Exhibit 99.9(b)
EXECUTION COPY
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇ MORTGAGE CAPITAL INC.
Purchaser
and
EVERBANK
Seller
and
Interim Servicer
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AMENDED AND RESTATED INTERIM SERVICING AGREEMENT
Dated as of
November 7, 2005
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Conventional Adjustable/Fixed Rate Mortgage Loans
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS................................................................................1
ARTICLE II
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS.............................................6
Section 2.01 Interim Servicer Act as Servicer..........................................................6
Section 2.02 Liquidation of Mortgage Loans.............................................................8
Section 2.03 Collection of Mortgage Loan Payments......................................................9
Section 2.04 Establishment of and Deposits to Custodial Account........................................9
Section 2.05 Permitted Withdrawals From Custodial Account.............................................11
Section 2.06 Establishment of and Deposits to Escrow Account..........................................12
Section 2.07 Permitted Withdrawals From Escrow Account................................................12
Section 2.08 Payment of Taxes, Insurance and Other Charges............................................13
Section 2.09 Protection of Accounts...................................................................14
Section 2.10 Maintenance of Hazard Insurance..........................................................14
Section 2.11 Maintenance of Mortgage Impairment Insurance.............................................16
Section 2.12 Maintenance of Fidelity Bond and Errors and Omissions Insurance..........................16
Section 2.13 Inspections..............................................................................17
Section 2.14 Restoration of Mortgaged Property........................................................17
Section 2.15 Maintenance of PMI Policy; Claims........................................................18
Section 2.16 Title, Management and Disposition of REO Property........................................18
Section 2.17 Real Estate Owned Reports................................................................20
Section 2.18 Liquidation Reports......................................................................20
Section 2.19 Reports of Foreclosures and Abandonments of Mortgaged Property...........................21
Section 2.20 Notification of Adjustments..............................................................21
Section 2.21 Transfer of Servicing....................................................................21
Section 2.22 Fair Credit Reporting Act................................................................24
ARTICLE III
PAYMENTS TO PURCHASER.....................................................................24
Section 3.01 Remittances..............................................................................24
Section 3.02 Statements to Purchaser..................................................................25
Section 3.03 Advances by Interim Servicer.............................................................25
ARTICLE IV
GENERAL SERVICING PROCEDURES..............................................................25
Section 4.01 Transfers of Mortgaged Property..........................................................25
Section 4.02 Satisfaction of Mortgages and Release of Mortgage Files..................................26
Section 4.03 Servicing Compensation...................................................................26
Section 4.04 Annual Statement as to Compliance........................................................27
Section 4.05 Annual Independent Public Accountants' Servicing Report..................................27
Section 4.06 Right to Examine Interim Servicer Records................................................27
Section 4.07 Books and Records........................................................................28
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Section 4.08 Delivery of Documents....................................................................28
Section 4.09 Compliance with ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act of 1999...........................................28
ARTICLE V
REPRESENTATIONS AND WARRANTIES; REMEDIES AND BREACH.......................................29
Section 5.01 Interim Servicer Representations and Warranties..........................................29
ARTICLE VI
AGENCY TRANSFER; SECURITIZATION TRANSFER..................................................31
Section 6.01 Removal of Mortgage Loans from Inclusion Under this Agreement Upon an Agency
Transfer, Whole-Loan Transfer or a Securitization Transfer on One or More
Reconstitution Dates.............................................................31
ARTICLE VII
INTERIM SERVICER TO COOPERATE.............................................................35
Section 7.01 Provision of Information.................................................................35
Section 7.02 Financial Statements; Servicing Facility.................................................35
ARTICLE VIII
THE INTERIM SERVICER......................................................................36
Section 8.01 Indemnification; Third Party Claims......................................................36
Section 8.02 Merger or Consolidation of the Interim Servicer..........................................37
Section 8.03 Limitation on Liability of Interim Servicer and Others...................................37
Section 8.04 Limitation on Resignation and Assignment by Interim Servicer.............................38
ARTICLE IX
DEFAULT...................................................................................38
Section 9.01 Events of Default........................................................................38
Section 9.02 Waiver of Defaults.......................................................................40
ARTICLE X
TERMINATION...............................................................................40
Section 10.01 Termination.............................................................................40
Section 10.02 Termination Without Cause...............................................................41
Section 10.03 Agency Suspension.......................................................................41
ARTICLE XI
MISCELLANEOUS PROVISIONS..................................................................41
Section 11.01 Successor to Interim Servicer...........................................................41
Section 11.02 Amendment...............................................................................42
Section 11.03 Governing Law; Jurisdiction; Consent to Service of Process..............................42
Section 11.04 Duration of Agreement...................................................................43
Section 11.05 Notices.................................................................................43
Section 11.06 Severability of Provisions..............................................................43
Section 11.07 Relationship of Parties.................................................................44
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Section 11.08 Execution; Successors and Assigns.......................................................44
Section 11.09 Recordation of Assignments of Mortgage..................................................44
Section 11.10 Assignment by Purchaser.................................................................44
Section 11.11 No Personal Solicitation................................................................44
Section 11.12 Waiver of Trial by Jury.................................................................45
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EXHIBITS
EXHIBIT A MORTGAGE LOAN SCHEDULE
EXHIBIT B [RESERVED]
EXHIBIT C [RESERVED]
EXHIBIT D-1 FORM OF CUSTODIAL ACCOUNT
CERTIFICATION
EXHIBIT D-2 FORM OF CUSTODIAL ACCOUNT
LETTER AGREEMENT
EXHIBIT E-1 FORM OF ESCROW ACCOUNT CERTIFICATION
EXHIBIT E-2 FORM OF ESCROW ACCOUNT
LETTER AGREEMENT
EXHIBIT F [RESERVED]
EXHIBIT G PROCESS GUIDELINES
EXHIBIT H UNDERWRITING GUIDELINES
EXHIBIT I INTERIM SERVICER'S OFFICER'S CERTIFICATE
EXHIBIT J [RESERVED]
EXHIBIT K [RESERVED]
EXHIBIT L ASSIGNMENT AND CONVEYANCE
EXHIBIT M ANNUAL CERTIFICATION
This AMENDED AND RESTATED INTERIM SERVICING AGREEMENT for various
residential mortgage loans (collectively, the "Mortgage Loans"), dated as of
November 7, 2005, between ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc., a New York
corporation and its successors and assigns as purchaser (the "Purchaser"), and
EverBank, a federal savings association, as servicer (the "Seller" or the
"Interim Servicer").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Third Amended and Restated
Mortgage Loan Purchase and Warranties Agreement, dated as of November 7, 2005,
between Purchaser and Seller (the "Purchase Agreement"), and in reliance upon
the representations, warranties and covenants of the Interim Servicer
contained herein and of the Seller contained in the Purchase Agreement, the
Purchaser has agreed to purchase from the Seller, and the Seller has agreed to
sell to the Purchaser, on a servicing-released basis, certain residential,
first lien mortgage loans;
WHEREAS, the Purchaser desires to have the Interim Servicer
service each Mortgage Loan Package on an "actual/actual" basis during the
period between the related Closing Date and the related Transfer Date (each,
an "Interim Period"), the Interim Servicer has agreed to service such Mortgage
Loans for the Purchaser from and after the purchase by the Purchaser thereof;
and
WHEREAS, the Interim Servicer and the Purchaser desire to
prescribe the terms and conditions which will govern the management,
servicing, and control of the Mortgage Loans purchased by the Purchaser
pursuant to the Purchase Agreement;
NOW, THEREFORE, in consideration of the mutual agreements
hereinafter set forth, and for other good and valuable consideration, the
receipt and adequacy of which is hereby acknowledged, the Purchaser and the
Interim Servicer agree as follows:
ARTICLE I
DEFINITIONS
Terms used but not defined herein shall have the meanings set
forth in the Purchase Agreement, and such meanings are hereby incorporated by
reference and deemed a part hereof. Whenever used herein, the following words
and phrases, unless the context otherwise requires, shall have the following
meanings:
Accepted Servicing Practices: With respect to any Mortgage Loan,
those mortgage servicing practices of prudent mortgage lending institutions
which service mortgage loans of the same type as such Mortgage Loan in the
jurisdiction where the related Mortgaged Property is located.
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Adjustment Date: With respect to any Adjustable Rate Mortgage
Loan, the date set forth in the related Mortgage Note on which the Mortgage
Interest Rate on the Mortgage Loan is adjusted in accordance with the terms of
the Mortgagee Note.
Agency Transfer: A sale or transfer of some or all of the Mortgage
Loan to (i) ▇▇▇▇▇▇ Mae under is Cash Purchase Program or MBS Division Special
Servicing Option or (ii) ▇▇▇▇▇▇▇ Mac, ▇▇▇▇▇▇ ▇▇▇ or any other governmental
entity.
Agreement: This Amended and Restated Interim Servicing Agreement
and all amendments hereof and supplements hereto.
Ancillary Income: All fees derived from the Mortgage Loans, other
than Servicing Fees and prepayment fees, including but not limited to, late
charges, fees received with respect to checks or bank drafts returned by the
related bank for non-sufficient funds, assumption fees, optional insurance
administrative fees and all other incidental fees and charges.
Annual Certification: The certification delivered by the Interim
Servicer in a form substantially similar to that attached as Exhibit M to this
Agreement.
BIF: The Bank Insurance Fund, or any successor thereto.
Business Day: Any day other than (i) a Saturday or Sunday, or (ii)
a day on which federally chartered stock savings banks in (a) the State of
Florida or (b) the State of New York are authorized or obligated by law or
executive order to be closed.
Cut-off Date: The date or dates designated as such on the related
Mortgage Loan Schedule with respect to the related Mortgage Loan Package.
Determination Date: The 15th day (or if such 15th day is not a
Business Day, the Business Day immediately preceding such 15th day) of the
month of the related Remittance Date.
Due Date: The day of the month on which the Monthly Payment is due
on a Mortgage Loan, exclusive of any days of grace. With respect to the
Mortgage Loans for which payment from the Mortgagor is due on a day other than
the first day of the month, such Mortgage Loans will be treated as if the
Monthly Payment is due on the first day of the month of such Due Date.
Due Period: With respect to each Remittance Date, the period
commencing on the second day of the month preceding the month of the
Remittance Date and ending on the first day of the month of the Remittance
Date.
Eligible Investments: Any one or more of the obligations and
securities listed below which investment provides for a date of maturity not
later than the Determination Date in each month:
(i) direct obligations of, and obligations fully guaranteed
by, the United States of America, or any agency or instrumentality of
the United States of America the
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obligations of which are backed by the full faith and credit of the
United States of America; and
(ii) federal funds, demand and time deposits in,
certificates of deposits of, or bankers' 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 and
subject to supervision and examination by federal and/or state banking
authorities, so long as at the time of such investment or contractual
commitment providing for such investment the commercial paper or other
short-term debt obligations of such depository institution or trust
company (or, in the case of a depository institution or trust company
which is the principal subsidiary of a holding company, the commercial
paper or other short-term debt obligations of such holding company) are
rated "P-1" by ▇▇▇▇▇'▇) and the long-term debt obligations of such
depository institution or trust company (or, in the case of a depository
institution or trust company which is the principal subsidiary of a
holding company, the long-term debt obligations of such holding company)
are rated at least "Aa" by ▇▇▇▇▇'▇;
provided, however, that no such instrument shall be an Eligible Investment if
such instrument evidences either (i) a right to receive only interest payments
with respect to the obligations underlying such instrument, or (ii) both
principal and interest payments derived from obligations underlying such
instrument and the principal and interest payments with respect to such
instrument provide a yield to maturity of greater than 120% of the yield to
maturity at par of such underlying obligations.
Errors and Omissions Insurance Policy: An errors and omissions
insurance policy to be maintained by the Interim Servicer pursuant to Section
2.12.
Escrow Account: The separate account or accounts created and
maintained pursuant to Section 2.06.
Event of Default: Any one of the conditions or circumstances
enumerated in Section 9.01.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
Fidelity Bond: A fidelity bond to be maintained by the Interim
Servicer pursuant to Section 2.12.
First Remittance Date: With respect to each Closing Date, the
Remittance Date occurring in the calendar month immediately following the
month in which such Closing Date occurs.
GNMA: Government National Mortgage Association, and any successors
thereto.
Mortgage Interest Rate: The annual rate of interest borne on a
Mortgage Note in accordance with the provisions of the Mortgage Note.
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Mortgage Loan Package: The applicable pool of Mortgage Loans sold
to the Purchaser by the Interim Servicer on the relevant Closing Date.
PMI: PMI Mortgage Insurance Co., or any successor thereto.
PMI Policy: A policy of primary mortgage guaranty insurance issued
by a Qualified Insurer, as required by this Agreement with respect to certain
Mortgage Loans (or any replacement policy obtained by the Interim Servicer
pursuant to Section 2.15).
Prepayment Interest Shortfall Amount: With respect to any Mortgage
Loan that was subject to a Principal Prepayment in full or in part during any
Due Period, which Principal Prepayment was applied to such Mortgage Loan prior
to such Mortgage Loan's Due Date in such Due Period, the amount of interest
(net the related Servicing Fee) that would have accrued on the amount of such
Principal Prepayment during the period commencing on the date as of which such
Principal Prepayment was applied to such Mortgage Loan and ending on the day
immediately preceding such Due Date, inclusive.
Prepayment Penalty: With respect to each Mortgage Loan, the amount
of any premium or penalty required to be paid by the Mortgagor if the
Mortgagor prepays such Mortgage Loan as provided in the related Mortgage note
or Mortgage.
Prime Rate: The prime rate announced to be in effect from time to
time, as published as the average rate in the "Money Rates" section of The
Wall Street Journal.
Principal Prepayment: Any payment or other recovery of principal
on a Mortgage Loan which is received in advance of its scheduled Due Date
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.
Principal Prepayment Period: The month preceding the month in
which the related Remittance Date occurs.
Purchase Price: The price paid on the related Closing Date, by the
Purchaser to the Seller pursuant to the related Purchase Price and Terms
Agreement in exchange for the Mortgage Loans purchased on such Closing Date.
Qualified Depository: A depository the accounts of which are
insured by the FDIC through the BIF or the SAIF and the debt obligations of
which are rated AA or better by S&P and "Aa2" or better by ▇▇▇▇▇'▇.
Qualified Insurer: A mortgage guaranty insurance company duly
authorized and licensed where required by law to transact mortgage guaranty
insurance business and approved as an insurer by ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac.
Reconstitution Agreements: The agreement or agreements entered
into by the Purchaser, the Interim Servicer, ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac or
certain third parties on the Reconstitution Date(s) with respect to any or all
of the Mortgage Loans, in connection with a Securitization Transfer,
Whole-Loan Transfer or an Agency Transfer as set forth in Section 6.01,
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including, but not limited to, (i) a ▇▇▇▇▇▇ Mae Mortgage Selling and Servicing
Contract, a Pool Purchase Contract, and any and all servicing agreements and
tri-party agreements reasonably required by ▇▇▇▇▇▇ ▇▇▇ with respect to a
▇▇▇▇▇▇ Mae Transfer, (ii) a Purchase Contract and all purchase documents
associated therewith as set forth in the ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇' & Interim
Servicers' Guide, and any and all servicing agreements and tri-party
agreements reasonably required by ▇▇▇▇▇▇▇ Mac with respect to a ▇▇▇▇▇▇▇ Mac
Transfer, and (iii) a Pooling and Servicing Agreement and/or a
subservicing/master servicing agreement and related custodial/trust agreement,
assignment and conveyance and related documents with respect to a
Securitization Transfer.
Reconstitution Date: The date or dates on which any or all of the
Mortgage Loans serviced under this Agreement shall be removed from this
Agreement and reconstituted as part of an Agency Transfer, Whole Loan Transfer
or a Securitization Transfer pursuant to Section 6.01 hereof.
Remittance Date: The 18th day (or if such 18th day is not a
Business Day, the first Business Day immediately preceding such day) of any
month, beginning with the First Remittance Date.
REO Disposition: The final sale by the Interim Servicer of any REO
Property.
REO Disposition Proceeds: All amounts received with respect to an
REO Disposition pursuant to Section 2.16.
REO Property: A Mortgaged Property acquired by the Interim
Servicer on behalf of the Purchasers through foreclosure or by deed in lieu of
foreclosure, as described in Section 2.16.
SAIF: The Savings Association Insurance Fund, or any successor
thereto.
Seller: EverBank, a federally chartered stock savings bank, or its
successor in interest or assigns, or any successor to the Seller under the
Purchase Agreement appointed as therein provided.
Servicing Advances: All customary, reasonable and necessary "out
of pocket" costs and expenses (including reasonable attorneys' fees and
disbursements) incurred in the performance by the Interim Servicer 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 any REO Property and (d) compliance with the
obligations under Section 2.08.
