Exhibit 99.4
MASTER MORTGAGE LOAN SALE AND SERVICING AGREEMENT
between
ABN AMRO Mortgage Group, Inc.,
as Seller
and
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE LENDING, INC.
as Purchaser
Dated as of October 1, 2006
Fixed Rate and Adjustable Rate
Mortgage Loans
TABLE OF CONTENTS
Page
----
SECTION 1. Definitions.................................................. 1
SECTION 2. Purchase and Conveyance...................................... 11
SECTION 3. Mortgage Loan Schedule....................................... 11
SECTION 4. Purchase Price............................................... 11
SECTION 5. Delivery of Mortgage Loan Documents.......................... 11
Section 5.01. Possession of Mortgage Files........................ 11
Section 5.02. Books and Records................................... 12
Section 5.03. Delivery of Mortgage Loan Documents................. 12
SECTION 6. Representations, Warranties and Covenants; Remedies for
Breach....................................................... 13
Section 6.01. Representations and Warranties Regarding Individual
Mortgage Loans...................................... 13
Section 6.02. Representations of Seller........................... 23
Section 6.03. Remedies for Breach of Representations and
Warranties.......................................... 24
Section 6.04. Indemnification..................................... 26
SECTION 7. Intentionally Omitted........................................ 27
SECTION 8. Closing...................................................... 27
SECTION 9. Closing Documents............................................ 27
SECTION 10. Costs........................................................ 28
SECTION 11. Administration and Servicing of the Mortgage Loans........... 28
Section 11.01. Seller to Act as Servicer........................... 28
Section 11.02. Liquidation of Mortgage Loans....................... 29
Section 11.03. Collection of Mortgage Loan Payments................ 29
Section 11.04. Establishment of Payment Clearing Accounts.......... 29
Section 11.05. Establishment of Custodial Accounts; Deposits in
Custodial Accounts.................................. 30
Section 11.06. Withdrawals From the Custodial Account.............. 31
Section 11.07. Establishment of Escrow Account; Deposits in Escrow
Account............................................. 32
Section 11.08. Withdrawals From Escrow Account..................... 33
Section 11.09. Payment of Taxes, Insurance and Other Charges;
Collections Thereunder.............................. 33
Section 11.10. Transfer of Accounts................................ 34
Section 11.11. Maintenance of Hazard Insurance..................... 34
Section 11.12. Maintenance of Primary Mortgage Insurance Policy;
Claims.............................................. 35
Section 11.13. Fidelity Bond; Errors and Omissions Insurance....... 36
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Section 11.14. Title, Management and Disposition of REO Property... 36
Section 11.15. Servicing Compensation.............................. 38
Section 11.16. Distributions....................................... 38
Section 11.17. Statements to Purchaser............................. 38
Section 11.18. Advances by Seller.................................. 39
Section 11.19. Assumption Agreements............................... 39
Section 11.20. Satisfaction of Mortgages and Release of Mortgage
Loan Documents...................................... 40
Section 11.21. Annual Statement of Compliance...................... 40
Section 11.22. Annual Independent Public Accountants' Servicing
Report.............................................. 40
Section 11.23. Seller Shall Provide Access and Information as
Reasonably Required................................. 41
Section 11.24. Notification of Adjustments......................... 41
Section 11.25. Compliance With REMIC Provisions.................... 41
SECTION 12. Seller....................................................... 42
Section 12.01. Indemnification; Third Party Claims................. 42
Section 12.02. Merger or Consolidation of Seller................... 43
Section 12.03. Limitation on Liability of Seller and Others........ 43
Section 12.04. Seller Not to Resign................................ 43
SECTION 13. Default...................................................... 44
Section 13.01. Events of Default...................................... 44
Section 13.02. Waiver of Defaults..................................... 45
SECTION 14. Termination.................................................. 45
Section 14.01. Termination......................................... 45
Section 14.02. Termination of Seller Without Cause................. 45
Section 14.03. Successors to Seller................................ 46
SECTION 15. Notices...................................................... 46
SECTION 16. Severability Clause.......................................... 47
SECTION 17. No Partnership............................................... 48
SECTION 18. Counterparts and Facsimile Transmission...................... 48
SECTION 19. Governing Law................................................ 48
SECTION 20. Intention of the Parties..................................... 48
SECTION 21. Successors and Assigns....................................... 48
SECTION 22. Waivers...................................................... 48
SECTION 23. Exhibits..................................................... 49
SECTION 24. General Interpretive Principles.............................. 49
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SECTION 25. Reproduction of Documents.................................... 49
SECTION 26. Amendment.................................................... 49
SECTION 27. Confidentiality.............................................. 49
SECTION 28. Entire Agreement............................................. 50
SECTION 29. Further Agreements........................................... 50
SECTION 30. Nonsolicitation.............................................. 50
SECTION 31. Financial Statements......................................... 50
SECTION 32. Whole Loan Transfers and Securitization Transactions......... 50
SECTION 33. Compliance with Regulation AB................................ 53
Subsection 33.01. Intent of the Parties; Reasonableness............... 53
Subsection 33.02. Additional Representations and Warranties of the
Seller.............................................. 54
Subsection 33.03. Information to Be Provided by the Seller............ 54
Subsection 33.04. Servicer Compliance Statement....................... 59
Subsection 33.05. Report on Assessment of Compliance and Attestation.. 59
Subsection 33.06. Use of Subservicers and Subcontractors.............. 60
Subsection 33.07. Indemnification; Remedies........................... 62
SECTION 34. JURY WAIVER......................................... 64
EXHIBITS
EXHIBIT 1 MORTGAGE LOAN DOCUMENTS
EXHIBIT 2 CONTENTS OF EACH MORTGAGE FILE
EXHIBIT 3 SELLER'S OFFICER'S CERTIFICATE
EXHIBIT 4 OPINION OF COUNSEL TO SELLER
EXHIBIT 5 CUSTODIAL ACCOUNT CERTIFICATION
EXHIBIT 6 ESCROW ACCOUNT CERTIFICATION
EXHIBIT 7 ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
(for Whole Loan Transfer)
EXHIBIT 8 ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
(for Securitization Transaction)
EXHIBIT 9 INDEMNIFICATION LETTER
EXHIBIT 10 FORM OF ANNUAL CERTIFICATION
EXHIBIT 11 SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
EXHIBIT 12 ASSIGNMENT AND CONVEYANCE
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MASTER MORTGAGE LOAN SALE AND SERVICING AGREEMENT
(ABN AMRO Mortgage Group, Inc. as Seller)
THIS MASTER MORTGAGE LOAN SALE AND SERVICING AGREEMENT (the "Agreement"),
dated as of October 1, 2006, is executed by and between ABN AMRO Mortgage Group,
Inc., a Delaware corporation, as seller and as servicer (hereinafter referred to
as the "Seller"), and ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Lending, Inc., as purchaser (the
"Purchaser").
RECITALS:
A. Purchaser may agree to purchase from Seller from time to time and Seller
desires to sell to Purchaser from time to time, certain conventional fixed rate
and adjustable rate residential first-lien mortgage loans (the "Mortgage Loans")
as described herein on a servicing-retained basis, which shall be delivered as
whole loans as provided herein;
B. Each Mortgage Loan is secured by a mortgage, deed of trust or other
security instrument creating a first lien on a residential dwelling located in
the jurisdiction indicated on the related Mortgage Loan Schedule; and
C. Purchaser and Seller wish to prescribe the manner of the conveyance,
servicing and control of the Mortgage Loans;
NOW, THEREFORE, in consideration of the premises and mutual agreements set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Purchaser and Seller agree as
follows:
SECTION 1. Definitions.
For purposes of this Agreement, the following capitalized terms shall have
the respective meanings set forth below.
Adjustable Rate Mortgage Loan: A Mortgage Loan with an adjustable interest
rate, which is identified as such on the Mortgage Loan Schedule.
Adjustment Date: With respect to each Adjustable Rate Mortgage Loan, the
date set forth in the related Mortgage Note on which the Mortgage Interest Rate
is adjusted in accordance with the terms of the related Mortgage Note.
Agency: FNMA or FHLMC or both of them.
Agreement: This Master Mortgage Loan Sale and Servicing Agreement including
all exhibits, schedules, amendments and supplements hereto.
ALTA: The American Land Title Association.
Appraised Value: With respect to any Mortgaged Property, the lesser of (i)
the value thereof as determined by a collateral assessment report that meets
Seller's requirements for delivery to the Agency made for the originator of the
Mortgage Loan at the time of origination of
the Mortgage Loan and (ii) the purchase price paid for the related Mortgaged
Property by Mortgagor with the proceeds of the Mortgage Loan.
Assignment of Mortgage: An individual assignment of the Mortgage, notice of
transfer or equivalent instrument in recordable form and in blank, sufficient
under the laws of the jurisdiction in which the related Mortgaged Property is
located to give record notice of the transfer of the Mortgage to Purchaser.
Business Day: Any day other than a Saturday or Sunday, or a day on which
banking and savings and loan institutions, in the state where (i) Seller is
located or (ii) the Custodial Account is maintained, are authorized or obligated
by law or executive order to be closed.
Closing Date: The date or dates set forth in a Commitment Letter as the
closing date or dates for the purchase by Purchaser from Seller, from time to
time, of Mortgage Loans listed on the Mortgage Loan Schedule.
Closing Documents: The documents required to be delivered on the Closing
Date pursuant to Section 9.
Code: The Internal Revenue Code of 1986 as it may be amended from time to
time, or any successor statute thereto.
Combined Loan-to-Value Ratio or CLTV: With respect to any Mortgage Loan,
the fraction, expressed as a percentage, the numerator of which is the sum of
(a) the original principal balance of the Mortgage Loan, plus (b) the unpaid
principal balance of any related subordinate mortgage loan or loans secured by
the Mortgaged Property, and the denominator of which is the Appraised Value of
the related Mortgaged Property.
Commitment Letter: A letter agreement between Seller and Purchaser whereby
Seller agrees to sell, and Purchaser agrees to purchase, certain Mortgage Loans.
Condemnation Proceeds: All awards, compensation and settlements in respect
of a taking of all or part of a Mortgaged Property by exercise of the power of
condemnation or the right of eminent domain, to the extent not required to be
released to a Mortgagor in accordance with Customary Servicing Procedures and
the related Mortgage Loan Documents.
Convertible Mortgage Loan: A Mortgage Loan that by its terms and subject to
certain conditions contained in the related Mortgage or Mortgage Note allows
Mortgagor to convert the adjustable Mortgage Interest Rate on such Mortgage Loan
to a fixed Mortgage Interest Rate.
Custodial Account: One or more accounts created and maintained pursuant to
Section 11.05, which accounts shall be held as a special deposit by Seller or
its affiliates, maintaining such accounts in a fiduciary capacity, separate and
apart from its funds or general assets and shall not be held in any capacity
that would create a debtor-creditor relationship between the depository
institution maintaining the accounts and Seller or Purchaser.
Customary Servicing Procedures: Procedures (including collection
procedures) that Seller customarily employs and exercises in servicing and
administering mortgage loans for its
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own account. The Servicing Procedures set out in the Servicing Guidelines shall
be deemed to be Customary Servicing Procedures.
Cut-off Date: A date denominated as such in a Commitment Letter.
Cut-off Date Principal Balance: The aggregate Stated Principal Balance of
the Mortgage Loans as of the Cut-off Date which is determined after the
application, to the reduction of principal, of payments of principal due on or
before the Cut-off Date, whether or not collected, and of partial principal
prepayments received on or before the Cut-off Date.
Deleted Mortgage Loan: A Mortgage Loan replaced or to be replaced with a
Qualified Substitute Mortgage Loan in accordance with this Agreement.
Depositor: The depositor, as such term is defined in Regulation AB, with
respect to any Securitization Transaction.
Determination Date: With respect to each Remittance Date, the 15th day (or,
if such 15th day is not a Business Day, the prior Business Day) of the month in
which such Remittance Date occurs.
Due Date: With respect to each Remittance Date, the first day of the
calendar month in which such Remittance Date occurs, which is the day on which
the Monthly Payment is due on a Mortgage Loan, exclusive of any days of grace.
Eligible Account: A Custodial Account maintained with Seller or its
affiliates, the unsecured and uncollateralized debt obligations of which shall
be rated "A" or better by S&P and "A2" or better by Moody's and in the second
highest short-term rating category by S&P and the second highest short term
rating category by Moody's, and which is either (i) a federal savings and loan
association duly organized, validly existing and in good standing under the
federal banking laws, (ii) an institution duly organized, validly existing and
in good standing under the applicable banking laws of any state; or (iii) a
national banking association duly organized, validly existing and in good
standing under the federal banking laws.
Eligible Investment: Any one or more of the obligations and securities
listed below which investment provides for a date of maturity not later than the
Remittance Date in each month:
(1) direct obligations of or obligations fully guaranteed by, (i) the
United States of America, or (ii) any agency or instrumentality of the
United States of America, the obligations of which are backed by the
full faith and credit of the United States of America;
(2) federal funds, demand, money market, or time deposits in,
certificates of deposits of, or banker's acceptances issued by any
depository institution or trust company incorporated or organized
under the laws of the United States of America or any state thereof,
subject to supervision and examination by federal and/or state banking
authorities, and, at the time of such investment or contractual
commitment providing for such investment, whose commercial paper or
other short-term debt obligations (or, in the case of a depository
institution or trust
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company that is a subsidiary of a holding company, the commercial
paper or other short-term debt obligations of such holding company) is
rated "P-1" by Moody's and "A-1" by S&P and whose long-term debt
obligations (or, in the case of a depository institution that is a
subsidiary of a holding company, the long-term debt obligations of
such holding company) are rated at least "Aa2" by ▇▇▇▇▇'▇ and "AA" by
S&P (collectively, with all other rating categories set out in this
paragraph, the "Investment Ratings").
Notwithstanding the foregoing, Eligible Investments shall not include (i)
"stripped securities," (ii) any investments which contractually may return less
than the unpaid principal balance therefor, or (iii) a direct purchase of
commercial paper from the issuer.
Escrow Account: One or more accounts created and maintained pursuant to
Section 11.07.
Escrow Payments: The amounts constituting ground rents, taxes, assessments,
Primary Mortgage Insurance Policy premiums, fire, hazard, flood or earthquake
insurance premiums and other payments as may be required to be escrowed by
Mortgagor with the Mortgagee pursuant to the terms of any Mortgage Note or
Mortgage.
Event of Default: Any one of the conditions or circumstances enumerated in
Section 13.01.
Exchange Act: The Securities Exchange Act of 1934, as amended.
▇▇▇▇▇▇ ▇▇▇: ▇▇▇▇▇▇ ▇▇▇ (formerly known as the Federal National Mortgage
Association) or any successor thereto.
▇▇▇▇▇▇ Mae Guides: The ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇' Guide and the ▇▇▇▇▇▇ Mae
Servicer's Guide and all amendments or additions thereto.
FDIC: The Federal Deposit Insurance Corporation or any successor thereto.
FHLMC: The Federal Home Loan Mortgage Corporation or any successor thereto.
Fidelity Bond: The fidelity bond required to be obtained by Seller pursuant
to Section 11.13.
Fixed Rate Mortgage Loan: A Mortgage Loan with a fixed interest rate, which
is identified as such on the Mortgage Loan Schedule.
FNMA: The Federal National Mortgage Association or any successor thereto.
▇▇▇▇▇▇▇ Mac: ▇▇▇▇▇▇▇ Mac (formerly known as The Federal Home Loan Mortgage
Corporation) or any successor thereto.
Gross Margin: With respect to each Adjustable Rate Mortgage Loan, the fixed
percentage amount set forth in the related Mortgage Note that is added to the
Index on each Adjustment
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Date in accordance with the terms of the related Mortgage Note to determine the
new Mortgage Interest Rate for such Mortgage Loan.
Index: With respect to each Adjustable Rate Mortgage Loan, the index
identified on the Mortgage Loan Schedule and set forth in the related Mortgage
Note for the purpose of calculating the interest rate as stated in the Mortgage
Note.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
Liquidating Loan: A Mortgage Loan as to which, prior to the close of
business on the Business Day next preceding the Due Date, (a) has become an REO
Property or (b) Seller has accepted a deed to the related Mortgaged Property in
lieu of foreclosure in whole or partial satisfaction of the Mortgage Loan.
Liquidation Proceeds: The proceeds received in connection with the
liquidation of a defaulted Mortgage Loan through trustee's sale, foreclosure
sale or otherwise, other than amounts received following the acquisition of REO
Property, Insurance Proceeds and Condemnation Proceeds.
Loan-to-Value Ratio (LTV): With respect to any Mortgage Loan as of any date
of determination, the ratio, expressed as a percentage, on such date of the
outstanding principal balance of the Mortgage Loan, to the Appraised Value of
the related Mortgaged Property.
Maximum Mortgage Interest Rate: With respect to each Adjustable Rate
Mortgage Loan, a rate that is set forth in the related Mortgage Note and is the
absolute maximum interest rate to which the Mortgage Interest Rate on such
Mortgage Loan may be increased.
Minimum Mortgage Interest Rate: With respect to each Adjustable Rate
Mortgage Loan, a rate that is set forth in the related Mortgage Note and is the
absolute minimum interest rate to which the Mortgage Interest Rate on such
Mortgage Loan may be decreased.
Monthly Payment: With respect to any Mortgage Loan, the scheduled monthly
payment of principal and interest payable by a Mortgagor under the related
Mortgage Note on each Due Date.
Moody's: ▇▇▇▇▇'▇ Investors Service, Inc. or its successor in interest.
Mortgage: The mortgage, deed of trust or other instrument creating a first
lien on the Mortgaged Property securing the Mortgage Note.
Mortgage File: With respect to any Mortgage Loan, the items listed in
Exhibit 2 hereto.
Mortgage Interest Rate: With respect to each Mortgage Loan, the annual rate
at which interest accrues on such Mortgage Loan from time to time in accordance
with the provisions of the related Mortgage Note.
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Mortgage Loan: Each mortgage loan sold, assigned and transferred pursuant
to this Agreement and identified on the Mortgage Loan Schedule, including,
without limitation, the Mortgage File, the Monthly Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
REO Disposition Proceeds, and all other rights, benefits, proceeds and
obligations arising from or in connection with such Mortgage Loan.
Mortgage Loan Documents: With respect to any Mortgage Loan, the documents
listed in Exhibit 1 hereto.
Mortgage Loan Remittance Rate: As to each Mortgage Loan, the annual rate of
interest payable to Purchaser, which shall be equal to the related Mortgage
Interest Rate minus the related Servicing Fee Rate.
Mortgage Loan Schedule: The schedule of Mortgage Loans annexed to the
related Assignment and Conveyance as of the related Closing Date.
Mortgage Note: The original executed note evidencing the indebtedness of a
Mortgagor under a Mortgage Loan.
Mortgaged Property: The real property, consisting of a fee simple interest
or Agency approved leasehold estate in single or multiple contiguous parcels of
real property improved by a Residential Dwelling, which secures repayment of the
debt evidenced by the related Mortgage Note.
Mortgagee: The mortgagee or beneficiary named in the Mortgage and the
successors and assigns of such mortgagee or beneficiary.
Mortgagor: The obligor on a Mortgage Note.
P&I Advance: As defined in Section 11.18.
Payment Clearing Account: An Eligible Account created and maintained
pursuant to Section 11.04 and that is designated "ABN AMRO's Payment Clearing
Account in trust for the account of others".
Periodic Rate Cap: With respect to each Adjustable Rate Mortgage Loan and
any Adjustment Date therefor, a number of percentage points per annum that is
set forth in the related Mortgage Note, which is the maximum amount by which the
Mortgage Interest Rate for such Mortgage Loan may increase (without regard to
the Maximum Mortgage Interest Rate) or decrease (without regard to the Minimum
Mortgage Interest Rate) on such Adjustment Date from the Mortgage Interest Rate
in effect immediately prior to such Adjustment Date.
Person: An individual, corporation, partnership, joint venture,
association, joint-stock company, limited liability company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
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Prepayment Charge: With respect to any Mortgage Loan, any prepayment
penalty or premium thereon payable in connection with a principal prepayment on
such Mortgage Loan pursuant to the terms of the related Mortgage Note.
Primary Mortgage Insurance Policy: A policy of primary mortgage guaranty
insurance issued by an insurer acceptable to the Agency.
Principal Prepayment: Any payment or other recovery of principal on a
Mortgage Loan which is received in advance of its scheduled Due Date, including
any Prepayment Charge, which is not accompanied by an amount of interest
representing scheduled interest due on any date or dates in any month or months
subsequent to the month of prepayment.
Private Securitization Transaction: The sale or transfer of some or all of
the Mortgage Loans to a trust to be formed as part of a privately placed, rated
or unrated, mortgage pass-through transaction.
Purchase Price: The price paid on the related Closing Date by Purchaser to
Seller pursuant to a Commitment Letter and this Agreement in exchange for the
Mortgage Loans listed on the Mortgage Loan Schedule, which price shall be the
percentage of par set forth in the Commitment Letter times the Cut-off Date
Principal Balance of those Mortgage Loans.
Purchaser: The Person listed as such in the initial paragraph of this
Agreement, together with its successors and assigns as permitted under the terms
of this Agreement.
Purchaser's Agent: An agent of Purchaser, such as a master servicer or
depositor.
Qualified Correspondent: Any Person from which Seller purchased Mortgage
Loans, provided that the following conditions are satisfied: (i) such Mortgage
Loans were originated pursuant to an agreement between Seller and such Person
that contemplated that such Person would underwrite mortgage loans from time to
time, for sale to Seller, in accordance with underwriting guidelines designated
by Seller ("Designated Guidelines") or guidelines that do not vary materially
from such Designated Guidelines; (ii) such Mortgage Loans were acquired by
Seller within 180 days after origination; (iii) either (x) the Designated
Guidelines were, at the time such Mortgage Loans were originated, used by Seller
in origination of mortgage loans of the same type as the Mortgage Loans for
Seller's own account or (y) the Designated Guidelines were, at the time such
Mortgage Loans were underwritten, designated by Seller on a consistent basis for
use by lenders in originating mortgage loans to be purchased by Seller; and (iv)
Seller employed, at the time such Mortgage Loans were acquired by Seller,
pre-purchase or post-purchase quality assurance procedures (which may involve,
among other things, review of a sample of mortgage loans purchased during a
particular time period or through particular channels) designed to ensure that
Persons from which it purchased mortgage loans properly applied the underwriting
criteria designated by Seller.
Qualified Depository: Any institution offering an Eligible Account.
Qualified Substitute Mortgage Loan: A mortgage loan substituted by Seller
for a Deleted Mortgage Loan which must, on the date of such substitution, be
approved by Purchaser and (i) have an outstanding principal balance, after
deduction of all scheduled payments due in the
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month of substitution (or in the case of a substitution of more than one
mortgage loan for a Deleted Mortgage Loan, an aggregate principal balance), not
in excess of the Stated Principal Balance of the Deleted Mortgage Loan (the
amount of any shortfall will be distributed by Seller to Purchaser in the month
of substitution), (ii) have a Mortgage Interest Rate not less than (and not more
than two percent (2%) greater than) the Mortgage Interest Rate of the Deleted
Mortgage Loan, (iii) have a remaining term to maturity not greater than (and not
more than one (1) year less than) that of the Deleted Mortgage Loan, (iv) be of
the same type as the Deleted Mortgage Loan and (v) comply as of the date of
substitution with each representation and warranty set forth in Section 6.01.
Reconstitution Agreement: Any of the agreement or agreements entered into
by Purchaser and/or certain third parties, and if necessary Seller, on the
Reconstitution Date or Dates with respect to any or all of the Mortgage Loans
conveyed hereunder, in connection with a Transfer, pursuant to which Seller
shall recognize the Transferee as the owner of the Mortgage Loans and covenant
to service the Mortgage Loans on behalf of the Transferee in accordance with the
terms and conditions of this Agreement, or as otherwise therein mutually agreed
to by Seller and Purchaser.
Reconstitution Date: The date or dates on which any or all of the Mortgage
Loans purchased pursuant to this Agreement shall be reconstituted as part of a
Whole Loan Transfer or a Securitization Transaction.
Record Date: The close of business of the last Business Day of the month
preceding the month of the related Remittance Date.
Refinanced Mortgage Loan: A Mortgage Loan the proceeds of which were not
used to purchase the related Mortgaged Property.
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation AB),
17 C.F.R. Sections 229.1100-229.1123, as such may be amended from time to time,
and subject to such clarification and interpretation as have been provided by
the Commission in the adopting release (Asset-Backed Securities, Securities Act
Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff
of the Commission, or as may be provided by the Commission or its staff from
time to time.
REMIC: A "real estate mortgage investment conduit" within the meaning of
Section 860D of the Code.
REMIC Provisions: Provisions of the federal income tax law relating to a
REMIC, which appear at Section 860A through 860G of Subchapter M of Chapter 1,
Subtitle A of the Code, and related provisions and regulations promulgated
thereunder, as the foregoing may be in effect from time to time.
Remittance Date: The 18th day of each month, beginning one (1) month after
the Cut-off Date (or, if such day is not a Business Day, the following Business
Day).
REO Disposition: The final sale by Seller of an REO Property.
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REO Disposition Proceeds: All amounts received with respect to an REO
Disposition pursuant to Section 11.14.
REO Property: A Mortgaged Property acquired by Seller through foreclosure
or deed in lieu of foreclosure, as described in Section 11.14.
Repurchase Price: Except as otherwise provided in the last two paragraphs
of Section 6.03, with respect to any Mortgage Loan, a price equal to (i) the
Stated Principal Balance of such Mortgage Loan as of the date of repurchase,
plus (ii) interest on such Stated Principal Balance at the Mortgage Loan
Remittance Rate from and including the last Due Date through which interest has
been paid on behalf of Mortgagor or advanced by Seller to the last day of the
month in which such repurchase occurs, minus (iii) amounts received in respect
of such repurchased Mortgage Loan which are being held in the Custodial Account
for distribution in connection with such Mortgage Loan.
Residential Dwelling: Any one of the following: (i) a detached one-family
dwelling, (ii) a detached two- to four-family dwelling, (iii) a one-family
dwelling unit in a condominium project, or (iv) a one-family dwelling in a
planned unit development, none of which is a cooperative or a manufactured or
mobile home.
Securities Act of 1933 or the 1933 Act: The Securities Act of 1933, as
amended.
Securitization Transaction: The sale or transfer of some or all of the
Mortgage Loans to a trust to be formed as part of a publicly-issued, rated or
unrated, mortgage pass-through transaction.
Seller: The Person listed as such in the initial paragraph of this
Agreement, together with its successors and assigns as permitted under the terms
of this Agreement.
Seller Information: The Static Pool Information provided by Seller and the
information provided by Seller pursuant to Section 33.02 of this Agreement, each
in the form and substance as provided by Seller
Servicer: As defined in Section 33.03(c).
Servicing Advances: All customary, reasonable and necessary out-of-pocket
costs and expenses incurred in the performance by Seller of its servicing
obligations, including, but not limited to, the cost of (a) the preservation,
restoration and protection of the Mortgaged Property, (b) any enforcement or
judicial proceedings, including foreclosures, (c) the management and liquidation
of the Mortgaged Property if the Mortgaged Property is acquired in satisfaction
of the Mortgage, and (d) payments made by Seller with respect to a Mortgaged
Property pursuant to Section 11.09.
Servicing Criteria: The "servicing criteria" set forth in Item 1122(d) of
Regulation AB, as such may be amended from time to time, if affirmatively noted
on Exhibit 11.
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Servicing Fee: With respect to each Mortgage Loan, the amount of the annual
fee Purchaser shall pay to Seller, which shall, for each month, be equal to
one-twelfth of the product of the Servicing Fee Rate and the principal balance
of such Mortgage Loan.
Servicing Fee Rate: With respect to each Mortgage Loan, an amount equal to
the percentage per annum shown in the Commitment Letter.
Servicing Guidelines: Such manuals, guides and bulletins as may be
published by the Agency from time to time.
S&P: Standard & Poor's Ratings Services, a Division of the ▇▇▇▇▇▇-▇▇▇▇
Companies, Inc. or its successor in interest.
