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_______________________________
as Servicer,
HOME EQUITY LOAN TRUST [ ]-[ ],
as Issuer
and
__________________________
as Indenture Trustee
_________________________
SERVICING AGREEMENT
Dated as of _____________
_________________________
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TABLE OF CONTENTS
Page
This Servicing Agreement, dated as of _________________ (the
"Agreement"), is among __________________, as servicer (the "Servicer"), the
Home Equity Loan Trust [ ]-[ ], as issuer (the "Issuer"), and
__________________, as indenture trustee (the "Indenture Trustee").
WITNESSETH:
WHEREAS, pursuant to the terms of the Purchase Agreement (as defined
herein), ____________________, as seller (in such capacity, "__________") and
as servicer, and ___________________, as seller ("___________" and, with
_________, each a "Seller" and together, the "Sellers"), will sell to
Residential Asset Mortgage Products, Inc. ("RAMP"), as purchaser (in such
capacity, the "Purchaser"), the Initial Mortgage Loans on the Closing Date,
and may sell Subsequent Mortgage Loans on one or more Subsequent Transfer
Dates, together with the Related Documents on the Closing Date and any
Subsequent Transfer Date, and thereafter all Additional Balances created on
or after the Cut-Off Date and any such Subsequent Transfer Date;
WHEREAS, RAMP, as depositor (in such capacity, the "Depositor"), will
sell the Initial Mortgage Loans and assign all of its rights under the
Purchase Agreement to the Issuer, together with the Related Documents on the
Closing Date, and thereafter all Additional Balances relating thereto created
on or after the Cut-Off Date;
WHEREAS, pursuant to the terms of the Trust Agreement, the Issuer will
issue the Certificates;
WHEREAS, pursuant to the terms of the Indenture, the Issuer will issue
the Notes; and
WHEREAS, pursuant to the terms of this Agreement, the Servicer will
service the Mortgage Loans directly or through one or more Subservicers.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
ARTICLE I
Definitions
Section 1.01 Definitions. For all purposes of this Agreement, except as
otherwise expressly provided herein or unless the context otherwise requires,
capitalized terms not otherwise defined herein shall have the meanings
assigned to such terms in the Definitions contained in Appendix A to the
indenture dated as of ______________ (the "Indenture"), between the Issuer
and the Indenture Trustee, which is incorporated by reference herein. All
other capitalized terms used herein shall have the meanings specified herein.
Section 1.02 Other Definitional Provisions.
(a) All terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
(b) As used in this Agreement and in any certificate or other document made
or delivered pursuant hereto or thereto, accounting terms not
defined in this Agreement or in any such certificate or other
document, and accounting terms partly defined in this Agreement
or in any such certificate or other document, to the extent not
defined, shall have the respective meanings given to them under
generally accepted accounting principles. To the extent that the
definitions of accounting terms in this Agreement or in any such
certificate or other document are inconsistent with the meanings
of such terms under generally accepted accounting principles, the
definitions contained in this Agreement or in any such
certificate or other document shall control.
(c) The words "hereof," "herein," "hereunder" and words of similar import
when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement;
Section and Exhibit references contained in this Agreement are
references to Sections and Exhibits in or to this Agreement
unless otherwise specified; the term "including" shall mean
"including without limitation"; "or" shall include "and/or"; and
the term "proceeds" shall have the meaning ascribed thereto in
the UCC.
(d) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the
masculine as well as the feminine and neuter genders of such
terms.
(e) Any agreement, instrument or statute defined or referred to herein or
in any instrument or certificate delivered in connection herewith
means such agreement, instrument or statute as from time to time
amended, modified or supplemented and includes (in the case of
agreements or instruments) references to all attachments thereto
and instruments incorporated therein; references to a Person are
also to its permitted successors and assigns.
Section 1.03 Interest Calculations. All calculations of interest
hereunder that are made in respect of a Mortgage Loan shall be made in
conformity with the related Loan Agreement. All calculations of interest on
the Notes shall be made on the basis of the actual number of days in an
Interest Period and a year assumed to consist of 360-days. The calculation
of the Servicing Fee shall be made on the basis of a 360-day year consisting
of twelve 30-day months. All dollar amounts calculated hereunder shall be
rounded to the nearest ▇▇▇▇▇ with one-half of one ▇▇▇▇▇ being rounded up.
ARTICLE II
Representations and Warranties
Section 2.01 Representations and Warranties Regarding the Servicer. The
Servicer represents and warrants to the Issuer and for the benefit of the
Indenture Trustee, as pledgee of the Mortgage Loans, as of the Closing Date:
(a) the Servicer is a corporation duly organized, validly existing and in
good standing under the laws of [ ] and has the corporate
power to own its assets and to transact the business in which it
is currently engaged. The Servicer is duly qualified to do
business as a foreign corporation and is in good standing in each
jurisdiction in which the character of the business transacted by
it or properties owned or leased by it requires such
qualification and in which the failure to so qualify would have a
material adverse effect (not in the ordinary course of business)
on the business, properties, assets, or condition (financial or
other) of the Servicer;
(b) the Servicer has the power and authority to make, execute, deliver and
perform this Agreement and all of the transactions contemplated
under this Agreement, and has taken all necessary corporate
action to authorize the execution, delivery and performance of
this Agreement. When executed and delivered, this Servicing
Agreement will constitute the legal, valid and binding obligation
of the Servicer enforceable in accordance with its terms, except
as enforcement of such terms may be limited by bankruptcy,
insolvency or similar laws affecting the enforcement of
creditors' rights generally and by the availability of equitable
remedies;
(c) the Servicer is not required to obtain the consent of any other Person
or any consent, license, approval or authorization from, or
registration or declaration with, any governmental authority,
bureau or agency in connection with the execution, delivery,
performance, validity or enforceability of this Agreement, except
for such consent, license, approval or authorization, or
registration or declaration, as shall have been obtained or
filed, as the case may be;
(d) the execution and delivery of this Agreement and the performance of the
transactions contemplated hereby by the Servicer will not violate
any material provision of any existing law or regulation or any
order or decree of any court applicable to the Servicer or any
provision of the Articles of Incorporation or Bylaws of the
Servicer, or constitute a material breach of any material
mortgage, indenture, contract or other agreement to which the
Servicer is a party or by which the Servicer may be bound;
(e) no litigation or administrative proceeding of or before any court,
tribunal or governmental body is currently pending, or to the
knowledge of the Servicer threatened, against the Servicer or any
of its properties or with respect to this Agreement or the
Securities which in the opinion of the Servicer has a reasonable
likelihood of resulting in a material adverse effect on the
transactions contemplated by this Agreement;
(f) the Servicer is a member of MERS in good standing, and will comply in
all material respects with the rules and procedures of MERS in
connection with the servicing of the Mortgage Loans that are
registered with MERS; and
(g) the servicing of the Mortgage Loans has at all times been conducted in
material compliance with all applicable federal, state and local
laws, rules and regulations and there has been no material
violation of any such laws, rules or regulations arising out of
the servicing of the Mortgage Loans.
The foregoing representations and warranties shall survive any
termination of the Servicer hereunder.
Section 2.02 Representations and Warranties of the Issuer. The Issuer
hereby represents and warrants to the Servicer and for the benefit of the
Indenture Trustee, as pledgee of the Mortgage Loans, as of the Closing Date:
(a) the Issuer is a statutory trust duly formed and in good standing under
the laws of the State of Delaware and has full power, authority
and legal right to execute and deliver this Agreement and to
perform its obligations under this Agreement, and has taken all
necessary action to authorize the execution, delivery and
performance by it of this Agreement; and
(b) the execution and delivery by the Issuer of this Agreement and the
performance by the Issuer of its obligations under this Agreement
will not violate any provision of any law or regulation governing
the Issuer or any order, writ, judgment or decree of any court,
arbitrator or governmental authority or agency applicable to the
Issuer or any of its assets. Such execution, delivery,
authentication and performance will not require the
authorization, consent or approval of, the giving of notice to,
the filing or registration with, or the taking of any other
action with respect to, any governmental authority or agency
regulating the activities of limited liability companies. Such
execution, delivery, authentication and performance will not
conflict with, or result in a breach or violation of, any
mortgage, deed of trust, lease or other agreement or instrument
to which the Issuer is bound.
Section 2.03 Enforcement of Representations and Warranties. The
Servicer, on behalf of and subject to the direction of the Indenture Trustee,
as pledgee of the Mortgage Loans, or the Issuer, shall enforce the
representations and warranties of the Sellers pursuant to the Purchase
Agreement. Upon the discovery by the Sellers, RAMP, the Servicer, the
Indenture Trustee, the Enhancer, the Issuer, or the Custodian of a breach of
any of the representations and warranties made by a Seller in the Purchase
Agreement, in respect of any Mortgage Loan which materially and adversely
affects the interests of the Securityholders or the Enhancer, the party
discovering such breach shall give prompt written notice to the other parties
(the Custodian being so obligated under the Custodial Agreement). The
Servicer shall promptly notify such Seller of such breach and request that,
pursuant to the terms of the Purchase Agreement, the Seller either (i) cure
such breach in all material respects within 90 days from the date the Seller
was notified of such breach or (ii) purchase such Mortgage Loan from the
Issuer at the price and in the manner set forth in Section 3.1(d) of the
Purchase Agreement; provided, that the Seller shall, subject to the
conditions set forth in the Purchase Agreement, have the option to substitute
an Eligible Substitute Loan or Loans for such Mortgage Loan. In the event
that the Seller elects to substitute one or more Eligible Substitute Loans
pursuant to Section 3.1(e) of the Purchase Agreement, the Seller shall
deliver to the Custodian or the Servicer, in accordance with the Purchase
Agreement, with respect to such Eligible Substitute Loans, the original Loan
Agreement, the Mortgage, and such other documents and agreements as are
required by the Purchase Agreement. Payments due with respect to Eligible
Substitute Loans in the month of substitution shall not be transferred to the
Issuer and will be retained by the Servicer and remitted by the Servicer to
such Seller on the next succeeding Payment Date except to the extent that a
payment less than the applicable Minimum Monthly Payment has been received by
the Issuer for such month in respect of the Mortgage Loan to be removed. The
Servicer shall amend or cause to be amended the Mortgage Loan Schedule to
reflect the removal of such Mortgage Loan and the substitution of the
Eligible Substitute Loans and the Servicer shall promptly deliver the amended
Mortgage Loan Schedule to the Owner Trustee and Indenture Trustee.
It is understood and agreed that the obligation of the Sellers to cure
such breach or purchase or substitute for such Mortgage Loan as to which such
a breach has occurred and is continuing shall constitute the sole remedy
respecting such breach available to the Issuer and the Indenture Trustee, as
pledgee of the Mortgage Loans, against any Seller. In connection with the
purchase of or substitution for any such Mortgage Loan by such Seller, the
Issuer shall assign to such Seller all of its right, title and interest in
respect of the Purchase Agreement applicable to such Mortgage Loan. Upon
receipt of the Repurchase Price, or upon completion of such substitution, the
Servicer shall notify the Custodian, and the Custodian shall deliver the Loan
Agreements to the Servicer, together with all relevant endorsements and
assignments prepared by the Servicer that the Indenture Trustee shall execute.
ARTICLE III
Administration and Servicing of Mortgage Loans
Section 3.01 The Servicer.
(a) The Servicer shall service and administer the Mortgage Loans in a
manner generally consistent with the terms of the Program Guide
and in a manner consistent with the terms of this Agreement and
that shall be normal and usual in its general mortgage servicing
activities and consistent with the manner in which it services
all other Mortgage Loans in its servicing portfolio with
characteristics similar to those of the Mortgage Loans. The
Servicer shall have full power and authority, acting alone or
through a Subservicer, to do any and all things in connection
with such servicing and administration which it may deem
necessary or desirable, it being understood, however, that the
Servicer shall at all times remain responsible to the Issuer and
the Indenture Trustee, as pledgee of the Mortgage Loans, for the
performance of its duties and obligations hereunder in accordance
with the terms hereof and the Program Guide. Without limiting
the generality of the foregoing, the Servicer shall continue, and
is hereby authorized and empowered by the Issuer and the
Indenture Trustee, as pledgee of the Mortgage Loans, to execute
and deliver, on behalf of itself, the Issuer, the Indenture
Trustee or any of them, any and all instruments of satisfaction
or cancellation, or of partial or full release or discharge and
all other comparable instruments with respect to the Mortgage
Loans and the Mortgaged Properties. The Issuer, the Indenture
Trustee and the Custodian, as applicable, shall furnish the
Servicer with any powers of attorney and other documents
necessary or appropriate to enable the Servicer to carry out its
servicing and administrative duties hereunder. In addition, the
Servicer may, at its own discretion and on behalf of the
Indenture Trustee, obtain credit information in the form of a
"credit score" from a credit repository. On the Closing Date,
the Indenture Trustee shall deliver to the Servicer a limited
power of attorney substantially in the form of Exhibit B hereto.
The Servicer is further authorized and empowered by the Issuer
and the Indenture Trustee, on behalf of the Noteholders and the
Indenture Trustee, in its own name or in the name of the
Subservicer, when the Servicer or the Subservicer, as the case
may be, believes it appropriate in its best judgment to register
any Mortgage Loan on the MERS® System, or cause the removal from
the registration of any Mortgage Loan on the MERS® System, to
execute and deliver, on behalf of the Indenture Trustee and the
Noteholders or any of them, any and all instruments of assignment
and other comparable instruments with respect to such assignment
or re-recording of a Mortgage in the name of MERS, solely as
nominee for the Indenture Trustee and its successors and assigns.
The Indenture Trustee shall have no ongoing responsibility to
check the status of the Mortgage Loans on the MERS® System. Any
expenses incurred in connection with the actions described in the
preceding sentence shall be borne by the Servicer, with no right
of reimbursement.
Subject to Section 3.15, if the Mortgage did not have a Lien senior to
the related Mortgage Loan on the related Mortgaged Property as of the related
Cut-Off Date, then the Servicer, in such capacity, may not consent to the
placing of a Lien senior to that of the Mortgage on the related Mortgaged
Property. Subject to Section 3.15, if the Mortgage had a Lien senior to the
related Mortgage Loan on the related Mortgaged Property as of the related
Cut-Off Date, then the Servicer, in such capacity, may not consent to the
refinancing of such prior senior Lien; unless (i) the resulting CLTV of such
Mortgage Loan is no higher than the greater of the CLTV prior to such
refinancing or a 70% CLTV (or a 80% CLTV for those borrowers with a FICO
"credit score" of 720 or greater) and (ii) the interest rate for the loan
evidencing the refinanced senior Lien is no higher than the interest rate on
the loan evidencing the existing senior Lien immediately prior to the date of
such refinancing (meaning, in the case of an adjustable rate loan, a
substantially similar index and a gross margin no higher than that of the
existing senior Lien); provided, however, that if the loan evidencing the
existing senior Lien prior to the date of refinancing is an adjustable rate
loan and the loan evidencing the refinanced senior Lien is a fixed rate loan,
then the interest rate on the loan evidencing the refinanced senior Lien may
be up to 2.0% higher than the then-current mortgage rate of the loan
evidencing the existing senior Lien and (iii) the loan evidencing the
refinanced senior Lien is not subject to negative amortization.
In connection with servicing the Mortgage Loans, the Servicer may take
reasonable actions to encourage or effect the termination of Loan Agreements
that have become dormant.
The relationship of the Servicer (and of any successor to the Servicer
as servicer under this Agreement) to the Issuer under this Agreement is
intended by the parties to be that of an independent contractor and not that
of a joint venturer, partner or agent.
(b) The Servicer may enter into Subservicing Agreements with Subservicers
for the servicing and administration of certain of the Mortgage
Loans. The Servicer shall provide notice to the Indenture Trustee
upon entering into a Subservicing Agreement. References in this
Agreement to actions taken or to be taken by the Servicer in
servicing the Mortgage Loans include actions taken or to be taken
by a Subservicer on behalf of the Servicer and any amount
actually received by such Subservicer in respect of a Mortgage
Loan shall be deemed to have been received by the Servicer
whether or not actually received by the Servicer. Each
Subservicing Agreement will be upon such terms and conditions as
are not inconsistent with this Agreement and as the Servicer and
the Subservicer have agreed. With the approval of the Servicer,
a Subservicer may delegate its servicing obligations to
third-party servicers, but such Subservicers will remain
obligated under the related Subservicing Agreements. The
Servicer and the Subservicer may enter into amendments to the
related Subservicing Agreements; provided, however, that any such
amendments shall not cause the Mortgage Loans to be serviced in a
manner that would be materially inconsistent with the standards
set forth in this Agreement. The Servicer shall be entitled to
terminate any Subservicing Agreement in accordance with the terms
and conditions thereof and without any limitation by virtue of
this Agreement; provided, however, that in the event of
termination of any Subservicing Agreement by the Servicer or the
Subservicer, the Servicer shall either act as servicer of the
related Mortgage Loan or enter into a Subservicing Agreement with
a successor Subservicer which will be bound by the terms of the
related Subservicing Agreement. The Servicer shall be entitled
to enter into any agreement with a Subservicer for
indemnification of the Servicer and nothing contained in this
Agreement shall be deemed to limit or modify such indemnification.
In the event that the rights, duties and obligations of the Servicer
are terminated hereunder, any successor to the Servicer in its sole
discretion may, to the extent permitted by applicable law, terminate the
existing Subservicing Agreement with any Subservicer in accordance with the
terms of the applicable Subservicing Agreement or assume the terminated
Servicer's rights and obligations under such subservicing arrangements which
termination or assumption will not violate the terms of such arrangements.