Servicing Fee: With respect to each Mortgage Loan subject to the
Amended and Restated Interim Servicing Agreement, a fee payable monthly equal
to $5.00 (or any other amount the parties agree to from time to time in
writing). Such fee shall be payable monthly and shall be pro-rated for any
portion of a month during which the Mortgage Loan is serviced by the Interim
Servicer. The obligation of the Purchaser to pay the Interim Servicing Fee is
limited to, and the Interim Servicing Fee is payable solely from, the interest
portion (including recoveries with respect to interest from Liquidation
Proceeds, to the extent permitted by this Agreement) of
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such Monthly Payment collected by the Interim Servicer, or as otherwise
provided under this Agreement.
Servicing Guide: The ▇▇▇▇▇▇ Mae Servicing Guide or the ▇▇▇▇▇▇▇ Mac
Servicing Guide, as in existence on the date of the related sale or transfer
of Mortgage Loans to ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, as applicable, as each may be
amended or supplemented in writing from time to time.
Servicing Officer: Any officer of the Interim Servicer involved in
or responsible for, the administration and servicing of the Mortgage Loans
whose name appears on a list of servicing officers furnished by the Interim
Servicer to the Purchaser upon request, as such list may from time to time be
amended.
Transfer Date: The date on which the Interim Servicer is
terminated as servicer of a Mortgage Loan pursuant to Section 2.21, Article 9
or Article 10, and the Purchaser, or its designee, shall receive the transfer
of servicing responsibilities and begin to perform the servicing of such
Mortgage Loans and the Interim Servicer shall cease all servicing
responsibilities.
VA: The United States Department of Veterans Administration, and
its successors.
ARTICLE II
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 2.01 Interim Servicer Act as Servicer.
From and after the Closing Date, to and including the related
Transfer Date, the Interim Servicer, as an independent contractor, shall
service and administer the Mortgage Loans and shall have full power and
authority, acting alone, to do any and all things in connection with such
servicing and administration which the Interim Servicer may deem necessary or
desirable, consistent with the terms of this Agreement and with Accepted
Servicing Practices. Except as set forth in this Agreement, the Interim
Servicer shall service the Mortgage Loans on an "actual/actual" basis and
otherwise in strict compliance with the servicing provisions related to the
▇▇▇▇▇▇ ▇▇▇ MBS Program (Special Servicing Option) of the ▇▇▇▇▇▇ Mae Guides
(except as otherwise set forth herein); provided, however, that in the event
that the Interim Servicer continues to service a Mortgage Loan after the time
when such Mortgage Loan is sold or transferred pursuant to a Securitization
Transfer, the Interim Servicer shall, at the Purchaser's option, service the
Mortgage Loans on a "scheduled/scheduled" basis. In the event of any conflict,
inconsistency or discrepancy between any of the servicing provisions of this
Agreement and any of the servicing provisions of the ▇▇▇▇▇▇ ▇▇▇ Guides, the
provisions of this Agreement shall control and be binding upon the Purchaser
and the Interim Servicer. Notwithstanding anything in this Article II to the
contrary, with respect to any action to be taken or not taken with respect to
the servicing of the Mortgage Loans that requires the consent or approval of
the Purchaser, after a Securitization Transfer with respect to the related
Mortgage Loan, such
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consent shall be exercised by the Interim Servicer as servicer of the Mortgage
Loans in accordance with Accepted Servicing Practices.
Consistent with the terms of this Agreement, the Interim Servicer
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 if in the Interim Servicer's reasonable and
prudent determination such waiver, modification, postponement or indulgence is
not materially adverse to the Purchaser, provided, however, that the Interim
Servicer shall not make any future advances with respect to a Mortgage Loan
and (unless the Mortgagor is in default with respect to the Mortgage Loan or
such default is, in the judgment of the Interim Servicer, imminent and the
Interim Servicer has obtained the prior written consent of the Purchaser) the
Interim Servicer shall not permit any modification of any material term of any
Mortgage Loan including any modifications that would change the Mortgage
Interest Rate, defer or forgive the payment of principal or interest, reduce
or increase the outstanding principal balance (except for actual payments of
principal) or change the final maturity date on such Mortgage Loan. In the
event of any such modification which permits the deferral of interest or
principal payments on any Mortgage Loan, the Interim Servicer shall, on the
Business Day immediately preceding the Remittance Date in any month in which
any such principal or interest payment has been deferred, deposit in the
Custodial Account from its own funds, in accordance with Section 3.03, the
difference between (a) such month's principal and interest due at the Mortgage
Loan Remittance Rate on the unpaid principal balance of such Mortgage Loan and
(b) the amount paid by the Mortgagor. The Interim Servicer shall be entitled
to reimbursement for such advances to the same extent as for all other
advances made pursuant to Section 3.03. Notwithstanding the foregoing, the
Interim Servicer shall not waive any Prepayment Penalty or portion thereof
unless (i) the enforceability thereof shall have been limited by bankruptcy,
insolvency, moratorium, receivership or other similar laws relating to
creditors' rights generally or is otherwise prohibited by law, or (ii) the
enforceability thereof shall have been permanently limited due to acceleration
in connection with a foreclosure or other involuntary payment or (iii) in the
Interim Servicer's reasonable judgment, (x) such waiver relates to a default
or a reasonably foreseeable default, (y) such waiver would maximize recovery
of total proceeds taking into account the value of such Prepayment Penalty and
related Mortgage Loan and (z) doing so is standard and customary in servicing
Mortgage Loans (including any waiver of a Prepayment Penalty in connection
with a refinancing of a Mortgage Loan that is related to a default or
reasonably foreseeable default). Except as provided in the preceding sentence,
in no event will the Interim Servicer waive a Prepayment Penalty in connection
with a refinancing of a Mortgage Loan that is not related to a default or a
reasonably foreseeable default. If the Interim Servicer waives or does not
collect all or a portion of a Prepayment Penalty relating to a Principal
Prepayment in full or in part due to any action or omission of the Interim
Servicer, other than as permitted above, the Interim Servicer shall deposit
from its own funds without any right of reimbursement therefor the amount of
such Prepayment Penalty (or such portion thereof as had been waived for
deposit) into the Custodial Account for distribution in accordance with the
terms of this Agreement. In connection with any waiver of a Prepayment Penalty
by the Interim Servicer, the Interim Servicer shall account for such waiver in
its monthly reports as agreed upon by the Interim Servicer and the Purchaser.
Without limiting the generality of the foregoing, the Interim Servicer shall
continue, and is hereby authorized and empowered, to execute and deliver on
behalf of itself and the Purchasers, all instruments of satisfaction or
cancellation, or of partial or full release, discharge and all other
comparable
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instruments, with respect to the Mortgage Loans and with respect to the
Mortgaged Properties. If reasonably required by the Interim Servicer, the
Purchaser shall furnish the Interim Servicer with any powers of attorney and
other documents necessary or appropriate to enable the Interim Servicer to
carry out its servicing and administrative duties under this Agreement.
In servicing and administering the Mortgage Loans, the Interim
Servicer shall employ procedures (including collection procedures) and
exercise the same care that it customarily employs and exercises in servicing
and administering mortgage loans (similar in quality to the Mortgage Loans)
for its own account, and shall follow Accepted Servicing Practices where such
practices do not conflict with the requirements of this Agreement, and the
Purchaser's reliance on the Interim Servicer.
Section 2.02 Liquidation of Mortgage Loans.
In the event that any payment due under any Mortgage Loan and not
postponed pursuant to Section 2.01 is not paid when the same becomes due and
payable, or in the event the Mortgagor fails to perform any other covenant or
obligation under the Mortgage Loan and such failure continues beyond any
applicable grace period, the Interim Servicer shall take such action as (1)
the Interim Servicer would take under similar circumstances with respect to a
similar mortgage loan held for its own account for investment, (2) shall be
consistent with Accepted Servicing Practices, (3) the Interim Servicer shall
determine prudently to be in the best interest of Purchaser, and (4) is
consistent with any related PMI Policy or other applicable insurance or
guaranty, if any. In the event that any payment due under any Mortgage Loan is
not postponed pursuant to Section 2.01 and remains delinquent for a period of
90 days or any other default continues for a period of 90 days beyond the
expiration of any grace or cure period, the Interim Servicer shall commence
foreclosure proceedings, provided that, prior to commencing foreclosure
proceedings, the Interim Servicer shall notify the Purchaser in writing of the
Interim Servicer's intention to do so, and the Interim Servicer shall not
commence foreclosure proceedings if the Purchaser objects to such action
within 10 Business Days of receiving such notice. In the event the Purchaser
objects to such foreclosure action, the Interim Servicer shall not be required
to make Servicing Advances with respect to such Mortgage Loan, pursuant to
Section 3.03, and the Interim Servicer's obligation to make such Servicing
Advances shall terminate on the 90th day referred to above. In such
connection, the Interim Servicer shall from its own funds make all necessary
and proper Servicing Advances, provided, however, that the Interim Servicer
shall not be required to expend its own funds in connection with any
foreclosure or towards the restoration or preservation of any Mortgaged
Property, unless it shall determine that such expenses will be recoverable by
it either through Liquidation Proceeds (respecting which it shall have
priority for purposes of withdrawals from the Custodial Account pursuant to
Section 2.05) or through Insurance Proceeds (respecting which it shall have
similar priority).
Notwithstanding anything to the contrary contained herein, in
connection with a foreclosure or acceptance of a deed in lieu of foreclosure,
in the event the Interim Servicer has reasonable cause to believe that a
Mortgaged Property is contaminated by hazardous or toxic substances or wastes,
or if the Purchaser otherwise requests an environmental inspection or review
of such Mortgaged Property to be conducted by a qualified inspector, the
Interim Servicer shall cause such property to be inspected by a qualified
environmental consulting firm. Upon
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completion of the inspection, the Interim Servicer shall promptly provide the
Purchaser with a written report of the environmental inspection.
After reviewing the environmental inspection report, the Purchaser
shall determine how the Interim Servicer shall proceed with respect to the
Mortgaged Property. In the event (a) the environmental inspection report
indicates that the Mortgaged Property is contaminated by hazardous or toxic
substances or wastes and (b) the Purchaser directs the Interim Servicer to
proceed with foreclosure or acceptance of a deed in lieu of foreclosure, the
Interim Servicer shall be reimbursed for all reasonable costs associated with
such foreclosure or acceptance of a deed in lieu of foreclosure and any
related environmental clean up costs, as applicable, from the related
Liquidation Proceeds, or if the Liquidation Proceeds are insufficient to fully
reimburse the Interim Servicer, the Interim Servicer shall be entitled to be
reimbursed from amounts in the Custodial Account pursuant to Section 2.05
hereof. In the event the Purchaser directs the Interim Servicer not to proceed
with foreclosure or acceptance of a deed in lieu of foreclosure, the Interim
Servicer shall be reimbursed for all Servicing Advances made with respect to
the related Mortgaged Property from the Custodial Account pursuant to Section
2.05 hereof.
Section 2.03 Collection of Mortgage Loan Payments.
Continuously from the related Closing Date for each pool of
Mortgage Loans purchased hereunder until the related Transfer Date, the
Interim Servicer shall proceed diligently to collect all payments due under
each of the Mortgage Loans when the same shall become due and payable and
shall take special care in ascertaining and estimating Escrow Payments and all
other charges that will become due and payable with respect to the Mortgage
Loan and the Mortgaged Property, to the end that the installments payable by
the Mortgagors will be sufficient to pay such charges as and when they become
due and payable.
Section 2.04 Establishment of and Deposits to Custodial Account.
The Interim Servicer shall segregate and hold all funds collected
and received pursuant to a Mortgage Loan separate and apart from any of its
own funds and general assets and shall establish and maintain one or more
Custodial Accounts, in the form of time deposit or demand accounts, titled
"EverBank, as Interim Servicer, in trust for ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital
Inc. and/or subsequent Purchasers of fixed and adjustable rate Mortgage
Loans." The Custodial Account shall be established with a Qualified Depository
acceptable to the Purchaser. Any funds deposited in the Custodial Account
shall at all times be fully insured to the full extent permitted under
applicable law. Funds deposited in the Custodial Account may be drawn on by
the Interim Servicer in accordance with Section 2.05. The creation of any
Custodial Account shall be evidenced by a certification in the form of Exhibit
D-1 hereto, in the case of an account established with the Interim Servicer,
or by a letter agreement in the form of Exhibit D-2 hereto, in the case of an
account held by a depository other than the Interim Servicer. A copy of such
certification or letter agreement shall be furnished to the Purchaser and,
upon request, to any subsequent Purchaser.
The Interim Servicer shall deposit in the Custodial Account on a
daily basis, and retain therein, the following collections received by the
Interim Servicer and payments made by
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the Interim Servicer after the related Cut-off Date (other than payments of
principal and interest due on or before the related Cut-off Date, which
amounts shall be remitted to the Interim Servicer).
(i) all payments on account of principal on the Mortgage Loans,
including all Principal Prepayments;
(ii) all payments on account of interest on the Mortgage Loans;
(iii) all Liquidation Proceeds and any amounts received with
respect to REO Property;
(iv) all Insurance Proceeds including amounts required to be
deposited pursuant to Section 2.10 (other than proceeds to be held in
the Escrow Account and applied to the restoration or repair of the
Mortgaged Property or released to the Mortgagor in accordance with
Section 2.14), Section 2.11 and Section 2.15;
(v) all Condemnation Proceeds which are not applied to the
restoration or repair of the Mortgaged Property or released to the
Mortgagor in accordance with Section 2.14;
(vi) any amount required to be deposited in the Custodial Account
pursuant to Section 2.01, 2.09, 3.01, 3.03, 4.01 or 4.02;
(vii) any amounts payable in connection with the repurchase of any
Mortgage Loan in accordance with the Purchase Agreement;
(viii) any Prepayment Penalties received with respect to any
Mortgage Loan;
(ix) any amounts required to be deposited by the Interim Servicer
pursuant to Section 2.11 in connection with the deductible clause in any
blanket hazard insurance policy; and
(x) any amounts received with respect to or related to any REO
Property and all REO Disposition Proceeds pursuant to Section 2.16.
The foregoing requirements for deposit into the Custodial Account
shall be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of Ancillary Income,
including late payment charges and assumption fees, to the extent permitted by
Section 2.01, need not be deposited by the Interim Servicer into the Custodial
Account. Any interest paid on funds deposited in the Custodial Account by the
depository institution shall accrue to the benefit of the Interim Servicer and
the Interim Servicer shall be entitled to retain and withdraw such interest
from the Custodial Account pursuant to Section 2.05. Prior to changing the
location of the Custodial Account, the Interim Servicer shall give notice to
the Purchaser of such change, which notice shall set forth the new location of
the Custodial Account when established. The Interim Servicer shall maintain
adequate records with respect to all withdrawals made pursuant to this Section
2.04. All funds required to be deposited
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in the Custodial Account shall be held in trust for the Purchaser until
withdrawn in accordance with Section 2.05.
Section 2.05 Permitted Withdrawals From Custodial Account.
The Interim Servicer shall, from time to time, withdraw funds from
the Custodial Account for the following purposes:
(i) to make payments to the Purchaser in the amounts and in the
manner provided for in Section 3.01;
(ii) to reimburse itself for unreimbursed Servicing Advances, and
for any unpaid Servicing Fees, any unpaid advances by the Interim
Servicer in accordance with Section 3.03, the Interim Servicer's right
to reimburse itself pursuant to this subclause (iii) with respect to any
Mortgage Loan being limited to related Liquidation Proceeds,
Condemnation Proceeds, Insurance Proceeds (not required to be remitted
to the Mortgagor) and such other amounts as may be collected by the
Interim Servicer from the Mortgagor or otherwise relating to the
Mortgage Loan, it being understood that, in the case of any such
reimbursement, the Interim Servicer's right thereto shall be prior to
the rights of Purchaser except where the Interim Servicer is required to
repurchase a Mortgage Loan pursuant to the Purchase Agreement or Section
6.02, in which case the Interim Servicer's right to such reimbursement
shall be subsequent to the payment to the Purchaser of the Repurchase
Price pursuant to such sections and all other amounts required to be
paid to the Purchaser with respect to such Mortgage Loan;
(iii) to pay itself any investment earnings accrued on funds
deposited in the Custodial Account;
(iv) to pay to itself the Servicing Fee in accordance with Section
4.03 and to reimburse itself for expenses incurred and reimbursable to
it pursuant to Section 8.01;
(v) to pay any amount required to be paid pursuant to Section 4.16
related to any REO Property, it being understood that in the case of any
such expenditure or withdrawal related to a particular REO Property, the
amount of such expenditure or withdrawal from the Custodial Account
shall be limited to amounts on deposit in the Custodial Account with
respect to the related REO Property;
(vi) to clear and terminate the Custodial Account upon the
termination of this Agreement; and
(vii) to withdraw funds deposited in error.
In the event that the Custodial Account is interest bearing, on each
Remittance Date, the Interim Servicer shall withdraw all funds from the
Custodial Account except for those amounts which, pursuant to Section 3.01,
the Interim Servicer is not obligated to remit on such Remittance Date. The
Interim Servicer may use such withdrawn funds only for the purposes described
in this Section 2.05. The Interim Servicer shall keep and maintain a separate
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accounting, on a Mortgage Loan by Mortgage Loan basis, for the purpose of
justifying any withdrawals from the Custodial Account.
Section 2.06 Establishment of and Deposits to Escrow Account.