Stated Principal Balance: As to each Mortgage Loan as of any date of
determination, (i) the principal balance of the Mortgage Loan at the Cut-off
Date after giving effect to payments of principal due on or before such date,
whether or not received, minus (ii) all amounts previously distributed to
Purchaser with respect to the Mortgage Loan representing payments or recoveries
of principal, or advances in lieu thereof.
Static Pool Information: Static pool information as described in Item 1105
of Regulation AB.
Subcontractor: Any vendor, subcontractor or other Person that is not
responsible for the overall servicing (as "servicing" is commonly understood by
participants in the mortgage-backed securities market) of Mortgage Loans but
performs one or more discrete functions identified in Item 1122(d), and
instruction No. 2 of the Instructions to Item 1122, of Regulation AB with
respect to Mortgage Loans under the direction or authority of the Seller or a
Subservicer.
Subservicer: Any Person that services Mortgage Loans on behalf of Seller or
any Subservicer and is responsible for the performance (whether directly or
through Subservicers or Subcontractors) of a substantial portion of the material
servicing functions required to be performed by Seller under this Agreement or
any Reconstitution Agreement that are identified in Item 1122(d) of Regulation
AB.
Subservicing Agreement: An agreement between the Seller and a Subservicer
for the servicing of the Mortgage Loans
Third-Party Originator: Each Person, other than a Qualified Correspondent,
that originated Mortgage Loans acquired by the Seller.
Transfer: A Private Securitization Transaction, Securitization Transaction
or Whole Loan Transfer.
Transferee: The party to whom Purchaser transfers Mortgage Loans pursuant
to a Transfer.
Underwriting Guidelines: The underwriting guidelines of ABN AMRO Mortgage
Group, Inc.
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Whole Loan Transfer: Any sale or transfer of some or all of the Mortgage
Loans by Purchaser to a third party, which sale or transfer is not a
Securitization Transaction.
SECTION 2. Purchase and Conveyance.
On each Closing Date, the Seller, simultaneously with the payment of the
Purchase Price shall execute and deliver to the Purchaser an Assignment and
Conveyance in the form attached hereto as Exhibit 12 with respect to the
Mortgage Loans identified on the related Mortgage Loan Schedule attached
thereto. The sale of the Mortgage Loans by Seller is on a servicing-retained
basis with a servicing fee as set out in the related Commitment Letter.
With respect to each Mortgage Loan purchased, Purchaser shall own and be
entitled to receive: (a) all scheduled principal due after the Cut-off Date, (b)
all other payments and/or recoveries of principal collected after the Cut-off
Date (provided, however, that all scheduled payments of principal due on or
before the Cut-off Date and collected by Seller after the Cut-off Date shall
belong to Seller) and (c) all payments of interest on the Mortgage Loans net of
the Servicing Fee (minus that portion of any such interest payment that is
allocable to the period prior to the Cut-off Date).
For the purposes of this Agreement, payments of scheduled principal and
interest prepaid for a Due Date beyond the Cut-off Date shall not be applied to
reduce the Stated Principal Balance as of the Cut-off Date. Such prepaid amounts
(minus the applicable Servicing Fee) shall be the property of Purchaser. Seller
shall remit for deposit any such prepaid amounts into the Custodial Account,
which account is established for the benefit of Purchaser, for remittance by
Seller to Purchaser on the appropriate Remittance Date. All payments of
principal and interest, less the applicable Servicing Fee, due on a Due Date
following the Cut-off Date shall belong to Purchaser.
SECTION 3. Mortgage Loan Schedule.
Seller shall deliver the final Mortgage Loan Schedule to Purchaser at least
one (1) Business Day prior to the related Closing Date.
SECTION 4. Purchase Price.
Subject to the conditions set forth herein, Purchaser shall pay the
Purchase Price plus accrued interest at the weighted average Mortgage Loan
Remittance Rate from the Cut-off Date through the day prior to the related
Closing Date, both inclusive, to Seller by 5:00 p.m. Eastern Time on the related
Closing Date. Such payment shall be made by wire transfer of immediately
available funds to the account designated by Seller.
SECTION 5. Delivery of Mortgage Loan Documents.
Section 5.01. Possession of Mortgage Files.
The contents of each Mortgage File required to be retained by Seller to
service the Mortgage Loans pursuant to the Agreement, and thus not delivered to
Purchaser, or its designee, are and shall be held by Seller for the benefit of
Purchaser as the owner thereof. Seller's
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possession of any portion of each such Mortgage File is at the will of Purchaser
for the sole purpose of facilitating servicing of the Mortgage Loans pursuant to
the Agreement, and such retention and possession by Seller shall be in a
custodial capacity only. The ownership of each Mortgage Note, Mortgage and the
contents of the Mortgage File is vested in Purchaser and the ownership of all
records and documents with respect to the related Mortgage Loan prepared by or
which come into the possession of Seller shall immediately vest in Purchaser and
shall be retained and maintained by Seller at the will of Purchaser in such
custodial capacity only. The Mortgage File retained by Seller with respect to
each Mortgage Loan pursuant to this Agreement shall be appropriately identified
in Seller's computer system to reflect clearly the sale of such related Mortgage
Loan to Purchaser. Seller shall release from its custody the contents of any
Mortgage File retained by it only in accordance with this Agreement, except when
such release is required in connection with a repurchase of any such Mortgage
Loan pursuant to Section 6.03 or 11.20 of this Agreement or if required under
applicable law or by court order.
Section 5.02. Books and Records.
All rights arising out of the Mortgage Loans, including, but not limited
to, all funds received by Seller after the Cut-off Date on or in connection with
a Mortgage Loan as provided in Section 2, shall be vested in Purchaser;
provided, however, that all such funds received on or in connection with a
Mortgage Loan as provided in Section 2 shall be received and held by Seller for
the benefit of Purchaser as the owner of the Mortgage Loans pursuant to the
terms of this Agreement.
As more fully set forth in Section 20, it is the express intention of the
parties that the transactions contemplated by this Agreement be, and be
construed as, a sale of the Mortgage Loans by Seller and not a pledge of the
Mortgage Loans by Seller to Purchaser to secure a debt or other obligation of
Seller. Consequently, the sale of each Mortgage Loan shall be reflected as a
purchase on Purchaser's business records, tax returns and financial statements,
and as a sale of assets on Seller's business records, tax returns and financial
statements.
Section 5.03. Delivery of Mortgage Loan Documents.
Seller shall, at least five (5) Business Days prior to the related Closing
Date (or such later date as Purchaser may reasonably request or as otherwise set
forth in the related Commitment Letter), deliver, at Seller's expense, and
release to Purchaser, or its designee, the Mortgage Loan Documents with respect
to each Mortgage Loan.
To the extent received by it, Seller shall forward to Purchaser, or its
designee, the Mortgage Loan Documents; provided, however, that Seller shall
provide Purchaser, or its designee, with a true copy of any such document
submitted for recordation, and shall provide the original of any document
submitted for recordation or a copy of such document certified by the
appropriate public recording office to be a true and complete copy of the
original following receipt of the original document by Seller; provided,
further, that such original recorded document or certified copy thereof shall be
delivered to Purchaser no later than one hundred eighty (180) days following the
related Closing Date, unless there has been a delay at the applicable recording
office and Seller has provided evidence of such delay.
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Seller shall make an image of the related Mortgage File available to
Purchaser for examination at Seller's offices or such other location as shall
otherwise be agreed upon by Purchaser and Seller. Such examination may be made
by Purchaser or its designee at any reasonable time prior to the related Closing
Date. Purchaser may, at its option and without notice to Seller, purchase any
Mortgage Loan without conducting any partial or complete examination. The fact
that Purchaser has conducted or has determined not to conduct any partial or
complete examination of the Mortgage Files shall not affect Purchaser's rights
to demand repurchase or other relief or remedy provided for in this Agreement.
Subject to any letter agreement executed between Seller and Purchaser on any
Closing Date with respect to documentation which the parties agree is missing,
if otherwise identified by Purchaser with respect to a Mortgage Loan for which
the Mortgage File is missing documentation as required by the Underwriting
Guidelines, Seller agrees to procure such documentation within thirty (30) days
following Purchaser's notice to Seller that the documentation is missing and if
Seller cannot provide such documentation Seller shall, at Purchaser's option,
repurchase or substitute such Mortgage Loan pursuant to Section 6.03.
SECTION 6. Representations, Warranties and Covenants; Remedies for Breach.
Section 6.01. Representations and Warranties Regarding Individual Mortgage
Loans.
Seller hereby represents and warrants to Purchaser that, as to each
Mortgage Loan, as of the related Closing Date or such other date specified
herein:
(a) The information set forth in the Mortgage Loan Schedule attached to the
related Assignment and Conveyance is true and correct in all material respects;
each Mortgage Loan is in compliance with all requirements set forth in the
Commitment Letter and the characteristics of the Mortgage Loan package as set
forth in the Commitment Letter are all true and correct in all material
respects.
(b) There are no delinquent taxes, ground rents, water charges, sewer
rents, insurance premiums, governmental assessments, leasehold payments or other
outstanding charges affecting the lien priority of the related Mortgage.
(c) The terms of the Mortgage Note and the Mortgage have not been impaired,
waived, altered or modified in any respect, except by written instruments,
recorded in the applicable public recording office if necessary to maintain the
lien priority of the Mortgage, and which have been delivered to Purchaser or its
designee; the substance of any such waiver, alteration or modification has been
approved by the insurer under the Primary Mortgage Insurance Policy, if any, the
title insurer, to the extent required by the related policy, and is reflected on
the Mortgage Loan Schedule. No Mortgagor has been released, in whole or in part,
except in connection with an assumption agreement approved by the insurer under
the Primary Insurance Policy, if any, the title insurer, to the extent required
by the policy, and which assumption agreement has been delivered to the
Custodian and the terms of which are reflected in the related Mortgage Loan
Schedule.
(d) The Mortgage Note and the Mortgage are not subject to any right of
rescission, set-off, counterclaim or defense, including the defense of usury,
nor will the operation of any of
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the terms of the Mortgage Note and 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.
(e) All buildings upon the Mortgaged Property are insured by an insurer
acceptable to the Agency against loss by fire, hazards of extended coverage and
such other hazards as are customary in the area where the Mortgaged Property is
located, pursuant to insurance policies conforming to the requirements of
Section 11.11 of this Agreement. All such insurance policies contain a standard
mortgagee clause naming Seller or the originator of the Mortgage Loan, and its
successors and assigns as mortgagee and all premiums have been paid. If the
Mortgaged Property is in an area identified on a flood hazard map or flood
insurance rate map issued by the Federal Emergency Management Agency as a
special flood hazard area (and such flood insurance has been made available), a
flood insurance policy meeting the requirements of the current guidelines of the
National Flood Insurance Program is in effect and such policy conforms to the
requirements of the Agency. The Mortgage obligates Mortgagor thereunder to
maintain all such insurance at Mortgagor's cost and expense, and on Mortgagor's
failure to do so, authorizes the holder of the Mortgage to maintain such
insurance at Mortgagor's cost and expense and to seek reimbursement therefor
from Mortgagor.
(f) Any and all requirements of any federal, state or local law applicable
to the origination and servicing of the Mortgage Loan, including, without
limitation, fair housing, usury, truth in lending, real estate settlement
procedures, consumer credit protection, equal credit opportunity or disclosure
laws, and predatory, fair and abusive lending laws, have been complied with in
all material respects.
(g) The Mortgage has not been satisfied, canceled, subordinated or
rescinded, and the Mortgaged Property has not been fully released from the lien
of the Mortgage, nor has any instrument been executed that would effect any such
satisfaction, cancellation, subordination, rescission or release.
(h) The Mortgage is a valid, existing and enforceable first lien on the
Mortgaged Property, including all improvements on the Mortgaged Property, except
as enforceability may be limited by bankruptcy, insolvency, liquidation,
receivership, moratorium, reorganization, or other similar laws affecting the
enforcement of the rights of creditors and by general principles of equity,
whether enforcement is sought in a proceeding in equity or at law, and subject
only to (i) the lien of current real property taxes and assessments not yet due
and payable, (ii) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date of recording
being acceptable to mortgage lending institutions which do not adversely affect
the Appraised Value of the Mortgaged Property, and (iii) other matters to which
like properties are commonly subject which do not materially interfere with the
benefits of the security intended to be provided by the Mortgage or the use,
enjoyment, value or marketability of the related Mortgaged Property. Any
security agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates a valid,
existing and enforceable first lien and first priority security interest on the
property described therein and Seller has the full right to sell and assign the
same to Purchaser.
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(i) The Mortgage Note and the related Mortgage are genuine and each is the
legal, valid and binding obligation of the maker thereof, enforceable in
accordance with its terms except as enforceability may be limited by (i)
bankruptcy, insolvency, liquidation, receivership, moratorium, reorganization or
other similar laws affecting the enforcement of the rights of creditors and (ii)
general principles of equity, whether enforcement is sought in a proceeding in
equity or at law.
(j) All parties to the Mortgage Note and the Mortgage had legal capacity to
enter into the Mortgage Loan and to execute and deliver the Mortgage Note and
the Mortgage, and the Mortgage Note and the Mortgage have been duly and properly
executed by such parties. Mortgagor is a natural person or a trust established
in accordance with Agency guidelines.
(k) The proceeds of the Mortgage Loan have been fully disbursed to or for
the account of Mortgagor, and there is no obligation for the Mortgagee to
advance additional funds thereunder, and any and all requirements in connection
with the completion of any on-site or off-site improvement financed with the
proceeds of the Mortgage Loan and in connection with disbursements of any escrow
funds therefor have been complied with. All costs, fees and expenses incurred in
making or closing the Mortgage Loan and the recording of the Mortgage have been
paid, and Mortgagor is not entitled to any refund of any amounts paid or due to
the Mortgagee pursuant to the Mortgage Note or Mortgage.
(l) The Mortgage Loan is covered by an ALTA lender's title insurance policy
or other form of title insurance policy acceptable to the Agency, issued by a
title insurer acceptable to the Agency and qualified to do business in the
jurisdiction where the Mortgaged Property is located, insuring (subject to the
exceptions contained in (h)(i) and (ii) above) Seller and its successors and
assigns as to the first priority lien of the Mortgage in the original principal
amount of the Mortgage Loan and, with respect to any Adjustable Rate Mortgage
Loan, against any loss by reason of the invalidity or unenforceability of the
lien resulting from the provisions of the Mortgage providing for adjustment in
the Mortgage Interest Rate and Monthly Payment. Additionally, such lender's
title insurance policy affirmatively insures ingress and egress to and from the
Mortgaged Property, and against encroachments by or upon the Mortgaged Property
or any interest therein. Seller is the insured under such lender's title
insurance policy, and such lender's title insurance policy is in full force and
effect and will be in full force and effect upon the consummation of the
transactions contemplated by this Agreement. No claims have been made under such
lender's title insurance policy, and Seller has not done, by act or omission,
anything which would impair the coverage of such lender's title insurance
policy.
(m) There is no default, breach, violation or event of acceleration
existing under the Mortgage or the Mortgage Note and no event which, with the
passage of time or with notice and the expiration of any grace or cure period
would constitute a default, breach, violation or event of acceleration, and
Seller has not waived any default, breach, violation or event of acceleration.
(n) The Mortgage Loan was either (A) originated by (i) a savings and loan
association, a savings bank, a commercial bank or similar banking institution
which is supervised and examined by a federal or state authority, or by (ii) a
Mortgagee approved as such by the Secretary of HUD; or (B) purchased by Seller
from an originator, where the Mortgage Loan is underwritten either (i) by Seller
prior to purchase of the Mortgage Loan by Seller, or (ii) by the
15
originator prior to origination, in either case using Seller's Underwriting
Guidelines. Seller is an institution described in subclause (A) (i) or (A) (ii)
above.
(o) Principal payments on the Mortgage Loan commenced no more than sixty
one (61) days after the proceeds of the Mortgage Loan were disbursed. The
Mortgage Note bears interest at the Mortgage Interest Rate. With respect to each
Mortgage Loan, the Mortgage Note is payable on the Due Date in Monthly Payments,
which, in the case of a Fixed Rate Mortgage Loan, are sufficient to fully
amortize the original principal balance over the original term thereof and to
pay interest at the related Mortgage Interest Rate, and, in the case of an
Adjustable Rate Mortgage Loan, are changed on each Adjustment Date, and in any
case, are sufficient to fully amortize the original principal balance over the
original term thereof and to pay interest at the related Mortgage Interest Rate.
The Index for each Adjustable Rate Mortgage Loan is as defined in the Commitment
Letter. The Mortgage Note does not permit negative amortization. No Mortgage
Loan is a Convertible Mortgage Loan.
(p) There is no proceeding pending or, to Seller's knowledge, threatened
for the total or partial condemnation of the Mortgaged Property, nor is such a
proceeding currently occurring, and such property is in good repair and is
undamaged by waste, fire, earthquake or earth movement, windstorm, flood,
tornado or other casualty, so as to materially affect adversely the value of the
Mortgaged Property as security for the Mortgage Loan or the use for which the
premises were intended.
(q) The Mortgage and related Mortgage Note contain customary and
enforceable provisions such as to render the rights and remedies of the holder
thereof adequate for the realization against the Mortgaged Property of the
benefits of the security provided thereby, including (i) in the case of a
Mortgage designated as a deed of trust, by trustee's sale, and (ii) otherwise by
judicial foreclosure, except as enforceability may be limited by bankruptcy,
insolvency, liquidation, receivership, moratorium, reorganization, or other
similar laws affecting the enforcement of the rights of creditors and by general
principles of equity, whether enforcement is sought in a proceeding in equity or
at law. As of the date of origination of the Mortgage Loan, the Mortgaged
Property was not subject to any bankruptcy proceeding or foreclosure proceeding
and Mortgagor has not filed for protection under applicable bankruptcy laws.
Mortgagor has not notified Seller and Seller has no knowledge of any relief
requested or allowed to Mortgagor under the Soldiers and Sailors Civil Relief
Act of 1940.
(r) The Mortgage Note and Mortgage are on forms acceptable to the Agency.
(s) The Mortgage Note is not and has not been secured by any collateral
except the lien of the corresponding Mortgage on the Mortgaged Property.
(t) The Mortgage File contains an appraisal of the related Mortgaged
Property, in a form acceptable to the Agency and was made and signed by a
qualified appraiser, duly appointed by Seller, who had no interest, direct or
indirect in the Mortgaged Property or in any loan made on the security thereof,
whose compensation is not affected by the approval or disapproval of the
Mortgage Loan and who met the minimum Agency qualifications. Each appraisal of
the Mortgage Loan was made in accordance with the relevant provisions of the
Financial Institutions Reform, Recovery, and Enforcement Act of 1989.
16
(u) In the event the Mortgage constitutes 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 the Mortgage, and no fees or expenses
are or will become payable by Purchaser to the trustee under the deed of trust,
except in connection with a trustee's sale after default by Mortgagor.
(v) The Mortgage Loan is not a graduated payment mortgage loan and the
Mortgage Loan does not have a shared appreciation or other contingent interest
feature. Any Mortgage Loan which contains provisions pursuant to which Monthly
Payments are (a) paid or partially paid with funds deposited in any separate
account established by the Seller, Mortgagor, or anyone on behalf of Mortgagor,
(b) paid by any source other than Mortgagor or (c) which contains any other
similar provisions which may constitute a "buydown" provision has been
originated in accordance with the Seller's Underwriting Guidelines.
(w) All material disclosures required by applicable law with respect to the
making of mortgage loans of the same type as the Mortgage Loan have been made
and delivered, including rescission materials required by applicable law if the
Mortgage Loan is a Refinanced Mortgage Loan.
(x) Each Mortgage Loan with an LTV at origination in excess of 80% will be
subject to a Primary Mortgage Insurance Policy, issued by an insurer acceptable
to the Agency, in at least such amounts as are required by the Agency. All
provisions of such Primary Mortgage Insurance Policy have been and are being
complied with, such policy is in full force and effect, and all premiums due
thereunder have been paid. Any Mortgage subject to any such Primary Mortgage
Insurance Policy obligates Mortgagor thereunder to maintain such insurance and
to pay all premiums and charges in connection therewith unless terminable in
accordance with the Agency standards or applicable law. The Mortgage Interest
Rate for the Mortgage Loan does not include any such insurance premium.
(y) As of the date of origination of the Mortgage Loan, no improvement
located on or part of the Mortgaged Property was in violation of any zoning law
or regulation.
(z) The Assignment of Mortgage is in recordable form and is acceptable for
recording under the laws of the jurisdiction in which the Mortgaged Property is
located.
(aa) All payments required to be made prior to the Cut-off Date for such
Mortgage Loan under the terms of the Mortgage Note have been made.
(bb) The origination and collection practices used by Seller with respect
to each Mortgage Note and Mortgage have been in all material respects legal and
customary in the mortgage origination and servicing industry. The Mortgage Loan
has been serviced by Seller in accordance with the terms of the Mortgage Note
and Mortgage. All escrow deposits and Escrow Payments, if any, are in the
possession of, or under the control of, Seller have been handled in accordance
with the Real Estate Settlement Procedures Act ("RESPA"). If such Mortgage Loan
provides that the interest rate on the principal balance of the Mortgage Note
may be adjusted, all of the terms of the Mortgage Note pertaining to interest
rate adjustments, payment adjustments and adjustments of the outstanding
principal balance are enforceable (except as enforceability
17
may be limited by bankruptcy, insolvency, liquidation, receivership, moratorium,
reorganization, or other similar laws affecting the enforcement of the rights of
creditors and by general principles of equity, whether enforcement is sought in
a proceeding in equity or at law), all such adjustments have been properly made,
including any required notices, and such adjustments do not and will not affect
the priority of the Mortgage lien.
(cc) Immediately prior to the payment of the Purchase Price, Seller was the
sole legal, beneficial and equitable owner and holder of the Mortgage Loans and
upon the payment of the Purchase Price by Purchaser, in the event that Seller
retains record title, Seller shall retain such record title to each Mortgage,
each related Mortgage Note and the related Mortgage Files with respect thereto
for Purchaser as the owner thereof and only for the purpose of servicing and
supervising the servicing of each Mortgage Loan. The Mortgage Loan was not
assigned or pledged by Seller and Seller had good and marketable title thereto,
and Seller had full right to transfer and sell the Mortgage Loan to Purchaser
free and clear of any encumbrance, participation interest, lien, equity, pledge,
claim or security interest and had full right and authority, subject to no
interest or participation in, or agreement with, any other party to sell or
otherwise transfer the Mortgage Loan.
(dd) The Mortgage Loan was underwritten in accordance with the Underwriting
Guidelines in effect at the time of origination with exceptions thereto
exercised in a reasonable manner.
(ee) With respect to Mortgage Loans that are secured by a leasehold estate,
the lease is valid, in full force and effect, and conforms to Agency standards
and the Underwriting Guidelines for leasehold estates.
(ff) The Mortgaged Property is located in the state identified in the
Mortgage Loan Schedule and consists of a parcel of real property with a detached
single family residence, or a two-to-four-family dwelling erected thereon, or an
individual condominium unit, or an individual unit in a planned unit
development; provided, however, that any condominium project or planned unit
development generally conforms with the Underwriting Guidelines and the
eligibility requirements of the Agency regarding such dwellings, and no
residence or dwelling is a cooperative or manufactured or mobile home.
(gg) Seller used no adverse selection procedures in selecting the Mortgage
Loan from among the first-lien residential mortgage loans owned by it which were
available for inclusion in the Mortgage Loans.
(hh) All payments required to be made up to the close of business on the
related Closing Date for such Mortgage Loan under the terms of the Mortgage Note
have been made; Seller has not advanced funds, or induced, solicited or
knowingly received any advance of funds from a party other than the owner of the
related Mortgaged Property, directly or indirectly, for the payment of any
amount required by the Mortgage Note or Mortgage; and there has been no
delinquency, exclusive of any period of grace, in any payment by Mortgagor
thereunder during the last twelve months.
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(ii) All parties which have had any interest in the Mortgage Loan, whether
as mortgagee, assignee, pledgee or otherwise, are (or, during the period in
which they held and disposed of such interest, were) in compliance with any and
all applicable "doing business" and licensing requirements of the laws of the
state wherein the Mortgaged Property is located.
(jj) There are no mechanics' or similar liens or claims which have been
filed for work, labor or material affecting the related Mortgaged Property which
are or may be liens prior to, or equal or coordinate with, the lien of the
related Mortgage.
(kk) All improvements lay wholly within the boundaries and building
restriction lines of the Mortgaged Property, and no improvements on adjoining
properties encroach upon the Mortgaged Property.
(ll) The Mortgage Loan was not made in connection with (a) the construction
or rehabilitation of a Mortgaged Property, other than a
construction-to-permanent loan which has converted to a permanent Mortgage Loan
in accordance with Agency standards or (b) facilitating the trade-in or exchange
of a Mortgaged Property.
(mm) As of the date of origination of the Mortgage Loan, the Mortgaged
Property was lawfully occupied under applicable law; all inspections, licenses
and certificates required to be made or issued with respect to all occupied
portions of the Mortgaged Property and, with respect to the use and occupancy of
the same, including but not limited to certificates of occupancy, have been made
or obtained from the appropriate authorities.
(nn) No error, omission, misrepresentation, negligence, fraud or similar
occurrence with respect to a Mortgage Loan has taken place on the part of Seller
or Mortgagor, or, to the best of Seller's knowledge, on the part of any
appraiser, any builder or developer, or any other party involved in the
origination of the Mortgage Loan or in the application of any insurance in
relation to such Mortgage Loan.
(oo) Any principal advances made to Mortgagor prior to the Cut-off Date
have been consolidated with the outstanding principal amount secured by the
Mortgage, and the secured principal amount, as consolidated, bears a single
interest rate and single repayment term. The lien of the Mortgage securing the
consolidated principal amount is expressly insured as having first lien priority
by a title insurance policy, an endorsement to the policy insuring the
mortgagee's consolidated interest or by other title evidence acceptable to the
Agency. The consolidated principal amount does not exceed the original principal
amount of the Mortgage Loan.
(pp) The Mortgage Loan does not have a balloon payment feature.
(qq) Interest on each Mortgage Loan is calculated on the basis of a 360-day
year consisting of twelve 30-day months.
(rr) At the time of origination, the Mortgage Loan (a) was not classified
as "high cost" loan under the Home Ownership and Equity Protection Act of 1994,
as amended ("HOEPA"), any regulations promulgated thereunder, or any applicable
state or local law or ordinance, or had an "annual percentage rate" or "total
points and fees" payable by the borrower (as each such
19
term is defined under HOEPA) that equaled or exceeded the applicable thresholds
defined under HOEPA (Section 32 of Regulation Z, 12 C.F.R. Section 32(a)(1)(i)
and (ii)), (b) did not include any single-premium credit-life or accident and
health insurance or credit unemployment, credit property or credit disability
insurance, and (c) did not contain any term or condition, or involve any loan
origination practice, that has been defined as "predatory" or "threshold" under
applicable federal, state or local law, or which has been expressly categorized
as an "unfair" or "deceptive" term, condition, or practice in any applicable
federal, state or local law dealing with "predatory" or "high cost" mortgage
lending.
(ss) Seller has delivered and released to Purchaser or Purchaser's agent
the Mortgage Loan Documents for each Mortgage Loan.
(tt) The Mortgage Loan has a life of loan tax service contract; and, upon
termination of Seller as servicer for cause pursuant to the Agreement, Seller
shall either assign the tax service contract for that Mortgage Loan to Purchaser
at no cost to Purchaser; or, if that tax service contract is not assignable,
Seller shall reimburse Purchaser the reasonable cost of a replacement tax
service contract for that Mortgage Loan with a nationally recognized tax service
contract provider.
(uu) The Mortgage Loan has a life of loan flood zone service contract; and
upon termination of Seller as servicer for cause pursuant to the Agreement,
Seller shall either assign the flood zone service contract for that Mortgage
Loan to Purchaser at no cost to Purchaser; or, if that flood zone service
contract is not assignable, Seller shall reimburse Purchaser the reasonable cost
of a replacement flood zone service contract for that Mortgage Loan with a
nationally recognized flood zone service provider.
(vv) The Mortgage Loan is not subject to any Prepayment Charges.
(ww) The Mortgage Loan did not have a LTV or a CLTV in excess of 95% at
origination.
