Exhibit 99.7
Execution
_______________________________________________________________________________
▇▇▇▇▇▇ BROTHERS BANK, FSB
Purchaser
and
GREENPOINT MORTGAGE FUNDING INC.
Seller
____________________________
FLOW MORTGAGE LOAN PURCHASE, WARRANTIES AND SERVICING AGREEMENT
Dated as of August 1, 2003
____________________________
Conventional Residential Adjustable and Fixed Rate Mortgage Loans
Group No. 2003-FLOW
_______________________________________________________________________________
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; POSSESSION OF MORTGAGE FILES;
BOOKS AND RECORDS; CUSTODIAL AGREEMENT;
DELIVERY OF DOCUMENTS
Section 2.01 Conveyance of Mortgage Loans; Possession of Mortgage
Files; Maintenance of Servicing Files................. 12
Section 2.02 Books and Records; Transfers of Mortgage Loans.......... 12
Section 2.03 Custodial Agreement; Delivery of Documents.............. 13
ARTICLE III
PURCHASE PRICE
ARTICLE IV
REPRESENTATIONS AND WARRANTIES;
REMEDIES AND BREACH
Section 4.01 Seller Representations and Warranties................... 15
Section 4.02 Representations and Warranties Regarding Individual
Mortgage Loans........................................ 17
Section 4.03 Remedies for Breach of Representations and Warranties... 29
Section 4.04 Post Closing Due Diligence.............................. 31
Section 4.05 Restrictions and Requirements Applicable in the Event
that a Mortgage Loan is Acquired by a REMIC........... 32
ARTICLE V
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 5.01 Seller to Act as Servicer............................... 34
Section 5.02 Liquidation of Mortgage Loans........................... 35
Section 5.03 Collection of Mortgage Loan Payments.................... 36
Section 5.04 Establishment of and Deposits to Custodial Account...... 36
Section 5.05 Permitted Withdrawals From Custodial Account............ 38
Section 5.06 Establishment of and Deposits to Escrow Account......... 39
Section 5.07 Permitted Withdrawals From Escrow Account............... 39
Section 5.08 Completion and Recordation of Assignment of Mortgage.... 40
Section 5.09 Payment of Taxes, Insurance and Other Charges........... 40
Section 5.10 Protection of Accounts.................................. 41
Section 5.11 Maintenance of Hazard Insurance......................... 41
Section 5.12 Maintenance of Mortgage Insurance....................... 43
Section 5.13 Maintenance of Fidelity Bond and Errors and Omissions
Insurance............................................. 44
Section 5.14 Inspections............................................. 44
Section 5.15 Restoration of Mortgaged Property....................... 44
Section 5.16 Maintenance of PMI and/or LPMI Policy; Claims........... 45
Section 5.17 Title, Management and Disposition of REO Property....... 46
Section 5.18 Real Estate Owned Reports............................... 48
Section 5.19 Liquidation Reports..................................... 48
Section 5.20 Notification of Adjustments............................. 48
Section 5.21 Reports of Foreclosures and Abandonments
of Mortgaged Property................................. 49
Section 5.22 Prepayment Charges...................................... 49
Section 5.23 Credit Reporting........................................ 49
Section 5.24 Safeguarding Customer Information....................... 49
ARTICLE VI
PAYMENTS TO PURCHASER
Section 6.01 Remittances............................................. 50
Section 6.02 Statements to Purchaser................................. 50
Section 6.03 Due Dates Other Than the First of the Month............. 51
Section 6.04 Monthly Advances by Seller.............................. 51
ARTICLE VII
GENERAL SERVICING PROCEDURES
Section 7.01 Transfers of Mortgaged Property......................... 52
Section 7.02 Satisfaction of Mortgages and Release of Mortgage Files. 52
Section 7.03 Servicing Compensation.................................. 53
Section 7.04 Annual Audit Report..................................... 53
Section 7.05 Annual Officer's Certificate............................ 54
Section 7.06 Right to Examine Seller Records......................... 54
-ii-
ARTICLE VIII
AGENCY TRANSFER; PASS-THROUGH TRANSFER
Section 8.01 Removal of Mortgage Loans from Inclusion Under this
Agreement Upon an Agency Transfer, or a Pass-Through
Transfer on One or More Reconstitution Dates.......... 54
Section 8.02 Transfer of Servicing Following Reconstitution.......... 56
Section 8.03 Purchaser's Repurchase and Indemnification Obligations.. 57
Section 8.04 Additional Indemnification by the Seller................ 58
Section 8.05 Transfer Of Servicing................................... 58
ARTICLE IX
THE SELLER
Section 9.01 Merger or Consolidation of the Seller................... 59
Section 9.02 Limitation on Liability of Seller and Others............ 59
Section 9.03 Limitation on Resignation and Assignment by Seller...... 59
Section 9.04 Limitation on Assignment by the Seller.................. 60
ARTICLE X
DEFAULT
Section 10.01 Events of Default....................................... 60
Section 10.02 Waiver of Defaults...................................... 62
ARTICLE XI
TERMINATION
Section 11.01 Termination............................................. 62
Section 11.02 Termination Without Cause............................... 62
ARTICLE XII
Miscellaneous Provisions
Section 12.01 Successor to Seller..................................... 63
Section 12.02 Amendment............................................... 64
Section 12.03 Closing................................................. 64
Section 12.04 Closing Documents....................................... 65
Section 12.05 Costs................................................... 66
Section 12.06 Governing Law........................................... 67
Section 12.07 Duration of Agreement................................... 67
-iii-
Section 12.08 Notices................................................. 67
Section 12.09 Severability of Provisions.............................. 67
Section 12.10 Relationship of Parties................................. 68
Section 12.11 Execution; Successors and Assigns....................... 68
Section 12.12 Recordation of Assignments of Mortgage.................. 68
Section 12.13 Assignment by Purchaser................................. 69
Section 12.14 No Personal Solicitation................................ 69
Section 12.15 Confidential Information................................ 69
Section 12.16 Appointment and Designation of Master Servicer.......... 71
Section 12.17 Waivers; Other Agreements............................... 71
Section 12.18 Exhibits................................................ 71
Section 12.19 General Interpretive Principles......................... 71
EXHIBITS
EXHIBIT A-1 ACKNOWLEDGMENT AND CONVEYANCE AGREEMENT
EXHIBIT A-2 MORTGAGE LOAN SCHEDULE DATA FIELDS
EXHIBIT B CONTENTS OF EACH MORTGAGE FILE
EXHIBIT C RESERVED
EXHIBIT D-1 FORM OF CUSTODIAL ACCOUNT CERTIFICATION
EXHIBIT D-2 FORM OF CUSTODIAL ACCOUNT LETTER AGREEMENT
EXHIBIT E-1 FORM OF ESCROW ACCOUNT CERTIFICATION
EXHIBIT E-2 FORM OF ESCROW ACCOUNT LETTER AGREEMENT
EXHIBIT F-1 FORM OF MONTHLY REMITTANCE ADVICE
EXHIBIT F-2 STANDARD LAYOUT FOR DEFAULTED LOAN REPORT
EXHIBIT G FORM OF ASSIGNMENT AND ASSUMPTION
EXHIBIT H SELLER'S OFFICER'S CERTIFICATE
EXHIBIT I FORM OF OPINION OF COUNSEL TO SELLER
EXHIBIT J-1 SECURITY RELEASE CERTIFICATION
EXHIBIT J-2 SECURITY RELEASE CERTIFICATION
-iv-
This is a Flow Mortgage Loan Purchase, Warranties and Servicing Agreement
for residential conventional adjustable rate first lien and fixed rate first
and second lien mortgage loans, dated and effective as of August 1, 2003, and
is executed between ▇▇▇▇▇▇ Brothers Bank, FSB, as purchaser (the "Purchaser")
and Greenpoint Mortgage Funding Inc., as seller (the "Seller").
W I T N E S S E T H:
WHEREAS, the Seller has agreed to sell from time to time to the Purchaser,
and the Purchaser has agreed to purchase from time to time from the Seller,
certain fixed and adjustable rate residential first and second lien mortgage
loans (the "Mortgage Loans") on a servicing retained basis as described
herein, and which shall be delivered as whole loans on the related Closing
Date, as defined below;
WHEREAS, each Mortgage Loan will be secured by a mortgage, deed of trust
or other security instrument creating a first or second lien on a residential
dwelling located in the jurisdiction indicated on the related Mortgage Loan
Schedule; and
WHEREAS, the Purchaser and the Seller wish to prescribe the manner of the
conveyance, servicing and control of the Mortgage Loans.
NOW, THEREFORE, in consideration of the premises and mutual agreements set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Purchaser and the Seller
agree as follows:
ARTICLE I
DEFINITIONS
Whenever used herein, the following words and phrases, unless the context
otherwise requires, shall have the following meanings:
Accepted Servicing Practices: With respect to any Mortgage Loan, those
mortgage servicing practices of prudent mortgage lending institutions which
service mortgage loans of the same type as such Mortgage Loan in the
jurisdiction where the related Mortgaged Property is located.
Acknowledgment and Conveyance Agreement: The agreement, substantially in
the form of Exhibit A-1 hereto, to be executed by the Seller and the Purchaser
on each Closing Date.
Agency Transfer: The sale or transfer by Purchaser of some or all of the
Mortgage Loans to ▇▇▇▇▇▇ ▇▇▇ under its Cash Purchase Program or its MBS Swap
Program
-1-
(Special Servicing Option) or to ▇▇▇▇▇▇▇ Mac under its ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇
Program or Gold PC Program, retaining the Seller as "servicer thereunder".
Agreement: This Flow Mortgage Loan Purchase, Warranties and Servicing
Agreement and all amendments hereof and supplements hereto.
ALTA: The American Land Title Association or any successor thereto.
Ancillary Income: All income derived from the Mortgage Loans, excluding
Servicing Fees and Prepayment Charges attributable to the Mortgage Loans,
including but not limited to, late charges, fees received with respect to
checks or bank drafts returned by the related bank for non-sufficient funds,
assumption fees, optional insurance administrative fees and all other
incidental fees and charges. The Seller shall retain all Ancillary Income to
the extent not required to be deposited into the Custodial Account.
Appraised Value: The value set forth in an appraisal made in connection
with the origination of the related Mortgage Loan as the value of the
Mortgaged Property.
Approved Flood Policy Insurer: Any of the following insurers: Flood Data
Services, Inc., Flood Zone, Inc., GEOTrac or Transamerica Flood Hazard
Certification.
Approved Tax Service Contract Provider: Any of the following providers:
First American, TransAmerica, Lereta or Fidelity.
ARM Mortgage Loan: A Mortgage Loan pursuant to which the interest rate
shall be adjusted from time to time in accordance with the related Mortgage
Note.
Assignment of Mortgage: An assignment of the Mortgage, notice of transfer
or equivalent instrument in recordable form, sufficient under the laws of the
jurisdiction wherein the related Mortgaged Property is located to reflect the
sale of the Mortgage to the Purchaser, or in the case of a MERS Mortgage Loan,
a confirmed electronic transmission to MERS, identifying a transfer of
ownership of the related Mortgage to the Purchaser or its designee.
BIF: The Bank Insurance Fund, or any successor thereto.
BPO: A broker's price opinion obtained by the Purchaser.
Business Day: Any day other than (i) a Saturday or Sunday, or (ii) a day
on which banking and savings and loan institutions in the State of New York
are authorized or obligated by law or executive order to be closed.
Closing Date: Means a date on which the Seller shall sell and the
Purchaser shall purchase Mortgage Loans under this Agreement as set forth in
the related Purchase Price and Terms Agreement.
Code: The Internal Revenue Code of 1986, as it may be amended from time to
time or any successor statute thereto, and applicable U.S. Department of the
Treasury regulations issued pursuant thereto.
-2-
Combined Loan-to-Value Ratio or CLTV: With respect to any Second Lien
Mortgage Loan, the ratio of (a) the sum of (i) the outstanding principal
balance of the Mortgage Loan at origination and (ii) the original principal
amount of any related First Lien (as of the Cut-off Date)(unless otherwise
indicated) and (b) the lesser of (i) the Appraised Value of the Mortgaged
Property and (ii) if the Mortgage Loan was made to finance the acquisition of
the related Mortgaged Property, the purchase price of the Mortgaged Property,
expressed as a percentage.
Condemnation Proceeds: All awards or settlements in respect of a Mortgaged
Property, whether permanent or temporary, partial or entire, by exercise of
the power of eminent domain or condemnation, to the extent not required to be
released to a Mortgagor in accordance with the terms of the related Mortgage
Loan Documents.
Credit Grade: As defined in the Underwriting Guidelines.
Custodial Account: The separate account or accounts created and maintained
pursuant to Section 4.04.
Custodial Agreement: The agreement governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other
Mortgage Loan Documents.
Custodian: The custodian under the Custodial Agreement, or its successor
in interest or assigns, or any successor to the Custodian under the Custodial
Agreement, as therein provided.
Cut-off Date: With respect to any Mortgage Loan purchased on a Closing
Date, the first day of the month in which the related Closing Date occurs, or
such other date as may be set forth in the related Purchase Price and Terms
Agreement.
Deleted Mortgage Loan: A Mortgage Loan which is repurchased by the Seller
in accordance with the terms of this Agreement.
Determination Date: The last day (or if such last day is not a Business
Day, the Business Day immediately preceding such last day) of the month
immediately preceding the month of the related Remittance Date.
Disqualified Organization: An organization defined as such in Section
860E(e) of the Code.
Due Date: The day of the month on which the Monthly Payment is due on a
Mortgage Loan, exclusive of any days of grace. With respect to the Mortgage
Loans for which payment from the Mortgagor is due on a day other than the
first day of the month, such Mortgage Loans will be treated as if the Monthly
Payment is due on the first day of the month following the actual Due Date.
Due Period: With respect to each Remittance Date, the period commencing on
the second day of the month preceding the month of the Remittance Date and
ending on the first day of the month of the Remittance Date.
-3-
Eligible Investments: Any one or more of the obligations and securities
listed below which investment provides for a date of maturity not later than
the Determination Date in each month:
(a) direct obligations of, and obligations fully guaranteed by, the United
States of America, or any agency or instrumentality of the United States of
America the obligations of which are backed by the full faith and credit of
the United States of America; and
(b) federal funds, demand and time deposits in, certificates of deposits
of, or bankers' acceptances issued by, any depository institution or trust
company incorporated or organized under the laws of the United States of
America or any state thereof and subject to supervision and examination by
federal and/or state banking authorities, so long as at the time of such
investment or contractual commitment providing for such investment the
commercial paper or other short-term debt obligations of such depository
institution or trust company (or, in the case of a depository institution or
trust company which is the principal subsidiary of a holding company, the
commercial paper or other short-term debt obligations of such holding company)
are rated "P-1" by ▇▇▇▇▇'▇ and the long-term debt obligations of such holding
company) are rated "P-1" by ▇▇▇▇▇'▇ and the long-term debt obligations of such
depository institution or trust company (or, in the case of a depository
institution or trust company which is the principal subsidiary of a holding
company, the long-term debt obligations of such holding company) are rated at
least "Aa" by ▇▇▇▇▇'▇;
provided, however, that no such instrument shall be an Eligible Investment
if such instrument evidences either (i) a right to receive only interest
payments with respect to the obligations underlying such instrument, or (ii)
both principal and interest payments derived from obligations underlying such
instrument and the principal and interest payments with respect to such
instrument provide a yield to maturity of greater than 120% of the yield to
maturity at par of such underlying obligations; provided, further, that upon a
Pass-Through Transfer, the Eligible Investments permitted thereunder shall be
set forth in the related Reconstitution Agreement.
Notwithstanding anything herein to the contrary, with respect to Mortgage
Loans subject to an Agency Transfer or a Pass-Through Transfer, in the event
that the applicable Reconstitution Agreement has a more limiting definition of
"Eligible Investments", then the definition contained in such Reconstitution
Agreement shall apply to such Mortgage Loans.
Errors and Omissions Insurance Policy: An errors and omissions insurance
policy to be maintained by the Seller pursuant to Section 5.13.
Escrow Account: The separate account or accounts created and maintained
pursuant to Section 5.06.
Escrow Payments: With respect to any Mortgage Loan, the amounts
constituting ground rents, taxes, assessments, water rates, sewer rents,
municipal charges, mortgage insurance premiums, fire and hazard insurance
premiums, condominium charges, and any other payments required to be escrowed
by the Mortgagor with the mortgagee pursuant to the Mortgage or any other
related document.
-4-
Event of Default: Any one of the conditions or circumstances enumerated in
Section 10.01.
▇▇▇▇▇▇ Mae: The Federal National Mortgage Association, or any successor
thereto.
▇▇▇▇▇▇ ▇▇▇ Guides: The ▇▇▇▇▇▇ Mae Selling Guide and the ▇▇▇▇▇▇ ▇▇▇
Servicing Guide and all amendments or additions thereto.
FDIC: The Federal Deposit Insurance Corporation, or any successor thereto.
FICO Score: shall mean the Mortgagor's FICO score calculated as the lower
of two scores or the middle of three scores.
Fidelity Bond: A fidelity bond to be maintained by the Seller pursuant to
Section 4.12.
First Lien: With respect to any Second Lien Mortgage Loan, the mortgage
loan relating to the corresponding Mortgaged Property having a first priority
lien.
▇▇▇▇▇▇▇ Mac: The Federal Home Loan Mortgage Corporation, or any successor
thereto.
Gross Margin: With respect to each ARM Mortgage Loan, the fixed percentage
amount set forth in the related Mortgage Note which amount is added to the
Index in accordance with the terms of the related Mortgage Note to determine,
on each Interest Rate Adjustment Date, the Mortgage Interest Rate for such
Mortgage Loan.
Index: With respect to each ARM Mortgage Loan, the applicable rate, on
each Interest Rate Adjustment Date, which shall be adjusted semi-annually
based upon the rate per annum equal to the average of interbank offered rates
for six-month U.S. Dollar Denominated deposits in the London Market (LIBOR) as
published in the Wall Street Journal.
Initial Mortgage Interest Rate Cap: With respect to each ARM Mortgage
Loan, the limit on the initial Mortgage Interest Rate adjustment such that, as
to each Mortgage Loan on the initial Interest Rate Adjustment Date, no change
in the Mortgage Interest Rate shall exceed 3% above the Mortgage Interest Rate
in effect immediately prior to the initial Interest Rate Adjustment Date of
the related Mortgage Loan.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged
Property.
Interest Rate Adjustment Date: With respect to each ARM Mortgage Loan, the
date on which an adjustment to the Mortgage Interest Rate on a Mortgage Note
becomes effective.
Lifetime Rate Cap: With respect to each ARM Mortgage Loan, the provision
of each Mortgage Note which provides for an absolute maximum Mortgage Interest
Rate
-5-
thereunder, as set forth on the Mortgage Loan Schedule. The Mortgage Interest
Rate during the term of each Mortgage Loan shall not at any time exceed the
Mortgage Interest Rate at the time of origination of such Mortgage Loan by
more than the amount per annum set forth on the Mortgage Loan Schedule.
Liquidation Proceeds: Cash received in connection with the liquidation of
a defaulted Mortgage Loan, whether through the sale or assignment of such
Mortgage Loan, trustee's sale, foreclosure sale or otherwise, or the sale of
the related Mortgaged Property if the Mortgaged Property is acquired in
satisfaction of the Mortgage Loan.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan, the ratio
of the original principal amount of the Mortgage Loan at origination to the
lesser of (a) the Appraised Value of the Mortgaged Property and (b) if the
Mortgage Loan was made to finance the acquisition of the related Mortgaged
Property, the purchase price of the Mortgaged Property, expressed as a
percentage.
Master Servicer: As such term is defined in Section 3.16.
Monthly Advance: With respect to each Remittance Date and each Mortgage
Loan following Reconstitution, an amount equal to the Monthly Payment (with
the interest portion of such Monthly Payment adjusted to the Mortgage Loan
Remittance Rate) which was due on the Mortgage Loan on the Due Date in the
related Due Period, and (i) which was delinquent at the close of business on
the immediately preceding Determination Date and (ii) which was not the
subject of a previous Monthly Advance.
Monthly Payment: The scheduled monthly payment of principal and interest
on a Mortgage Loan.
Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note, which creates a first or second lien on an unsubordinated
estate in fee simple or leasehold estate in real property securing the
Mortgage Note.
Mortgage File: The items pertaining to a particular Mortgage Loan referred
to in Exhibit B annexed hereto, and any additional documents required to be
added to the Mortgage File pursuant to this Agreement.
Mortgage Insurance Policy: A mortgage blanket hazard insurance policy as
described in Section 5.12.
Mortgage Interest Rate: The annual rate of interest borne on a Mortgage
Note, which, with respect to each ARM Mortgage Loan, is adjusted from time to
time in accordance with the provisions of the Mortgage Note, without regard to
any modification of the Mortgage Note.
Mortgage Interest Rate Cap: With respect to each ARM Mortgage Loan, the
limit on each Mortgage Interest Rate adjustment as set forth in the related
Mortgage Note.
-6-
Mortgage Loan: An individual Mortgage Loan which is the subject of this
Agreement, each Mortgage Loan originally sold and subject to this Agreement
being identified on the Mortgage Loan Schedule annexed as Annex 1 to the
related Acknowledgment and Conveyance Agreement, which Mortgage Loan includes
without limitation the Mortgage File, the Monthly Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
REO Disposition Proceeds, Servicing Rights and all other rights, benefits,
proceeds and obligations arising from or in connection with such Mortgage
Loan.
Mortgage Loan Documents: The documents listed in Exhibit B hereto.
Mortgage Loan Package: A group of Mortgage Loans sold to the Purchaser by
the Seller on a Closing Date and set forth on the Mortgage Loan Schedule
annexed to the related Acknowledgment and Conveyance Agreement.
Mortgage Loan Remittance Rate: With respect to each Mortgage Loan, the
annual rate of interest remitted to the Purchaser, which shall be equal to the
Mortgage Interest Rate minus the Servicing Fee Rate.
Mortgage Loan Schedule: A schedule of Mortgage Loans annexed as Annex 1 to
each Acknowledgment and Conveyance Agreement, each such schedule setting forth
the data and information listed on Exhibit A-2 with respect to each Mortgage
Loan.
Mortgage Note: The Mortgage Note or other evidence of the indebtedness of
a Mortgagor secured by a Mortgage.
Mortgaged Property: The real property securing repayment of the debt
evidenced by a Mortgage Note.
Mortgagor: The obligor on a Mortgage Note.
Notice of Intent: As defined in Section 4.02 hereof.
Officer's Certificate: A certificate signed by the Chairman of the Board,
the Vice Chairman of the Board, the President or a Vice President and by the
Treasurer, the Secretary or one of the Assistant Treasurers or Assistant
Secretaries of the Seller, and delivered to the Purchaser as required by this
Agreement.
Opinion of Counsel: A written opinion of counsel, who may be an employee
of the Seller, reasonably acceptable to the Purchaser, provided that any
Opinion of Counsel relating to (a) qualification of the Mortgage Loans in a
REMIC or (b) compliance with the REMIC Provisions, must be an opinion of
counsel who (i) is in fact independent of the Seller and any Master Servicer
of the Mortgage Loans, (ii) does not have any material direct or indirect
financial interest in the Seller or any Master Servicer of the Mortgage Loans
or in an affiliate of any such entity and (iii) is not connected with the
Seller or any Master Servicer of the Mortgage Loans as an officer, employee,
director or person performing similar functions.