The Interim Servicer shall segregate and hold all funds collected
and received pursuant to a Mortgage Loan constituting Escrow Payments separate
and apart from any of its own funds and general assets and shall establish and
maintain one or more Escrow Accounts, in the form of time deposit or demand
accounts, titled, "EverBank., as Interim Servicer, in trust for the ▇▇▇▇▇▇
▇▇▇▇▇▇▇ Mortgage Capital Inc. and/or subsequent purchasers of Mortgage Loans
and various Mortgagors." The Escrow Accounts shall be established with a
Qualified Depository, in a manner which shall provide maximum available
insurance thereunder. Funds deposited in the Escrow Account may be drawn on by
the Interim Servicer in accordance with Section 2.07. The creation of any
Escrow Account shall be evidenced by a certification in the form of Exhibit
E-1 hereto, in the case of an account established with the Interim Servicer,
or by a letter agreement in the form of Exhibit E-2 hereto, in the case of an
account held by a depository other than the Interim Servicer. A copy of such
certification shall be furnished to the Purchaser and, upon request, to any
subsequent Purchaser.
The Interim Servicer shall deposit in the Escrow Account or
Accounts on a daily basis, and retain therein:
(i) all Escrow Payments collected on account of the Mortgage
Loans, for the purpose of effecting timely payment of any such items as
required under the terms of this Agreement; and
(ii) all amounts representing Insurance Proceeds or Condemnation
Proceeds which are to be applied to the restoration or repair of any
Mortgaged Property.
The Interim Servicer shall make withdrawals from the Escrow
Account only to effect such payments as are required under this Agreement, as
set forth in Section 2.07. The Interim Servicer shall be entitled to retain
any interest paid on funds deposited in the Escrow Account by the depository
institution, other than interest on escrowed funds required by law or the
applicable Mortgage Loan Documents to be paid to the Mortgagor. To the extent
required by law, the Interim Servicer shall pay from its own funds interest on
escrowed funds to the Mortgagor notwithstanding that the Escrow Account may be
non-interest bearing or that interest paid thereon is insufficient for such
purposes.
Section 2.07 Permitted Withdrawals From Escrow Account.
Withdrawals from the Escrow Account or Accounts may be made by the
Interim Servicer only:
(i) to effect timely payments of ground rents, taxes, assessments,
water rates, mortgage insurance premiums, condominium charges, fire and
hazard insurance premiums or other items constituting Escrow Payments
for the related Mortgage;
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(ii) to reimburse the Interim Servicer for any Servicing Advances
made by the Interim Servicer pursuant to Section 2.08 with respect to a
related Mortgage Loan, but only from amounts received on the related
Mortgage Loan which represent late collections of Escrow Payments
thereunder;
(iii) to refund to any Mortgagor any funds found to be in excess
of the amounts required under the terms of the related Mortgage Loan or
applicable federal or state law or judicial or administrative ruling;
(iv) for transfer to the Custodial Account and application to
reduce the principal balance of the Mortgage Loan in accordance with the
terms of the related Mortgage and Mortgage Note;
(v) for application to restoration or repair of the Mortgaged
Property in accordance with the procedures outlined in Section 2.14;
(vi) to pay to the Interim Servicer, or any Mortgagor to the
extent required by law, any interest paid on the funds deposited in the
Escrow Account;
(vii) to clear and terminate the Escrow Account on the termination
of this Agreement; and
(viii) to withdraw funds deposited in error.
Section 2.08 Payment of Taxes, Insurance and Other Charges.
With respect to each Mortgage Loan, the Interim Servicer shall
maintain accurate records reflecting the status of ground rents, taxes,
assessments, water rates, sewer rents, and other charges which are or may
become a lien upon the Mortgaged Property and the status of PMI Policy
premiums and fire and hazard insurance coverage and shall obtain, from time to
time, all bills for the payment of such charges (including renewal premiums)
and shall effect payment thereof prior to the applicable penalty or
termination date and at a time appropriate for securing maximum discounts
allowable, if any, employing for such purpose deposits of the Mortgagor in the
Escrow Account which shall have been estimated and accumulated by the Interim
Servicer 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, the Interim Servicer shall determine that any such payments are made
by the Mortgagor at the time they first become due. The Interim Servicer
assumes full responsibility for the timely payment of all such bills and shall
effect timely payment of all such charges irrespective of each Mortgagor's
faithful performance in the payment of same or the making of the Escrow
Payments, and the Interim Servicer shall make Servicing Advances from its own
funds to effect such payments within such time period as will avoid the loss
of the related Mortgaged Property by foreclosure of a tax or other lien.
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Section 2.09 Protection of Accounts.
The Interim Servicer may transfer the Custodial Account or the
Escrow Account to a different Qualified Depository from time to time. Such
transfer shall be made only upon obtaining the consent of the Purchaser, which
consent shall not be withheld unreasonably.
The Interim Servicer shall bear any expenses, losses or damages
sustained by the Purchaser because the Custodial Account and/or the Escrow
Account are not demand deposit accounts.
Amounts on deposit in the Custodial Account and the Escrow Account
may at the option of the Interim Servicer be invested in Eligible Investments;
provided that in the event that amounts on deposit in the Custodial Account or
the Escrow Account exceed the amount fully insured by the FDIC (the "Insured
Amount") the Interim Servicer shall be obligated to invest the excess amount
over the Insured Amount in Eligible Investments on the same Business Day as
such excess amount becomes present in the Custodial Account or the Escrow
Account. Any such Eligible Investment shall mature no later than the
Determination Date next following the date of such Eligible Investment,
provided, however, that if such Eligible Investment is an obligation of a
Qualified Depository (other than the Interim Servicer) that maintains the
Custodial Account or the Escrow Account, then such Eligible Investment may
mature on such Remittance Date. Any such Eligible Investment shall be made in
the name of the Interim Servicer in trust for the benefit of the Purchaser.
All income on or gain realized from any such Eligible Investment shall be for
the benefit of the Interim Servicer and may be withdrawn at any time by the
Interim Servicer. Any losses incurred in respect of any such investment shall
be deposited in the Custodial Account or the Escrow Account, by the Interim
Servicer out of its own funds immediately as realized.
Section 2.10 Maintenance of Hazard Insurance.
The Interim Servicer shall cause to be maintained for each
Mortgage Loan hazard insurance such that all buildings upon the Mortgaged
Property are insured by a generally acceptable insurer rated A:VI or better in
the current Best's Key Rating Guide ("Best's") or by an insurer acceptable to
▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, GNMA or VA, as applicable, against loss by fire,
hazards of extended coverage and such other hazards as are customary in the
area where the Mortgaged Property is located, in an amount which is at least
equal to the lesser of (i) the replacement value of the improvements securing
such Mortgage Loan and (ii) the greater of (a) the outstanding principal
balance of the Mortgage Loan and (b) an amount such that the proceeds thereof
shall be sufficient to prevent the Mortgagor or the loss payee from becoming a
co-insurer.
If the related Mortgaged Property is located in an area identified
in the Federal Register by the Flood Emergency Management Agency as having
special flood hazards (and such flood insurance has been made available) a
flood insurance policy meeting the requirements of the current guidelines of
the Federal Insurance Administration is in effect with a generally acceptable
insurance carrier rated A:VI or better in Best's or in accordance with then
current ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, GNMA or VA guidelines, as applicable, in an
amount representing coverage not less than the lesser of (i) the minimum
amount required, under the terms of
14
coverage, to compensate for any damage or loss on a replacement cost basis (or
the unpaid balance of the mortgage if replacement cost coverage is not
available for the type of building insured) and (ii) the maximum amount of
insurance which is available under the Flood Disaster Protection Act of 1973,
as amended. If at any time during the term of the Mortgage Loan, the Interim
Servicer determines in accordance with applicable law and pursuant to the then
current ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac or GNMA guidelines, as applicable, that a
Mortgaged Property is located in a special flood hazard area and is not
covered by flood insurance or is covered in an amount less than the amount
required by the Flood Disaster Protection Act of 1973, as amended, the Interim
Servicer shall notify the related Mortgagor that the Mortgagor must obtain
such flood insurance coverage, and if said Mortgagor fails to obtain the
required flood insurance coverage within forty-five (45) days after such
notification, the Interim Servicer shall immediately force place the required
flood insurance on the Mortgagor's behalf.
If a Mortgage is secured by a unit in a condominium project, the
Interim Servicer shall verify that the coverage required of the owner's
association, including hazard, flood, liability, and fidelity coverage, is
being maintained in accordance with then current ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac or
GNMA requirements, as applicable, and secure from the owner's association its
agreement to notify the Interim Servicer promptly of any change in the
insurance coverage or of any condemnation or casualty loss that may have a
material effect on the value of the Mortgaged Property as security.
The Interim Servicer shall cause to be maintained on each
Mortgaged Property earthquake or such other or additional insurance as may be
required pursuant to such applicable laws and regulations as shall at any time
be in force and as shall require such additional insurance, or pursuant to the
requirements of any private mortgage guaranty insurer, or as may be required
to conform with Accepted Servicing Practices.
In the event that any Purchaser or the Interim Servicer shall
determine that the Mortgaged Property should be insured against loss or damage
by hazards and risks not covered by the insurance required to be maintained by
the Mortgagor pursuant to the terms of the Mortgage, the Interim Servicer
shall communicate and consult with the Mortgagor with respect to the need for
such insurance and bring to the Mortgagor's attention the desirability of
protection of the Mortgaged Property.
All policies required hereunder shall name the Interim Servicer
and its successors and assigns as a mortgagee and as loss payee and shall be
endorsed with standard or union mortgagee clauses, without contribution, which
shall provide for at least 30 days prior written notice of any cancellation,
reduction in amount or material change in coverage.
The Interim Servicer shall not interfere with the Mortgagor's
freedom of choice in selecting either his insurance carrier or agent,
provided, however, that the Interim Servicer shall not accept any such
insurance policies from insurance companies unless such companies are rated
A:VI or better in Best's or meet ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac or GNMA requirements,
as applicable, and are licensed to do business in the jurisdiction in which
the Mortgaged Property is located. The Interim Servicer shall determine that
such policies provide sufficient risk coverage and amounts, that they insure
the property owner, and that they properly describe the property address. The
Interim Servicer shall furnish to the Mortgagor a formal notice of expiration
of any
15
such insurance in sufficient time for the Mortgagor to arrange for renewal
coverage by the expiration date; provided, however, that in the event that no
such notice is furnished by the Interim Servicer, the Interim Servicer shall
ensure that replacement insurance policies are in place in the required
coverages and the Interim Servicer shall be solely liable for any losses in
the event coverage is not provided.
Pursuant to Section 2.04, any amounts collected by the Interim
Servicer under any such policies (other than amounts to be deposited in the
Escrow Account and applied to the restoration or repair of the related
Mortgaged Property, or property acquired in liquidation of the Mortgage Loan,
or to be released to the Mortgagor, in accordance with the Interim Servicer's
normal servicing procedures as specified in Section 2.14) shall be deposited
in the Custodial Account subject to withdrawal pursuant to Section 2.05.
Section 2.11 Maintenance of Mortgage Impairment Insurance.
In the event that the Interim Servicer shall obtain and maintain
at its own expense a blanket policy insuring against losses arising from fire
and hazards covered under extended coverage on all of the Mortgage Loans,
then, to the extent such policy provides coverage in an amount equal to the
amount required pursuant to Section 2.10 and otherwise complies with all other
requirements of Section 2.10, it shall conclusively be deemed to have
satisfied its obligations as set forth in Section 2.10. Any such policy shall
be issued by an issuer that has a Best rating of A:VI or better. Any amounts
collected by the Interim Servicer under any such policy relating to a Mortgage
Loan shall be deposited in the Custodial Account subject to withdrawal
pursuant to Section 2.05. Such policy may contain a deductible clause, in
which case, in the event that there shall not have been maintained on the
related Mortgaged Property a policy complying with Section 2.10, and there
shall have been a loss which would have been covered by such policy, the
Interim Servicer shall deposit in the Custodial Account at the time of such
loss the amount not otherwise payable under the blanket policy because of such
deductible clause, such amount to be deposited from the Interim Servicer's
funds, without reimbursement therefor. Upon request of the Purchaser, the
Interim Servicer shall cause to be delivered to the Purchaser a certified true
copy of such policy and a statement from the insurer thereunder that such
policy shall in no event be terminated or materially modified without 30 days'
prior written notice to the Purchaser.
Section 2.12 Maintenance of Fidelity Bond and Errors and
Omissions Insurance.
The Interim Servicer shall maintain with responsible companies, at
its own expense, a blanket Fidelity Bond and an Errors and Omissions Insurance
Policy that meets the requirements of ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, 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 ("Interim Servicer Employees"). Any such Fidelity Bond and
Errors and Omissions Insurance Policy shall be in the form of the Mortgage
Banker's Blanket Bond and shall protect and insure the Interim Servicer
against losses, including forgery, theft, embezzlement, fraud, errors and
omissions and negligent acts of such Interim Servicer Employees. Such Fidelity
Bond and Errors and Omissions Insurance Policy also shall protect and insure
the Interim Servicer 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
16
provision of this Section 2.12 requiring such Fidelity Bond and Errors and
Omissions Insurance Policy shall diminish or relieve the Interim Servicer from
its duties and obligations as set forth in this Agreement. The minimum
coverage under any such bond and insurance policy shall be acceptable to
▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac or GNMA, as applicable. Upon the request of the
Purchaser, the Interim Servicer shall cause to be delivered to such Purchaser
a certified true copy of such fidelity bond and insurance policy and a
statement from the surety and the insurer that such fidelity bond and
insurance policy shall in no event be terminated or materially modified
without 30 days' prior written notice to the Purchaser.
Section 2.13 Inspections.
The Interim Servicer shall inspect the Mortgaged Property in
accordance with Accepted Servicing Practices to assure itself that the value
of the Mortgaged Property is being preserved. In addition, if any Mortgage
Loan is more than 60 days delinquent, the Interim Servicer immediately shall
inspect the Mortgaged Property and shall conduct subsequent inspections in
accordance with Accepted Servicing Practices or as may be required by the
primary mortgage guaranty insurer. The Interim Servicer shall keep a written
report of each such inspection.
Section 2.14 Restoration of Mortgaged Property.
The Interim Servicer need not obtain the approval of the Purchaser
prior to releasing any Insurance Proceeds or Condemnation Proceeds to the
Mortgagor to be applied to the restoration or repair of the Mortgaged Property
if such release is in accordance with Accepted Servicing Practices and the
terms of this Agreement. At a minimum, the Interim Servicer shall comply with
the following conditions in connection with any such release of Insurance
Proceeds or Condemnation Proceeds:
(i) the Interim Servicer shall receive satisfactory independent
verification of completion of repairs and issuance of any required
approvals with respect thereto;
(ii) the Interim Servicer shall take all steps necessary to
preserve the priority of the lien of the Mortgage, including, but not
limited to requiring waivers with respect to mechanics' and
materialmen's liens;
(iii) the Interim Servicer shall verify that the Mortgage Loan is
not in default; and
(iv) pending repairs or restoration, the Interim Servicer shall
place the Insurance Proceeds or Condemnation Proceeds in the Escrow
Account.
If the Purchaser is named as an additional loss payee, the Interim
Servicer is hereby empowered to endorse any loss draft issued in respect of
such a claim in the name of the Purchaser.
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Section 2.15 Maintenance of PMI Policy; Claims.
(a) With respect to each Mortgage Loan with a LTV in excess of
80%, the Interim Servicer shall, in accordance with state and federal laws and
without any cost to the Purchaser, maintain or cause the Mortgagor to maintain
in full force and effect a PMI Policy insuring that portion of the Mortgage
Loan in excess of 75% (or such other percentage as stated in the related
Purchase Price and Terms Agreement) of value, and shall pay or shall cause the
Mortgagor to pay the premium thereon on a timely basis, until the LTV of such
Mortgage Loan is reduced to 80%. In the event that such PMI Policy shall be
terminated, the Interim Servicer shall obtain from another Qualified Insurer a
comparable replacement policy, with a total coverage equal to the remaining
coverage of such terminated PMI Policy, at substantially the same fee level.
If the insurer shall cease to be a Qualified Insurer, the Interim Servicer
shall determine whether recoveries under the PMI Policy are jeopardized for
reasons related to the financial condition of such insurer, it being
understood that the Interim Servicer shall in no event have any responsibility
or liability for any failure to recover under the PMI Policy for such reason.
If the Interim Servicer determines that recoveries are so jeopardized, it
shall notify the Purchaser and the Mortgagor, if required, and obtain from
another Qualified Insurer a replacement insurance policy. The Interim Servicer
shall not take any action which would result in noncoverage under any
applicable PMI Policy of any loss which, but for the actions of the Interim
Servicer would have been covered thereunder. In connection with any assumption
or substitution agreement entered into or to be entered into pursuant to
Section 2.01, the Interim Servicer shall promptly notify the insurer under the
related PMI Policy, if any, of such assumption or substitution of liability in
accordance with the terms of such PMI Policy and shall take all actions which
may be required by such insurer as a condition to the continuation of coverage
under such PMI Policy. If such PMI Policy is terminated as a result of such
assumption or substitution of liability, the Interim Servicer shall obtain a
replacement PMI Policy as provided above.