(xx) If the Mortgage Loan had an original principal balance on the day of
origination which was less than or equal to the applicable conforming loan limit
established by the Agency, and was originated or modified on or after October 1,
2002 and prior to March 7, 2003, it is not secured by a Mortgaged Property
located in the State of Georgia; if the Mortgage Loan was originated or modified
on or after March 7, 2003, the Mortgage Loan is not a "high cost home loan" as
defined under the Georgia Fair Lending Act (OGCA Sections 7 6A 1, et. seq.), as
amended.
(yy) The Mortgage Loan does not have an original term to maturity of more
than thirty (30) years.
(zz) The 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 Mortgaged Property is sold without the prior consent of the mortgagee
thereunder.
(aaa) Seller has fully furnished, in accordance with the Fair Credit
Reporting Act and its implementing regulations, accurate and complete
information (e.g., favorable and
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unfavorable) on its borrower credit files to Equifax, Experian and Trans Union
Credit Information Company (three of the credit repositories), on a monthly
basis.
(bbb) [RESERVED]
(ccc) As of the required compliance dates, Seller has (i) complied with all
applicable anti-money laundering laws and regulations, including without
limitation the USA Patriot Act of 2001 and the Bank Secrecy Act (collectively,
the "Anti-Money Laundering Laws"); (ii) established an anti-money laundering
compliance program as required by the Anti-Money Laundering Laws; (iii)
conducted the requisite due diligence in connection with the origination of each
Mortgage Loan for purposes of the Anti-Money Laundering Laws, including
identification and verification of the Mortgagor's identity and, where
appropriate, the source of the Mortgagor's funds; and (iv) maintained, and will
maintain, sufficient information to identify the applicable Mortgagor for
purposes of the Anti-Money Laundering Laws. No Mortgage Loan is subject to
nullification pursuant to Executive Order 13224 (the "Executive Order") or the
regulations promulgated by the Office of Foreign Assets Control of the United
States Department of the Treasury (the "OFAC Regulations") or in violation of
the Executive Order or the OFAC Regulations, and no Mortgagor is subject to the
provisions of such Executive Order or the OFAC Regulations nor listed as a
"blocked person" for purposes of the OFAC Regulations.
(ddd) The Mortgage Loan, if originated or modified on or after November 27,
2003 and prior to July 6, 2004, is not secured by a Mortgaged Property located
in the State of New Jersey and classified as a "covered loan".
(eee) The Mortgagor was not required to purchase any single premium credit
insurance policy (e.g., life, mortgage, disability, accident, unemployment,
property or health insurance product) or debt cancellation agreement as a
condition of obtaining the extension of credit. Mortgagor did not obtain a
prepaid single premium credit insurance policy (e.g., life, mortgage,
disability, accident, unemployment, property or health insurance product) or
debt cancellation agreement in connection with the origination of the Mortgage
Loan; and no proceeds from the Mortgage Loan were used to purchase single
premium credit insurance policies (e.g., life, mortgage, disability, accident,
unemployment, property or health insurance product) or debt cancellation
agreements as part of the origination of, or as a condition to closing, the
Mortgage Loan.
(fff) Any interest required to be paid on an Escrow Account by state and
/or local law has been paid and credited; the escrow of funds is not prohibited
by applicable law and is in an amount sufficient to pay all items for which
assessments have been made but remain unpaid. No escrow deposits or other
charges or payments due Seller have been capitalized under any Mortgage or
Mortgage Note.
(ggg) The Mortgagor was not encouraged or required to select a Mortgage
Loan product offered by the Mortgage Loan's originator which is a higher cost
product designed for less creditworthy borrowers, taking into account such facts
as, without limitation, the mortgage loan's requirements and the Mortgagor's
credit history, income, assets and liabilities. If Mortgagor sought financing
through a Mortgage Loan originator's higher-priced subprime lending channel,
Mortgagor was directed towards or offered the Mortgage Loan originator's
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standard mortgage line if Mortgagor was able to qualify for one of the standard
products. If, at the time of the related loan application, the Mortgagor may
have qualified for a lower cost credit product then offered by any mortgage
lending affiliate of the Seller, the Seller referred the Mortgagor's application
to such affiliate for underwriting consideration.
(hhh) [RESERVED]
(iii) All points, fees and charges, including finance charges (whether or
not financed, assessed, or collected), in connection with the origination and
servicing of any Mortgage Loan were disclosed in writing to the related
Mortgagor if required by applicable state and federal law and regulation and no
related Mortgagor was charged "points and fees" (whether or not financed) in an
amount that exceeds the greater of (1) 5% of the principal amount of such loan
or (2) $1,000. For the purposes of this representation, "points and fees" (a)
include origination, underwriting, broker and finder's fees and charges that the
lender imposed as a condition of making the Mortgage Loan, whether they are paid
to the lender or a third party; and (b) exclude bona fide discount points, fees
paid for actual services rendered in connection with the origination of the
Mortgage Loan (such as attorneys' fees, notaries fees and fees paid for property
appraisals, credit reports, surveys, title examinations and extracts, flood and
tax certifications, and home inspections) and the cost of mortgage insurance or
credit-risk price adjustments; the costs of title, hazard, and flood insurance
policies; state and local transfer taxes or fees; escrow deposits for the future
payment of taxes and insurance premiums; and other miscellaneous fees and
charges which miscellaneous fees and charges, in total, do not exceed 0.25
percent of the loan amount).
(jjj) The Seller will transmit full-file credit reporting data for each
Mortgage Loan pursuant to ▇▇▇▇▇▇ ▇▇▇ Guide Announcement 95-19 and for each
Mortgage Loan, Seller agrees it shall report one of the following statuses each
month as follows: new origination, current, delinquent (30-, 60-, 90-days,
etc.), foreclosed, or charged-off.
(kkk) Neither the Mortgage nor the Mortgage Note requires the Mortgagor to
submit to arbitration to resolve any dispute arising out of or relating in any
way to the Mortgage Loan transaction.
(lll) If the Mortgage Loan is secured by a Mortgaged Property located
within the "Pilot Program Area" in ▇▇▇▇ County in the State of Illinois, the
Mortgage Loan was originated in compliance with Illinois Public Act 94-280
(Illinois H.B. 4050), known as the Predatory Lending Database Pilot Program Act
(765 ILCS 77/70)); and the Mortgage, if recorded on or after September 1, 2006,
was validly recorded with the ▇▇▇▇ County Recorder of Deeds along with either a
Certificate of Compliance or an Exempt Certificate issued by the Illinois
Department of Financial and Professional Regulation as a cover sheet; and no
material changes were made to any such Mortgage Loan from the time that the loan
file was submitted to the Illinois Department of Financial and Professional
Regulation for a Certificate of Compliance or Exempt Certificate until the date
of settlement. The term "Pilot Program Area" refers to the following zip codes:
60620, 60621, 60623, 60628, 60629, 60632, 60636, 60638, 60643, and 60652.
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(mmm) The Mortgage Loan is in compliance with the anti-predatory lending
eligibility for purchase requirements of ▇▇▇▇▇▇ Mae's Selling Guide.
Section 6.02. Representations of Seller.
Seller hereby represents and warrants to Purchaser that as to itself, as of
the related Closing Date:
(a) It is a Delaware corporation duly organized, validly existing, and in
good standing under the laws of the state of its incorporation and has all
licenses necessary to carry on its business as now being conducted and is
qualified and in good standing in the states where the Mortgaged Property is
located if the applicable laws require qualification in order to conduct
business of the type conducted by it. It has corporate power and authority to
execute and deliver this Agreement and to perform in accordance herewith; the
execution, delivery and performance of this Agreement (including all instruments
of transfer to be delivered pursuant to this Agreement) by it and the
consummation of the transactions contemplated hereby have been duly and validly
authorized. This Agreement, assuming due authorization, execution and delivery
by Purchaser, evidences the valid, binding and enforceable obligation of it,
subject to applicable law except as enforceability may be limited by (i)
bankruptcy, insolvency, liquidation, receivership, moratorium, reorganization or
other similar laws affecting the enforcement of the rights of creditors and (ii)
general principles of equity, whether enforcement is sought in a proceeding in
equity or at law. All requisite corporate action has been taken by it to make
this Agreement valid and binding upon it in accordance with its terms.
(b) No consent, approval, authorization or order is required for the
transactions contemplated by this Agreement from any court, governmental agency
or body, or federal or state regulatory authority having jurisdiction over it,
or, if required, such consent, approval, authorization or order has been or
will, prior to the related Closing Date, be obtained.
(c) The consummation of the transactions contemplated by this Agreement are
in Seller's ordinary course of business and will not result in the breach of any
term or provision of its charter or by-laws or result in the breach of any term
or provision of, or conflict with or constitute a default under or result in the
acceleration of any obligation under, any agreement, indenture or loan or credit
agreement or other instrument to which it or its property is subject, or result
in the violation of any law, rule, regulation, order, judgment or decree to
which the it or its property is subject.
(d) The transfer, assignment and conveyance of the Mortgage Notes and the
Mortgages by it pursuant to this Agreement are not subject to the bulk transfer
or any similar statutory provisions in effect in any applicable jurisdiction.
(e) There is no action, suit, proceeding or investigation pending or, to
its knowledge, threatened against it which, either individually or in the
aggregate, would likely result in any material adverse change in the business,
operations, financial condition, properties or assets of it, or in any material
impairment of the right or ability of it to carry on its business substantially
as now conducted or which would draw into question the validity of this
Agreement or the Mortgage Loans or of any action taken or to be taken in
connection with the obligations of it
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contemplated herein, or which would materially impair the ability of it to
perform under the terms of this Agreement.
(f) Seller is an Agency approved lender in good standing and is either a
savings and loan association, a savings bank, a commercial bank, credit union,
insurance company or an institution which is supervised and examined by a
federal or state authority, or a mortgagee approved by the Secretary of Housing
and Urban Development pursuant to Sections 203 and 211 of the National Housing
Act (a "HUD Approved Mortgagee").
(g) Seller does not believe, nor does it have any reason or cause to
believe, that it cannot perform each and every covenant contained in this
Agreement.
(h) Seller is not in violation of, and the execution and delivery of this
Agreement by Seller and its performance and compliance with the terms of this
Agreement will not constitute a violation with respect to, any order or decree
of any court or any order or regulation of any federal, state, municipal or
governmental agency having jurisdiction over Seller or its assets, which
violation might have consequences that would materially and adversely affect the
condition (financial or otherwise) or the operation of Seller or its assets or
might have consequences that would materially and adversely affect the
performance of its obligations and duties hereunder.
Section 6.03. Remedies for Breach of Representations and Warranties.
It is understood and agreed that the representations and warranties set
forth in Sections 6.01 and 6.02 shall survive the sale of the Mortgage Loans to
Purchaser and shall inure to the benefit of Purchaser and its permitted assigns,
notwithstanding any restrictive or qualified endorsement on any Mortgage Note or
Assignment of Mortgage or the examination or lack of examination of any Mortgage
File. Upon discovery by either Seller or Purchaser of a breach of any of the
foregoing representations and warranties which materially and adversely affects
the value of the Mortgage Loans or the interest of Purchaser therein (or which
materially and adversely affects the interest of Purchaser in or the value of
the related Mortgage Loan in the case of a representation and warranty relating
to a particular Mortgage Loan), the party discovering such breach shall give
prompt written notice to the other party.
Within ninety (90) days of the earlier of either discovery by or notice to
Seller of any breach of a representation or warranty which materially and
adversely affects the value of a Mortgage Loan or the Mortgage Loans or the
interest of Purchaser therein, Seller shall at its discretion either cure such
breach in all material respects or repurchase such Mortgage Loan or Mortgage
Loans at the Repurchase Price or at the price set forth in the last paragraph of
this Section 6.03, as applicable. However, if mutually agreeable to Seller and
Purchaser, Seller, rather than repurchase the Mortgage Loan as provided above,
may remove such Mortgage Loan and substitute in its place a Qualified Substitute
Mortgage Loan or Loans; provided, however, that any such substitution shall be
effected not later than one hundred eighty (180) days after the related Closing
Date. If Seller has no Qualified Substitute Mortgage Loan, it shall repurchase
the deficient Mortgage Loan. Any repurchase of a Mortgage Loan pursuant to the
foregoing provisions of this Section 6.03 shall occur on a date designated by
Purchaser and acceptable to Seller, and shall be accomplished by Seller
depositing the amount of the Repurchase Price in the
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Custodial Account for distribution to Purchaser on the next scheduled Remittance
Date. Notwithstanding anything to the contrary contained herein, it is
understood by the parties hereto that a breach of the representations and
warranties made in Subsections 6.01(f), (ff), (rr), (vv), (xx), (aaa), (eee),
(ggg), (iii) or (kkk) will be deemed to materially and adversely affect the
value of the related Mortgage Loan or the interest of the Purchaser therein.
At the time of repurchase of any Mortgage Loan (or removal of any Deleted
Mortgage Loan), Purchaser and Seller shall arrange for the assignment of the
repurchased Mortgage Loan (or Deleted Mortgage Loan) to Seller or its designee
and the delivery to Seller of any documents held by Purchaser relating to the
repurchased Mortgage Loan in the manner required by this Agreement with respect
to the purchase and sale of such Mortgage Loan on the related Closing Date.
As to any Deleted Mortgage Loan for which Seller substitutes one or more
Qualified Substitute Mortgage Loans, Seller shall effect such substitution by
delivering to Purchaser, or its designee, for each Qualified Substitute Mortgage
Loan the Mortgage Loan Documents. Seller shall remit to the Custodial Account
the Monthly Payment less the Servicing Fee due on each Qualified Substitute
Mortgage Loan in the month following the date of such substitution. Monthly
Payments due with respect to Qualified Substitute Mortgage Loans in the month of
substitution will be retained by Seller. For the month of substitution,
distributions to Purchaser will include the Monthly Payment due on such Deleted
Mortgage Loan in the month of substitution, and Seller shall thereafter be
entitled to retain all amounts subsequently received by Seller in respect of
such Deleted Mortgage Loan. Seller shall give written notice to Purchaser that
such substitution has taken place. Upon such substitution, each Qualified
Substitute Mortgage Loan shall be subject to the terms of this Agreement in all
respects, and Seller shall be deemed to have made with respect to such Qualified
Substitute Mortgage Loan, as of the date of substitution, the covenants,
representations and warranties set forth in Sections 6.01 and 6.02, and Seller
shall have no further liability or obligation to Purchaser for the Deleted
Mortgage Loan other than with respect to its indemnification obligations
hereunder.
For any month in which Seller substitutes one or more Qualified Substitute
Mortgage Loans for one or more Deleted Mortgage Loans, Seller will determine the
amount (if any) by which the aggregate principal balance of all such Qualified
Substitute Mortgage Loans as of the date of substitution is less than the
aggregate Stated Principal Balance of all such Deleted Mortgage Loans (after
application of scheduled principal payments due in the month of substitution).
The amount of such shortfall shall be remitted for distribution by Seller to
Purchaser in the month of substitution pursuant to Section 11.05. Accordingly,
on the date of such substitution, Seller shall remit from its own funds for
deposit into the Custodial Account an amount equal to the amount of such
shortfall plus one month's interest thereon at the Mortgage Loan Remittance
Rate.
If within three (3) months of the related Closing Date, Seller receives
written notice from Purchaser that it has breached a representation or warranty
set forth in Sections 6.01 or 6.02, which materially and adversely affects the
value of the Mortgage Loan or the interest of Purchaser therein, and Seller
within sixty (60) days after receipt of such notices does not cure such breach
or, if mutually agreeable to Seller and Purchaser, substitute a Qualified
Substitute Mortgage Loan satisfactory to Purchaser, then Seller shall repurchase
the Mortgage Loan
25
pursuant to the provisions of this Section at a price equal to the outstanding
principal balance at the time of repurchase, times the percentage of par set
forth in the Commitment Letter related to that Mortgage Loan, plus any accrued
and unpaid interest thereon to the last day of the month in which such
repurchase occurs.
If the Mortgagor is thirty (30) days or more delinquent with respect to the
first Monthly Payment due to the Purchaser after the related Closing Date and if
Purchaser within ninety (90) days after the related Closing Date delivers to
Seller a written request to repurchase the Mortgage Loan, Seller shall
repurchase such Mortgage Loan at a price equal to the outstanding principal
balance at the time of repurchase, times the percentage of par set forth in the
Commitment Letter related to that Mortgage Loan, plus any accrued and unpaid
interest thereon to the last day of the month in which such repurchase occurs.
Seller shall not be required to repurchase that Mortgage Loan if, within thirty
(30) days of the receipt of such written request, it can demonstrate to
Purchaser's reasonable satisfaction that the related Mortgagor timely made all
payments required of Mortgagor but that such payment was otherwise misapplied.
Section 6.04. Indemnification.
Seller agrees to indemnify and hold Purchaser harmless from and against any
actual losses, damages, actions or liabilities, including reasonable legal fees
caused by any material breach of any representation or warranty contained in
Sections 6.01 and 6.02 hereof.
If Purchaser seeks indemnification under this Section 6.04, it must
promptly give Seller notice of any legal action or potential claim. However,
delay or failure by Purchaser to provide such notice shall not release Seller
from any indemnity obligations, except and only to the extent that Seller shows
that such delay or failure materially prejudiced the defense of such action or
materially increased the amount of such claim. Seller shall be responsible to
conduct such defense through counsel reasonably satisfactory to Purchaser;
provided, however, that Seller is permitted to control fully the defense of any
such claim and to settle any such claim subject to Purchaser's approval, which
approval shall not be unreasonably withheld; provided further that Purchaser
shall have the right to retain counsel to represent it at its expense in
connection with any such claim. If Seller fails to assume the defense of an
action within twenty (20) days after receiving notice, then Seller shall be
bound by any determination made in the action or by any compromise or settlement
Purchaser may effect. Without the consent of the other party, neither Purchaser
nor Seller shall agree to any settlement if the matter involves any possible
criminal action or proceeding, or contains a stipulation to, or admission or
acknowledgment of, any wrongdoing (in tort or otherwise) on the part of the
other party, and the settlement of any such matter without the prior written
consent of the other party shall be void and of no effect with respect to that
other party. Purchaser agrees to use reasonable efforts to mitigate any claims
tendered to Seller. Purchaser shall assign to Seller all of its claims for
recovery against third parties for any indemnification provided by Seller,
whether such claims arise pursuant to insurance coverage, contribution,
subrogation or otherwise.
Any action against Seller relating to or arising out of the breach of any
representations and warranties made in Sections 6.01 or 6.02 shall accrue as to
any Mortgage Loan upon (i) discovery of such breach by Purchaser or notice
thereof by Seller to Purchaser, (ii) failure by
26
Seller to cure such breach, repurchase or substitute such Mortgage Loan as
specified above, and (iii) demand upon Seller by Purchaser for compliance with
the terms of this Agreement.
It is understood and agreed that the obligations of Seller set forth in
Section 5.03 and 6.03 to cure, repurchase or substitute for a defective Mortgage
Loan, or in Section 6.04 to indemnify Purchaser, constitute the sole remedies of
Purchaser respecting a breach of the representations and warranties set forth in
Sections 6.01 and 6.02.
SECTION 7. Intentionally Omitted.
SECTION 8. Closing.
The closing for the purchase and sale of the Mortgage Loans shall take
place on the related Closing Date. The closing shall be by telephone, confirmed
by letter or wire as the parties shall agree. The closing shall be subject to
each of the following conditions:
(a) all of the representations and warranties of Seller in this Agreement
shall be true and correct as of the related Closing Date;
(b) Purchaser shall have received, or Purchaser's attorneys shall have
received in escrow, all Closing Documents as specified in Section 9, in such
forms as are agreed upon and acceptable to Purchaser, duly executed by all
signatories as required pursuant to the terms hereof;
(c) Seller shall have complied with all other material terms and conditions
of this Agreement, or such compliance has been waived by Purchaser; and
(d) Seller shall have received the Purchase Price.
SECTION 9. Closing Documents.
On or before the initial Closing Date, the Seller shall deliver to the
Purchaser, or Purchaser's attorneys in escrow, the following documents:
(i) this Agreement, executed by the Seller;
(ii) an Officer's Certificate, in the form of Exhibit 3 hereto;
(iii) an opinion of counsel to the Seller, in the form of Exhibit
4 hereto;
(iv) a Custodial Account Certification in the form of Exhibit 5
hereto;
(v) an Escrow Account Certification in the form of Exhibit 6
hereto; and
(vi) evidence of the Payment Clearing Account.
2. The Closing Documents for the Mortgage Loans to be purchased on each
Closing Date (including the initial Closing Date) shall consist of the following
documents:
(i) the related Commitment Letter; and
27
(ii) an Assignment and Conveyance, in the form of Exhibit 12
hereto, including the related Mortgage Loan Schedule
attached thereto.
SECTION 10. Costs.
Purchaser shall pay the fees and expenses of its due diligence, the legal
fees and expenses of its attorneys, the costs and expenses incurred in
connection with the recording of assignments of mortgage from Seller, and the
fees and expenses of its custodian, if any. Seller shall pay the costs and
expenses incurred in connection with the initial transfer and delivery of the
Mortgage Loan Documents hereunder and the legal fees and expenses of its
attorneys.
SECTION 11. Administration and Servicing of the Mortgage Loans.
Section 11.01. Seller to Act as Servicer.
Seller shall service and administer the Mortgage Loans in accordance with
this Agreement and Customary Servicing Procedures and the terms of the Mortgage
Notes and Mortgages, and shall have full power and authority, acting alone or
through sub-servicers or agents, to do or cause to be done any and all things in
connection with such servicing and administration which Seller may deem
necessary or desirable and consistent with the terms of this Agreement. Seller
may perform its servicing responsibilities through agents, subcontractors or
independent contractors, but shall not thereby be released from any of its
responsibilities hereunder.
Consistent with the terms of this Agreement, Seller may waive, modify or
vary any term of any Mortgage Loan or consent to the postponement of strict
compliance with any such term or in any manner grant indulgence to any
Mortgagor; provided, however, that (unless Mortgagor is in default with respect
to the Mortgage Loan, or such default is, in the judgment of Seller, imminent,
and Seller has the consent of Purchaser) Seller shall not, unless authorized by
Purchaser, permit any modification with respect to any Mortgage Loan that would
change the Mortgage Interest Rate, defer or forgive the payment of any principal
or interest, change the outstanding principal amount (except for actual payments
of principal), make any future advances or extend the final maturity date, as
the case may be, with respect to such Mortgage Loan. Without limiting the
generality of the foregoing, Seller in its own name or acting through
sub-servicers or agents is hereby authorized and empowered by Purchaser when
Seller believes it appropriate and reasonable in its judgment, to execute and
deliver, on behalf of itself and Purchaser, all instruments of satisfaction or
cancellation, or of partial or full release, discharge and all other comparable
instruments, with respect to the Mortgage Loans and the Mortgaged Properties and
to institute foreclosure proceedings or obtain a deed-in-lieu of foreclosure so
as to convert the ownership of such properties, and to hold or cause to be held
title to such properties, on behalf of Purchaser pursuant to the provisions of
Section 11.14. Seller shall make all required Servicing Advances, shall service
and administer the Mortgage Loans in accordance with applicable state and
federal law, and shall provide to Mortgagors any reports required to be provided
to them hereunder. Purchaser shall furnish to Seller any powers of attorney and
other documents reasonably necessary or appropriate to enable Seller to carry
out its servicing and administrative duties under this Agreement.
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The Seller will fully furnish, in accordance with the Fair Credit Reporting
Act and its implementing regulations, accurate and complete information (e.g.,
favorable and unfavorable) on its borrower credit files to Equifax, Experian and
Trans Union Credit Information Company (three of the credit repositories), on a
monthly basis.
With respect to each Mortgagor, the Seller will monitor applicable sanction
lists pursuant to, and in accordance with, the Anti-Money Laundering Laws,
including to determine whether any Mortgagor becomes listed as a "blocked
person" for purposes of the OFAC Regulations. In the event a Mortgagor is listed
as a "blocked person", the Seller shall promptly notify the Purchaser.
Section 11.02. Liquidation of Mortgage Loans.
In the event that any payment due under any Mortgage Loan is not paid when
the same becomes due and payable, or in the event Mortgagor fails to perform any
other covenant or obligation under the Mortgage Loan and such failure continues
beyond any applicable grace period, Seller shall take such action as it shall
deem to be in the interest of Purchaser. In the event that any payment due under
any Mortgage Loan remains delinquent for such period as provided in the
Servicing Guidelines, Seller shall commence foreclosure proceedings in
accordance with the guidelines set forth by the Agency. In such connection,
Seller shall from its own funds make all necessary and proper Servicing
Advances. If the portion of any Liquidation Proceeds or REO Disposition Proceeds
allocable as a recovery of interest on any Mortgage Loan is less than the full
amount of accrued and unpaid interest on such Mortgage Loan as of the date such
proceeds are received, then the Servicing Fees and Servicing Advances shall be
paid first and any amounts remaining thereafter shall be distributed to
Purchaser.
Section 11.03. Collection of Mortgage Loan Payments.
Continuously from the date hereof until the principal and interest on all
Mortgage Loans are paid in full, Seller will proceed diligently, in accordance
with this Agreement, to collect all payments due under each of the Mortgage
Loans when the same shall become due and payable, in accordance with the
Servicing Guidelines. Further, Seller will in accordance with RESPA and all
applicable state law ascertain and estimate taxes, assessments, fire and hazard
insurance premiums, premiums for Primary Mortgage Insurance Policies, and all
other charges that, as provided in any Mortgage, will become due and payable.
Section 11.04. Establishment of Payment Clearing Accounts.
(a) Seller shall maintain one or more Payment Clearing Accounts for the
deposit of all funds collected in connection with the Mortgage Loans. Seller
shall deposit in the Payment Clearing Account prior to the opening of business
on the Business Day following the day on which such amounts are received by
Seller, all payments and collections received in connection with the Mortgage
Loans subsequent to the Cut-off Date or prior to the Cut-off Date but allocable
to a period subsequent to such date. Seller shall transfer funds deposited into
the Payment Clearing Account to the Custodial Accounts and Escrow Accounts, as
provided in Sections 11.05 and 11.07, within twenty-four (24) hours.
29
(b) Seller shall segregate and hold all funds collected and received in
connection with the Mortgage Loans separate and apart from any of its own funds
and general assets. Seller's account agreement for each Payment Clearing Account
shall provide that such account is a special deposit, required to be segregated
and held by the depository institution maintaining such account in a fiduciary
capacity, separate and apart from the institution's own funds and general assets
and that the account shall not be held in any capacity that would create a
debtor-creditor relationship between the institution and Seller or Purchaser. At
all times, Purchaser shall be the sole beneficial owner of the funds in the
Payment Clearing Accounts received in connection with the Mortgage Loans and
Seller's possession or control of any such funds shall be solely in Seller's
capacity as collecting agent for Purchaser.
Section 11.05. Establishment of Custodial Accounts; Deposits in Custodial
Accounts.
(a) Seller shall establish and maintain one or more Custodial Accounts for
the deposit of funds specified in Section 11.05(b) collected in connection with
the Mortgage Loans.
(b) Seller shall transfer the following funds into the applicable Custodial
Account within 24 hours of deposit in the Payment Clearing Account:
(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest on the Mortgage Loans
adjusted to the Mortgage Loan Remittance Rate;
(iii) all Liquidation Proceeds;
(iv) all Insurance Proceeds including amounts required to be deposited
pursuant to Sections 11.11 and 11.12, other than proceeds to be held in the
Escrow Account and applied to the restoration or repair of the Mortgaged
Property or released to Mortgagor in accordance with Seller's normal
servicing procedures, the loan documents or applicable law;
(v) all Condemnation Proceeds affecting any Mortgaged Property which
are not released to Mortgagor in accordance with Seller's normal servicing
procedures, the loan documents or applicable law;
(vi) all P&I Advances;
(vii) all proceeds of any Mortgage Loan repurchased in accordance with
Section 6.03 and all amounts required to be deposited by Seller in
connection with shortfalls in principal amount of Qualified Substitute
Mortgage Loans pursuant to Section 6.03;
(viii) any amounts required to be deposited by Seller in connection
with any REO Property pursuant to Section 11.14;
30
(ix) any amounts required to be deposited in the Custodial Account
pursuant to Section 11.20; and
(x) with respect to each Principal Prepayment in full or in part, an
amount (to be paid by Seller out of its own funds without reimbursement
therefor) which, when added to all amounts allocable to interest received
in connection with such Principal Prepayment, equals one month's interest
on the amount of principal so prepaid at the Mortgage Interest Rate,
provided, however, that in no event shall the aggregate of deposits made by
Seller pursuant to this clause (x) exceed the aggregate amount of Seller's
servicing compensation in the calendar month in which such deposits are
required.