Pass-Through Transfer: The sale or transfer of some or all of the Mortgage
Loans to a trust to be formed as part of a publicly-issued and/or privately
placed, rated or unrated,
-7-
mortgage pass-through transaction, retaining the Seller as "servicer" (with or
without a Master Servicer) thereunder.
Periodic Rate Cap: With respect to each ARM Mortgage Loan, the provision
of each Mortgage Note which provides for an absolute maximum amount by which
the Mortgage Interest Rate therein may increase on an Interest Rate Adjustment
Date above the Mortgage Interest Rate previously in effect. The Periodic Rate
Cap for each ARM Mortgage Loan is the rate set forth on the related Mortgage
Loan Schedule.
Person: Any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof.
Prepayment Charge: With respect to any Mortgage Loan and Remittance Date,
the charges or premiums, if any, due in connection with a full or partial
prepayment of such Mortgage Loan during the immediately preceding Principal
Prepayment Period in accordance with the terms of the related Mortgage Note.
Prepayment Interest Shortfall Amount: With respect to any Mortgage Loan
that was subject to a Principal Prepayment in full during any Due Period,
which Principal Prepayment was applied to such Mortgage Loan prior to such
Mortgage Loan's Due Date in such Due Period, the amount of interest (net the
related Servicing Fee) that would have accrued on the amount of such Principal
Prepayment during the period commencing on the date as of which such Principal
Prepayment was applied to such Mortgage Loan and ending on the day immediately
preceding such Due Date, inclusive.
Principal Prepayment: Any payment or other recovery of principal on a
Mortgage Loan which is received in advance of its scheduled Due Date,
including any Prepayment Charge or premium thereon and which is not
accompanied by an amount of interest representing scheduled interest due on
any date or dates in any month or months subsequent to the month of
prepayment.
Prime Rate: The prime rate announced to be in effect from time to time, as
published as the average rate in The Wall Street Journal.
Purchase Price: The price paid on the related Closing Date by the
Purchaser to the Seller in exchange for the Mortgage Loans as calculated in
Article III of this Agreement.
Purchase Price and Terms Agreement: With respect to each purchase of a
Mortgage Loan Package hereunder, that certain letter agreement by and between
the Seller and the Purchaser setting forth the general terms, conditions and
portfolio characteristics for each Mortgage Loan Package to be purchased
hereunder as of any Closing Date.
Purchaser: ▇▇▇▇▇▇ Brothers Bank, FSB or its successor in interest or any
successor to the Purchaser under this Agreement as herein provided.
Qualified Appraiser: An appraiser who had no interest, direct or indirect,
in the Mortgaged Property or in any loan made on the security thereof, and
whose compensation is not
-8-
affected by the approval or disapproval of the Mortgage Loan, and such
appraiser and the appraisal made by such appraiser both satisfy the
requirements of Title XI of the Federal Institutions Reform, Recovery and
Enforcement Act of 1989 and the regulations promulgated thereunder, all as in
effect on the date the Mortgage Loan was originated.
Qualified Depository: A depository the accounts of which are insured by
the FDIC through the BIF or the SAIF and the debt obligations of which are
rated AA or better by Standard & Poor's Corporation.
Qualified Insurer: A mortgage guaranty insurance company duly authorized
and licensed where required by law to transact mortgage guaranty insurance
business and approved as an insurer by ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac.
Rating Agency: Any of Fitch, Inc., ▇▇▇▇▇'▇ Investors Service, Inc. or
Standard & Poor's Rating Services, A Division of The ▇▇▇▇▇▇-▇▇▇▇ Companies,
Inc., or their respective successors.
Reconstitution: A Pass-Through Transfer, a Whole Loan Transfer or an
Agency Transfer.
Reconstitution Agreements: The agreement or agreements entered into by the
Purchaser, the Seller, ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac or certain third parties on
the Reconstitution Date(s) with respect to any or all of the Mortgage Loans
serviced hereunder, in connection with a Pass-Through Transfer or an Agency
Transfer as set forth in Section 7.01, including, but not limited to, (i) a
▇▇▇▇▇▇ Mae Mortgage Selling and Servicing Contract, a Pool Purchase Contract,
and any and all servicing agreements and tri-party agreements reasonably
required by ▇▇▇▇▇▇ ▇▇▇ with respect to a ▇▇▇▇▇▇ Mae Transfer, (ii) a Purchase
Contract and all purchase documents associated therewith as set forth in the
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇' & Servicers' Guide, and any and all servicing agreements
and tri-party agreements reasonably required by ▇▇▇▇▇▇▇ Mac with respect to a
▇▇▇▇▇▇▇ Mac Transfer, and (iii) a Pooling and Servicing Agreement and/or a
subservicing/master servicing agreement and related custodial/trust agreement
and related documents with respect to a Pass-Through Transfer. Such agreement
or agreements shall prescribe the rights and obligations of the Seller in
servicing the related Mortgage Loans and shall provide for servicing
compensation to the Seller (calculated on a weighted average basis for all the
related Mortgage Loans as of the Reconstitution Date), net of any guarantee
fees due ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, if applicable, at least equal to the
Servicing Fee due the Seller in accordance with this Agreement or the
servicing fee required pursuant to the Reconstitution Agreement, whichever is
greater.
Reconstitution Date: The date or dates on which any or all of the Mortgage
Loans serviced under this Agreement shall be removed from this Agreement and
reconstituted as part of an Agency Transfer or a Pass-Through Transfer
pursuant to Section 8.01 hereof. On such date or dates, the Mortgage Loans
transferred shall cease to be covered by this Agreement and the Seller's
servicing responsibilities (but not its obligations as Seller and originator
hereunder) shall cease under this Agreement with respect to the related
transferred Mortgage Loans.
-9-
REMIC: A "real estate mortgage investment conduit" within the meaning of
Section 860D of the Code.
REMIC Documents: The document or documents creating and governing the
administration of a REMIC.
REMIC Eligible Mortgage Loan: A Mortgage Loan held by a REMIC which
satisfies and/or complies with all applicable REMIC Provisions.
REMIC Provisions: Provisions of the federal income tax law relating to a
REMIC, which appear at Section 860A through 86OG of Subchapter M of Chapter 1,
Subtitle A of the Code, and related provisions, and regulations, rulings or
pronouncements promulgated thereunder, as the foregoing may be in effect from
time to time.
Remittance Date: The 18th day (or if such 18th day is not a Business Day,
the first Business Day immediately preceding) of any month.
REO Disposition: The final sale by the Seller of any REO Property.
REO Disposition Proceeds: All amounts received with respect to an REO
Disposition pursuant to Section 5.17.
REO Property: A Mortgaged Property acquired by the Seller on behalf of the
Purchaser through foreclosure or by deed in lieu of foreclosure, as described
in Section 5.17.
Repurchase Price: With respect to any Mortgage Loan, a price equal to (a)
the Stated Principal Balance of the Mortgage Loan plus (b) interest on such
Stated Principal Balance at the Mortgage Interest Rate from the date on which
interest has last been paid and distributed to the Purchaser to the date of
repurchase, less amounts received, if any, plus amounts advanced, if any, by
any servicer, in respect of such repurchased Mortgage Loan.
SAIF: The Savings Association Insurance Fund, or any successor thereto.
Securities Act of 1933 or the 1933 Act: The Securities Act of 1933, as
amended.
Second Lien Mortgage Loan: A Mortgage Loan secured by a second lien on the
related Mortgaged Property.
Seller: Greenpoint Mortgage Funding Inc. and its successors and assigns.
Servicing Advances: All customary, reasonable and necessary "out of
pocket" costs and expenses other than Monthly Advances (including reasonable
attorneys' fees and disbursements) incurred in the performance by the Seller
of its servicing obligations, including, but not limited to, the cost of (a)
the preservation, restoration, protection and inspection of the Mortgaged
Property, (b) any enforcement or judicial proceedings, including foreclosures,
(c) the management and liquidation of any REO Property and (d) compliance with
the obligations under Section 5.01. 5.02, 5.08, 5.11, 5.14 and 5.15.
-10-
Servicing Fee: With respect to each Mortgage Loan, the amount of the
annual fee the Purchaser shall pay to the Seller, which shall, for a period of
one full month, be equal to one-twelfth of the product of (a) the Servicing
Fee Rate and (b) the outstanding principal balance of such Mortgage Loan. Such
fee shall be payable monthly, computed on the basis of the same principal
amount and period respecting which any related interest payment on a Mortgage
Loan is computed. The obligation of the Purchaser to pay the Servicing Fee is
limited to, and the Servicing Fee is payable solely from, the interest portion
(including recoveries with respect to interest from Liquidation, Condemnation
or Insurance Proceeds) of such Monthly Payment collected by the Seller.
Servicing Fee Rate: 0.25% per annum.
Servicing File: With respect to each Mortgage Loan, the file retained by
the Seller consisting of originals of all documents in the Mortgage File which
are not delivered to the Custodian and copies of the Mortgage Loan Documents
listed in Exhibit B the originals of which are delivered to the Custodian
pursuant to Section 2.03.
Servicing Officer: Any officer of the Seller involved in or responsible
for, the administration and servicing of the Mortgage Loans whose name appears
on a list of servicing officers furnished by the Seller to the Purchaser upon
request, as such list may from time to time be amended.
Stated Principal Balance: As to each Mortgage Loan, (a) the principal
balance of the Mortgage Loan at the related Cut-off Date after giving effect
to payments of principal received on or before such date, minus (b) all
amounts previously distributed to the Purchaser with respect to the related
Mortgage Loan representing payments or recoveries of principal or advances in
lieu thereof.
Tax Returns: The federal income tax return on Internal Revenue Service
Form 1066, U.S. Real Estate Mortgage Investment Conduit Income Tax Return,
including Schedule Q thereto, Quarterly Notice to Residual Interest Holders of
REMIC Taxable Income or Net Loss Allocation, or any successor forms, to be
filed on behalf of any REMIC under the REMIC Provisions, together with any and
all other information, reports or returns that may be required to be furnished
to the certificate holders under a REMIC or filed with the Internal Revenue
Service or any other governmental taxing authority under any applicable
provisions of federal, state or local tax laws.
Texas Home Equity Loan: An extension of credit described in Section
50(a)(6), Article XVI of the Texas Constitution.
Underwriting Guidelines. The underwriting guidelines of the Seller
attached as Annex 3 to the related Acknowledgment and Conveyance Agreement.
Whole Loan Transfer: The sale or transfer of some or all of the Mortgage
Loans to a third party purchaser in a whole loan transaction pursuant to a
loan purchase, warranties and servicing agreement or a participation and
servicing agreement, or similar agreement, retaining the Seller as "servicer"
thereunder.
-11-
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; POSSESSION OF MORTGAGE FILES;
BOOKS AND RECORDS; CUSTODIAL AGREEMENT;
DELIVERY OF DOCUMENTS
Section 2.01 Conveyance of Mortgage Loans; Possession of Mortgage Files;
Maintenance of Servicing Files.
On each Closing Date, the Seller, simultaneously with the execution and
delivery of the related Acknowledgment and Conveyance Agreement, does hereby
sell, transfer, assign, set over and convey to the Purchaser, without
recourse, but subject to the terms of this Agreement, all right, title and
interest of the Seller in and to the Mortgage Loans included in the related
Mortgage Loan Package, together with Mortgage Files and all rights and
obligations arising under the documents contained therein for each Mortgage
Loan. Pursuant to Section 2.03 hereof, on or prior to each Closing Date, the
Seller shall deliver the Mortgage File for each Mortgage Loan included in the
related Mortgage Loan Package to the Purchaser or its designee. The contents
of each Servicing File not delivered to the Purchaser are and shall be held in
trust by the Seller for the benefit of Purchaser as the owner thereof. The
Seller's possession of any portion of the Servicing File is at the will of the
Purchaser for the sole purpose of facilitating servicing of the related
Mortgage Loan, and such retention and possession by the Seller shall be in a
custodial capacity only. The ownership of each Mortgage Note, Mortgage, and
the contents of the Mortgage File and Servicing File is vested in the
Purchaser and the ownership of all records and documents with respect to the
related Mortgage Loan prepared by or which come into the possession of the
Seller shall immediately vest in the Purchaser and shall be retained and
maintained, in trust, by the Seller at the will of the Purchaser in such
custodial capacity only. The Servicing File retained by the Seller shall be
segregated from the other books and records of the Seller and shall be
appropriately marked to clearly reflect the sale of the related Mortgage Loan
to the Purchaser. The Seller shall release from its custody the contents of
any Servicing File retained by it only in accordance with the written
instructions from the Purchaser, unless such release is required as incidental
to the Seller's servicing the Mortgage Loans pursuant hereto or is in
connection with a repurchase of any Mortgage Loan pursuant hereto.
Section 2.02 Books and Records; Transfers of Mortgage Loans.
Record title to each Mortgage and the related Mortgage Note as of the
applicable Closing Date shall be in the name of the Purchaser or as Purchaser
shall designate. All rights arising out of the Mortgage Loans including, but
not limited to, all funds received by the Seller after the related Cut-off
Date on or in connection with a Mortgage Loan shall be vested in the
Purchaser; provided, however, that all funds received on or in connection with
a Mortgage Loan shall be received and held by the Seller in trust for the
benefit of the Purchaser as the owner of the Mortgage Loans for the sole
purpose of facilitating the servicing and the supervision of the servicing of
the Mortgage Loans.
-12-
The sale of each Mortgage Loan shall be reflected on the Seller's balance
sheet and other financial statements as a sale of assets by the Seller. The
Seller shall be responsible for maintaining, and shall maintain, a complete
set of books and records for each Mortgage Loan which shall be marked clearly
to reflect the ownership of each Mortgage Loan by the Purchaser. In
particular, the Seller shall maintain in its possession, available for
inspection by the Purchaser, or its designee and shall deliver to the
Purchaser upon demand, evidence of compliance with all federal, state and
local laws, rules and regulations, including but not limited to documentation
as to the method used in determining the applicability of the provisions of
the Flood Disaster Protection Act of 1973, as amended, to the Mortgaged
Property, documentation evidencing insurance coverage and periodic inspection
reports as required by Section 5.14. To the extent that original documents are
not required for purposes of realization of Liquidation Proceeds, Condemnation
Proceeds or Insurance Proceeds, documents maintained by the Seller may be in
the form of microfilm or microfiche or such other reliable means of recreating
original documents, including but not limited to, optical imagery techniques.
The Seller shall maintain with respect to each Mortgage Loan and shall
make available for inspection by any Purchaser or its designee the related
Servicing File during the time the Purchaser retains ownership of a Mortgage
Loan and thereafter in accordance with applicable laws and regulations.
Section 2.03 Custodial Agreement; Delivery of Documents.
No later than the date set forth in the related Purchase Price and Terms
Agreement, the Seller shall deliver to the Custodian those Mortgage Loan
Documents as required by this Agreement with respect to each Mortgage Loan
included in the related Mortgage Loan Package, a list of which is attached as
Exhibit B hereto. On or prior to the related Closing Date, the Custodian shall
have certified its receipt of all such Mortgage Loan Documents required to be
delivered pursuant to the Custodial Agreement, as evidenced by the initial
certification of the Custodian in the form annexed to the Custodial Agreement.
The Purchaser shall be responsible for maintaining the Custodial Agreement and
shall pay all fees and expenses of the Custodian. On the related Closing Date,
the Seller shall release any interest that it has in the Mortgage Loan
Documents upon its receipt of the Purchase Price for the Mortgage Loans.
Within thirty (30) days of receipt by the Seller of any notice from the
Purchaser or the Custodian that any of the Mortgage Loan Documents is missing,
does not appear regular on its face (i.e., is mutilated, damaged, defaced,
torn or otherwise physically altered) or appears to be unrelated to the
Mortgage Loans identified in the Mortgage Loan Schedule (each, a "Material
Defect"), the Seller shall cure such Material Defect (and, in such event, the
Seller shall provide the Purchaser with an Officer's Certificate confirming
that such cure has been effected). If the Seller does not so cure such
Material Defect, it shall, if such Material Defect would under Accepted
Servicing Practices reasonably be expected to result in a loss, repurchase the
related Mortgage Loan at the Repurchase Price. A loss shall be deemed to be
attributable to the failure of the Seller to cure a Material Defect if, as
determined by the Purchaser acting in good faith, absent such Material Defect,
such loss would not have been incurred. In addition to such repurchase
obligation, the Seller shall indemnify the Purchaser and hold it harmless
against any losses, damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs, judgments, and other costs and
expenses resulting from any missing, mutilated or improper Mortgage Loan
Document, or any claim, demand, defense or assertion based on or grounded
upon, or resulting therefrom, as
-13-
well as for any expenses reasonably incurred by the Purchaser in enforcing its
remedies hereunder in connection with any missing, mutilated or improper
Mortgage Loan Document.
The Seller shall forward to the Custodian original documents evidencing an
assumption, modification, consolidation or extension of any Mortgage Loan
entered into in accordance with Section 5.01 or 7.01 within one week of their
execution, provided, however, that the Seller shall provide the Custodian and
the Purchaser or its designee with a certified true copy of any such document
submitted for recordation within one week of its execution, and shall provide
the original of any document submitted for recordation or a copy of such
document certified by the appropriate public recording office to be a true and
complete copy of the original within sixty days of its submission for
recordation.
The Seller shall deliver a final Mortgage Loan Schedule for the Mortgage
Loans included in any Mortgage Loan Package to be purchased on any Closing
Date to the Purchaser no later than the date set forth in the related Purchase
Price and Terms Agreement.
ARTICLE III
PURCHASE PRICE
The Purchase Price shall be the percentage of par as stated in the related
Purchase Price and Terms Agreement (subject to the adjustments as provided
therein), multiplied by the aggregate Stated Principal Balance of the Mortgage
Loans included in the related Mortgage Loan Package. Notwithstanding the
foregoing, if a Mortgage Loan prepays in full between the related Cut-off Date
and the related Closing Date, inclusive, the Seller shall either remove such
Mortgage Loan from the Mortgage Loan Schedule or reimburse the Purchaser for
the premium over par which the Purchaser paid within five (5) days of the
related Closing Date. In addition, Purchaser will not purchase any Mortgage
Loan that has not made a payment as of the date set forth in the related
Purchase Price and Terms Agreement. The initial principal amount of the
Mortgage Loans shall be the aggregate principal balance of such Mortgage
Loans, so computed as of the related Cut-off Date. On each Closing Date, the
Purchaser shall deduct from the Purchase Price proceeds certain costs and
expenses set forth in Article XIII or in the related Purchase Price and Terms
Agreement.
In addition to the Purchase Price as described above, the Purchaser shall
pay to the Seller, on the related Closing Date, accrued interest on the
initial principal amount of the Mortgage Loans at the weighted average
Mortgage Interest Rate from the date interest was last received on the related
Mortgage Loan through the day prior to the related Closing Date, inclusive.
The Purchase Price shall be paid on the related Closing Date by wire
transfer of immediately available federal funds.
The Purchaser shall be entitled to (i) all principal received after the
related Cut-off Date, (ii) all other recoveries of late charges, assumption
fees or other charges collected after the related Cut-off Date, and (iii) all
payments of interest on the Mortgage Loans at the Mortgage Interest Rate. The
principal balance of each Mortgage Loan as of the related Cut-off Date is
-14-
determined after application of payments of principal received on or before
the related Cut-off Date. All payments of principal and interest (minus
interest at the Servicing Fee Rate) due on the first day of the month after
the related Cut-off Date shall belong to the Purchaser.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES;
REMEDIES AND BREACH
Section 4.01 Seller Representations and Warranties.
The Seller represents and warrants to the Purchaser that as of each
Closing Date:
(a) Due Organization and Authority. The Seller is a New York corporation
duly organized, validly existing and in good standing under the laws of the
State of New York and has all licenses necessary to carry on its business as
now being conducted and is licensed, qualified and in good standing in each
state where a Mortgaged Property is located if the laws of such state require
licensing or qualification in order to conduct business of the type conducted
by the Seller, and in any event the Seller is in compliance with the laws of
any such state to the extent necessary to ensure the enforceability of the
related Mortgage Loan and the servicing of such Mortgage Loan in accordance
with the terms of this Agreement; the Seller has the full corporate power and
authority to execute and deliver this Agreement and to perform in accordance
herewith; the execution, delivery and performance of this Agreement (including
all instruments of transfer to be delivered pursuant to this Agreement) by the
Seller and the consummation of the transactions contemplated hereby have been
duly and validly authorized; this Agreement evidences the valid, binding and
enforceable obligation of the Seller; and all requisite corporate action has
been taken by the Seller to make this Agreement valid and binding upon the
Seller in accordance with its terms;
(b) Ordinary Course of Business. The consummation of the transactions
contemplated by this Agreement are in the ordinary course of business of the
Seller, and the transfer, assignment and conveyance of the Mortgage Notes and
the Mortgages by the Seller pursuant to this Agreement are not subject to the
bulk transfer or any similar statutory provisions in effect in any applicable
jurisdiction;
(c) No Conflicts. Neither the execution and delivery of this Agreement,
the acquisition of the Mortgage Loans by the Seller, the sale of the Mortgage
Loans to the Purchaser or the transactions contemplated hereby, nor the
fulfillment of or compliance with the terms and conditions of this Agreement,
will conflict with or result in a breach of any of the terms, conditions or
provisions of the Seller's charter or by-laws or any legal restriction or any
agreement or instrument to which the Seller is now a party or by which it is
bound, or constitute a default or result in an acceleration under any of the
foregoing, or result in the violation of any law, rule, regulation, order,
judgment or decree to which the Seller or its property is subject, or impair
the ability of the Purchaser to realize on the Mortgage Loans, or impair the
value of the Mortgage Loans;
-15-
(d) Ability to Perform. The Seller does not believe, nor does it have any
reason or cause to believe, that it cannot perform each and every covenant
contained in this Agreement. The Seller is solvent and the sale of the
Mortgage Loans will not cause the Seller to become insolvent. The sale of the
Mortgage Loans is not undertaken with the intent to hinder, delay or defraud
any of the Seller's creditors.;
(e) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or threatened against the Seller which, either in any
one instance or in the aggregate, may result in any material adverse change in
the business, operations, financial condition, properties or assets of the
Seller, or in any material impairment of the right or ability of the Seller to
carry on its business substantially as now conducted, or in any material
liability on the part of the Seller, or which would draw into question the
validity of this Agreement or the Mortgage Loans or of any action taken or to
be taken in connection with the obligations of the Seller contemplated herein,
or which would be likely to impair materially the ability of the Seller to
perform under the terms of this Agreement;
(f) No Consent Required. No consent, approval, authorization or order of
any court or governmental agency or body is required for the execution,
delivery and performance by the Seller of or compliance by the Seller with
this Agreement or the Mortgage Loans, the delivery of a portion of the
Mortgage Files to the Custodian or the sale of the Mortgage Loans to the
Purchaser or the consummation of the transactions contemplated by this
Agreement, or if required, such approval has been obtained prior to the
related Closing Date;
(g) Selection Process. The Mortgage Loans were not intentionally selected
in a manner so as to affect adversely the interests of the Purchaser;
(h) No Untrue Information. Neither this Agreement nor any statement,
report or other document furnished or to be furnished pursuant to this
Agreement or in connection with the transactions contemplated hereby contains
any untrue statement of fact or omits to state a fact necessary to make the
statements contained therein not misleading;
(i) Sale Treatment. The Seller has determined that the disposition of the
Mortgage Loans pursuant to this Agreement will be afforded sale treatment for
accounting and tax purposes;
(j) No Commissions to Third Parties. The Seller has not dealt with any
broker or agent or anyone else who might be entitled to a fee or commission in
connection with this transaction other than the Purchaser;
(k) Financial Statements. The Seller has delivered to the Purchaser
financial statements as to its last three complete fiscal years and any later
quarter ended more than sixty (60) days prior to the execution of this
Agreement. All such financial statements fairly present the pertinent results
of operations and changes in financial position at the end of each such period
of the Seller and its subsidiaries and have been prepared in accordance with
generally accepted accounting principles consistently applied throughout the
periods involved, except as set forth in the notes thereto. There has been no
change in the business, operations, financial condition, properties or assets
of the Seller since the date of the Seller's financial statements that would
-16-
have a material adverse effect on its ability to perform its obligations under
this Agreement. The Seller has completed any forms requested by the Purchaser
in a timely manner and in accordance with the provided instructions;
(l) Fair Consideration. The consideration received by the Seller upon the
sale of the Mortgage Loans under this Agreement constitutes fair consideration
and reasonably equivalent value for the Mortgage Loans;
(m) MERS. The Seller 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 MERS Mortgage Loans for as long as such Mortgage
Loans are registered with MERS; and
(n) Ability to Service. The Seller is an approved servicer of conventional
residential mortgage loans for ▇▇▇▇▇▇ Mae and ▇▇▇▇▇▇▇ Mac, with the
facilities, procedures, and experienced personnel necessary for the sound
servicing of mortgage loans of the same type as the Mortgage Loans. The Seller
is in good standing to service mortgage loans for ▇▇▇▇▇▇ Mae and ▇▇▇▇▇▇▇ Mac,
and no event has occurred, including but not limited to a change in insurance
coverage, which would make the Seller unable to comply with ▇▇▇▇▇▇ Mae and
▇▇▇▇▇▇▇ Mac eligibility requirements or which would require notification to
▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, as applicable; and
(o) Reasonable Servicing Fee. The Seller acknowledges and agrees that the
Servicing Fee, as calculated at the Servicing Fee Rate, represents reasonable
compensation for performing such services and that the entire Servicing Fee
shall be treated by the Seller, for accounting and tax purposes, as
compensation for the servicing and administration of the Mortgage Loans
pursuant to this Agreement.