(b) In connection with its activities as servicer, the Interim
Servicer agrees to prepare and present, on behalf of itself and the Purchaser,
claims to the insurer under any PMI Policy in a timely fashion in accordance
with the terms of such PMI Policy and, in this regard, to take such action as
shall be necessary to permit recovery under any PMI Policy respecting a
defaulted Mortgage Loan. Pursuant to Section 2.04, any amounts collected by
the Interim Servicer under any PMI Policy shall be deposited in the Custodial
Account, subject to withdrawal pursuant to Section 2.05.
(c) Purchaser, in its sole discretion, at any time, may (i) either
obtain an additional PMI Policy on any Mortgage Loan which already has a PMI
Policy in place, or (ii) obtain a PMI Policy for any Mortgage Loan which does
not already have a PMI Policy in place. In any event, the Interim Servicer
agrees to administer such PMI Policies in accordance with the Agreement or any
Reconstitution Agreement.
Section 2.16 Title, Management and Disposition of REO Property.
In the event that title to any Mortgaged Property is acquired in
foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale
shall be taken in the name of the Interim Servicer or its designee on behalf
of the Purchaser, or in the event the Purchaser or its designee is
18
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 issued in the name of such Person or Persons as
shall be consistent with an Opinion of Counsel obtained by the Interim
Servicer from any attorney duly licensed to practice law in the state where
the REO Property is located. The Person or Persons holding such title other
than the Purchaser shall acknowledge in writing that such title is being held
as nominee for the Purchaser.
The Interim Servicer shall manage, conserve, protect and operate
each REO Property for the Purchaser solely for the purpose of its prompt
disposition and sale. The Interim Servicer, either itself or through an agent
selected by the Interim Servicer, shall 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 property in the same locality as the REO Property is managed. The
Interim Servicer shall attempt to sell the same (and may temporarily rent the
same for a period not greater than one year, except as otherwise provided
below) on such terms and conditions as the Interim Servicer deems to be in the
best interest of the Purchaser and if an election is or is to be made to treat
the arrangement under which any Mortgage Loan and any REO Property are held as
a real estate mortgage investment conduit within the meaning of Section 860D
of the Code (a "REMIC"), the Interim Servicer shall service each such Mortgage
Loan and REO Property in a manner which does not cause the REMIC to fail to
qualify as a REMIC or result in the imposition of a tax upon the REMIC
(including but not limited to the tax on "prohibited transactions" as defined
in Section 860F(a)(2) of the Code, the tax on "contributions" to a REMIC set
forth in Section 860G(d) of the Code and the tax on "net income from
foreclosure property" as set forth in Section 860G(c) of the Code).
The Interim Servicer shall use its best efforts to dispose of the
REO Property as soon as possible and shall sell such REO Property in any event
within one year after title has been taken to such REO Property, unless the
Interim Servicer determines, and gives an appropriate notice to the Purchaser
to such effect, that a longer period is necessary for the orderly liquidation
of such REO Property. If a period longer than one year (but in no event in
excess of three years) is permitted under the foregoing sentence and is
necessary to sell any REO Property, (i) the Interim Servicer shall report
monthly to the Purchaser as to the progress being made in selling such REO
Property and (ii) if, with the written consent of the Purchaser, a purchase
money mortgage is taken in connection with such sale, such purchase money
mortgage shall name the Interim Servicer as mortgagee, and such purchase money
mortgage shall not be held pursuant to this Agreement, but instead a separate
participation agreement among the Interim Servicer and Purchaser shall be
entered into with respect to such purchase money mortgage.
The Interim Servicer shall also maintain on each REO Property fire
and hazard insurance with extended coverage in 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 Flood Disaster Protection Act of 1973, as amended, flood insurance in the
amount required above.
The disposition of REO Property shall be carried out by the
Interim Servicer at such price, and upon such terms and conditions, as the
Interim Servicer deems to be in the best
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interests of the Purchaser and provided the sales price and related terms and
conditions are results of arm's-length negotiation. No REO disposition shall
be effected without the prior written consent of the Purchaser. The proceeds
of sale of the REO Property shall be promptly deposited in the Custodial
Account. As soon as practical thereafter the expenses of such sale shall be
paid and the Interim Servicer shall reimburse itself for any related
unreimbursed Servicing Advances, unpaid Servicing Fees and unreimbursed
advances made pursuant to Section 3.03, and on the Remittance Date immediately
following the Principal Prepayment Period in which such sale proceeds are
received the net cash proceeds of such sale remaining in the Custodial Account
shall be distributed to the Purchaser.
With respect to each REO Property, the Interim Servicer shall hold
all funds collected and received in connection with the operation of the REO
Property in the Custodial Account. The Interim Servicer shall cause to be
deposited on a daily basis upon the receipt thereof in each Custodial Account
all revenues received with respect to the conservation and disposition of the
related REO Property. The Interim Servicer shall withdraw the Custodial
Account funds necessary for the proper operation, management and maintenance
of the REO Property, including the cost of maintaining any hazard insurance
pursuant to Section 2.10 and the fees of any managing agent acting on behalf
of the Interim Servicer or the Interim Servicer itself. The REO management fee
shall be an amount that is reasonable and customary in the area where the
Mortgaged Property is located. The Interim Servicer shall make monthly
distributions on each Remittance Date to the Purchaser of the net cash flow
from the REO Property (which shall equal the revenues from such REO Property
net of the expenses described in the Section 2.16 and of any reserves
reasonably required from time to time to be maintained to satisfy anticipated
liabilities for such expenses).
Notwithstanding the foregoing, at any time and from time to time,
the Purchaser may at its election terminate this Agreement with respect to one
or more REO Properties as provided by Section 10.02.
Section 2.17 Real Estate Owned Reports.
Together with the statement furnished pursuant to Section 3.02,
the Interim Servicer shall furnish to the Purchaser on or before the
Remittance Date each month a statement with respect to any REO Property
covering the operation of such REO Property for the previous month and the
Interim Servicer's efforts in connection with the sale of such REO Property
and any rental of such REO Property incidental to the sale thereof for the
previous month. That statement shall be accompanied by such other information
as the Purchaser shall reasonably request.
Section 2.18 Liquidation Reports.
Upon the foreclosure sale of any Mortgaged Property or the
acquisition thereof by the Interim Servicer on behalf of the Purchaser
pursuant to a deed in lieu of foreclosure, the Interim Servicer shall submit
to the Purchaser a liquidation report with respect to such Mortgaged Property.
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Section 2.19 Reports of Foreclosures and Abandonments of Mortgaged
Property.
Following the foreclosure sale or abandonment of any Mortgaged
Property, the Interim Servicer shall report such foreclosure or abandonment as
required pursuant to Section 6050J of the Code or any successor provision
thereto.
Section 2.20 Notification of Adjustments
On each Adjustment Date, the Interim Servicer shall make interest
rate adjustments for each Mortgage Loan in compliance with the applicable law
and requirements of the related Mortgage and Mortgage Note. If, pursuant to
the terms of the Mortgage Note, a new index is selected for determining the
Mortgage Interest Rate, such index will be used with respect to each Mortgage
Note which requires a new index to be selected, provided that such selection
does not conflict with the terms of the related Mortgage and Mortgage Note.
The Interim Servicer shall execute and deliver the notices required by each
Mortgage and Mortgage Note regarding interest rate adjustments. The Interim
Servicer also shall provide timely notification to the Purchaser of all
applicable data and information regarding such interest rate adjustments and
the Interim Servicer's methods of implementing such interest rate adjustments.
Upon the discovery by the Interim Servicer or the Purchaser that the Interim
Servicer has failed to adjust a Mortgage Interest Rate or a Monthly Payment
pursuant to the terms of the related Mortgage Note and Mortgage, the Interim
Servicer shall immediately deposit in the Custodial Account from its own funds
the amount of any interest loss caused thereby without reimbursement therefor.
Section 2.21 Transfer of Servicing.
(a) On or prior to the applicable Transfer Date, the Interim
Servicer shall, at its sole cost and expense, take such steps as may be
necessary or appropriate to effectuate and evidence the transfer of the
servicing of the related Mortgage Loans to the Purchaser, or its designee,
including but not limited to the following:
(A) Notice to Mortgagors. The Interim Servicer shall mail to the
Mortgagor of each related Mortgage Loan a letter advising
such Mortgagor of the transfer of the servicing of the
related Mortgage Loan to the Purchaser, or its designee, in
accordance with the ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ National Affordable
Housing Act of 1990; provided, however, that the content and
format of the letter shall have the prior approval of the
Purchaser. The Interim Servicer shall provide the Purchaser
with copies of all such related notices no later than the
related Transfer Date.
(B) Notice to Taxing Authorities and Insurance Companies. The
Interim Servicer shall transmit to the applicable taxing
authorities and insurance companies (including primary
mortgage insurance policy insurers, if applicable) and/or
agents, notification of the transfer of the servicing to the
Purchaser, or its designee, and instructions to deliver all
notices, tax bills and insurance statements, as the case may
be, to the Purchaser or its designee from and after the
related Transfer Date. The Interim Servicer shall provide
the Purchaser with copies of all such notices no later than
the related Transfer Date.
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(C) Delivery of Servicing Records. The Interim Servicer shall
forward to the Purchaser, or its designee, all servicing
records and the Servicing File in the Interim Servicer's
possession relating to each related Mortgage Loan.
(D) Escrow Payments. The Interim Servicer shall provide the
Purchaser, or its designee, with immediately available funds
by wire transfer an amount equal to the net Escrow Payments
and suspense balances and all loss draft balances associated
with the related Mortgage Loans. The Interim Servicer shall
provide the Purchaser with an accounting statement, in
electronic format acceptable to the Purchaser in its sole
discretion, of Escrow Payments and suspense balances and
loss draft balances sufficient to enable the Purchaser to
reconcile the amount of such payment with the accounts
related to the Mortgage Loans. Additionally, the Interim
Servicer shall wire transfer to the Purchaser the amount of
any agency, trustee or prepaid Mortgage Loan payments and
all other similar amounts held by the Interim Servicer.
(E) Payoffs and Assumptions. The Interim Servicer shall provide
to the Purchaser, or its designee, copies of all assumption
and payoff statements generated by the Interim Servicer on
the related Mortgage Loans from the related Cut-off Date to
the related Transfer Date.
(F) Mortgage Payments Received Prior to Transfer Date. Prior to
the related Transfer Date all payments received by the
Interim Servicer on each related Mortgage Loan shall be
properly applied by the Interim Servicer to the account of
each related Mortgagor.
(G) Mortgage Payments Received after Transfer Date. The amount
of any related Monthly Payments received by the Interim
Servicer after the related Transfer Date shall be forwarded
to the Purchaser by overnight mail on the date of receipt or
by wire transfer on the next succeeding Business Day. The
Interim Servicer shall notify the Purchaser of the
particulars of the payments, which notification requirement
shall be satisfied if the Interim Servicer forwards with its
payment sufficient information to permit appropriate
processing of the payment by the Purchaser. The Interim
Servicer shall assume full responsibility for the necessary
and appropriate legal application of such Monthly Payments
received by the Interim Servicer after the related Transfer
Date with respect to related Mortgage Loans then in
foreclosure or bankruptcy; provided, for purposes of this
Agreement, necessary and appropriate legal application of
such Monthly Payments shall include, but not be limited to,
endorsement of a Monthly Payment to the Purchaser with the
particulars of the payment such as the account number,
dollar amount, date received and any special Mortgagor
application instructions and the Interim Servicer shall
comply with the foregoing requirements with respect to all
Monthly Payments received by the Interim Servicer after the
related Transfer Date.
(H) Misapplied Payments. Misapplied payments shall be processed
as follows:
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1. All parties shall cooperate in correcting
misapplication errors;
2. The party receiving notice of a misapplied payment
occurring prior to the related Transfer Date and
discovered after such Transfer Date shall immediately
notify the other party;
3. If a misapplied payment which occurred prior to the
related Transfer Date cannot be identified and said
misapplied payment has resulted in a shortage in a
Custodial Account or Escrow Account, the Interim
Servicer shall be liable for the amount of such
shortage. The Interim Servicer shall reimburse the
Purchaser for the amount of such shortage within
thirty (30) days after receipt of written demand
therefor from the Purchaser;
4. If a misapplied payment which occurred prior to the
related Transfer Date caused the purchase price to be
incorrectly calculated as the result of an inaccurate
outstanding principal balance, a check shall be issued
to the party shorted by the improper payment
application within five (5) Business Days after notice
thereof by the other party; and
5. Any check issued under the provisions of this Section
2.21(H) shall be accompanied by a statement indicating
the corresponding Interim Servicer and/or the
Purchaser Mortgage Loan identification number and an
explanation of the allocation of any such payments.
(I) Books and Records. On the related Transfer Date, the books,
records and accounts of the Interim Servicer with respect to
the related Mortgage Loans shall be delivered in accordance
with all applicable Purchaser requirements.
(J) Reconciliation. The Interim Servicer shall, on or before the
related Transfer Date, reconcile principal balances and make
any monetary adjustments required by the Purchaser. Any such
monetary adjustments will be transferred between the Interim
Servicer and the Purchaser as appropriate.
(K) IRS Forms. The Interim Servicer shall or shall file all IRS
forms 1099, 1099A, 1098 or 1041 and K-1 which are required
to be filed on or before the related Transfer Date in
relation to the servicing and ownership of the related
Mortgage Loans. The Interim Servicer shall provide copies of
such forms to the Purchaser upon request and shall reimburse
the Purchaser for any costs or penalties incurred by the
Purchaser due to the Interim Servicer's failure to comply
with this paragraph.
Except as otherwise provided in this Agreement, on the related
Transfer Date for each Mortgage Loan, this Agreement, except for Articles VI,
VIII, IX and X which shall survive the related Transfer Date, shall terminate
with respect to such Mortgage Loan.
(b) Mortgage Loans in Foreclosure. The servicing with respect to
Mortgage Loans in foreclosure or in bankruptcy on or before the related
Transfer Date shall not be transferred from the Interim Servicer to the
Purchaser or the successor servicer, as the case may
23
be, and such Mortgage Loans shall continue to be serviced by the Interim
Servicer pursuant to the terms of this Agreement. However, if the Purchaser so
elects, the Purchaser may waive the provisions of this paragraph (b) and
accept transfer of servicing of such Mortgage Loans and all amounts received
by the Interim Servicer thereunder.
(c) Servicing Advances. Notwithstanding the fact that the related
Transfer Date has occurred, the Interim Servicer shall not be reimbursed for
any Servicing Advances in relation to any Mortgage Loan until the Interim
Servicer or the successor servicer receives a Monthly Payment, or Liquidation
Proceeds or any recoveries from the related Mortgagor or any other payments or
recoveries (including Insurance Proceeds and Condemnation Proceeds) in
relation to such Mortgage Loan. At such time, the Interim Servicer shall be
entitled to be reimbursed for all unreimbursed Servicing Advances with respect
to such Mortgage Loan on a first priority basis from any such payments or
recoveries received with respect to such Mortgage Loan. This Section 2.21(c)
shall survive each Transfer Date.
Section 2.22 Fair Credit Reporting Act.
For each Mortgage Loan, the Interim Servicer shall 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, or their successors, on a monthly basis. The
Interim Servicer shall provide evidence of such monthly reporting to the
Purchaser upon request.
ARTICLE III
PAYMENTS TO PURCHASER
Section 3.01 Remittances.
On each Remittance Date the Interim Servicer shall remit by wire
transfer of immediately available funds to the Purchaser (a) all amounts
deposited in the Custodial Account as of the close of business on the
Determination Date (net of charges against or withdrawals from the Custodial
Account pursuant to Section 2.05), plus (b) all amounts, if any, which the
Interim Servicer is obligated to distribute pursuant to Section 3.03, minus
(c) any amounts attributable to Principal Prepayments received after the
applicable Principal Prepayment Period which amounts shall be remitted on the
following Remittance Date, together with any additional interest required to
be deposited in the Custodial Account in connection with such Principal
Prepayment in accordance with Section 2.04(viii), and minus (d) any amounts
attributable to Monthly Payments collected but due on a Due Date or Dates
subsequent to the first day of the month of the Remittance Date, which amounts
shall be remitted on the Remittance Date next succeeding the Due Period for
such amounts.
With respect to any remittance received by the Purchaser after the
second Business Day following the Business Day on which such payment was due,
the Interim Servicer shall pay to the Purchaser interest on any such late
payment at an annual rate equal to the Prime Rate, adjusted as of the date of
each change, plus three percentage points, but in no event greater than the
maximum amount permitted by applicable law. Such interest shall be deposited
in the
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Custodial Account by the Interim Servicer on the date such late payment is
made and shall cover the period commencing with the day following such second
Business Day and ending with the Business Day on which such payment is made,
both inclusive. Such interest shall be remitted along with the distribution
payable on the next succeeding Remittance Date. The payment by the Interim
Servicer of any such interest shall not be deemed an extension of time for
payment or a waiver of any Event of Default by the Interim Servicer.