The foregoing requirements for deposit in the Custodial Account shall be
exclusive, it being understood and agreed that, without limiting the generality
of the foregoing, payments in the nature of late payment charges, assumption
fees and other ancillary fees and charges, to the extent permitted by Section
11.01, need not be deposited by Seller in the Custodial Account. Each Custodial
Account shall be an Eligible Account. Seller shall give notice to Purchaser of
the location of the Custodial Account when established and prior to any change
thereof.
Any amounts held in the Custodial Account may be, but are not required to
be, invested by Seller. Any such investment by Seller must be in Eligible
Investments. Any interest or other income on Eligible Investments shall accrue
to the benefit of Seller and Seller shall be entitled to retain and withdraw
such funds from the Custodial Account pursuant to Section 11.06. Other than such
interest or other income received on Eligible Investments, no other amounts may
be commingled in the Custodial Account. Seller shall promptly deposit in the
Custodial Account from its own funds, without any right of reimbursement, the
full amount of any losses on its investment of funds in the Custodial Account.
(c) Without limiting the foregoing, the funds in the Custodial Accounts
shall at all times be segregated and held separate and apart from Seller's own
funds and general assets and from any other funds or assets collected or held by
Seller on behalf of third parties. Seller's account agreement for each Custodial
Account shall provide that such account is a special deposit, required to be
segregated and held by the depository institution maintaining such account in a
fiduciary capacity, separate and apart from the institution's own funds and
general assets and that the account shall not be held in any capacity that would
create a debtor-creditor relationship between the institution and Seller or
Purchaser. Each Custodial Account shall be evidenced by a Custodial Account
Certification in the form of Exhibit 5 and shall be entitled "ABN AMRO Mortgage
Group, Inc., as servicer, in trust for Purchaser". At all times, Purchaser shall
be the sole beneficial owner of all funds in the Custodial Accounts. Seller's
possession or control of any such funds shall be solely in Seller's capacity as
collecting agent for Purchaser.
Section 11.06. Withdrawals From the Custodial Account.
Seller shall, from time to time, withdraw funds from the Custodial Account
for the following purposes:
(a) to make payments to Purchaser in the amounts and in the manner provided
for in Section 11.16;
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(b) to reimburse itself for P&I Advances, Seller's right to reimburse
itself pursuant to this subclause (b) with respect to any Mortgage Loan being
limited to related Liquidation Proceeds, Condemnation Proceeds, Insurance
Proceeds, REO Disposition Proceeds and such other amounts as may be collected by
Seller from Mortgagor or otherwise relating to the Mortgage Loan, it being
understood that, in the case of any such reimbursement, Seller's right thereto
shall be prior to the rights of Purchaser, except that, where Seller is required
to repurchase a Mortgage Loan, pursuant to Section 6.03, Seller's right to such
reimbursement shall be subsequent to the payment to Purchaser of the Repurchase
Price pursuant to Section 6.03 and all other amounts required to be paid to
Purchaser with respect to such Mortgage Loan;
(c) to reimburse itself for any unpaid Servicing Fees and for unreimbursed
Servicing Advances, Seller's right to reimburse itself pursuant to this
subclause (c) with respect to any Mortgage Loan being limited to related
Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds, REO Disposition
Proceeds and such other amounts as may be collected by Seller from Mortgagor or
otherwise relating to the Mortgage Loan, it being understood that, in the case
of any such reimbursement, Seller's right thereto shall be prior to the rights
of Purchaser unless Seller is required to repurchase a Mortgage Loan pursuant to
Section 6.03, in which case Seller's right to such reimbursement shall be
subsequent to the payment to Purchaser of the Repurchase Price pursuant to
Section 6.03 and all other amounts required to be paid to Purchaser with respect
to such Mortgage Loan;
(d) to reimburse itself for unreimbursed Servicing Advances and for
▇▇▇▇▇▇▇▇▇▇▇▇ ▇&▇ Advances, in accordance with Section 11.18, to the extent that
such amounts are nonrecoverable by Seller pursuant to subclause (b) or (c)
above, provided that the Mortgage Loan for which such advances were made is not
required to be repurchased by Seller pursuant to Section 6.03;
(e) to reimburse itself for expenses incurred by and reimbursable to it
pursuant to this Agreement;
(f) to withdraw amounts to make P&I Advances in accordance with Section
11.18;
(g) to pay to itself any interest earned or any investment earnings on
funds deposited in the Custodial Account;
(h) to withdraw any amounts inadvertently deposited in the Custodial
Account; and
(i) to clear and terminate the Custodial Account upon the termination of
this Agreement.
Section 11.07. Establishment of Escrow Account; Deposits in Escrow Account.
(a) Seller shall establish one or more Escrow Accounts for the deposit of
Escrow Payments. Seller shall segregate and hold all funds collected and
received in connection with the Mortgage Loans which constitute Escrow Payments
separate and apart from any of its own funds and general assets and from any
other funds or amounts collected or held by Seller on behalf of third parties.
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(b) Seller shall transfer into the applicable Escrow Account within 24
hours of deposit in the Payment Clearing Account, and retain therein the
following payments and collections:
(i) Mortgagors' Escrow Payments collected in connection with the
Mortgage Loans, for the purpose of effecting timely payment of any such
items as required under the terms of this Agreement; and
(ii) all Insurance Proceeds which are to be applied to the restoration
or repair of any Mortgaged Property.
Seller shall make withdrawals therefrom only to effect such payments as are
required under this Agreement, and for such other purposes as shall be as set
forth or in accordance with Section 11.09.
(c) Each Escrow Account will be maintained at the expense of Seller at a
Qualified Depository. Such accounts may be interest-bearing accounts provided
that such accounts comply with all federal, state or local laws. Each Escrow
Account shall be evidenced by an Escrow Account Certification, in the form of
Exhibit 6 and shall be entitled "ABN AMRO Mortgage Group, Inc., as servicer, in
trust for Purchaser and various Mortgagors, Fixed and Adjustable Rate Mortgage
Loans." Seller shall ensure that all interest credited to any account that is
not due the respective Mortgagor is removed by Seller in accordance with
applicable law.
Section 11.08. Withdrawals From Escrow Account.
Withdrawals from the Escrow Account shall be made by Seller only (a) to
effect timely payments of ground rents, taxes, assessments, premiums for Primary
Mortgage Insurance Policies, fire, or hazard insurance premiums or other items
constituting Escrow Payments for the related Mortgage, (b) to reimburse Seller
for any Servicing Advance made by Seller pursuant to Section 11.09 hereof with
respect to a related Mortgage Loan, (c) to refund to any Mortgagor any funds
found to be in excess of the amounts required under the terms of the related
Mortgage Loan, (d) for transfer to the Custodial Account upon default of a
Mortgagor or in accordance with the terms of the related Mortgage Loan and if
permitted by applicable law, (e) for application to restore or repair of the
Mortgaged Property in accordance with the Mortgage Loan Documents, (f) to pay to
Mortgagor, to the extent required by law, any interest paid on the funds
deposited in the Escrow Account, (g) to pay to itself any interest earned on
funds deposited in the Escrow Account (and not required to be paid to
Mortgagor), (h) to withdraw suspense payments that are deposited into the Escrow
Account, (i) to withdraw any amounts inadvertently deposited in the Escrow
Account or (j) to clear and terminate the Escrow Account upon the termination of
this Agreement.
Section 11.09. Payment of Taxes, Insurance and Other Charges; Collections
Thereunder.
With respect to each Mortgage Loan, Seller shall maintain accurate records
reflecting the status of taxes and other charges for which an Escrow Account is
maintained, which are or may become a lien upon the Mortgaged Property and the
status of premiums for Primary Mortgage Insurance Policies and fire and hazard
insurance coverage and shall obtain, from time to time, for
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all Mortgage Loans with an Escrow Account, all bills for the payment of such
charges (including renewal premiums) and shall effect payment thereof prior to
the applicable penalty or termination date and at a time appropriate for
securing maximum discounts allowable, employing for such purpose deposits of
Mortgagor in the Escrow Account which shall have been estimated and accumulated
by Seller in amounts sufficient for such purposes, as allowed under the terms of
the Mortgage. To the extent that a Mortgage does not provide for Escrow
Payments, Seller shall determine that any such payments are made by Mortgagor.
Seller assumes full responsibility for the timely payment of all such bills and
shall effect timely payments of all such bills irrespective of each Mortgagor's
faithful performance in the payment of same or the making of the Escrow Payments
and shall make Servicing Advances to effect such payments, subject to its
ability to recover such Servicing Advances pursuant to Section 11.08(b).
Section 11.10. Transfer of Accounts.
Seller may transfer the Payment Clearing Account, Custodial Account or the
Escrow Account and all funds and investments therein to a different Qualified
Depository from time to time. Such transfer shall be made only upon obtaining
the prior written consent of Purchaser. In any case, the Payment Clearing
Account, Custodial Account and Escrow Account shall be Eligible Accounts.
If any one of the Investment Ratings of a Qualified Depository holding
funds or Eligible Investments in the Payment Clearing Account, Custodial Account
or Escrow Account as an Eligible Account is downgraded by the issuing rating
agency, Seller shall, within three (3) Business Days of receipt of notice of the
downgrading, transfer all such accounts, funds and Eligible Investments to a
different Qualified Depository in accordance with this Agreement.
Section 11.11. Maintenance of Hazard Insurance.
Seller shall cause to be maintained for each Mortgage Loan fire and hazard
insurance with extended coverage customary in the area where the Mortgaged
Property is located by an insurer acceptable to the Agency, in an amount which
is at least equal to the lesser of (a) the full insurable value of the Mortgaged
Property or (b) the greater of (i) the outstanding principal balance owing on
the Mortgage Loan and (ii) an amount such that the proceeds of such insurance
shall be sufficient to avoid the application to Mortgagor or loss payee of any
coinsurance clause under the policy. If the Mortgaged Property is in an area
identified by the Federal Emergency Management Agency as a special flood hazard
area (and such flood insurance has been made available), Seller will cause to be
maintained a flood insurance policy meeting the requirements of the National
Flood Insurance Program, in an amount representing coverage not less than the
least of (A) the minimum amount required under the terms of the coverage to
compensate for any damage or loss to the Mortgaged Property on a
replacement-cost basis (or the outstanding principal balance of the Mortgage
Loan if replacement-cost coverage is not available) or (B) the maximum amount of
insurance available under the National Flood Insurance Program. Seller shall
also maintain on REO Property fire and hazard insurance with extended coverage
in an amount which is at least equal to the maximum insurable value of the
improvements which are a part of such property, liability insurance and, to the
extent required and available under the National Flood Insurance Program, flood
insurance in an amount required above. Any amounts collected by Seller under any
such policies (other than amounts to be deposited in the Escrow
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Account and applied to the restoration or repair of the property subject to the
related Mortgage or property acquired in liquidation of the Mortgage Loan, or to
be released to Mortgagor in accordance with Customary Servicing Procedures and
the Mortgage Loan Documents) shall be deposited in the Custodial Account,
subject to withdrawal pursuant to Section 11.06. It is understood and agreed
that no earthquake or other additional insurance need be required by Seller of
any Mortgagor or maintained on REO Property other than pursuant to such
applicable laws and regulations as shall at any time be in force and as shall
require such additional insurance. All policies required hereunder shall be
endorsed with standard mortgagee clauses with loss payable to Seller, and shall
provide for at least thirty (30) days prior written notice of any cancellation,
reduction in amount or material change in coverage to Seller. Seller shall not
interfere with Mortgagor's freedom of choice in selecting either his insurance
carrier or agent; provided, however, that Seller shall not accept any such
insurance policies from insurance companies unless such companies comply with
the standards set by the Agency.
Section 11.12. Maintenance of Primary Mortgage Insurance Policy; Claims.
With respect to each Mortgage Loan with a LTV in excess of 80%, Seller
shall, without any cost to Purchaser, maintain or cause Mortgagor to maintain in
full force and effect a Primary Mortgage Insurance Policy insuring that portion
of the Mortgage Loan in excess of a percentage in conformance with the Agency
requirements. Seller shall pay or shall cause Mortgagor to pay the premium
thereon on a timely basis, at least until the LTV of such Mortgage Loan is
reduced to 80%, or such amount as required by applicable law, or such other
amount as the Agency permits for cancellation of mortgage insurance. In the
event that such Primary Mortgage Insurance Policy shall be terminated, Seller
shall obtain from another insurer a comparable replacement policy, with a total
coverage equal to the remaining coverage of such terminated Primary Mortgage
Insurance Policy. If the insurer shall cease to be a qualified insurer, Seller
shall determine whether recoveries under the Primary Mortgage Insurance Policy
are jeopardized for reasons related to the financial condition of such insurer,
it being understood that Seller shall in no event have any responsibility or
liability for any failure to recover under the Primary Mortgage Insurance Policy
for such reason. If Seller determines that recoveries are so jeopardized, it
shall notify Purchaser and Mortgagor, if required, and obtain from another
qualified insurer a replacement insurance policy. Seller shall not take any
action which would result in noncoverage under any applicable Primary Mortgage
Insurance Policy of any loss which, but for the actions of Seller would have
been covered thereunder. In connection with any assumption or substitution
agreement entered into or to be entered into pursuant to Section 11.19, Seller
shall promptly notify the insurer under the related Primary Mortgage Insurance
Policy, if any, of such assumption or substitution of liability in accordance
with the terms of such Primary Mortgage Insurance Policy and shall take all
actions which may be required by such insurer as a condition to the continuation
of coverage under such Primary Mortgage Insurance Policy. If such Primary
Mortgage Insurance Policy is terminated as a result of such assumption or
substitution of liability, Seller shall obtain a replacement Primary Mortgage
Insurance Policy as provided above.
In connection with its activities as Seller, Seller agrees to prepare and
present, on behalf of itself and Purchaser, claims to the insurer under any
Primary Mortgage Insurance Policy in a timely fashion in accordance with the
terms of such Primary Mortgage Insurance Policy and, in this regard, to take
such action as shall be necessary to permit recovery under any Primary
35
Mortgage Insurance Policy respecting a defaulted Mortgage Loan. Pursuant to
Section 11.07, any amounts collected by Seller under any Primary Mortgage
Insurance Policy shall be deposited in the Escrow Account, subject to withdrawal
pursuant to Section 11.08.
Section 11.13. Fidelity Bond; Errors and Omissions Insurance.
Seller shall maintain, at its own expense, a blanket Fidelity Bond and an
errors and omissions insurance policy, with broad coverage on all officers,
employees or other persons acting in any capacity requiring such persons to
handle funds, money, documents or papers relating to the Mortgage Loans. These
policies must insure Seller against losses resulting from dishonest or
fraudulent acts committed by Seller's personnel, any employees of outside firms
that provide data processing services for Seller, and temporary contract
employees or student interns. The Fidelity Bond shall also protect and insure
Seller against losses in connection with the release or satisfaction of a
Mortgage Loan without having obtained payment in full of the indebtedness
secured thereby. No provision of this Section 11.13 requiring such Fidelity Bond
and errors and omissions insurance shall diminish or relieve Seller from its
duties and obligations as set forth in this Agreement. The minimum coverage
under any such Fidelity Bond and insurance policy shall be at least equal to the
corresponding amounts required by the Agency in the Servicing Guidelines, as
amended or restated from time to time, or in an amount as may be permitted to
Seller by express waiver of the Agency.
Section 11.14. Title, Management and Disposition of REO Property.
Within four (4) Business Days of receiving a notice from Seller that a
foreclosure sale of a Mortgaged Property has occurred or that a deed-in-lieu of
foreclosure has been obtained, Purchaser shall give Seller written notice
whether or not it elects to have Seller manage and dispose of the REO Property;
provided, however, failure by Purchaser to respond to such notice within four
(4) Business Days shall be deemed an election by Purchaser of Seller to manage
and dispose of the REO Property.
(a) If Purchaser elects to have someone other than Seller manage and
dispose of a REO Property, the deed or certificate of sale shall be taken in the
name of Purchaser or Purchaser's nominee. Whenever a REO Property is transferred
to Purchaser, any nominee of Purchaser or any third party upon disposition of
the REO Property, Purchaser shall have no right to transfer it back to Seller,
and Seller shall not thereafter have any liability to Purchaser, or to any
Person with any interest in the REO Property, for or on account of the REO
Property, including without limitation any liability for the management, care
and disposition of the REO Property. Purchaser, however, shall promptly
reimburse Seller for any and all costs and expenses incurred by Seller in
management, care and/or disposition of a REO Property up to the transfer of that
REO Property to Purchaser, Purchaser's nominee or a third party upon disposition
of the REO Property.
(b) If Purchaser elects to have Seller manage and dispose of a REO
Property, Purchaser shall pay Seller a fee in an amount equal to the greater of
$1,500.00 or one and one half percent (1.50%) of the sales price of the REO
Property (the "Management Fee"). The Management Fee shall be paid from the REO
Disposition Proceeds of the REO Property unless
36
Seller's management and disposition services are terminated prior to disposition
of the REO Property, in which case Purchaser shall pay Seller the Management
Fee.
If Purchaser elects to have Seller manage and dispose of the REO Property,
the deed or certificate of sale shall be taken in the name of Seller or its
nominee. Seller shall hold title for the benefit of Purchaser of record on the
date of acquisition of title. In the event Seller is not authorized or permitted
to hold title to real property in the state where the REO Property is located,
or would be adversely affected under the "doing business" or tax laws of such
state by so holding title, the deed or certificate of sale shall be taken in the
name of such Person or Persons as shall be consistent with an opinion of counsel
obtained by Seller, at the expense of Purchaser, from an attorney duly licensed
to practice law in the state where the REO Property is located. The Person or
Persons holding such title other than Purchaser shall acknowledge in writing
that such title is being held as nominee for Purchaser.
Seller shall cause to be deposited on a daily basis in the Custodial
Account all revenues received by it with respect to the conservation and
disposition of a REO Property and shall withdraw therefrom funds necessary for
the proper operation, management and maintenance of the REO Property by it
pursuant to this Section, including the cost of maintaining any hazard insurance
pursuant to Section 11.11 hereof and the fees of any managing agent acting on
behalf of Seller. Any single disbursement in excess of $10,000 shall be made
only with the approval of Purchaser, provided, however, Seller may pay property
taxes without obtaining Purchaser's approval. Seller shall make distributions as
required on each Remittance Date to Purchaser of the net cash flow from the REO
Property (which shall equal the revenues from such REO Property net of the
expenses described above and of any reserves reasonably required from time to
time to be maintained to satisfy anticipated liabilities for such expenses).
The disposition of REO Property shall be carried out by Seller in
accordance with the provisions of this Agreement and with the prior consent of
Purchaser; provided, however, that such consent shall not be unreasonably
withheld or delayed. Prior to any disposition of REO Property, Seller shall
provide notice to Purchaser of such proposed disposition, requesting its consent
thereto. If Purchaser has not expressly denied its consent by written notice to
Seller within two (2) Business Days of the request therefor, Purchaser shall be
deemed to have consented to such disposition of REO Property. Upon the request
of Purchaser, and at Purchaser's expense, Seller shall cause an appraisal of the
REO Property to be performed for Purchaser.
The net proceeds of the sale by Seller of a REO Property shall be promptly
deposited in the Custodial Account and, as soon as practical thereafter, the
expenses of such sale shall be paid, Seller shall reimburse itself for any
related Management Fee, unreimbursed Servicing Advances, unpaid Servicing Fees,
unreimbursed advances made pursuant to Section 11.18 and any appraisal performed
pursuant to this paragraph and the net cash proceeds of such sale remaining in
the Custodial Account shall be distributed to Purchaser. If Seller receives an
offer to purchase REO Property that will net Purchaser 90% or more of the value
of the REO Property, Seller may dispose of the Property without obtaining
Purchaser's prior consent.
Seller shall either itself or through an agent selected by Seller, manage,
conserve, protect and operate the REO Property in the same manner that it
manages, conserves, protects and operates other foreclosed property for its own
account, and in the same manner that similar
37
property in the same locality as the REO Property is managed. Seller shall
attempt to sell the same (and may temporarily rent the same) on such terms and
conditions as Seller deems to be in the best interest of Purchaser.
Seller shall furnish Purchaser, on a monthly basis, (i) a statement
describing Seller's efforts in connection with the sale of such REO Property and
any rental of the REO Property incidental to the sale thereof for the previous
month, and (ii) an itemized cash-basis statement of the previous month's
operating income and expenses for such REO Property.
Section 11.15. Servicing Compensation.
As compensation for its services hereunder, Seller shall be entitled to
retain the Servicing Fee from interest payments on the Mortgage Loans.
Additional servicing compensation in the form of assumption fees, late payment
charges and other ancillary income shall be retained by Seller to the extent not
required to be deposited in the Custodial Account. Seller shall be required to
pay all expenses incurred by it in connection with its servicing activities
hereunder and shall not be entitled to reimbursement therefor except as
specifically provided for herein.
Section 11.16. Distributions.
On each Remittance Date Seller shall remit by wire transfer of immediately
available funds to the account designated in writing by Purchaser of record on
the preceding Record Date the sum of (a) all amounts deposited in the Custodial
Account as of the close of business on the last day of the calendar month
preceding the Remittance Date, plus (b) the amount equal to all Monthly Payments
due on such Remittance Date, minus (c) all amounts that may be withdrawn from
the Custodial Account pursuant to Section 11.06, minus (d) any amounts
attributable to Monthly Payments collected but due on a Due Date or Due Dates
subsequent to the first day of the month of the Remittance Date.
With respect to any remittance received by Purchaser after the Business Day
on which such payment was due, Seller shall pay to Purchaser interest on any
such late payment at the daily federal funds rate. Such interest shall be paid
by Seller to Purchaser on the date such late payment is made and shall cover the
period commencing with the Business Day on which such payment was due and up to
but excluding the Business Day on which such payment is made. The payment by
Seller of any such interest shall not be deemed an extension of time for payment
or a waiver of any Event of Default by Seller.
Section 11.17. Statements to Purchaser.
On or before each Determination Date, Seller shall forward to Purchaser a
statement setting forth (a) the amount of the distribution to be made on such
Remittance Date which is allocable to principal and allocable to interest; (b)
the amount of servicing compensation received by Seller during the prior
calendar month; and (c) the aggregate Stated Principal Balance of the Mortgage
Loans as of the last day of the preceding month. Such statement shall also
include information regarding delinquencies on Mortgage Loans, indicating the
number and aggregate principal amount of Mortgage Loans which are either one
(1), two (2) or three (3) or more months delinquent and the book value of any
REO Property. Seller shall submit to Purchaser monthly a liquidation report with
respect to each Mortgaged Property sold in a
38
foreclosure sale as of the related Record Date and not previously reported. Such
liquidation report shall be incorporated into the remittance report delivered to
Purchaser. Upon written request of Purchaser, Seller shall deliver remittance
information on a loan-by-loan basis that is of the type typically maintained by
Seller's computerized servicing system.
Section 11.18. Advances by Seller.
On the Business Day immediately preceding each Remittance Date, Seller
shall either (a) deposit in the Custodial Account from its own funds an amount
equal to the aggregate amount of all Monthly Payments (with interest adjusted to
the Mortgage Loan Remittance Rate) which were due on the Mortgage Loans on the
Due Date, and which were delinquent on the close of business on the immediately
preceding Determination Date (each such advance, a "P&I Advance"), (b) so long
as Seller's long and short term credit ratings are accorded a rating of "BBB" or
higher by S&P and "Baa" or higher by ▇▇▇▇▇'▇, cause to be made an appropriate
entry in the records of the Custodial Account that amounts held for future
distribution have been, as permitted by this Section 11.18, used by Seller in
discharge of any such P&I Advance or (c) so long as Seller's long and short term
credit ratings are accorded a rating of "BBB" or higher by S&P and "Baa" or
higher by ▇▇▇▇▇'▇, make P&I Advances in the form of any combination of (a) or
(b) aggregating the total amount of advances to be made. Any amounts held for
future distribution and so used shall be replaced by Seller by deposit in the
Custodial Account on or before any future Remittance Date if funds in the
Custodial Account on such Remittance Date shall be less than payments to
Purchaser required to be made on such Remittance Date. Seller's obligation to
make P&I Advances as to any Mortgage Loan will continue through the last Monthly
Payment due prior to the payment in full of a Mortgage Loan, or through the last
Remittance Date prior to the Remittance Date for the distribution of all other
payments or recoveries (including proceeds under any title, hazard or other
insurance policy, or condemnation awards) with respect to a Mortgage Loan;
provided, however, that such obligation shall cease if (i) the Mortgage Loan has
become a Liquidating Loan or (ii) if Seller, in its good faith judgment,
determines that P&I Advances would not be recoverable pursuant to Section
11.06(d). The determination by Seller that a P&I Advance, if made, would be
nonrecoverable, shall be evidenced by an officer's certificate of Seller,
delivered to Purchaser, which details the reasons for such determination.
Section 11.19. Assumption Agreements.
Seller will use its best efforts to enforce any "due-on-sale" provision
contained in any Mortgage or Mortgage Note, provided that Seller shall permit
such assumption if so required in accordance with the terms of the Mortgage or
the Mortgage Note. When the Mortgaged Property has been conveyed prior to
payment in full of the Mortgage Loan, Seller will, to the extent it has
knowledge of such conveyance, exercise its rights to accelerate the maturity of
such Mortgage Loan under the "due-on-sale" clause applicable thereto; provided,
however, Seller will not exercise such rights if prohibited by law from doing so
or if the exercise of such rights would impair or threaten to impair any
recovery under the related Primary Mortgage Insurance Policy, if any. In
connection with any such assumption, the outstanding principal amount, the
Monthly Payment and the Mortgage Interest Rate of the related Mortgage Note
shall not be changed, and the term of the Mortgage Loan will not be increased or
decreased. If an assumption is allowed pursuant to this Section 11.19, Seller
with the prior consent of the issuer of the Primary
39
Mortgage Insurance Policy, if any, is authorized to enter into a substitution of
liability agreement with the purchaser of the Mortgaged Property pursuant to
which the original Mortgagor is released from liability and the purchaser of the
Mortgaged Property is substituted as Mortgagor and becomes liable under the
Mortgage Note.
Notwithstanding the foregoing paragraph or any other provision of this
Agreement, Seller shall not be deemed to be in default, breach or any other
violation of its obligations hereunder by reason of any assumption of a Mortgage
Loan by operation of law or any assumption which the Seller may be restricted by
law from preventing, for any reason whatsoever.
Section 11.20. Satisfaction of Mortgages and Release of Mortgage Loan
Documents.
Upon the payment in full of any Mortgage Loan, or the receipt by Seller of
a notification that payment in full will be escrowed in a manner customary for
such purposes, Seller will obtain the portion of the Mortgage Loan Documents
that is in the possession of Purchaser or its designee, prepare and process any
required satisfaction or release of the Mortgage and notify Purchaser or its
designee in accordance with the provisions of this Agreement. Purchaser agrees
to deliver or cause to be delivered to Seller the Mortgage Loan Documents for
any Mortgage Loan not later than three (3) Business Days following its receipt
of a notice from Seller that such a payment in full has been received or that a
notification has been received that such a payment in full shall be made. Such
Mortgage File shall be held by Seller for the purpose of canceling such Mortgage
Note and delivering the canceled Mortgage Note to Mortgagor in a timely manner
as and to the extent provided under applicable state law.
In the event Seller grants a satisfaction or release of a Mortgage without
having obtained payment in full of the indebtedness secured by the Mortgage and
should Seller otherwise prejudice any right Purchaser may have under the
mortgage instruments, Seller, upon written demand of Purchaser, shall remit to
Purchaser the Stated Principal Balance of the related Mortgage Loan by deposit
thereof in the Custodial Account. The Fidelity Bond shall insure Seller against
any loss it may sustain with respect to any Mortgage Loan not satisfied in
accordance with the procedures set forth herein.
Section 11.21. Annual Statement of Compliance.