Section 4.02 Representations and Warranties Regarding Individual Mortgage
Loans.
As to each Mortgage Loan, the Seller hereby represents and warrants to the
Purchaser that as of the related Closing Date:
(a) Mortgage Loans as Described. The information set forth in the related
Mortgage Loan Schedule is complete, true and correct in all material respects;
(b) Payments Current. All payments required to be made up to the related
Closing Date on the Mortgage Loan under the terms of the Mortgage Note have
been made and credited. No payment required under the Mortgage Loan is
delinquent nor has any payment under the Mortgage Loan been delinquent for 30
days or more at any time for the twelve months preceding the Closing Date. The
first and second Monthly Payments have been made with respect to the Mortgage
Loan on its Due Date or within the grace period, all in accordance with the
terms of the related Mortgage Note;
(c) No Outstanding Charges. There are no defaults in complying with the
terms of the Mortgage, and all taxes, governmental assessments, insurance
premiums, water, sewer and municipal charges, leasehold payments or ground
rents which previously became due and owing
-17-
have been paid, or an escrow of funds has been established in an amount
sufficient to pay for every such item which remains unpaid and which has been
assessed but is not yet due and payable. The Seller has not advanced funds, or
induced, solicited or knowingly received any advance of funds by a party other
than the Mortgagor, directly or indirectly, for the payment of any amount
required under the Mortgage Loan, except for interest accruing from the date
of the Mortgage Note or date of disbursement of the Mortgage Loan proceeds,
whichever is earlier, to the day which precedes by one month the Due Date of
the first installment of principal and interest;
(d) Original Terms Unmodified. The terms of the Mortgage Note and Mortgage
have not been impaired, waived, altered or modified in any respect, except by
a written instrument which has been recorded, if necessary to protect the
interests of the Purchaser and which has been delivered to the Purchaser. The
substance of any such waiver, alteration or modification has been approved by
any title insurer, to the extent required by the policy, and its terms are
reflected on the related Mortgage Loan Schedule. No Mortgagor has been
released, in whole or in part, except in connection with an assumption
agreement approved by any related title insurer, to the extent required by the
policy, and which assumption agreement is part of the Mortgage Loan File
delivered to the Purchaser and the terms of which are reflected in the related
Mortgage Loan Schedule;
(e) No Defenses. The Mortgage Loan is not subject to any right of
rescission, set-off, counterclaim or defense, including without limitation the
defense of usury, nor will the operation of any of the terms of the Mortgage
Note or the Mortgage, or the exercise of any right thereunder, render either
the Mortgage Note or the Mortgage unenforceable, in whole or in part, or
subject to any right of rescission, set-off, counterclaim or defense,
including without limitation the defense of usury, and no such right of
rescission, set-off, counterclaim or defense has been asserted with respect
thereto, and no Mortgagor was a debtor in any state or federal bankruptcy or
insolvency proceeding within the 24 months preceding the origination of the
Mortgage Loan;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all buildings
or other improvements upon the Mortgaged Property are insured by a generally
acceptable insurer against loss by fire, hazards of extended coverage and such
other hazards as are customary in the area where the Mortgaged Property is
located pursuant to insurance policies conforming to the requirements of
▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇ Mac. If upon origination of the Mortgage Loan, the
Mortgaged Property was in an area identified in the Federal Register by the
Federal Emergency Management Agency as having special flood hazards a life-of-
loan flood insurance policy meeting the requirements of the current guidelines
of the Federal Flood Insurance Administration is in effect which policy
conforms to the requirements of ▇▇▇▇▇▇ Mae and ▇▇▇▇▇▇▇ Mac. Such flood
insurance shall be with an Approved Flood Policy Insurer. All individual
insurance policies contain a standard mortgagee clause naming the Seller and
its successors and assigns as mortgagee, and all premiums thereon have been
paid. The Mortgage obligates the Mortgagor thereunder to maintain the hazard
insurance policy at the Mortgagor's cost and expense, and on the Mortgagor's
failure to do so, authorizes the holder of the Mortgage to obtain and maintain
such insurance at such Mortgagor's cost and expense, and to seek reimbursement
therefor from the Mortgagor. Where required by state law or regulation, the
Mortgagor has been given an opportunity to choose the carrier of the required
hazard insurance, provided the policy is not a "master" or "blanket" hazard
insurance policy covering the common facilities of a planned unit
-18-
development. The hazard insurance policy is the valid and binding obligation
of the insurer, is in full force and effect, and will be in full force and
effect and inure to the benefit of the Purchaser upon the consummation of the
transactions contemplated by this Agreement. The Seller has not engaged in,
and has no knowledge of the Mortgagor's or any subservicer's having engaged
in, any act or omission which would impair the coverage of any such policy,
the benefits of the endorsement provided for herein, or the validity and
binding effect of either, including, without limitation, no unlawful fee,
commission, kickback or other unlawful compensation or value of any kind has
been or will be received, retained or realized by any attorney, firm or other
person or entity, and no such unlawful items have been received, retained or
realized by the Seller;
(g) Compliance with Applicable Laws. Any and all requirements of any
federal, state or local law including, without limitation, usury, truth-in-
lending, real estate settlement procedures, consumer credit protection, equal
credit opportunity or disclosure laws applicable to the Mortgage Loan have
been complied with, and the Seller shall maintain in its possession, available
for the Purchaser's inspection, and shall deliver to the Purchaser on the
related Closing Date, evidence of compliance with all such requirements;
(h) No Satisfaction of Mortgage. The Mortgage has not been satisfied,
canceled, subordinated or rescinded, in whole or in part, and the Mortgaged
Property has not been released from the lien of the Mortgage, in whole or in
part, nor has any instrument been executed that would effect any such release,
cancellation, subordination or rescission. The Seller has not waived the
performance by the Mortgagor of any action, if the Mortgagor's failure to
perform such action would cause the Mortgage Loan to be in default, nor has
the Seller waived any default resulting from any action or inaction by the
Mortgagor;
(i) Location and Type of Mortgaged Property. The Mortgaged Property is a
fee simple property located in the state identified in the related Mortgage
Loan Schedule and consists of a single parcel of real property with a detached
single family residence erected thereon, a two- to four-family dwelling, an
individual condominium unit in a low-rise condominium project, an individual
unit in a planned unit development or a manufactured dwelling permanently
affixed to the ground, provided, however, that any condominium unit or planned
unit development shall conform with the applicable Underwriting Guidelines
regarding such dwellings and that no residence or dwelling is a mobile home.
No portion of the Mortgaged Property is used for commercial purposes;
(j) Valid First or Second Lien. With respect to any first lien Mortgage
Loan, the related Mortgage is a valid, subsisting, enforceable and perfected
first lien on the Mortgaged Property and, with respect to any Second Lien
Mortgage Loan, the related Mortgage is a valid, subsisting, enforceable and
perfected Second Lien on the Mortgaged Property, including all buildings on
the Mortgaged Property and all installations and mechanical, electrical,
plumbing, heating and air conditioning systems located in or annexed to such
buildings, and all additions, alterations and replacements made at any time
with respect to the foregoing. Such lien is free and clear of all adverse
claims, liens and encumbrances having priority over the First Lien or second
lien, as applicable, of the Mortgage subject only to:
(i) with respect to any Second Lien Mortgage Loan, the related First Lien,
-19-
(ii) the lien of current real property taxes and assessments not yet due
and payable,
(iii) covenants, conditions and restrictions, rights of way, easements and
other matters of the public record as of the date of recording acceptable to
mortgage lending institutions generally and specifically referred to in the
lender's title insurance policy delivered to the originator of the Mortgage
Loan and (A) referred to or to otherwise considered in the appraisal made for
the originator of the Mortgage Loan or (B) which do not adversely affect the
appraised value of the Mortgaged Property set forth in such appraisal; and
(iv) other matters to which like properties are commonly subject which do
not materially interfere with the benefits of the security intended to be
provided by the Mortgage or the use, enjoyment, value or marketability of the
related Mortgaged Property.
(k) Any security agreement, chattel mortgage or equivalent document
related to and delivered in connection with the Mortgage Loan establishes and
creates a valid, subsisting and enforceable first lien and first priority
security interest on the property described therein and the Seller has full
right to sell and assign the same to the Purchaser. The Mortgaged Property was
not, as of the date of origination of the Mortgage Loan, subject to a
mortgage, deed of trust, deed to secure debt or other security instrument
creating a lien subordinate to the lien of the Mortgage;
(l) Validity of Mortgage Documents. The Mortgage Note and the Mortgage are
genuine, and each is the legal, valid and binding obligation of the maker
thereof enforceable in accordance with its terms. All parties to the Mortgage
Note and the Mortgage and any other related agreement had legal capacity to
enter into the Mortgage Loan and to execute and deliver the Mortgage Note and
the Mortgage and any other related agreement, and the Mortgage Note and the
Mortgage and any other related agreement have been duly and properly executed
by such parties. The documents, instruments and agreements submitted for loan
underwriting were not falsified and contain no untrue statement of material
fact or omit to state a material fact required to be stated therein or
necessary to make the information and statements therein not misleading. No
fraud was committed in connection with the origination of the Mortgage Loan.
The Seller has reviewed all of the documents constituting the Servicing File
and has made such inquiries as it deems necessary to make and confirm the
accuracy of the representations set forth herein;
(m) LTV, PMI Policy. No Mortgage Loan has a LTV equal to or greater than
as is set forth in the related Purchase Price and Terms Agreement. The
original LTV of the Mortgage Loan either was not more than 80% or the excess
over 75% is and will be insured as to payment defaults by a PMI Policy until
the LTV of such Mortgage Loan is reduced to 80%. All provisions of such PMI
Policy have been and are being complied with, such policy is in full force and
effect, and all premiums due thereunder have been paid. No action, inaction,
or event has occurred and no state of facts exists that has, or will result in
the exclusion from, denial of, or defense to coverage. Any Mortgage Loan
subject to a PMI Policy obligates the Mortgagor thereunder to maintain the PMI
Policy and to pay all premiums and charges in connection therewith. The
Mortgage Interest Rate for the Mortgage Loan as set forth on the related
Mortgage Loan Schedule is net of any such insurance premium;
-20-
(n) Full Disbursement of Proceeds. The Mortgage Loan has been closed and
the proceeds of the Mortgage Loan have been fully disbursed and there is no
requirement for future advances thereunder, and any and all requirements as to
completion of any on-site or off-site improvement and as to disbursements of
any escrow funds therefor have been complied with. All costs, fees and
expenses incurred in making or closing the Mortgage Loan and the recording of
the Mortgage were paid, and the Mortgagor is not entitled to any refund of any
amounts paid or due under the Mortgage Note or Mortgage;
(o) Ownership. The Seller is the sole owner of record and holder of the
Mortgage Loan. The Mortgage Loan is not assigned or pledged, and the Seller
has good and marketable title thereto, and has full right to transfer and sell
the Mortgage Loan therein to the Purchaser free and clear of any encumbrance,
equity, participation interest, lien, pledge, charge, claim or security
interest, and has full right and authority subject to no interest or
participation of, or agreement with, any other party, to sell and assign each
Mortgage Loan pursuant to this Agreement;
(p) Doing Business. All parties which have had any interest in the
Mortgage Loan, whether as mortgagee, assignee, pledgee or otherwise, are (or,
during the period in which they held and disposed of such interest, were) (1)
in compliance with any and all applicable licensing requirements of the laws
of the state wherein the Mortgaged Property is located, and (2) organized
under the laws of such state, or (3) qualified to do business in such state,
or (4) federal savings and loan associations or national banks having
principal offices in such state, or (5) not doing business in such state;
(q) Loan-to-Value Ratio. No Mortgage Loan has an LTV of greater than as
set forth in the related Purchase Price and Terms Agreement. No Second Lien
Mortgage Loan has a CLTV of greater than 100%;
(r) Title Insurance. The Mortgage Loan is covered by an ALTA lender's
title insurance policy or other generally acceptable form of policy of
insurance acceptable to ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac, issued by a title insurer
acceptable to ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac and qualified to do business in the
jurisdiction where the Mortgaged Property is located, insuring the Seller, its
successors and assigns, as to the First Lien of the Mortgage in the original
principal amount of the Mortgage Loan subject only to the exceptions contained
in clauses (i), (ii), (iii) and (iv) of paragraph (j) of this Section 4.02.
Where required by state law or regulation, the Mortgagor has been given the
opportunity to choose the carrier of the required mortgage title insurance.
Additionally, such lender's title insurance policy affirmatively insures
ingress and egress, and against encroachments by or upon the Mortgaged
Property or any interest therein. The Seller is the sole insured of such
lender's title insurance policy, and such lender's title insurance policy is
in full force and effect and will be in force and effect upon the consummation
of the transactions contemplated by this Agreement. No claims have been made
under such lender's title insurance policy, and no prior holder of the
Mortgage, including the Seller, has done, by act or omission, anything which
would impair the coverage of such lender's title insurance policy including
without limitation, no unlawful fee, commission, kickback or other unlawful
compensation or value of any kind has been or will be received, retained or
realized by any attorney, firm or other person or entity, and no such unlawful
items have been received, retained or realized by the Seller;
-21-
(s) No Defaults. There is no default, breach, violation or event of
acceleration existing under the Mortgage or the Mortgage Note or related
documents and no event which, with the passage of time or with notice and the
expiration of any applicable grace or cure period, would constitute a default,
breach, violation or event of acceleration, and neither the Seller nor any of
its predecessors have waived any default, breach, violation or event of
acceleration. With respect to each Second Lien Mortgage Loan, (i) the First
Lien is in full force and effect, (ii) there is no default, breach, violation
or event of acceleration existing under such prior mortgage or the related
mortgage note, (iii) no event which, with the passage of time or with notice
and the expiration of any grace or cure period, would constitute a default,
breach, violation or event of acceleration thereunder, and either (A) the
prior mortgage contains a provision which allows or (B) applicable law
requires, the mortgagee under the Second Lien Mortgage Loan to receive notice
of, and affords such mortgagee an opportunity to cure any default by payment
in full or otherwise under the prior mortgage;
(t) No Mechanics' Liens. There are no mechanics' or similar liens or
claims which have been filed for work, labor or material (and no rights are
outstanding that under the law could give rise to such liens) affecting the
related Mortgaged Property which are or may be liens prior to, or equal or
coordinate with, the lien of the related Mortgage;
(u) Location of Improvements; No Encroachments. All improvements which
were considered in determining the Appraised Value of the Mortgaged Property
lay wholly within the boundaries and building restriction lines of the
Mortgaged Property, no improvements on adjoining properties to which value was
assigned encroach upon the Mortgaged Property; further, the value of the
Mortgaged Property is not diminished by any improvements on adjoining
properties which encroach the Mortgaged Property. No improvement located on or
being part of the Mortgaged Property (upon which value was given in
determining the Appraised Value) is in violation of any applicable zoning law
or regulation; provided, that in no event shall a legal nonconforming use of
the Mortgaged Property be considered a violation of any such zoning law or
regulation.
(v) Origination; Payment Terms. Principal payments on the Mortgage Loan
commenced no more than sixty (60) days after the funds were disbursed in
connection with the Mortgage Loan. At the time the Mortgage Loan was
originated, the originator was a mortgagee approved by the Secretary of
Housing and Urban Development pursuant to Sections 203 and 211 of the National
Housing Act or a savings and loan association, a savings bank, a commercial
bank or similar banking institution which is supervised and examined by a
Federal or State authority. The Mortgage Interest Rate is (i) with respect to
fixed rate Mortgage Loans, the fixed interest rate set forth in the Mortgage
Note and (ii) with respect to ARM Mortgage Loans, adjusted on each Interest
Rate Adjustment Date pursuant to the Mortgage Loan Documents and rounded as
required under Accepted Servicing Practices and subject to the Mortgage
Interest Rate Cap, the Periodic Rate Cap and the Lifetime Rate Cap. Except
with respect to any balloon Mortgage Loan as indicated on the related Mortgage
Loan Schedule, the Mortgage Note is payable in equal monthly installments of
principal and interest, with interest calculated and payable in arrears,
sufficient to amortize the Mortgage Loan fully by the stated maturity date,
over an original term of not more than thirty years from commencement of
amortization. The Mortgage Interest Rate, as well as the Lifetime Rate Cap,
the Periodic Rate Cap and the Mortgage Interest Rate Cap, are as set forth on
the Mortgage Loan Schedule. No ARM
-22-
Mortgage Loan contains terms whereby the Mortgagor is permitted to convert the
Mortgage Loan to a fixed rate Mortgage Loan, no ARM Mortgage Loan contains a
negative amortization provision and no ARM Mortgage Loan contains a rounding
feature. All of the ARM Mortgage Loans contain an interest rate provision that
requires a lookback of 45 days. With respect to each Mortgage Loan Package,
the Mortgage Loan Schedule does not contain more than one Mortgage Loan with
the same Mortgagor;
(w) Customary Provisions. The Mortgage contains customary and enforceable
provisions such as to render the rights and remedies of the holder thereof
adequate for the realization against the Mortgaged Property of the benefits of
the security provided thereby, including, (i) in the case of a Mortgage
designated as a deed of trust, by trustee's sale, and (ii) otherwise by
judicial or nonjudicial foreclosure. Upon default by an Mortgagor on a
Mortgage Loan and foreclosure on, or trustee's sale of, the Mortgaged Property
pursuant to the proper procedures, the holder of the Mortgage Loan will be
able to deliver good and merchantable title to the Mortgaged Property. There
is no homestead or other exemption available to the Mortgagor which would
interfere with the right to sell the Mortgaged Property at a trustee's sale or
the right to foreclose the Mortgage subject to applicable federal and state
laws and judicial precedent with respect to bankruptcy and right of
redemption;
(x) Conformance with Underwriting Guidelines. Each Mortgage Loan fully
conforms to all underwriting guidelines and other requirements of ▇▇▇▇▇▇ ▇▇▇
and ▇▇▇▇▇▇▇ Mac other than with respect to the original principal amount. The
Mortgage Loan was underwritten in accordance with the Underwriting Guidelines
in effect at the time the Mortgage Loan was originated. The Mortgage Note and
Mortgage are on forms acceptable to participants in the secondary mortgage
market for similar types of Mortgage Loans;
(y) Occupancy of the Mortgaged Property. As of the related Closing Date
the Mortgaged Property will be lawfully occupied under applicable law. All
inspections, licenses and certificates required to be made or issued with
respect to all occupied portions of the Mortgaged Property and with respect to
the use and occupancy of the same, including, but not limited to, certificates
of occupancy and fire underwriting certificates, have been made or obtained
from the appropriate authorities;
(z) No Additional Collateral. The Mortgage Note is not and has not been
secured by any collateral except the lien of the corresponding Mortgage and
the security interest of any applicable security agreement or chattel mortgage
referred to in the "Valid Lien" representation above.
(aa) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and duly qualified under applicable law to serve
as such, has been properly designated and currently so serves and is named in
the Mortgage, and no fees or expenses are or will become payable by Purchaser
to the trustee under the deed of trust, except in connection with a trustee's
sale after default by the Mortgagor.
(bb) Acceptable Investment. The Seller has no knowledge of any
circumstances or conditions with respect to the Mortgage, the Mortgaged
Property, the Mortgagor or the Mortgagor's credit standing that can reasonably
be expected to cause private institutional
-23-
investors to regard the Mortgage Loan as an unacceptable investment, cause the
Mortgage Loan to become delinquent, or adversely affect the value or
marketability of the Mortgage Loan;
(cc) Delivery of Mortgage Documents. The Mortgage Note, the Mortgage, the
Assignment of Mortgage and any other documents required to be delivered by the
Seller under this Agreement have been delivered to the Purchaser or its
designee. The Seller is in possession of a complete, true and accurate
Mortgage File in compliance with Exhibit B hereto, except for such documents
the originals of which have been delivered to the Purchaser or its designee;
(dd) Condominiums/Planned Unit Developments/Manufactured Dwellings. If the
Mortgaged Property is a condominium unit or a planned unit development (other
than a de minimus planned unit development) such condominium or planned unit
development project meets the related Underwriting Guidelines. With respect to
each Mortgage Loan secured by a manufactured home: (i) the manufactured home
is permanently affixed to a foundation which is suitable for the soil
conditions of the site; (ii) all foundations, both perimeter and interior,
have footings that are located below the frost line; (iii) any wheels, axles
and trailer hitches are removed from the manufactured home; (iv) the Mortgage
Loan is covered under a standard real estate title insurance policy or
attorney's title opinion or certificate that identified the manufactured home
as part of the real property and insures or indemnifies against any loss if
the manufactured home is determined not to be part of the real property. In no
event shall any Mortgage Loan be secured by a mobile home;
(ee) Due on Sale. Each Mortgage, together with any such documents as may
be required under applicable law, contains an enforceable provision for the
acceleration of the payment of the unpaid principal balance of the Mortgage
Loan in the event that the Mortgaged Property is sold or transferred without
the prior written consent of the mortgagee thereunder, at the option of the
mortgagee;
(ff) Transfer of Mortgage Loans. If the Mortgage Loan is not a MERS
Mortgage Loan, each of the Mortgage and the Assignment of Mortgage (upon the
insertion of the assignee's name) is in recordable form and is acceptable for
recording under the laws of the jurisdiction in which the Mortgaged Property
is located, and each Mortgage has been delivered to the appropriate recorder's
office for recording;
(gg) No Buydown Provisions; No Graduated Payments or Contingent Interests.