Section 3.02 Statements to Purchaser.
Not later than the 5th Business Day of each month (or if such 5th
day is not a Business Day, the Business Day next succeeding such 5th day), the
Interim Servicer shall furnish to the Purchaser in electronic form monthly
reports in the form of standard ALLTEL reports in "Microsoft Excel" format
with respect to the Mortgage Loans and the period from but including the first
day of the preceding calendar month through but excluding the first day of
such month.
In addition, the Interim Servicer shall provide each Purchaser
with such information as any Purchaser may reasonably request from time to
time concerning the Mortgage Loans as is necessary for such Purchaser to
prepare its federal income tax return and any and all other tax returns,
information statements or other filings required to be delivered to any
governmental taxing authority or to any Purchaser pursuant to any applicable
law with respect to the Mortgage Loans and the transactions contemplated
hereby.
Section 3.03 Advances by Interim Servicer.
Except as otherwise provided herein, the Interim Servicer shall be
entitled to first priority reimbursement pursuant to Section 2.05 hereof for
Servicing Advances from recoveries from the related Mortgagor or from all
Liquidation Proceeds and other payments or recoveries (including Insurance
Proceeds and Condemnation Proceeds) with respect to the related Mortgage Loan.
ARTICLE IV
GENERAL SERVICING PROCEDURES
Section 4.01 Transfers of Mortgaged Property.
The Interim Servicer shall use its best efforts to enforce any
"due-on-sale" provision contained in any Mortgage or Mortgage Note and to deny
assumption by the person to whom the Mortgaged Property has been or is about
to be sold whether by absolute conveyance or by contract of sale, and whether
or not the Mortgagor remains liable on the Mortgage and the Mortgage Note.
When the Mortgaged Property has been conveyed by the Mortgagor, the Interim
Servicer shall, 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, that the Interim
Servicer shall 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 PMI Policy, if any.
25
If the Interim Servicer reasonably believes it is unable under
applicable law to enforce such "due-on-sale" clause, the Interim Servicer
shall enter into (i) an assumption and modification agreement with the person
to whom such property has been conveyed, pursuant to which such person becomes
liable under the Mortgage Note and the original Mortgagor remains liable
thereon or (ii) in the event the Interim Servicer is unable under applicable
law to require that the original Mortgagor remain liable under the Mortgage
Note and the Interim Servicer has the prior consent of the primary mortgage
guaranty insurer, 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. If an assumption fee is
collected by the Interim Servicer for entering into an assumption agreement,
such fee will be retained by the Interim Servicer as additional servicing
compensation. In connection with any such assumption, neither the Mortgage
Interest Rate borne by the related Mortgage Note, the term of the Mortgage
Loan nor the outstanding principal amount of the Mortgage Loan shall be
changed.
To the extent that any Mortgage Loan is assumable, the Interim
Servicer shall inquire diligently into the creditworthiness of the proposed
transferee, and shall use the underwriting criteria for approving the credit
of the proposed transferee which are used by ▇▇▇▇▇▇ Mae with respect to
underwriting mortgage loans of the same type as the Mortgage Loan. If the
credit of the proposed transferee does not meet such underwriting criteria,
the Interim Servicer diligently shall, to the extent permitted by the Mortgage
or the Mortgage Note and by applicable law, accelerate the maturity of the
Mortgage Loan.
Section 4.02 Satisfaction of Mortgages and Release of Mortgage
Files.
Upon the payment in full of any Mortgage Loan, or the receipt by
the Interim Servicer of a notification that payment in full will be escrowed
in a manner customary for such purposes, the Interim Servicer shall notify the
Purchaser in the monthly reports as provided in Section 3.02, and may request
the release of any Mortgage Loan Documents. In connection with any such
prepayment in full, the Interim Servicer shall comply with all applicable laws
regarding satisfaction, release or reconveyance with respect to the Mortgage.
If the Interim Servicer satisfies or releases a Mortgage without
first having obtained payment in full of the indebtedness secured by the
Mortgage or should the Interim Servicer otherwise prejudice any rights the
Purchaser may have under the mortgage instruments, upon written demand of the
Purchaser, the Interim Servicer shall repurchase the related Mortgage Loan at
the Repurchase Price by deposit thereof in the Custodial Account within 2
Business Days of receipt of such demand by the Purchaser. The Interim Servicer
shall maintain the Fidelity Bond and Errors and Omissions Insurance Policy as
provided for in Section 2.12 insuring the Interim Servicer against any loss it
may sustain with respect to any Mortgage Loan not satisfied in accordance with
the procedures set forth herein.
Section 4.03 Servicing Compensation.
As compensation for its services hereunder, the Interim Servicer
shall be entitled to withdraw from the Custodial Account or to retain from
interest payments on the Mortgage Loans the amount of its Servicing Fee. The
Servicing Fee shall be payable monthly and shall be
26
computed on the basis of the same unpaid principal balance and for the period
respecting which any related interest payment on a Mortgage Loan is computed.
The Servicing Fee shall be pro rated for any portion of a month during which
the Mortgage Loan is serviced pursuant to this Agreement. In addition, the
Servicing Fee shall be payable only at the time of and with respect to those
Mortgage Loans for which payment is in fact made of the entire amount of the
Monthly Payment. The obligation of the Purchaser to pay the Servicing Fee is
limited to, and payable solely from, the interest portion of such Monthly
Payments collected by the Interim Servicer. The Interim Servicer recognizes
that to the extent it does not recover all accrued but unpaid Servicing Fees
under Section 4.03, the Purchaser shall not have any liability with respect to
such shortfalls.
Additional servicing compensation in the form of assumption fees
and Ancillary Income shall be retained by the Interim Servicer to the extent
not required to be deposited in the Custodial Account. The Interim Servicer
shall be required to pay all expenses incurred by it in connection with its
servicing activities hereunder and shall not be entitled to reimbursement
thereof except as specifically provided for herein.
Section 4.04 Annual Statement as to Compliance.
The Interim Servicer shall deliver to the Purchaser, on or prior
to March 1st of each year beginning March 1, 2006, and on the first Transfer
Date, an Officer's Certificate, stating that (i) a review of the activities of
the Interim Servicer during the preceding calendar year and of performance
under this Agreement has been made under such officer's supervision, and (ii)
the Interim Servicer has complied fully with the provisions of this Agreement,
and (iii) to the best of such officer's knowledge, based on such review, the
Interim Servicer has fulfilled all 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 and the action being taken by the Interim
Servicer to cure such default.
Section 4.05 Annual Independent Public Accountants' Servicing
Report.
On or before March 1st of each year beginning March 1, 2006, the
Interim Servicer, at its expense, shall cause a firm of independent public
accountants which is a member of the American Institute of Certified Public
Accountants to furnish a statement to each Purchaser to the effect that such
firm has examined certain documents and records relating to the servicing of
the Mortgage Loans and this Agreement and that such firm is of the opinion
that the provisions of this Agreement have been complied with, and that, on
the basis of such examination conducted substantially in compliance with the
Uniform Single Attestation Program for Mortgage Bankers, nothing has come to
their attention which would indicate that such servicing has not been
conducted in compliance therewith, except for (i) such exceptions as such firm
shall believe to be immaterial, and (ii) such other exceptions as shall be set
forth in such statement.
Section 4.06 Right to Examine Interim Servicer Records.
The Purchaser shall have the right to examine and audit any and
all of the books, records, or other information of the Interim Servicer,
whether held by the Interim Servicer or by
27
another on its behalf, with respect to or concerning this Agreement or the
Mortgage Loans, during business hours or at such other times as may be
reasonable under applicable circumstances, upon reasonable advance notice.
Section 4.07 Books and Records
The Interim Servicer shall maintain with respect to each Mortgage
Loan, and shall make available for inspection by any Purchaser or its
designee, the related Servicing File during the time the Purchaser retains
ownership of a Mortgage Loan governed by this Agreement and thereafter in
accordance with applicable laws and regulations.
The Interim Servicer shall keep at its servicing office books and
records in which, subject to such reasonable regulations as it may prescribe,
the Interim Servicer shall note transfers of Mortgage Loans. For the purposes
of this Agreement, the Interim Servicer shall be under no obligation to deal
with any person with respect to this Agreement or the Mortgage Loans unless
the books and records show such person as the owner of the Mortgage Loan. The
Purchaser may sell and transfer one or more of the Mortgage Loans, provided,
however, with respect to each Mortgage Loan Package (excluding any delinquent
Mortgage Loans), in no event shall there be more than six Persons, unless
otherwise set forth in the Purchase Price and Terms Agreement or the related
Assignment and Conveyance, at any given time having the status of "Purchaser"
hereunder. The Purchaser also shall advise the Interim Servicer of the
transfer. Upon receipt of notice of the transfer, the Interim Servicer shall
▇▇▇▇ its books and records to reflect the ownership of the Mortgage Loans of
such assignee, and shall release the previous Purchaser from its obligations
hereunder with respect to the Mortgage Loans sold or transferred.
Section 4.08 Delivery of Documents
The Interim Servicer shall forward to the Custodian original
documents evidencing an assumption, modification, consolidation or extension
of any Mortgage Loan entered into in accordance with Section 2.01 or 4.01
within one week of their execution, provided, however, that the Interim
Servicer shall provide the Custodian with a certified true copy of any such
document submitted for recordation within one week of its execution, 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 within sixty days of its submission for
recordation.
Section 4.09 Compliance with ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act of 1999.
With respect to each Mortgage Loan and the related Mortgagor, the
Interim Servicer shall comply with Title V of the ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act of
1999 and all applicable regulations promulgated thereunder, and shall provide
all notices required thereunder.
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ARTICLE V
REPRESENTATIONS AND WARRANTIES;
REMEDIES AND BREACH
Section 5.01 Interim Servicer Representations and Warranties.
The Interim Servicer represents and warrants to the Purchaser that
as of the related Closing Date or as of such date specifically provided
herein:
(a) Due Organization and Authority. The Interim Servicer is a
federal savings association, validly existing, and in good standing under the
laws of its jurisdiction of organization or formation and has all licenses
necessary to carry on its business as now being conducted and is licensed,
qualified and in good standing in the states where the Mortgaged Property is
located if the laws of such state require licensing or qualification in order
to conduct business of the type conducted by the Interim Servicer. The Interim
Servicer has corporate power and authority to execute and deliver this
Agreement and to perform its obligations hereunder; the execution, delivery
and performance of this Agreement by the Interim Servicer and the consummation
of the transactions contemplated hereby have been duly and validly authorized;
this Agreement has been duly executed and delivered and constitutes the valid,
legal, binding and enforceable obligation of the Interim Servicer, 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 the Interim Servicer to make this
Agreement valid and binding upon the Interim Servicer in accordance with its
terms;
(b) No Consent Required. 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 the Interim Servicer is required or, if required,
such consent, approval, authorization or order has been or will, prior to the
related Closing Date, be obtained;
(c) Ordinary Course of Business. The consummation of the
transactions contemplated by this Agreement are in the ordinary course of
business of the Interim Servicer.
(d) No Conflicts. Neither the execution and delivery of this
Agreement, the consummation of the transactions contemplated hereby, nor the
fulfillment of or compliance with the terms and conditions of this Agreement,
will conflict with or result in a breach of any of the terms, conditions or
provisions of the Interim Servicer's charter or by-laws or any legal
restriction or any agreement or instrument to which the Interim Servicer is
now a party or by which it is bound, or constitute a default or result in an
acceleration under any of the foregoing, or result in the violation of any
law, rule, regulation, order, judgment or decree to which the Interim Servicer
or its property is subject, or result in the creation or imposition of any
lien, charge or encumbrance that would have an adverse effect upon any of its
properties pursuant to the terms of any mortgage, contract, deed of trust or
other instrument, or impair the ability of the Purchaser to realize on the
Mortgage Loans, impair the value of the Mortgage Loans, or impair
29
the ability of the Purchaser to realize the full amount of any insurance
benefits accruing pursuant to this Agreement;
(e) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or threatened against the Interim Servicer, before any
court, administrative agency or other tribunal asserting the invalidity of
this Agreement, seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or which, either in any one instance or in the
aggregate, may result in any material adverse change in the business,
operations, financial condition, properties or assets of the Interim Servicer,
or in any material impairment of the right or ability of the Interim Servicer
to carry on its business substantially as now conducted, or in any material
liability on the part of the Interim Servicer, 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 the Interim
Servicer contemplated herein, or which would be likely to impair materially
the ability of the Interim Servicer to perform under the terms of this
Agreement;
(f) Ability to Perform. The Interim Servicer 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;
(g) Anti-Money Laundering Laws. The Interim Servicer has complied
with all applicable anti-money laundering laws and regulations, including
without limitation the USA Patriot Act of 2001 (collectively, the "Anti-Money
Laundering Laws"); the Interim Servicer has established an anti-money
laundering compliance program as required by the Anti-Money Laundering Laws,
has conducted the requisite due diligence in connection with the origination
of each Mortgage Loan for purposes of the Anti-Money Laundering Laws,
including with respect to the legitimacy of the applicable Mortgagor and the
origin of the assets used by the said Mortgagor to purchase the property in
question, and maintains, and will maintain, sufficient information to identify
the applicable Mortgagor for purposes of the Anti-Money Laundering Laws;
(h) Financial Statements. The Interim Servicer has delivered to
the Purchaser financial statements as to its last three complete fiscal years
and any later quarter ended more than 60 days prior to the execution of this
Agreement. All such financial statements fairly present the pertinent results
of operations and changes in financial position for each of such periods and
the financial position at the end of each such period of the Interim Servicer
and its subsidiaries and have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the periods
involved, except as set forth in the notes thereto. In addition, the Interim
Servicer has delivered information as to its loan gain and loss experience in
respect of foreclosures and its loan delinquency experience for the
immediately preceding three-year period, in each case with respect to mortgage
loans owned by it and such mortgage loans serviced for others during such
period, and all such information so delivered shall be true and correct in all
material respects. There has been no change in the business, operations,
financial condition, properties or assets of the Interim Servicer since the
date of the Interim Servicer's financial statements that would have a material
adverse effect on its ability to perform its obligations under this Agreement.
The Interim Servicer has completed any forms requested by the Purchaser in a
timely manner and in accordance with the provided instructions;
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(i) Ability to Service. The Interim Servicer is an approved
Interim Servicer of conventional residential mortgage loans for ▇▇▇▇▇▇ Mae or
▇▇▇▇▇▇▇ Mac, with the facilities, procedures, and experienced personnel
necessary for the sound servicing of mortgage loans of the same type as the
Mortgage Loans. The Interim Servicer is in good standing to service mortgage
loans for ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, and no event has occurred, including but
not limited to a change in insurance coverage, which would make the Interim
Servicer unable to comply with ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac eligibility
requirements or which would require notification to either ▇▇▇▇▇▇ Mae or
▇▇▇▇▇▇▇ Mac;
(j) Reasonable Servicing Fee. The Interim Servicer acknowledges
and agrees that the Servicing Fee, represents reasonable compensation for
performing such services and that the entire Servicing Fee shall be treated by
the Interim Servicer, for accounting and tax purposes, as compensation for the
servicing and administration of the Mortgage Loans pursuant to this Agreement.
(k) No Untrue Information. Neither this Agreement nor any
statement, report or other document furnished or to be furnished pursuant to
this Agreement or any Reconstitution Agreement or in connection with the
transactions contemplated hereby including any Securitization Transfer or
Whole Loan Transfer contains any untrue statement of fact or omits to state a
fact necessary to make the statements contained therein not misleading;
ARTICLE VI
AGENCY TRANSFER; SECURITIZATION TRANSFER
Section 6.01 Removal of Mortgage Loans from Inclusion Under this
Agreement Upon an Agency Transfer, Whole-Loan Transfer or a Securitization
Transfer on One or More Reconstitution Dates.
The Purchaser and the Interim Servicer agree that with respect to
some or all of the Mortgage Loans, from time to time, the Purchaser may:
(1) Effect an Agency Transfer, and/or
(2) Effect a Whole Loan Transfer, and/or
(3) Effect a Securitization Transfer,
(each a "Sale") in each case retaining the Interim Servicer as the servicer
thereof, or as applicable the "seller/servicer."