On or before March 1st of each year, Seller shall deliver to Purchaser an
officer's certificate (each, an "Annual Statement of Compliance") stating that
(i) a review of the activities of Seller during the preceding calendar year and
of performance under this Agreement has been made under such officers'
supervision and (ii) to the best of such officers' knowledge, based on such
review, Seller has fulfilled all of its obligations under this Agreement
throughout such year, or, if there has been a default in the fulfillment of any
such obligation, specifying each such default known to such officer and the
nature and status thereof.
Section 11.22. Annual Independent Public Accountants' Servicing Report.
On or before March 1st of each year, Seller at its expense shall cause a
firm of independent public accountants which is a member of the American
Institute of Certified Public Accountants to furnish a statement (a "USAP
Report") to Purchaser (and upon thirty day's prior
40
written notice from Purchaser to a master servicer or depositor so designated by
Purchaser in such notice) to the effect that such firm has, with respect to
Seller's overall servicing operations, examined such operations in accordance
with the requirements of the Uniform Single Attestation Program for Mortgage
Bankers, stating such firm's conclusions relating thereto.
Notwithstanding the foregoing, the Seller's obligation to deliver a USAP
Report under this Subsection, as to the Seller or any Subservicer, as to any
calendar year, beginning with the report required in March 2007, shall be
satisfied if an assessment of compliance and attestation report is delivered in
compliance with Subsection 33.05 for such calendar year with respect to that
entity.
Section 11.23. Seller Shall Provide Access and Information as Reasonably
Required.
Seller shall provide to Purchaser, and for any Purchaser insured by FDIC,
the supervisory agents and examiners of FDIC and the applicable financial
institution regulator, access to any documentation regarding the Mortgage Loans
which may be required by applicable regulations; provided, however, that any
such access shall be (i) upon reasonable advance notice to Seller, (ii) at
Purchaser's expense, (iii) during Seller's normal business hours, and (iv) in a
manner which conforms to Seller's security and confidentiality policies and does
not unreasonably interfere with Seller's business.
In addition, Seller shall furnish upon request by Purchaser, during the
term of this Agreement, such periodic, special or other reports or information,
which are prepared in accordance with Seller's customary practices, whether or
not provided for herein, as shall be necessary, reasonable and appropriate with
respect to the purposes of this Agreement and applicable regulations. All such
reports or information shall be provided by and in accordance with all
reasonable instructions and directions Purchaser may require. Seller agrees to
execute and deliver all such instruments and take all such action as Purchaser,
from time to time, may reasonably request in order to effectuate the purposes
and to carry out the terms of this Agreement.
Section 11.24. Notification of Adjustments.
On each Adjustment Date, Seller shall make interest rate adjustments for
each Adjustable Rate Mortgage Loan in compliance with the requirements of the
related Mortgage and Mortgage Note. Seller shall execute and deliver the notices
required by each Mortgage and Mortgage Note regarding interest rate adjustments.
Seller also shall provide timely notification to Purchaser of all applicable
data and information regarding such interest rate.
Section 11.25. Compliance With REMIC Provisions.
If Seller has received written notice from Purchaser (or the Purchaser's
designee) that a REMIC election or elections has been made with respect to the
arrangement under which any Mortgage Loans and REO Property are held, Seller
shall not take any action, or omit to take any action, that, under the REMIC
Provisions, if taken or not taken, as the case may be, would (i) cause the
termination of the status of any REMIC as a REMIC, (ii) result in the imposition
of a tax upon the REMIC (including but not limited to the tax on "prohibited
transactions" as defined
41
in Section 860F(a)(2) of the Code and the tax on "contributions" to a REMIC set
forth in Section 860G(d) of the Code), or (iii) cause any REO Property to fail
to qualify as "foreclosure property" within the meaning of Section 860G(a)(8) of
the Code or result in the receipt by any REMIC of any "income from non-permitted
assets" within the meaning of Section 860F(a)(2)(B) of the Code or any "net
income from foreclosure property" which is subject to taxation under Section
860G(a)(1) of the Code, unless either (A) Seller has received an opinion of
counsel (at the expense of the party seeking to take such action) to the effect
that the contemplated action will not endanger such REMIC status or result in
the imposition of any such tax, or (B) Purchaser or its assignee has directed or
requested the contemplated action after being advised by Seller that such action
might compromise any REMIC, in which case Seller shall not be responsible for
obtaining such opinion of counsel. If a REMIC election is made with respect to
the arrangement under which REO Property is held, Seller shall dispose of such
REO Property within three years or such other period as may be permitted under
Section 860G(a)(8) of the Code. Notwithstanding any other provision of this
Agreement, if Seller has made a good faith effort to dispose of the REO Property
by sale, it shall have no liability under this Agreement for not selling any REO
Property within such three year period. If, after Seller has made a good faith
effort to dispose of the REO Property by sale and the REO Property is unsalable
for any reason, or if Purchaser withholds its consent to the sale thereof,
Seller shall transfer the REO Property to Purchaser or an affiliate of Purchaser
by delivery of a deed to that effect to Purchaser or an affiliate of Purchaser
prior to the expiration of the applicable three year period. Seller shall in no
event be obligated to purchase the REO Property.
SECTION 12. Seller.
Section 12.01. Indemnification; Third Party Claims.
Seller agrees to indemnify and hold harmless Purchaser against any and all
claims, losses, penalties, fines, forfeitures, legal fees and related costs,
judgments, and any other costs, fees and expenses that Purchaser may sustain due
to the failure of Seller to service the Mortgage Loans in material compliance
with the terms of this Agreement.
If Purchaser seeks indemnification under this Section 12.01, it must
promptly give Seller notice of any legal action or potential claim. However,
delay or failure by Purchaser to provide such notice shall not release Seller
from any indemnity obligations, except and only to the extent that Seller shows
that such delay or failure materially prejudiced the defense of such action or
increased the amount of such claim. Seller shall be responsible to conduct such
defense through counsel reasonably satisfactory to Purchaser provided, however,
that Seller is permitted to control fully the defense of any such claim and to
settle any such claim subject to Purchaser's approval, which approval shall not
be unreasonably withheld; provided further, that Purchaser shall have the right
to retain counsel to represent it at its expense in connection with any such
claim. If Seller fails to assume the defense of an action within twenty (20)
days after receiving notice, then Seller shall be bound by any determination
made in the action or by any compromise or settlement Purchaser may effect.
Without the consent of the other party, neither Purchaser nor Seller shall agree
to any settlement if the matter involves any possible criminal action or
proceeding, or contains a stipulation to, or admission or acknowledgment of, any
wrongdoing (in tort or otherwise) on the part of the other party, and the
settlement of any such matter without the prior written consent of the other
party shall be void and of no effect with respect to that other
42
party. Purchaser agrees to use reasonable efforts to mitigate any claims
tendered to Seller. Purchaser shall assign to Seller all of its claims for
recovery against third parties for any indemnification provided by Seller,
whether such claims arise pursuant to insurance coverage, contribution,
subrogation or otherwise.
Section 12.02. Merger or Consolidation of Seller.
Seller will keep in full effect its existence, rights and franchises, and
will obtain and preserve its qualification to do business in each jurisdiction
in which such qualification is or shall be necessary to protect the validity and
enforceability of this Agreement or any of the Mortgage Loans and to perform its
duties under this Agreement.
Any Person into which Seller may be merged or consolidated, or any
corporation resulting from any merger, conversion or consolidation to which
Seller shall be a party, or any Person succeeding to substantially all of the
business of Seller (whether or not related to loan servicing), shall be the
successor of Seller hereunder, without the execution or filing of any paper or
any further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.
Section 12.03. Limitation on Liability of Seller and Others.
The duties and obligations of Seller shall be determined solely by the
express provisions of this Agreement; Seller shall not be liable except for the
performance of such duties and obligations as are specifically set forth in this
Agreement; and no implied warranties, covenants or obligations shall be read
into this Agreement against Seller. Neither Seller nor any of the directors,
officers, employees or agents of Seller shall be under any liability to
Purchaser for any action taken or for refraining from the taking of any action
in accordance with Customary Servicing Procedures and otherwise in good faith
pursuant to this Agreement or for errors in judgment; provided, however, that
this provision shall not protect Seller against any liability resulting from any
material breach of any representation or warranty made herein; and, provided
further, that this provision shall not protect Seller against any liability that
would otherwise be imposed by reason of the willful misfeasance, bad faith or
gross negligence in the performance of duties or by reason of reckless disregard
of its obligations or duties hereunder. Seller and any director, officer,
employee or agent of Seller may rely on any document of any kind which it in
good faith reasonably believes to be genuine and to have been adopted or signed
by the proper authorities respecting any matters arising hereunder. Subject to
the terms of Section 12.01, Seller shall have no obligation to appear with
respect to, prosecute or defend any legal action which is not incidental to
Seller's duty to service the Mortgage Loans in accordance with this Agreement.
Section 12.04. Seller Not to Resign.
Except as provided in Section 12.02, Seller shall not assign this Agreement
nor resign from the obligations and duties hereby imposed on it except by mutual
consent of Seller and Purchaser or upon the determination that Seller's duties
hereunder are no longer permissible under applicable law and such incapacity
cannot be cured by Seller. Any such determination permitting the unilateral
resignation of Seller shall be evidenced by an opinion of counsel to such
43
effect delivered to Purchaser, which opinion of counsel shall be in form and
substance acceptable to Purchaser. Except as provided in Section 12.02, no such
resignation or assignment shall become effective until a successor has assumed
Seller's responsibilities and obligations hereunder in accordance with Section
14.03.
SECTION 13. Default.
Section 13.01. Events of Default.
In case one or more of the following Events of Default by Seller shall
occur and be continuing:
(a) any failure by Seller to remit to Purchaser any payment required to be
made under the terms of this Agreement which continues unremedied for a period
of one (1) Business Day after the date upon which written notice of such
failure, requiring the same to be remedied, shall have been given to Seller by
Purchaser; or
(b) failure by Seller to duly observe or perform, in any material respect,
any other covenants, obligations or agreements of Seller as set forth in this
Agreement which failure continues unremedied for a period of thirty (30) days
(unless a different period is otherwise specified in this Agreement) after the
date on which written notice of such failure, requiring the same to be remedied,
shall have been given to Seller by Purchaser; or
(c) a decree or order of a court or agency or supervisory authority having
jurisdiction for the appointment of a conservator or receiver or liquidator in
any insolvency, bankruptcy, readjustment of debt, marshalling of assets and
liabilities or similar proceedings, or for the winding-up or liquidation of its
affairs, shall have been entered against Seller and such decree or order shall
have remained in force, undischarged or unstayed for a period of sixty (60)
days; or
(d) Seller shall consent to the appointment of a conservator or receiver or
liquidator in any insolvency, bankruptcy, readjustment of debt, marshalling of
assets and liabilities or similar proceedings of or relating to Seller or
relating to all or substantially all of Seller's property; or
(e) Seller shall admit in writing its inability to pay its debts as they
become due, file a petition to take advantage of any applicable insolvency or
reorganization statute, make an assignment for the benefit of its creditors, or
voluntarily suspend payment of its obligations; or
(f) failure to be an Agency approved Seller;
then, and in each and every such case, so long as an Event of Default shall not
have been remedied, Purchaser, by notice in writing to Seller, may, in addition
to whatever rights Purchaser may have at law or equity, including damages,
injunctive relief and specific performance, commence termination of all the
rights and obligations of Seller under this Agreement and in and to the Mortgage
Loans and the proceeds thereof. Upon receipt by Seller of such written notice
from Purchaser stating that they intend to terminate Seller as a result of such
Event of Default, all authority and power of Seller under this Agreement,
whether with respect to the Mortgage Loans or otherwise, shall pass to and be
vested in the successor appointed pursuant to Section 14.03.
44
Upon written request from Purchaser, Seller shall prepare, execute and deliver
to a successor any and all documents and other instruments, place in such
successor's possession all Mortgage Files and do or cause to be done all other
acts or things necessary or appropriate to effect the purposes of such notice of
termination, including, but not limited to, the transfer and endorsement or
assignment of the Mortgage Loans and related documents to the successor at
Seller's sole expense. Seller agrees to cooperate with Purchaser and such
successor in effecting the termination of Seller's responsibilities and rights
hereunder, including, without limitation, the transfer to such successor for
administration by it of all amounts which shall at the time be credited by
Seller to the Custodial Account or Escrow Account or thereafter received with
respect to the Mortgage Loans.
Section 13.02. Waiver of Defaults.
Purchaser may waive any default by Seller in the performance of its
obligations hereunder and its consequences. Upon any waiver of a past default,
such default shall cease to exist, and any Event of Default arising therefrom
shall be deemed to have been remedied for every purpose of this Agreement. No
such waiver shall extend to any subsequent or other default or impair any right
consequent thereto except to the extent expressly so waived.
SECTION 14. Termination.
Section 14.01. Termination.
Unless terminated with respect to all or a portion of the Mortgage Loans on
an earlier date pursuant to Section 13, the respective obligations and
responsibilities of Seller, as servicer, shall terminate upon the distribution
to Purchaser of the final payment or disposition with respect to the last
Mortgage Loan (or advances of same by Seller) and the disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure with respect
to the last Mortgage Loan and the remittance of all funds due hereunder. Upon
written request from Purchaser in connection with any such termination, Seller
shall prepare, execute and deliver, any and all documents and other instruments,
place in Purchaser's possession all Mortgage Files, and do or accomplish all
other acts or things necessary or appropriate to effect the purposes of such
termination, whether to complete the transfer and endorsement or assignment of
the Mortgage Loans and related documents, or otherwise, at Purchaser's sole
expense. Seller agrees to cooperate with Purchaser and such successor in
effecting the termination of Seller's responsibilities and rights hereunder as
Seller, including, without limitation, the transfer to such successor for
administration by it of all cash amounts which shall at the time be credited by
Seller to the Custodial Account or Escrow Account or thereafter received with
respect to the Mortgage Loans.
Section 14.02. Termination of Seller Without Cause.
Notwithstanding anything herein to the contrary, Purchaser may terminate
the obligations and responsibilities of Seller, without cause, upon payment to
Seller of a termination fee equal to two percent (2%) of the aggregate
outstanding principal balance of the Mortgage Loans as of the date of such
termination. In addition, Purchaser shall reimburse Seller for any and all
out-of-pocket costs incurred by Seller in connection with such termination. The
termination fee
45
provided for in this Section 14.02 shall be paid by Purchaser within ten (10)
Business Days of any such termination without cause by Purchaser, and Purchaser
shall reimburse Seller for its out-of-pocket costs resulting from such
termination within ten (10) Business Days following Purchaser's receipt of an
invoice for such costs.
Section 14.03. Successors to Seller.
Prior to the termination of Seller's responsibilities and duties under this
Agreement pursuant to Sections 12.04, 13.01 or 14.01, Purchaser shall, (a)
succeed to and assume all of Seller's responsibilities, rights, duties and
obligations under this Agreement or (b) within one hundred eighty (180) days
appoint a successor which shall succeed to all rights and assume all of the
responsibilities, duties and liabilities of Seller under this Agreement upon
such termination. In connection with such appointment and assumption, Purchaser
may make such arrangements for the compensation of such successor out of
payments on Mortgage Loans as it and such successor shall agree. In the event
that Seller's duties, responsibilities and liabilities under this Agreement
shall be terminated pursuant to the aforementioned Sections, Seller shall
discharge such duties and responsibilities during the period from the date it
acquires knowledge of such termination until the effective date thereof with the
same degree of diligence which it is obligated to exercise under this Agreement.
The resignation or removal of Seller pursuant to the aforementioned Sections
shall not become effective until a successor shall be appointed pursuant to this
Section and shall in no event relieve Seller of the representations and
warranties made pursuant to Sections 6.01 and 6.02 and the remedies available to
Purchaser under Sections 6.03 and 6.04, it being understood and agreed that the
provisions of such Sections 6.01 and 6.02 shall be applicable to Seller
notwithstanding any such resignation or termination of Seller, or the
termination of this Agreement.
Any successor to Seller appointed as provided herein shall execute,
acknowledge and deliver to Seller and to Purchaser an instrument accepting such
appointment, whereupon such successor shall become fully vested with all the
rights, powers, duties, responsibilities, obligations and liabilities of Seller,
with like effect as if originally named as a party to this Agreement. Any
termination or resignation of Seller or this Agreement pursuant to Sections
12.04, 13.01 or 14.01 shall not affect any claims that Purchaser may have
against Seller under this Agreement which arose prior to any such termination or
resignation.
Seller shall promptly deliver to the successor the funds in the Custodial
Account and Escrow Account and all Mortgage Files and related documents and
statements held by it hereunder, and Seller shall account for all funds and
shall execute and deliver such instruments and do such other things as may
reasonably be required to more fully and definitively vest in the successor all
such rights, powers, duties, responsibilities, obligations and liabilities of
Seller.
Upon a successor's acceptance of appointment as such, Seller shall notify
by mail Purchaser of such appointment.
SECTION 15. Notices. All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed, by
registered or certified mail, postage prepaid, return receipt requested, or, if
by other means, when received by the other party at the address as follows:
46
(a) if to Seller:
ABN AMRO Mortgage Group, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Fax: 904/▇▇▇-▇▇▇▇
Phone: 904/▇▇▇-▇▇▇▇
With a copy to:
LaSalle Bank Corporation
Legal Department
▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇.
▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Fax: 248/▇▇▇-▇▇▇▇
Phone: 248/▇▇▇-▇▇▇▇
(b) if to Purchaser:
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Lending, Inc.
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Mortgage Finance
Fax: 212/▇▇▇-▇▇▇▇
Phone: 212/▇▇▇-▇▇▇▇
or such other address as may hereafter be furnished to the other party by like
notice. Any such demand, notice or communication hereunder shall be deemed to
have been received on the date delivered to or received at the premises of the
addressee (as evidenced, in the case of registered or certified mail, by the
date noted on the return receipt).
SECTION 16. Severability Clause. Any part, provision, representation or
warranty of this Agreement which is prohibited or which is held to be void or
unenforceable shall be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof. Any part,
provision, representation or warranty of this Agreement which is prohibited or
unenforceable or is held to be void or unenforceable in any jurisdiction shall
be ineffective, as to such jurisdiction, to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction as to any Mortgage Loan
shall not invalidate or render unenforceable such provision in any other
jurisdiction. To the extent permitted by applicable law, the parties hereto
waive any provision of law which prohibits or renders void or unenforceable any
provision hereof. If the invalidity of any part, provision, representation or
warranty of this Agreement shall deprive any party of the economic benefit
intended to be conferred by this Agreement, the parties shall negotiate, in
good-faith, to develop a structure the
47
economic effect of which is nearly as possible the same as the economic effect
of this Agreement without regard to such invalidity.
SECTION 17. No Partnership. Nothing herein contained shall be deemed or
construed to create a co-partnership or joint venture between the parties hereto
and the services of Seller shall be rendered as an independent contractor and
not as agent for Purchaser.
SECTION 18. Counterparts and Facsimile Transmission. This Agreement may be
executed simultaneously in any number of counterparts. Each counterpart shall be
deemed to be an original, and all such counterparts shall constitute one and the
same instrument. This Agreement may be delivered via facsimile transmission of
executed counterparts, and each executed counterpart so delivered shall be
deemed an original.
SECTION 19. Governing Law. EXCEPT TO THE EXTENT PREEMPTED BY FEDERAL LAW,
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CHOICE OF LAW RULES OF NEW YORK
OR ANY OTHER JURISDICTION.
SECTION 20. Intention of the Parties. It is the intention of the parties
that Purchaser is purchasing, and Seller is selling, the Mortgage Loans and not
a debt instrument of Seller or another security. Accordingly, the parties hereto
each intend to treat the transaction for federal income tax purposes as a sale
by Seller, and a purchase by Purchaser, of the Mortgage Loans. Purchaser shall
have the right to review the Mortgage Loans and the related Mortgage Files to
determine the characteristics of the Mortgage Loans which shall affect the
federal income tax consequences of owning the Mortgage Loans and Seller shall
cooperate with all reasonable requests made by Purchaser in the course of such
review.
It is not the intention of the parties that such conveyances be deemed a
pledge thereof. However, in the event that, notwithstanding the intent of the
parties, such assets are held to be the property of Seller or if for any other
reason this Agreement is held or deemed to create a security interest in either
such assets, then (i) this Agreement shall be deemed to be a security agreement
within the meaning of the Uniform Commercial Code of the State of New York and
(ii) the conveyances provided for in this Agreement shall be deemed to be an
assignment and a grant by Seller to Purchaser of a security interest in all of
the assets transferred, whether now owned or hereafter acquired.
Purchaser agrees that, when interpreting this Agreement or any other
document delivered by Purchaser to Seller, there shall be no presumption against
Seller on account of the fact that Seller is the party causing the drafting of
this Agreement.
SECTION 21. Successors and Assigns. This Agreement shall bind and inure to
the benefit of and be enforceable by Purchaser, Seller, and the respective
permitted successors and permitted assigns of Purchaser and Seller as set forth
herein.
SECTION 22. Waivers. No term or provision of this Agreement may be waived
or modified unless such waiver or modification is in writing and signed by the
party against whom such waiver or modification is sought to be enforced.
48
SECTION 23. Exhibits. The Exhibits to this Agreement are hereby
incorporated and made a part hereof and are an integral part of this Agreement.
SECTION 24. General Interpretive Principles. For purposes of this
Agreement, except as otherwise expressly provided or unless the context
otherwise requires:
(a) the terms defined in this Agreement have the meanings assigned to them
in this Agreement and include the plural as well as the singular, and the use of
any gender herein shall be deemed to include the other gender;
(b) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;
(c) references herein to "Sections," "Paragraphs" and other subdivisions
without reference to a document are to designated Sections, Paragraphs and other
subdivisions of this Agreement;
(d) the words "herein," "hereof," "hereunder" and other words of similar
import refer to this Agreement as a whole and not to any particular provision;
and
(e) the term "include" or "including" shall mean without limitation by
reason of enumeration.
SECTION 25. Reproduction of Documents. This Agreement and all documents
relating thereto, including, without limitation, (a) consents, waivers and
modifications which may hereafter be executed, (b) documents received by any
party at the closing, and (c) financial statements, certificates and other
information previously or hereafter furnished, may be reproduced by any
photographic, photostatic, microfilm, micro-card, miniature photographic or
other similar process. The parties hereto agree that any such reproduction shall
be admissible in evidence as the original itself in any judicial or
administrative proceeding, whether or not the original is in existence and
whether or not such reproduction was made by a party hereto in the regular
course of business, and that any enlargement, facsimile or further reproduction
of such reproduction shall likewise be admissible in evidence.
SECTION 26. Amendment. This Agreement may be amended from time to time by
Purchaser and Seller by written agreement signed by the parties hereto.
SECTION 27. Confidentiality. Purchaser and Seller shall employ proper
procedures and standards designed to maintain the confidential nature of the
terms of this Agreement, except to the extent: (a) the disclosure thereof is
reasonably believed by such party to be required in connection with regulatory
requirements or other legal requirements relating to its affairs; (b) disclosed
to any one or more of such party's employees, officers, directors, agents,
attorneys or accountants who would have access to the contents of this Agreement
and such data and information in the normal course of the performance of such
person's duties for such party, to the extent such party has procedures in
effect to inform such person of the confidential nature thereof; (c) disclosed
in a prospectus, prospectus supplement or private placement memorandum relating
to a securitization of the Mortgage Loans by Purchaser (or an affiliate assignee
thereof) or to any Person in connection with the resale or proposed resale of
all or a portion of the
49
Mortgage Loans by such party in accordance with the terms of this Agreement; or
(d) reasonably believed by such party to be necessary for the enforcement of
such party's rights under this Agreement.
SECTION 28. Entire Agreement. This Agreement constitutes the entire
agreement and understanding relating to the subject matter hereof between the
parties hereto and any prior oral or written agreements between them shall be
deemed to have merged herewith.
SECTION 29. Further Agreements. Seller and Purchaser each agree to execute
and deliver to the other such reasonable and appropriate additional documents,
instruments or agreements as may be necessary or appropriate to effectuate the
purposes of this Agreement.
SECTION 30. Nonsolicitation. Seller and Purchaser agree that, after the
related Closing Date, neither of them will take any action, directly or through
agents or independent contractors, to solicit the refinancing of any Mortgage
Loan. It is understood and agreed by the parties hereto, however, that (i)
promotions undertaken by Seller or any affiliate of Seller, or Purchaser or any
affiliate of Purchaser, which are directed to the general public, including
without limitation, mass mailings based on commercially acquired mailing lists
or as part of monthly or periodic statements mailed to borrowers or holders of
deposit or other accounts, and newspaper, radio, television, web site
advertisements; or (ii) refinancing resulting from a Mortgagor who, without
impermissible solicitation, contacts Seller or Purchaser in connection with the
refinance of a Mortgage Loan shall not constitute solicitation under this
Section. Notwithstanding any thing to the contrary, the Section shall not
prohibit Seller from soliciting any Mortgagor to provide other services,
including but not limited to, credit cards, insurance, investments, and other
banking related services.
SECTION 31. Financial Statements. Seller understands that in
connection with Purchaser's marketing of the Mortgage Loans, Purchaser shall
make available to prospective purchasers the consolidated financial statements
of LaSalle Bank Corporation for the most recently completed three fiscal years
respecting which such statements are available. Seller also shall make available
any comparable interim statements to the extent any such statements have been
prepared by Seller (and are available upon request to members or stockholders of
Seller or the public at large). Seller, if it has not already done so, agrees to
furnish promptly to Purchaser copies of the statements specified above.
Seller also agrees to allow access to knowledgeable financial, accounting,
origination and servicing officers of Seller for the purpose of answering
questions asked by any prospective purchaser regarding recent developments
affecting Seller, its loan origination or servicing practices or the financial
statements of Seller; provided, however, that (i) Purchaser shall schedule such
meeting reasonably in advance, at a time mutually agreeable with Seller that
will not unduly interfere with Seller's business, (ii) Seller shall not be
liable for any expenses of Purchaser, of any prospective purchaser, or of any
third party engaged by either of them, and (iii) Purchaser shall pay all
reasonable expenses of Seller as agreed to at the time of the scheduling of such
meeting.
SECTION 32. Whole Loan Transfers, Private Securitization Transactions and
Securitization Transactions.
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The Seller and Purchaser agree that with respect to some or all of the
Mortgage Loans purchased on any Closing Date, Purchaser may effect four (4)
Transfers without charge. Purchaser may make additional Transfers; provided,
however, that it pay to Seller a fee for each additional Transfer in the amount
of the greater of $4,000 or 4/32 (0.1250%) of the unpaid principal balance of
the Mortgage Loans transferred in such additional Transfer ("Transfer Fee").
With respect to each Transfer, Purchaser shall give Seller a written notice
of such Transfer setting forth: (i) Seller's applicable Mortgage Loan
identifying number for each Mortgage Loan affected by the Transfer; (ii) the
aggregate scheduled transfer balance of such Mortgage Loans; and (iii) the full
name, address and wiring instructions of the Transferee and the name and
telephone number of an the authorized individual representative for such
Transferee, to whom Sellers should (A) send remittances; (B) send any notices
required by or provided for in this Agreement; and (C) deliver any legal
documents relating to the Mortgage Loans (including but not limited to, contents
of any Mortgage File obtained after the effective date of any assignment.) With
respect to each Transfer, Purchaser shall pay Seller the Transfer Fee if
applicable and execute and deliver to Seller an Assignment, Assumption and
Recognition Agreement in the form of Exhibit 7 hereto for any Whole Loan
Transfer and in the form of Exhibit 8 hereto for any Private Securitization
Transaction or Securitization Transaction; provided, however, that, with respect
to this Agreement or any Mortgage Loan subject of a Transfer, Seller shall be
under no obligation to deal with any Person as Purchaser, other than the
undersigned, unless a duly executed Assignment, Assumption and Recognition
Agreement substantially in the form of Exhibit 7 or Exhibit 8 hereto with
respect to such Transfer, together with the Transfer Fee therefor, if
applicable, has been delivered to Seller. Upon receipt of such duly executed
Assignment, Assumption and Recognition Agreement, and the Transfer Fee therefor,
if applicable, Seller shall ▇▇▇▇ its books and records to reflect the change of
ownership of the Mortgage Loan. Any Transfer made without delivery to Seller of
the appropriate Transfer Fee, if applicable, and Assignment, Assumption and
Recognition Agreement shall be void and of no effect.