The Mortgage Loan does not contain provisions pursuant to which Monthly
Payments are paid or partially paid with funds deposited in any separate
account established by the Seller, the Mortgagor or anyone on behalf of the
Mortgagor, or paid by any source other than the Mortgagor, nor does it contain
any other similar provisions currently in effect which may constitute a
"buydown" provision. The Mortgage Loan is not a graduated payment mortgage
loan and the Mortgage Loan does not have a shared appreciation or other
contingent interest feature;
(hh) Consolidation of Future Advances. Any future advances made to the
Mortgagor prior to the related Cut-off Date have been consolidated with the
outstanding principal amount secured by the Mortgage, and the secured
principal amount, as consolidated, bears a single interest readjustment
feature or rate and single repayment term. The lien of the
-24-
Mortgage securing the consolidated principal amount is expressly insured as
having the lien priority as indicated on the Mortgage Loan Schedule by a title
insurance policy, an endorsement to the policy insuring the mortgagee's
consolidated interest or by other title evidence acceptable to Purchaser,
▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac. The consolidated principal amount does not exceed
the original principal amount of the Mortgage Loan;
(ii) Mortgaged Property Undamaged; No Condemnation Proceedings. There is
no proceeding pending or threatened for the total or partial condemnation of
the Mortgaged Property. The Mortgaged Property is undamaged by waste, fire,
earthquake or earth movement, windstorm, flood, tornado or other casualty so
as to affect adversely the value of the Mortgaged Property as security for the
Mortgage Loan or the use for which the premises were intended;
(jj) Collection Practices; Escrow Payments. The origination and collection
practices used with respect to the Mortgage Loan have been in accordance with
Accepted Servicing Practices, in all respects in compliance with all
applicable laws and regulations and in all material respects proper and
prudent in the mortgage origination and servicing business. With respect to
escrow deposits and Escrow Payments, all such payments are in the possession
of the Seller and there exist no deficiencies in connection therewith for
which customary arrangements for repayment thereof have not been made. All
Escrow Payments have been collected in full compliance with state and federal
law. An escrow of funds is not prohibited by applicable law and has been
established in an amount sufficient to pay for every item which remains unpaid
and which has been assessed but is not yet due and payable. No escrow deposits
or Escrow Payments or other charges or payments due the Seller have been
capitalized under the Mortgage or the Mortgage Note. With respect to each ARM
Mortgage Loan, all Mortgage Interest Rate adjustments have been made in strict
compliance with federal law and the terms of the Mortgage Note. The index used
for the adjustment of the Mortgage Interest Rate on each ARM Mortgage Loan is
the Index;
(kk) Insurance. The Seller has caused or will cause to be performed any
and all acts required to preserve the rights and remedies of the Purchaser in
any insurance policies applicable to the Mortgage Loans including, without
limitation, any necessary notifications of insurers, assignments of policies
or interests therein, and establishments of coinsured, joint loss payee and
mortgagee rights in favor of the Purchaser; No action, inaction, or event has
occurred and no state of fact exists or has existed that has resulted or will
result in the exclusion from, denial of, or defense to coverage under any
applicable pool insurance policy, special hazard insurance policy, PMI Policy
or bankruptcy bond, irrespective of the cause of such failure of coverage. In
connection with the placement of any such insurance, no commission, fee, or
other compensation has been or will be received by the Seller or any designee
of the Seller or any corporation in which the Seller or any officer, director,
or employee had a financial interest at the time of placement of such
insurance;
(ll) Appraisal. The Mortgage File contains an appraisal of the related
Mortgage Property signed prior to the approval of the Mortgage Loan
application by a Qualified Appraiser;
(mm) Soldiers' and Sailors' Relief Act. The Mortgagor has not notified the
Seller, and the Seller has no knowledge of any relief requested or allowed to
the Mortgagor under the Soldiers' and Sailors' Civil Relief Act of 1940;
-25-
(nn) Environmental Matters. The Mortgaged Property is free from any and
all toxic or hazardous substances and there exists no violation of any local,
state or federal environmental law, rule or regulation. There is no pending
action or proceeding directly involving any Mortgaged Property of which the
Seller is aware in which compliance with any environmental law, rule or
regulation is an issue; and to the best of the Seller's knowledge, nothing
further remains to be done to satisfy in full all requirements of each such
law, rule or regulation consisting a prerequisite to use and enjoyment of said
property;
(oo) Mortgagor Acknowledgment. The Mortgagor has executed a statement to
the effect that the Mortgagor has received all disclosure materials required
by applicable law with respect to the making of ARM Mortgage Loans. Seller
shall maintain or cause to be maintained such statement in the Mortgage File;
(pp) No Construction Mortgage Loans. The Mortgage Loan was not made in
connection with (i) the construction or rehabilitation of a Mortgaged Property
or (ii) facilitating the trade-in or exchange of a Mortgaged Property.
(qq) Selection. The Mortgage Loans were not intentionally selected for
inclusion under this Agreement from among Seller's mortgage loan portfolio on
any basis which would have an adverse effect on the interests of Purchaser.
(rr) Regarding the Mortgagor. The Mortgagor is one or more natural
persons;
(ss) Circumstances Affecting Value, Marketability or Prepayment. No
circumstances or conditions exist with respect to the Mortgage, the Mortgaged
Property, or the Mortgagor's credit standing that could reasonably be expected
to adversely affect the value or the marketability of any Mortgaged Property
or Mortgage Loan, other than the economic and geological conditions generally
and specifically applicable to the area in which the Mortgaged Property is
located, or cause the Mortgage Loan to become delinquent.
(tt) Predatory Lending Regulations; High Cost Loans. None of the Mortgage
Loans are classified as (i) "high cost" loans under the Home Ownership and
Equity Protection Act of 1994 or (ii) "high cost," "threshold," "covered" or
"predatory" loans under any other applicable state, federal or local law. Each
loan at the time it was made complied in all material respects with applicable
local, state, and federal laws, including, but not limited to, all applicable
predatory and abusive lending laws;
(uu) Georgia Mortgage Loans. No Mortgage Loan originated between October
1, 2002 and March 7, 2003 (both inclusive) and secured by a Mortgaged Property
located in the State of Georgia is a "home loan" and is either a "covered" or
"high cost loan" as defined in the Georgia Fair Lending Act, as amended. No
Mortgage Loan originated after March 7, 2003 and secured by a Mortgaged
Property located in the State of Georgia is a "home loan" and is a "high cost
loan" as defined in the Georgia Fair Lending Act, as amended;
(vv) REMIC Status. The Mortgage Loan is a qualified mortgage for inclusion
in a "real estate mortgage investment conduit" for federal income tax
purposes;
-26-
(ww) Tax Service Contract. The Seller has obtained a life of loan,
transferable real estate tax service contract with an Approved Tax Service
Contract Provider on each Mortgage Loan and such contract is assignable
without penalty, premium or cost to the Purchaser; upon the initial set-up,
each such tax service contract shall contain complete and accurate information
with respect to the Mortgage Loan and Mortgaged Property;
(xx) Flood Certification Contract. The Seller has obtained a life of loan,
transferable flood certification contract with an Approved Flood Policy
Insurer for each Mortgage Loan and such contract is assignable without
penalty, premium or cost to the Purchaser;
(yy) Genuineness of Signatures. Each of the documents in the Mortgage File
is genuine and contains genuine signatures. Each document that Purchaser
requires to be an original document is an original document. All certified
copies of original documents are true copies and meet the applicable
requirements and specifications of this Agreement and any other written
requirements that Purchaser has reasonably made of Seller;
(zz) No Prior Rejection. No Mortgage Loan has been previously submitted
for purchase by the Seller to the Purchaser and reviewed and rejected by the
Purchaser for underwriting reasons;
(aaa) No Cooperative Shares. No Mortgage Loan is secured by shares in a
cooperative corporation;
(bbb) Qualified Mortgage Loan. Each Mortgage Loan constitutes a qualified
mortgage loan under Section 860(g)(a)(3)(A) of the Code and Treasury
Regulations Section 1.860G-2(a)(1) and (3);
(ccc) Low Income Borrowers. Seller represents and warrants that the Seller
currently operates and actively participates in an on-going business (A) to
originate single family mortgage loans ("Loans") and/or (B) to make periodic
purchases of Loans from originators or sellers, and/or (C) to issue and/or
purchase securities or bonds supported by the Loans, a portion of which Loans
are made to borrowers who are:
(i) low income families (families with incomes 80% or less of area median
income) living in low-income areas (a census tract or block numbering area in
which the median income does not exceed 80% of the area median income); or
(ii) very low income families (families with incomes of 60% or less of
area median income);
(ddd) Recordation. Each original Mortgage was recorded and, except for
those Mortgage Loans subject to MERS, all subsequent assignments of the
original Mortgage (other than the assignment to the Purchaser) have been
recorded in the appropriate jurisdictions wherein such recordation is
necessary to perfect the lien thereof as against creditors of the Seller, or
is in the process of recordation;
-27-
(eee) Convertability. No Mortgage Loan contains a provision whereby the
Mortgagor can convert the mortgage loan to a fixed rate instrument;
(fff) Accuracy of Statements. The information contained in the Mortgage
Loan Schedule and all information provided regarding delinquencies in the
Mortgage Loans are true and correct in all material respects;
(ggg) Pool Characteristics. The pool characteristics with respect to the
Mortgage Loans included in the related Mortgage Loan Package are set forth in
the related Acknowledgment and Conveyance Agreement and are true and complete
in all material respects as of the related Closing Date;
(hhh) Origination Practices. No error, omission, misrepresentation,
negligence, fraud or similar occurrence with respect to a Mortgage Loan has
taken place on the part of any person including without limitation the Seller,
the Mortgagor, any appraiser, any builder or developer, or any other party
involved in the origination of the Mortgage Loan or, in the application of any
insurance in relation to such Mortgage Loan; no predatory or deceptive lending
practices or deceptive trade practices, including, without limitation, the
extension of credit without regard to the ability of the borrower to repay and
the extension of credit which has no apparent benefit to the borrower, were
employed in the origination of the Mortgage Loan. No Mortgagor was a debtor in
any state or federal bankruptcy or insolvency proceeding at any time within
twenty-four months prior to the origination of the Mortgage Loan, nor has any
Mortgagor had a foreclosure proceeding commenced against such Mortgagor within
twenty-four months prior to origination of the Mortgage Loan;
(iii) Compliance with Anti-Money Laundering Laws. The Seller has complied
with all applicable anti-money laundering laws and regulations, including
without limitation the USA Patriot Act of 2001 (collectively, the "Anti-Money
Laundering Laws"); the Seller has established an anti-money laundering
compliance program as required by the Anti-Money Laundering Laws, has
conducted the requisite due diligence in connection with the origination of
each Mortgage Loan for purposes of the Anti-Money Laundering Laws, including
with respect to the legitimacy of the applicable Mortgagor and the origin of
the assets used by the said Mortgagor to purchase the property in question,
and maintains, and will maintain, sufficient information to identify the
applicable Mortgagor for purposes of the Anti-Money Laundering Laws;
(jjj) Simple Interest Mortgage Loans. None of the Mortgage Loans are
simple interest Mortgage Loans;
(kkk) Single Premium Credit Life Insurance. None of the proceeds of the
Mortgage Loan were used to finance single-premium credit life insurance
policies;
(lll) Credit Reporting. The Seller has fully furnished in accordance with
the Fair Credit Reporting Act and its implementing regulations, accurate and
complete information on the Mortgagor credit files to Equifax, Experian and
Trans Union Credit Information Company on a monthly basis;
-28-
(mmm) FICO Scores. The FICO score of each Mortgage Loan is not less than
what is set forth on the related Mortgage Loan Schedule;
(nnn) Prepayment Fee. With respect to each Mortgage Loan that has a
prepayment fee feature, each such prepayment fee is enforceable and will be
enforced by the Seller through the related Closing Date, and each prepayment
fee is permitted pursuant to federal, state and local law and does not exceed
the maximum amount permitted under applicable law. With respect to each
Mortgage Loan that contains a prepayment fee, such prepayment fee is set forth
on the related Mortgage Loan Schedule;
(ooo) Lost Instrument Affidavits. In the event any Mortgage File contains
a lost note affidavit in lieu of a Mortgage Note, such lost note affidavit,
when assigned, will be sufficient to effect the transfer of title to the
related Mortgage Loan, without the need for a judicial proceeding,
administrative action, court or regulatory order, or similar action or order;
and
(ppp) Second Lien Mortgage Loans.
(i) Either (A) no consent for the Second Lien Mortgage Loan is required by
the holder of the related first lien or (B) such consent has been obtained and
is contained in the Mortgage File;
(ii) With respect to any Second Lien Mortgage Loan, the Seller has not
received notice of: (A) any proceeding for the total or partial condemnation
of any Mortgaged Property, (B) any subsequent, intervening mortgage, lien,
attachment, lis pendens or other encumbrance affecting any Mortgaged Property
or (C) any default under any mortgage, lien or other encumbrance senior to
each Mortgage;
(iii) With respect to any Second Lien Mortgage Loan, where required or
customary in the jurisdiction in which the Mortgaged Property is located, the
original lender has filed of record a request for notice of any action by the
senior lienholder under the related First Lien, and the original lender has
notified any senior lienholder in writing of the existence of the Second Lien
Mortgage Loan and requested notification of any action to be taken against the
Mortgagor by the senior lienholder;
(iv) No Second Lien Mortgage Loan is a "home equity line of credit" or
Texas Home Equity Loan; and
(v) As of the related Closing Date, the Seller has not received a notice
of default of a First Lien which has not been cured.
Section 4.03 Remedies for Breach of Representations and Warranties.
It is understood and agreed that the representations and warranties set
forth in Sections 4.01 and 4.02 shall survive the sale of the Mortgage Loans
to the Purchaser and the delivery of the Mortgage Loan Documents to the
Custodian and shall inure to the benefit of the Purchaser or the Seller, as
the case may be, notwithstanding any restrictive or qualified endorsement on
any Mortgage Note or Assignment of Mortgage or the examination or failure to
-29-
examine any Mortgage File. Upon discovery by the Seller or the Purchaser of a
breach of any of the foregoing representations and warranties which materially
and adversely affects the value of the Mortgage Loans or the interest of the
Purchaser, or which materially and adversely affects the interests of
Purchaser in the related Mortgage Loan in the case of a representation and
warranty relating to a particular Mortgage Loan (in the case of any of the
foregoing, a "Breach"), the party discovering such Breach shall give prompt
written notice to the others.
With respect to those representations and warranties which are made to the
best of the Seller's knowledge, if it is discovered by the Seller or the
Purchaser that the substance of such representation and warranty is inaccurate
and such inaccuracy materially and adversely affects the value of the related
Mortgage Loan or the interest of the Purchaser (or which materially and
adversely affects the value of a Mortgage Loan or the interests of the
Purchaser in the related Mortgage Loan in the case of a representation and
warranty relating to a particular Mortgage Loan), notwithstanding the Seller's
lack of knowledge with respect to the substance of such representation and
warranty, such inaccuracy shall be deemed a breach of the applicable
representation and warranty.
Upon discovery by either party of a Breach of any representation or
warranty, the party discovering such Breach shall give prompt written notice
to the other party. Within 60 days of the earlier of either discovery by or
notice to the Seller of any Breach of a representation or warranty, the Seller
shall use its best efforts promptly to cure such Breach in all material
respects and, if such Breach cannot be cured, the Seller shall, at the
Purchaser's option, repurchase such Mortgage Loan at the Repurchase Price. In
the event that a Breach shall involve any representation or warranty set forth
in Section 4.02, and such Breach cannot be cured within 60 days of the earlier
of either discovery by or notice to the Seller of such Breach, all of the
Mortgage Loans shall, at the Purchaser's option, be repurchased by the Seller
at the Repurchase Price.
Any repurchase of a Mortgage Loan or Loans pursuant to the foregoing
provisions of this Section 4.03 shall be accomplished by deposit in the
Custodial Account of the amount of the Repurchase Price for distribution to
Purchaser on the next scheduled Remittance Date, after deducting therefrom any
amount received in respect of such repurchased Mortgage Loan or Loans and
being held in the Custodial Account for future distribution.
At the time of repurchase, the Purchaser and the Seller shall arrange for
the reassignment of the Deleted Mortgage Loan to the Seller and the delivery
to the Seller of any documents held by the Custodian relating to the Deleted
Mortgage Loan. In the event of a repurchase, the Seller shall, simultaneously
with such reassignment, give written notice to the Purchaser and any servicer
of the Mortgage Loans that such repurchase has taken place, and the Mortgage
Loan Schedule shall be deemed amended to reflect the withdrawal of the Deleted
Mortgage Loan from this Agreement. For the month of repurchase, distributions
to Purchaser shall include the Monthly Payment due on any Deleted Mortgage
Loan in the month of repurchase, and the Seller shall thereafter be entitled
to retain all amounts subsequently received by the Seller in respect of such
Deleted Mortgage Loan.
In addition to such repurchase obligation, the Seller shall indemnify the
Purchaser and hold it harmless against any losses, damages, penalties, fines,
forfeitures, including without
-30-
limitation, reasonable and necessary legal fees and related costs, judgments,
and other costs and expenses resulting from any claim, demand, defense or
assertion based on or grounded upon, or resulting from, a Breach of the Seller
representations and warranties contained in this Agreement. It is understood
and agreed that the obligations of the Seller set forth in this Section 4.03
to cure or repurchase a defective Mortgage Loan and to indemnify the Purchaser
as provided in this Section 4.03 constitute the sole remedies of the Purchaser
respecting a Breach of the foregoing representations and warranties.
Any cause of action against the Seller relating to or arising out of the
Breach of any representations and warranties made in Sections 4.01 and 4.02
shall accrue as to any Mortgage Loan upon (i) discovery of such Breach by the
Purchaser or notice thereof by the Seller to the Purchaser, (ii) failure by
the Seller to cure such Breach within the applicable cure period or repurchase
such Mortgage Loan as specified above, and (iii) demand upon the Seller by the
Purchaser for compliance with this Agreement.
With respect to any Mortgage Loan, if the related Mortgagor is 30 or more
days delinquent with respect to the Mortgage Loan's first and second Monthly
Payments due to the Purchaser, the Seller shall, upon receipt of notice from
the Purchaser, promptly repurchase such Mortgage Loan from the Purchaser in
accordance with this Section; provided, that no right to cure set forth herein
shall apply.
Notwithstanding any provision to the contrary, in the event that a
Mortgage Loan is prepaid in full within sixty days of the related Closing
Date, the Seller shall pay to the Purchaser the purchase price premium paid by
the Purchaser for the Mortgage Loan, reduced by any prepayment penalty fees
received from the borrower and remitted to the Purchaser; provided, however,
in the event that the Purchaser or a subsequent servicer forgives the related
prepayment penalty and still satisfies the Mortgage Loan, the Seller shall pay
to the Purchaser the purchase price premium paid by the Purchaser for the
Mortgage Loan, reduced by the forgiven prepayment penalty amount.
Section 4.04 Post Closing Due Diligence.
From the related Closing Date to a period not to exceed 30 days after the
such Closing Date, the Purchaser shall have the right to review the Mortgage
Files and obtain BPOs on the Mortgaged Properties relating to the Mortgage
Loans purchased on such Closing Date, with the results of such Mortgage File
and BPO reviews to be communicated to the Seller for a period up to 30 days
after such Closing Date. In addition, the Purchaser shall have the right to
reject any Mortgage Loan which in the Purchaser's sole determination (i) fails
to conform to the Underwriting Guidelines or prudent secondary market
underwriting guidelines for similar Mortgage Loans, (ii) is not an acceptable
credit risk, (iii) was underwritten without verification of the borrower's
income and assets and there is no credit report or credit score in the
Mortgage File or (iv) the value of the Mortgaged Property pursuant to any BPO
obtained by the Purchaser is less than 85% or the lesser of (A) the original
appraised value of the Mortgaged Property or (B) the purchase price of the
Mortgaged Property as of the date of origination. In the event that the
Purchaser so rejects any Mortgage Loan, the Seller shall repurchase the
rejected Mortgage Loan at the Repurchase Price in the manner prescribed in
Section 4.03 upon receipt of notice from the Purchaser of the rejection of
such Mortgage Loan. Any rejected Mortgage Loan shall
-31-
be removed from the terms of this Agreement. The Seller shall make available
all files required by Purchaser in order to complete its review. Any review
performed by the Purchaser prior to the Closing Date does not limit the
Purchaser's rights or the Seller's obligations under this Agreement
thereafter. Notwithstanding that a Mortgage Loan is underwritten pursuant to
the related Underwriting Guidelines, if a Mortgage Loan is underwritten
without verification of the borrower's income and assets and there is no
credit report and credit score, the Purchaser has the right to reject such
Mortgage Loan.
Section 4.05 Restrictions and Requirements Applicable in the Event
that a Mortgage Loan is Acquired by a REMIC.
In the event that any Mortgage Loan is held by a REMIC, notwithstanding
any contrary provision of this Agreement, the following provisions shall be
applicable to such Mortgage Loan:
(a) Repurchase of Mortgage Loans.
With respect to any Mortgage Loan that is not in default or as to which no
default is imminent, no purchase or substitution pursuant to Section 4.03 or
7.02 shall be made, unless, if so required by the applicable REMIC Documents
the Seller has obtained an Opinion of Counsel to the effect that such purchase
will not (i) result in the imposition of taxes on "prohibited transactions" of
such REMIC (as defined in Section 860F of the Code) or otherwise subject the
REMIC to tax, or (ii) cause the REMIC to fail to qualify as a REMIC at any
time.
(b) Tax Returns.
(i) With respect to the Mortgage Loans serviced by the Seller under this
Agreement, the Seller covenants and agrees that it shall cooperate and provide
any and all information to enable the trustee or other responsible party to
perform all of the following duties: (1) prepare, file and sign all Tax
Returns using a calendar year as the taxable year for the REMIC and the
accrual method of accounting when and as required by the REMIC Provisions and
other applicable federal income tax laws; (2) make an election, on behalf of
the REMIC to be treated as a REMIC on the Tax Returns of the REMIC for its
first taxable year, in accordance with the REMIC Provisions; (3) prepare and
file or cause to be prepared and filed, and deliver, any and all Tax Returns,
information statements or other filings required to be delivered to any
governmental taxing authority, or to any owner thereunder, pursuant to any
applicable federal, state or local tax law with respect to the REMIC or the
certificates issued thereunder and the transactions contemplated thereby; (4)
cause to be provided to the owner thereunder such data necessary for their
original issue discount computations and market discount computations with
respect to the certificates issued thereunder for federal income tax purposes
as the owner thereunder may reasonably request from time to time; (5) conduct
the affairs of the REMIC so as to maintain the status thereof as a REMIC under
the REMIC Provisions; (6) not knowingly or intentionally take any action or
omit to take any action that would cause the termination of the REMIC status
of the REMIC; (7) make any election required by the REMIC Provisions to treat
as "foreclosure property" within the meaning of Section 860G(a)(8) of the Code
all property that the REMIC has acquired or will acquire that may qualify as
such foreclosure property; (8) cause to be provided notice to the holders of
any certificates issued thereunder of the existence of the
-32-
restrictions on transfers and exchange provided under the REMIC documents; (9)
cause to be provided information necessary for the computation of tax imposed
on the transfer of a residual certificate issued thereunder to a Disqualified
Organization, or an agent of a Disqualified Organization, provided that the
reasonable cost of computing and furnishing such information may be charged to
the person liable for such tax; and (9) in a timely manner cause to be paid
the amount of any and all federal, state and local taxes imposed on the REMIC
or its respective assets or transactions including, without limitation, (i)
"prohibited transaction" penalty taxes as defined in Section 860F of the Code,
if, when and as the same shall be due and payable, (ii) any tax on
contributions to a REMIC after the closing date of such REMIC imposed under
Section 860G(d) of the Code and (iii) any tax on "net income from foreclosure
property" as defined in Section 860G(c) of the Code.