As part of its servicing activities hereunder, the Servicer, for the
benefit of the Indenture Trustee, the Enhancer and the Securityholders, shall
use reasonable efforts to enforce the obligations of each Subservicer under
the related Subservicing Agreement, to the extent that the non-performance of
any such obligation would have a material adverse effect on a Mortgage Loan.
Such enforcement, including, without limitation, the legal prosecution of
claims, termination of Subservicing Agreements and the pursuit of other
appropriate remedies, shall be in such form and carried out to such an extent
and at such time as the Servicer, in its good faith business judgment, would
require were it the owner of the related Mortgage Loans. The Servicer shall
pay the costs of such enforcement at its own expense, and shall be reimbursed
therefor only (i) from a general recovery resulting from such enforcement to
the extent, if any, that such recovery exceeds all amounts due in respect of
the related Mortgage Loan or (ii) from a specific recovery of costs, expenses
or attorneys fees against the party against whom such enforcement is directed.
(c) All other documents contained in the Mortgage File and any
original documents relating to the Mortgage Loans not contained in the
Mortgage File or delivered to the Custodian, if any, or the Indenture Trustee
are and shall be held by the Servicer in trust as agent for the Indenture
Trustee on behalf of the Noteholders.
Section 3.02 Collection of Certain Mortgage Loan Payments.
(a) The Servicer shall make reasonable efforts to collect all payments
called for under the terms and provisions of the Mortgage Loans,
and shall, to the extent such procedures shall be consistent with
this Agreement and generally consistent with the Program Guide,
follow such collection procedures as shall be normal and usual in
its general mortgage servicing activities and consistent with the
procedures the Servicer employs in servicing all other Mortgage
Loans in the servicing portfolio with characteristics similar to
those of the Mortgage Loans. Consistent with the foregoing, and
without limiting the generality of the foregoing, the Servicer
may in its discretion (i) waive any late payment charge, penalty
interest or other fees which may be collected in the ordinary
course of servicing a Mortgage Loan and (ii) arrange with a
Mortgagor a schedule for the payment of principal and interest
due and unpaid; provided, that such arrangement is consistent
with the Servicer's policies with respect to home equity mortgage
loans; and provided further, that notwithstanding such
arrangement, such Mortgage Loans will be included in the
information regarding delinquent Mortgage Loans set forth in the
Servicing Certificate. The Servicer may also extend the Due Date
for payment due on a Mortgage Loan in accordance with the Program
Guide; provided, however, that the Servicer shall first determine
that any such waiver or extension will not impair the coverage of
any related insurance policy or materially adversely affect the
Lien of the related Mortgage or the interests of the
Securityholders or the Enhancer, and the Servicer shall not grant
any such waiver or extension that would have any such effect.
Consistent with the terms of this Agreement, the Servicer may
also:
(i) waive, modify or vary any term of any Mortgage Loan (including reduce
the Credit Limit);
(ii) consent to the postponement of strict compliance with any such term or
in any manner grant indulgence to any Mortgagor;
(iii) arrange with a Mortgagor a schedule for the payment of principal and
interest due and unpaid;
(iv) forgive any portion of the amounts contractually owed under the
Mortgage Loan;
(v) capitalize past due amounts owed under the Mortgage Loan by adding any
amounts in arrearage to the existing principal balance of the Mortgage
Loan (a "Capitalization Workout") which will result in an increased
monthly payment amount, provided that: (A) the amount added to the
existing principal balance of the Mortgage Loan (the "Capitalized
Amount") shall be no greater than five times the Mortgagor's current
Minimum Monthly Payment amount; and (B) the Servicer shall not enter
into a Capitalization Workout unless the CLTV of the Mortgage Loan
prior to the Capitalization Workout equals or exceeds 80% and the
Mortgagor has qualified for the Capitalization Workout under the
Servicer's servicing guidelines; or
(vi) reset the maturity date for the Mortgage Loan, but in no event shall
such reset date extend beyond the end of the Collection Period
preceding the Final Payment Date;
or any combination of the foregoing, if in the Servicer's
determination such waiver, modification, postponement or indulgence is not
materially adverse to the interests of the Securityholders or the Enhancer;
provided, however, that the Servicer may not modify or permit any Subservicer
to modify any Mortgage Loan (including without limitation any modification
that would change the Loan Rate, forgive the payment of any principal or
interest (unless in connection with the liquidation of the related Mortgage
Loan) or extend the final maturity date of such Mortgage Loan) unless such
Mortgage Loan is in default or, in the judgment of the Servicer, such default
is reasonably foreseeable. The general terms of any waiver, modification,
forgiveness, postponement or indulgence with respect to any of the Mortgage
Loans will be included in the Servicing Certificate, and such Mortgage Loans
will not be considered "delinquent" for the purposes of the Basic Documents
so long as the Mortgagor complies with the terms of such waiver,
modification, forgiveness, postponement or indulgence.
(b) The Servicer shall establish a Custodial Account, which shall be an
Eligible Account, titled "Home Equity Loan Trust Series [
]-[ ]," in which the Servicer shall deposit or cause to be
deposited any amounts representing payments and collections in
respect of the Initial Mortgage Loans received by it subsequent
to or on the Cut-Off Date or, with respect to the Subsequent
Mortgage Loans, the Subsequent Cut-Off Date (other than in
respect of the payments referred to in the following paragraph),
within two Business Days following receipt thereof (or otherwise
on or prior to the Closing Date), including the following
payments and collections received or made by it (without
duplication):
(i) all payments of principal of or interest on the Mortgage Loans received
or advanced by the Servicer, net of any portion of the interest thereof
retained by any Subservicer as subservicing fees;
(ii) the aggregate Repurchase Price of the Mortgage Loans purchased by the
Servicer pursuant to Section 3.15;
(iii) Net Liquidation Proceeds, net of any related Foreclosure Profit and all
Subsequent Net Recovery Amounts;
(iv) all proceeds of any Mortgage Loans repurchased by a Seller pursuant to
the Purchase Agreement, and all Substitution Adjustment Amounts
required to be deposited in connection with the substitution of an
Eligible Substitute Loan pursuant to the Purchase Agreement;
(v) Insurance Proceeds, other than Net Liquidation Proceeds, resulting from
any insurance policy maintained on a Mortgaged Property; and
(vi) amounts required to be paid by the Servicer pursuant to Section 8.08;
provided, however, that with respect to each Collection Period, the Servicer
shall be permitted to retain from payments in respect of interest on the
Mortgage Loans, the Servicing Fee for such Collection Period. The foregoing
requirements respecting deposits to the Custodial Account are exclusive, it
being understood that, without limiting the generality of the foregoing, the
Servicer need not deposit in the Custodial Account amounts representing
Foreclosure Profits, fees (including annual fees) or late charge penalties,
payable by Mortgagors (such amounts to be retained as additional servicing
compensation in accordance with Section 3.09 hereof), or amounts received by
the Servicer for the accounts of Mortgagors for application towards the
payment of taxes, insurance premiums, assessments and similar items. In the
event any amount not required to be deposited in the Custodial Account is so
deposited, the Servicer may at any time withdraw such amount from the
Custodial Account, any provision herein to the contrary notwithstanding. The
Servicer shall retain all Foreclosure Profits as additional servicing
compensation.
The Servicer, in its sole discretion, may deposit into the Custodial
Account, Servicer Advances, representing installments of principal of or
interest on Mortgage Loans that were delinquent as of the end of any
Collection Period, provided that the Servicer reasonably believes that such
amounts will be recoverable from Collections on the related Mortgage Loan.
If the Servicer makes any such Servicer Advances, the Servicer shall be
entitled to reimburse itself by withdrawing from the Custodial Account, as
provided herein, any amounts so advanced. The Servicer may cause the
institution maintaining the Custodial Account to invest any funds in the
Custodial Account in Permitted Investments (including obligations of the
Servicer or any of its Affiliates, if such obligations otherwise qualify as
Permitted Investments), which investments shall mature not later than the
Business Day preceding the next succeeding Payment Date, and which
investments shall not be sold or disposed of prior to maturity. In addition,
no such Permitted Investment shall be purchased at a price in excess of par.
Except as provided above, all income and gain realized from any such
investment shall inure to the benefit of the Servicer and shall be subject to
its withdrawal or order from time to time. The amount of any losses incurred
in respect of the principal amount of any such investments shall be deposited
in the Custodial Account by the Servicer out of its own funds immediately as
realized.
(c) The Servicer shall require each Subservicer to hold all funds
constituting collections on the Mortgage Loans, pending
remittance thereof to the Servicer, in one or more accounts
meeting the requirements of an Eligible Account, and shall
require all such funds to be invested in Permitted Investments,
unless all such collections are remitted on a daily basis to the
Servicer for deposit into the Custodial Account.
Section 3.03 Withdrawals from the Custodial Account. The Servicer
shall, from time to time as provided herein, make withdrawals from the
Custodial Account of amounts on deposit therein pursuant to Section 3.02 that
are attributable to the Mortgage Loans for the following purposes:
(a) on each Determination Date, the Servicer shall determine the aggregate
amounts to be withdrawn from the Custodial Account and applied
pursuant to Section 3.05(a) of the Indenture and, prior to close
of business on the Business Day prior to the related Payment Date
(provided, however, that the Indenture Trustee shall not be
required to invest any amounts deposited into the Note Payment
Account after 1:00 p.m.), shall withdraw such amounts from the
Custodial Account and deposit such amounts into the Note Payment
Account, Funding Account or Reserve Sub-Account, as applicable,
to be distributed by the Paying Agent in accordance with and in
the order or priority set forth in Section 3.05(a) of the
Indenture for such Payment Date, in accordance with the Servicing
Certificate;
(b) to pay to itself any monthly payments received from the Mortgagors, the
amount of such payment that represents interest accrued on the
related Mortgage Loan for any period prior to the Cut-Off Date;
prior to the commencement of the Rapid Amortization Period, from
Principal Collections on the Mortgage Loans, and, if Principal
Collections are not sufficient, from Excess Spread, to pay to
_________ the amount of any Additional Balances as and when
created during the related Collection Period, and, prior to the
commencement of the Managed Amortization Period, to pay to the
related Seller the Purchase Price of any Subsequent Mortgage
Loans on the related Subsequent Transfer Date;
(c) to the extent deposited to the Custodial Account, to reimburse itself
or the related Subservicer for previously unreimbursed expenses
incurred in maintaining individual insurance policies pursuant to
Section 3.04, or Liquidation Expenses, paid pursuant to Section
3.07 or otherwise reimbursable pursuant to the terms of this
Agreement (to the extent not payable pursuant to Section 3.09),
such withdrawal right being limited to amounts received on
particular Mortgage Loans (other than any Repurchase Price in
respect thereof) that represent late recoveries of the payments
for which such advances were made, or from related Net
Liquidation Proceeds or the proceeds of the purchase of such
Mortgage Loan;
(d) to pay to itself out of each payment received on account of interest on
a Mortgage Loan as contemplated by Section 3.09, an amount equal
to the related Servicing Fee and the Recovery Fee (to the extent
not retained pursuant to Section 3.02 or 3.07), and to pay to any
Subservicer any subservicing fees not previously withheld by such
Subservicer;
(e) to the extent deposited in the Custodial Account, to pay to itself as
additional servicing compensation any (i) interest or investment
income earned on funds deposited in the Custodial Account that it
is entitled to withdraw pursuant to Sections 3.02(b) and 5.01,
and (ii) Foreclosure Profits (to the extent permitted by law);
(f) to pay to itself or a Seller, with respect to any Mortgage Loan or
property acquired in respect thereof that has been purchased or
otherwise transferred to such Seller, the Servicer or other
entity, all amounts received thereon and not required to be
distributed to Securityholders as of the date on which the
related Purchase Price or Repurchase Price is determined;
(g) to withdraw any other amount deposited in the Custodial Account that
was not required to be deposited therein pursuant to Section 3.02;
(h) to pay to itself, with respect to any Mortgage Loan for which it has
made a Servicer Advance of delinquent principal or interest, any
previously unreimbursed Servicer Advances of such amounts
theretofore made to the extent of receipts of late recoveries of
such payments from the related Mortgagors, out of related Net
Liquidation Proceeds or the proceeds of the purchase of such
Mortgage Loans;
(i) to reimburse itself for the amount of any investment earnings advanced
prior to maturity pursuant to Section 5.01, to the extent not
reimbursed from earnings received on the related investment at
maturity;
(j) at its option, for so long as it is the sole Certificateholder, to pay
to itself from amounts otherwise required to be remitted to the
Distribution Account in accordance with Section 3.05(a)(xvi) of
the Indenture, all amounts payable to it as a Certificateholder
on the related Payment Date, and
(k) to reimburse itself for Servicer Advances of delinquent principal or
interest on a Mortgage Loan or other advances that are made
pursuant to this Agreement that are not reimbursed pursuant to
clauses (c) or (h) of this Section 3.03.
Since, in connection with withdrawals pursuant to clauses (c), (d),
(e), (f) and (h), the Servicer's entitlement thereto is limited to
collections or other recoveries on the related Mortgage Loan, the Servicer
shall keep and maintain separate accounting, on a Mortgage Loan by Mortgage
Loan basis, for the purpose of justifying any withdrawal from the Custodial
Account pursuant to such clauses. Notwithstanding any other provision of
this Agreement, the Servicer shall be entitled to reimburse itself for any
previously unreimbursed expenses incurred pursuant to Section 3.07 or
otherwise reimbursable pursuant to the terms of this Agreement that the
Servicer determines to be otherwise nonrecoverable (except with respect to
any Mortgage Loan as to which the Repurchase Price has been paid), by
withdrawal from the Custodial Account of amounts on deposit therein
attributable to the Mortgage Loans on any Business Day prior to the Payment
Date succeeding the date of such determination.
Section 3.04 Maintenance of Hazard Insurance; Property Protection
Expenses. To the extent permitted under the related Loan Agreement and
Mortgage, and to the extent the Servicer receives notice that a hazard
insurance policy has been cancelled, the Servicer shall cause to be
maintained for each Mortgage Loan hazard insurance naming the Servicer or
related Subservicer as loss payee thereunder providing extended coverage in
an amount which is at least equal to the lesser of (i) the maximum insurable
value of the improvements securing such Mortgage Loan from time to time or
(ii) the combined principal balance owing on such Mortgage Loan and any
mortgage loan senior to such Mortgage Loan from time to time; provided,
however, that such coverage may not be less than the minimum amount required
to fully compensate for any loss or damage on a replacement cost basis. The
Servicer shall use its best efforts to monitor that hazard insurance is
maintained as described in the previous sentence in the same manner as it
would for mortgage loans in its own portfolio. The Servicer shall also cause
to be maintained on property acquired upon foreclosure, or deed in lieu of
foreclosure, of any Mortgage Loan, fire insurance with extended coverage in
an amount which is at least equal to the amount necessary to avoid the
application of any co-insurance clause contained in the related hazard
insurance policy. Amounts collected by the Servicer under any such policies
(other than amounts to be applied to the restoration or repair of the related
Mortgaged Property or property thus acquired or amounts released to the
Mortgagor in accordance with the Servicer's normal servicing procedures)
shall be deposited in the Custodial Account to the extent called for by
Section 3.02. In cases in which any Mortgaged Property is located at any
time during the life of a Mortgage Loan in a federally designated flood area,
to the extent permitted under the related Loan Agreement and Mortgage, and to
the extent the Servicer receives notice that the related flood insurance has
been cancelled, the hazard insurance to be maintained for the related
Mortgage Loan shall include flood insurance (to the extent available). All
such flood insurance shall be in amounts equal to the lesser of (i) the
amount required to compensate for any loss or damage to the related Mortgaged
Property on a replacement cost basis and (ii) the maximum amount of such
insurance available for such Mortgaged Property under the national flood
insurance program (assuming that the area in which such Mortgaged Property is
located is participating in such program). The Servicer shall use its best
efforts to monitor such flood insurance as described in the previous sentence
in the same manner as it would for mortgage loans in its own portfolio. The
Servicer shall be under no obligation to require that any Mortgagor maintain
earthquake or other additional insurance and shall be under no obligation
itself to maintain any such additional insurance on property acquired in
respect of a Mortgage Loan, other than pursuant to such applicable laws and
regulations as shall at any time be in force and as shall require such
additional insurance. If the Servicer shall obtain and maintain a blanket
policy consistent with its general mortgage servicing activities insuring
against hazard losses on all of the Mortgage Loans, it shall conclusively be
deemed to have satisfied its obligations as set forth in the first sentence
of this Section 3.04, it being understood and agreed that such policy may
contain a deductible clause, in which case the Servicer shall, in the event
that there shall not have been maintained on the related Mortgaged Property a
policy complying with the first sentence of this Section 3.04 and there shall
have been a loss which would have been covered by such policy, deposit in the
Custodial Account the amount not otherwise payable under the blanket policy
because of such deductible clause. Any such deposit by the Servicer shall be
made on the last Business Day of the Collection Period in the month in which
payments under any such policy would have been deposited in the Custodial
Account. In connection with its activities as servicer of the Mortgage
Loans, the Servicer agrees to present, on behalf of itself, the Issuer and
the Indenture Trustee, claims under any such blanket policy.