With respect to each Transfer Seller agrees:
(1) to reasonably cooperate with the reasonable requests of Purchaser and
a Transferee;
(2) to execute all Reconstitution Agreements provided that each of Seller
and Purchaser is given eight (8) Business Days (or such time as the
parties may otherwise agree) to review and reasonably negotiate in
good faith the content of such documents;
(3) with respect to the Transfer, to bring down the representations and
warranties made by it in Section 6.02;
(4) to deliver to Purchaser for inclusion in any prospectus or other
offering material such publicly available information regarding the
Seller, its financial condition and its mortgage loan delinquency and
foreclosure experience and its underwriting practices;
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(5) to deliver to Purchaser, at the Purchaser's expense, such statements
and audit letters of reputable, certified public accountants
pertaining to information provided by Seller pursuant to clause (4)
above as shall be reasonably requested by Purchaser;
(6) to deliver to Purchaser, and to any Person designated by Purchaser,
such legal documents and in-house opinions of counsel as are
customarily delivered by originators or servicers in connection with
Private Securitization Transactions or Securitization Transactions,
such in-house opinions of counsel to be in the form reasonably
acceptable to Seller and Purchaser, it being understood that the cost
of any opinions of outside special counsel that may be required for a
Private Securitization Transaction or Securitization Transaction shall
be the responsibility of Purchaser;
The form of relevant Reconstitution Agreement to be entered into by
Purchaser and Seller with respect to Transfers shall be reasonably satisfactory
in form and substance to Seller (giving due regard, if necessary, to any
reasonable rating agency or master servicer requirements) and the
representations and warranties, servicing provisions, and indemnity and
liability obligations, contained therein shall be substantially similar to those
contained in this Agreement or in the public disclosure documents of Seller's
own securitizations, unless otherwise mutually agreed by the parties; provided,
however, that no such Reconstitution Agreement or Reconstitution Agreements
shall change or modify, by amendment, incorporation or otherwise, the
representations and warranties set forth in this Agreement.
It is expressly understood that, in any Reconstitution Agreement, whether
or not incorporated into an Assignment, Assumption and Recognition Agreement,
Seller is not required to:
(a) except as set forth in this Agreement, contract with or indemnify any
underwriter, any master servicer, sub-master servicer, trustee,
custodian or any other Person other than Purchaser, and that no other
party shall be a third party beneficiary thereof;
(b) enter into a servicing agreement other than this Agreement, or service
the Mortgage Loans according to servicing guidelines other than the
Servicing Guidelines as defined herein;
(c) increase its liability, servicing obligations or procedures without
its consent and adequate additional compensation therefor;
(d) decrease its fees or other income from servicing;
(e) make any Rule 10b-5 type of representations, warranties, or
indemnities, except to Purchaser and its underwriter and only for
information provided by Seller, in the complete form provided by
Seller, for inclusion in a prospectus, free writing prospectus or
prospectus supplement, and only provided that Seller receive, in turn,
from an affiliated indemnifier acceptable to Seller, which has
financial strength satisfactory to Seller, and in a writing in the
form of Exhibit 9 hereto,
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cross-indemnities for any loss or damages as a result of all other
information in such prospectus, free writing prospectus or prospectus
supplement; or
(f) bring down or restate any representations and warranties set forth in
Sections 6.01 of this Agreement.
Seller shall not be obligated to execute, or liable for refusing to
execute, any Reconstitution Agreement not in conformance with the parameters for
Reconstitution Agreements set forth in Sections 32 and 33, including in the
definition of Reconstitution Agreement. Purchaser shall cooperate with Seller in
connection with any Transfer contemplated by Purchaser pursuant to this Section
32, and shall promptly negotiate and respond to reasonable requests of Seller
for changes to any proposed Reconstitution Agreement, including to the documents
referred to or incorporated therein, needed to conform to the parameters for
Reconstitution Agreements set forth herein, including in the definition of
Reconstitution Agreement, or shall extend the eight (8) Business Day period
therefor in order to allow sufficient time to obtain such mutually agreed upon
Reconstitution Agreement.
All Mortgage Loans not sold or transferred pursuant to a Whole Loan
Transfer, Private Securitization Transaction or Securitization Transaction shall
be subject to this Agreement and shall continue to be serviced in accordance
with the terms of this Agreement.
SECTION 33. Compliance with Regulation AB.
Subsection 33.01. Intent of the Parties; Reasonableness.
The Purchaser and the Seller acknowledge and agree that the purpose of
Section 33 of this Agreement is to facilitate compliance by the Purchaser and
any Depositor with the provisions of Regulation AB and related rules and
regulations of the Commission. Neither the Purchaser nor any Depositor shall
exercise its right to request delivery of information or other performance under
these provisions other than in good faith, or for purposes other than compliance
with the Securities Act of 1933, the Exchange Act and, in each case, the rules
and regulations of the Commission thereunder and the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act. The
Seller acknowledges that interpretations of the requirements of Regulation AB
may change over time, due to interpretive guidance provided by the Commission or
its staff, and agrees to comply with requests made by the Purchaser or
Purchaser's Agent in good faith for delivery of information under these
provisions on the basis of established and evolving interpretations of
Regulation AB. In connection with any Securitization Transaction, the Seller
shall cooperate fully with the Purchaser and Purchaser's Agent to deliver to the
Purchaser or Purchaser's Agent any and all statements, reports, certifications,
records and any other information necessary in the reasonable determination of
the Purchaser or Purchaser's Agent to permit the Purchaser or Purchaser's Agent
to comply with the provisions of Regulation AB, together with such disclosures
relating to the Seller, any Subservicer, any Third-Party Originator and the
Mortgage Loans, or the servicing of the Mortgage Loans, reasonably believed by
the Purchaser or any Depositor to be necessary in order to effect such
compliance.
The Purchaser and Purchaser's Agent shall cooperate with the Seller by
providing timely notice of requests for information under these provisions and
by reasonably limiting such
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requests to information required, in the Purchaser's reasonable judgment, to
comply with Regulation AB. In the event that any threshold percentages with
respect to the Seller or any of the Seller's Subservicers or Subcontractors
change in a Securitization Transaction, due to payoffs or otherwise, such that
the Seller or any of the Seller's Subservicers or Subcontractors would be
required to provide information pursuant to this Section 33 not theretofore
required, Purchaser or Purchaser's Agent shall give the Seller prompt notice of
any such threshold percentage changes.
Subsection 33.02. Additional Representations and Warranties of the Seller.
(a) The Seller hereby represents to the Purchaser and Purchaser's Agent as
of the date on which information is first provided to the Purchaser or
Purchaser's Agent under Subsection 33.03 that, except as disclosed in writing to
the Purchaser or Purchaser's Agent prior to such date: (i) the Seller is not
aware and has not received notice that any default, early amortization or other
performance triggering event has occurred as to any other securitization due to
any act or failure to act of the Seller; (ii) the Seller has not been terminated
as servicer in a residential mortgage loan securitization, either due to a
servicing default or to application of a servicing performance test or trigger;
(iii) no material noncompliance with the applicable servicing criteria with
respect to other securitizations of residential mortgage loans involving the
Seller as servicer has been disclosed or reported by the Seller; (iv) no
material changes to the Seller's policies or procedures with respect to the
servicing function it will perform under this Agreement and any Reconstitution
Agreement for mortgage loans of a type similar to the Mortgage Loans have
occurred during the three-year period immediately preceding the related
Securitization Transaction; (v) there are no aspects of the Seller's financial
condition that could have a material adverse effect on the performance by the
Seller of its servicing obligations under this Agreement or any Reconstitution
Agreement; (vi) there are no material legal or governmental proceedings pending
(or known to be contemplated) against the Seller, any Subservicer or any
Third-Party Originator; and (vii) there are no affiliations, relationships or
transactions relating to the Seller, any Subservicer or any Third-Party
Originator with respect to any Securitization Transaction and any party thereto
identified by the related Depositor of a type described in Item 1119 of
Regulation AB.
(b) If so requested by the Purchaser or Purchaser's Agent on any date
following the date on which information is first provided to the Purchaser or
Purchaser's Agent under Subsection 33.03, the Seller shall, within five (5)
Business Days following such request, confirm in writing the accuracy of the
representations and warranties set forth in paragraph (a) of this Section or, if
any such representation and warranty is not accurate as of the date of such
request, provide reasonably adequate disclosure of the pertinent facts, in
writing, to the requesting party.
Subsection 33.03. Information to Be Provided by the Seller.
In connection with any Securitization Transaction, provided Seller receives
a written request from Purchaser identifying the Mortgage Loans in the
Securitization Transaction, notifying Seller that the Mortgage Loans meet the
threshold percentages of Regulation AB, and stating those percentages, the
Seller shall (i) within five (5) Business Days following request by the
Purchaser or any Depositor, provide to the Purchaser and such Depositor (or, as
applicable, cause each Third-Party Originator and each Subservicer to provide),
in writing and in form and
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substance reasonably satisfactory to the Purchaser and such Depositor, the
information and materials specified in paragraphs (a), (b) and (c) of this
Subsection that pertain to the Securitization Transaction, and (ii) as promptly
as practicable following notice to or discovery by the Seller, provide to the
Purchaser and any Depositor (in writing and in form and substance reasonably
satisfactory to the Purchaser and such Depositor) the information specified in
paragraph (d) of this Subsection.
(a) If so requested by the Purchaser or any Depositor, and necessary for
compliance with Regulation AB, the Seller shall provide such information
regarding (i) the Seller, as originator of the Mortgage Loans (including as an
acquirer of Mortgage Loans from a Qualified Correspondent), or (ii) each
Third-Party Originator, and (iii) as applicable, each Subservicer, as is
requested for the purpose of compliance with Items 1105, 1110, 1117 and 1119 of
Regulation AB. Such information shall include:
(A) the originator's form of organization;
(B) to the extent material, a description of the originator's
origination program and how long the originator has been engaged in originating
residential mortgage loans, which description shall include a discussion of the
originator's experience in originating mortgage loans of a similar type as the
Mortgage Loans if material; information regarding the size and composition of
the originator's origination portfolio; and information that may be material, in
the judgment of the Purchaser or any Depositor, to an analysis of the
performance of the Mortgage Loans, including the originators' credit-granting or
underwriting criteria for mortgage loans of similar type(s) as the Mortgage
Loans and such other information as the Purchaser or any Depositor may
reasonably request for the purpose of compliance with Item 1110(b)(2) of
Regulation AB;
(C) a description of any material legal proceedings pending (or known
to be contemplated by governmental authorities) against the Seller, each
Third-Party Originator and each Subservicer that is material to security
holders; and
(D) a description of any affiliation or relationship between the
Seller, each Third-Party Originator, each Subservicer and any of the following
parties to a Securitization Transaction, as such parties are identified to the
Seller by the Purchaser or any Depositor in writing in advance of such
Securitization Transaction:
(1) any servicer;
(2) any trustee;
(3) any originator;
(4) any significant obligor;
(5) any enhancement or support provider; and
(6) any other material transaction party.
(b) If so requested by the Purchaser or any Depositor and necessary for
compliance with Regulation AB, the Seller shall provide (or, as applicable,
cause each Third-Party Originator to provide) Static Pool Information with
respect to the mortgage loans (of a similar type as the Mortgage Loans, as
reasonably identified by the Purchaser as provided below)
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originated by (i) the Seller, if the Seller is an originator of Mortgage Loans
(including as an acquirer of Mortgage Loans from a Qualified Correspondent),
and/or (ii) each Third-Party Originator. Such Static Pool Information shall be
prepared by the Seller (or Third-Party Originator) on the basis of its
reasonable, good faith interpretation of the requirements of Item 1105 of
Regulation AB. The content of such Static Pool Information may be in the form
customarily provided by the Seller, and need not be customized for the Purchaser
or any Depositor. Such Static Pool Information for each vintage origination year
or prior securitized pool, as applicable, shall be presented in increments no
less frequently than quarterly. The most recent periodic increment must be as of
a date no later than one hundred thirty-five (135) days prior to the date of the
prospectus or other offering document in which the Static Pool Information is to
be included or incorporated by reference. The Static Pool Information shall be
provided in an electronic format that provides a permanent record of the
information provided, such as a portable document format (pdf) file, or other
such electronic format agreeable to Seller and the Purchaser or the Depositor,
as applicable.
Promptly following notice or discovery of a material error in Static Pool
Information provided pursuant to the immediately preceding paragraph (including
an omission to include therein information required to be provided pursuant to
such paragraph), the Seller shall provide corrected Static Pool Information to
the Purchaser or any Depositor, as applicable, in the same format in which
Static Pool Information was previously provided to such party by the Seller.
If so requested by the Purchaser or any Depositor, the Seller shall provide
(or, as applicable, cause each Third-Party Originator to provide), at the
expense of the requesting party (to the extent of any additional incremental
expense associated with delivery pursuant to this Agreement), such agreed-upon
procedures letters of certified public accountants pertaining to Static Pool
Information relating to prior securitized pools for securitizations closed on or
after January 1, 2006 or, in the case of Static Pool Information with respect to
the Seller's or Third-Party Originator's originations or purchases, to calendar
months commencing January 1, 2006, as the Purchaser or such Depositor shall
reasonably request. Such letters shall be addressed to and be for the benefit of
such parties as the Purchaser or such Depositor shall designate, which may
include, by way of example, any Sponsor, any Depositor and any broker dealer
acting as underwriter, placement agent or initial purchaser with respect to a
Securitization Transaction. Any such statement or letter may take the form of a
standard, generally applicable document accompanied by, or including, a reliance
letter authorizing reliance by the addressees designated by the Purchaser or
such Depositor.
(c) If so requested by the Purchaser or any Depositor and necessary for
compliance with Regulation AB, the Seller shall provide such information
regarding the Seller, as servicer of the Mortgage Loans, and each Subservicer
(each of the Seller and each Subservicer, for purposes of this paragraph, a
"Servicer"), as is requested for the purpose of compliance with Items 1108,
1111, 1117 and 1119 of Regulation AB. Such information shall include:
(A) the Servicer's form of organization;
(B) a description of how long the Servicer has been servicing
residential mortgage loans; a general discussion of the Servicer's experience in
servicing assets of any type as well as a more detailed discussion of the
Servicer's experience in, and procedures for, the
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servicing function it will perform under this Agreement and any applicable
Reconstitution Agreements; information regarding the size, composition and
growth of the Servicer's portfolio of residential mortgage loans of a type
similar to the Mortgage Loans and information on factors related to the Servicer
that may be material, in the reasonable judgment of the Purchaser or any
Depositor, to any analysis of the servicing of the Mortgage Loans or the related
asset-backed securities, as applicable, including, without limitation:
(1) whether any prior securitizations of mortgage loans of a type
similar to the Mortgage Loans involving the Servicer have defaulted or
experienced an early amortization or other performance triggering event because
of servicing during the three-year period immediately preceding the related
Securitization Transaction;
(2) the extent of any material outsourcing the Servicer utilizes;
(3) whether there has been previous disclosure of material
noncompliance with the applicable servicing criteria with respect to other
securitizations of residential mortgage loans involving the Servicer as a
servicer during the three-year period immediately preceding the related
Securitization Transaction;
(4) whether the Servicer has been terminated as servicer in a
residential mortgage loan securitization, either due to a servicing default or
to application of a servicing performance test or trigger; and
(5) such other information as the Purchaser or any Depositor may
reasonably request for the purpose of compliance with Item 1108(b)(2) of
Regulation AB;
(C) a description of any material changes during the three-year period
immediately preceding the related Securitization Transaction to the Servicer's
policies or procedures with respect to the servicing function it will perform
under this Agreement and any applicable Reconstitution Agreements for mortgage
loans of a type similar to the Mortgage Loans;
(D) information regarding the Servicer's financial condition, to the
extent that there is a material risk that an adverse financial event or
circumstance involving the Servicer could have a material adverse effect on the
performance by the Seller of its servicing obligations under this Agreement or
any applicable Reconstitution Agreement;
(E) information regarding advances made by the Servicer on the
Mortgage Loans and the Servicer's overall servicing portfolio of residential
mortgage loans for the three-year period immediately preceding the related
Securitization Transaction, which may be limited to a statement by an authorized
officer of the Servicer to the effect that the Servicer has made all advances
required to be made on residential mortgage loans serviced by it during such
period, or, if such statement would not be accurate, information regarding the
percentage and type of advances not made as required, and the reasons for such
failure to advance;
(F) a description of the Servicer's processes and procedures designed
to address any special or unique factors involved in servicing loans of a
similar type as the Mortgage Loans;
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(G) a description of the Servicer's processes for handling
delinquencies, losses, bankruptcies and recoveries, such as through liquidation
of mortgaged properties, sale of defaulted mortgage loans or workouts;
(H) information as to how the Servicer defines or determines
delinquencies and charge-offs, including the effect of any grace period,
re-aging, restructuring, partial payments considered current or other practices
with respect to delinquency and loss experience;
(I) a description of any material legal proceedings pending (or known
to be contemplated by governmental authorities) against the Servicer that is
material to security holders;
(J) a description of any affiliation or relationship between the
Servicer and any of the following parties to a Securitization Transaction, as
such parties are identified to the Servicer by the Purchaser or any Depositor in
writing in advance of such Securitization Transaction:
(1) any servicer;
(2) any trustee;
(3) any originator;
(4) any significant obligor;
(5) any enhancement or support provider; and
(6) any other material transaction party.
(K) historical delinquency information with respect to the Mortgage
Loans since origination of the Mortgage Loans.
(d) For the purpose of satisfying the reporting obligation under the
Exchange Act with respect to any class of asset-backed securities, the Seller
shall (or shall cause each Subservicer and Third-Party Originator to) (i)
provide prompt notice to the Purchaser and Purchaser's Agent in writing of (A)
any legal proceedings pending (or known to be contemplated by governmental
authorities) against the Seller, any Subservicer or any Third-Party Originator
that is material to security holders, (B) any affiliations or relationships that
develop following the closing date of a Securitization Transaction between the
Seller, any Subservicer or any Third-Party Originator and any of the parties
specified in clause (D) of paragraph (a) of this Subsection (and any other
parties identified in writing by the requesting party) with respect to such
Securitization Transaction, (C) any Event of Default under the terms of this
Agreement or any applicable Reconstitution Agreement, (D) any merger,
consolidation or sale of substantially all of the assets of the Seller, and (E)
the Seller's entry into an agreement with a Subservicer or Subcontractor to
perform or assist in the performance of any of the Seller's obligations under
this Agreement or any Reconstitution Agreement and (ii) provide to the Purchaser
and any Depositor a description of such proceedings, affiliations or
relationships.
(e) If Seller or any Subservicer as servicer or subservicer under this
Agreement or any applicable Reconstitution Agreement related thereto is to be
merged or consolidated into any Person, or any Person is to be appointed as a
successor to the Seller or any Subservicer, the Seller shall provide to the
Purchaser and any Depositor, at least 15 calendar days prior to the
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effective date of such succession or appointment, (x) written notice to the
Purchaser and any Depositor of such succession or appointment and (y) at least
13 calendar days prior to such effective date, all information reasonably
requested by the Purchaser or any Depositor in order to comply with the
Depositor's reporting obligation under Item 6.02 of Form 8-K with respect to any
class of asset-backed securities.
(f) In respect to any Securitization Transaction that includes the Mortgage
Loans serviced by Seller or any Subservicer, as applicable, as part of its
regular monthly report to Purchaser or Purchaser's Agent, Servicer shall include
the following such information and data for purposes of compliance with Item
1121 of Regulation AB:
(A) any material modifications, extensions or waivers of terms, fees,
penalties or payments of the Mortgage Loans in the pool assets during the
distribution period or that have cumulatively become material over time;
(B) material breaches of the representations or warranties or
transaction covenants with respect to the Mortgage Loans in the pool assets; and
(C) information regarding new asset-backed securities issuances backed
by the same Mortgage Loans in the pool assets, any changes to the Mortgage Loans
in the pool assets (such as, additions, substitutions or repurchases), and any
material changes in origination, underwriting or other criteria for acquisition
or selection of Mortgage Loans in the pool assets.
(g) The Seller shall provide to the Purchaser or Purchaser's Agent evidence
of the authorization of the person signing any certification.
Subsection 33.04. Servicer Compliance Statement.
On or before March 1 of each calendar year, commencing in 2007, the Seller
shall deliver to the Purchaser or Purchaser's Agent a statement of compliance
addressed to the Purchaser or Purchaser's Agent and signed by an authorized
officer of the Seller, to the effect that (i) a review of the Seller's
activities during the immediately preceding calendar year (or applicable portion
thereof) and of its performance under this Agreement and any applicable
Reconstitution Agreement during such period has been made under such officer's
supervision, and (ii) to the best of such officers' knowledge, based on such
review, the Seller has fulfilled all of its obligations under this Agreement and
any applicable Reconstitution Agreement in all material respects throughout such
calendar year (or applicable portion thereof) or, if there has been a failure to
fulfill any such obligation in any material respect, specifically identifying
each such failure known to such officer and the nature and the status thereof.
Subsection 33.05. Report on Assessment of Compliance and Attestation.
On or before March 1 of each calendar year, commencing in 2007, the Seller
shall:
(i) deliver to the Purchaser or Purchaser's Agent a report regarding
the Seller's assessment of compliance with the Servicing Criteria during
the immediately preceding calendar year, as required under Rules 13a-18 and
15d-18 of the Exchange Act and Item 1122 of Regulation AB. Such report
shall be addressed to the Purchaser or
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Purchaser's Agent and signed by an authorized officer of the Seller, shall
address each of the "Applicable Servicing Criteria" specified on Exhibit 11
hereto, and shall disclose the inapplicability of any servicing criteria
denoted as inapplicable with a "No" as specified on Exhibit 11 hereto;
(ii) deliver to the Purchaser or Purchaser's Agent a report of a
registered public accounting firm that attests to, and reports on, the
assessment of compliance made by the Seller and delivered pursuant to the
preceding paragraph. Such attestation shall be in accordance with Rules
1-02(a)(3) and 2-02(g) of Regulation S-X under the Securities Act of 1933
and the Exchange Act;
(iii) cause each Subservicer, and each Subcontractor determined by the
Seller pursuant to Subsection 33.06(b) to be "participating in the
servicing function" within the meaning of Item 1122 of Regulation AB, and,
to the extent required of such Subservicer or Subcontractor under Item 1123
of Regulation AB, an annual compliance certificate as and when provided by
Section 33.04, to deliver to the Purchaser or Purchaser's Agent an
assessment of compliance and accountants' attestation as and when provided
in paragraphs (a) and (b) of this Subsection; and
(iv) if requested by the Purchaser or Purchaser's Agent not later than
February 1 of the calendar year in which such certification is to be
delivered, deliver, and cause each Subservicer and Subcontractor described
in clause (iii) above to deliver, to the Purchaser or Purchaser's Agent and
any other Person that will be responsible for signing the certification (a
"Sarbanes Certification") required by Rules 13a-14(d) and 15d-14(d) under
the Exchange Act (pursuant to Section 302 of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of
2002) on behalf of an asset-backed issuer with respect to a Securitization
Transaction a certification, signed by the appropriate officer of the
Seller, in the form attached hereto as Exhibit 10.
The Seller acknowledges that the parties identified in clause (a)(iv) above
may rely on the certification provided by the Seller pursuant to such clause in
signing a Sarbanes Certification and filing such with the Commission. Neither
the Purchaser nor Purchaser's Agent will request delivery of a certification
under clause (a)(iv) above unless a Depositor is required under the Exchange Act
to file an annual report on Form 10-K or any amendment thereto with respect to
an issuing entity whose asset pool includes Mortgage Loans.
Each assessment of compliance provided by a Subservicer pursuant to
Subsection 33.05(a)(i) shall address each of the Servicing Criteria specified on
a certification substantially in the form of Exhibit 11 hereto delivered to the
Purchaser concurrently with the execution of this Agreement or, in the case of a
Subservicer subsequently appointed as such, on or prior to the date of such
appointment. An assessment of compliance provided by a Subcontractor pursuant to
Subsection 33.05(a)(iii) need not address any elements of the Servicing Criteria
other than those specified by the Seller pursuant to Subsection 33.06.
Subsection 33.06. Use of Subservicers and Subcontractors.
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The Seller shall not hire or otherwise utilize the services of any
Subservicer to fulfill any of the obligations of the Seller as servicer under
this Agreement or any Reconstitution Agreement unless the Seller complies with
the provisions of this Subsection. The Seller shall not hire or otherwise
utilize the services of any Subcontractor, and shall not permit any Subservicer
to hire or otherwise utilize the services of any Subcontractor, to fulfill any
of the obligations of the Seller as servicer under this Agreement or any
Reconstitution Agreement unless the Seller complies with the provisions of this
Subsection.
It shall not be necessary for the Seller to seek the consent of the
Purchaser or Purchaser's Agent to the utilization of any Subservicer. If
necessary for compliance with Regulation AB, and after reasonable notice from
Purchaser of the parties involved in Purchaser's Securitization Transaction and
their threshold percentage involvement, Seller shall cause any Subservicer used
by the Seller (or by any Subservicer) for the benefit of the Purchaser and any
Depositor to comply with the provisions of this Subsection and with Subsections
33.03(c), (e), (f) and (g), 33.04 and 33.05 of this Agreement to the same extent
as if such Subservicer were the Seller, and to provide the information required
with respect to such Subservicer under Subsection 33.03(d) of this Agreement.
Without regard to any threshold percentage specified in Item 1122(d) of
Regulation AB, the Seller shall be responsible for obtaining from each
Subservicer and delivering to the Purchaser and any Depositor any servicer
compliance statement required to be delivered by such Subservicer under
Subsection 33.04, any assessment of compliance and attestation required to be
delivered by such Subservicer under Subsection 33.05 and any certification
required to be delivered to the Person that will be responsible for signing the
Sarbanes Certification under Subsection 33.05 as and when required to be
delivered.
It shall not be necessary for the Seller to seek the consent of the
Purchaser or Purchaser's Agent to the utilization of any Subcontractor. If
necessary for compliance with Regulation AB, and after reasonable notice from
Purchaser of the parties involved in Purchaser's Securitization Transaction and
their threshold percentage involvement, Seller shall promptly upon request
provide to the Purchaser or Purchaser's Agent a written description of the role
and function of each Subcontractor utilized by the Seller or any Subservicer
"participating in the servicing function" within the meaning of Item 1122 of
Regulation AB, and (iii) which elements of the Servicing Criteria will be
addressed in assessments of compliance provided by each Subcontractor identified
pursuant to clause (ii) of this paragraph.
Seller shall cause any such Subcontractor used by the Seller (or by any
Subservicer) for the benefit of the Purchaser and any Depositor to comply with
the provisions of Subsection 33.05 of this Agreement. The Seller shall be
responsible for obtaining from each Subcontractor and delivering to the
Purchaser and any Depositor any assessment of compliance and attestation and the
other certifications required to be delivered by such Subcontractor under
Subsection 33.05, in each case as and when required to be delivered pursuant to
this Agreement.
With respect to any Subservicer or Subcontractor, the Seller shall provide
the indemnifications set forth in Subsection 33.07(b)(i) and (ii) of this
Agreement on behalf of such Subservicer or Subcontractor. With respect to the
Subservicer only, the Seller shall (i) represent and warrant to the Purchaser
that no Subservicer is in breach of any of the representations set forth in
Subsection 33.02(a) of this Agreement or disclose otherwise, in writing, to the
Purchaser,
61
and (ii) provide such information as may be requested pursuant to Subsection
33.02(b) of this Agreement.
Subsection 33.07. Indemnification; Remedies.
(a) (i) With respect to all information, reports, certifications, and any
other materials required to be delivered by or on behalf of Seller and each
Subservicer, Subcontractor and Third-Party Originator pursuant to this Section
33 (collectively, the "Seller Information") for inclusion in any offering
materials related to a Securitization Transaction, including the registration
statement, prospectus, prospectus supplement, free writing prospectus, any
offering circular, or similar offering document and any amendments or
supplements to the foregoing (collectively, the "Securitization Materials"),
Seller agrees to execute an indemnification agreement, substantially in the form
and substance of Exhibit 9 hereto, pursuant to which Seller shall indemnify
Purchaser, its affiliates and certain other parties for the matters set forth in
such indemnification agreement; only provided that Seller receive in turn, from
a Purchaser affiliated indemnifier acceptable to Seller, which has financial
strength satisfactory to Seller, the cross-indemnities identified substantially
in the form and substance of Exhibit 9 hereto.
