appropriate
authorities and such Property is lawfully occupied under the
applicable law;
(xxx) With respect to each Mortgage constituting a deed of trust,
a trustee, duly qualified under applicable law to serve as such, has
been properly designated and currently so serves and is named in such
Mortgage, and no fees or expenses are or will become payable by the
Sponsor or the related Trust to the trustee under the deed of trust,
except in connection with a trustee's sale after default by the
related Mortgagor;
(xxxi) With respect to each Second Mortgage Loan and each Third
Mortgage Loan, either (A) no consent for such Mortgage Loan was
required by the holder of the related Senior Lien (and, in the case of
a Third Mortgage Loan, the holder of the related second lien) prior to
the
14
18
making of such Mortgage Loan or (B) such consent has been obtained and
is contained in the related File;
(xxxii) Each Mortgage contains customary and enforceable
provisions which render the rights and remedies of the holder thereof
adequate for the realization against the related Property of the
benefits of the security, including (A) in the case of a Mortgage
designated as a deed of trust, by trustee's sale and (B) otherwise by
judicial foreclosure. There is no homestead or other exemption
available which materially interferes with the right to sell the
related Property at a trustee's sale or the right to foreclose the
related Mortgage;
(xxxiii) Except as provided by clause (viii) of this Section,
there is no default, breach, violation or event of acceleration
existing under any Mortgage or the related Note and no event which,
with the passage of time or with notice and the expiration of any
grace or cure period, would constitute a default, breach, violation or
event of acceleration; and the applicable Affiliated Originator has
not waived any default, breach, violation or event of acceleration;
(xxxiv) Except for any Bulk Acquisition Loan, no instrument of
release or waiver has been executed in connection with any Mortgage
Loan, and no Mortgagor has been released, in whole or in part, except
in connection with an assumption agreement which has been approved by
the primary mortgage guaranty insurer, if any, and which has been
delivered to the Trustee;
(xxxv) Except for any Bulk Acquisition Loan, the maturity date of
each Mortgage Loan which is a Second Mortgage Loan or a Third Mortgage
Loan is at least twelve months prior to the maturity date of the
related first mortgage loan if such first mortgage loan provides for a
balloon payment;
(xxxvi) The credit underwriting guidelines applicable to each
Mortgage Loan which is not a Bulk Acquisition Loan or an Unaffiliated
Originator Loan conform in all material respects to the Sponsor's
underwriting guidelines;
(xxxvii) All parties to the Note and the Mortgage had legal
capacity to execute the Note and the Mortgage and each Note and
Mortgage have been duly and properly executed by such parties; and
15
19
(xxxviii) The related Affiliated Originator has no actual
knowledge that there exist on any Property any hazardous substances,
hazardous wastes or solid wastes, as such terms are defined in the
Comprehensive Environmental Response Compensation and Liability Act,
the Resource Conservation and Recovery Act of 1976, or other federal,
state or local environmental legislation.
(c) No Originator Payment Obligations. There is no obligation on
the part of the Servicer or any other party to make payments in addition to
those made by the Mortgagor except for delinquency.
The Representations and Warranties shall survive the transfer and
assignment of the Mortgage Loans to the related Advanta Trust. Upon discovery by
the Affiliated Originator or the Sponsor of a breach of any of the
Representations and Warranties, without regard to any limitation set forth in
such Representation or Warranty concerning the knowledge of the Affiliated
Originator as to the facts stated therein, which breach, in the opinion of the
Sponsor, materially and adversely affects the interests of the Sponsor, the
Owners or of the Certificate Insurer in the related Mortgage Loan or Mortgage
Loans, the party discovering such breach shall give prompt written notice to the
other party, and the related Affiliated Originator shall be required to take the
remedial actions required by the related Advanta Pooling Agreement within the
time periods required thereto. Each Affiliated Originator hereby acknowledges
that a breach of any of the Representations and Warranties listed in clauses
(iii), (x), (xvi) and (xxxviii) above a priori materially and adversely affects
the interests of the related Advanta Trust, the related Owners and the
Certificate Insurer.
Section 6. Authorized Representatives. The names of the officers
of the Affiliated Originators and of the Sponsor who are authorized to give and
receive notices, requests and instructions and to deliver certificates and
documents in connection with this Agreement on behalf of the Affiliated
Originator and of the Sponsor ("Authorized Representatives") are set forth on
Exhibit B. From time to time, the Affiliated Originator and the Sponsor may, by
delivering to the Trustee a revised exhibit, change the information previously
given, but the Trustee shall be entitled to rely conclusively on the last
exhibit until receipt of a superseding exhibit.