Section 3.05 Modification Agreements. The Servicer or the related
Subservicer, as the case may be, shall be entitled to (a) execute assumption
agreements, substitution agreements, and instruments of satisfaction or
cancellation or of partial or full release or discharge, or any other
document contemplated by this Agreement and other comparable instruments with
respect to the Mortgage Loans and with respect to the related Mortgaged
Properties (and the Issuer and the Indenture Trustee each shall promptly
execute any such documents on request of the Servicer) and (b) approve the
granting of an easement thereon in favor of another Person, any alteration or
demolition of such Mortgaged Properties or other similar matters, if it has
determined, exercising its good faith business judgment in the same manner as
it would if it were the owner of the related Mortgage Loans, that the
security for, and the timely and full collectability of, such Mortgage Loans
would not be adversely affected thereby. A partial release pursuant to this
Section 3.05 shall be permitted only if the CLTV for the related Mortgage
Loan after such partial release does not exceed the CLTV for such Mortgage
Loan as of the related Cut-Off Date. Any fee collected by the Servicer or
the related Subservicer for processing such request will be retained by the
Servicer or such Subservicer as additional servicing compensation.
Section 3.06 Trust Estate; Related Documents.
(a) When required by the provisions of this Agreement, the Issuer or the
Indenture Trustee shall execute instruments to release property
from the terms of the Trust Agreement, Indenture or Custodial
Agreement, as applicable, or convey the Issuer's or the Indenture
Trustee's interest in the same, in a manner and under
circumstances that are not inconsistent with the provisions of
this Agreement. No party relying upon an instrument executed by
the Issuer or the Indenture Trustee as provided in this Section
3.06 shall be bound to ascertain the Issuer's or the Indenture
Trustee's authority, inquire into the satisfaction of any
conditions precedent or see to the application of any moneys.
(b) If from time to time any written assurance, assumption agreement or
substitution agreement or other similar agreement shall be
executed pursuant to Section 3.05, the Servicer shall check that
each of such documents purports to be an original executed copy
(or a copy of the original executed document if the original
executed copy has been submitted for recording and has not yet
been returned) and, if so, shall file such documents, and upon
receipt of the original executed copy from the applicable
recording office or receipt of a copy thereof certified by the
applicable recording office shall file such originals or
certified copies, with the Related Documents held by the
Servicer.
(c) Upon receipt of a Request for Release from the Servicer, substantially
in the form of Exhibit C hereto, to the effect that a Mortgage
Loan has been the subject of a final payment or a prepayment in
full and such Mortgage Loan has been terminated or that
substantially all Net Liquidation Proceeds that have been
determined by the Servicer in its reasonable judgment to be
finally recoverable have been recovered, and upon deposit to the
Custodial Account of such final monthly payment, prepayment in
full together with accrued and unpaid interest to the date of
such payment with respect to such Mortgage Loan or, if
applicable, Net Liquidation Proceeds, the Custodian shall
promptly release the Related Documents held by the Custodian to
the Servicer. The Indenture Trustee shall execute such Related
Documents, along with such documents as the Servicer or the
related Mortgagor may request to evidence satisfaction and
discharge of such Mortgage Loan, upon request of the Servicer.
If from time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, the Servicer requests the
Custodian to release the Related Documents held by the Custodian
and delivers to the Custodian a trust receipt reasonably
satisfactory to the Custodian and signed by a Responsible Officer
of the Servicer, the Custodian shall release such Related
Documents to the Servicer. If such Mortgage Loans shall be
liquidated and the Custodian receives a certificate from the
Servicer as provided above, then, upon request of the Servicer,
the Custodian shall release the trust receipt to the Servicer.
Section 3.07 Realization Upon Defaulted Mortgage Loans. With respect to
any Mortgage Loan that comes into and continues in default, the Servicer
shall decide whether to (i) foreclose upon the related Mortgaged Property,
(ii) write off the unpaid Principal Balance thereof as bad debt, (iii) take a
deed in lieu of foreclosure, (iv) accept a short sale (a payoff of the
Mortgage Loan for an amount less than the total amount contractually owed in
order to facilitate a sale of the Mortgaged Property by the Mortgagor), (v)
permit a short refinancing (a payoff of the Mortgage Loan for an amount less
than the total amount contractually owed in order to facilitate refinancing
transactions by the Mortgagor not involving a sale of the Mortgaged
Property), (vi) arrange for a repayment plan, (vii) agree to a modification
in accordance with this Agreement or (viii) take an unsecured note in each
case subject to the rights of any related first Lien holder; provided, that
in connection with the foregoing, if the Servicer has actual knowledge that
any Mortgaged Property is affected by hazardous or toxic wastes or substances
and that the acquisition of such Mortgaged Property would not be commercially
reasonable, then the Servicer shall not cause the Issuer or the Indenture
Trustee to acquire title to such Mortgaged Property in a foreclosure or
similar proceeding. In connection with such decision, the Servicer shall
follow such practices (including, in the case of any default on a related
senior mortgage loan, the advancing of funds to correct such default if
deemed to be appropriate by the Servicer) and procedures as it shall deem
necessary or advisable and as shall be normal and usual in its general
mortgage servicing activities and as shall be required or permitted by the
Program Guide; provided, that the Servicer shall not be liable in any respect
hereunder if the Servicer is acting in connection with any such foreclosure
or attempted foreclosure which is not completed or other conversion in a
manner that is consistent with the provisions of this Agreement. The
foregoing is subject to the proviso that the Servicer shall not be required
to expend its own funds in connection with any foreclosure or attempted
foreclosure which is not completed or towards the correction of any default
on a related senior mortgage loan or restoration of any property unless it
shall determine that such expenditure will increase the related Net
Liquidation Proceeds. In the event of a determination by the Servicer that
any such expenditure previously made pursuant to this Section 3.07 will not
be reimbursable from Net Liquidation Proceeds, the Servicer shall be entitled
to reimbursement of its funds so expended pursuant to Section 3.03.
Notwithstanding any provision of this Agreement, a Mortgage Loan may be
deemed to be finally liquidated if substantially all amounts expected by the
Servicer to be received in connection therewith have been received; provided,
however, that the Servicer may continue to pursue recovery of such Mortgage
Loan and any Recovery Amount with respect to any such Mortgage Loan shall be
deposited into the Custodial Account. If the Servicer continues to pursue
recovery, the Servicer shall be entitled to the Recovery Fee with respect to
that Mortgage Loan and to be reimbursed for any Servicer Advances and
expenses from Recovery Amounts with respect to such Mortgage Loan as though
such Mortgage Loan continued to be an Outstanding Mortgage Loan hereunder.
For purposes of determining the amount of any Net Liquidation Proceeds,
Insurance Proceeds or other unscheduled collections, the Servicer may take
into account minimal amounts of additional receipts expected to be received
or any estimated additional liquidation expenses expected to be incurred in
connection with such Mortgage Loan.
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 issued to the Indenture Trustee, which shall hold the same on
behalf of the Issuer in accordance with Section 3.13 of the Indenture.
Notwithstanding any such acquisition of title and cancellation of the related
Mortgage Loan, such Mortgaged Property shall (except as otherwise expressly
provided herein) be considered to be an outstanding Mortgage Loan held as an
asset of the Issuer until such time as such property shall be sold.
Consistent with the foregoing for purposes of all calculations hereunder, so
long as the related Mortgage Loan shall be considered to be an outstanding
Mortgage Loan, it shall be assumed that, notwithstanding that the
indebtedness evidenced by the related Loan Agreement shall have been
discharged, such Loan Agreement in effect at the time of any such acquisition
of title before any adjustment thereto by reason of any bankruptcy or similar
proceeding or any moratorium or similar waiver or grace period will remain in
effect.
Any proceeds from foreclosure proceedings or the purchase or repurchase
of any Mortgage Loan pursuant to the terms of this Agreement, as well as any
recovery resulting from a collection of Net Liquidation Proceeds or Insurance
Proceeds, shall be applied in the following order of priority: first, to
reimburse the Servicer or the related Subservicer in accordance with this
Section 3.07; second, to pay the Servicer or the related Subservicer all
Servicing Fees payable therefrom; third, to pay accrued and unpaid interest
on such Mortgage Loan, at the Net Loan Rate to the Payment Date on which such
amounts are to be deposited in the Note Payment Account or Distribution
Account; and fourth, as a recovery of principal on such Mortgage Loan. Any
remaining amount shall constitute Foreclosure Profits.
Section 3.08 Issuer and Indenture Trustee to Cooperate. On or before
each Payment Date, the Servicer will notify the Indenture Trustee or the
Custodian, with a copy to the Issuer, of the termination of or the payment in
full and the termination of any Mortgage Loan during the preceding Collection
Period. Upon receipt of payment in full, the Servicer is authorized to
execute, pursuant to the authorization contained in Section 3.01, an
instrument of satisfaction regarding the related Mortgage, which instrument
of satisfaction shall be recorded by the Servicer if required by applicable
law and be delivered to the Person entitled thereto and to cause the removal
from the registration on the MERS® System of such Mortgage. It is understood
and agreed that any expenses incurred in connection with such instrument of
satisfaction or transfer shall be reimbursed from amounts deposited in the
Custodial Account. From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, the Custodian shall, upon request of the
Servicer and delivery to the Custodian, with a copy to the Issuer, of a
Request for Release, in the form attached hereto as Exhibit C, signed by a
Servicing Officer, release or cause to be released the related Loan Agreement
to the Servicer. The Issuer or Indenture Trustee shall promptly execute such
documents, in the forms provided by the Servicer, as shall be necessary for
the prosecution of any such proceedings or the taking of other servicing
actions. Such trust receipt shall obligate the Servicer to return such Loan
Agreement to the Custodian (as specified in such receipt) when the need
therefor by the Servicer no longer exists, unless the Mortgage Loan shall be
liquidated, in which case, upon receipt of a certificate of a Servicing
Officer similar to that specified above, such trust receipt shall be released
to the Servicer.
In order to facilitate the foreclosure of the Mortgage securing any
Mortgage Loan that is in default following recordation of the related
Assignment of Mortgage in accordance with the provisions of the Purchase
Agreement, the Indenture Trustee or the Issuer shall, if so requested in
writing by the Servicer, promptly execute an appropriate assignment in the
form provided by the Servicer to assign such Mortgage Loan for the purpose of
collection to the Servicer (any such assignment shall unambiguously indicate
that the assignment is for the purpose of collection only), and, upon such
assignment, such assignee for collection will thereupon bring all required
actions in its own name and otherwise enforce the terms of such Mortgage Loan
and deposit or credit the Net Liquidation Proceeds, exclusive of Foreclosure
Profits, received with respect thereto into the Custodial Account. In the
event that all delinquent payments due under any such Mortgage Loan are paid
by the Mortgagor and any other defaults are cured, then the assignee for
collection shall promptly reassign such Mortgage Loan to the Indenture
Trustee and return all Related Documents to the place where the related
Mortgage File was being maintained.
In connection with the Issuer's obligation to cooperate as provided in
this Section 3.08 and all other provisions of this Agreement requiring the
Issuer to authorize or permit any actions to be taken with respect to the
Mortgage Loans, the Indenture Trustee, as pledgee of the Mortgage Loans and
as assignee of record of the Mortgage Loans on behalf of the Issuer pursuant
to Section 3.13 of the Indenture, expressly agrees, on behalf of the Issuer,
to take all such actions on behalf of the Issuer and to promptly execute and
return all instruments reasonably required by the Servicer in connection
therewith; provided, that if the Servicer requests a signature of the
Indenture Trustee, on behalf of the Issuer, then the Servicer shall deliver
to the Indenture Trustee an Officer's Certificate stating that such signature
is necessary or appropriate to enable the Servicer to carry out its servicing
and administrative duties under this Agreement.
Section 3.09 Servicing Compensation; Payment of Certain Expenses by
Servicer. The Servicer shall be entitled to receive the Servicing Fee in
accordance with Section 3.03 as compensation for its services in connection
with servicing the Mortgage Loans. Moreover, late payment charges and other
receipts not required to be deposited in the Custodial Account as specified
in Section 3.02 shall be retained by the Servicer as additional servicing
compensation. The Servicer shall be required to pay all expenses incurred by
it in connection with its activities hereunder (including payment of all
other fees and expenses not expressly stated hereunder to be for the account
of the Securityholders), including the fees and expenses of the Owner
Trustee, Indenture Trustee and the Custodian, and shall not be entitled to
reimbursement therefor.
Section 3.10 Annual Statement as to Compliance. The Servicer will
deliver to RAMP and the Indenture Trustee on or before the earlier of
(a) March 31 of each year or (b) with respect to any calendar year during
which RAMP's annual report on Form 10-K is required to be filed in accordance
with the Exchange Act and the rules and regulations of the Commission, the
date on which the annual report on Form 10-K is required to be filed in
accordance with the Exchange Act and the rules and regulations of the
Commission, a servicer compliance certificate, signed by an authorized
officer of the Servicer, as described in Item 1123 of Regulation AB, to the
effect that:
(i) A review of the Servicer's activities during the reporting
period and of its performance under this Agreement has been made under
such officer's supervision.
(ii) To the best of such officer's knowledge, based on such
review, the Servicer has fulfilled all of its obligations under this
Agreement in all materials respects throughout the reporting period or,
if there has been a failure to fulfill any such obligation in any
material respect, specifying each such failure known to such officer
and the nature and status thereof.
The Servicer shall use commercially reasonable efforts to obtain from
all other parties participating in the servicing function any additional
certifications required under Item 1123 of Regulation AB to the extent
required to be included in a Report on Form 10-K; provided, however, that a
failure to obtain such certifications shall not be a breach of the Servicer's
duties hereunder if any such party fails to deliver such a certification.
Section 3.11 Annual Servicing Report. On or before the earlier of
(a) March 31 of each year or (b) with respect to any calendar year during
which RAMP's annual report on Form 10-K is required to be filed in accordance
with the Exchange Act and the rules and regulations of the Commission, the
date on which the annual report is required to be filed in accordance with
the Exchange Act and the rules and regulations of the Commission, the
Servicer at its expense shall cause a firm of independent public accountants,
which shall be members of the American Institute of Certified Public
Accountants, to furnish a report to RAMP and the Indenture Trustee the
attestation required under Item 1122(b) of Regulation AB. In rendering such
statement, such firm may rely, as to matters relating to the direct servicing
of mortgage loans by Subservicers, upon comparable statements for
examinations conducted by independent public accountants substantially in
accordance with standards established by the American Institute of Certified
Public Accountants (rendered within one year of such statement) with respect
to such Subservicers..
Section 3.12 Access to Certain Documentation and Information Regarding
the Mortgage Loans. Whenever required by statute or regulation, the Servicer
shall provide to the Enhancer, any Securityholder upon reasonable request (or
a regulator for a Securityholder) or the Indenture Trustee, reasonable access
to the documentation regarding the Mortgage Loans. Such access shall be
afforded without charge, but only upon reasonable request and during normal
business hours at the offices of the Servicer. Nothing in this Section 3.12
shall derogate from the obligation of the Servicer to observe any applicable
law prohibiting disclosure of information regarding Mortgagors, and the
failure of the Servicer to provide access as provided in this Section 3.12 as
a result of such obligation shall not constitute a breach of this Section
3.12.
Section 3.13 Maintenance of Certain Servicing Insurance Policies. The
Servicer shall, during the term of its service as servicer, maintain in force
and effect (i) a policy or policies of insurance covering errors and
omissions in the performance of its obligations as Servicer hereunder and
(ii) a fidelity bond in respect of its officers, employees or agents. Each
such policy or policies and fidelity bond shall be at least equal to the
coverage that would be required by ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac, whichever is
greater, for Persons performing servicing for mortgage loans purchased by
such entity.
Section 3.14 Information Required by the Internal Revenue Service and
Reports of Foreclosures and Abandonments of Mortgaged Property. The Servicer
shall prepare and deliver all federal and state information reports with
respect to the Mortgage Loans when and as required by all applicable state
and federal income tax laws. In particular, with respect to the requirement
under Section 6050J of the Code to the effect that the Servicer or
Subservicer shall make reports of foreclosures and abandonments of any
mortgaged property for each year beginning in [ ], the Servicer or
Subservicer shall file reports relating to each instance occurring during the
previous calendar year in which the Servicer (a) on behalf of the Issuer,
acquired an interest in any Mortgaged Property through foreclosure or other
comparable conversion in full or partial satisfaction of a Mortgage Loan, or
(b) knew or had reason to know that any Mortgaged Property had been
abandoned. The reports from the Servicer or Subservicer shall be in form and
substance sufficient to meet the reporting requirements imposed by Section
6050J and Section 6050H (reports relating to mortgage interest received) of
the Code.
Section 3.15 Optional Repurchase or Transfer of Mortgage Loans.
(a) Notwithstanding any provision in Section 3.07 to the contrary, the
Servicer, at its option and in its sole discretion, may
repurchase any Mortgage Loan that is delinquent in payment by a
period of ninety (90) days or longer for a price equal to the
Repurchase Price, provided that any such repurchase shall occur
only during the 60-day period commencing on the first day of the
next calendar month.
(b) The Servicer shall repurchase any Mortgage Loan for a price equal to
the Repurchase Price (i) if the related Mortgage did not have a
Lien senior to it as of the related Cut-Off Date, and, at the
request of the related Mortgagor, the Servicer at its option and
in its sole discretion agrees to the placement of a Lien on the
related Mortgaged Property senior to that of such Mortgage or
(ii) at the request of the Mortgagor, the Servicer at its option
and in its sole discretion agrees to an increase in the Credit
Limit above the Credit Limit of such Mortgage Loan as of the
related Cut-Off Date or (iii) at the request of the Mortgagor,
the Servicer at its option and in its sole discretion agrees to
the refinancing of the Lien senior to that of the related
Mortgage resulting in a CLTV that does not satisfy the conditions
set forth in Section 3.01(a) herein.