Unless otherwise agreed to between the Purchaser and the Interim
Servicer, the Purchaser shall give the Interim Servicer 15 days notice of any
Sale. The Interim Servicer shall cooperate with the Purchaser in connection
with each Sale in accordance with this Section 6.01. In connection therewith
the Interim Servicer shall:
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(a) cooperate fully with the Purchaser and any prospective
purchaser with respect to all reasonable requests and due diligence
procedures;
(b) make all representations and warranties with respect to
the Mortgage Loans as of the earlier of the Transfer Date and the related
Closing Date as applicable and with respect to the Interim Servicer itself as
of the earlier of the Transfer Date and the closing date of each Sale;
(c) negotiate in good faith and execute any Reconstitution
Agreements required by Purchaser to effectuate the foregoing provided such
agreements create no greater obligation or cost on the part of the Interim
Servicer than otherwise set forth in this Agreement;
(d) represent to the Purchaser, the depositor, the trustee,
and the initial purchaser of the securities issued in connection with any Sale
that: (1) that the Interim Servicer has serviced the Mortgage Loans on an
"actual/actual" basis in accordance with the terms of this Agreement, and has
otherwise complied with all covenants and obligations hereunder, and (2) that
the Interim Servicer has taken no action that would, nor omitted to take any
required action the omission of which would, have the effect of impairing the
mortgage insurance or guarantee on the Mortgage Loans. The Interim Servicer
also agrees to represent the accuracy of any information provided to the
Purchaser by the Interim Servicer for inclusion in any prospectus supplement,
offering memorandum or term sheet prepare in connection with any Sale;
(e) deliver an opinion of counsel (which can be an opinion
of in-house counsel to the Interim Servicer) reasonably acceptable to the
Purchaser; provided that any out-of-pocket, third party expenses incurred by
the Interim Servicer in connection with the foregoing shall be paid by the
Purchaser; and
(f) provide as applicable:
(i) any and all information and appropriate
verification of information which may be reasonably available to the
Interim Servicer, whether through letters of its auditors and counsel or
otherwise, as the Purchaser shall request;
(ii) (x) the Annual Certification executed by a senior
officer of the Interim Servicer responsible for the servicing of the
Mortgage Loans; and (y) such additional statements, certificates or
other similar documents of the Interim Servicer or reports from the
Interim Servicer's accountants in connection with a Securitization
Transfer and in substance as required by applicable law; and
(iii) such additional representations, warranties,
covenants, opinions of counsel, letters from auditors, financial
description of the Interim Servicer as servicer for inclusion in any
offering memorandum to be distributed to potential investors in
connection with a Sale with respect to the Mortgage Loans, and
certificates of public officials or officers of the Interim Servicer as
are reasonably believed necessary by the trustee, any Rating Agency, the
Purchaser, as the case may be, in connection with such Sale. The
Purchaser shall pay all third party costs associated with the
preparation of such information. The Interim
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Servicer shall execute any Reconstitution Agreements required within a
reasonable period of time after receipt of such Reconstitution
Agreements which time shall be sufficient for the Interim Servicer and
it's counsel to review such Reconstitution Agreements. Under this
Agreement, the Interim Servicer shall retain a servicing fee at a rate
per annum equal to no less than 0.25% per Mortgage Loan.
The Interim Servicer shall indemnify the Purchaser, each affiliate
designated by the Purchaser and each Person who controls the Purchaser or such
affiliate and each underwriter or placement agent participating in any sale
and hold each of them harmless from and against any losses, damages,
liabilities, penalties, fines, forfeitures, reasonable and necessary legal
fees and related costs, judgments, and any other costs, fees and expenses that
each of them may sustain in any way related to any false statements or
omissions or alleged or true statement or omission with respect to information
provided by or on behalf of the Interim Servicer regarding the Interim
Servicer, the Interim Servicer's servicing practices or performance, the
Mortgage Loans or the Underwriting Guidelines set forth in any offering
document prepared in connection with any Reconstitution. If such
indemnification is not available, the Interim Servicer shall contribute to
such losses, damages, liabilities, penalties, fines, forfeitures, reasonable
and necessary legal fees and related costs, judgments, and any other costs,
fees and expenses in proportion to the Interim Servicer's relative benefit and
fault, in which case the relative benefit for the Interim Servicer, and the
persons related thereto, will be measured relative to the Purchase Price and
the relative benefit of the Purchaser and the persons related thereto, will be
measured relative to the underwriting discount received in connection with the
Whole Loan Transfer and/or Securitization Transfer. But, in no event shall the
Interim Servicer be obligated to any greater extent under a Reconstitution
Agreement than it is under this Agreement. For purposes of this section,
"Purchaser" shall mean the Person then acting as the Purchaser under this
Agreement and any and all Persons who previously were defined "Purchasers"
under this Agreement.
In the event the Purchaser has elected to have the Interim
Servicer hold record title to the Mortgages, prior to a Reconstitution Date
the Interim Servicer or its designee shall prepare an Assignment of Mortgage
in blank from the Interim Servicer, acceptable to ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, the
trustee or such third party, as the case may be, for each Mortgage Loan that
is part of a Sale and shall pay all preparation and recording costs associated
therewith. The Interim Servicer shall execute each Assignment of Mortgage,
track such Assignments of Mortgage to ensure they have been recorded and
deliver them as required by ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, the trustee or such third
party, as the case may be, upon the Interim Servicer's receipt thereof.
Additionally, the Interim Servicer shall prepare and execute, at the direction
of the Purchaser, any note endorsements in connection with any and all
Reconstitution Agreements.
All Mortgage Loans purchased on a servicing released basis by the
Purchaser and not sold or transferred pursuant to a Sale and any Mortgage
Loans and repurchased by the Purchaser pursuant to the Purchase Agreement,
shall be subject to this Agreement and shall continue to be serviced in
accordance with the terms of this Agreement and with respect thereto this
Agreement shall remain in full force and effect.
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Unless otherwise agreed to between the Interim Servicer and the
Purchaser, with respect to any Mortgage Loan Package, the Interim Servicer
will not be obligated to enter into any Reconstitution Agreement in connection
with a Securitization Transfer or Agency Transfer in excess of any express
restrictions set forth in the related Assignment and Conveyance and related
Purchase Price and Terms Agreement.
With respect to any Mortgage Loans sold in a Securitization
Transfer where the Interim Servicer is the servicer, the Interim Servicer
agrees that on or before March 1st each year beginning the calendar year after
the related Securitization Transfer occurs, to deliver to the depositor and
the trustee, and their officers, directors and affiliates, a certification in
the form attached as Exhibit M hereto, executed by the senior officer in
charge of servicing at the Interim Servicer for use in connection with any
Form 10-K to be filed with the Securities and Exchange Commission with respect
to the securitization trust. The obligation to provide such certification will
terminate to the extent the securitization trust's obligation to file reports
under the Securities Exchange Act of 1934, as amended, terminates. The Interim
Servicer shall indemnify and hold harmless the depositor, the trustee and
their respective officers, directors and affiliates from and against any
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal
fees and related costs, judgments and other costs and expenses arising out of
or based upon any breach of the Interim Servicer's obligations under this
paragraph or the Interim Servicer's material misstatement or omission, bad
faith or willful misconduct in connection therewith. If the indemnification
provided for herein is unavailable or insufficient to hold harmless the
indemnified party, then the Interim Servicer agrees that it shall contribute
to the amount paid or payable by the depositor and/or the trustee as a result
of the losses, claims, damages or liabilities of the depositor and/or the
trustee in such proportion as is appropriate to reflect the relative fault of
the depositor or the trustee, as the case may be, on the one hand and the
Interim Servicer on the other in connection with a breach of the Interim
Servicer's obligations under this paragraph or the Interim Servicer's
negligence, bad faith or willful misconduct in connection therewith.
Notwithstanding any provisions of this Agreement to the contrary,
all Mortgage Loans sold or transferred to ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac shall be
serviced in accordance with the Servicing Guides, as the same may be amended
from time to time. The Interim Servicer further agrees that it will service
the related Mortgage Loans in accordance with the terms of any ▇▇▇▇▇▇ Mae or
▇▇▇▇▇▇▇ Mac requirements which are in addition to those set forth in the
Servicing Guides. The Interim Servicer acknowledges that the Purchaser may
from to time sell or transfer certain of the Mortgage Loans to ▇▇▇▇▇▇ Mae and/
or ▇▇▇▇▇▇▇ Mac or deliver certain securities secured by the Mortgage Loans to
▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac to be guaranteed. In the event such sale or delivery
occurs, the Interim Servicer agrees that it shall deliver to ▇▇▇▇▇▇ Mae,
▇▇▇▇▇▇▇ Mac, FHA, or VA, as applicable, all reports, certificates, and other
documentation required by each such agency and that it shall remit to ▇▇▇▇▇▇
Mae or ▇▇▇▇▇▇▇ Mac, as applicable, all amounts required to be remitted in
accordance such agency's guaranty program. The Purchaser and the Interim
Servicer agree that any Mortgage Loans sold by the Purchaser to ▇▇▇▇▇▇ Mae,
will be managed in accordance with the Process Guidelines set forth in Exhibit
G hereto. The Interim Servicer acknowledges that the requirements of the
Process Guidelines are in addition to the Interim Servicer's obligations to
service the Loans in accordance with the Servicing Guides and Accepted
Servicing Practices. All Mortgage Loans not sold or transferred pursuant to
Whole Loan Transfers or Securitization Transfers shall remain subject to this
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Agreement and shall continue to be serviced in accordance with the terms of
this Agreement and with respect thereto this Agreement shall remain in full
force and effect.
ARTICLE VII
INTERIM SERVICER TO COOPERATE
Section 7.01 Provision of Information.
During the term of this Agreement, the Interim Servicer shall
furnish to the Purchaser such periodic, special, or other reports or
information and copies or originals of any documents contained in the
Servicing File for each Mortgage Loan, whether or not provided for herein, as
shall be necessary, reasonable, or appropriate with respect to the Purchaser,
any regulatory requirement pertaining to the Purchaser or the purposes of this
Agreement. All such reports, documents or information shall be provided by and
in accordance with all reasonable instructions and directions which the
Purchaser may give. Any special reports or information delivered shall be at
the Purchaser's expense.
The Interim Servicer shall execute and deliver all such
instruments and take all such action as the Purchaser may reasonably request
from time to time, in order to effectuate the purposes and to carry out the
terms of this Agreement.
Section 7.02 Financial Statements; Servicing Facility.
In connection with marketing the Mortgage Loans, the Purchaser may
make available to a prospective Purchaser a Consolidated Statement of
Operations of the Interim Servicer for the most recently completed five fiscal
years for which such a statement is available, as well as a Consolidated
Statement of Condition at the end of the last two fiscal years covered by such
Consolidated Statement of Operations. Purchaser shall not make such statement
available to any prospective Purchaser unless such prospective Purchaser has
signed a confidentiality agreement with respect to the information provided
with respect to Interim Servicer unless already publicly available. The
Interim Servicer also shall make available any comparable interim statements
to the extent any such statements have been prepared by or on behalf of the
Interim Servicer (and are available upon request to members or stockholders of
the Interim Servicer or to the public at large). If it has not already done
so, the Interim Servicer shall furnish promptly to the Purchaser copies of the
statement specified above.
The Interim Servicer also shall make available to Purchaser or
prospective Purchaser a knowledgeable financial or accounting officer for the
purpose of answering questions respecting recent developments affecting the
Interim Servicer or the financial statements of the Interim Servicer, and to
permit any prospective Purchaser to inspect the Interim Servicer's servicing
facilities for the purpose of satisfying such prospective Purchaser that the
Interim Servicer have the ability to service the Mortgage Loans as provided in
this Agreement.
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ARTICLE VIII
THE INTERIM SERVICER
Section 8.01 Indemnification; Third Party Claims.
(a) Breaches of Representations and Warranties. The Interim
Servicer agrees to indemnify the Purchaser and any successor servicer and each
of their present and former officers, directors, representatives, agents and
affiliates and hold them harmless from and against any and all claims, losses,
damages, penalties, fines, forfeitures, legal fees and related costs,
judgments, and any other costs, fees and expenses that the Purchaser may
sustain in any way related to any assertion based on, grounded upon or
resulting from a breach of any of the Interim Servicer's representations,
warranties or covenants contained herein. The Interim Servicer shall
immediately notify the Purchaser if a claim is made by a third party with
respect to this Agreement or the Mortgage Loans, assume (with the consent of
the Purchaser and with counsel reasonably satisfactory to the Purchaser) the
defense of any such claim and pay all expenses in connection therewith,
including counsel fees, and promptly pay, discharge and satisfy any judgment
or decree which may be entered against it or the Purchaser in respect of such
claim but failure to so notify the Purchaser shall not limit its obligations
hereunder. The Interim Servicer agrees that it will not enter into any
settlement of any such claim without the consent of the Purchaser unless such
settlement includes an unconditional release of the Purchaser from all
liability that is the subject matter of such claim. In addition to the
obligations of the Interim Servicer set forth in this Section 8.01(a), the
Purchaser may pursue any and all remedies otherwise available at law or in
equity, including, but not limited to, the right to seek damages. The
provisions of this Section 89.01(a) shall survive any Sale of the Mortgage
Loans or termination of this Agreement.
(b) Interim Servicing. The Interim Servicer shall indemnify the
Purchaser and any successor servicer and each of their present and former
officers, directors, representatives, agents and affiliates and hold them
harmless against any and all claims, losses, damages, penalties, fines, and
forfeitures, including, but not limited to reasonable and necessary legal fees
and related costs, judgments, and any other costs, fees and expenses that the
Purchaser may sustain in any way related to the failure of the Interim
Servicer to (a) perform its duties, obligations, covenants, agreements,
warranties or representations contained in this agreement or service the
Mortgage Loans in strict compliance with the terms of this Agreement or any
Reconstitution Agreement entered into pursuant to Section 6.01, (b) comply
with applicable law or (c) cooperate fully with the Purchaser in effecting any
transfer of Servicing. The Interim Servicer immediately shall notify the
Purchaser if a claim is made by a third party with respect to this Agreement
or any Reconstitution Agreement or the Mortgage Loans, shall promptly notify
▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ Mac, or the trustee with respect to any claim made by a
third party with respect to any Reconstitution Agreement, assume (with the
prior written consent of the Purchaser) the defense of any such claim and pay
all expenses in connection therewith, including counsel fees, and promptly
pay, discharge and satisfy any judgment or decree which may be entered against
it or the Purchaser in respect of such claim. The Interim Servicer shall
follow any written instructions received from the Purchaser in connection with
such claim. The Purchaser promptly shall reimburse the Interim Servicer for
all amounts advanced by it pursuant to the preceding sentence except when the
claim is in any way related to the failure of the Interim
36
Servicer to (a) service and administer the Mortgage Loans in strict compliance
with the terms of this Agreement or any Reconstitution Agreement, and/or (b)
comply with applicable law.
For purposes of this Section 8.01, "Purchaser" shall mean the
Person then acting as the Purchaser under this Agreement and any and all
Persons who previously were Purchasers under this Agreement.
Section 8.02 Merger or Consolidation of the Interim Servicer.
The Interim Servicer shall keep in full effect its existence,
rights and franchises as a federally chartered thrift institution, and shall
obtain and preserve its qualification to do business as a federally chartered
thrift institution in each jurisdiction in which such qualification is or
shall be necessary to protect the validity and enforceability of this
Agreement or any of the Mortgage Loans and to perform its duties under this
Agreement.
Any person into which the Interim Servicer may be merged or
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Interim Servicer shall be a party, or any Person
succeeding to the business of the Interim Servicer, shall be the successor of
the Interim Servicer hereunder, without the execution or filing of any paper
or any further act on the part of any of the parties hereto, anything herein
to the contrary notwithstanding, provided, however, that in the event that
such successor servicer is not acceptable to the Purchaser in its sole
discretion, the Purchaser shall have the right to terminate the successor
servicer's rights under this servicing agreement without payment of any
Termination Fee.
Section 8.03 Limitation on Liability of Interim Servicer and
Others.
Neither the Interim Servicer nor any of the directors, officers,
employees or agents of the Interim Servicer shall be under any liability to
the Purchaser for any action taken or for refraining from the taking of any
action in good faith pursuant to this Agreement, or for errors in judgment,
provided, however, that this provision shall not protect the Interim Servicer
or any such person against any Breach of warranties or representations made
herein, or failure to perform its obligations in strict compliance with any
standard of care set forth in this Agreement, or any liability which would
otherwise be imposed by reason of any breach of the terms and conditions of
this Agreement. Nothing in this provision shall protect the Interim Servicer
against any liability that would otherwise be imposed by reason of the willful
misfeasance, bad faith or negligence in the performance of duties or by reason
of reckless disregard of the obligations or duties hereunder. The Interim
Servicer and any director, officer, employee or agent of the Interim Servicer
may rely in good faith on any document of any kind prima facie properly
executed and submitted by any Person respecting any matters arising hereunder.
The Interim Servicer shall not be under any obligation to appear in, prosecute
or defend any legal action which is not incidental to its duties to service
the Mortgage Loans in accordance with this Agreement and which in its opinion
may involve it in any expense or liability, provided, however, that the
Interim Servicer may, with the consent of the Purchaser, undertake any such
action which it may deem necessary or desirable in respect to this Agreement
and the rights and duties of the parties hereto. In such event, the Interim
Servicer shall be entitled to reimbursement from the Purchaser of the
reasonable legal expenses and costs of such action
37
except when such expenses and costs are subject to the Interim Servicer's
indemnification under this Agreement.
Section 8.04 Limitation on Resignation and Assignment by Interim
Servicer.
The Purchaser has entered into this Agreement with the Interim
Servicer and subsequent Purchasers will purchase the Mortgage Loans in
reliance upon the independent status of the Interim Servicer, and the
representations as to the adequacy of its servicing facilities, plant,
personnel, records and procedures, its integrity, reputation and financial
standing, and the continuance thereof. Therefore, the Interim Servicer shall
neither assign this Agreement or the servicing hereunder or delegate its
rights or duties hereunder or any portion hereof or sell or otherwise dispose
of all or substantially all of its property or assets without the prior
written consent of the Purchaser, which consent shall not be unreasonably
withheld.