Section 7. Notices. All demands, notices and communications
relating to this Agreement shall be in writing and shall be deemed to have been
duly given when received by the other party or parties at the address shown
below, or such other address as may hereafter be furnished to the other party or
parties by like notice. Any such demand, notice or
16
20
communication hereunder shall be deemed to have been received on the date
delivered to or received at the premises of the addressee.
If to the Trustee:
Bankers Trust Company of California, N.A.
▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Affiliated Originators or the Sponsor:
Advanta Mortgage Corp. USA
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Treasurer
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Section 8. Governing Law. This Agreement shall be governed by,
and construed in accordance with, the laws of the State of New York, without
regard to conflict of laws rules applied in the State of New York.
Section 9. Assignment. No party to this Agreement may assign its
rights or delegate its obligations under this Agreement without the express
written consent of the other parties, except as otherwise set forth in this
Agreement.
Section 10. Counterparts. For the purpose of facilitating the
execution of this Agreement and for other purposes, this Agreement may be
executed simultaneously in any number of counterparts, each of which shall be
deemed to be an original, and together shall constitute and be one and the same
instrument.
Section 11. Amendment. This Agreement may be amended from time to
time by the Affiliated Originators, the Sponsor and the Trustee only by a
written instrument executed by such parties and with the prior written consent
of the Certificate Insurer.
Section 12. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement.
17
21
Section 13. No Agency; No Partnership or Joint Venture. Neither
the Affiliated Originators nor the Sponsor is the agent or representative of the
other, and nothing in this Agreement shall be construed to make either the
Affiliated Originator nor the Sponsor liable to any third party for services
performed by it or for debts or claims accruing to it against the other party.
Nothing contained herein nor the acts of the parties hereto shall be construed
to create a partnership or joint venture between the Sponsor and the Affiliated
Originator.
Section 14. Further Assurances. The Affiliated Originators and
Sponsor agree to cooperate reasonably and in good faith with one another in the
performance of this Agreement.
Section 15. The Certificate Insurer. The Certificate Insurer is a
third-party beneficiary of this Agreement. Any right conferred to the
Certificate Insurer shall be suspended during any period in which the
Certificate Insurer is in default in its payment obligation's under the related
Certificate Insurance Policies. During any period of suspension, the Certificate
Insurer's rights hereunder shall vest in the Owners of the related Offered
Certificates and shall be exercisable by the owners of at least a majority in
Percentage Interest of the related Offered Certificates then outstanding. At
such time as the related Offered Certificates are no longer Outstanding under
the related Advanta Pooling Agreement and the Certificate Insurer has been
reimbursed for all Insured Payments to which it is entitled under the related
Advanta Pooling Agreement, the Certificate Insurer's rights hereunder shall
terminate.
Section 16. Maintenance of Records. Each Affiliated Originator
shall each continuously keep an original executed counterpart of this Agreement
in its official records.
18
22
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers, all as of the day and year first
above written.
ADVANTA MORTGAGE CORP. USA
ADVANTA MORTGAGE CORP. MIDATLANTIC
ADVANTA MORTGAGE CORP. MIDATLANTIC II
ADVANTA MORTGAGE CORP. MIDWEST
ADVANTA MORTGAGE CORP. OF NEW JERSEY
ADVANTA MORTGAGE CORP. NORTHEAST
ADVANTA MORTGAGE CONDUIT SERVICES, INC.
ADVANTA FINANCE CORP.
ADVANTA NATIONAL BANK USA
ADVANTA CONDUIT RECEIVABLES, INC.
The Sellers
BY:
--------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President
BANKERS TRUST COMPANY OF CALIFORNIA,
N.A., as Trustee and not in its
individual capacity
By:
--------------------------------------
Name:
Title:
ADVANTA MORTGAGE CONDUIT SERVICES,
INC. as Sponsor
By:
--------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President
19
23
EXHIBIT A
CONVEYANCE AGREEMENT
Advanta Mortgage Corp. USA, Advanta Mortgage Corp. Midatlantic, Advanta
Mortgage Corp. Midatlantic II, Advanta Mortgage Corp. Midwest, Advanta Mortgage
Corp. of New Jersey, Advanta Mortgage Corp. Northeast, Advanta Mortgage Conduit
Services, Inc., Advanta Finance Corp. and Advanta National Bank USA, as
Affiliated Originators and Advanta Mortgage Conduit Services, Inc., as Sponsor,
pursuant to the Master Loan Transfer Agreement dated as of February 15, 1995
among themselves and Bankers Trust Company of California, N.A. as Trustee (the
"Mortgage Transfer Agreement"), hereby confirm their understanding with respect
to the conveyance by each Affiliated Originator and the Sponsor of those
Mortgage Loans listed on the attached Schedule of Mortgage Loans (the
"Transferred Mortgage Loans") from the Conduit Acquisition Trust to the Advanta
Mortgage Loan Trust - .