(c) Subject to the conditions set forth below, the Servicer, upon receipt
of written notice and direction from the Issuer, shall cause the
retransfer of Mortgage Loans from the Trust Estate to the Issuer
as of the close of business on a Payment Date (the "Transfer
Date"). On the fifth Business Day (the "Transfer Notice Date")
prior to the Transfer Date designated in such notice, the
Servicer shall give the Indenture Trustee, the Rating Agencies
and the Enhancer a notice of the proposed retransfer that
contains a list of the Mortgage Loans to be retransferred. Such
retransfers of Mortgage Loans shall be permitted upon
satisfaction of the following conditions:
(i) No Rapid Amortization Event has occurred;
(ii) On the Transfer Date, the Overcollateralization Amount (after giving
effect to the removal from the Trust Estate of the Mortgage Loans
proposed to be retransferred) will equal or exceed the
Overcollateralization Target Amount;
(iii) The retransfer of any Mortgage Loans on any Transfer Date during the
Managed Amortization Period shall not, in the reasonable belief of the
Servicer, cause a Rapid Amortization Event to occur or an event which
with notice or lapse of time or both would constitute a Rapid
Amortization Event;
(iv) On or before the Transfer Date, the Servicer shall have delivered to
the Indenture Trustee a revised Mortgage Loan Schedule showing that the
Mortgages Loans transferred to the Certificateholders are no longer
owned by the Trust Estate;
(v) The Servicer shall represent and warrant that the Mortgage Loans to be
removed from the Trust Estate were selected at random and the Servicer
shall have received the consent of the Enhancer as to the selection of
the particular Mortgage Loans to be removed; and
(vi) The Servicer shall have delivered to the Indenture Trustee and the
Enhancer an officer's certificate certifying that the items set forth
in subparagraphs (i) through (v), inclusive, have been performed or are
true and correct, as the case may be. The Indenture Trustee may
conclusively rely on such officer's certificate, shall have no duty to
make inquiries with regard to the matters set forth therein and shall
incur no liability in so relying.
The Servicer shall not be permitted to effect the retransfer of any
Mortgage Loan except under the conditions specified above. Upon receiving
the requisite notice and direction from the Issuer, the Servicer shall
perform in a timely manner those acts required of it, as specified above.
Upon satisfaction of the above conditions, on the Transfer Date the Indenture
Trustee shall deliver, or cause to be delivered, to the Issuer a written
itemization of each Mortgage Loan being transferred, together with the
Mortgage File for each such Mortgage Loan, and the Indenture Trustee shall
execute and deliver to the Issuer or its designee such other documents
prepared by the Servicer as shall be reasonably necessary to transfer such
Mortgage Loans to the Certificateholders. Any such transfer of the Trust
Estate's right, title and interest in and to Mortgage Loans shall be without
recourse, representation or warranty by or of the Indenture Trustee or the
Trust Estate to the Issuer or its designee.
Section 3.16 Funding Account.
(a) No later than the Closing Date, the Indenture Trustee shall establish
and maintain on behalf of itself one or more segregated trust
accounts, which shall be Eligible Accounts, titled "Funding
Account, _________________, as Indenture Trustee for Home Equity
Loan Trust [ ]-[ ]" (the "Funding Account"). The Indenture
Trustee shall establish within the Funding Account a sub-account,
titled "Reserve Sub-Account," as set forth in Section 3.17 of
this Agreement. On each Payment Date during the Revolving
Period, the Servicer shall withdraw from the Custodial Account
and deposit into the Funding Account (but not the Reserve
Sub-Account) the aggregate amount of Principal Collections
remaining after the purchase of all Additional Balances or
Subsequent Mortgage Loans on or prior to such Payment Date.
(b) The Servicer may cause the institution maintaining the Funding Account
to invest any funds therein in Permitted Investments having a
maturity of up to 90 days or maturing or otherwise available not
later than the Business Day preceding the related Payment Date on
which funds are scheduled to be withdrawn to purchase Subsequent
Mortgage Loans; provided, that any investment in an obligation of
the institution with which the Funding Account is maintained may
mature on or before 10:30 a.m., New York time, on such Payment
Date; and provided further, that no such investment may be sold
or disposed of prior to maturity. In addition, no such Permitted
Investment shall be purchased at a price in excess of par. At
any time when the Indenture Trustee is maintaining the Funding
Account, any request by the Servicer to invest funds on deposit
therein shall be in writing, delivered to the Indenture Trustee
at or before 10:30 a.m., New York time, if such investment is to
be made on such day. The Servicer shall certify that the
requested investment is a Permitted Investment maturing at or
prior to the time required hereby. Any such investment shall be
registered in the name of the Indenture Trustee or its nominee,
and to the extent that any such investment is certificated, such
investment shall be maintained with the Indenture Trustee at its
Corporate Trust Office. All net income or other gain received
from any such investment shall be deposited into or credited to
the Note Payment Account.
(c) From time to time withdrawals shall be made from the Funding Account by
the Servicer as follows:
(i) on each Payment Date during the Revolving Period, any amounts on
deposit in the Funding Account, including Excess Spread, shall be
withdrawn and applied, to the extent available, in the following order:
(A) to _____________, as payment for Additional Balances, if any, in an
amount equal to (1) the aggregate of all Draws during the related
Collection Period or (2) if the Servicer has applied amounts on
deposit in the Custodial Account representing Principal
Collections received during such Collection Period to the
purchase of Additional Balances, the excess, if any, of the
aggregate of all Draws during the related Collection Period over
Principal Collections for such Collection Period; and
(B) to each Seller, as payment for Subsequent Mortgage Loans, if any, in an
amount equal to (1) the aggregate Principal Balance of all such
Subsequent Mortgage Loans purchased from such Seller during the
related Collection Period or (2) if the Servicer has applied
amounts on deposit in the Custodial Account representing
Principal Collections for such Collection Period toward the
purchase of Subsequent Mortgage Loans, the excess, if any, of the
aggregate Principal Balance of all such Subsequent Mortgage Loans
purchased from such Seller over such Principal Collections;
(ii) on the last Payment Date during the Revolving Period, any amounts
remaining on deposit in the Funding Account, if any, after giving
effect to clause (i) above, shall be deposited into the Note Payment
Account for payment to the Noteholders pursuant to Section 3.05 of the
Indenture.
Section 3.17 Reserve Sub-Account.
(a) On or after the Closing Date, the Indenture Trustee shall establish and
maintain a sub-account within the Funding Account (the "Reserve
Sub-Account"). On each Business Day following each Determination
Date, the Servicer, in accordance with the requirements of
Sections 3.05(a), 3.05(b) and 3.05(c) of the Indenture, shall
determine the amount, if any, to be withdrawn from the Custodial
Account and deposited into the Reserve Sub-Account. From time to
time withdrawals shall be made from the Reserve Sub-Account by
the Indenture Trustee in the amounts and for the purposes set
forth in Sections 3.05(a), 3.05(b) and 3.05(c) of the Indenture.
In addition, if a Funding Event has occurred during the Managed
Amortization Period, any amount in the Reserve Sub-Account may be
applied to purchase Subsequent Mortgage Loans in the manner set
forth in the Purchase Agreement. Funds on deposit in the Reserve
Sub-Account may be invested in Permitted Investments in
accordance with Section 3.16(b) hereof.
Section 3.18 [Pre-Funding Account.
(a) No later than the Closing Date, the Indenture Trustee shall
establish and maintain on behalf of itself one or more segregated trust
accounts, which shall be Eligible Accounts, titled "Pre-Funding Account,
_____________, as Indenture Trustee for Home Equity Loan Trust [ ]-[ ]"
(the "Pre-Funding Account"). On the Closing Date, __________ shall deposit
into the Pre-Funding Account an amount equal to the Original Pre-Funded
Amount from the proceeds of the sale of the Securities. On each Subsequent
Transfer Date, the Servicer shall instruct the Indenture Trustee in writing
to withdraw from the Pre-Funding Account an amount equal to the aggregate
Principal Balance as of the related Subsequent Cut-Off Date of the Subsequent
Mortgage Loans to be sold to the Trust on such Subsequent Transfer Date and
purchased with funds on deposit in the Pre-Funding Account, and to pay such
amount to or upon the order of ______________ upon satisfaction of the
conditions set forth in this Agreement, in the Purchase Agreement and in the
related Subsequent Transfer Agreement with respect thereto.
(b) If the Pre-Funded Amount has not been reduced to zero at the
close of business on the last day of the Pre-Funding Period, after giving
effect to any withdrawal therefrom on such day, any remaining Pre-Funded
Amount shall be deposited in the Note Payment Account and applied as a
principal distribution on the Notes on the next succeeding Payment Date in
accordance with the terms of the Indenture; provided that up to $50,000 of
such amount may be deposited in the Funding Account.
(c) The Servicer may cause the institution maintaining the
Pre-Funding Account to invest any funds therein in Permitted Investments
having a maturity of up to 90 days or maturing or otherwise available not
later than the Business Day preceding the related Payment Date on which funds
are scheduled to be withdrawn to purchase Subsequent Mortgage Loans;
provided, that any investment in an obligation of the institution with which
the Pre-Funding Account is maintained may mature on or before 10:30 a.m., New
York time, on such Payment Date; and provided further, that no such
investment may be sold or disposed of prior to maturity. In addition, no
such Permitted Investment shall be purchased at a price in excess of par.
Notwithstanding the foregoing, in the event investment earnings have not
matured on any Payment Date, the amount of such earnings accrued as of such
Payment Date shall be advanced by the Servicer for deposit into the Note
Payment Account (which advance shall be reimbursed to the Servicer from such
investment earnings at maturity). At any time when the Indenture Trustee is
maintaining the Pre-Funding Account, any request by the Servicer to invest
funds on deposit therein shall be in writing, delivered to the Indenture
Trustee at or before 10:30 a.m., New York time, if such investment is to be
made on such day. The Servicer shall certify that the requested investment
is a Permitted Investment maturing at or prior to the time required hereby.
Any such investment shall be registered in the name of the Indenture Trustee
or its nominee, and to the extent that any such investment is certificated,
such investment shall be maintained with the Indenture Trustee at its
Corporate Trust Office. All net income or other gain received from any such
investment shall be deposited into or credited to the Note Payment Account,
and may be withdrawn therefrom in accordance with Section 3.05 of the
Indenture. The amount of any losses incurred in respect of the principal
amount of any such investments shall be deposited in the Pre-Funding Account
by the Servicer out of its own funds immediately as realized. In no event
shall the Indenture Trustee be liable for any investment losses on Permitted
Investments held in or credited to the Pre-Funding Account, provided that
such investments are made in accordance with the provisions of this Agreement
and the Indenture Trustee is not the obligor under the Permitted Investment.]
Section 3.19 [Capitalized Interest Account.
(a) No later than the Closing Date, the Indenture Trustee shall
establish and maintain on behalf of itself one or more segregated trust
accounts, which shall be Eligible Accounts, titled "Capitalized Interest
Account, _______________, as Indenture Trustee for Home Equity Loan Trust
[ ]-[ ]" (the "Capitalized Interest Account"). The Indenture Trustee
shall, promptly upon receipt, deposit in the Capitalized Interest Account and
retain therein the Interest Coverage Amount. If the Indenture Trustee shall
not have received an investment direction from ______________, the Indenture
Trustee shall invest funds on deposit in the Capitalized Interest Account in
Permitted Investments of the kind described in clause (v) of the definition
of Permitted Investments having a maturity date no later than the next
succeeding Payment Date. In addition, no such Permitted Investment shall be
purchased at a price in excess of par. The Servicer shall be entitled to
retain any investment earnings on amounts on deposit in the Capitalized
Interest Account and shall deposit into the Capitalized Interest Account the
amount of any net loss incurred in respect of any such Permitted Investment
immediately upon realization of such loss without any right of reimbursement
therefor. The Servicer shall be the owner of the Capitalized Interest
Account and shall report all items of income, deduction, gain or loss arising
therefrom.
(b) On each Payment Date during the Pre-Funding Period and on the
Payment Date immediately after the end of the Pre-Funding Period, the
Indenture Trustee, at the written direction of the Servicer, shall withdraw
from the Capitalized Interest Account and deposit into the Note Payment
Account an amount equal to the Capitalized Interest Requirement for such
Payment Date.
(c) In connection with each Subsequent Transfer Date occurring in the
Pre-Funding Period, the Servicer, at its option, may recalculate the Interest
Coverage Amount taking into account the amount remaining in the Pre-Funding
Account following the sale of Subsequent Mortgage Loans to the Trust on such
date. The recomputed Interest Coverage Amount shall be not less than the
amount necessary to cover the Capitalized Interest Requirement for each
remaining Payment Date in the Pre-Funding Period. On any such Subsequent
Transfer Date, ______________ shall instruct in writing the Indenture Trustee
to pay to it from funds in the Capitalized Interest Account the excess of the
amount on deposit therein over the recomputed Interest Coverage Amount.
(d) Upon the earlier of (i) termination of the Trust Agreement in
accordance with Section 8.01 thereof and (ii) the Payment Date following the
end of the Pre-Funding Period, any amount remaining on deposit in the
Capitalized Interest Account shall be withdrawn by the Indenture Trustee and
paid to ______________.]
Section 3.20 Enforcement of Due-on-Sale Clauses; Assumption and
Modification Agreements; Certain Assignments.
(a) When any Mortgaged Property is conveyed by the Mortgagor, the Servicer
or Subservicer, to the extent it has knowledge of such
conveyance, shall enforce any due-on-sale clause contained in any
Loan Agreement or Mortgage, to the extent permitted under
applicable law and governmental regulations, but only to the
extent that such enforcement will not adversely affect or
jeopardize coverage under any Required Insurance Policy.
Notwithstanding the foregoing:
(i) the Servicer shall not be deemed to be in default under this Section
3.20(a) by reason of any transfer or assumption which the Servicer is
restricted by law from preventing; and
(ii) if the Servicer determines that it is reasonably likely that any
Mortgagor will bring, or if any Mortgagor does bring, legal action to
declare invalid or otherwise avoid enforcement of a due-on-sale clause
contained in any Loan Agreement or Mortgage, the Servicer shall not be
required to enforce the due-on-sale clause or to contest such action.
(b) Subject to the Servicer's duty to enforce any due-on-sale clause to the
extent set forth in Section 3.20(a), in any case in which a
Mortgaged Property is to be conveyed to a Person by a Mortgagor,
and such Person is to enter into an assumption or modification
agreement or supplement to the Loan Agreement or Mortgage which
requires the signature of the Indenture Trustee, or if an
instrument of release signed by the Indenture Trustee is required
releasing the Mortgagor from liability on the Mortgage Loan, the
Servicer is authorized, subject to the requirements of the
sentence next following, to execute and deliver, on behalf of the
Indenture Trustee, the assumption agreement with the Person to
whom the Mortgaged Property is to be conveyed and such
modification agreement or supplement to the Loan Agreement or
Mortgage or other instruments as are reasonable or necessary to
carry out the terms of the Loan Agreement or Mortgage or
otherwise to comply with any applicable laws regarding
assumptions or the transfer of the Mortgaged Property to such
Person. The Servicer shall execute and deliver such documents
only if it reasonably determines that (i) its execution and
delivery thereof will not conflict with or violate any terms of
this Agreement or cause the unpaid balance and interest on the
Mortgage Loan to be uncollectible in whole or in part, (ii) any
required consents of insurers under any Required Insurance
Policies have been obtained and (iii) subsequent to the closing
of the transaction involving the assumption or transfer (A) such
transaction will not adversely affect the coverage under any
Required Insurance Policies, (B) the Mortgage Loan will fully
amortize over the remaining term thereof, (C) no material term of
the Mortgage Loan (including the interest rate on the Mortgage
Loan) will be altered nor will the term of the Mortgage Loan be
changed and (D) if the seller/transferor of the Mortgaged
Property is to be released from liability on the Mortgage Loan,
such release will not (based on the Servicer's or Subservicer's
good faith determination) adversely affect the collectability of
the Mortgage Loan. Upon receipt of appropriate instructions from
the Servicer in accordance with the foregoing, the Indenture
Trustee shall execute any necessary instruments for such
assumption or substitution of liability as directed in writing by
the Servicer. Upon the closing of the transactions contemplated
by such documents, the Servicer shall cause the originals or true
and correct copies of the assumption agreement, the release (if
any), or the modification or supplement to the Loan Agreement or
Mortgage to be delivered to the Indenture Trustee or the
Custodian and deposited with the Mortgage File for such Mortgage
Loan. Any fee collected by the Servicer or such related
Subservicer for entering into an assumption or substitution of
liability agreement will be retained by the Servicer or such
Subservicer as additional servicing compensation.
Section 3.21 Advance Facility.