(ii) Within 30 days after the closing date of any REMIC, if so required by
the applicable REMIC Documents, the Seller shall cooperate and provide any and
all information necessary or helpful to enable the trustee or other
responsible party to prepare and file with the Internal Revenue Service Form
8811, "Information Return for Real Estate Mortgage Investment Conduits (REMIC)
and Issuers of Collateralized Debt Obligations" for the REMIC. The trustee or
other responsible party shall sign such returns and is hereby indemnified and
held harmless by the Seller with respect to any tax or liability arising from
the trustee's or other responsible party's signing such information returns to
the extent that such tax or liability results from information provided by or
on behalf of the Seller or information that should have been provided by or on
behalf of the Seller.
(c) General Servicing Obligations.
The Seller shall sell any REO Property within three years after its
acquisition by the REMIC unless (i) the Seller applies for an extension of
such three-year period from the Internal Revenue Service pursuant to the REMIC
Provisions and Code Section 856(e)(3), in which event such REO Property shall
be sold within the applicable extension period, or (ii) the Seller obtains for
the Purchaser an Opinion of Counsel, addressed to the Purchaser and the
Seller, to the effect that the holding by the REMIC of such REO Property
subsequent to such three year period will not result in the imposition of
taxes on "prohibited transactions" as defined in Section 860F of the Code or
cause the REMIC to fail to qualify as a REMIC under the REMIC Provisions or
comparable provisions of relevant state laws at any time. The Seller shall
manage, conserve, protect and operate each REO Property for the Purchaser
solely for the purpose of its prompt disposition and sale in a manner which
does not cause such REO Property to fail to qualify as "foreclosure property"
within the meaning of Section 860G(a)(8) or result in the receipt by the REMIC
of any "income from non-permitted assets" within the meaning of Section
860F(a)(2)(B) of the Code or any "net income from foreclosure property" which
is subject to taxation under Section 860G(a)(1) of the Code. Pursuant to its
efforts to sell such REO Property, the Seller shall either itself or through
an agent selected by the Seller protect and conserve such REO Property in the
same manner and to such extent as is customary in the locality where such REO
Property is located and may, incident to its conservation and protection of
the interests of the Purchaser, rent the same, or any part thereof, as the
Seller deems to be in the best interest of the Seller and the Purchaser for
the period prior to the sale of such REO Property; provided, however, that any
rent received or accrued with respect to such REO Property qualifies as "rents
from real property" as defined in Section 856(d) of the Code.
-33-
(d) Additional Covenants.
In addition to the provision set forth in this Section 5.05(d), if a REMIC
election is made with respect to the arrangement under which any of the
Mortgage Loans or REO Properties are held, then, with respect to such Mortgage
Loans and/or REO Properties, and notwithstanding the terms of this Agreement,
the Seller shall not take any action, cause the REMIC to take any action or
fail to take (or fail to cause to be taken) any action that, under the REMIC
Provisions, if taken or not taken, as the case may be, could (i) endanger the
status of the REMIC as a REMIC or (ii) result in the imposition of a tax upon
the REMIC (including but not limited to the tax on "prohibited transactions"
as defined in Section 860F(a)(2) of the Code and the tax on "contributions" to
a REMIC set forth in Section 860G(d) of the Code) unless the Seller has
received an Opinion of Counsel (at the expense of the party seeking to take
such action) to the effect that the contemplated action will not endanger such
REMIC status or result in the imposition of any such tax.
If a REMIC election is made with respect to the arrangement under which
any Mortgage Loans or REO Properties are held, the Seller shall amend this
Agreement such that it will meet all Rating Agency requirements.
ARTICLE V
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 5.01 Seller to Act as Servicer.
The Seller, as an independent contractor, shall service and administer the
Mortgage Loans from the related Closing Date and shall have full power and
authority, acting alone, to do any and all things in connection with such
servicing and administration which the Seller may deem necessary or desirable,
consistent with the terms of this Agreement and with Accepted Servicing
Practices.
Consistent with the terms of this Agreement, prior to a Mortgage Loan
becoming subject to a Reconstitution Agreement, the Seller may waive, modify
or vary any term of any Mortgage Loan or consent to the postponement of strict
compliance with any such term or in any manner grant indulgence to any
Mortgagor if in the Seller's reasonable and prudent determination such waiver,
modification, postponement or indulgence is not materially adverse to the
Purchaser, provided, however, that the Seller shall not make any future
advances with respect to a Mortgage Loan and (unless the Mortgagor is in
default with respect to the Mortgage Loan or such default is, in the judgment
of the Seller, imminent and the Seller has obtained the prior written consent
of the Purchaser) the Seller shall not permit any modification with respect to
any Mortgage Loan that would change the Mortgage Interest Rate, defer or
forgive the payment of principal or interest, reduce or increase the
outstanding principal balance (except for actual payments of principal) or
change the final maturity date on such Mortgage Loan. Seller agrees and
acknowledges, provided, that, in the event of any such modification which
permits the deferral of interest or principal payments on any Mortgage Loan,
the Seller shall, on the Business Day immediately preceding the Remittance
Date in any month in which any such principal or interest payment has been
deferred, deposit in the Custodial Account from its own
-34-
funds, the difference between (a) such month's principal and one month's
interest at the Mortgage Loan Remittance Rate on the unpaid principal balance
of such Mortgage Loan and (b) the amount paid by the Mortgagor. Without
limiting the generality of the foregoing, the Seller shall continue, and is
hereby authorized and empowered, to execute and deliver on behalf of itself
and the Purchaser, all instruments of satisfaction or cancellation, or of
partial or full release, discharge and all other comparable instruments, with
respect to the Mortgage Loans and with respect to the Mortgaged Properties. If
reasonably required by the Seller, the Purchaser shall promptly furnish the
Seller with any powers of attorney and other documents necessary or
appropriate to enable the Seller to carry out its servicing and administrative
duties under this Agreement.
In servicing and administering the Mortgage Loans, the Seller shall employ
procedures (including collection procedures) and exercise the same care that
it customarily employs and exercises in servicing and administering mortgage
loans for its own account, giving due consideration to Accepted Servicing
Practices where such practices do not conflict with the requirements of this
Agreement, and the Purchaser's reliance on the Seller.
If the Seller is notified that any superior lienholder has accelerated or
intends to accelerate the obligations secured by the superior lien, or has
declared or intends to declare a default under the Mortgage or the Mortgage
Note secured thereby, or has filed or intends to file an election to have the
Mortgaged Property sold or foreclosed, the Seller shall immediately notify the
Purchaser of any such notice from or action by the superior lienholder and of
the amount necessary to cure the default or reinstate the superior lien. The
Seller shall further make recommendations to the Purchaser (including note
sales to third parties) so as to best protect the Purchaser's interest in and
the security of the related Mortgage Loan. If the Purchaser directs the Seller
to cure a default under or otherwise reinstate a superior lien, the Purchaser
will advance to the Seller necessary funds to cure the default or reinstate
the superior lien. The Seller shall thereafter take immediate action to
recover from the Mortgagor the amount so advanced. The Purchaser shall notify
the Seller in writing of any and all action which it requests the Seller to
take.
In the event that the Seller reasonably deems that the factual
circumstances require prompt action, the Seller may (but shall not be
obligated to) without notice to the Purchaser, advance the necessary funds to
cure the default or reinstate the superior lien so as to best protect the
Purchaser's interest. The Seller shall thereafter notify the Purchaser of the
action taken, including the amount of the advance. The Purchaser shall
reimburse the Seller for all advances made pursuant to this paragraph. The
Seller shall thereafter take immediate action to recover from the Mortgagor
the amount so advanced.
Section 5.02 Liquidation of Mortgage Loans.
In the event that any payment due under any Mortgage Loan and not
postponed pursuant to Section 5.01 is not paid when the same becomes due and
payable, or in the event the Mortgagor fails to perform any other covenant or
obligation under the Mortgage Loan and such failure continues beyond any
applicable grace period, the Seller shall take such action as (a) the Seller
would take under similar circumstances with respect to a similar mortgage loan
held for its own account for investment, (b) shall be consistent with Accepted
Servicing Practices, (c) is
-35-
consistent with any related PMI Policy and (d) the Seller shall determine
prudently to be in the best interest of Purchaser, provided, however, that the
Seller shall deliver a notice to the applicable Mortgagor of the Seller's
intent to foreclose (such notice, a "Notice of Intent") by the forty-fifth day
of any monetary delinquency or at such time as permitted under applicable
state law. In the event that any payment due under any Mortgage Loan is not
postponed pursuant to Section 4.01 and remains delinquent for a period of 90
days or any other default continues for a period of no later than 90 days
beyond the expiration of any grace or cure period, the Seller shall commence
foreclosure proceedings and provide notice thereof to the Purchaser in
writing; provided that, the Seller may postpone such foreclosure proceedings
until such payment is delinquent or any other default continues for a period
of no later than 120 days beyond the expiration of any grace or cure period,
if the Seller in its good faith business judgment reasonably believes that the
postponement of such foreclosure proceedings is warranted and the Purchaser
shall not suffer a material loss in connection with such postponement,
provided that, the Seller shall indemnify the Purchaser for any material loss
that may result from such postponement, notwithstanding the Seller's good
faith business judgment. In such connection, the Seller shall from its own
funds make all necessary and proper Servicing Advances, provided, however,
that the Seller shall not be required to expend its own funds in connection
with any foreclosure or towards the restoration, preservation or inspection of
any Mortgaged Property, unless in its good faith business judgment, the Seller
reasonably believes (a) that such preservation, restoration, inspection and/or
foreclosure will increase the proceeds of liquidation of the Mortgage Loan to
Purchaser after reimbursement to itself for such expenses and (b) that such
expenses will be recoverable by it either through Liquidation Proceeds
(respecting which it shall have priority for purposes of withdrawals from the
Custodial Account pursuant to Section 5.05) or through Insurance or
Condemnation Proceeds (respecting which it shall have similar priority). If
the Seller determines not to make a Servicing Advance pursuant to the
preceding sentence, then the Seller shall deliver an Officer's Certificate
setting forth the reasons for such determination.
Section 5.03 Collection of Mortgage Loan Payments.
Continuously from the related Closing Date until the date each Mortgage
Loan ceases to be subject to this Agreement, the Seller shall proceed
diligently to collect all payments due under each of the Mortgage Loans when
the same shall become due and payable and shall take special care in
ascertaining and estimating Escrow Payments and all other charges that will
become due and payable with respect to the Mortgage Loans and each related
Mortgaged Property, to the end that the installments payable by the Mortgagors
will be sufficient to pay such charges as and when they become due and
payable.
Section 5.04 Establishment of and Deposits to Custodial Account.
The Seller shall segregate and hold all funds collected and received
pursuant to a Mortgage Loan separate and apart from any of its own funds and
general assets and shall establish and maintain one or more Custodial
Accounts, in the form of time deposit or demand accounts, titled "Greenpoint
Mortgage Funding Inc. in trust for ▇▇▇▇▇▇ Brothers Bank, purchaser of
Conventional Residential Adjustable and Fixed Rate Mortgage Loans, Group No.
2003-FLOW". The Custodial Account shall be established with a Qualified
Depository acceptable to the Purchaser. Any funds deposited in the Custodial
Account shall at all times be
-36-
fully insured to the full extent permitted under applicable law. Funds
deposited in the Custodial Account may be drawn on by the Seller in accordance
with Section 5.05. The creation of any Custodial Account shall be evidenced by
a certification in the form of Exhibit D-1 hereto, in the case of an account
established with the Seller, or by a letter agreement in the form of Exhibit
D-2 hereto, in the case of an account held by a depository other than the
Seller. A copy of such certification or letter agreement shall be furnished to
the Purchaser and, upon request, to any subsequent purchaser of the Mortgage
Loans.
The Seller shall deposit in the Custodial Account on a daily basis, and
retain therein, the following collections received by the Seller and payments
made by the Seller after the Cut-off Date:
(i) all payments on account of principal on the Mortgage Loans, including
all Principal Prepayments;
(ii) any Prepayment Charge received in connection with the Mortgage Loans;
(iii) all payments on account of interest on the Mortgage Loans adjusted
to the Mortgage Loan Remittance Rate;
(iv) all Liquidation Proceeds;
(v) all Insurance Proceeds including amounts required to be deposited
pursuant to Section 5.11 (other than proceeds to be held in the Escrow Account
and applied to the restoration or repair of the Mortgaged Property or released
to the Mortgagor in accordance with Section 5.15), Section 5.12 and Section
5.15;
(vi) all Condemnation Proceeds which are not applied to the restoration or
repair of the Mortgaged Property or released to the Mortgagor in accordance
with Section 5.15;
(vii) any amount required to be deposited in the Custodial Account
pursuant to Section 5.01, 5.10, 5.11, 5.20, 6.01, 6.03 or 7.02;
(viii) any amounts payable in connection with the repurchase of any
Mortgage Loan pursuant to Section 4.03;
(ix) any amounts required to be deposited by the Seller pursuant to
Section 5.12 in connection with the deductible clause in any blanket hazard
insurance policy;
(x) any amounts required to be deposited by the Seller pursuant to
Section 5.16 in connection with any unpaid claims that are a result of a breach
by the Seller or any subservicer of the obligations hereunder or under the terms
of a PMI Policy;
(xi) any amounts received by the Seller under a PMI or LPMI Policy;
(xii) with respect to each Principal Prepayment in full or in part, the
Prepayment Interest Shortfall Amount, if any, for the month of distribution.
Such deposit shall be
-37-
made from the Seller's own funds, without reimbursement therefor up to a
maximum amount per month of the Servicing Fee actually received for such month
for the Mortgage Loans; and
(xiii) any amounts received with respect to or related to any REO Property
and all REO Disposition Proceeds pursuant to Section 5.17.
The foregoing requirements for deposit into the Custodial Account shall be
exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of Ancillary Income need
not be deposited by the Seller into the Custodial Account. Any interest paid
on funds deposited in the Custodial Account by the depository institution
shall accrue to the benefit of the Seller and the Seller shall be entitled to
retain and withdraw such interest from the Custodial Account pursuant to
Section 5.05.
Section 5.05 Permitted Withdrawals From Custodial Account.
The Seller shall, from time to time, withdraw funds from the Custodial
Account for the following purposes:
(i) to make payments to the Purchaser in the amounts and in the manner
provided for in Section 6.01;
(ii) to reimburse itself for unreimbursed Servicing Advances, the Seller's
right to reimburse itself pursuant to this subclause (ii) with respect to any
Mortgage Loan being limited to related Liquidation Proceeds, Condemnation
Proceeds, Insurance Proceeds, REO Disposition Proceeds and other amounts
received in respect of the related REO Property, and such other amounts as may
be collected by the Seller from the Mortgagor or otherwise relating to the
Mortgage Loan, it being understood that, in the case of any such
reimbursement, the Seller's right thereto shall be prior to the rights of the
Purchaser;
(iii) to pay itself interest on funds deposited in the Custodial Account;
(iv) with respect to each LPMI Loan, an amount equal to the related LPMI
Fee to make payment of premiums due under the LPMI Policy;
(v) to clear and terminate the Custodial Account upon the termination of
this Agreement;
(vi) to withdraw funds deposited in error;
(vii) to invest fund in certain Eligible Investments; and
(viii) to transfer funds to another Custodial Account established with a
Qualified Depository in accordance with Section 5.10.
In the event that the Custodial Account is interest bearing, on each
Remittance Date, the Seller shall withdraw all funds from the Custodial
Account except for those amounts which, pursuant to Section 6.01, the Seller
is not obligated to remit on such Remittance Date. The Seller may use such
withdrawn funds only for the purposes described in this Section 5.05.
-38-
Section 5.06 Establishment of and Deposits to Escrow Account.
The Seller shall segregate and hold all funds collected and received
pursuant to a Mortgage Loan constituting Escrow Payments separate and apart
from any of its own funds and general assets and shall establish and maintain
one or more Escrow Accounts, in the form of time deposit or demand accounts,
titled, "Greenpoint Mortgage Funding Inc., in trust for ▇▇▇▇▇▇ Brothers Bank,
FSB, purchaser of Conventional Residential Adjustable and Fixed Rate Mortgage
Loans, Group No. 2003-FLOW, and various Mortgagors". The Escrow Accounts shall
be established with a Qualified Depository, in a manner which shall provide
maximum available insurance thereunder. Funds deposited in the Escrow Account
may be drawn on by the Seller in accordance with Section 5.07. The creation of
any Escrow Account shall be evidenced by a certification in the form of
Exhibit E-1 hereto, in the case of an account established with the Seller, or
by a letter agreement in the form of Exhibit E-2 hereto, in the case of an
account held by a depository other than the Seller. A copy of such
certification shall be furnished to the Purchaser and, upon request, to any
subsequent purchaser.
The Seller shall deposit in the Escrow Account or Accounts not later than
one Business Date after receipt thereof, and retain therein:
(i) all Escrow Payments collected on account of the Mortgage Loans, for
the purpose of effecting timely payment of any such items as required under
the terms of this Agreement; and
(ii) all amounts representing Insurance Proceeds or Condemnation Proceeds
which are to be applied to the restoration or repair of any Mortgaged
Property.
The Seller shall make withdrawals from the Escrow Account only to effect
such payments as are required under this Agreement, as set forth in Section
5.07. The Seller shall be entitled to retain any interest paid on funds
deposited in the Escrow Account by the depository institution, other than
interest on escrowed funds required by law to be paid to the Mortgagor. To the
extent required by law, the Seller shall pay interest on escrowed funds to the
Mortgagor notwithstanding that the Escrow Account may be non-interest bearing
or that interest paid thereon is insufficient for such purposes.
Section 5.07 Permitted Withdrawals From Escrow Account.
Withdrawals from the Escrow Account or Accounts may be made by the Seller
only:
(i) to effect timely payments of ground rents, taxes, assessments, water
rates, mortgage insurance premiums, condominium charges, fire and hazard
insurance premiums or other items constituting Escrow Payments for the related
Mortgage;
(ii) to reimburse the Seller for any Servicing Advances made by the Seller
pursuant to Section 5.09 with respect to a related Mortgage Loan, but only
from amounts received on the related Mortgage Loan which represent late
collections of Escrow Payments thereunder;
-39-
(iii) to refund to any Mortgagor any funds found to be in excess of the
amounts required under the terms of the related Mortgage Loan;
(iv) for transfer to the Custodial Account and application to reduce the
principal balance of the Mortgage Loan in accordance with the terms of the
related Mortgage and Mortgage Note;
(v) for application to restoration, inspection or repair of the Mortgaged
Property in accordance with the procedures outlined in Section 5.15;
(vi) to pay to the Seller, or any Mortgagor to the extent required by law,
any interest paid on the funds deposited in the Escrow Account;
(vii) to clear and terminate the Escrow Account on the termination of this
Agreement;
(viii) to withdraw funds deposited in error.
The Seller will be responsible for the administration of the Escrow
Accounts and will be obligated to make Servicing Advances to the Escrow
Account in respect of its obligations under this Section 5.07, reimbursable
from the Escrow Accounts or Custodial Account to the extent not collected from
the related Mortgagor, anything to the contrary notwithstanding, when and as
necessary to avoid the lapse of insurance coverage on the Mortgaged Property,
or which the Seller knows, or in the exercise of the required standard of care
of the Seller hereunder should know, is necessary to avoid the loss of the
Mortgaged Property due to a tax sale or the foreclosure as a result of a tax
lien. If any such payment has not been made and the Seller receives notice of
a tax lien with respect to the Mortgage being imposed, the Seller will, within
ten (10) days of such notice, advance or cause to be advanced funds necessary
to discharge such lien on the Mortgaged Property.
Section 5.08 Completion and Recordation of Assignment of Mortgage.
To the extent permitted by applicable law, each of the Assignments of
Mortgage to be prepared by the Seller will be subject to recordation in all
appropriate public offices for real property records in all the counties or
other comparable jurisdictions in which any or all of the Mortgaged Properties
are situated, and in any other appropriate public recording office or
elsewhere.
Section 5.09 Payment of Taxes, Insurance and Other Charges.
(a) With respect to each Mortgage Loan which provides for Escrow Payments,
the Seller shall maintain accurate records reflecting the status of ground
rents, taxes, assessments, water rates, sewer rents, and other charges which
are or may become a lien upon the Mortgaged Property and the status of PMI
Policy premiums and fire and hazard insurance coverage and shall obtain, from
time to time, all bills for the payment of such charges (including renewal
premiums) ("Property Charges") and shall effect payment thereof prior to the
applicable penalty or termination date, employing for such purpose deposits of
the Mortgagor in the Escrow Account which shall have been estimated and
accumulated by the Seller in amounts sufficient for
-40-
such purposes, as allowed under the terms of the Mortgage. The Seller assumes
full responsibility for the timely payment of all such bills and shall effect
timely payment of all such charges irrespective of each Mortgagor's faithful
performance in the payment of same or the making of the Escrow Payments, and
such payments
(b) To the extent that a Mortgage Loan does not provide for Escrow
Payments, the Seller shall make advances from its own funds to effect payment of
all Property Charges upon receipt of notice of any failure to pay on the part of
the Mortgagor, or at such other time as the Seller determines to be in the best
interest of the Purchaser, provided, that in any event the Seller shall pay such
charges on or before the earlier of (a) any date by which payment is necessary
to preserve the lien status of the Mortgage or (b) the date which is ninety days
after the date on which such charges first became due. The Seller shall pay any
late fee or penalty which is payable due to any delay in payment of any Property
Charge after the earlier to occur of (a) the date on which the Seller receives
notice of the failure of the Mortgagor to pay such Property Charge or (b) the
date which is ninety days after the date on which such charges first became due.
Section 5.10 Protection of Accounts.
The Seller may transfer the Custodial Account or the Escrow Account to a
different Qualified Depository from time to time. Such transfer shall be made
only upon obtaining the consent of Purchaser, which consent shall not be
withheld unreasonably.
The Seller shall bear any expenses, losses or damages sustained by the
Purchaser because the Custodial Account and/or the Escrow Account are not
demand deposit accounts.