(ii) With respect to Seller Information (other than the Seller Information
included in Securitization Materials) required to be delivered pursuant to this
Section 33 for inclusion in reports, forms, filings or other disclosures made
pursuant to the Exchange Act, Seller shall indemnify (i) Purchaser, Purchaser's
affiliates and Purchaser's Agents responsible for the preparation, execution or
filing of any report required to be filed with the Commission with respect to
such Securitization Transaction, or for execution of a certification pursuant to
Rule 13a-14(d) or Rule 15d-14(d) under the Exchange Act for a related
Securitization Transaction, and (ii) with respect to the Securitization
Transaction for which such Seller Information was required to be provided, the
related sponsor, issuing entity, depositor, or broker dealer acting as
underwriter, and shall hold each of them harmless from and against any losses,
damages, penalties, fines, forfeitures, legal fees and expenses and related
costs, judgments, and any other costs, fees and expenses that any of them may
sustain arising out of or based upon (y) any untrue statement of a material fact
contained in any Seller Information and the omission to state in the Seller
Information a material fact required to be stated in the Seller Information or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading and (z) the failure to
deliver any such Seller Information when and as required under this Section 33.
(iii) With respect to all other Seller Information required to be delivered
pursuant to this Section 33, Seller shall indemnify (i) Purchaser, Purchaser's
affiliates and Purchaser's Agents responsible for the preparation, execution or
filing of any report required to be filed with the Commission with respect to
such Securitization Transaction, or for execution of a certification pursuant to
Rule 13a-14(d) or Rule 15d-14(d) under the Exchange Act for a related
Securitization Transaction, (ii) with respect to the Securitization Transaction
for which such Seller Information was required to be provided, the related
sponsor, issuing entity, depositor, or broker dealer acting as underwriter, and
shall hold each of them harmless from and against any losses, damages,
penalties, fines, forfeitures, legal fees and expenses and related costs,
judgments, and any other costs, fees and expenses that any of them may sustain
arising out of or based upon (x) any untrue statement of a material fact
contained in any Seller Information and
62
the omission to state in the Seller Information a material fact required to be
stated in the Seller Information or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, (y) the failure to deliver any such Seller Information when and as
required under this Section 33 and (z) a breach of any representation or
warranty set forth in, or furnished in a writing pursuant to, Section 33.02.
(iv) The indemnities in this Section 33.07 shall survive termination of
this Agreement. If the indemnification provided for herein is determined by a
court of competent jurisdiction to be unenforceable, then the indemnifying party
agrees that it shall contribute to the amount paid or payable by the indemnified
party as a result of any claims, losses, damages or liabilities incurred by such
indemnified party in such proportion as is appropriate to reflect the relative
fault of such indemnified party on the one hand and the indemnifying party on
the other.
(b) (i) Any failure by the Seller, any Subservicer, any Subcontractor or
any Third-Party Originator to deliver any information, report, certification,
accountants' letter or other material when and as required under this Section
33, or any breach by the Seller of a representation or warranty set forth in
Subsection 33.02(a) or in a writing furnished pursuant to Subsection 33.02(b)
and made as of a date prior to the closing date of the related Securitization
Transaction, to the extent that such breach is not cured by such closing date,
or any breach by the Seller of a representation or warranty in a writing
furnished pursuant to Subsection 33.02(b) to the extent made as of a date
subsequent to such closing date, shall, except as provided in clause (ii) of
this paragraph, immediately and automatically, without notice or grace period,
constitute an Event of Default with respect to the Seller under this Agreement
and any applicable Reconstitution Agreement, and shall entitle the Purchaser or
Purchaser's Agent, as applicable, to terminate the rights and obligations of the
Seller as servicer under this Agreement and/or any applicable Reconstitution
Agreement and if the Servicer is servicing any of the Mortgage Loans in a
Securitization Transaction, appoint a successor servicer, in accordance with the
related securitization agreement, reasonably acceptable to any Master Servicer
of such Securitization Transaction; provided that to the extent that any
provision of this Agreement and/or any applicable Reconstitution Agreement
expressly provides for the survival of certain rights or obligations following
termination of the Seller as servicer, such provision shall be given effect.
(ii) Any failure by the Seller, any Subservicer or any Subcontractor to
deliver any information, report, certification or accountants' letter when and
as required under Subsections 33.04 or 33.05, including (except as provided in
the following paragraph) any failure by the Seller to identify pursuant to
Subsection 33.06(b) any Subcontractor "participating in the servicing function"
within the meaning of Item 1122 of Regulation AB, which continues unremedied for
ten (10) calendar days after the date on which such information, report,
certification or accountants' letter was required to be delivered shall
constitute an Event of Default with respect to the Seller under this Agreement
and any applicable Reconstitution Agreement, and shall entitle the Purchaser or
Purchaser's Agent, as applicable, to terminate the rights and obligations of the
Seller as servicer under this Agreement and/or any applicable Reconstitution
Agreement; provided that to the extent that any provision of this Agreement
and/or any applicable Reconstitution Agreement expressly provides for the
survival of certain rights or obligations following termination of the Seller as
servicer, such provision shall be given effect.
63
Neither the Purchaser nor any Depositor shall be entitled to terminate the
rights and obligations of the Seller pursuant to this subparagraph (b)(ii) if a
failure of the Seller to identify a Subcontractor "participating in the
servicing function" within the meaning of Item 1122 of Regulation AB was
attributable solely to the role or functions of such Subcontractor with respect
to mortgage loans other than the Mortgage Loans.
(iii) The Seller shall promptly reimburse the Purchaser (or any designee of
the Purchaser, such as a master servicer) and any Depositor, as applicable, for
all reasonable expenses incurred by the Purchaser (or such designee) or such
Depositor, in connection with the termination of the Seller as servicer and the
transfer of servicing of the Mortgage Loans to a successor servicer. The
provisions of this paragraph shall not limit whatever rights the Purchaser or
any Depositor may have under other provisions of this Agreement and/or any
applicable Reconstitution Agreement or otherwise, whether in equity or at law,
such as an action for damages, specific performance or injunctive relief.
SECTION 34. JURY WAIVER. EACH PARTY ACKNOWLEDGES THAT THE RIGHT OF TRIAL BY
JURY IS A CONSTITUTIONAL RIGHT, BUT ONE THAT MAY BE WAIVED. EACH PARTY, AFTER
CONSULTING (OR HAVING HAD THE OPPORTUNITY TO CONSULT) WITH LEGAL COUNSEL OF ITS
CHOICE, KNOWINGLY AND VOLUNTARILY, FOR ITS OWN BENEFIT, WAIVES ANY RIGHT TO
TRIAL BY JURY IN THE EVENT OF LITIGATION IN ANY WAY RELATED TO THIS AGREEMENT,
PERFORMANCE THEREUNDER, AND/OR ENFORCEMENT THEREOF.
64
Purchaser and Seller have caused their names to be signed hereto by their
respective officers thereunto duly authorized as of the date first above
written.
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE LENDING, INC.,
as Purchaser
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
ABN AMRO MORTGAGE GROUP, INC.,
as Seller
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
65
EXHIBIT 1
MORTGAGE LOAN DOCUMENTS
With respect to each Mortgage Loan, as of the related Closing Date, the
Mortgage Loan Documents shall consist of the following:
(a) the original Mortgage Note bearing all intervening endorsements,
endorsed in blank and signed in the name of Seller by an officer
thereof, or in the event the Mortgage Note has been lost or destroyed,
a lost note affidavit with indemnification;
(b) the original Assignment of Mortgage with assignee's name left blank;
(c) the originals of all assumption, modification, consolidation or
extension agreements, if any, with evidence of recording thereon; or
if such documents have not been returned from the applicable recording
office or have been lost, a true and complete copy of the original;
(d) the original Mortgage, or imaged copy of the recorded Mortgage, with
evidence of recording thereon, or if any such Mortgage has not been
returned from the applicable recording office or has been lost, or if
such public recording office retains the original recorded Mortgage, a
true and complete copy of the original Mortgage;
(e) the originals of all intervening assignments of mortgage, or imaged
copies of the recorded documents, with evidence of recording thereon,
or if any such intervening assignment of mortgage has not been
returned from the applicable recording office or has been lost or if
such public recording office retains the original recorded assignments
of mortgage, a true and complete copy of the original intervening
assignment of mortgage; and
(f) the original mortgagee title insurance policy or if not yet issued, a
copy of the title commitment with proof of payment, or imaged copies
thereof.
EXHIBIT 2
CONTENTS OF EACH MORTGAGE FILE
With respect to each Mortgage Loan, the Mortgage File, which may be an
image thereof, shall include each of the following items, unless otherwise
disclosed to Purchaser on the data tape:
(a) Copies of the Mortgage, Mortgage Note and title policy or commitment.
(b) Residential loan application.
(c) Mortgage Loan closing statement.
(d) Verification of employment and income, if required.
(e) Verification of acceptable evidence of source and amount of down
payment, if required.
(f) Credit report on Mortgagor, in a form acceptable to the Agency.
(g) Residential appraisal report in a form acceptable to the Agency, if
required.
(h) Photograph of the Mortgaged Property, if required.
(i) Survey of the Mortgaged Property, unless a survey is not required.
(j) Copies of all required disclosure statements.
(k) Sales contract, if applicable and required.
(l) The Primary Mortgage Insurance Policy or certificate of insurance or
electronic notation of the existence of such policy, where required.
(m) Evidence of electronic notation of the hazard insurance policy, and,
if required by law, evidence of the flood insurance policy.
EXHIBIT 3
SELLER'S OFFICER'S CERTIFICATE
I, ______________________________, hereby certify that I am duly appointed
___________________________ of ABN AMRO Mortgage Group, Inc. (the "Seller"), and
further certify on behalf of the Seller as follows:
1. The Seller is in good standing in its State of formation. Attached hereto
as Exhibit A is a Certificate of Good Standing of Seller dated ___________.
No event has occurred since _______________, which has affected the good
standing of Seller under the laws of the State of Delaware.
2. Attached hereto as Exhibit B is a true and complete copy of the Amended and
Restated By-Laws of the Seller. Such By-Laws have not been amended or
revoked and are in full force and effect on the date hereof.
3. Section 11.1 of the Amended and Restated By-Laws, entitled "Execution of
Instruments," authorizes any Vice President, First Vice President, or
Senior Vice President of the Seller, among others, to execute and deliver
documents in connection with the sale, assignment, transfer, conveyance,
management or handling in any way of any property held or controlled by the
Seller,
4. Each person who, as an officer of the Seller, signed (a) the Master
Mortgage Loan Sale and Servicing Agreement (the "Agreement") dated as of
October 1, 2006, by and between the ▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE LENDING, INC.
and ABN AMRO Mortgage Group, Inc., a Delaware corporation, (b) the
commitment letter dated ____________, (the "Commitment Letter") and (c) any
other document delivered prior hereto or on the date hereof in connection
with the purchase and sale and servicing of Mortgage Loans in accordance
with the Agreement was, at the respective times of such signing and
delivery, and is as of the date hereof, duly elected or appointed,
qualified and acting as such officer.
5. Set forth below is the name, title and specimen signature of the person who
has been duly appointed and qualified to serve in the capacity set forth
opposite his or her name:
Name Title Signature
------------------------- ------------------------ -------------------------
The signature of each such person appearing on such documents is his or her
genuine signature. All capitalized terms used herein and not otherwise defined
shall have the meanings assigned to them in the Agreement.
Dated: ABN AMRO Mortgage Group, Inc.:
------------------------------
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
2
I, __________________, Assistant Secretary of ABN AMRO Mortgage Group,
Inc., hereby certify that __________________ is a duly appointed, qualified and
acting __________________, and that __________________ is a duly appointed,
qualified and acting __________________, that the signature appearing above is
his or her genuine signature, and that pursuant to the resolution attached
hereto as Exhibit A, he or she is authorized to execute and deliver the
Agreement and Commitment Letter.
I have hereunto signed my name.
Dated: ABN AMRO Mortgage Group, Inc.:
------------------------------
By:
------------------------------------
Name:
----------------------------------
Title: Assistant Secretary
3
EXHIBIT 4
[OPINION OF COUNSEL TO SELLER]
Date: __________
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Lending, Inc.
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
I am special counsel to ABN AMRO Mortgage Group, Inc., a Delaware
corporation (the "Seller"), with respect to certain matters in connection with
the sale and servicing by the Seller of the Mortgage Loans pursuant to that
certain Master Mortgage Loan Sale and Servicing Agreement, dated as of October
1, 2006 (the "Agreement"), by and between the Seller and ▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE
LENDING, INC. (the "Purchaser"). Capitalized terms not otherwise defined herein
have the meanings set forth in the Agreement.
In rendering the opinions set forth below, I have examined and relied upon
originals or copies, certified or otherwise identified to my satisfaction, of
the certificate of incorporation and by-laws of the Seller, the Agreement and
such corporate records, agreements or other instruments of the Seller, and such
certificates, records and other documents, agreements and instruments, as I have
deemed necessary and proper as the basis for my opinions. In connection with
such examination, I have assumed the genuineness of all signatures other than
those of the Seller's officers, the authenticity of all documents, agreements
and instruments submitted to me as originals, the conformity to original
documents, agreements and instruments of all documents, agreements and
instruments submitted to me as copies or specimens, the authenticity of the
originals of such documents, agreements and instruments submitted to us as
copies or specimens, the conformity to executed original documents of all
documents submitted to me in draft and the accuracy of the matters set forth in
the documents we reviewed. I have also assumed that all documents, agreements
and instruments have been duly authorized, executed and delivered by all parties
thereto, other than the Seller. As to any facts material to such opinions that I
did not independently establish or verify, I have relied upon statements and
representations of officers and other representatives of the Seller as I have
deemed necessary and proper as the basis for my opinions, including, among other
things, the representations and warranties in the Agreement.
Subject to the foregoing, it is my opinion that:
1. The Seller is a corporation duly organized, validly existing and in
good standing under the laws of the state of Delaware and is authorized to
service and administer the Mortgage Loans in the states where the Mortgaged
Properties are located.
2. The execution, delivery and performance by the Seller and the
transactions contemplated thereby are within its corporate power and have been
duly authorized by all necessary corporate action on the part of the Seller.
3. The Agreement is a legal, valid and binding agreement of the
Seller, enforceable in accordance with its terms, subject to applicable
bankruptcy, reorganization, insolvency, moratorium and other similar laws of
general application affecting the rights of creditors and subject to the rules
of equity (regardless of whether enforcement is sought in a proceeding in equity
or at law).
4. The execution, delivery and performance by the Seller of the
Agreement and the transactions contemplated thereby: (a) do not contravene or
conflict with its certificate of incorporation or by-laws or any law or
regulation to which the Seller is subject; or (b) to the best of my knowledge
(without independent investigation), neither result in the creation or
imposition of any lien on the property or assets of the Seller; nor require any
action by or in respect of, or filing with, any governmental body, agency or
official.
5. There is no action, suit, proceeding or, investigation pending or
threatened against the Seller which, in my judgment, either in any instance or
in the aggregate, will likely result in any material adverse change in the
business, operations, financial conditions, properties or assets of the Seller
or in any material impairment of the right or ability of the Seller to carry on
its business substantially as now conducted or in any material liability on the
part of the Seller or which would draw into question the validity of the
Agreement or of any action taken or to be taken in connection with the
transactions contemplated thereby, or which would be likely to impair materially
the ability of the Seller to perform under the terms of the Agreement.
I am a member of the State Bar of Michigan and my opinions expressed herein
are limited to matters governed by the laws of Michigan and the federal laws of
the United States of America. I have not made any examination of the laws of any
other jurisdiction as to the extent or manner in which such laws may govern or
affect the Agreement or the transactions contemplated thereby. Except as
expressly provided herein, this opinion is being furnished to the addressee
hereof solely for its benefit in connection with the transactions contemplated
in the Agreement, and it is not to be used, circulated, quoted or otherwise
referred to for any purpose without my express written consent. Further, I
assume no obligation to revise or supplement this opinion should the present
laws or regulations be changed by legislative or administrative action, judicial
decision or otherwise.
Sincerely,
ABN AMRO Mortgage Group, Inc.
By:
------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Its: Special Counsel
2
EXHIBIT 5
CUSTODIAL ACCOUNT CERTIFICATION
________________________ __, 200_
To: _____________________________
_____________________________
_____________________________
(the "Depository")
As Seller under the Master Mortgage Loan Sale and Servicing Agreement,
(the "Agreement") dated as of October 1, 2006, we hereby authorize and request
you to establish an account, as a Custodial Account, to be designated as
"[SELLER], as Servicer, in trust for ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Capital, Inc.." All
deposits in the account shall be subject to withdrawal therefrom by order signed
by Seller in accordance with the Agreement. You may refuse any deposit which
would result in violation of the requirement that the account be fully insured
as described below. This letter is submitted to you in duplicate. Please execute
and return one original to us.
[SELLER]
(Seller)
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
Date:
-------------------------------
(CONTINUED ON NEXT PAGE)
The undersigned, as Depository, hereby certifies that the above-described
account has been established as a Custodial Account pursuant to the Agreement
under Account Number ___________ at the office of the Depository indicated
above, and agrees to honor withdrawals on such account as provided above.
----------------------------------------
Depository
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
Date:
-------------------------------
2
EXHIBIT 6
ESCROW ACCOUNT CERTIFICATION
__________ __, 200_
To: _____________________________
_____________________________
_____________________________
(the "Depository")
As Seller under the Master Mortgage Loan Sale and Servicing Agreement,
(the "Agreement") dated as of October 1, 2006, we hereby authorize and request
you to establish an account, as an Escrow Account, to be designated as "[SELLER]
in trust for Purchaser and various Mortgagors, Fixed and Adjustable Rate
Mortgage Loans." All deposits in the account shall be subject to withdrawal
therefrom by order signed by Seller in accordance with the Agreement. You may
refuse any deposit which would result in violation of the requirement that the
account be fully insured as described below. This letter is submitted to you in
duplicate. Please execute and return one original to us.
[SELLER]
(Seller)
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
Date:
-------------------------------
(CONTINUED ON NEXT PAGE)
The undersigned, as Depository, hereby certifies that the above-described
account has been established as an Escrow Account pursuant to the Agreement
under Account Number ___________ at the office of the Depository indicated
above, and agrees to honor withdrawals on such account as provided above.
-------------------------------------
Depository
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
Date:
-------------------------------
2
EXHIBIT 7
ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
(for Whole Loan Transfer)
between
_______________________________________________,
as Assignee,
_______________________________________________
as Assignor
and
ABN AMRO Mortgage Group, Inc.,
as the Seller
Dated _________________
ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
(for Whole Loan Transfer)
This Assignment, Assumption and Recognition Agreement (the "Agreement") is
made and entered into on __________________, by ___________________________,
having an address at ____________________________________________________
("Assignor"), _______________________________________________, having an address
at ________________________________________________________ ("Assignee") and ABN
AMRO Mortgage Group, Inc., having an address at ▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Seller").
In consideration of the mutual promises and agreements contained herein,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:
1. Assignment and Assumption. Except as expressly provided for herein, and
upon payment by Assignee to Assignor of the amounts referenced in that certain
trade confirmation dated as of __________________ (the "Trade Confirmation") and
duly executed by Assignor and Assignee (such amounts, the "Purchase Price"), and
upon payment to Seller of any Transfer Fee, if applicable, required pursuant to
the Sale Agreement defined below, Assignor hereby grants, transfers and assigns
to Assignee (a) all of its right, title and interest in and to each of the
mortgage loans identified in Exhibit A attached hereto, excluding the servicing
rights related thereto ("Mortgage Loans") and (b) with respect to the Mortgage
Loans, all of its right, title and interest as "Purchaser" in that certain
Master Mortgage Loan Sale and Servicing Agreement dated ________________, and
duly executed by the Seller and Assignor, a copy of which is attached hereto as
Exhibit B (the "Sale Agreement"). Notwithstanding anything to the contrary
contained herein, Assignor is not assigning to Assignee any of the servicing
rights related to the Mortgage Loans.
Except as is otherwise expressly provided herein, Assignor makes no
representations, warranties or covenants to Assignee and Assignee acknowledges
that Assignor has no obligations to Assignee under the terms of the Sale
Agreement, or otherwise relating to the transaction contemplated herein,
including but not limited to, any obligation to repurchase any of the Mortgage
Loans or to indemnify Assignee.
2. Payment of Purchase Price. Assignee shall pay the Purchase Price to
Assignor on or prior to the date hereof by wire transfer of immediately
available funds to the account designated below:
ABA -
ACCT -
REF -
3. Recognition of Assignee by the Seller. From and after the date hereof,
and on the condition that Assignor shall have paid any Transfer Fee required
pursuant to the Sale Agreement,
the Seller shall recognize Assignee as the owner of the Mortgage Loans and the
"Purchaser" under the Sale Agreement with respect to such Mortgage Loans.
4. Servicing of the Mortgage Loans. From and after the date hereof, and
on the condition that Assignor shall have paid any Transfer Fee required
pursuant to the Sale Agreement, the Seller shall service the Mortgage Loans for
Assignee in accordance with the Sale Agreement. The address of Assignee set
forth in Section 15 of the Sale Agreement shall be amended to read as follows:
Attn: _______________
The wire transfer instructions for distributions to Assignee on the
remittance dates shall be as follows:
Bank: ____________________________
City: ____________________________
ABA Routing Number: ______________
For Credit to: ___________________
Account No.: _____________________
Attn: ____________________________
5. Status of Sale Agreement. The Seller and Assignor represent and warrant
to Assignee that as of the date hereof (a) the Sale Agreement with respect to
each of the Mortgage Loans is in full force and effect, (b) the Sale Agreement
has not been amended or modified in any respect (except as provided herein), and
(c) there has been no waiver or any agreement to waive any provision, nor has
any notice of termination been given, under the Sale Agreement.
6. No Claims. The Seller represents and warrants to Assignor and Assignee
that it has no offsets, counterclaims or other defenses available to it with
respect to the Sale Agreement. Assignor represents and warrants to the Seller
and Assignee that it has no offsets, counterclaims or other defenses available
to it with respect to the Sale Agreement.
7. Covenants, Representations and Warranties of Assignor. Assignor
represents and warrants to, and covenants with, Assignee that:
a. Assignor is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its formation, and has all requisite
corporate power and authority to acquire, own and sell the Mortgage Loans;
b. Assignor has full corporate power and authority to execute, deliver
and perform under this Agreement, and to consummate the transactions set forth
herein. The execution, delivery and performance of Assignor of this Agreement,
and the consummation by it of the transactions contemplated hereby, have been
duly authorized by all necessary corporate action of Assignor. This Agreement
has been fully executed and delivered by Assignor and constitutes the valid and
legally binding obligation of Assignor enforceable against Assignor in
accordance with its respective terms, except as enforcement is limited by
applicable bankruptcy, insolvency and similar laws affecting the rights of
creditors generally, and by general principles of equity, regardless of whether
enforcement is sought in a proceeding in equity or at law;
2
c. No material consent, approval, order or authorization of, or
declaration, filing or registration with, any governmental entity is required to
be obtained or made by Assignor in connection with the execution, delivery or
performance by Assignor of this Agreement, or the consummation by it of the
transaction contemplated hereby;
d. There is no action, suit, proceeding, investigation or litigation
pending or, to Assignor's knowledge, threatened, which either in any instance or
in the aggregate, if determined adversely to Assignor, would materially and
adversely affect (i) the sale of the Mortgage Loans to Assignee, (ii) the
execution, delivery or enforceability of this Agreement, or (iii) Assignor's
ability to perform its obligations under this Agreement; and
e. Immediately prior to payment of the Purchase Price for the Mortgage
Loans, Assignor is the lawful owner of the Mortgage Loans with the full right to
transfer the Mortgage Loans free from any and all claims and encumbrances
whatsoever.
8. Covenants, Representations and Warranties of Assignee. Assignee
represents and warrants to, and covenants with, Assignor and the Seller that:
a. Except for the provisions pertaining to the payment of the purchase
price thereunder, from and after the date hereof, Assignee agrees to be bound as
"Purchaser" by all of the terms, covenants and conditions of the Sale Agreement
and Assignee assumes for the benefit of Assignor and the Seller all of
Assignor's obligations as "Purchaser" thereunder.
b. Assignee is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its formation, and has all requisite
corporate power and authority to acquire, own and sell the Mortgage Loans;
c. Assignee has full corporate power and authority to execute, deliver
and perform under this Agreement, and to consummate the transactions set forth
herein. The execution, delivery and performance of Assignee of this Agreement,
and the consummation by it of the transactions contemplated hereby, have been
duly authorized by all necessary corporate action of Assignee. This Agreement
has been fully executed and delivered by Assignee and constitutes the valid and
legally binding obligation of Assignee enforceable against Assignee in
accordance with its respective terms, except as enforcement is limited by
applicable bankruptcy, insolvency and similar laws affecting the rights of
creditors generally, and by general principles of equity, regardless of whether
enforcement is sought in a proceeding in equity or at law;
d. No material consent, approval, order or authorization of, or
declaration, filing or registration with, any governmental entity is required to
be obtained or made by Assignee in connection with the execution, delivery or
performance by Assignee of this Agreement, or the consummation by it of the
transaction contemplated hereby; and
e. There is no action, suit, proceeding, investigation or litigation
pending or, to Assignee's knowledge, threatened, which either in any instance or
in the aggregate, if determined adversely to Assignee, would materially and
adversely affect (i) the purchase of the Mortgage Loans from Assignor, (ii) the
execution, delivery or enforceability of this Agreement, or (iii) Assignee's
ability to perform its obligations under this Agreement.
3
9. Bringdown of Corporate Representations and Warranties. Seller Represents
and warrants to Assignee that the corporate representations and warranties set
forth in Section 6.02 only of the Sale Agreement are true and correct and shall
be deemed to be made as of the date hereof.
10. Governing Law. Except to the extent preempted by federal law, this
Agreement shall be governed by, and construed in accordance with, the laws of
the State of New York, without regard to the choice of law rules of New York or
any other jurisdiction.
11. Confidentiality. The Seller, Assignor and Assignee hereby acknowledge
and agree that this Agreement shall be kept confidential and its contents will
not be divulged to any party without the other party's consent except to the
extent that it is appropriate for the Seller, Assignor or Assignee to do so in
working with their respective directors, officers, employees, agents, legal
counsel, auditors, taxing authorities or other governmental agencies.
12. Conflict with Sale Agreement. To the extent there is any conflict
between the terms of the Sale Agreement and this Agreement, the latter shall be
controlling, notwithstanding anything to the contrary contained in the Sale
Agreement.
13. Capitalized Terms. All capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned to such terms in the Sale
Agreement.
14. Counterparts. This Agreement may be executed in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
15. Notices. All demands, notices and communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed, by registered or
certified mail, postage prepaid, return receipt requested, or, if by other
means, when received by the other party at the address as follows:
(a) if to Assignee:
______________________________
______________________________
______________________________
With copy to:
______________________________
______________________________
______________________________
4
(b) if to the Seller:
ABN AMRO Mortgage Group, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Fax: 904/▇▇▇-▇▇▇▇
Phone: 904/▇▇▇-▇▇▇▇
With copy to:
LaSalle Bank Corporation
Legal Department - M 0900-380
▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Fax: 248/▇▇▇-▇▇▇▇
Phone: 248/▇▇▇-▇▇▇▇
(c) if to Assignor:
______________________________
______________________________
______________________________
With copy to:
______________________________
______________________________
______________________________
[SIGNATURE PAGE FOLLOWS]
5
The parties hereto have executed this Agreement on the date first above
written.