(a) The Servicer is hereby authorized to enter into any facility (an
"Advance Facility") with any Person (any such Person, an "Advance
Facility Counterparty"), without the consent of any party to this
Agreement or the Enhancer, which provides that the Servicer may
pledge or sell its rights to receive reimbursement of any
advances made by the Servicer in respect of draws for HELOCs
("HELOC Advances") and any Servicer Advances pursuant to this
Agreement ("Advance Reimbursement Rights") pursuant to credit
facilities, repurchase facilities, or similar facilities
providing liquidity for the funding of the HELOC Advances and the
Servicer Advances. Notwithstanding the existence of any Advance
Facility, the Servicer shall remain obligated pursuant to this
Agreement to make any HELOC Advance or Servicer Advances as
required by this Agreement, and shall not be relieved of such
obligations by virtue of such Advance Facility.
(b) If the Servicer enters into an Advance Facility, and for so long as an
Advance Facility Counterparty remains entitled to receive
reimbursement for any Servicer Advances ("Advance Reimbursement
Amount"), then the Servicer shall identify such Advance
Reimbursement Amount as received, consistently with the
reimbursement rights set forth in Sections 3.03 of this
Agreement, and shall remit such Advance Reimbursement Amount in
accordance with the documentation establishing the Advance
Facility to such Advance Facility Counterparty or to a trustee,
agent or custodian (an "Advance Facility Trustee") designated by
such Advance Facility Counterparty. Notwithstanding the
foregoing, if so required pursuant to the terms of the Advance
Facility, the Servicer may withdraw from the Custodial Account or
direct the Indenture Trustee to withdraw, as applicable, and the
Servicer shall, or if so directed, the Indenture Trustee is
hereby authorized to and shall pay to the Advance Facility
Counterparty or the Advance Facility Trustee the Advance
Reimbursement Amount identified pursuant to the preceding
sentence.
(c) The Advance Reimbursement Amount shall consist solely of amounts in
respect of Servicer Advances made with respect to the Mortgage
Loans for which the Servicer would be permitted to reimburse
itself in accordance with this Agreement, assuming the Servicer
had made the related Servicer Advances. Any Advance
Reimbursement Amount that the Servicer, in its capacity as
Servicer, is entitled to be paid shall not be included in
distributions to Noteholders. An Advance Facility Counterparty
whose obligations are limited to the making of Servicer Advances
will not be deemed to be a Subservicer under this Agreement or be
required to meet the criteria for qualification as a Subservicer
under this Agreement.
(d) Any Advance Reimbursement Amount allocated to reimburse Servicer
Advances made with respect to any particular Mortgage Loan shall
be allocated to the reimbursement of the unreimbursed Servicer
Advances made with respect to that Mortgage Loan on a "first-in,
first out" ("FIFO") basis, such that the Advance Reimbursement
Amount shall be applied to reimburse the Servicer Advance for
that Mortgage Loan that was disbursed earliest in time first, and
to reimburse the Servicer Advance for that Mortgage Loan that was
disbursed latest in time, last. The Servicer shall provide to
the related Advance Facility Counterparty or Advance Facility
Trustee loan-by-loan information with respect to each Advance
Reimbursement Amount remitted to such Advance Facility
Counterparty or Advance Facility Trustee, to enable the Advance
Facility Counterparty or Advance Facility Trustee to make the
FIFO allocation of each such Advance Reimbursement Amount with
respect to each Mortgage Loan. HELOC Advances shall be
reimbursed as funds are received and available to be disbursed in
reimbursement for any HELOC Advance pursuant to the Basic
Documents. The Servicer shall provide to the related Advance
Facility Counterparty or Advance Facility Trustee loan-by-loan
information with respect to each HELOC Advance remitted to such
Advance Facility Counterparty or Advance Facility Trustee.
(e) Upon request of the Servicer, the Indenture Trustee agrees to execute
such acknowledgments, certificates, and other documents
recognizing the interests of any Advance Facility Counterparty in
such Advance Reimbursement Rights as the Servicer may cause to be
made subject to Advance Facilities pursuant to this Section 3.21.
ARTICLE IV
Servicing Certificate
Section 4.01 Statements to Securityholders.
(a) With respect to each Payment Date, on the Business Day following the
related Determination Date, the Servicer shall forward the
Servicing Certificate to the Indenture Trustee, and the Indenture
Trustee, pursuant to Section 3.26 of the Indenture, shall make
such Servicing Certificate available to each Certificateholder,
each Noteholder, RAMP, the Owner Trustee, the Certificate Paying
Agent, each Rating Agency and the Enhancer. The Servicing
Certificate shall set forth the following information as to the
Notes and Certificates, to the extent applicable:
(i) the aggregate amount of (a) Interest Collections, (b) Principal
Collections (and, with respect to any Payment Date relating to the
Managed Amortization Period, Net Principal Collections),
(c) Substitution Adjustment Amounts and (d) Excess Spread, for the
related Collection Period;
(ii) the amount of such distribution as principal to the Noteholders of each
Class of Notes;
(iii) the amount of such distribution as interest to the Noteholders of each
Class of Notes, the amount thereof, if any, payable in respect of
unpaid Interest Shortfalls, and the amount of any Interest Shortfalls
and Relief Act Shortfalls for the related Payment Date;
(iv) each Policy Draw Amount, if any, for such Payment Date and the
aggregate amount of prior draws on the Policy thereunder not yet
reimbursed;
(v) the amount of such distribution to the Certificateholders;
(vi) the amount of any Additional Balance Increase Amount payable to the
Certificateholders;
(vii) the aggregate Principal Balance of the Mortgage Loans as of the
beginning and as of the end of the related Collection Period;
(viii) the number and aggregate Principal Balances of Mortgage Loans
(a) as to which the Minimum Monthly Payment is delinquent for 30-59
days, 60-89 days, 90-119 days, 120-149 days, 150-179 days and greater
than 180 days, respectively, (b) the related Mortgaged Property of
which has been foreclosed upon and (c) as to which the related
Mortgaged Property has become REO Property, in each case as of the end
of the related Collection Period; provided, however, that such
information shall not be provided on the statements relating to the
first Payment Date;
(ix) the number and aggregate Principal Balance of Mortgage Loans
repurchased pursuant to Section 3.15(a) herein during the related
Collection Period;
(x) the Net WAC Rate for the related Collection Period;
(xi) prior to the second Determination Date following the commencement of
the Rapid Amortization Period, the aggregate amount of Additional
Balances created during the related Collection Period and conveyed to
the Issuer prior to the commencement of such Rapid Amortization Period;
(xii) the aggregate Liquidation Loss Amounts with respect to the related
Collection Period, the amount distributed as principal to Noteholders
or paid to the Funding Account in respect of Liquidation Loss Amounts
and the aggregate of the Liquidation Loss Amounts (minus any Subsequent
Net Recovery Amounts) from all Collection Periods to date expressed as
dollar amount and as a percentage of the aggregate Cut-Off Date
Principal Balances of the Mortgage Loans;
(xiii) the aggregate Note Balance of each Class of Notes and the
Certificate Balance of each Class of the Certificates after giving
effect to the distribution of principal on such Payment Date;
(xiv) the balance of the Pre-Funding Account, Capitalized Interest Account,
Funding Account and the Reserve Sub-Account as of the beginning and as
of the end of the related Collection Period;
(xv) the Percentage Interest applicable to each of the Securities, after
application of payments made on such Payment Date;
(xvi) the Overcollateralization Amount as of the end of the related
Collection Period and whether the Excess Spread Test is satisfied as of
the end of the related Collection Period;
(xvii) the aggregate Principal Balance of Subsequent Mortgage Loans
transferred to the Trust Estate during the related Collection Period;
(xviii) the applicable Record Date, Determination Date and Payment Date;
(xix) the aggregate amount of payments received with respect to the Mortgage
Loans including prepayment amounts;
(xx) the Servicing Fee payable to the Servicer;
(xxi) the amount of any other fees and expenses paid, and the identity of the
party receiving such fees or expenses;
(xxii) the amount, terms and general purpose of any Advance by the
Servicer pursuant to Section 3.02 hereof and the amount of all
Servicing Advances that have been reimbursed during the preceding
Collection Period; and
(xxiii) any material modifications, extensions or waivers to the terms of
the Mortgage Loans during the Collection Period or that have
cumulatively become material over time.
In the case of information furnished pursuant to clauses (ii) and (iii)
above, the amounts shall be expressed as an aggregate dollar amount per Note
or Certificate, as applicable, with a $25,000 denomination per Note and with
a denomination equal to a 100% Percentage Interest per Certificate.
If a Rapid Amortization Event or a Servicing Default shall occur, on
the Business Day following the related Determination Date, the Servicer shall
forward to the Indenture Trustee a statement to such effect, including the
nature of such Rapid Amortization Event or Servicing Default. Upon the
Servicer's becoming aware of any Early Amortization Event, the Servicer shall
forward to the Indenture Trustee a statement to such effect, including the
nature of such Early Amortization Event. The Indenture Trustee, pursuant to
Section 3.26 of the Indenture, shall deliver or cause to be delivered by mail
to each Certificateholder, each Noteholder, the Enhancer, RAMP, the Owner
Trustee, the Certificate Paying Agent and each Rating Agency, notice of such
Rapid Amortization Event, Early Amortization Event or Servicing Default,
including the nature thereof. Such statement may be included in, or separate
from, the regular statement made available to Securityholders.
The Indenture Trustee will make the Servicing Certificate (and, at its
option, any additional files containing the same information in an
alternative format) available each month to Securityholders, and other
parties to this Agreement via the Indenture Trustee's internet website. The
Indenture Trustee's internet website shall initially be located at
"▇▇▇.▇▇▇▇▇▇▇.▇▇▇." Assistance in using the website can be obtained by
calling the Indenture Trustee's customer service desk at (▇▇▇) ▇▇▇-▇▇▇▇.
Parties that are unable to use the above distribution options are entitled to
have a paper copy mailed to them via first class mail by calling the customer
service desk and indicating such. The Indenture Trustee shall have the right
to change the way the statements to Securityholders are distributed in order
to make such distribution more convenient or more accessible to the above
parties and the Indenture Trustee shall provide timely and adequate
notification to all above parties regarding any such changes. The Indenture
Trustee may require registration and the acceptance of a disclaimer in
connection with access to its website.
(b) The Servicer shall forward to the Indenture Trustee any other
information reasonably requested by the Indenture Trustee
necessary to make distributions pursuant to Section 3.05 of the
Indenture. Prior to the close of business on the Business Day
next succeeding each Determination Date, the Servicer shall
furnish a written statement to the Certificate Paying Agent and
the Indenture Trustee setting forth the aggregate amounts
required to be withdrawn from the Custodial Account and the
Reserve Sub-Account and deposited into the Note Payment Account,
Reserve Sub-Account, Funding Account or Distribution Account on
the Business Day preceding the related Payment Date pursuant to
Section 3.03. The determination by the Servicer of such amounts
shall, in the absence of obvious error, be deemed to be
presumptively correct for all purposes hereunder, and the Owner
Trustee and the Indenture Trustee shall be protected in relying
upon the same without any independent check or verification. In
addition, upon the Issuer's written request, the Servicer shall
promptly furnish such information reasonably requested by the
Issuer that is reasonably available to the Servicer to enable the
Issuer to perform its federal and state income tax reporting
obligations.
(c) If the Note Balance of the Variable Pay Revolving Notes is to be
reduced on any Payment Date pursuant to the terms of the
Indenture, the Servicer shall, not later than 12:00 Noon (New
York time) on the second Business Day prior to such Payment Date,
deliver a written notice to the Administrative Agent specifying
the amount of such reduction.
Section 4.02 Tax Returns and 1934 Act Reports
(a) The Servicer will act as the Tax Matters Partner or the agent for the
Tax Matters Partner pursuant to the Trust Agreement. The
Servicer agrees to perform the obligations of the Servicer set
forth in Section 5.03 of the Trust Agreement. The Servicer will
prepare and file or cause to be prepared and filed all tax and
information returns of the Trust Estate.
(b) The Servicer shall, on behalf of RAMP and in respect of the Trust Fund,
prepare and cause to be filed with the Commission any periodic
reports required to be filed under the provisions of the Exchange
Act, and the rules and regulations of the Commission thereunder,
including, without limitation, reports on Form 10-K, Form 10-D
and Form 8-K, . In connection with the preparation and filing of
such periodic reports, the Indenture Trustee shall timely provide
to the Servicer (I) a list of Noteholders as shown on the Note
Register as of the end of each calendar year, (II) copies of all
pleadings, other legal process and any other documents relating
to any claims, charges or complaints involving the Indenture
Trustee, as trustee, or the Trust Estate that are received by the
Indenture Trustee, (III) notice of all matters that, to the
actual knowledge of a Responsible Officer of the Indenture
Trustee, have been submitted to a vote of the Noteholders or
Certificateholders, other than those matters that have been
submitted to a vote of the Noteholders or Certificateholders at
the request of RAMP or the Servicer, and (IV) notice of any
failure of the Indenture Trustee to make any distribution to the
Noteholders or Certificateholders as required pursuant to the
Indenture or Trust Agreement, as applicable. The Indenture
Trustee shall have no liability with respect to the Servicer's
failure to properly prepare or file such periodic reports
resulting from or relating to the Servicer's inability or failure
to maintain or obtain any information not resulting from the
Servicer's own negligence or willful misconduct.
(c) Any Form 10-K filed with the Commission in connection with this
Section 4.02 shall include:
(i) A certification, signed by the senior officer in charge of the
servicing functions of the Servicer, in the form attached
as Exhibit D-1 hereto or such other form as may be required
or permitted by the Commission (the "Form 10-K
Certification"), in compliance with Rules 13a-14 and 15d-14
under the Exchange Act and any additional directives of the
Commission.
(ii) A report regarding its assessment of compliance during the preceding
calendar year with all applicable servicing criteria set
forth in relevant Commission regulations with respect to
mortgage-backed securities transactions taken as a whole
involving the Servicer that are backed by the same types of
assets as those backing the certificates, as well as
similar reports on assessment of compliance received from
other parties participating in the servicing function as
required by relevant Commission regulations, as described
in Item 1122(a) of Regulation AB. The Servicer shall
obtain from all other parties participating in the
servicing function any required certifications.
(iii) With respect to each assessment report described immediately above, a
report by a registered public accounting firm that attests
to, and reports on, the assessment made by the asserting
party, as set forth in relevant Commission regulations, as
described in Regulation 1122(b) of Regulation AB and
Section 3.11 hereof.
(iv) The servicer compliance certificate required to be delivered pursuant
Section 3.10.
(d) In connection with the Form 10-K Certification, the Indenture Trustee
shall provide the Servicer with a back-up certification
substantially in the form attached hereto as Exhibit D-2.
(e) This Section 4.02 may be amended in accordance with this Agreement
without the consent of the Securityholders.
ARTICLE V
Note Payment Account
Section 5.01 Note Payment Account. The Indenture Trustee shall
establish and maintain an Eligible Account entitled "________________, as
Indenture Trustee, for the benefit of the Securityholders, the Certificate
Paying Agent and the Enhancer, pursuant to the Indenture, dated as of
_______________, between Home Equity Loan Trust [ ]-[ ] and
_____________" (the "Note Payment Account"). On each Payment Date, amounts
on deposit in the Note Payment Account shall be distributed by the Indenture
Trustee in accordance with Section 3.05 of the Indenture. In addition, the
Indenture Trustee shall deposit in the Note Payment Account, the amount of
any Advance received from the holder of a Variable Pay Revolving Note in
accordance with Section 2.03 of the Indenture, or the proceeds of the sale
and issuance of a Variable Pay Revolving Note issued pursuant to the
Indenture after the Closing Date, to be applied as a distribution of
principal of the related Class of Term Notes on its respective Targeted Final
Payment Date. The Indenture Trustee shall invest or cause the institution
maintaining the Note Payment Account to invest the funds therein in Permitted
Investments selected in writing by the Servicer and designated in the name of
the Indenture Trustee, which investments shall mature not later than the
Business Day next preceding the Payment Date next following the date of such
investment (except that any investment in the institution with which the Note
Payment Account is maintained may mature on such Payment Date and shall not
be sold or disposed of prior to maturity). In addition, no such Permitted
Investment shall be purchased at a price in excess of par. All income and
gain realized from any such investment shall be for the benefit of the
Servicer and shall be subject to its withdrawal or order from time to time.
The amount of any losses incurred in respect of any such investments shall be
deposited in the Note Payment Account by the Servicer out of its own funds
immediately as realized.
ARTICLE VI
The Servicer
Section 6.01 Liability of the Servicer. The Servicer shall be liable in
accordance herewith only to the extent of the obligations specifically
imposed upon and undertaken by the Servicer herein.
Section 6.02 Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer. Any corporation into which the Servicer may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Servicer
shall be a party, or any corporation succeeding to the business of the
Servicer, shall be the successor of the 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.
The Servicer may assign its rights and delegate its duties and
obligations under this Agreement; provided, that the Person accepting such
assignment or delegation shall be a Person qualified to service mortgage
loans, is reasonably satisfactory to the Enhancer (provided, that such
consent to assignment may not be unreasonably withheld), is willing to
service the Mortgage Loans and executes and delivers to the Issuer (with a
copy to the Enhancer) an agreement, in form and substance reasonably
satisfactory to the Enhancer, that contains an assumption by such Person of
the due and punctual performance and observance of each covenant and
condition to be performed or observed by the Servicer under this Agreement;
and provided further, that no Rating Event will occur as a result of such
assignment and delegation (as evidenced by a letter to such effect from each
Rating Agency), if determined without regard to the Policy; and provided
further, that the Owner Trustee shall receive an Opinion of Counsel to the
effect that such assignment or delegation will not cause the Issuer to be
treated as an association (or a publicly-traded partnership) taxable as a
corporation for federal income tax purposes.