The Interim Servicer shall not resign from the obligations and
duties hereby imposed on it except by mutual consent of the Interim Servicer
and the Purchaser or upon the determination that its duties hereunder are no
longer permissible under applicable law and such incapacity cannot be cured by
the Interim Servicer. Any such determination permitting the resignation of the
Interim Servicer shall be evidenced by an Opinion of Counsel to such effect
delivered to the Purchaser which Opinion of Counsel shall be in form and
substance acceptable to the Purchaser. No such resignation shall become
effective until a successor shall have assumed the Interim Servicer's
responsibilities and obligations hereunder in the manner provided in Section
11.01.
Without in any way limiting the generality of this Section 8.04,
in the event that the Interim Servicer either shall assign this Agreement or
the servicing responsibilities hereunder or delegate its duties hereunder or
any portion thereof or sell or otherwise dispose of all or substantially all
of its property or assets, without the prior written consent of the Purchaser,
then the Purchaser shall have the right to terminate this Agreement upon
notice given as set forth in Section 9.01, without any payment of any penalty
or damages and without any liability whatsoever to the Interim Servicer or any
third party.
ARTICLE IX
DEFAULT
Section 9.01 Events of Default.
Each of the following shall constitute an Event of Default on the
part of the Interim Servicer:
(i) any failure by the Interim Servicer to remit to the Purchaser
any payment required to be made under the terms of this Agreement or in
the Custodial Agreement which continues unremedied for a period of two
days after the date upon which written notice of such failure, requiring
the same to be remedied, shall have been given to the Interim Servicer
by the Purchaser; or
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(ii) failure by the Interim Servicer duly to observe or perform in
any material respect any other of the covenants, obligations or
agreements on the part of the Interim Servicer set forth in this
Agreement which continues unremedied for a period of 30 days after the
date on which written notice of such failure, requiring the same to be
remedied, shall have been given to the Interim Servicer by the
Purchaser; or
(iii) failure by the Interim Servicer to maintain its license to
do business in any jurisdiction where the Mortgage Property is located;
or
(iv) 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, readjustment of debt,
including bankruptcy, marshaling of assets and liabilities or similar
proceedings, or for the winding-up or liquidation of its affairs, shall
have been entered against the Interim Servicer and such decree or order
shall have remained in force undischarged or unstayed for a period of 60
days; or
(v) the Interim Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, bankruptcy,
readjustment of debt, marshaling of assets and liabilities or similar
proceedings of or relating to the Interim Servicer or of or relating to
all or substantially all of its property; or
(vi) the Interim Servicer shall admit in writing its inability to
pay its debts generally as they become due, file a petition to take
advantage of any applicable insolvency, bankruptcy or reorganization
statute, make an assignment for the benefit of its creditors,
voluntarily suspend payment of its obligations or cease its normal
business operations for three Business Days; or
(vii) the Interim Servicer ceases to meet the qualifications of a
▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ Mac, GNMA or VA servicer, as applicable; or
(viii) the Interim Servicer fails to maintain a minimum net worth
of $25,000,000; or
(ix) the Interim Servicer fails to maintain any required license
to do business or to service residential mortgage loans in any
jurisdiction where the Mortgaged Properties are located; or
(x) the Interim Servicer attempts to assign its right to servicing
compensation hereunder or the Interim Servicer attempts, without the
consent of the Purchaser, to sell or otherwise dispose of all or
substantially all of its property or assets or to assign this Agreement
or the servicing responsibilities hereunder or to delegate its duties
hereunder or any portion thereof in violation of Section 8.04.
If the Interim Servicer obtains knowledge of an Event of Default,
the Interim Servicer shall notify the Purchaser. In each and every such case,
so long as an Event of Default shall not have been remedied, in addition to
whatsoever rights the Purchaser may have at law or equity to damages,
including injunctive relief and specific performance, the Purchaser, by notice
39
in writing to the Interim Servicer, may terminate all the rights and
obligations of the Interim Servicer under this Agreement and in and to the
Mortgage Loans and the proceeds thereof.
Upon receipt by the Interim Servicer of such written notice, all
authority and power of the Interim Servicer 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 10.01. Upon written request from any
Purchaser, the Interim Servicer shall prepare, execute and deliver to the
successor entity designated by the Purchaser 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, at the Interim Servicer's sole expense. The Interim
Servicer shall cooperate with the Purchaser and such successor in effecting
the termination of the Interim Servicer's responsibilities and rights
hereunder, including without limitation, the transfer to such successor for
administration by it of all cash amounts which shall at the time be credited
by the Interim Servicer to the Custodial Account or Escrow Account or
thereafter received with respect to the Mortgage Loans.
Section 9.02 Waiver of Defaults.
By a written notice, the Purchaser may waive any default by the
Interim Servicer 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 thereon except
to the extent expressly so waived.
ARTICLE X
TERMINATION
Section 10.01 Termination.
This Agreement shall terminate upon either: (i) such Transfer Date
as the Purchaser shall inform the Interim Servicer by providing written notice
to the Interim Servicer at least 30 days prior to the related Transfer Date of
its intent to transfer the servicing of the related Mortgage Loans from the
Interim Servicer on the related Transfer Date, provided that, in any event,
the Interim Servicer shall be given timely notice to allow the Interim
Servicer to notify the related mortgagors of the transfer of servicing in
accordance with the requirements of the RESPA and the ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
National Affordable Housing Act of 1990, as amended, and provided further
that, the Transfer Date with respect to a Mortgage Loan shall be no later than
6 months, unless otherwise agreed to by both parties from and after the
related Closing Date, unless otherwise agreed upon by the Purchaser and the
Interim Servicer; or (ii) mutual consent of the Interim Servicer and the
Purchaser in writing. Upon written request from the Purchaser in connection
with any such termination, the Interim Servicer shall prepare, execute and
deliver, any and all documents and other instruments, place in the Purchaser's
possession all Mortgage
40
Files, and do or accomplish all other acts or things necessary or appropriate
to effect the purposes of such notice of termination, whether to complete the
transfer and endorsement or assignment of the Mortgage Loans and related
documents, or otherwise, at the Interim Servicer's sole expense. The Interim
Servicer agrees to cooperate with the Purchaser and such successor in
effecting the termination of the Interim Servicer's responsibilities and
rights hereunder as servicer, including, without limitation, the transfer to
such successor for administration by it of all cash amounts which shall at the
time be credited by the Interim Servicer to the Custodial Account or Escrow
Account or thereafter received with respect to the Mortgage Loans.
Section 10.02 Termination Without Cause.
The Purchaser may terminate, at its sole option, any rights the
Interim Servicer may have hereunder, without cause, upon sixty days notice or
as provided in this Section 10.02. Any such notice of termination shall be in
writing and delivered to the Interim Servicer by registered mail as provided
in Section 11.05. The Purchaser and the Interim Servicer shall comply with the
termination procedures set forth in Section 11.01 hereof.
Notwithstanding and in addition to the foregoing, in the event
that (i) a Mortgage Loan becomes delinquent for a period of 91 days or more (a
"Delinquent Mortgage Loan") or (ii) a Mortgage Loan becomes an REO Property,
the Purchaser may at its election terminate this Agreement with respect to
such Delinquent Mortgage Loan or REO Property without payment of a termination
fee therefor, upon 15 days' written notice to the Interim Servicer, provided,
that upon termination of the Agreement with respect to such Delinquent
Mortgage Loan or REO Property, the Purchaser shall reimburse the Interim
Servicer for all outstanding Servicing Advances or Servicing Fees.
Section 10.03 Agency Suspension.
Should the Interim Servicer at any time during the term of this
Agreement have its right to service temporarily or permanently suspended by
▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac or otherwise cease to be an approved servicer of
conventional residential mortgage loans for ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, then
the Purchase may immediately terminate this Agreement and accelerate
performance of the provisions of the Purchase Agreement to require immediate
transfer of the Servicing Rights.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01 Successor to Interim Servicer.
Prior to termination of the Interim Servicer's responsibilities
and duties under this Agreement pursuant to Sections 8.04, 9.01, 10.01 or
pursuant to Section 10.02 after the 90 day period has expired, the Purchaser
shall, (i) succeed to and assume all of the Interim Servicer's
responsibilities, rights, duties and obligations under this Agreement, or (ii)
appoint a successor having the characteristics set forth in clauses (i)
through (iii) of Section 8.02 and which shall succeed to all rights and assume
all of the responsibilities, duties and liabilities of the
41
Interim Servicer under this Agreement prior to the termination of Interim
Servicer's responsibilities, duties and liabilities under this Agreement. In
connection with such appointment and assumption, the Purchaser may make such
arrangements for the compensation of such successor out of payments on
Mortgage Loans as it and such successor shall agree. In the event that the
Interim Servicer's duties, responsibilities and liabilities under this
Agreement should be terminated pursuant to the aforementioned sections, the
Interim Servicer shall discharge such duties and responsibilities during the
period from the date it acquires knowledge of such termination until the
effective date thereof with the same degree of diligence and prudence which it
is obligated to exercise under this Agreement, and shall take no action
whatsoever that might impair or prejudice the rights or financial condition of
its successor. The resignation or removal of the Interim Servicer pursuant to
the aforementioned sections shall not become effective until a successor shall
be appointed pursuant to this Section 11.01.
Any successor appointed as provided herein shall execute,
acknowledge and deliver to the Interim Servicer and to the Purchaser an
instrument accepting such appointment, wherein the successor shall make the
representations and warranties set forth in Section 5.01, except for
subsections (b), (f) and (k) thereof, whereupon such successor shall become
fully vested with all the rights, powers, duties, responsibilities,
obligations and liabilities of the Interim Servicer, with like effect as if
originally named as a party to this Agreement. Any termination or resignation
of the Interim Servicer or termination of this Agreement pursuant to Section
8.04, 9.01, 10.01 or 10.02 shall not affect any claims that any Purchaser may
have against the Interim Servicer arising out of the Interim Servicer's
actions or failure to act prior to any such termination or resignation.
The Interim Servicer shall deliver promptly to the successor
servicer the Funds in the Custodial Account and Escrow Account and all
Mortgage Files and related documents and statements held by it hereunder and
the Interim Servicer 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 the Interim Servicer.
Upon a successor's acceptance of appointment as such, the Interim
Servicer shall notify by mail the Purchaser of such appointment in accordance
with the procedures set forth in Section 11.05.
Section 11.02 Amendment.
This Agreement may be amended from time to time by the Interim
Servicer and the Purchaser by written agreement signed by the Interim Servicer
and the Purchaser.
Section 11.03 Governing Law; Jurisdiction; Consent to Service of
Process.
THIS AGREEMENT SHALL BE DEEMED IN EFFECT WHEN A FULLY EXECUTED
COUNTERPART THEREOF IS RECEIVED BY THE PURCHASER IN THE STATE OF NEW YORK AND
SHALL BE DEEMED TO HAVE BEEN MADE IN THE STATE OF NEW YORK. THIS AGREEMENT
SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO ITS
42
CHOICE OF LAW RULES AND PRINCIPLES. EACH OF THE PURCHASER AND THE INTERIM
SERVICER IRREVOCABLY (I) SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE COURTS
OF THE STATE OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES OF
AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT; (II) WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT FORUM IN ANY ACTION OR
PROCEEDING IN ANY SUCH COURT; (III) AGREES THAT A FINAL JUDGMENT IN ANY ACTION
OR PROCEEDING IN ANY SUCH COURT SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY
OTHER JURISDICTION BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY
LAW; AND (IV) CONSENTS TO SERVICE OF PROCESS UPON IT BY MAILING A COPY THEREOF
BY CERTIFIED MAIL ADDRESSED TO IT AS PROVIDED FOR NOTICES HEREUNDER.
Section 11.04 Duration of Agreement.
This Agreement shall continue in existence and effect until
terminated as herein provided. This Agreement shall continue notwithstanding
transfers of the Mortgage Loans by the Purchaser. Notwithstanding any such
termination or the occurrence of an Event of Default, all of the
representations and warranties and covenants hereunder shall continue and
survive. The obligations of Interim Servicer under Sections 6.01 and 8.01
shall survive the termination of this Agreement.
Section 11.05 Notices.
All demands, notices and communications hereunder shall be in
writing and shall be deemed to have been duly given if personally delivered at
or mailed by registered mail, postage prepaid, addressed as follows:
(i) if to the Interim Servicer:
EverBank
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
or such other address as may hereafter be furnished to the
Purchaser in writing by the Interim Servicer;
(ii) if to Purchaser:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Whole Loan Operations Manager
Section 11.06 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or
terms of this Agreement shall be held invalid for any reason whatsoever, then
such covenants, agreements,
43
provisions or terms shall be deemed severable from the remaining covenants,
agreements, provisions or terms of this Agreement and shall in no way affect
the validity or enforceability of the other provisions of this Agreement.
Section 11.07 Relationship of Parties.
Nothing herein contained shall be deemed or construed to create a
partnership or joint venture between the parties hereto and the services of
the Interim Servicer shall be rendered as an independent contractor and not as
agent for the Purchaser.
Section 11.08 Execution; Successors and Assigns.
This Agreement may be executed in one or more counterparts and by
the different parties hereto on separate counterparts, each of which, when so
executed, shall be deemed to be an original; such counterparts, together,
shall constitute one and the same agreement. Subject to Section 8.04, this
Agreement shall inure to the benefit of and be binding upon the Interim
Servicer and the Purchaser and their respective successors and assigns.
Section 11.09 Recordation of Assignments of Mortgage.
To the extent permitted by applicable law, each of the Assignments
of Mortgage is subject to recordation in all appropriate public offices for
real property records in all the counties or other comparable jurisdictions in
which any or all of the Mortgaged Properties are situated, and in any other
appropriate public recording office or elsewhere, such recordation to be
effected at the Interim Servicer's expense in the event recordation is either
necessary under applicable law or requested by the Purchaser at its sole
option.
Section 11.10 Assignment by Purchaser.
The Purchaser shall have the right, without the consent of the
Interim Servicer but subject to the limit set forth in Section 2.02 hereof, to
assign, in whole or in part, its interest under this Agreement with respect to
some or all of the Mortgage Loans, and designate any person to exercise any
rights of the Purchaser hereunder. Upon such assignment of rights and
assumption of obligations, the assignee or designee shall accede to the rights
and obligations hereunder of the Purchaser with respect to such Mortgage Loans
and the Purchaser as assignor shall be released from all obligations hereunder
with respect to such Mortgage Loans from and after the date of such assignment
and assumption. All references to the Purchaser in this Agreement shall be
deemed to include its assignee or designee.
Section 11.11 No Personal Solicitation.
From and after the related Closing Date, the Interim Servicer
hereby agrees that it will not take any action or permit or cause any action
to be taken by any of its agents or affiliates, or by any independent
contractors on the Interim Servicer's behalf, to personally, by telephone or
mail (electronic means or otherwise), solicit the borrower or obligor under
any Mortgage Loan for any purpose whatsoever, including to refinance a
Mortgage Loan, in whole or in part, without the prior written consent of the
Purchaser. It is understood and agreed that all rights and benefits relating
to the solicitation of any Mortgagors and the attendant rights, title and
44
interest in and to the list of such Mortgagors and data relating to their
Mortgages (including insurance renewal dates) shall be transferred to the
Purchaser pursuant hereto on the related Closing Date and the Interim Servicer
shall take no action to undermine these rights and benefits. Notwithstanding
the foregoing, it is understood and agreed that promotions undertaken by the
Interim Servicer or any affiliate of the Interim Servicer which are directed
to the general public at large, including, without limitation, mass mailings
based on commercially acquired mailing lists, or the Interim Servicer's
customer portfolio, and newspaper, radio and television advertisements shall
not constitute solicitation under this Section 11.11
Section 11.12 Waiver of Trial by Jury.
THE INTERIM SERVICER AND THE PURCHASER EACH KNOWINGLY, VOLUNTARILY
AND INTENTIONALLY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY
RIGHT IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR RELATING
TO THIS AGREEMENT.
45
IN WITNESS WHEREOF, the Interim Servicer and the Purchaser have
caused their names to be signed hereto by their respective officers thereunto
duly authorized as of the day and year first above written.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ MORTGAGE CAPITAL INC.
By: ____________________________________
Name: __________________________________
Title: _________________________________
EVERBANK
By: ____________________________________
Name: __________________________________
Title: _________________________________
▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ )
) ss.:
COUNTY OF NEW YORK )
On the __ day of ________, 2005 before me, a Notary Public in and
for said State, personally appeared ________, known to me to be
______________________________ of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc., the
corporation that executed the within instrument and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand affixed my office
seal the day and year in this certificate first above written.
------------------------------------------
Notary Public
My Commission expires ____________________
STATE OF FLORIDA )
) ss.:
COUNTY OF FLORIDA )
On the __ day of _______, 2005 before me, a Notary Public in and
for said State, personally appeared __________, known to me to be
______________ of EverBank, the corporation that executed the within
instrument and also known to me to be the person who executed it on behalf of
said corporation, and acknowledged to me that such corporation executed the
within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand affixed my office
seal the day and year in this certificate first above written.