------------------------------
Assignor
By
-------------------------------------
Name:
----------------------------------
Title:
---------------------------------
------------------------------,
Assignee
By
-------------------------------------
Name:
----------------------------------
Title:
---------------------------------
ABN AMRO MORTGAGE GROUP, INC.,
the Seller
By
-------------------------------------
Name:
----------------------------------
Title:
---------------------------------
6
EXHIBIT A
MORTGAGE LOANS
(attached)
EXHIBIT B
MASTER MORTGAGE LOAN SALE AND SERVICING AGREEMENT
(attached)
EXHIBIT 8
ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
(for Securitization Transaction)
between
___________________________________,
as Assignee,
____________________________________
as Assignor
and
ABN AMRO Mortgage Group, Inc.,
as the Seller
Dated _________________
ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
(for Securitization Transaction)
This Assignment, Assumption and Recognition Agreement (the "Agreement") is
made and entered into on __________________, by ___________________________,
having an address at ____________________________________________________
("Assignor"), _______________________________________________, having an address
at ________________________________________________________ ("Assignee") and ABN
AMRO Mortgage Group, Inc., having an address at ▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Seller").
WHEREAS, the Assignor has acquired certain mortgage loans set forth on
Exhibit A (the "Mortgage Loans") from the Seller pursuant to that certain Master
Mortgage Loan Sale and Servicing Agreement (the "Sale Agreement"), dated as of
October 1, 2006;
For and in consideration of the mutual promises and agreements contained herein,
and other valuable consideration, the receipt and sufficiency of which hereby
are acknowledged, and of the mutual covenants herein contained, the parties
hereto hereby agree as follows:
1. Defined terms used in this Agreement and not otherwise defined herein
shall have the meaning set forth in the Sale Agreement.
2. Except as expressly provided for herein, and upon payment to Seller of
any Transfer Fee, if applicable, required pursuant to the Sale Agreement, the
Assignor hereby grants, transfers and assigns to Assignee all of the right,
title and interest of Assignor, as purchaser, in, to and under (a) the Mortgage
Loans and (b) the Sale Agreement with respect to the Mortgage Loans.
The Assignor specifically reserves and does not assign to the Assignee
hereunder any and all right, title and interest in, to and under any and all
obligations of the Assignor with respect to any mortgage loans subject to the
Sale Agreement which are not the Mortgage Loans set forth on Exhibit A attached
hereto and are not the subject of this Agreement.
Except as is otherwise expressly provided herein, Assignor makes no
representations, warranties or covenants to Assignee and Assignee acknowledges
that Assignor has no obligations to Assignee under the terms of the Sale
Agreement, or otherwise relating to the transaction contemplated herein,
including but not limited to, any obligation to repurchase any of the Mortgage
Loans or to indemnify Assignee.
3. Recognition of Assignee by the Seller. From and after the date hereof,
and on the condition that Assignor shall have paid any Transfer Fee required
pursuant to the Sale Agreement, the Seller shall recognize Assignee as the owner
of the Mortgage Loans and the "Purchaser" under the Sale Agreement with respect
to such Mortgage Loans.
4. Servicing of the Mortgage Loans. From and after the date hereof, and on
the condition that Assignor shall have paid any Transfer Fee required pursuant
to the Sale Agreement, the Seller shall service the Mortgage Loans for Assignee
in accordance with the Sale Agreement.
The address of Assignee set forth in Section 15 of the Sale Agreement shall be
amended to read as follows:
Attn: _______________
The wire transfer instructions for distributions to Assignee on the
remittance dates shall be as follows:
Bank: __________________
City: __________________
ABA Routing Number: __________________
For Credit to: __________________
Account No.: __________________
Attn: __________________
5. Status of Sale Agreement. The Seller and Assignor represent and warrant
to Assignee that as of the date hereof (a) the Sale Agreement with respect to
each of the Mortgage Loans is in full force and effect, (b) the Sale Agreement
has not been amended or modified in any respect (except as provided herein), and
(c) there has been no waiver or any agreement to waive any provision, nor has
any notice of termination been given, under the Sale Agreement.
6. No Claims. The Seller represents and warrants to Assignor and Assignee
that it has no offsets, counterclaims or other defenses available to it with
respect to the Sale Agreement. Assignor represents and warrants to the Seller
and Assignee that it has no offsets, counterclaims or other defenses available
to it with respect to the Sale Agreement.
7. Covenants, Representations and Warranties of Assignor. Assignor
represents and warrants to, and covenants with, Assignee that:
a. Assignor is a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction of its incorporation, and has
all requisite corporate power and authority to acquire, own and sell the
Mortgage Loans;
b. Assignor has full corporate power and authority to execute, deliver
and perform under this Agreement, and to consummate the transactions set forth
herein. The execution, delivery and performance of Assignor of this Agreement,
and the consummation by it of the transactions contemplated hereby, have been
duly authorized by all necessary corporate action of Assignor. This Agreement
has been fully executed and delivered by Assignor and constitutes the valid and
legally binding obligation of Assignor enforceable against Assignor in
accordance with its respective terms, except as enforcement is limited by
applicable bankruptcy, insolvency and similar laws affecting the rights of
creditors generally, and by general principles of equity, regardless of whether
enforcement is sought in a proceeding in equity or at law;
c. No material consent, approval, order or authorization of, or
declaration, filing or registration with, any governmental entity is required to
be obtained or made by Assignor in connection with the execution, delivery or
performance by Assignor of this Agreement, or the consummation by it of the
transaction contemplated hereby;
2
d. There is no action, suit, proceeding, investigation or litigation
pending or, to Assignor's knowledge, threatened, which either in any instance or
in the aggregate, if determined adversely to Assignor, would materially and
adversely affect (i) the sale of the Mortgage Loans to Assignee, (ii) the
execution, delivery or enforceability of this Agreement, or (iii) Assignor's
ability to perform its obligations under this Agreement; and
e. Immediately prior to payment of the Purchase Price for the Mortgage
Loans, Assignor is the lawful owner of the Mortgage Loans with the full right to
transfer the Mortgage Loans free from any and all claims and encumbrances
whatsoever.
8. Covenants, Representations and Warranties of Assignee. Assignee
represents and warrants to, and covenants with, Assignor and the Seller that:
a. Except for the provisions pertaining to the payment of the purchase
price thereunder, from and after the date hereof, Assignee agrees to be bound as
"Purchaser" by all of the terms, covenants and conditions of the Sale Agreement
and Assignee assumes for the benefit of Assignor and the Seller all of
Assignor's obligations as "Purchaser" thereunder.
b. Assignee is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its formation, and has all requisite
corporate power and authority to acquire, own and sell the Mortgage Loans;
c. Assignee has full corporate power and authority to execute, deliver
and perform under this Agreement, and to consummate the transactions set forth
herein. The execution, delivery and performance of Assignee of this Agreement,
and the consummation by it of the transactions contemplated hereby, have been
duly authorized by all necessary corporate action of Assignee. This Agreement
has been fully executed and delivered by Assignee and constitutes the valid and
legally binding obligation of Assignee enforceable against Assignee in
accordance with its respective terms, except as enforcement is limited by
applicable bankruptcy, insolvency and similar laws affecting the rights of
creditors generally, and by general principles of equity, regardless of whether
enforcement is sought in a proceeding in equity or at law;
c. No material consent, approval, order or authorization of, or
declaration, filing or registration with, any governmental entity is required to
be obtained or made by Assignee in connection with the execution, delivery or
performance by Assignee of this Agreement, or the consummation by it of the
transaction contemplated hereby; and
d. There is no action, suit, proceeding, investigation or litigation
pending or, to Assignee 's knowledge, threatened, which either in any instance
or in the aggregate, if determined adversely to Assignee, would materially and
adversely affect (i) the purchase of the Mortgage Loans from Assignor, (ii) the
execution, delivery or enforceability of this Agreement, or (iii) Assignee
ability to perform its obligations under this Agreement.
9. Bringdown of Corporate Representations and Warranties. Seller Represents
and warrants to Assignee that the corporate representations and warranties set
forth in Section 6.02 only of the Sale Agreement are true and correct and shall
be deemed to be made as of the date hereof.
3
10. Governing Law. Except to the extent preempted by federal law, this
Agreement shall be governed by, and construed in accordance with, the laws of
the State of New York, without regard to the choice of law rules of New York or
any other jurisdiction.
11. Confidentiality. The Seller, Assignor and Assignee hereby acknowledge
and agree that this Agreement shall be kept confidential and its contents will
not be divulged to any party without the other party's consent except to the
extent that it is appropriate for the Seller, Assignor or Assignee to do so in
working with their respective directors, officers, employees, agents, legal
counsel, auditors, taxing authorities or other governmental agencies.
12. Conflict with Sale Agreement. To the extent there is any conflict
between the terms of the Sale Agreement and this Agreement, the latter shall be
controlling, notwithstanding anything to the contrary contained in the Sale
Agreement.
13. Capitalized Terms. All capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned to such terms in the Sale
Agreement.
14. Counterparts. This Agreement may be executed in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
15. Notices. All demands, notices and communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed, by registered or
certified mail, postage prepaid, return receipt requested, or, if by other
means, when received by the other party at the address as follows:
(a) if to Assignee:
_____________________________
_____________________________
_____________________________
With copy to:
_____________________________
_____________________________
_____________________________
(b) if to the Seller:
ABN AMRO Mortgage Group, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Fax: 904/▇▇▇-▇▇▇▇
Phone: 904/▇▇▇-▇▇▇▇
4
With copy to:
LaSalle Bank Corporation
Legal Department - M 0900-380
▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Fax: 248/▇▇▇-▇▇▇▇
Phone: 248/▇▇▇-▇▇▇▇
(c) if to Assignor:
_____________________________
_____________________________
_____________________________
With copy to:
_____________________________
_____________________________
_____________________________
[SIGNATURE PAGE FOLLOWS]
5
The parties hereto have executed this Agreement on the date first above
written.
---------------------------------------,
Assignor
By
-------------------------------------
Name:
----------------------------------
Title:
---------------------------------
---------------------------------------,
Assignee
By
-------------------------------------
Name:
----------------------------------
Title:
---------------------------------
ABN AMRO MORTGAGE GROUP, INC.,
the Seller
By
-------------------------------------
Name:
----------------------------------
Title:
---------------------------------
[ACKNOWLEDGED:
Entity Name: ________________________
By
----------------------------------
Name:
-------------------------------
Title: ]
-----------------------------
6
EXHIBIT A
MORTGAGE LOANS
(attached)
EXHIBIT B
MASTER MORTGAGE LOAN SALE AND SERVICING AGREEMENT
(attached)
EXHIBIT C
FORM OF BACK-UP CERTIFICATION
EXHIBIT 9
INDEMNIFICATION LETTER
________, 2006
[XYZ, Inc.
Address
Re: XYZ Mortgage Pass-Through Trust 200_-XX
Mortgage Pass-Through Certificates, Series 200_-XX
Ladies and Gentlemen:
Reference is hereby made to the [Free Writing Prospectus] [Prospectus
Supplement] dated _______, 200_ (the "PROSPECTUS SUPPLEMENT"), relating to the
public offering of XYZ Mortgage Pass-Through Certificates, Series 200_-XX (the
"CERTIFICATES").
1. In connection with the purchase by XYZ, Inc. ("XYZ") from XYZ
Subsidiary, Inc. ("XYZ SUB") of certain mortgage loans that were originated or
acquired by ABN AMRO Mortgage Group, Inc. ("ABN AMRO") and sold to XYZ Sub
pursuant to a certain Mortgage Loan Purchase and Servicing Agreement, effective
as of ___________, 200_, and in connection with the above-referenced
transaction, ABN AMRO hereby indemnifies and holds harmless XYZ, each director
of XYZ, each officer of XYZ who signed the Registration Statement, each
affiliate of XYZ, and each person, if any, who controls XYZ within the meaning
of Section 15 of the Securities Act of 1933, as amended (the "1933 ACT") or
Section 20 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act") and Underwriter, Inc., (collectively, the "XYZ INDEMNIFIED PARTY"),
against any and all losses, expenses, damages, liabilities, penalties, fines,
forfeitures, legal fees and expenses and related costs, judgments, and any other
costs, fees and expenses to which the XYZ Indemnified Party may become subject,
under the 1933 Act or otherwise, which arise out of or are based upon any untrue
statement of any material fact contained in the ABN AMRO Information (as defined
below) or the omission to state in the ABN AMRO Information a material fact
necessary in order to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or omission
relates to the ABN AMRO Information in the Prospectus Supplement. [ "ABN AMRO
Information" shall mean, (i) the information under the caption "Underwriting
Process--ABN AMRO Mortgage Group, Inc.", excluding the first paragraph thereof
titled "General", a copy of which is attached hereto as Exhibit A, and the
static pool information set forth on ABN AMRO's internet website at
[www._________] [Updated as needed for each deal] (the "ABN AMRO INFORMATION").
2. XYZ [and an affiliate indemnifier of sufficient financial strength
acceptable to ABN AMRO if XYZ is not of sufficient financial strength acceptable
to ABN AMRO] each hereby jointly and severally indemnify and hold harmless ABN
AMRO, each officer and director of ABN AMRO and each person, if any, who
controls ABN AMRO within the meaning of Section 15 of the 1933 Act or Section 20
of the Exchange Act (collectively, the "ABN AMRO INDEMNIFIED PARTY" and together
with the XYZ Indemnified Party, an "INDEMNIFIED PARTY")
against any and all losses, expenses, damages, liabilities, penalties, fines,
forfeitures, legal fees and expenses and related costs, judgments, and any other
costs, fees and expenses to which the ABN AMRO Indemnified Party may become
subject, under the 1933 Act or otherwise, which arise out of or are based upon
any untrue statement of any material fact contained in the Prospectus Supplement
or the omission to state in the Prospectus Supplement a material fact necessary
in order to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or omission relates
to information in the Prospectus Supplement other than the ABN AMRO Information
(the "XYZ INFORMATION");
3. Promptly after the Indemnified Party receives notice of the commencement
of any such action, the Indemnified Party will, if a claim in respect thereof is
to be made pursuant to this agreement, promptly notify the indemnifying party in
writing of the commencement thereof. In case any such action is brought against
the Indemnified Party, and it notifies the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to appoint
counsel of the indemnifying party's choice at the indemnifying party's expense
to represent the Indemnified Party in any action for which indemnification is
sought (in which case the indemnifying party shall not thereafter be responsible
for the fees and expenses of any separate counsel retained by the Indemnified
Party except as set forth below); provided, however, that such counsel shall be
reasonably satisfactory to the Indemnified Party. Notwithstanding the
indemnifying party's election to appoint counsel to represent the Indemnified
Party in an action, the Indemnified Party shall have the right to employ
separate counsel (including local counsel), and the indemnifying party shall
bear the reasonable fees, costs and expenses of such separate counsel if (i) the
use of counsel chosen by the indemnifying party to represent the Indemnified
Party would present such counsel with a conflict of interest, (ii) the actual or
potential defendants in, or targets of, any such action include both the
Indemnified Party and the indemnifying party, and the Indemnified Party shall
have reasonably concluded that there may be legal defenses available to it that
are different from or additional to those available to the indemnifying party,
(iii) the indemnifying party shall not have employed counsel reasonably
satisfactory to the Indemnified Party to represent the Indemnified Party within
a reasonable time after notice of the institution of such action or (iv) the
indemnifying party shall authorize the Indemnified Party to employ separate
counsel at the expense of the indemnifying party. The indemnifying party will
not, without the prior written consent of the Indemnified Party, settle or
compromise or consent to the entry of any judgment with respect to any pending
or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
Indemnified Party is an actual or potential party to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each Indemnified Party from all liability arising out of such claim, action,
suit or proceeding. In addition, for so long as the indemnifying party is
covering all costs and expenses of the Indemnified Party as provided herein, no
Indemnified Party will settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder without the consent of the indemnifying party, which consent shall not
be unreasonably withheld.
4. If the indemnification provided for in this agreement is decreed
unenforceable, in whole or in part, for public policy reasons by a court of
competent jurisdiction, then the indemnifying party shall contribute to the
amount paid or payable by such Indemnified Party as a result of the losses,
damages or liabilities referred to above in such proportion as is appropriate to
2
reflect the relative fault of the indemnifying party in connection with the
statements or omissions which resulted in such losses, damages or liabilities as
well as any other relevant equitable considerations. The relative fault shall be
determined by reference to, among other things, whether the untrue statement of
a material fact or the omission to state a material fact relates to the ABN AMRO
Information or the XYZ Information and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The amount paid by an Indemnified Party as a result of
the losses, damages or liabilities referred to in the first sentence of this
paragraph shall be deemed to include any legal or other expenses reasonably
incurred by such Indemnified Party in connection with investigating or defending
any action which is the subject of this paragraph.
5. Notwithstanding anything herein to the contrary, however, the
indemnifying party, without the prior written consent of the Indemnified Party,
shall not agree to any settlement if the matter involves any possible criminal
action or proceeding, or contains a stipulation to, or admission or
acknowledgment of any wrongdoing (in tort or otherwise) on the part of the
Indemnified Party, and the settlement of any such matter without the prior
written consent of the Indemnified Party shall be void and of no effect.
6. GOVERNING LAW. EXCEPT TO THE EXTENT PREEMPTED BY FEDERAL LAW, THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, WITHOUT REGARD TO THE CHOICE OF LAW RULES OF NEW YORK OR ANY
OTHER JURISDICTION.
Very truly yours,
ABN AMRO MORTGAGE GROUP, INC.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
AGREED TO AND ACCEPTED:
XYZ, INC.
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
[ADDITIONAL SUBSTANTIAL INDEMNIFIER]
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
3
EXHIBIT A
ABN AMRO INFORMATION
[To be provided by ABN AMRO and updated for each deal.]
EXHIBIT 10
FORM OF ANNUAL CERTIFICATION
Re: The [_____] agreement dated as of [___], 200[__] (the "Agreement"), among
[IDENTIFY PARTIES]
I, ________________________________, the _______________________ of [NAME OF
SELLER], hereby certify to ________________________________________________
("Purchaser's Agent"), with the knowledge and intent that it will rely upon this
certification, that:
(1) I have reviewed the servicer compliance statement of the Seller provided in
accordance with Item 1123 of Regulation AB (the "Compliance Statement"), the
report on assessment of Seller's compliance with the servicing criteria set
forth in Item 1122(d) of Regulation AB (the "Servicing Criteria"), provided in
accordance with Rules 13a-18 and 15d-18 under Securities Exchange Act of 1934,
as amended (the "Exchange Act") and Item 1122(a) of Regulation AB (the
"Servicing Assessment"), the registered public accounting firm's attestation
report provided in accordance with Rules 13a-18 and 15d-18 under the Exchange
Act and Section 1122(b) of Regulation AB (the "Attestation Report"), and all
servicing reports and officer certificates related to the servicing of the
Mortgage Loans during 200__, that were delivered pursuant to the Agreement
(collectively, the "Seller Servicing Information");
(2) Based on my knowledge, the Seller Servicing Information, taken as a whole,
do not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made therein, in the light of the
circumstances under which such statements were made, not misleading with respect
to the period of time covered by the Seller Servicing Information;
(3) Based on my knowledge, all of the Seller Servicing Information required to
be provided to Purchaser's Agent by the Seller under the Agreement has been
provided to Purchaser's Agent;
(4) I am responsible for reviewing the activities performed by the Seller as
servicer under the Agreement, and based on my knowledge and the compliance
review conducted in preparing the Compliance Statement, and except as disclosed
in the Compliance Statement, the Servicing Assessment or the Attestation Report,
Seller has fulfilled its obligations under the Agreement in all material
respects; and
(5) The Compliance Statement required to be delivered by Seller pursuant to the
Agreement, and the Servicing Assessment and Attestation Report required to be
provided by Seller [and by any Subservicer or Subcontractor] pursuant to the
Agreement, have been provided to Purchaser's Agent, and they disclose all
material instances of noncompliance with the Servicing Criteria and the
Agreement.
ABN AMRO MORTGAGE GROUP, INC.
By:
---------------------------------
Name:
-------------------------------
Title: Date:
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2
EXHIBIT 11
SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The assessment of compliance to be delivered by [the Seller] [Name of
Subservicer] shall address, at a minimum, the criteria identified as below as
"Applicable Servicing Criteria":
APPLICABLE
SERVICING
SERVICING CRITERIA CRITERIA
-------------------------------------------------------------------------------- ----------
REFERENCE CRITERIA
--------- --------
GENERAL SERVICING CONSIDERATIONS
1122(d)(1)(i) Policies and procedures are instituted to monitor any X
performance or other triggers and events of default in
accordance with the transaction agreements.
1122(d)(1)(ii) If any material servicing activities are outsourced to third X
parties, policies and procedures are instituted to monitor
the third party's performance and compliance with such
servicing activities.
1122(d)(1)(iii) Any requirements in the transaction agreements to maintain a
back-up servicer for the mortgage loans are maintained.
1122(d)(1)(iv) A fidelity bond and errors and omissions policy is in effect X
on the party participating in the servicing function
throughout the reporting period in the amount of coverage
required by and otherwise in accordance with the terms of the
transaction agreements.
CASH COLLECTION AND ADMINISTRATION
1122(d)(2)(i) Payments on mortgage loans are deposited into the appropriate X
custodial bank accounts and related bank clearing accounts no
more than two business days following receipt, or such other
number of days specified in the transaction agreements.
1122(d)(2)(ii) Disbursements made via wire transfer on behalf of an obligor X
or to an investor are made only by authorized personnel.
1122(d)(2)(iii) Advances of funds or guarantees regarding collections, cash X
flows or distributions, and any interest or other fees
charged for such advances, are made, reviewed and approved as
specified in the transaction agreements.
1122(d)(2)(iv) The related accounts for the transaction, such as cash X
reserve accounts or accounts established as a form of
overcollateralization, are separately maintained (e.g., with
respect to commingling of cash) as set forth in the
transaction agreements.
1122(d)(2)(v) Each custodial account is maintained at a federally insured X
depository institution as set forth in the transaction
agreements. For purposes of this criterion, "federally
insured depository institution" with respect to a foreign
financial institution means a foreign financial institution
that meets the requirements of Rule 13k-1(b)(1) of the
Securities Exchange Act.
1122(d)(2)(vi) Unissued checks are safeguarded so as to prevent unauthorized X
access.
1122(d)(2)(vii) Reconciliations are prepared on a monthly basis for all X
asset-backed securities related bank accounts, including
custodial accounts and related bank clearing accounts. These
reconciliations are (A) mathematically accurate; (B) prepared
within 30 calendar days after the bank statement cutoff date,
or such other number of days specified in the transaction
agreements; (C) reviewed and approved by someone other than
the person
APPLICABLE
SERVICING
SERVICING CRITERIA CRITERIA
-------------------------------------------------------------------------------- ----------
REFERENCE CRITERIA
--------- --------
who prepared the reconciliation; and (D) contain explanations
for reconciling items. These reconciling items are resolved
within 90 calendar days of their original identification, or
such other number of days specified in the transaction
agreements.
INVESTOR REMITTANCES AND REPORTING
1122(d)(3)(i) Reports to investors, including those to be filed with the X
Commission, are maintained in accordance with the transaction
agreements and applicable Commission requirements.
Specifically, such reports (A) are prepared in accordance
with timeframes and other terms set forth in the transaction
agreements; (B) provide information calculated in accordance
with the terms specified in the transaction agreements; (C)
are filed with the Commission as required by its rules and
regulations; and (D) agree with investors' or the trustee's
records as to the total unpaid principal balance and number
of mortgage loans serviced by the Servicer.
1122(d)(3)(ii) Amounts due to investors are allocated and remitted in [X]
accordance with timeframes, distribution priority and other
terms set forth in the transaction agreements.
1122(d)(3)(iii) Disbursements made to an investor are posted within two [X]
business days to the Servicer's investor records, or such
other number of days specified in the transaction agreements.
1122(d)(3)(iv) Amounts remitted to investors per the investor reports agree [X]
with cancelled checks, or other form of payment, or custodial
bank statements.
POOL ASSET ADMINISTRATION
1122(d)(4)(i) Collateral or security on mortgage loans is maintained as
required by the transaction agreements or related mortgage
loan documents.
1122(d)(4)(ii) Mortgage loan and related documents are safeguarded as
required by the transaction agreements.
1122(d)(4)(iii) Any additions, removals or substitutions to the asset pool
are made, reviewed and approved in accordance with any
conditions or requirements in the transaction agreements.
1122(d)(4)(iv) Payments on mortgage loans, including any payoffs, made in X
accordance with the related mortgage loan documents are
posted to the Servicer's obligor records maintained no more
than two business days after receipt, or such other number of
days specified in the transaction agreements, and allocated
to principal, interest or other items (e.g., escrow) in
accordance with the related mortgage loan documents.
1122(d)(4)(v) The Servicer's records regarding the mortgage loans agree X
with the Servicer's records with respect to an obligor's
unpaid principal balance.
1122(d)(4)(vi) Changes with respect to the terms or status of an obligor's X
mortgage loans (e.g., loan modifications or re-agings) are
made, reviewed and approved by authorized personnel in
accordance with the transaction agreements and related pool
asset documents.
1122(d)(4)(vii) Loss mitigation or recovery actions (e.g., forbearance plans, X
modifications and deeds in lieu of foreclosure, foreclosures
and repossessions, as applicable) are initiated, conducted
and concluded in accordance with the timeframes or other
requirements established by the transaction agreements.
1122(d)(4)(viii) Records documenting collection efforts are maintained during X
the period a mortgage loan is delinquent in accordance with
the transaction agreements. Such records are
2
APPLICABLE
SERVICING
SERVICING CRITERIA CRITERIA
-------------------------------------------------------------------------------- ----------
REFERENCE CRITERIA
--------- --------
maintained on at least a monthly basis, or such other period
specified in the transaction agreements, and describe the
entity's activities in monitoring delinquent mortgage loans
including, for example, phone calls, letters and payment
rescheduling plans in cases where delinquency is deemed
temporary (e.g., illness or unemployment).
1122(d)(4)(ix) Adjustments to interest rates or rates of return for mortgage X
loans with variable rates are computed based on the related
mortgage loan documents.
1122(d)(4)(x) Regarding any funds held in trust for an obligor (such as X
escrow accounts): (A) such funds are analyzed, in accordance
with the obligor's mortgage loan documents, on at least an
annual basis, or such other period specified in the
transaction agreements; (B) interest on such funds is paid,
or credited, to obligors in accordance with applicable
mortgage loan documents and state laws; and (C) such funds
are returned to the obligor within 30 calendar days of full
repayment of the related mortgage loans, or such other number
of days specified in the transaction agreements.
1122(d)(4)(xi) Payments made on behalf of an obligor (such as tax or X
insurance payments) are made on or before the related penalty
or expiration dates, as indicated on the appropriate bills or
notices for such payments, provided that such support has
been received by the servicer at least 30 calendar days prior
to these dates, or such other number of days specified in the
transaction agreements.
1122(d)(4)(xii) Any late payment penalties in connection with any payment to X
be made on behalf of an obligor are paid from the servicer's
funds and not charged to the obligor, unless the late payment
was due to the obligor's error or omission.
1122(d)(4)(xiii) Disbursements made on behalf of an obligor are posted within X
two business days to the obligor's records maintained by the
servicer, or such other number of days specified in the
transaction agreements.
1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible accounts are X
recognized and recorded in accordance with the transaction
agreements.
1122(d)(4)(xv) Any external enhancement or other support, identified in Item No
1114(a)(1) through (3) or Item 1115 of Regulation AB, is
maintained as set forth in the transaction agreements.
3
EXHIBIT 12
ASSIGNMENT AND CONVEYANCE
On this ______ day of ____, 200_, ABN AMRO MORTGAGE GROUP, INC. (the
"Seller") as the Seller under that certain Master Mortgage Loan Sale and
Servicing Agreement, dated as of October 1, 2006 (the "Agreement") does hereby
sell, transfer, assign, set over and convey to ▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE LENDING,
INC. (the "Purchaser") as the Purchaser under the Agreement, without recourse,
but subject to the terms of the Agreement, all rights, title and interest of the
Seller in and to the Mortgage Loans listed on the Mortgage Loan Schedule
attached hereto as Attachment 1, together with the related Mortgage Files and
all rights and obligations arising under the documents contained therein;
provided, that the sale of the Mortgage Loans by the Seller is on a
servicing-retained basis. Pursuant to Section 5.03 of the Agreement, the Seller
has delivered to the Purchaser or its designee the Mortgage Loan Documents for
each Mortgage Loan to be purchased.
Capitalized terms used herein and not otherwise defined shall have the
meanings set forth in the Agreement.
ABN AMRO MORTGAGE GROUP, INC.
Seller
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Date:
----------------------------------
ATTACHMENT 1
MORTGAGE LOAN SCHEDULE
2