Section 6.03 Limitation on Liability of the Servicer and Others.
Neither the Servicer nor any of the directors or officers or employees or
agents of the Servicer shall be under any liability to the Issuer, the Owner
Trustee, the Indenture Trustee or the Securityholders for any action taken or
for refraining from the taking of any action in good faith pursuant to this
Agreement; provided, however, that this provision shall not protect the
Servicer or any such Person against any liability that would otherwise be
imposed by reason of its willful misfeasance, bad faith or gross negligence
in the performance of its duties hereunder or by reason of its reckless
disregard of its obligations and duties hereunder. The Servicer and any
director or officer or employee or agent of the 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 Servicer and any
director, officer, employee or agent of the Servicer shall be indemnified by
the Issuer and held harmless against any loss, liability or expense incurred
in connection with any legal action relating to this Agreement or the
Securities, including any amount paid to the Owner Trustee or the Indenture
Trustee pursuant to Section 6.06(b), other than any loss, liability or
expense related to any specific Mortgage Loan or Mortgage Loans (except as
any such loss, liability or expense shall be otherwise reimbursable pursuant
to this Agreement) and any loss, liability or expense incurred by reason of
its willful misfeasance, bad faith or gross negligence in the performance of
its duties hereunder or by reason of its reckless disregard of its
obligations and duties hereunder. The Servicer shall not be under any
obligation to appear in, prosecute or defend any legal action that is not
incidental to its duties to service the Mortgage Loans in accordance with
this Agreement, and that in its opinion may involve it in any expense or
liability; provided, however, that the Servicer may in its sole discretion
undertake any such action that it may deem necessary or desirable in respect
of this Agreement, the rights and duties of the parties hereto and the
interests of the Securityholders. In such event, the reasonable legal
expenses and costs of such action and any liability resulting therefrom shall
be expenses, costs and liabilities of the Issuer, and the Servicer shall be
entitled to be reimbursed therefor. The Servicer's right to indemnity or
reimbursement pursuant to this Section 6.03 shall survive any resignation or
termination of the Servicer pursuant to Section 6.04 or 7.01 with respect to
any losses, expenses, costs or liabilities arising prior to such resignation
or termination (or arising from events that occurred prior to such
resignation or termination).
Section 6.04 Servicer Not to Resign. Subject to the provisions of
Section 6.02, the Servicer shall not resign from the obligations and duties
hereby imposed on it except (a) upon determination that the performance of
its obligations or duties hereunder are no longer permissible under
applicable law or are in material conflict by reason of applicable law with
any other activities carried on by it or its subsidiaries or Affiliates, the
other activities of the Servicer so causing such a conflict being of a type
and nature carried on by the Servicer or its subsidiaries or Affiliates at
the date of this Agreement or (b) upon satisfaction of the following
conditions: (i) the Servicer shall have proposed a successor Servicer to the
Issuer and the Indenture Trustee in writing and such proposed successor
Servicer is reasonably acceptable to the Issuer, the Indenture Trustee and
the Enhancer; (ii) each Rating Agency shall have delivered a letter to the
Issuer, the Enhancer and the Indenture Trustee prior to the appointment of
the successor Servicer stating that the proposed appointment of such
successor Servicer as Servicer hereunder will not cause a Rating Event, if
determined without regard to the Policy; and (iii) such proposed successor
Servicer is reasonably acceptable to the Enhancer, as evidenced by a letter
to the Issuer and the Indenture Trustee; provided, however, that no such
resignation by the Servicer shall become effective until such successor
Servicer or, in the case of (a) above, the Indenture Trustee, as pledgee of
the Mortgage Loans, shall have assumed the Servicer's responsibilities and
obligations hereunder or the Indenture Trustee, as pledgee of the Mortgage
Loans, shall have designated a successor Servicer in accordance with Section
7.02. Any such resignation shall not relieve the Servicer of responsibility
for any of the obligations specified in Sections 7.01 and 7.02 as obligations
that survive the resignation or termination of the Servicer. Any such
determination permitting the resignation of the Servicer shall be evidenced
by an Opinion of Counsel to such effect delivered to the Indenture Trustee
and the Enhancer.
Section 6.05 Delegation of Duties. In the ordinary course of business,
the Servicer at any time may delegate any of its duties hereunder to any
Person, including any of its Affiliates, that agrees to conduct such duties
in accordance with standards comparable to those with which the Servicer
complies pursuant to Section 3.01. Such delegation shall not relieve the
Servicer of its obligations, liabilities and responsibilities with respect to
such duties and shall not constitute a resignation within the meaning of
Section 6.04.
Section 6.06 Payment of Indenture Trustee's and Owner Trustee's Fees and
Expenses; Indemnification.
(a) After the Closing Date, the Servicer covenants and agrees to pay to the
Owner Trustee, the Indenture Trustee and any co-trustee of the
Indenture Trustee or the Owner Trustee from time to time, and the
Owner Trustee, the Indenture Trustee and any such co-trustee
shall be entitled to, reasonable compensation (which shall not be
limited by any provision of law in regard to the compensation of
a trustee of an express trust and, in the case of the Indenture
Trustee, for so long as ______________ is the Servicer shall be
as set forth in the letter agreement between the Indenture
Trustee and the Servicer dated as of ____________) for all
services rendered by each of them in the execution of the trusts
created under the Trust Agreement and the Indenture and in the
exercise and performance of any of the powers and duties under
the Trust Agreement or the Indenture, as the case may be, of the
Owner Trustee, the Indenture Trustee and any co-trustee, and the
Servicer will pay or reimburse the Indenture Trustee and any
co-trustee upon request for all reasonable expenses,
disbursements and advances incurred or made by the Indenture
Trustee or any co-trustee in accordance with any of the
provisions of this Agreement, the Indenture or the Trust
Agreement except any such expense, disbursement or advance as may
arise from its negligence, willful misfeasance or bad faith. In
addition, the Indenture Trustee shall be entitled to be
reimbursed from the Servicer for all reasonable costs associated
with the transfer of servicing from the predecessor servicer
pursuant to Section 7.02 hereunder, including, without
limitation, any reasonable costs or expenses associated with the
complete transfer of all servicing data and the completion,
correction or manipulation of such servicing data as may be
required by the Indenture Trustee to correct any errors or
insufficiencies in the servicing data or otherwise to enable the
Indenture Trustee to service the Mortgage Loans properly and
effectively.
(b) The Servicer agrees to indemnify the Indenture Trustee and the Owner
Trustee for, and to hold the Indenture Trustee and the Owner
Trustee, as the case may be, harmless against, any loss,
liability or expense incurred without negligence, bad faith or
willful misconduct on the part of the Indenture Trustee or the
Owner Trustee, as the case may be, arising out of, or in
connection with, the acceptance and administration of the Issuer
and the assets thereof, including the costs and expenses
(including reasonable legal fees and expenses) of defending the
Indenture Trustee or the Owner Trustee, as the case may be,
against any claim in connection with the exercise or performance
of any of its powers or duties under any Basic Document; provided
that:
(i) with respect to any such claim, the Indenture Trustee or Owner Trustee,
as the case may be, shall have given the Servicer written
notice thereof promptly after the Indenture Trustee or
Owner Trustee, as the case may be, shall have actual
knowledge thereof;
(ii) while maintaining control over its own defense, the Issuer, the
Indenture Trustee or Owner Trustee, as the case may be,
shall cooperate and consult fully with the Servicer in
preparing such defense; and
(iii) notwithstanding anything in this Agreement to the contrary, the
Servicer shall not be liable for settlement of any claim by
the Indenture Trustee or the Owner Trustee, as the case may
be, entered into without the prior consent of the Servicer.
No termination of this Agreement or resignation or removal of the Indenture
Trustee shall affect the obligations created by this Section 6.06 of the
Servicer to indemnify the Indenture Trustee and the Owner Trustee under the
conditions and to the extent set forth herein.
Notwithstanding the foregoing, the indemnification provided by the
Servicer in this Section 6.06(b) shall not pertain to any loss, liability or
expense of the Indenture Trustee or the Owner Trustee, including the costs
and expenses of defending itself against any claim, incurred in connection
with any actions taken by the Indenture Trustee or the Owner Trustee at the
direction of the Noteholders or Certificateholders, as the case may be,
pursuant to the terms of this Agreement.
ARTICLE VII
Default
Section 7.01 Servicing Default.
(a) If a Servicing Default shall occur and be continuing, then, and in
every such case, so long as a Servicing Default shall not have
been remedied by the Servicer, either the Issuer or the Indenture
Trustee, upon actual knowledge of the occurrence of a Servicing
Default and with the consent of the Enhancer (so long as no
Enhancer Default exists), or the Enhancer, by notice then given
in writing to the Servicer, the Issuer and the Indenture Trustee,
may terminate all of the rights and obligations of the Servicer
as servicer under this Agreement other than its right to receive
servicing compensation and expenses for servicing the Mortgage
Loans hereunder during any period prior to the date of such
termination, and the Enhancer or the Issuer or the Indenture
Trustee with the consent of the Enhancer (so long as no Enhancer
Default exists), may exercise any and all other remedies
available at law or equity. Any such notice to the Servicer
shall also be given to each Rating Agency, the Enhancer and the
Issuer. On or after the receipt by the Servicer of such written
notice, all authority and power of the Servicer under this
Agreement, whether with respect to the Securities or the Mortgage
Loans or otherwise, shall pass to and be vested in the Indenture
Trustee, subject to Section 7.02 hereof, as pledgee of the
Mortgage Loans, pursuant to and under this Section 7.01; and,
without limitation, the Indenture Trustee is hereby authorized
and empowered to execute and deliver, on behalf of the Servicer,
as attorney-in-fact or otherwise, any and all documents and other
instruments, and to 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 of
each Mortgage Loan and related documents, or otherwise. The
Servicer agrees to cooperate with the Issuer, the Enhancer and
Indenture Trustee, as the case may be, in effecting the
termination of the responsibilities and rights of the Servicer
hereunder, including, without limitation, the transfer to the
Indenture Trustee for the administration by it of all cash
amounts relating to the Mortgage Loans that shall at the time be
held by the Servicer and to be deposited by it in the Custodial
Account, or that have been deposited by the Servicer in the
Custodial Account or thereafter received by the Servicer with
respect to the Mortgage Loans, the recordation of Assignments of
Mortgages to the Indenture Trustee if MERS is not the mortgagee
of a Mortgage Loan, and the delivery of the Mortgage Files in its
possession to the Indenture Trustee. All reasonable costs and
expenses (including, but not limited to, attorneys' fees)
incurred in connection with amending this Agreement to reflect
such succession as Servicer pursuant to this Section 7.01 shall
be paid by the predecessor Servicer (or if the predecessor
Servicer is the Indenture Trustee, the initial Servicer) upon
presentation of reasonable documentation of such costs and
expenses.
(b) Notwithstanding any termination of the activities of the Servicer
hereunder, the Servicer shall be entitled to receive, out of any
late collection of a payment on a Mortgage Loan which was due
prior to the notice terminating the Servicer's rights and
obligations hereunder and received after such notice, that
portion to which the Servicer would have been entitled pursuant
to Sections 3.03 and 3.09 as well as its Servicing Fee in respect
thereof, and any other amounts payable to the Servicer hereunder
the entitlement to which arose prior to the termination of its
activities hereunder.
Notwithstanding the foregoing, a delay in or failure of performance
under clause (i) or (ii) of the definition of Servicing Default, after the
applicable grace periods specified therein, shall not constitute a Servicing
Default if such delay or failure could not be prevented by the exercise of
reasonable diligence by the Servicer and such delay or failure was caused by
an act of God or the public enemy, acts of declared or undeclared war, public
disorder, rebellion or sabotage, epidemics, landslides, lightning, fire,
hurricanes, earthquakes, floods or similar causes. The preceding sentence
shall not relieve the Servicer from using reasonable efforts to perform its
respective obligations in a timely manner in accordance with the terms of
this Agreement. The Servicer shall provide the Indenture Trustee, the
Enhancer and the Securityholders with notice of any such failure or delay by
it, together with a description of its efforts to so perform its
obligations. The Servicer shall immediately notify the Indenture Trustee,
the Enhancer and the Issuer in writing of any Servicing Default.
Section 7.02 Indenture Trustee to Act; Appointment of Successor.
(a) (a) On and after the time the Servicer receives a notice of
termination pursuant to Section 7.01 or sends a notice pursuant
to Section 6.04, the Indenture Trustee as pledgee of the Mortgage
Loans shall itself become, or shall appoint an affiliate of the
Indenture Trustee to become the successor in all respects to the
Servicer in its capacity as servicer under this Agreement and the
transactions set forth or provided for herein and shall
immediately assume all of the obligations of the Servicer to make
advances on Mortgage Loans under Section 3.02(b) and will be
subject to all other responsibilities, duties and liabilities
relating thereto placed on the Servicer by the terms and
provisions hereof as soon as practicable, but in no event later
than 90 days after the Indenture Trustee becomes successor
servicer. During such 90 day period, the Indenture Trustee, with
the consent of the Enhancer, may require the Servicer being
terminated to continue to perform such servicing responsibilities
(other than making advances on the Mortgage Loans under Section
3.02(b)) as the Indenture Trustee deems appropriate. In such
event, the Servicer being terminated shall provide such services
as directed by the Indenture Trustee until the earliest of the
date the Indenture Trustee notifies such Servicer to discontinue
providing such services, the date on which a successor servicer
or the Indenture Trustee has assumed all responsibilities, duties
and liabilities of the Servicer hereunder or the expiration of
the 90 day period. The Servicer shall be entitled to the
Servicing Fee hereunder for any period during which the Servicer
is obligated to provide such services as if no termination of the
Servicer had occurred. Nothing in this Agreement or in the Trust
Agreement shall be construed to permit or require the Indenture
Trustee to (i) succeed to the responsibilities, duties and
liabilities of the initial Servicer in its capacity as Seller
under the Purchase Agreement, (ii) be responsible or accountable
for any act or omission of the Servicer prior to the issuance of
a notice of termination hereunder, (iii) require or obligate the
Indenture Trustee, in its capacity as successor Servicer, to
purchase, repurchase or substitute any Mortgage Loan, (iv) fund
any Additional Balances with respect to any Mortgage Loan, (v)
fund any losses on any Permitted Investment directed by any other
Servicer, or (vi) be responsible for the representations and
warranties of the Servicer. As compensation therefor, the
Indenture Trustee shall be entitled to such compensation as the
Servicer would have been entitled to hereunder if no such notice
of termination had been given. Notwithstanding the foregoing, if
the Indenture Trustee is (x) unwilling to act as successor
Servicer itself or to appoint an affiliate to become successor
Servicer, or (y) legally unable so to act, the Indenture Trustee
as pledgee of the Mortgage Loans may (in the situation described
in clause (x)) or shall (in the situation described in clause
(y)) appoint or petition a court of competent jurisdiction to
appoint any established housing and home finance institution,
bank or other mortgage loan servicer having a net worth of not
less than $10,000,000 as the successor to the Servicer hereunder
in the assumption of all or any part of the responsibilities,
duties or liabilities of the Servicer hereunder; provided, that
any such successor Servicer shall be acceptable to the Enhancer,
as evidenced by the Enhancer's prior written consent, which
consent shall not be unreasonably withheld; and provided further,
that the appointment of any such successor Servicer will not
result in a Rating Event, if determined without regard to the
Policy. Pending appointment of a successor to the Servicer
hereunder, unless the Indenture Trustee is prohibited by law from
so acting, the Indenture Trustee itself shall act or appoint an
affiliate to act in such capacity as provided above. In
connection with such appointment and assumption, the successor
shall be entitled to receive compensation out of payments on
Mortgage Loans in an amount equal to the compensation that the
Servicer would otherwise have received pursuant to Section 3.09
(or such other compensation as the Indenture Trustee and such
successor shall agree). The appointment of a successor Servicer
shall not affect any liability of the predecessor Servicer that
may have arisen under this Agreement prior to its termination as
Servicer (including the obligation to purchase Mortgage Loans
pursuant to Section 3.01, to pay any deductible under an
insurance policy pursuant to Section 3.04 or to indemnify the
Indenture Trustee pursuant to Section 6.06), nor shall any
successor Servicer be liable for any acts or omissions of the
predecessor Servicer or for any breach by such Servicer of any of
its representations or warranties contained herein or in any
related document or agreement. The Indenture Trustee and such
successor shall take such action, consistent with this Agreement
and the requirements (including any notice requirements) of
applicable law, as shall be necessary to effectuate any such
succession. Notwithstanding the foregoing, the Indenture
Trustee, in its capacity as successor Servicer, shall not be
responsible for the lack of information and/or documents that it
cannot obtain through reasonable efforts or for failing to take
any action that the Indenture Trustee is legally prohibited from
taking by applicable law.
(b) Any successor, including the Indenture Trustee, to the Servicer as
servicer shall during its term as Servicer (i) continue to
service and administer the Mortgage Loans for the benefit of the
Securityholders, (ii) maintain in force a policy or policies of
insurance covering errors and omissions in the performance of its
obligations as Servicer hereunder and a fidelity bond in respect
of its officers, employees and agents to the same extent as the
Servicer is so required pursuant to Section 3.13 and (iii) be
bound by the terms of the Insurance Agreement.