------------------------------------------
Notary Public
My Commission expires ____________________
EXHIBIT A
MORTGAGE LOAN SCHEDULE
A-1
EXHIBIT B
[RESERVED]
▇-▇
▇▇▇▇▇▇▇ ▇
[▇▇▇▇▇▇▇▇]
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
CUSTODIAL ACCOUNT CERTIFICATION
_____________________, 200_
EverBank hereby certifies that it has established the account
described below as a Custodial Account pursuant to the Amended and Restated
Interim Servicing Agreement, dated as of November 7, 2005, Conventional
Residential Mortgage Loans.
Title of Account: EverBank in trust for the Purchaser
Account Number: __________________
Address of office or branch
of the Interim Servicer at
which Account is maintained:
________________________________________
________________________________________
________________________________________
________________________________________
EVERBANK
Interim Servicer
By: ____________________________________
Name: __________________________________
Title: _________________________________
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
CUSTODIAL ACCOUNT LETTER AGREEMENT
_________________, 200_
To: _______________________________
_______________________________
_______________________________
(the "Depository")
As Interim Servicer under the Amended and Restated Interim
Servicing Agreement, dated as of November 7, 2005 (the "Agreement"), we hereby
authorize and request you to establish an account, as a Custodial Account
pursuant to Section 2.04 of the Agreement, to be designated as "EverBank, as
Interim Servicer, in trust for ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. and/or
subsequent Purchasers of fixed and adjustable rate Mortgage Loans." All
deposits in the account shall be subject to withdrawal therefrom by order
signed by the Interim Servicer. 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.
EVERBANK
By: ____________________________________
Name: __________________________________
Title: _________________________________
Date:___________________________________
D-2-1
The undersigned, as Depository, hereby certifies that the above
described account has been established under Account Number __________, at the
office of the Depository indicated above, and agrees to honor withdrawals on
such account as provided above. The full amount deposited at any time in the
account will be insured by the Federal Deposit Insurance Corporation through
the Bank Insurance Fund ("BIF") or the Savings Association Insurance Fund
("SAIF").
_______________________________________
Depository
By: ___________________________________
Name: _________________________________
Title: ________________________________
Date:__________________________________
D-2-2
EXHIBIT E-1
ESCROW ACCOUNT CERTIFICATION
__________________, 200_
EverBank hereby certifies that it has established the account
described below as an Escrow Account pursuant to Section 2.06 of the Amended
and Restated Interim Servicing Agreement, dated as of November 7, 2005.
Title of Account: "EverBank in trust for the Purchaser and various Mortgagors."
Account Number: __________________
Address of office or branch
of the Interim Servicer at
which Account is maintained:
________________________________________
________________________________________
________________________________________
________________________________________
EVERBANK
Interim Servicer
By: ____________________________________
Name: __________________________________
Title: _________________________________
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
ESCROW ACCOUNT LETTER AGREEMENT
_________________, 200_
To: _______________________________
_______________________________
_______________________________
(the "Depository")
As Interim Servicer under the Amended and Restated Interim
Servicing Agreement, dated as of November 7, 2005, (the "Agreement"), we
hereby authorize and request you to establish an account, as an Escrow Account
pursuant to Section 2.07 of the Agreement, to be designated as "EverBank, as
Interim Servicer, in trust for ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. and/or
subsequent Purchasers of fixed and adjustable rate Mortgage Loans." All
deposits in the account shall be subject to withdrawal therefrom by order
signed by the Interim Servicer. 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.
EVERBANK
Interim Servicer
By: ____________________________________
Name: __________________________________
Title: _________________________________
Date:___________________________________
E-2-1
The undersigned, as Depository, hereby certifies that the above
described account has been established under Account Number ______, at the
office of the Depository indicated above, and agrees to honor withdrawals on
such account as provided above. The full amount deposited at any time in the
account will be insured by the Federal Deposit Insurance Corporation through
the Bank Insurance Fund ("BIF") or the Savings Association Insurance Fund
("SAIF").
_______________________________________
Depository
By: ___________________________________
Name: _________________________________
Title: ________________________________
Date:__________________________________
E-2-2
EXHIBIT F
Reserved.
F-1
EXHIBIT G
PROCESS GUIDELINES
I. Contract
The Purchaser must provide the Interim Servicer with an Assignment &
Assumption Agreement or similar notice with respect to a transfer to ▇▇▇▇▇▇
Mae no less than five (5) Business Days prior to the last Business Day of the
month of transfer. Such document will confirm that the Mortgage Loans will be
serviced in accordance with the ▇▇▇▇▇▇ ▇▇▇ Servicing Guide. Such document must
also confirm that Mortgage Loans were sold to ▇▇▇▇▇▇ Mae under the special
servicing option.
II. Requirements for FNMA sales
A. The Servicing Fee less the ▇▇▇▇▇▇ ▇▇▇ guaranty fee ( the "Net
Servicing Fee") under the ▇▇▇▇▇▇ Mae sale must be equal to or
greater than the current Servicing Fee being paid to the Interim
Servicer by the Purchaser. Should the Net Servicing Fee exceed the
current Servicing Fee, any excess will be retained by the Interim
Servicer.
B. Preparation and recording of any Assignments of Mortgage with
respect to the Mortgage Loans, other than as required by the
underlying Seller's Warranties and Servicing Agreement, will be
the responsibility of the Purchaser.
C. Information required to transfer the loans into ▇▇▇▇▇▇ ▇▇▇ must be
received no less than five (5) Business Days prior to the last
Business Day of the transaction month.
D. Information to transfer the loans must be in an Excel file format
with the following data fields:
(i) servicer number; (ii) EverBank loan number; (iii) balance sold to
▇▇▇▇▇▇ Mae; (iv) pass-through rate; (v) interest rate; (vi) interest rate net
of the servicing fee rate and guarantee fee rate; (vii) ▇▇▇▇▇▇ ▇▇▇ loan
number; (viii) contract or pool number; (ix) if the transaction is an
"actual/actual" sale - contract number; and (x) if the transaction is an
"actual/actual" sale - date of first payment to ▇▇▇▇▇▇ Mae.
E. Balances must be verified with the Interim Servicer before the
Mortgage Loan(s) are sold to ▇▇▇▇▇▇ ▇▇▇.
G-1
F. The servicer number used to deliver the Mortgage Loan(s) to ▇▇▇▇▇▇
Mae must be approved by the Interim Servicer before the Mortgage
Loan(s) are sold. The Interim Servicer will assess a $500
correction penalty for each pool sold under a different
seller/servicer number than what was provided.
G. Final purchase advices and/or the 2005 forms must be received by
the Interim Servicer prior to the last Business Day of the
transaction month.
H. Purchaser must provide name and contact information of individual
authorized to discuss the sale terms. Investor name and broker
names need to be provided to the Interim Servicer.
III. Fees
Should the Purchaser sell loans to ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac (standard, not
REMIC) an additional setup fee may be charged. The Interim Servicer will
establish one investor number on each of the Interim Servicer's related Alltel
clients for the those Mortgage Loans sold by Purchaser to ▇▇▇▇▇▇ ▇▇▇
▇▇. Process Guidelines
A. Monthly reporting to the Purchaser on the status of loans will be
limited to existing Alltel delinquency and trial balance reports.
Reports will be as of each month-end and will be provided to the
Purchaser no later than the twenty (20) days following the related
month-end. The Purchaser will provide contact information for
monthly reporting, repurchase funding and claim settlement
processes.
B. For any Mortgage Loans required to be repurchased by the Purchaser
from ▇▇▇▇▇▇ Mae due to mortgagor credit defaults (rather than
administrative, legal or documentation issues), the Interim
Servicer will notify the Purchaser of the total amount due to
▇▇▇▇▇▇ ▇▇▇ for the Mortgage Loan to be repurchased no later than
the 3rd Business Day prior to the end of the month of repurchase.
The Purchaser will remit same amount, plus a $100 repurchase
processing fee to the Interim Servicer no later than the last
Business Day of the repurchase month. A late remittance penalty of
prime + 2% will be assessed from the date such remittance was due
through the date such remittance was actually made.
C. Wiring instructions for repurchases by the Purchaser:
[ ]
Account Number: [ ]
Account Name: [ ]
ATTN: [ ], ▇▇▇▇▇▇ Mae
Telephone: [ ]
D. An additional investor number will be established for Mortgage
Loans repurchased by the Purchaser. Such investor number will be
actual/actual remittance with month-end cutoff. Reports and
remittances will be due on the tenth calendar day of each month.
EXHIBIT H
[RESERVED]
H-1
EXHIBIT I
---------
INTERIM SERVICER'S OFFICER'S CERTIFICATE
I, ___________________________ hereby certify that I am the duly
elected ____________________ of [INTERIM SERVICER], a ___________________ (the
"Interim Servicer"), and further certify, on behalf of the Interim Servicer as
follows:
1. Attached hereto as Attachment I are a true and correct copy of
the [Certificate of Incorporation and by-laws] [Certificate of limited
partnership and limited partnership agreement] of the Interim Servicer
as are in full force and effect on the date hereof.
2. No proceedings looking toward merger, liquidation, dissolution
or bankruptcy of the Interim Servicer are pending or contemplated.
3. Each person who, as an officer or attorney-in-fact of the
Interim Servicer, signed (a) the Amended and Restated Interim Servicing
Agreement (the "Servicing Agreement"), dated as of November 7, 2005, by
and between the Seller and Purchaser (the "Purchaser"); (b) the Purchase
Price and Terms Agreement, dated ____________ 200_, between the Interim
Servicer and the Purchaser (the "Purchase Price and Terms Agreement");
and (c) any other document delivered prior hereto or on the date hereof
in connection with the sale and servicing of the Mortgage Loans in
accordance with the Servicing Agreement and the Purchase Price and Terms
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 or attorney-in-fact, and the signatures of such
persons appearing on such documents are their genuine signatures.
4. Attached hereto as Attachment II is a true and correct copy of
the resolutions duly adopted by the board of directors of the Interim
Servicer on ____________, 2004 (the "Resolutions") with respect to the
authorization and approval of the sale and servicing of the Mortgage
Loans; said Resolutions have not been amended, modified, annulled or
revoked and are in full force and effect on the date hereof.
5. Attached hereto as Attachment III is a Certificate of Good
Standing of the Interim Servicer dated ________, 2005. No event has
occurred since ____________, 2004 which has affected the good standing
of the Interim Servicer under the laws of the State of ____________.
6. All of the representations and warranties of the Interim
Servicer contained in Section 5.01 of the Servicing Agreement were true
and correct in all material respects as of the date of the Purchase
Agreement and are true and correct in all material respects as of the
date hereof.
I-1
7. The Interim Servicer has performed all of its duties and has
satisfied all the material conditions on its part to be performed or
satisfied prior to the Closing Date pursuant to the Purchase Agreement
and the related Purchase Price and Terms Agreement.
All capitalized terms used herein and not otherwise defined shall
have the meaning assigned to them in the Purchase Agreement.
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the
seal of the Interim Servicer.
Dated:
-----------------------------
[Seal]
[INTERIM SERVICER]
(Interim Servicer)
By:
--------
Name:
--------
Title: Vice President
I, __________________, Secretary of the Interim Servicer, hereby
certify that __________________ is the duly elected, qualified and acting Vice
President of the Interim Servicer and that the signature appearing above is
his genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated:
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[Seal]
[INTERIM SERVICER]
(Interim Servicer)
By:
------
Name:
----
Title: [Assistant] Secretary
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EXHIBIT J
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[RESERVED]
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EXHIBIT K
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[RESERVED]
K-1
EXHIBIT L
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ASSIGNMENT AND CONVEYANCE
On this __________ day of _________, ▇▇▇▇, ▇▇▇▇▇▇▇▇ ("Interim
Servicer") as the Interim Servicer under that certain Second Amended and
Restated Mortgage Loan and Warranties Purchase Agreement, dated as of November
1, 2004 (the "Agreement") does hereby sell, transfer, assign, set over and
convey to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. as Purchaser under the
Agreement, without recourse, but subject to the terms of the Agreement, all
rights, title and interest of the Interim Servicer in and to the Mortgage
Loans listed on the Mortgage Loan Schedule attached hereto as Exhibit A (the
"Mortgage Loans"), together with the related Mortgage Files and all rights and
obligations arising under the documents contained therein. Each Mortgage Loan
subject to the Agreement was underwritten in accordance with, and conforms to,
the Underwriting Guidelines attached hereto as Exhibit B. Pursuant to Section
2.04 of the Agreement, the Interim Servicer has delivered to the Custodian the
documents for each Mortgage Loan to be purchased as set forth in the Custodial
Agreement. The contents of each related Servicing File required to be retained
by the Interim Servicer to service the Mortgage Loans pursuant to the
Agreement and thus not delivered to the Purchaser are and shall be held in
trust by the Interim Servicer for the benefit of the Purchaser as the owner
thereof. The Interim Servicer's possession of any portion of each such
Servicing File is at the will of the Purchaser for the sole purpose of
facilitating servicing of the related Mortgage Loan pursuant to the Agreement,
and such retention and possession by the Interim Servicer shall be in a
custodial capacity only. The ownership of each Mortgage Note, Mortgage, and
the contents of the Mortgage File and Servicing File is vested in the
Purchaser and the ownership of all records and documents with respect to the
related Mortgage Loan prepared by or which come into the possession of the
Interim Servicer shall immediately vest in the Purchaser and shall be retained
and maintained, in trust, by the Interim Servicer at the will of the Purchaser
in such custodial capacity only.
The Interim Servicer confirms to the Purchaser that the
representations and warranties set forth in Sections 3.01 and 3.02 of the
Agreement are true and correct as of the date hereof, and that all statements
made in the Interim Servicer's Officer's Certificates and all Attachments
thereto remain complete, true and correct in all respects as of the date
hereof, and with respect to this Mortgage Loan Package, the Interim Servicer
makes the following additional representations and warranties to the
Purchaser, which additional representations and warranties are hereby
incorporated into Section 3.02 of the Agreement:
LOAN TYPE: [FIXED RATE] [ADJUSTABLE RATE]
Number of Mortgage Loans: _________________________
Original Principal Balance: $________________________
Stated Principal Balance: $________________________
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Weighted Average Mortgage Interest Rate: _____%
Weighted Average Servicing Fee Rate: _____%
Weighted Average Mortgage Loan
Remittance Rate: _____%
Weighted Average LTV: _____%
Weighted Average Remaining Months
to Maturity: _______ months
For Adjustable Rate Mortgage Loans:
Type: _______
Index: _______
Weighted Average Gross Margin: _______%
Weighted Average Months to
Next Adjustment Date: _______ months
Capitalized terms used herein and not otherwise defined shall have
the meanings set forth in the Agreement.
EVERBANK
(Interim Servicer)
By:
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Name:
---------------------------------------------------------
Title:
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EXHIBIT M
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FORM OF ANNUAL CERTIFICATION
Re: The Amended and Restated Interim Servicing Agreement dated as of
November 7, 2005 (the "Agreement"), among ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ MORTGAGE
CAPITAL INC. and EVERBANK
I, ________________________________, the _______________________ of
[NAME OF COMPANY], certify to [the Purchaser], [the Depositor], and the
[Master Servicer] [Securities Administrator] [Trustee], and their officers,
with the knowledge and intent that they will rely upon this certification,
that:
(1) I have reviewed the servicer compliance statement of the
Seller provided in accordance with Item 1123 of Regulation AB (the
"Compliance Statement"), the report on assessment of the 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 of Regulation AB (the
"Servicing Assessment"), the registered public accounting firm's
attestation report provided in accordance with Rules 13a-18 and 15d-18
under the Exchange Act and Section 1122(b) of Regulation AB (the
"Attestation Report"), and all servicing reports, officer's certificates
and other information relating to the servicing of the Mortgage Loans by
the Seller during 200[ ] that were delivered by the Seller to the
[Depositor] [Master Servicer] [Securities Administrator] [Trustee]
pursuant to the Agreement (collectively, the "Seller Servicing
Information");
(2) Based on my knowledge, the Seller Servicing Information, taken
as a whole, does not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements made, in
the light of the circumstances under which such statements were made,
not misleading with respect to the period of time covered by the Seller
Servicing Information;
(3) Based on my knowledge, all of the Seller Servicing Information
required to be provided by the Seller under the Agreement has been
provided to the [Depositor] [Master Servicer] [Securities Administrator]
[Trustee];
(4) I am responsible for reviewing the activities performed by the
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, the Seller has fulfilled its
obligations under the Agreement; and
(5) The Compliance Statement required to be delivered by the
Seller pursuant to this Agreement, and the Servicing Assessment and
Attestation Report required to be provided by the Seller and by each
Subcontractor pursuant to the Agreement, have been provided to the
[Depositor] [Master Servicer]. Any material instances of noncompliance
described in such reports have been disclosed to the [Depositor] [Master
Servicer]. Any
M-1
material instance of noncompliance with the Servicing Criteria has been
disclosed in such reports.
Date: _________________________
By: ________________________________
Name:
Title:
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