Amounts on deposit in the Custodial Account and the Escrow Account may at
the option of the Seller be invested in Eligible Investments; provided that in
the event that amounts on deposit in the Custodial Account or the Escrow
Account exceed the amount fully insured by the FDIC (the "Insured Amount") the
Seller shall be obligated to invest the excess amount over the Insured Amount
in Eligible Investments on the same Business Day as such excess amount becomes
present in the Custodial Account or the Escrow Account. Any such Eligible
Investment shall mature no later than the Determination Date next following
the date of such Eligible Investment, provided, however, that if such Eligible
Investment is an obligation of a Qualified Depository (other than the Seller)
that maintains the Custodial Account or the Escrow Account, then such Eligible
Investment may mature on such Remittance Date. Any such Eligible Investment
shall be made in the name of the Seller in trust for the benefit of the
Purchaser. All income on or gain realized from any such Eligible Investment
shall be for the benefit of the Seller and may be withdrawn at any time by the
Seller. Any losses incurred in respect of any such investment shall be
deposited in the Custodial Account or the Escrow Account, by the Seller out of
its own funds immediately as realized.
Section 5.11 Maintenance of Hazard Insurance.
The Seller shall cause to be maintained for each Mortgage Loan hazard
insurance such that all buildings upon the Mortgaged Property are insured by a
generally acceptable insurer acceptable under ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇ Mac
guidelines against loss by fire, hazards of
-41-
extended coverage and such other hazards as are customary in the area where
the Mortgaged Property is located, in an amount which is at least equal to the
lesser of (a) 100% of the maximum insurable value of the improvements securing
such Mortgage Loan and (b) the greater of (i) the outstanding principal
balance of the Mortgage Loan and (ii) an amount such that the proceeds thereof
shall be sufficient to prevent the Mortgagor or the loss payee from becoming a
co-insurer.
If upon origination of the Mortgage Loan, the related Mortgaged Property
was located in an area identified in the Federal Register by the Flood
Emergency Management Agency as having special flood hazards (and such flood
insurance has been made available) a flood insurance policy meeting the
requirements of the current guidelines of the Federal Insurance Administration
is in effect with a generally acceptable insurance carrier rated A:VI or
better in the current edition of Best's Key Rating Guide in an amount
representing coverage equal to the lesser of (i) the minimum amount required,
under the terms of coverage, to compensate for any damage or loss on a
replacement cost basis (or the unpaid balance of the mortgage if replacement
cost coverage is not available for the type of building insured) and (ii) the
maximum amount of insurance which is available under the Flood Disaster
Protection Act of 1973, as amended. If at any time during the term of the
Mortgage Loan, the Seller determines in accordance with applicable law and
pursuant to the ▇▇▇▇▇▇ Mae Guides that a Mortgaged Property is located in a
special flood hazard area and is not covered by flood insurance or is covered
in an amount less than the amount required by the Flood Disaster Protection
Act of 1973, as amended, the Seller shall notify the related Mortgagor that
the Mortgagor must obtain such flood insurance coverage, and if said Mortgagor
fails to obtain the required flood insurance coverage within thirty (30) days
after such notification, the Seller shall immediately force place the required
flood insurance on the Mortgagor's behalf.
If a Mortgage is secured by a unit in a condominium project, the Seller
shall verify that the coverage required of the owner's association, including
hazard, flood, liability, and fidelity coverage, is being maintained in
accordance with then current ▇▇▇▇▇▇ ▇▇▇ requirements, and secure from the
owner's association its agreement to notify the Seller promptly of any change
in the insurance coverage or of any condemnation or casualty loss that may
have a material effect on the value of the Mortgaged Property as security.
The Seller shall cause to be maintained on each Mortgaged Property such
other or additional insurance as may be required pursuant to such applicable
laws and regulations as shall at any time be in force and as shall require
such additional insurance, or pursuant to the requirements of any private
mortgage guaranty insurer, or as may be required to conform with Accepted
Servicing Practices.
In the event that any Purchaser or the Seller shall determine that the
Mortgaged Property should be insured against loss or damage by hazards and
risks not covered by the insurance required to be maintained by the Mortgagor
pursuant to the terms of the Mortgage, the Seller shall, at its discretion,
communicate with the Mortgagor with respect to the need for such insurance and
bring to the Mortgagor's attention the desirability of protection of the
Mortgaged Property.
-42-
All policies required hereunder shall name the Seller as loss payee and
shall be endorsed with standard or union mortgagee clauses, without
contribution, which shall provide for at least 30 days' prior written notice
of any cancellation, reduction in amount or material change in coverage.
The Seller shall not interfere with the Mortgagor's freedom of choice in
selecting either his insurance carrier or agent, provided, however, that the
Seller shall not accept any such insurance policies from insurance companies
unless such companies are rated A:VI or better in Best's Key Rating Guide and
are licensed to do business in the jurisdiction in which the Mortgaged
Property is located. The Seller shall determine that such policies provide
sufficient risk coverage and amounts, that they insure the property owner, and
that they properly describe the property address. The Seller shall furnish to
the Mortgagor a formal notice of expiration of any such insurance in
sufficient time for the Mortgagor to arrange for renewal coverage by the
expiration date.
Pursuant to Section 5.04, any amounts collected by the Seller under any
such policies (other than amounts to be deposited in the Escrow Account and
applied to the restoration or repair of the related Mortgaged Property, or
property acquired in liquidation of the Mortgage Loan, or to be released to
the Mortgagor, in accordance with the Seller's normal servicing procedures as
specified in Section 5.15) shall be deposited in the Custodial Account subject
to withdrawal pursuant to Section 5.05.
Notwithstanding anything set forth in the preceding paragraph, the Seller
agrees to indemnify the Purchaser for any claims, losses, damages, penalties,
fines, forfeitures, legal fees and related costs, judgments, and any other
costs, fees and expenses that the Purchaser may sustain in any way related to
the failure of the Mortgagor (or the Seller) to maintain hazard insurance or
flood insurance with respect to the related Mortgaged Property which complies
with the requirements of this section.
Section 5.12 Maintenance of Mortgage Insurance.
In the event that the Seller shall obtain and maintain a blanket policy
insuring against losses arising from fire and hazards covered under extended
coverage on all of the Mortgage Loans, then, to the extent such policy
provides coverage in an amount equal to the amount required pursuant to
Section 5.11 and otherwise complies with all other requirements of Section
5.11, it shall conclusively be deemed to have satisfied its obligations as set
forth in Section 5.11. Any amounts collected by the Seller under any such
policy relating to a Mortgage Loan shall be deposited in the Custodial Account
or Escrow Account subject to withdrawal pursuant to Sections 5.05 or 5.15.
Such policy may contain a deductible clause, in which case, in the event that
there shall not have been maintained on the related Mortgaged Property a
policy complying with Section 5.11, and there shall have been a loss which
would have been covered by such policy, the Seller shall deposit in the
Custodial Account at the time of such loss the amount not otherwise payable
under the blanket policy because of such deductible clause, such amount to
deposited from the Seller's funds, without reimbursement therefor. Upon
request of any Purchaser, the Seller shall cause to be delivered to such
Purchaser a certified true copy of such policy and a statement from the
insurer thereunder that such policy shall in no event be terminated or
materially modified without 30 days' prior written notice to such Purchaser.
-43-
Section 5.13 Maintenance of Fidelity Bond and Errors and Omissions
Insurance.
The Seller shall maintain with responsible companies, at its own expense,
a blanket Fidelity Bond and an Errors and Omissions Insurance Policy, with
broad coverage on all officers, employees or other Persons acting in any
capacity requiring such Persons to handle funds, money, documents or papers
relating to the Mortgage Loans ("Seller Employees"). Any such Fidelity Bond
and Errors and Omissions Insurance Policy shall be in the form of the Mortgage
Banker's Blanket Bond and shall protect and insure the Seller against losses,
including forgery, theft, embezzlement, fraud, errors and omissions and
negligent acts of such Seller Employees. Such Fidelity Bond and Errors and
Omissions Insurance Policy also shall protect and insure the Seller against
losses in connection with the release or satisfaction of a Mortgage Loan
without having obtained payment in full of the indebtedness secured thereby.
No provision of this Section 5.13 requiring such Fidelity Bond and Errors and
Omissions Insurance Policy shall diminish or relieve the Seller from its
duties and obligations as set forth in this Agreement. The minimum coverage
under any such bond and insurance policy shall be at least equal to the
corresponding amounts required by ▇▇▇▇▇▇ Mae in the ▇▇▇▇▇▇ ▇▇▇ Guides or by
▇▇▇▇▇▇▇ Mac in the ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇' & Servicers' Guide. Upon the request
of the Purchaser, the Seller shall cause to be delivered to such Purchaser a
certified true copy of such fidelity bond and insurance policy and a statement
from the surety and the insurer that such fidelity bond and insurance policy
shall in no event be terminated or materially modified without 30 days' prior
written notice to the Purchaser.
Section 5.14 Inspections.
The Seller shall inspect the Mortgaged Property as often as deemed
necessary by the Seller to assure itself that the value of the Mortgaged
Property is being preserved. In addition, if any Mortgage Loan is more than 45
days delinquent, the Seller immediately shall inspect the Mortgaged Property
and shall conduct subsequent inspections in accordance with Accepted Servicing
Practices or as may be required by the primary mortgage guaranty insurer. The
Seller shall keep a written report of each such inspection.
Section 5.15 Restoration of Mortgaged Property.
The Seller need not obtain the approval of the Purchaser prior to
releasing any Insurance Proceeds or Condemnation Proceeds to the Mortgagor to
be applied to the restoration or repair of the Mortgaged Property if such
release is in accordance with Accepted Servicing Practices. At a minimum, the
Seller shall comply with the following conditions in connection with any such
release of Insurance Proceeds or Condemnation Proceeds:
(i) the Seller shall receive satisfactory independent verification of
completion of repairs and issuance of any required approvals with respect
thereto;
(ii) the Seller shall take all steps necessary to preserve the priority of
the lien of the Mortgage, including, but not limited to requiring waivers with
respect to mechanics' and materialmen's liens;
(iii) the Seller shall verify that the Mortgage Loan is not in default;
and
-44-
(iv) pending repairs or restoration, the Seller shall place the Insurance
Proceeds or Condemnation Proceeds in the Escrow Account.
If the Purchaser is named as an additional loss payee, the Seller is
hereby empowered to endorse any loss draft issued in respect of such a claim
in the name of the Purchaser.
Section 5.16 Maintenance of PMI and/or LPMI Policy; Claims.
(a) The Seller shall comply with all provisions of applicable state and
federal law relating to the cancellation of, or collection of premiums with
respect to, PMI Policies, including, but not limited to, the provisions of the
HomePurchasers Protection Act of 1998, and all regulations promulgated
thereunder, as amended from time to time. The Seller shall be obligated to
make premium payments with respect to (i) LPMI Policies, to the extent of the
LPMI Fee set forth on the Mortgage Loan Schedule with respect to any LPMI
Loans, which shall be paid out of the interest portion of the related Monthly
Payment or, if a Monthly Payment is not made, from the Seller's own funds and
(ii) PMI Policies required to be maintained by the Mortgagor rather than the
Purchaser, if the Mortgagor is required but fails to pay any PMI Policy
premium, which shall be paid from the Seller's own funds. Any premium payments
made by the Seller from its own funds pursuant to this Section 5.16(a) shall
be recoverable by the Seller as a Servicing Advance, subject to the
reimbursement provisions of Section 5.05(iii) and 5.05(vii).
With respect to each Mortgage Loan (other than LPMI Loans) with a loan-to-
value ratio at origination in excess of 80%, the Seller shall maintain or
cause the Mortgagor to maintain (to the extent that the Mortgage Loan requires
the Mortgagor to maintain such insurance) in full force and effect a PMI
Policy, and shall pay or shall cause the Mortgagor to pay the premium thereon
on a timely basis, until the LTV of such Mortgage Loan is reduced to 80%. In
the event that such PMI Policy shall be terminated, the Seller shall obtain
from another Qualified Insurer a comparable replacement policy, with a total
coverage equal to the remaining coverage of such terminated PMI Policy, at
substantially the same fee level. The Seller shall not take any action which
would result in noncoverage under any applicable PMI Policy of any loss which,
but for the actions of the Seller would have been covered thereunder. In
connection with any assumption or substitution agreements entered into or to
be entered into with respect to a Mortgage Loan, the Seller shall promptly
notify the insurer under the related PMI Policy, if any, of such assumption or
substitution of liability in accordance with the terms of such PMI Policy and
shall take all actions which may be required by such insurer as a condition to
the continuation of coverage under such PMI Policy. If such PMI Policy is
terminated as a result of such assumption or substitution of liability, the
Seller shall obtain a replacement PMI Policy as provided above.
(b) With respect to each Mortgage Loan covered by a PMI Policy or LPMI
Policy, the Seller shall take all such actions on behalf of the Purchaser as
are necessary to service, maintain and administer the related Mortgage Loan in
accordance with such Policy and to enforce the rights under such Policy.
Except as expressly set forth herein, the Seller shall have full authority on
behalf of the Purchaser to do anything it deems appropriate or desirable in
connection with the servicing, maintenance and administration of such Policy;
provided that the Seller shall not take any action to permit any modification
or assumption of a Mortgage Loan covered by a LPMI or PMI Policy, or take any
other action with respect to such Mortgage Loan,
-45-
which would result in non-coverage under such Policy of any loss which, but
for actions of the Seller, would have been covered thereunder. If the
Qualified Insurer fails to pay a claim under a LPMI or PMI Policy solely as a
result of a breach by the Seller of its obligations hereunder or under such
Policy, the Seller shall be required to deposit in the Custodial Account on or
prior to the next succeeding Remittance Date an amount equal to such unpaid
claim from its own funds without any rights to reimbursement from the
Purchaser; provided, that once the Seller has paid the amount of such unpaid
claim and the Purchaser has otherwise fully recovered all amounts due to the
Purchaser with respect to the Mortgage Loan, the Purchaser shall (at the
Seller's cost and expense) cooperate with the Seller in permitting the Seller
to be subrogated to the rights of the Purchaser with respect to such Mortgage
Loan to the same extent that the insurer would have been subrogated under the
applicable PMI Policy had such insurer not failed to pay such claim. The
Seller shall cooperate with the Qualified Insurers and shall furnish all
reasonable evidence and information in the possession of the Seller to which
the Seller has access with respect to the related Mortgage Loan; provided,
however, notwithstanding anything to the contrary contained in any LPMI Policy
or PMI Policy, the Seller shall not be required to submit any reports to the
related Qualified Insurer until a reporting date that is at least 15 days
after the Seller has received sufficient loan level information from each
Purchaser to appropriately code its servicing systems in accordance with the
Qualified Insurer's requirements.
(c) In connection with its activities as Seller, the Seller agrees to
prepare and present, on behalf of itself and the Purchaser, claims to the
Qualified Insurer under any PMI Policy or LPMI Policy in a timely fashion in
accordance with the terms of such PMI Policy or LPMI Policy and, in this
regard, to take such action as shall be necessary to permit recovery under any
PMI Policy or LPMI Policy respecting a defaulted Mortgage Loan. Any amounts
collected by the Seller under any PMI Policy or LPMI Policy shall be deposited
in the Custodial Account pursuant to Section 5.03(xi), subject to withdrawal
pursuant to Section 5.04(iv).
Section 5.17 Title, Management and Disposition of REO Property.
In the event that title to any Mortgaged Property is acquired in
foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale
shall be taken in the name of the Purchaser's designee, or in the event the
Purchaser's designee is not authorized or permitted to hold title to real
property in the state where the REO Property is located, or would be adversely
affected under the "doing business" or tax laws of such state by so holding
title, the deed or certificate of sale shall be taken in the name of such
Person or Persons as shall be consistent with an Opinion of Counsel obtained
by the Seller from any attorney duly licensed to practice law in the state
where the REO Property is located. The Person or Persons holding such title
other than the Purchaser shall acknowledge in writing that such title is being
held as nominee for the Purchaser's designee.
The Seller shall manage, conserve, protect and operate each REO Property
for the Purchaser solely for the purpose of its prompt disposition and sale.
The Seller, either itself or through an agent selected by the Seller, shall
manage, conserve, protect and operate the REO Property in the same manner that
it manages, conserves, protects and operates other foreclosed property for its
own account, and in the same manner that similar property in the same locality
as the REO Property is managed. The Seller shall attempt to sell the same (and
may temporarily
-46-
rent the same for a period not greater than one year, except as otherwise
provided below) on such terms and conditions as the Seller deems to be in the
best interest of the Purchaser.
The Seller shall use its best efforts to dispose of the REO Property as
soon as possible and shall sell such REO Property in any event within three
years after title has been taken to such REO Property, not later than the end
of the third taxable year after the year of its acquisition unless (i) (A) a
REMIC election has not been made with respect to the arrangement under which
the Mortgage Loans and the REO Property are held, and (ii) the Seller
determines, and gives an appropriate notice to the Purchaser to such effect,
that a longer period is necessary for the orderly liquidation of such REO
Property. If a period longer than three years is permitted under the foregoing
sentence and is necessary to sell any REO Property, (i) the Seller shall
report monthly to the Purchaser as to the progress being made in selling such
REO Property and (ii) if, with the written consent of the Purchaser, a
purchase money mortgage is taken in connection with such sale, such purchase
money mortgage shall name the Seller as mortgagee, and such purchase money
mortgage shall not be held pursuant to this Agreement, but instead a separate
participation agreement among the Seller and Purchaser shall be entered into
with respect to such purchase money mortgage.
Notwithstanding anything to the contrary contained in this Section 3.17,
in connection with a foreclosure or acceptance of a deed in lieu of
foreclosure, in the event the Seller has reasonable cause to believe that a
Mortgaged Property is contaminated by hazardous or toxic substances or wastes,
or if the Purchaser otherwise requests, an environmental inspection or review
of such Mortgaged Property to be conducted by a qualified inspector shall be
arranged by the Seller. Upon completion of the inspection, the Seller shall
provide the Purchaser with a written report of such environmental inspection.
In the event that the environmental inspection report indicates that the
Mortgaged Property is contaminated by hazardous or toxic substances or wastes,
the Seller shall not proceed with foreclosure or acceptance of a deed in lieu
of foreclosure. In the event that the environmental inspection report is
inconclusive as to the whether or not the Mortgaged Property is contaminated
by hazardous or toxic substances or wastes, the Seller shall not, without the
prior approval of the Purchaser, proceed with foreclosure or acceptance of a
deed in lieu of foreclosure. In the event the Purchaser or its designee
directs the Seller not to proceed with foreclosure or acceptance of a deed in
lieu of foreclosure, the Seller shall be reimbursed for all Servicing Advances
made with respect to the related Mortgaged Property from the Custodial Account
pursuant to Section 3.04 hereof.
Subject to the approval of the Purchaser or its designee as described in
this paragraph, the disposition of REO Property shall be carried out by the
Seller at such price, and upon such terms and conditions, as the Seller deems
to be in the best interests of the Purchaser. Prior to acceptance by the
Seller of an offer to sell any REO Property, the Seller shall notify the
Purchaser or its designee of such offer in writing which notification shall
set forth all material terms of said offer (each a "Notice of Sale"). The
Purchaser or its designee shall be deemed to have approved the sale of any REO
Property unless the Purchaser or its designee notifies the Seller in writing,
within 2 Business Days after its receipt of the related Notice of Sale, that
it disapproves of the related sale, in which case the Seller shall not proceed
with such sale.
The Seller shall also maintain on each REO Property fire and hazard
insurance with extended coverage in amount which is at least equal to the
maximum insurable value of the
-47-
improvements which are a part of such property, liability insurance and, to
the extent required and available under the Flood Disaster Protection Act of
1973, as amended, flood insurance in the amount required above.
The proceeds of sale of the REO Property shall be promptly deposited in
the Custodial Account. As soon as practical thereafter the expenses of such
sale shall be paid and the Seller shall reimburse itself for any related
unreimbursed Servicing Advances, unpaid Servicing Fees and unreimbursed
advances made pursuant to this Section or Section 5.03, and on the Remittance
Date immediately following the Principal Prepayment Period in which such sale
proceeds are received the net cash proceeds of such sale remaining in the
Custodial Account shall be distributed to the Purchaser.
The Seller shall make advances of all funds necessary for the proper
operation, management and maintenance of the REO Property, including the cost
of maintaining any hazard insurance pursuant to Section 5.11, such advances to
be reimbursed from the disposition or liquidation proceeds of the REO
Property. The Seller shall make monthly distributions on each Remittance Date
to the Purchaser of the net cash flow from the REO Property (which shall equal
the revenues from such REO Property net of the expenses described in this
Section 5.17 and of any reserves reasonably required from time to time to be
maintained to satisfy anticipated liabilities for such expenses).
Section 5.18 Real Estate Owned Reports.
Together with the statement furnished pursuant to Section 6.02, the Seller
shall furnish to the Purchaser or its designee on or before the tenth (10th)
calendar day of each month a statement with respect to any REO Property
covering the operation of such REO Property for the previous month and the
Seller's efforts in connection with the sale of such REO Property and any
rental of such REO Property incidental to the sale thereof for the previous
month. That statement shall be accompanied by such other information as the
Purchaser or its designee shall reasonably request.
Section 5.19 Liquidation Reports.
Upon the foreclosure sale of any Mortgaged Property or the acquisition
thereof by the Purchaser pursuant to a deed in lieu of foreclosure, the Seller
shall submit to the Purchaser a liquidation report with respect to such
Mortgaged Property. In addition, the Seller shall provide the Purchaser or its
designee a report of Servicing Advances and other expenses in connection with
the liquidation of any Mortgage Loan.
Section 5.20 Notification of Adjustments.
With respect to each ARM Mortgage Loan, the Seller shall adjust the
Mortgage Interest Rate on the related Interest Rate Adjustment Date in
compliance with the requirements of applicable law and the related Mortgage
and Mortgage Note. The Seller shall execute and deliver any and all necessary
notices required under applicable law and the terms of the related Mortgage
Note and Mortgage regarding the Mortgage Interest Rate adjustments. The Seller
shall promptly, upon written request therefor, deliver to the Purchaser such
notifications and any additional applicable data regarding such adjustments
and the methods used to calculate and
-48-
implement such adjustments. Upon the discovery by the Seller or the receipt of
notice from the Purchaser that the Seller has failed to adjust a Mortgage
Interest Rate in accordance with the terms of the related Mortgage Note, the
Seller shall immediately deposit in the Custodial Account from its own funds
the amount of any interest loss or deferral caused the Purchaser thereby.
Section 5.21 Reports of Foreclosures and Abandonments of Mortgaged
Property.
Following the foreclosure sale or abandonment of any Mortgaged Property,
the Seller shall report such foreclosure or abandonment as required pursuant
to Section 6050J of the Code.
Section 5.22 Prepayment Charges.
The Seller or any designee of the Seller shall not waive any Prepayment
Charge with respect to any Mortgage Loan which contains a Prepayment Charge
which prepays during the term of the penalty. If the Seller or its designee
fails to collect the Prepayment Charge upon any prepayment of any Mortgage
Loan which contains a Prepayment Charge, the Seller shall pay the Purchaser an
amount equal to the Prepayment Charge which was not collected. Notwithstanding
the above, the Seller or its designee may waive a Prepayment Charge without
paying the Purchaser the amount of the Prepayment Charge if (i) the Mortgage
Loan is in default (defined as 61 days or more delinquent) and such waiver
would maximize recovery of total proceeds taking into account the value of
such Prepayment Charge and the related Mortgage Loan or (ii) if the prepayment
is not a result of a refinance by the Seller or any of its affiliates and (a)
the Mortgage Loan is foreseen to be in default and such waiver would maximize
recovery of total proceeds taking into account the value of such Prepayment
Charge and the related Mortgage Loan or (b) the collection of the Prepayment
Charge would be in violation of applicable laws.