(c) Any successor Servicer, including the Indenture Trustee, shall not be
deemed in default or to have breached its duties hereunder if the
predecessor Servicer shall fail to deliver any required deposit
to the Custodial Account or otherwise cooperate with any required
servicing transfer or succession hereunder.
(d) In connection with the termination or resignation of the Servicer
hereunder, either (i) the successor Servicer, including the
Indenture Trustee if the Indenture Trustee is acting as successor
Servicer, shall represent and warrant that it is a member of MERS
in good standing and shall agree to comply in all material
respects with the rules and procedures of MERS in connection with
the servicing of the Mortgage Loans that are registered with
MERS, in which case the predecessor Servicer shall cooperate with
the successor Servicer in causing MERS to revise its records to
reflect the transfer of servicing to the successor Servicer as
necessary under MERS' rules and regulations, or (ii) the
predecessor Servicer shall cooperate with the successor Servicer
in causing MERS to execute and deliver an assignment of Mortgage
in recordable form to transfer the Mortgage from MERS to the
Indenture Trustee and to execute and deliver such other notices,
documents and other instruments as may be necessary or desirable
to effect a transfer of such Mortgage Loan or servicing of such
Mortgage Loan on the MERS® System to the successor Servicer. The
predecessor Servicer shall file or cause to be filed any such
assignment in the appropriate recording office. The predecessor
Servicer shall bear any and all fees of MERS, costs of preparing
any assignments of Mortgage, and fees and costs of filing any
assignments of Mortgage that may be required under this
subsection (d). The successor Servicer shall cause such
assignment to be delivered to the Indenture Trustee or the
Custodian promptly upon receipt of the original with evidence of
recording thereon or a copy certified by the public recording
office in which such assignment was recorded.
Section 7.03 Notification to Securityholders. Upon any termination of
or appointment of a successor to the Servicer pursuant to this Article VII or
Section 6.04, the Indenture Trustee shall give prompt written notice thereof
to the Securityholders, the Enhancer, the Issuer and each Rating Agency.
ARTICLE VIII
Compliance With Regulation AB
Section 8.01 Intent of the Parties; Reasonableness.
RAMP, the Indenture Trustee and the Servicer acknowledge and
agree that the purpose of this Article VIII is to facilitate compliance by
RAMP with the provisions of Regulation AB and related rules and regulations
of the Commission. RAMP shall not exercise its right to request delivery of
information or other performance under these provisions other than in good
faith, or for purposes other than compliance with the Securities Act, the
Exchange Act and the rules and regulations of the Commission under the
Securities Act and the Exchange Act. Each of the Servicer and the Indenture
Trustee acknowledges that interpretations of the requirements of
Regulation AB may change over time, whether due to interpretive guidance
provided by the Commission or its staff, consensus among participants in the
mortgage-backed securities markets, advice of counsel, or otherwise, and
agrees to comply with requests made by RAMP in good faith for delivery of
information under these provisions on the basis of evolving interpretations
of Regulation AB. Each of the Servicer and the Indenture Trustee shall
cooperate fully with RAMP to deliver to RAMP (including any of its assignees
or designees), any and all statements, reports, certifications, records and
any other information necessary in the good faith determination of RAMP to
permit RAMP to comply with the provisions of Regulation AB, together with
such disclosures relating to the Servicer, the Indenture Trustee and the
Mortgage Loans, or the servicing of the Mortgage Loans, reasonably believed
by RAMP to be necessary in order to effect such compliance.
Section 8.02 Additional Representations and Warranties of the Indenture
Trustee.
(a) The Indenture Trustee shall be deemed to represent to RAMP as of the
date on which information is first provided to RAMP under Section
8.03 that, except as disclosed in writing to RAMP prior to such
date: (i) it is not aware and has not received notice that any
default, early amortization or other performance triggering event
has occurred as to any other Securitization Transaction due to
any act or failure to act of the Indenture Trustee; (ii) it has
not been terminated as trustee in a securitization of mortgage
loans; (iii) there are no aspects of its financial condition that
could have a material adverse effect on the performance by it of
its trustee obligations under this Agreement or any other
Securitization Transaction; (iv) there are no material legal or
governmental proceedings pending (or known to be contemplated)
against it; and (v) there are no affiliations, relationships or
transactions relating to the Indenture Trustee with respect to
RAMP or any sponsor, issuing entity, servicer, trustee,
originator, significant obligor, enhancement or support provider
or other material transaction party (as such terms are used in
Regulation AB) relating to the Securitization Transaction
contemplated by the Agreement (the "Transaction Parties").
(b) If so requested by RAMP on any date following the date on which
information is first provided to RAMP under Section 8.03, the
Indenture Trustee shall, within five Business Days following such
request, confirm in writing the accuracy of the representations
and warranties set forth in paragraph (a) of this Section or, if
any such representation and warranty is not accurate as of the
date of such request or such confirmation, provide reasonably
adequate disclosure of the pertinent facts, in writing, to the
requesting party.
Section 8.03 Information to Be Provided by the Indenture Trustee.
(a) If so requested by RAMP for the purpose of satisfying its reporting
obligation under the Exchange Act with respect to any class of
Certificates, the Indenture Trustee shall (i) notify RAMP in
writing of (A) any material litigation or governmental
proceedings pending against the Indenture Trustee and (B) any
affiliations or relationships that develop following the Closing
Date between the Indenture Trustee and any Transaction Party, and
(ii) provide to RAMP a written description of such proceedings,
affiliations or relationships.
(b) In addition to such information as the Indenture Trustee is obligated
to provide pursuant to other provisions of this Agreement, if so
requested by RAMP , the Indenture Trustee shall provide such
information reasonably available to the Indenture Trustee
regarding the performance or servicing of the Mortgage Loans as
is reasonably required to facilitate preparation of distribution
reports in accordance with Item 1121 of Regulation AB.
Section 8.04 Report on Assessment of Compliance and Attestation.
On or before March 15 of each calendar year, the Indenture
Trustee shall:
(a) deliver to RAMP a report (in form and substance reasonably satisfactory
to RAMP) regarding the Indenture Trustee's assessment of
compliance with the Servicing Criteria during the immediately
preceding calendar year, as required under Rules 13a-18 and
15d-18 of the Exchange Act and Item 1122 of Regulation AB. Such
report shall be addressed to RAMP and signed by an authorized
officer of the Indenture Trustee, and shall address each of the
Servicing Criteria specified on a certification substantially in
the form of Exhibit E hereto; and
(b) deliver to RAMP a report of a registered public accounting firm
reasonably acceptable to RAMP that attests to, and reports on,
the assessment of compliance made by the Indenture Trustee and
delivered pursuant to the preceding paragraph. Such attestation
shall be in accordance with Rules 1-02(a)(3) and 2-02(g) of
Regulation S-X under the Securities Act and the Exchange Act.
Section 8.05 Indemnification; Remedies.
(a) The Indenture Trustee shall indemnify RAMP, each affiliate of RAMP, the
Servicer and each broker dealer acting as underwriter, placement
agent or initial purchaser of the Certificates or each Person who
controls any of such parties (within the meaning of Section 15 of
the Securities Act and Section 20 of the Exchange Act); and the
respective present and former directors, officers, employees and
agents of each of the foregoing, and shall hold each of them
harmless from and against any losses, damages, penalties, fines,
forfeitures, legal fees and expenses and related costs,
judgments, and any other costs, fees and expenses that any of
them may sustain arising out of or based upon:
(i) (A) any untrue statement of a material fact contained or
alleged to be contained in any information, report,
certification, accountants' letter or other material
provided under this Article VIII by or on behalf of the
Indenture Trustee (collectively, the "Indenture Trustee
Information"), or (B) the omission or alleged omission to
state in the Indenture Trustee Information a material fact
required to be stated in the Indenture Trustee Information
or necessary in order to make the statements therein, in
the light of the circumstances under which they were made,
not misleading; provided, by way of clarification, that
clause (B) of this paragraph shall be construed solely by
reference to the Indenture Trustee Information and not to
any other information communicated in connection with a
sale or purchase of securities, without regard to whether
the Indenture Trustee Information or any portion thereof is
presented together with or separately from such other
information;
(ii) any failure by the Indenture Trustee to deliver any information,
report, certification, accountants' letter or other
material when and as required under this Article VIII; or
(iii) any breach by the Indenture Trustee of a representation or warranty set
forth in Section 8.02(a) or in a writing furnished pursuant
to Section 8.02(b).
(b) In the case of any failure of performance described in clause (ii) of
this Section, the Indenture Trustee shall promptly reimburse RAMP
for all costs reasonably incurred by each such party in order to
obtain the information, report, certification, accountants'
letter or other material not delivered as required by the
Indenture Trustee.
ARTICLE IX
Miscellaneous Provisions
Section 9.01 Amendment. This Agreement may be amended from time to time
by the parties hereto; provided, that any such amendment shall be accompanied
by a letter from each Rating Agency to the effect that such amendment will
not result in a Rating Event, if determined without regard to the Policy; and
provided further, that the Enhancer and the Indenture Trustee shall consent
thereto.
Section 9.02 GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.
Section 9.03 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 certified mail, return receipt requested, to (a) in
the case of the Servicer, _______________, (b) in the case of the Enhancer,
__________________ (c) in the case of ▇▇▇▇▇'▇, Home Mortgage Loan Monitoring
Group, 4th Floor, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, (d) in the case
of Standard & Poor's, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇,
Attention: Residential Mortgage Surveillance Group, (e) in the case of the
Owner Trustee, ______________ and (f) in the case of the Issuer, Home Equity
Loan Trust [ ]-[ ], c/o the Owner Trustee at the address set forth in
clause (e) above, and (g) in the case of the Indenture Trustee, at the
Corporate Trust Office of the Indenture Trustee; or, with respect to each of
the foregoing Persons, at such other address as shall be designated by such
Person in a written notice to the other foregoing Persons. Any notice
required or permitted to be mailed to a Securityholder shall be given by
first class mail, postage prepaid, at the address of such Securityholder as
shown in the Note Register or Certificate Register, as the case may be. Any
notice so mailed within the time prescribed in this Agreement shall be
conclusively presumed to have been duly given, whether or not the related
Securityholder receives such notice. Any notice or other document required
to be delivered or mailed by the Indenture Trustee to any Rating Agency shall
be given on a reasonable efforts basis and only as a matter of courtesy and
accommodation, and the Indenture Trustee shall have no liability for failure
to deliver any such notice or document to any Rating Agency.
Section 9.04 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity
or enforceability of the other provisions of this Agreement or the Securities
or the rights of the Securityholders.
Section 9.05 Third-Party Beneficiaries. This Agreement shall inure to
the benefit of and be binding upon the parties hereto, the Securityholders,
the Enhancer, the Owner Trustee and their respective successors and permitted
assigns. Except as otherwise provided in this Agreement, no other Person
shall have any right or obligation hereunder.
Section 9.06 Counterparts. This instrument may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
Section 9.07 Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.
Section 9.08 Termination Upon Purchase by the Servicer or Liquidation of
All Mortgage Loans; Partial Redemption.
(a) The respective obligations and responsibilities of the Servicer, the
Issuer and the Indenture Trustee created hereby shall terminate
upon the last action required to be taken by the Issuer pursuant
to the Trust Agreement and by the Indenture Trustee pursuant to
the Indenture following the earlier of:
(i) the date on or before which the Indenture or the Trust Agreement is
terminated, or
(ii) the purchase by the Servicer from the Issuer of all Mortgage Loans and
REO Property in accordance with Section 8.08(b).
(b) The Servicer shall have the right to purchase from the Issuer all of
the Mortgage Loans and related REO Property if the aggregate Note
Balance of the Notes as of any Payment Date is less than 10% of
the aggregate Note Balance of the Notes as of the Closing Date
(provided that a draw on the Policy would not occur as a result
of such purchase and provided further that the purchase price
will provide sufficient funds to pay the outstanding Note Balance
and accrued and unpaid interest on the Notes to the Payment Date
on which such amounts are to be distributed to the
Securityholders), at a price equal to 100% of the aggregate
unpaid Principal Balance of all such remaining Mortgage Loans,
plus accrued and unpaid interest thereon at the weighted average
of the Loan Rates thereon up to the date preceding the Payment
Date on which such amounts are to be distributed to the
Securityholders (and in the case of REO Property, the fair market
value of the REO Property), plus any amounts due and owing to the
Enhancer under the Insurance Agreement related to the Mortgage
Loans or the Notes (and any unpaid Servicing Fee relating to the
Mortgage Loans shall be deemed to have been paid at such time),
plus any Interest Shortfall and interest owed thereon to the
Noteholders.
The Servicer shall send written notice to the Enhancer of its
intent to exercise its right to purchase any of the Mortgage Loans pursuant
to this Section 8.08(b).
If such right is exercised by the Servicer, the Servicer shall
deposit the amount calculated pursuant to this Section 8.08(b) with the
Indenture Trustee pursuant to Section 4.10 of the Indenture and, upon the
receipt of such deposit, the Indenture Trustee or Custodian shall release to
the Servicer, the files pertaining to the Mortgage Loans being purchased.
The Servicer, at its expense, shall prepare and deliver to the Indenture
Trustee for execution, at the time the related Mortgage Loans are to be
released to the Servicer, appropriate documents assigning each such Mortgage
Loans from the Indenture Trustee or the Issuer to the Servicer or the
appropriate party.
Section 9.09 Certain Matters Affecting the Indenture Trustee. For all
purposes of this Agreement, in the performance of any of its duties or in the
exercise of any of its powers hereunder, the Indenture Trustee shall be
subject to and entitled to the benefits of Article VI of the Indenture.
Section 9.10 Owner Trustee Not Liable for Related Documents. The
recitals contained herein shall be taken as the statements of the Servicer,
and the Owner Trustee and the Indenture Trustee assume no responsibility for
the correctness thereof. The Owner Trustee and the Indenture Trustee make no
representations as to the validity or sufficiency of this Agreement, of any
Basic Document or Related Document, or of the Certificates (other than the
signatures of the Owner Trustee and the Indenture Trustee on the
Certificates) or the Notes. The Owner Trustee and the Indenture Trustee
shall at no time have any responsibility or liability with respect to the
sufficiency of the Trust Estate or its ability to generate the payments to be
distributed to Certificateholders under the Trust Agreement or the
Noteholders under the Indenture, including the compliance by RAMP, the
Sellers or the Servicer with any warranty or representation made under any
Basic Document or the accuracy of any such warranty or representation, or any
action of any person taken in the name of the Owner Trustee or the Indenture
Trustee.
IN WITNESS WHEREOF, the Servicer, the Issuer and the Indenture Trustee
have caused this Agreement to be duly executed by their respective officers
or representatives all as of the day and year first above written.
___________________________,
as Servicer
By:
Name:
Title:
HOME EQUITY LOAN TRUST [ ]-[ ],
as Issuer
By: ________________, not in its
individual capacity but solely
as Owner Trustee
By:
Name:
Title:
________________________,
as Indenture Trustee
By:
Name:
Title:
Acknowledged and Agreed
solely with respect to Article VII:
RESIDENTIAL ASSET MORTGAGE PRODUCTS, INC.
By:
Name:
Title:
EXHIBIT A
MORTGAGE LOAN SCHEDULE
[ON FILE WITH THE INDENTURE TRUSTEE]
EXHIBIT B
LIMITED POWER OF ATTORNEY
KNOW ALL MEN BY THESE PREMISES:
That _____________________, as indenture trustee (the "Indenture
Trustee"), under the indenture dated as of _________________ (the
"Indenture"), between Home Equity Loan Trust [ ]-[ ], as issuer and the
Indenture Trustee, a national banking association organized and existing
under the laws of the United States of America, and having its principal
office located at ____________________, hath made, constituted and appointed,
and does by these presents make, constitute and appoint ___________________,
a corporation organized and existing under the laws of [ ], its true and
lawful Attorney-in-Fact, with full power and authority to sign, execute,
acknowledge, deliver, file for record, and record any instrument on its
behalf and to perform such other act or acts as may be customarily and
reasonably necessary and appropriate to effectuate the following enumerated
transactions in respect of any of the Mortgages securing a Mortgage Loan and
the related Loan Agreements for which the undersigned is acting as Indenture
Trustee for various Securityholders (whether the undersigned is named therein
as mortgagee or beneficiary or has become mortgagee by virtue of endorsement
of such Loan Agreement secured by any such Mortgage) and for which
__________________ is acting as Servicer pursuant to a Servicing Agreement
dated as of __________________ (the "Servicing Agreement").
This appointment shall apply to the following enumerated transactions only:
1. The modification or re-recording of a Mortgage, where said modification
or re-recording is for the purpose of correcting the Mortgage to
conform same to the original intent of the parties thereto or to
correct title errors discovered after such title insurance was issued
and said modification or re-recording, in either instance, does not
adversely affect the Lien of the Mortgage as insured.
2. The subordination of the Lien of a Mortgage to an easement in favor of
a public utility company or a government agency or unit with powers of
eminent domain; this section shall include, without limitation, the
execution of partial satisfactions/releases, partial reconveyances or
the execution of requests to trustees to accomplish same.
3. With respect to a Mortgage, the foreclosure, the taking of a deed in
lieu of foreclosure, or the completion of judicial or non-judicial
foreclosure or termination, cancellation or rescission of any such
foreclosure, including, without limitation, any and all of the
following acts:
a. The substitution of trustee(s) serving under a Mortgage, in
accordance with state law and the Mortgage;
b. Statements of breach or non-performance;
c. Notices of default;
d. Cancellations/rescissions of notices of default or notices of
sale;
e. The taking of a deed in lieu of foreclosure; and
f. Such other documents and actions as may be necessary under the
terms of the Mortgage or state law to expeditiously complete said
transactions.