Conveyance of Transferred Mortgage Loans. Each Affiliated Originator
and the Sponsor, concurrently with the execution and delivery of this Conveyance
Agreement, does hereby irrevocably transfer, assign, set over and otherwise
convey, and does direct the Trustee to convey from the Conduit Acquisition Trust
to the Advanta Mortgage Loan Trust - , without recourse (except as
otherwise explicitly provided for herein) all of its right, title and interest
in and to the Transferred Mortgage Loans being conveyed by it, including
specifically, without limitation, the Mortgages (as such term is defined in the
"related Advanta Pooling Agreement"), the Files and all other documents,
materials and properties appurtenant thereto and the Notes, including all
interest and principal received by such Affiliated Originator on or with respect
to such Transferred Mortgage Loans on or after the related Cut-off Date,
together with all of its right, title and interest in and to the proceeds
received on or after the related Cut-off Date of any related insurance policies.
If an Affiliated Originator cannot deliver the original Mortgage or
mortgage assignment with evidence of recording thereon concurrently with the
execution and delivery of this Conveyance Agreement solely because of a delay
caused by the public recording office where such original Mortgage or mortgage
assignment has been delivered for recordation, such Affiliated Originator shall
promptly deliver to the Trustee such original Mortgage or mortgage assignment
with evidence of recording indicated thereon upon receipt thereof from the
public recording official.
A-1
24
The costs relating to the delivery of the documents specified in this
Conveyance Agreement shall be borne by each Affiliated Originator.
The Affiliated Originators hereby make the Representations and
Warranties set forth in Section 5(b) of the Master Transfer Agreement with
respect to the Transferred Mortgage Loans.
The "Cut-Off Date" with respect to such Transferred Mortgage Loans shall
be _____ __, ____.
All terms and conditions of the Mortgage Transfer Agreement are hereby
incorporated herein, provided that in the event of any conflict the provisions
of this Conveyance Agreement shall control over the conflicting provisions of
the Mortgage Transfer Agreement.
For purposes of this Conveyance Agreement, the "related Advanta Pooling
Agreement" is the Pooling and Servicing Agreement dated as of _____ __, ____
relating to Advanta Mortgage Loan Trust - .
A-2
25
Terms capitalized herein and not defined herein shall have their
respective meanings as set forth in the Mortgage Transfer Agreement.
ADVANTA MORTGAGE CORP. USA
ADVANTA MORTGAGE CORP. MIDATLANTIC
ADVANTA MORTGAGE CORP. MIDATLANTIC II
ADVANTA MORTGAGE CORP. MIDWEST
ADVANTA MORTGAGE CORP. OF NEW JERSEY
ADVANTA MORTGAGE CORP. NORTHEAST
ADVANTA MORTGAGE CONDUIT SERVICES, INC.
ADVANTA FINANCE CORP.
ADVANTA NATIONAL BANK USA,
ADVANTA CONDUIT RECEIVABLES, INC.
as Affiliated Originators
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Vice President
ADVANTA MORTGAGE CONDUIT SERVICES,
INC.
as Sponsor
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Vice President
BANKERS TRUST COMPANY
OF CALIFORNIA, N.A.,
as Trustee
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
--------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Senior Vice President
Dated:
A-3
26
EXHIBIT B
AUTHORIZED REPRESENTATIVES
Reference is hereby made to the Master Loan Transfer Agreement, dated
as of February 15, 1995 (the "Agreement"), among Advanta Mortgage Corp. USA,
Advanta Mortgage Corp. Midatlantic, Advanta Mortgage Corp. Midatlantic II,
Advanta Mortgage Corp. Midwest, Advanta Mortgage Corp. of New Jersey, Advanta
Mortgage Corp. Northeast, Advanta Mortgage Conduit Services, Inc., Advanta
Finance Corp. and Advanta National Bank USA, as Affiliated Originators, Advanta
Mortgage Conduit Services, Inc., as Sponsor and Bankers Trust Company of
California, N.A., as Trustee:
The following are the Affiliated Originators' Authorized
Representatives for purposes of the Agreement:
Name Title
---- -----
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior Vice President, General Counsel and
Secretary
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Treasurer
The following are the Sponsor's Authorized Representatives for purposes
of the Agreement:
Name Title
---- -----
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior Vice President, General Counsel and
Secretary
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Treasurer
B-1