Section 5.23 Credit Reporting.
For each Mortgage Loan, the Seller shall accurately and fully furnish, in
accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (e.g., favorable and
unfavorable) on its borrower credit files to each of the following credit
repositories: Equifax Credit Information Services, Inc., Trans Union, LLC and
Experian Information Solution, Inc., on a monthly basis.
Section 5.24 Safeguarding Customer Information.
The Seller has implemented and will maintain security measures designed to
meet the objectives of the Interagency Guidelines Establishing Standards for
Safeguarding Customer Information published in final form on February 1, 2001,
66 Fed. Reg. 8616, and the rules promulgated thereunder, as amended from time
to time (the "Guidelines").
The Seller shall promptly provide the Purchaser information regarding such
security measures upon the reasonable request of the Purchaser or its designee
(including any Master Servicer of the Mortgage Loans) which information shall
include, but not be limited to,
-49-
any Statement on Auditing Standards (SAS) No. 70 report covering the Seller's
operations, and any other audit reports, summaries of test results or
equivalent measures taken by the Seller with respect to its security measures.
ARTICLE VI
PAYMENTS TO PURCHASER
Section 6.01 Remittances.
On each Remittance Date the Seller shall remit by wire transfer of
immediately available funds to the Purchaser: (a) all amounts deposited in the
Custodial Account as of the close of business on the last day of the related
Due Period (net of charges against or withdrawals from the Custodial Account
pursuant to Section 5.05), plus (b) all amounts, if any, which the Seller is
obligated to distribute pursuant to Section 6.04, minus (c) any amounts
attributable to Principal Prepayments, Liquidation Proceeds, Insurance
Proceeds, Condemnation Proceeds or REO Disposition Proceeds received after the
applicable Due Period which amounts shall be remitted on the following
Remittance Date, together with any additional interest required to be
deposited in the Custodial Account in connection with such Principal
Prepayment in accordance with Section 5.04(xii), and minus (d) any amounts
attributable to Monthly Payments collected but due on a due date or dates
subsequent to the first day of the month of the Remittance Date, which amounts
shall be remitted on the Remittance Date next succeeding the Due Date related
to such Monthly Payment.
With respect to any remittance received by the Purchaser after the second
Business Day following the Business Day on which such payment was due, the
Seller shall pay to the Purchaser interest on any such late payment at an
annual rate equal to the Prime Rate, adjusted as of the date of each change,
plus three percentage points, but in no event greater than the maximum amount
permitted by applicable law. Such interest shall be deposited in the Custodial
Account by the Seller on the date such late payment is made and shall cover
the period commencing with the day following such second Business Day and
ending with the Business Day on which such payment is made, both inclusive.
Such interest shall be remitted along with the distribution payable on the
next succeeding Remittance Date. The payment by the Seller of any such
interest shall not be deemed an extension of time for payment or a waiver of
any Event of Default by the Seller.
Section 6.02 Statements to Purchaser.
Not later than the tenth (10th) calendar day of each month, the Seller
shall furnish to the Purchaser or its designee (a) a monthly remittance advice
in the format set forth in Exhibit F-1 hereto and a monthly defaulted loan
report in the format set forth in Exhibit F-2 hereto (or in such other format
mutually agreed to between the Seller and the Purchaser) relating to the
period ending on the last day of the preceding calendar month and (b) all such
information required pursuant to clause (a) above on a magnetic tape or other
similar media reasonably acceptable to the Purchaser.
-50-
Such obligation of the Seller shall be deemed to have been satisfied to
the extent that substantially comparable information shall be provided by the
Seller pursuant to any requirements of the Internal Revenue Code as from time
to time are in force.
The Seller shall prepare any and all tax returns, information statements
or other filings required to be delivered to any governmental taxing authority
or to any Purchaser pursuant to any applicable law with respect to the
Mortgage Loans and the transactions contemplated hereby. In addition, the
Seller shall provide each Purchaser with such information concerning the
Mortgage Loans as is necessary for such Purchaser to prepare its federal
income tax return as any Purchaser may reasonably request from time to time.
Section 6.03 Due Dates Other Than the First of the Month.
After Reconstitution, Mortgage Loans having Due Dates other than the first
day of a month, including Mortgage Loans permitting semi-annual amortization
of principal, shall be accounted for as described in this Section 6.03. Any
payment due on a day other than the first day of each month shall be
considered due on the first day of the month following the month in which that
payment is due as if such payment were due on the first day of said month. For
example, a payment due on August 15 shall be considered to be due on September
1. With respect to a Mortgage Note permitting semi-annual amortization of
principal, the Seller shall be required to remit monthly scheduled principal
and interest based on a monthly amortization schedule. Any payment collected
on a Mortgage Loan after each Cut-off Date shall be deposited in the Custodial
Account. For Mortgage Loans with Due Dates on the first day of a month,
deposits to the Custodial Account begin with the payment due on the first of
the month following each Cut-off Date.
Section 6.04 Monthly Advances by Seller.
The Seller shall deposit in the Custodial Account on the Business Day
immediately preceding each Remittance Date, from its own funds or from amount
held for future distribution, or both, an amount equal to all Monthly Payments
(with interest adjusted to the Mortgage Loan Remittance Rate) which were due
on the Mortgage Loans during the applicable Due Period and which were
delinquent at the close of business on the immediately preceding Determination
Date or which were deferred pursuant to Section 6.01. Any amounts held for
future distribution and so used shall be replaced by the Seller by deposit in
the Custodial Account on or before any future Remittance Date if funds in the
Custodial Account on such Remittance Date shall be less than remittances to
the Purchaser required to be made on such Remittance Date. The Seller's
obligation to make such Monthly Advances as to any Mortgage Loan will continue
through the last Monthly Payment due prior to the payment in full of the
Mortgage Loan, or through the last Remittance Date prior to the Remittance
Date for the distribution of all Liquidation Proceeds and other payments or
recoveries (including Insurance Proceeds and Condemnation Proceeds) with
respect to the Mortgage Loan.
-51-
ARTICLE VII
GENERAL SERVICING PROCEDURES
Section 7.01 Transfers of Mortgaged Property.
The Seller shall use its best efforts to enforce any "due-on-sale"
provision contained in any Mortgage or Mortgage Note and to deny assumption by
the person to whom the Mortgaged Property has been or is about to be sold
whether by absolute conveyance or by contract of sale, and whether or not the
Mortgagor remains liable on the Mortgage and the Mortgage Note. When the
Mortgaged Property has been conveyed by the Mortgagor, the Seller shall, to
the extent it has knowledge of such conveyance, exercise its rights to
accelerate the maturity of such Mortgage Loan under the "due-on-sale" clause
applicable thereto, provided, however, that the Seller shall not exercise such
rights if prohibited by law from doing so or if the exercise of such rights
would impair or threaten to impair any recovery under the related PMI Policy,
if any.
If the Seller reasonably believes it is unable under applicable law to
enforce such "due-on-sale" clause, the Seller shall enter into (i) an
assumption and modification agreement with the person to whom such property
has been conveyed, pursuant to which such person becomes liable under the
Mortgage Note and the original Mortgagor remains liable thereon or (ii) in the
event the Seller is unable under applicable law to require that the original
Mortgagor remain liable under the Mortgage Note and the Seller has the prior
consent of the primary mortgage guaranty insurer, a substitution of liability
agreement with the purchaser of the Mortgaged Property pursuant to which the
original Mortgagor is released from liability and the purchaser of the
Mortgaged Property is substituted as Mortgagor and becomes liable under the
Mortgage Note. If an assumption fee is collected by the Seller for entering
into an assumption agreement, a portion of such fee, up to an amount equal to
one-half of one percent (0.5%) of the outstanding principal balance of the
related Mortgage Loan, will be retained by the Seller as additional servicing
compensation, and any portion thereof in excess of one-half of one percent
(0.5%) shall be deposited in the Custodial Account for the benefit of the
Purchaser. In connection with any such assumption, neither the Mortgage
Interest Rate borne by the related Mortgage Note, the term of the Mortgage
Loan nor the outstanding principal amount of the Mortgage Loan shall be
changed.
To the extent that any Mortgage Loan is assumable, the Seller shall
inquire diligently into the creditworthiness of the proposed transferee, and
shall use the underwriting criteria for approving the credit of the proposed
transferee which are used by the Seller with respect to underwriting mortgage
loans of the same type as the Mortgage Loans. If the credit of the proposed
transferee does not meet such underwriting criteria, the Seller diligently
shall, to the extent permitted by the Mortgage or the Mortgage Note and by
applicable law, accelerate the maturity of the Mortgage Loan.
Section 7.02 Satisfaction of Mortgages and Release of Mortgage Files.
Upon the payment in full of any Mortgage Loan, or the receipt by the
Seller of a notification that payment in full will be escrowed in a manner
customary for such purposes, the
-52-
Seller shall notify the Purchaser in the Monthly Remittance Advice as provided
in Section 6.02, and may request the release of any Mortgage Loan Documents
from the Purchaser in accordance with this Section 7.02.
If the Seller satisfies or releases a Mortgage without first having
obtained payment in full of the indebtedness secured by the Mortgage or should
the Seller otherwise prejudice any rights the Purchaser may have under the
mortgage instruments, the Seller shall deposit into the Custodial Account the
entire outstanding principal balance, plus all accrued interest on such
Mortgage Loan, on the day preceding the Remittance Date in the month following
the date of such release. The Seller shall maintain the Fidelity Bond and
Errors and Omissions Insurance Policy as provided for in Section 5.13 insuring
the Seller against any loss it may sustain with respect to any Mortgage Loan
not satisfied in accordance with the procedures set forth herein.
Section 7.03 Servicing Compensation.
As consideration for servicing the Mortgage Loans subject to this
Agreement, the Seller shall retain the relevant Servicing Fee for each
Mortgage Loan remaining subject to this Agreement during any month or part
thereof. Such Servicing Fee shall be payable monthly. Additional servicing
compensation in the form of Ancillary Income shall be retained by the Seller
and is not required to be deposited in the Custodial Account. The obligation
of the Purchaser to pay the Servicing Fee is limited to, and the Servicing Fee
is payable solely from, the interest portion (including recoveries with
respect to interest from Liquidation Proceeds) of such Monthly Payment
collected by the Seller.
The Seller shall be required to pay all expenses incurred by it in
connection with its servicing activities hereunder and shall not be entitled
to reimbursement thereof except as specifically provided for herein.
Section 7.04 Annual Audit Report.
On or before February 28 of each calendar year, commencing February 28,
2004, the Seller shall, at its own expense, cause a firm of independent public
accountants (who may also render other services to the Seller), which is a
member of the American Institute of Certified Public Accountants, to furnish
to the Purchaser (i) year-end audited (if available) financial statements of
the Seller and (ii) a statement to the effect that such firm has examined
certain documents and records for the preceding fiscal year (or during the
period from the date of commencement of such Seller's duties hereunder until
the end of such preceding fiscal year in the case of the first such
certificate) and that, on the basis of such examination conducted
substantially in compliance with the Uniform Single Attestation Program for
Mortgage Bankers, such firm is of the opinion that the Seller's overall
servicing operations have been conducted in compliance with the Uniform Single
Attestation Program for Mortgage Bankers except for such exceptions that, in
the opinion of such firm, the Uniform Single Attestation Program for Mortgage
Bankers requires it to report, in which case such exceptions shall be set
forth in such statement.
-53-
Section 7.05 Annual Officer's Certificate.
On or before February 28 of each calendar year, commencing February 28,
2004, the Seller shall, at its own expense, deliver to the Purchaser a
Servicing Officer's certificate stating, as to each signer thereof, that (i) a
review of the activities of the Seller during such preceding fiscal year and
of performance under this Agreement has been made under such officers'
supervision, and (ii) to the best of such officers' knowledge, based on such
review, the Seller has fulfilled all its obligations under this Agreement for
such year, or, if there has been a default in the fulfillment of all such
obligations, specifying each such default known to such officers and the
nature and status thereof including the steps being taken by the Seller to
remedy such default.
Section 7.06 Right to Examine Seller Records.
The Purchaser shall have the right to examine and audit any and all of the
books, records, or other information of the Seller, whether held by the Seller
or by another on its behalf, with respect to or concerning this Agreement or
the Mortgage Loans, during business hours or at such other times as may be
reasonable under applicable circumstances, upon reasonable advance notice.
The Seller shall provide to the Purchaser and any supervisory agents or
examiners representing a state or federal governmental agency having
jurisdiction over the Purchaser or the Master Servicer, including without
limitation the OTS, the FDIC and other similar entities, access to any
documentation regarding the Mortgage Loans in the possession of the Seller
that is required by any applicable regulations. Such access shall be afforded
without charge, upon reasonable request, during normal business hours, at the
offices of the Seller and in accordance with any applicable regulations.
ARTICLE VIII
AGENCY TRANSFER; PASS-THROUGH TRANSFER
Section 8.01 Removal of Mortgage Loans from Inclusion Under this Agreement
Upon an Agency Transfer, or a Pass-Through Transfer on One or
More Reconstitution Dates.
The Purchaser and the Seller agree that with respect to some or all of the
Mortgage Loans, from time to time the Purchaser shall:
(1) Effect an Agency Transfer, and/or
(2) Effect a Whole Loan Transfer, and/or
(3) Effect a Pass-Through Transfer,
in each case retaining the Seller as the Seller thereof to service the
Mortgage Loans on a "scheduled/scheduled" basis. On the related Reconstitution
Date, the
-54-
Mortgage Loans transferred shall cease to be covered by this Agreement, except
with respect to the right of the Purchaser to cause a transfer of the
servicing responsibilities with respect to the Mortgage Loans in accordance
with Section 8.02 hereof.
(a) The Seller shall cooperate with the Purchaser in connection with any
Agency Transfer, Pass-Through Transfer or Whole Loan Transfer contemplated by
the Purchaser pursuant to this Section 8.01. In that connection, the Seller
shall:
(i) execute any Reconstitution Agreement within a reasonable period of
time after receipt of any Reconstitution Agreement which time shall be
sufficient for the Seller and Seller's counsel to review such Reconstitution
Agreement, but such time shall not exceed ten (10) days after such receipt; in
the case of any Agency Transfer, the Reconstitution Agreements shall be those
customarily employed by ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac for transactions of such
nature. Such Reconstitution Agreement may require the Seller to remit premium
payments with respect to any LPMI Policy to the related insurer;
(ii) cooperate fully with the Purchaser, ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, the
trustee or a third party purchaser and any prospective purchaser, at the
Purchaser's expense, with respect to all reasonable requests and due diligence
procedures including participating in meetings with rating agencies, ▇▇▇▇▇▇
Mae, ▇▇▇▇▇▇▇ Mac, bond insurers, guarantors, loss mitigation or credit risk
management advisors and such other parties as the Purchaser shall designate
and participating in meetings with prospective purchasers of the Mortgage
Loans or interests therein and providing information contained in the Mortgage
Loan Schedule including any diskette or other related data tapes provided as
reasonably requested by such purchasers;
(iii) negotiate and execute one or more loss mitigation advisory or credit
risk management agreements between the Seller and any loss mitigation or
credit risk management advisor designated by the Purchaser in its sole
discretion;
(iv) deliver to the Purchaser and to any Person designated by the
Purchaser (a) for inclusion in any prospectus or other offering material such
publicly available information regarding the Seller, its financial condition
and its mortgage loan delinquency, foreclosure and loss experience and any
additional information requested by the Purchaser, (b) any similar non-public,
unaudited financial information (which the Purchaser may, at its option and at
its cost, have audited by certified public accountants) and such other
information as is reasonably requested by the Purchaser and which the Seller
is capable of providing without unreasonable effort or expense, and to
indemnify the Purchaser and its affiliates for material misstatements
contained in such information, and (c) such statements and audit letters of
reputable, certified public accountants pertaining to information provided by
the Seller pursuant to clause (a) above as shall be reasonably requested by
the Purchaser; and
(v) provide, on an ongoing basis from information obtained through its
servicing of the Mortgage Loans, any information necessary to enable the "tax
matters person" for any REMIC in a Pass-Through Transfer, including any Master
Servicer or trustee acting in such capacity, to perform its obligations in
accordance with applicable law and customary secondary mortgage market
standards for securitized transactions.
-55-
(b) The Seller shall provide to the Purchaser or issuer, as the case may
be, and any other participants in such Agency Transfer, Whole Loan Transfer or
Pass-Through Transfer, (i) any and all information with respect to itself, its
servicing portfolio or the Mortgage Loans and appropriate verification of
information which may be reasonably available to the Seller, whether through
letters of its auditors and counsel or otherwise, as the Purchaser or any such
other participant shall request upon reasonable demand and (ii) such
additional representations, warranties, covenants, opinions of counsel,
letters from auditors, and certificates of public officials or officers of the
Seller as are reasonably believed necessary by ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, the
trustee, such third party purchaser, any Master Servicer, any Rating Agency or
the Purchaser, as the case may be, in connection with such transactions.
(c) If requested by Purchaser, for so long as a certificate under the
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2003, as amended, ("▇▇▇▇▇▇▇▇-▇▇▇▇▇") is required to be
given on behalf of the trust fund pursuant to any Reconstitution, no later
than February 28th of each year (or if not a Business Day, the immediately
preceding Business Day), or at any other time that a party provides a
certification pursuant to ▇▇▇▇▇▇▇▇-▇▇▇▇▇ and the related Reconstitution, and
upon thirty (30) days written request of such parties, an officer of the
Seller shall execute and deliver an Officer's Certificate to the appropriate
parties for the benefit of the trust fund and the required parties and their
officers, directors and affiliates.
(d) To the extent required by the applicable Reconstitution Agreements or
otherwise requested by the Purchaser in connection with a Reconstitution, the
Seller shall prepare Assignments of Mortgage in form and substance acceptable to
▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ Mac, the trustee or such third party, as the case may be,
for each Mortgage Loan that is part of a Reconstitution. The Seller shall
execute each Assignment of Mortgage, track such Assignments of Mortgage to
ensure they have been recorded and deliver them as required by ▇▇▇▇▇▇ Mae,
▇▇▇▇▇▇▇ Mac, the trustee or such third party, as the case may be, upon the
Seller's receipt thereof. The Purchaser shall pay all pre-approved, reasonable
and necessary fees associated with the preparation, recording and tracking of
such Assignments of Mortgage.
All Mortgage Loans not sold or transferred pursuant to an Agency Transfer,
Pass-Through Transfer or Whole Loan Transfer and any and all Mortgage Loans
repurchased by the Purchaser pursuant to Section 8.03 below with respect to an
Agency Transfer, Pass-Through Transfer or Whole Loan Transfer shall be subject
to this Agreement and shall continue to be serviced in accordance with the
terms of this Agreement and with respect thereto this Agreement shall remain
in full force and effect.
Section 8.02 Transfer of Servicing Following Reconstitution.
Following a Reconstitution of Mortgage Loans, the Purchaser or its
designee (which may include the Master Servicer, trustee, insurer, guarantor
or certificateholders) shall have the right, in its sole discretion, to cause
the Seller at any time under any Reconstitution Agreement to transfer the
servicing responsibilities and duties with respect to some or all of the
Mortgage Loans serviced thereunder to the Purchaser or any designee of the
Purchaser; provided, however, that the Purchaser shall provide the Seller with
30 days prior written notice and shall pay to the Seller a termination fee
identical to the "termination without cause fee" structure set forth in
Section 11.02, provided further that such transfer shall be subject to the
approval of
-56-
▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, as the case may be, with respect to Agency
Transfers, the trustee, Master Servicer or Rating Agencies with respect to
Pass-Through Transfers or any relevant third party purchaser with respect to
Whole Loan Transfers. No termination fee shall be paid or payable for any
Mortgage Loans with respect to which any payment is more than 90 days past due
as of the date of such termination. The Seller agrees to cooperate with the
Purchaser in such transfer of servicing responsibilities and shall comply with
the termination procedures set forth in Sections 10.01 and 12.01 hereof.
Section 8.03 Purchaser's Repurchase and Indemnification Obligations.
Upon receipt by the Seller of notice from ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac or other
such third party purchaser of a breach of any Purchaser representation or
warranty contained in any Reconstitution Agreement or a request by ▇▇▇▇▇▇ Mae,
▇▇▇▇▇▇▇ Mac, the trustee or such third party purchaser, as the case may be,
for the repurchase of any Mortgage Loan transferred to ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇
Mac pursuant to an Agency Transfer or to a trustee pursuant to a Pass-Through
Transfer or to a third party purchaser pursuant to a Whole Loan Transfer, the
Seller shall promptly notify the Purchaser of same and shall, at the direction
of the Purchaser, use its best efforts to cure and correct any such breach and
to satisfy the requests or concerns of ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, the trustee or
the third party purchaser related to such deficiencies of the related Mortgage
Loans transferred to ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, the trustee or other such third
party purchaser.
The Purchaser shall repurchase from the Seller any Mortgage Loan
transferred to ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac pursuant to an Agency Transfer or to
a trustee pursuant to a Pass-Through Transfer or to a third party purchaser
pursuant to a Whole Loan Transfer with respect to which the Seller has been
required by ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, the trustee or such third party purchaser
to repurchase due to a breach of a representation or warranty made by the
Purchaser with respect to the Mortgage Loans, or the servicing thereof prior
to the related Closing Date to ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, the trustee or any
third party purchaser in any Reconstitution Agreement and not due to a breach
of the Seller's obligations thereunder or pursuant to this Agreement. The
repurchase price to be paid by the Purchaser to the Seller shall equal that
repurchase price paid by the Seller to ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, or the third
party purchaser plus all reasonable costs and expenses borne by the Seller in
connection with the cure of said breach of a representation or warranty made
by the Purchaser and in connection with the repurchase of such Mortgage Loan
from ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, the trustee or the third party purchaser,
including, but not limited to, reasonable and necessary attorneys' fees.
At the time of repurchase, the Custodian and the Seller shall arrange for
the reassignment of the repurchased Mortgage Loan to the Purchaser according
to the Purchaser's instructions and the delivery to the Custodian of any
documents held by ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, the trustee or other relevant third
party purchaser with respect to the repurchased Mortgage Loan pursuant to the
related Reconstitution Agreement. In the event of a repurchase, the Seller
shall, simultaneously with such reassignment, give written notice to the
Purchaser that such repurchase has taken place, and amend the Mortgage Loan
Schedule to reflect the addition of the repurchased Mortgage Loan to this
Agreement. In connection with any such addition, the Seller and the Purchaser
shall be deemed to have made as to such repurchased Mortgage Loan the
representations and warranties set forth in this Agreement except that all
such representations
-57-
and warranties set forth in this Agreement shall be deemed made as of the date
of such repurchase.
Section 8.04 Additional Indemnification by the Seller.