4. The conveyance of the properties to the mortgage insurer, or the
closing of the title to the property to be acquired as real estate
owned, or conveyance of title to real estate owned.
5. The completion of loan assumption agreements.
6. The full satisfaction/release of a Mortgage or full reconveyance upon
payment and discharge of all sums secured thereby, including, without
limitation, cancellation of the related Loan Agreement.
7. The assignment of any Mortgage and the related Loan Agreement, in
connection with the repurchase of the Mortgage Loan secured and
evidenced thereby.
8. The full assignment of a Mortgage upon payment and discharge of all
sums secured thereby in conjunction with the refinancing thereof,
including, without limitation, the endorsement of the related Loan
Agreement.
9. The modification or re-recording of a Mortgage, where said modification
or re-recording is for the purpose of any modification pursuant to
Section 3.01 of the Servicing Agreement.
10. The execution of partial satisfactions/releases pursuant to Section
3.01 of the Servicing Agreement.
The undersigned gives said Attorney-in-Fact full power and authority to
execute such instruments and to do and perform all and every act and thing
necessary and proper to carry into effect the power or powers granted by or
under this Limited Power of Attorney as fully as the undersigned might or
could do, and hereby does ratify and confirm to all that said
Attorney-in-Fact shall lawfully do or cause to be done by authority hereof.
Capitalized terms used herein that are not otherwise defined shall have
the meanings ascribed thereto in Appendix A to the Indenture.
Third parties without actual notice may rely upon the exercise of the
power granted under this Limited Power of Attorney; and may be satisfied that
this Limited Power of Attorney shall continue in full force and effect has
not been revoked unless an instrument of revocation has been made in writing
by the undersigned.
________________________,
not in its individual capacity
but solely as Indenture Trustee
By:
Name:
Title:
STATE OF )
SS.
COUNTY OF )
On this [___] day of ________________, before me the undersigned,
Notary Public of said State, personally appeared
, personally known to me to be duly
authorized officers of _________________ that executed the within instrument
and personally known to me to be the persons who executed the within
instrument on behalf of _________________ therein named, and acknowledged to
me such _________________ executed the within instrument pursuant to its
by-laws.
WITNESS my hand and official seal.
Notary Public in and for the
State of
After recording, please mail to:
Attn:
C-1
EXHIBIT C
FORM OF REQUEST FOR RELEASE
DATE:
TO:
RE: REQUEST FOR RELEASE OF DOCUMENTS
In connection with your administration of the Mortgage Loans, we request the
release of the Mortgage File described below.
Servicing Agreement Dated:
Series #:
Account #:
Pool #:
Loan #:
Borrower Name(s):
Reason for Document Request: (circle one) Mortgage Loan
Prepaid in Full Mortgage Loan Repurchased
"We hereby certify that all amounts received or to be received in connection
with such payments which are required to be deposited have been or will be so
deposited as provided in the Servicing Agreement."
_______________________
Authorized Signature
******************************************************************************
TO CUSTODIAN: Please acknowledge this request, and check off documents being
enclosed with a copy of this form. You should retain this form for your
files in accordance with the terms of the Servicing Agreement.
Enclosed Documents: [__] Loan Agreement
Name
Title
Date
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF FORM 10-K CERTIFICATION
I, [identify the certifying individual], certify that:
1. I have reviewed the annual report on Form 10-K for the fiscal
year [____], and all reports on Form 8-K containing distribution or servicing
reports filed in respect of periods included in the year covered by that
annual report, of Home Equity Loan Trust [ ]-[ ] (the "Trust"), the
assets of which are serviced pursuant to the Servicing Agreement dated
_________________ (the "Servicing Agreement") among the Trust, ______________
(the "Servicer") and ________________ (the "Indenture Trustee");
2. Based on my knowledge, the information in these reports, 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 light of the
circumstances under which such statements were made, not misleading as of the
last day of the period covered by that annual report;
3. Based on my knowledge, the servicing information required to be
provided to the Indenture Trustee by the Servicer under the Servicing
Agreement is included in these reports;
4. I am responsible for reviewing the activities performed by the
Servicer under the Servicing Agreement and based upon my knowledge and the
review required under the Servicing Agreement, and, except as disclosed in
the report, the Servicer has fulfilled its obligations under the Servicing
Agreement; and
5. The reports disclose all significant deficiencies relating to the
Servicer's compliance with the minimum servicing standards based upon the
report provided by an independent public accountant , after conducting a
review in compliance with the Uniform Single Attestation Program for Mortgage
Bankers, or similar procedure, as set forth in the Servicing Agreement, that
is included in these reports.
[In giving the certifications above, I have reasonably relied on
information provided to me by the following unaffiliated parties:
[_________________], [_____________].
IN WITNESS WHEREOF, I have duly executed this certificate as of
_________, 20__.
____________________________*
Name:
Title:
* to be signed by the senior officer in charge of the servicing
functions of the Servicer
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF BACK-UP CERTIFICATION TO FORM 10-K CERTIFICATE
The undersigned, a Responsible Officer of _________________ (the
"Indenture Trustee") certifies that:
(a) The Indenture Trustee has performed all of the duties
specifically required to be performed by it pursuant to the provisions of the
Servicing Agreement dated as of _____________ (the "Agreement") by and among
Home Equity Loan Trust [ ]-[ ], as depositor, _______________, as
Servicer, and the Indenture Trustee in accordance with the standards set
forth therein.
(b) Based on my knowledge, the information that is provided by the
Indenture Trustee pursuant to Section 4.02(b) of the Agreement is accurate as
of the last day of the 20[__] calendar year.
Capitalized terms used and not defined herein shall have the meanings
given such terms in the Agreement.
IN WITNESS WHEREOF, I have duly executed this certificate as of
_________, 20[__].
____________________________*
Name:
Title:
E-4
EXHIBIT E
SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The assessment of compliance to be delivered by the Trustee shall
address, at a minimum, the criteria identified as below as "Applicable
Servicing Criteria":
Applicable
Servicing
Servicing Criteria Criteria
Reference Criteria
General Servicing Considerations
1122(d)(1)(i) Policies and procedures are instituted to
monitor any performance or other triggers and
events of default in accordance with the
transaction agreements.
1122(d)(1)(ii) If any material servicing activities are
outsourced to third parties, policies and
procedures are instituted to monitor the
third party's performance and compliance with
such servicing activities.
1122(d)(1)(iii) Any requirements in the transaction
agreements to maintain a back-up servicer for
the credit card accounts or accounts are
maintained.
1122(d)(1)(iv) A fidelity bond and errors and omissions
policy is in effect on the party
participating in the servicing function X
throughout the reporting period in the amount
of coverage required by and otherwise in
accordance with the terms of the transaction
agreements.
Cash Collection and Administration
1122(d)(2)(i) Payments on credit card accounts are
deposited into the appropriate custodial bank
accounts and related bank clearing accounts X
no more than two business days following
receipt, or such other number of days
specified in the transaction agreements.
1122(d)(2)(ii) Disbursements made via wire transfer on X
behalf of an obligor or to an investor are
made only by authorized personnel.
1122(d)(2)(iii) Advances of funds or guarantees regarding
collections, cash flows or distributions, and
any interest or other fees charged for such
advances, are made, reviewed and approved as
specified in the transaction agreements.
1122(d)(2)(iv) The related accounts for the transaction,
such as cash reserve accounts or accounts
established as a form of
overcollateralization, are separately
maintained (e.g., with respect to commingling
of cash) as set forth in the transaction
agreements.
1122(d)(2)(v) Each custodial account is maintained at a
federally insured depository institution as
set forth in the transaction agreements. For
purposes of this criterion, "federally
insured depository institution" with respect
to a foreign financial institution means a
foreign financial institution that meets the
requirements of Rule 13k-1(b)(1) of the
Securities Exchange Act.
1122(d)(2)(vi) Unissued checks are safeguarded so as to
prevent unauthorized access.
1122(d)(2)(vii) Reconciliations are prepared on a monthly
basis for all asset-backed securities related
bank accounts, including custodial accounts
and related bank clearing accounts. These
reconciliations are (A) mathematically
accurate; (B) prepared within 30 calendar
days after the bank statement cutoff date, or
such other number of days specified in the
transaction agreements; (C) reviewed and
approved by someone other than the person who
prepared the reconciliation; and (D) contain
explanations for reconciling items. These
reconciling items are resolved within 90
calendar days of their original
identification, or such other number of days
specified in the transaction agreements.
Investor Remittances and Reporting
1122(d)(3)(i) Reports to investors, including those to be
filed with the Commission, are maintained in
accordance with the transaction agreements
and applicable Commission requirements.
Specifically, such reports (A) are prepared
in accordance with timeframes and other terms
set forth in the transaction agreements; (B)
provide information calculated in accordance
with the terms specified in the transaction
agreements; (C) are filed with the Commission
as required by its rules and regulations; and
(D) agree with investors' or the trustee's
records as to the total unpaid principal
balance and number of credit card accounts
serviced by the Servicer.
1122(d)(3)(ii) Amounts due to investors are allocated and
remitted in accordance with timeframes, X
distribution priority and other terms set
forth in the transaction agreements.
1122(d)(3)(iii) Disbursements made to an investor are posted
within two business days to the Servicer's X
investor records, or such other number of
days specified in the transaction agreements.
1122(d)(3)(iv) Amounts remitted to investors per the
investor reports agree with cancelled checks, X
or other form of payment, or custodial bank
statements.
Pool Asset Administration
1122(d)(4)(i) Collateral or security on credit card
accounts is maintained as required by the X
transaction agreements or related asset pool
documents.
1122(d)(4)(ii) Account and related documents are safeguarded X
as required by the transaction agreements.
1122(d)(4)(iii) Any additions, removals or substitutions to
the asset pool are made, reviewed and
approved in accordance with any conditions or
requirements in the transaction agreements.
1122(d)(4)(iv) Payments on credit card accounts, including
any payoffs, made in accordance with the
related credit card accounts documents are
posted to the Servicer's obligor records
maintained no more than two business days
after receipt, or such other number of days
specified in the transaction agreements, and
allocated to principal, interest or other
items (e.g., escrow) in accordance with the
related asset pool documents.
1122(d)(4)(v) The Servicer's records regarding the accounts
and the accounts agree with the Servicer's
records with respect to an obligor's unpaid
principal balance.
1122(d)(4)(vi) Changes with respect to the terms or status
of an obligor's account (e.g., loan
modifications or re-agings) are made,
reviewed and approved by authorized personnel
in accordance with the transaction agreements
and related pool asset documents.
1122(d)(4)(vii) Loss mitigation or recovery actions (e.g.,
forbearance plans, modifications and deeds in
lieu of foreclosure, foreclosures and
repossessions, as applicable) are initiated,
conducted and concluded in accordance with
the timeframes or other requirements
established by the transaction agreements.
1122(d)(4)(viii)Records documenting collection efforts are
maintained during the period a Account is
delinquent in accordance with the transaction
agreements. Such records are maintained on at
least a monthly basis, or such other period
specified in the transaction agreements, and
describe the entity's activities in
monitoring delinquent Accounts including, for
example, phone calls, letters and payment
rescheduling plans in cases where delinquency
is deemed temporary (e.g., illness or
unemployment).
1122(d)(4)(ix) Adjustments to interest rates or rates of
return for Accounts with variable rates are
computed based on the related Account
documents.
1122(d)(4)(x) Regarding any funds held in trust for an
obligor (such as escrow accounts): (A) such
funds are analyzed, in accordance with the
obligor's Account documents, on at least an
annual basis, or such other period specified
in the transaction agreements; (B) interest
on such funds is paid, or credited, to
obligors in accordance with applicable
Account documents and state laws; and
(C) such funds are returned to the obligor
within 30 calendar days of full repayment of
the related Accounts, or such other number of
days specified in the transaction agreements.
1122(d)(4)(xi) Payments made on behalf of an obligor (such
as tax or insurance payments) are made on or
before the related penalty or expiration
dates, as indicated on the appropriate bills
or notices for such payments, provided that
such support has been received by the
servicer at least 30 calendar days prior to
these dates, or such other number of days
specified in the transaction agreements.
1122(d)(4)(xii) Any late payment penalties in connection with
any payment to be made on behalf of an
obligor are paid from the servicer's funds
and not charged to the obligor, unless the
late payment was due to the obligor's error
or omission.
1122(d)(4)(xiii)Disbursements made on behalf of an obligor
are posted within two business days to the
obligor's records maintained by the servicer,
or such other number of days specified in the
transaction agreements.
1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible
accounts are recognized and recorded in
accordance with the transaction agreements.
1122(d)(4)(xv) Any external enhancement or other support,
identified in Item 1114(a)(1) through (3) or
Item 1115 of Regulation AB, is maintained as
set forth in the transaction agreements.
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TABLE OF CONTENTS
Page
ARTICLE I Definitions...................................................1
Section 1.01 Definitions.............................................1
Section 1.02 Other Definitional Provisions...........................2
Section 1.03 Interest Calculations...................................2
ARTICLE II Representations and Warranties................................3
Section 2.01 Representations and Warranties Regarding the
Servicer................................................3
Section 2.02 Representations and Warranties of the Issuer............4
Section 2.03 Enforcement of Representations and Warranties...........4
ARTICLE III Administration and Servicing of Mortgage Loans................6
Section 3.01 The Servicer............................................6
Section 3.02 Collection of Certain Mortgage Loan Payments............8
Section 3.03 Withdrawals from the Custodial Account.................11
Section 3.04 Maintenance of Hazard Insurance; Property
Protection Expenses....................................13
Section 3.05 Modification Agreements................................14
Section 3.06 Trust Estate; Related Documents........................14
Section 3.07 Realization Upon Defaulted Mortgage Loans..............15
Section 3.08 Issuer and Indenture Trustee to Cooperate..............17
Section 3.09 Servicing Compensation; Payment of Certain
Expenses by Servicer...................................18
Section 3.10 Annual Statement as to Compliance......................18
Section 3.11 Annual Servicing Report................................18
Section 3.12 Access to Certain Documentation and Information
Regarding the Mortgage Loans...........................19
Section 3.13 Maintenance of Certain Servicing Insurance Policies....19
Section 3.14 Information Required by the Internal Revenue
Service and Reports of Foreclosures and
Abandonments of Mortgaged Property.....................19
Section 3.15 Optional Repurchase or Transfer of Mortgage Loans......19
Section 3.16 Funding Account........................................21
Section 3.18 [Pre-Funding Account...................................22
Section 3.19 [Capitalized Interest Account..........................24
Section 3.20 Enforcement of Due-on-Sale Clauses; Assumption and
Modification Agreements; Certain Assignments. .........24
Section 3.21 Advance Facility. .....................................26
ARTICLE IV Servicing Certificate........................................27
Section 4.01 Statements to Securityholders..........................27
Section 4.02 Tax Returns and 1934 Act Reports.......................30
ARTICLE V Note Payment Account.........................................32
Section 5.01 Note Payment Account...................................32
ARTICLE VI The Servicer.................................................33
Section 6.01 Liability of the Servicer..............................33
Section 6.02 Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer...........................33
Section 6.03 Limitation on Liability of the Servicer and Others.....33
Section 6.04 Servicer Not to Resign.................................34
Section 6.05 Delegation of Duties...................................34
Section 6.06 Payment of Indenture Trustee's and Owner Trustee's
Fees and Expenses; Indemnification.....................35
ARTICLE VII Default......................................................36
Section 7.01 Servicing Default......................................36
Section 7.02 Indenture Trustee to Act; Appointment of Successor.....37
Section 7.03 Notification to Securityholders........................40
ARTICLE VIII Compliance With Regulation AB................................41
Section 8.01 Intent of the Parties; Reasonableness..................41
Section 8.02 Additional Representations and Warranties of the
Indenture Trustee......................................41
Section 8.03 Information to Be Provided by the Indenture Trustee....42
Section 8.04 Report on Assessment of Compliance and Attestation.....42
Section 8.05 Indemnification; Remedies..............................42
ARTICLE IX Miscellaneous Provisions.....................................43
Section 9.01 Amendment..............................................43
Section 9.02 GOVERNING LAW..........................................43
Section 9.03 Notices................................................43
Section 9.04 Severability of Provisions.............................44
Section 9.05 Third-Party Beneficiaries..............................44
Section 9.06 Counterparts...........................................44
Section 9.07 Effect of Headings and Table of Contents...............44
Section 9.08 Termination Upon Purchase by the Servicer or
Liquidation of All Mortgage Loans; Partial
Redemption.............................................44
Section 9.09 Certain Matters Affecting the Indenture Trustee........45
Section 9.10 Owner Trustee Not Liable for Related Documents.........45
EXHIBIT A MORTGAGE LOAN SCHEDULE......................................A-1
EXHIBIT B LIMITED POWER OF ATTORNEY...................................B-1
EXHIBIT C FORM OF REQUEST FOR RELEASE.................................C-1
EXHIBIT D-1 FORM OF FORM 10-K CERTIFICATION...........................D-1-1
EXHIBIT D-2 FORM OF BACK-UP CERTIFICATION TO FORM 10-K
CERTIFICATE...............................................D-2-1
EXHIBIT E .....SERVICING CRITERIA TO BE ADDRESSED
IN ASSESSMENT OF COMPLIANCE.................................E-1