The Seller shall indemnify the Purchaser and hold it harmless against any
and all claims, losses, damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs, judgments, and any other costs, fees
and expenses that the Purchaser may sustain in any way related to the failure
of the Seller to perform its duties and service the Mortgage Loans in strict
compliance with the terms of this Agreement or any Reconstitution Agreement
entered into pursuant to Section 8.01. The Seller shall immediately notify the
Purchaser if a claim is made by a third party with respect to this Agreement
or any Reconstitution Agreement or the Mortgage Loans, shall promptly notify
▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, the trustee or other relevant third party with
respect to any claim made by a third party with respect to any Reconstitution
Agreement, assume (with the prior written consent of the Purchaser) the
defense of any such claim and pay all expenses in connection therewith,
including counsel fees, promptly pay, discharge and satisfy any judgment or
decree which may be entered against it or the Purchaser in respect of such
claim and follow any written instructions received from the Purchaser in
connection with such claim. The Purchaser promptly shall reimburse the Seller
for all amounts advanced by it pursuant to the preceding sentence except when
the claim is in any way related to the failure of the Seller to service and
administer the Mortgage Loans in strict compliance with the terms of this
Agreement or any Reconstitution Agreement. In the event a dispute arises
between the Seller and the Purchaser with respect to any of the rights and
obligations of the parties pursuant to this Agreement, and such dispute is
adjudicated in a court of law, by an arbitration panel or any other judicial
process, then the losing party shall indemnify and reimburse the winning party
for all attorney's fees and other costs and expenses related to the
adjudication of said dispute.
Section 8.05 Transfer Of Servicing.
In the event that the Seller's duties, responsibilities and liabilities
under this Agreement should be terminated pursuant to the provisions of this
Agreement, the Seller shall discharge such duties and responsibilities during
the period from the date it acquires knowledge of such termination until the
effective date thereof with the same degree of diligence and prudence which it
is obligated to exercise under this Agreement, and shall take no action
whatsoever that might impair or prejudice the rights or financial condition of
its successor. The resignation or removal of the Seller pursuant to the
aforementioned sections shall not become effective until a successor shall be
appointed by the Purchaser. The Seller shall deliver promptly to the successor
Seller the funds in the Custodial Account and Escrow Account and all Servicing
Files and related documents and statements held by it hereunder and the Seller
shall account for all funds and shall execute and deliver such instruments and
do such other things as may reasonably be required to more fully and
definitively vest in the successor all such rights, powers, duties,
responsibilities, obligations and liabilities of the Seller.
-58-
ARTICLE IX
THE SELLER
Section 9.01 Merger or Consolidation of the Seller.
The Seller shall keep in full effect its existence, rights and franchises
as a corporation, and shall obtain and preserve its qualification to do
business as a foreign corporation in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Agreement or any of the Mortgage Loans and to perform
its duties under this Agreement.
Any person into which Seller may be merged or consolidated, or any
corporation resulting from any merger, conversion or consolidation to which
the Seller shall be a party, or any Person succeeding to the business of the
Seller, shall be the successor of the Seller hereunder, without the execution
or filing of any paper or any further act on the part of any of the parties
hereto, anything herein to the contrary notwithstanding, provided, however,
that the successor or surviving Person shall be an institution (i) having a
net worth of not less than $15,000,000, and (ii) which is a ▇▇▇▇▇▇ ▇▇▇- and
▇▇▇▇▇▇▇ Mac-approved servicer in good standing.
Section 9.02 Limitation on Liability of Seller and Others.
Neither the Seller nor any of the directors, officers, employees or agents
of the Seller shall be under any liability to the Purchaser for any action
taken or for refraining from the taking of any action in good faith pursuant
to this Agreement, or for errors in judgment, provided, however, that this
provision shall not protect the Seller or any such Person against any Breach
of warranties or representations made herein, or failure to perform its
obligations in strict compliance with any standard of care set forth in this
Agreement, or any liability which would otherwise be imposed by reason of any
breach of the terms and conditions of this Agreement. The Seller and any
director, officer, employee or agent of the Seller 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 Seller shall not be under
any obligation to appear in, prosecute or defend any legal action which is not
incidental to its duties to service the Mortgage Loans in accordance with this
Agreement and which in its opinion may involve it in any expense or liability,
provided, however, that the Seller may, with the consent of the Purchaser,
undertake any such action which it may deem necessary or desirable in respect
to this Agreement and the rights and duties of the parties hereto. In such
event, the Seller shall be entitled to reimbursement from the Purchaser of the
reasonable legal expenses and costs of such action.
Section 9.03 Limitation on Resignation and Assignment by Seller.
The Purchaser has entered into this Agreement with the Seller and
subsequent Purchasers will purchase the Mortgage Loans in reliance upon the
independent status of the Seller, and the representations as to the adequacy
of its servicing facilities, plant, personnel, records and procedures, its
integrity, reputation and financial standing, and the continuance thereof.
Therefore, the Seller shall neither assign this Agreement or the servicing
hereunder or
-59-
delegate its rights or duties hereunder or any portion hereof (to other than a
third party in the case of outsourcing routine tasks such as taxes, insurance,
mortgage release and property inspection, in which case the Seller shall be
fully liable for such tasks as if the Seller performed them itself) or sell or
otherwise dispose of all or substantially all of its property or assets
without the prior written consent of the Purchaser, which consent shall be
granted or withheld in the reasonable discretion of the Purchaser.
The Seller shall not resign from the obligations and duties hereby imposed
on it except by mutual consent of the Seller and the Purchaser or upon the
determination that its duties hereunder are no longer permissible under
applicable law and such incapacity cannot be cured by the Seller. Any such
determination permitting the resignation of the Seller shall be evidenced by
an Opinion of Counsel to such effect delivered to the Purchaser which Opinion
of Counsel shall be in form and substance acceptable to the Purchaser. No such
resignation shall become effective until a successor shall have assumed the
Seller's responsibilities and obligations hereunder in the manner provided in
Section 12.01.
Without in any way limiting the generality of this Section 9.03, in the
event that the Seller either shall assign this Agreement or the servicing
responsibilities hereunder or delegate its duties hereunder or any portion
thereof (to other than a third party in the case of outsourcing routine tasks
such as taxes, insurance, mortgage release and property inspection, in which
case the Seller shall be fully liable for such tasks as if the Seller
performed them itself) or sell or otherwise dispose of all or substantially
all of its property or assets, without the prior written consent of the
Purchaser, then the Purchaser shall have the right to terminate this Agreement
upon notice given as set forth in Section 10.01, without any payment of any
penalty or damages and without any liability whatsoever to the Seller or any
third party.
Section 9.04 Limitation on Assignment by the Seller.
This Agreement shall not be assigned, pledged or hypothecated by the
Seller to a third party without the prior written consent of the Purchaser,
which consent shall be granted or withheld in the sole discretion of the
Purchaser.
ARTICLE X
DEFAULT
Section 10.01 Events of Default.
Each of the following shall constitute an Event of Default on the part of
the Seller:
(a) any failure by the Seller to remit to the Purchaser any payment
required to be made under the terms of this Agreement which continues
unremedied for a period of one Business Day after the date upon which written
notice of such failure, requiring the same to be remedied, shall have been
given to the Seller by the Purchaser; or
-60-
(b) failure by the Seller duly to observe or perform in any material
respect any other of the covenants or agreements on the part of the Seller set
forth in this Agreement or in the Custodial Agreement which continues
unremedied for a period of 15 days after the date on which written notice of
such failure, requiring the same to be remedied, shall have been given to the
Seller by the Purchaser; or
(c) failure by the Seller to maintain its license to do business or
service residential mortgage loans in any jurisdiction where the Mortgaged
Property is located; or
(d) a decree or order of a court or agency or supervisory authority having
jurisdiction for the appointment of a conservator or receiver or liquidator in
any insolvency, readjustment of debt, including bankruptcy, marshaling of
assets and liabilities or similar proceedings, or for the winding-up or
liquidation of its affairs, shall have been entered against the Seller and
such decree or order shall have remained in force undischarged or unstayed for
a period of 60 days; or
(e) the Seller shall consent to the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt, marshaling of
assets and liabilities or similar proceedings of or relating to the Seller or
of or relating to all or substantially all of its property; or
(f) the Seller shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take advantage of any
applicable insolvency, bankruptcy or reorganization statute, make an
assignment for the benefit of its creditors, voluntarily suspend payment of
its obligations or cease its normal business operations for three Business
Days; or
(g) the Seller ceases to meet the qualifications of a ▇▇▇▇▇▇ ▇▇▇ or
▇▇▇▇▇▇▇ Mac servicer; or
(h) the Seller fails to maintain a minimum net worth of $15,000,000; or
(i) the Seller attempts to assign its right to servicing compensation
hereunder or attempts without the consent of the Purchaser to assign this
Agreement or the servicing responsibilities hereunder or to delegate its
duties hereunder or any portion thereof (to other than a third party in the
case of outsourcing routine tasks such as taxes, insurance, mortgage release
and property inspection, in which case the Seller shall be fully liable for
such tasks as if the Seller performed them itself) in violation of Section
9.04; or
(j) if (x) after a Reconstitution in a Pass-Through Transfer, any of the
Rating Agencies reduces or withdraws the rating of any of the certificates
issued by a securitization trust that owns the Mortgage Loans due to a reason
attributable to the Seller or (y) the Seller's residential primary servicer
rating for servicing of mortgage loans of the same type as the Mortgage Loans
issued by any of the Rating Agencies is reduced below its rating in effect on
the related Closing Date or withdrawn; or
(k) the Seller attempts, without the consent of the Purchaser, to sell or
otherwise dispose of all or substantially all of its property or assets.
-61-
In each and every such case, so long as an Event of Default shall not have
been remedied, in addition to whatsoever rights the Purchaser may have at law
or equity to damages, including injunctive relief and specific performance,
the Purchaser, by notice in writing to the Seller, (i) may terminate all the
rights and obligations of the Seller under this Agreement and in and to the
Mortgage Loans and the proceeds thereof, and (ii) may terminate any commitment
the Purchaser has entered into to purchase additional Mortgage Loans from the
Seller hereunder.
Upon receipt by the Seller of such written notice, all authority and power
of the Seller under this Agreement, whether with respect to the Mortgage Loans
or otherwise, shall pass to and be vested in the successor appointed pursuant
to Section 12.01. Upon written request from any Purchaser, the Seller shall
prepare, execute and deliver to the successor entity designated by the
Purchaser any and all documents and other instruments, place in such
successor's possession all Mortgage Files, and do or cause to be done all
other acts or things necessary or appropriate to effect the purposes of such
notice of termination, including but not limited to the transfer and
endorsement or assignment of the Mortgage Loans and related documents, at the
Seller's sole expense. The Seller shall cooperate with the Purchaser and such
successor in effecting the termination of the Seller's responsibilities and
rights hereunder, including without limitation, the transfer to such successor
for administration by it of all cash amounts which shall at the time be
credited by the Seller to the Custodial Account or Escrow Account or
thereafter received with respect to the Mortgage Loans.
Section 10.02 Waiver of Defaults.
By a written notice, the Purchaser may waive any default by the Seller in
the performance of its obligations hereunder and its consequences. Upon any
waiver of a past default, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been remedied for every
purpose of this Agreement. No such waiver shall extend to any subsequent or
other default or impair any right consequent thereon except to the extent
expressly so waived.
ARTICLE XI
TERMINATION
Section 11.01 Termination.
This Agreement shall terminate upon either: (i) the later of the final
payment or other liquidation (or any advance with respect thereto) of the last
Mortgage Loan or the disposition of any REO Property with respect to the last
Mortgage Loan and the remittance of all funds due hereunder; or (ii) mutual
consent of the Seller and the Purchaser in writing.
Section 11.02 Termination Without Cause.
This Agreement and the Seller's rights hereunder with respect to some or
all of the Mortgage Loans shall terminate upon: (i) the later of (a) the
distribution of the final payment or liquidation proceeds on the last Mortgage
Loan to the Purchaser (or advances by the Seller for the same), and (b) the
disposition of all REO Property acquired upon foreclosure of the last
-62-
Mortgage Loan and the remittance of all funds due hereunder, or (ii) mutual
consent of the Seller and the Purchaser in writing or (iii) at the sole option
of the Purchaser, without cause, upon 30 days written notice, subject to the
limitations set forth below. Any such notice of termination shall be in
writing and delivered to the Seller by registered mail to the address set
forth at the beginning of this Agreement. The Purchaser and the Seller shall
comply with the termination procedures set forth in Sections 10.01 and 12.01
hereof.
In the event the Purchaser terminates the Seller without cause with
respect to some or all of the Mortgage Loans, the Purchaser shall be required
to pay to the Seller a termination fee equal to 1.0% of the aggregate unpaid
principal balance of the Mortgage Loans as of such termination date.;
provided, that no termination fee shall be paid or payable with respect to the
unpaid principal balance of any terminated Mortgage Loan with respect to which
any payment is more than 90 days delinquent as of the date of such
termination.
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01 Successor to Seller.
Prior to termination of the Seller's responsibilities and duties under
this Agreement pursuant to Sections 8.05, 10.01, 11.01 (ii) or pursuant to
Section 11.02 after the 30 day period has expired, the Purchaser shall, (i)
succeed to and assume all of the Seller's responsibilities, rights, duties and
obligations under this Agreement, or (ii) appoint a successor which shall
succeed to all rights and assume all of the responsibilities, duties and
liabilities of the Seller under this Agreement simultaneously with the
termination of Seller's responsibilities, duties and liabilities under this
Agreement. In connection with such appointment and assumption, the Purchaser
may make such arrangements for the compensation of such successor out of
payments on Mortgage Loans as it and such successor shall agree. In the event
that the Seller's duties, responsibilities and liabilities under this
Agreement should be terminated pursuant to the aforementioned sections, the
Seller shall discharge such duties and responsibilities during the period from
the date it acquires knowledge of such termination until the effective date
thereof with the same degree of diligence and prudence which it is obligated
to exercise under this Agreement, and shall take no action whatsoever that
might impair or prejudice the rights or financial condition of its successor.
The resignation or removal of the Seller pursuant to the aforementioned
sections shall not become effective until a successor shall be appointed
pursuant to this Section 12.01 and shall in no event relieve the Seller of the
representations and warranties made pursuant to Section 4.01 or Section 4.02
and the remedies available to the Purchaser under Section 4.03, it being
understood and agreed that the provisions of such Sections 4.01, 4.02 and 4.03
shall be applicable notwithstanding any such sale, assignment, resignation or
termination of the Seller, or the termination of this Agreement.
Within 30 days of the appointment of a successor entity by the Purchaser,
the Seller shall prepare, execute and deliver to the successor entity any and
all documents and other instruments, place in such successor's possession all
Servicing Files, and do or cause to be done all other acts or things necessary
or appropriate to effect the purposes of such notice of termination, including
but not limited to the transfer of the Mortgage Notes and related
-63-
documents. The Seller shall cooperate with the Purchaser and such successor in
effecting the termination of the Seller's responsibilities and rights
hereunder and the transfer of servicing responsibilities to the successor
Seller, including without limitation, the transfer to such successor for
administration by it of all cash amounts which shall at the time be credited
by the Seller to the Custodial Account or Escrow Account or thereafter
received with respect to the Mortgage Loans.
Any successor appointed as provided herein shall execute, acknowledge and
deliver to the Seller and to the Purchaser an instrument accepting such
appointment, wherein the successor shall make the representations and
warranties set forth in Section 4.01, whereupon such successor shall become
fully vested with all the rights, powers, duties, responsibilities,
obligations and liabilities of the Seller, with like effect as if originally
named as a party to this Agreement. Any termination or resignation of the
Seller or termination of this Agreement pursuant to Section 8.05, 10.01, 11.01
or 11.02 shall not affect any claims that any Purchaser may have against the
Seller arising out of the Seller's actions or failure to act prior to any such
termination or resignation.
The Seller shall deliver promptly to the successor servicer the funds in
the Custodial Account and Escrow Account and all Mortgage Files and related
documents and statements held by it hereunder and the Seller shall account for
all funds and shall execute and deliver such instruments and do such other
things as may reasonably be required to more fully and definitively vest in
the successor all such rights, powers, duties, responsibilities, obligations
and liabilities of the Seller.
Upon a successor's acceptance of appointment as such, the Seller shall
notify by mail the Purchaser of such appointment in accordance with the
procedures set forth in Section 12.08.
Section 12.02 Amendment.
This Agreement may be amended from time to time by the Seller and the
Purchaser by written agreement signed by the Seller and the Purchaser,
provided, however, that the servicing provisions of this Agreement may be
amended by the Seller, as servicer and the Purchaser by written agreement
signed only by the Seller, as servicer and the Purchaser.
Section 12.03 Closing.
Each closing for the purchase and sale of Mortgage Loans hereunder shall
take place on the related Closing Date. At the Purchaser's option, the closing
shall be either: by telephone, confirmed by letter or wire as the parties
shall agree; or conducted in person, at such place as the parties shall agree.
Each closing for a Mortgage Loan Package shall be subject to each of the
following conditions:
(a) No later than the date set forth in the related Purchase Price and
Terms Agreement, the Seller shall deliver to the Purchaser a Mortgage Loan
Schedule with respect to the Mortgage Loans to be purchased and sold on such
date;
-64-
(b) all of the representations and warranties of the Seller under this
Agreement shall be true and correct as of the related Closing Date and no
event shall have occurred which, with notice or the passage of time, would
constitute a default under this Agreement;
(c) the Purchaser shall have received, or the Purchaser's attorneys shall
have received in escrow, all closing documents as specified in Section 12.04
of this Agreement, in such forms as are agreed upon and acceptable to the
Purchaser, duly executed by all signatories other than the Purchaser as
required pursuant to the respective terms thereof;
(d) The Seller shall have delivered and released to the Custodian on or
prior to the related Closing Date all documents required pursuant to the
Custodial Agreement; and
(e) The Seller shall not have experienced any Material Adverse Change. For
the purposes of this Section, "Material Adverse Change" shall mean, (i) a
material adverse change in, or a material adverse effect upon, the operations,
business, properties, condition (financial or otherwise) or prospects of the
Seller; (ii) a material impairment of the ability of the Seller, to perform
under this Agreement or any related agreements (the "Operative Agreements");
or (iii) a material adverse effect upon the legality, validity, binding effect
or enforceability of any Operative Agreement against the Seller; and
(f) all other terms and conditions of this Agreement and the related
Purchase Price and Terms Agreement shall have been complied with.
Subject to the foregoing conditions, the Purchaser shall pay to the Seller
on the related Closing Date the Purchase Price, plus accrued interest pursuant
to Article III of this Agreement, plus the costs specified in Section 12.05 or
in the related Purchase Price and Terms Agreement by wire transfer of
immediately available funds to the account designated by the Seller.
Section 12.04 Closing Documents.
(a) The closing documents to be delivered on the initial Closing Date
shall consist of fully executed originals of the following documents, as well
as the documents referred to in Section 12.04(b):
(i) this Agreement;
(ii) a Custodial Account Letter Agreement or a Custodial Account
Certification, as applicable, in the form of Exhibit D-1 or Exhibit D-2
hereto, as applicable;
(iii) an Escrow Account Letter Agreement or an Escrow Account
Certification, as applicable, in the form of Exhibit E-1 or Exhibit E-2
hereto, as applicable;
(iv) an Officer's Certificate, in the form of Exhibit H hereto, including
all attachments thereto; and
(v) an Opinion of Counsel of the Seller, in the form of Exhibit I hereto.
-65-
(b) The closing documents for the Mortgage Loans to be purchased on each
Closing Date under this Agreement (including the initial Closing Date) shall
consist of fully executed originals of the following documents:
(c) the related Purchase Price and Terms Agreement;
(d) the related Acknowledgment and Conveyance Agreement, including all
annexes thereto;
(e) each of the documents required to be delivered by the Seller pursuant
to Section 2.03 hereof;
(f) an assignment and assumption of the Custodial Agreement;
(g) an initial certification of the Custodian;
(h) (A) a Security Release Certification, in the form of Exhibit J-1
hereto (if Seller is a member of the Federal Home Loan Bank System), executed
by the applicable regional Federal Home Loan Bank and, (B) if applicable, a
Security Release Certification, in the form of Exhibit J-2 hereto, executed by
any other person, as requested by the Purchaser, if any of the Mortgage Loans
have at any time been subject to any security interest, pledge or
hypothecation for the benefit of such person and (C) if applicable, a
certificate of the Seller and an opinion of counsel of the Seller stating that
the Mortgage Loans are not subject to any security interest, claim, pledge,
hypothecation or lien;
(i) a Certificate or other evidence of merger or change of name, signed or
stamped by the applicable regulatory authority, if any of the Mortgage Loans
were acquired by the Seller by merger or acquired or originated by the Seller
while conducting business under a name other than its present name;
(j) upon request by the Purchaser, an Officer's Certificate, in the form
of Exhibit H hereto, including all attachments thereto; and
(k) upon request by the Purchaser, an Opinion of Counsel to the Seller, in
the form of Exhibit I hereto.
The Seller shall bear the risk of loss of the Closing Documents until such
time as they are received by the Purchaser or its attorneys.
Section 12.05 Costs.
The Purchaser shall pay any commissions due its salesmen and the legal
fees and expenses of its attorneys. All other costs and expenses incurred in
connection with the transfer and delivery of the Mortgage Loans, including
fees for the preparation and tracking of Assignments of Mortgage, fees for
title policy endorsements and continuations and the Seller's attorney's fees,
shall be paid by the Seller. On the related Closing Date, the Seller shall pay
to the Purchaser a fee of $30.00 per Mortgage Loan with respect to Mortgage
Loans which are not MERS Mortgage Loans for the initial recordation of the
Assignments of Mortgage (the
-66-
"Assignment Fees"), which Assignment Fees shall be deducted from the actual
Purchase Price proceeds paid to the Seller on the such Closing Date. The
Seller shall pay any fees for the set up of all tax service contracts or flood
insurance contracts for the Mortgage Loans and the Seller shall be responsible
for the payment of any costs associated with the transfer of the tax service
contracts or flood insurance contracts to a subsequent servicer in the event
that the Seller may be terminated as servicer under this Agreement pursuant to
Section 10.01.
Section 12.06 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 12.07 Duration of Agreement.
This Agreement shall continue in existence and effect until terminated as
herein provided. This Agreement shall continue notwithstanding transfers of
the Mortgage Loans by the Purchaser.
Section 12.08 Notices.
All demands, notices and communications hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered at or mailed
by registered mail, postage prepaid, addressed as follows:
(i) if to the Seller:
Greenpoint Mortgage Funding Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇
(ii) if to Purchaser:
▇▇▇▇▇▇ Brothers Bank, FSB
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Contract Finance
Section 12.09 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be held invalid for any reason whatsoever, then such
covenants, agreements, 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.
-67-
Section 12.10 Relationship of Parties.
Nothing herein contained shall be deemed or construed to create a
partnership or joint venture between the parties hereto and the services of
the Seller shall be rendered as an independent contractor and not as agent for
the Purchaser.
Section 12.11 Execution; Successors and Assigns.
This Agreement may be executed in one or more counterparts and by the
different parties hereto on separate counterparts, each of which, when so
executed, shall be deemed to be an original; such counterparts, together,
shall constitute one and the same agreement. This Agreement shall inure to the
benefit of and be binding upon the Seller and the Purchaser and their
respective successors and assigns.
Section 12.12 Recordation of Assignments of Mortgage.
The Assignments of Mortgage are generally required to be recorded by or on
behalf of the Seller in the appropriate offices for real property records;
provided however, the Seller shall not cause to be recorded any Assignment
which relates to a Mortgage Loan in a jurisdiction where either the rating
agencies (in the case of Agency or Pass-Through Transfers) or purchasers (in
the case of Whole Loan Transfers) do not require recordation; provided
further, however, notwithstanding the foregoing, upon the occurrence of
certain events set forth in the pooling agreement (in the case of and Agency
or Pass-Through Transfer), each such assignment of Mortgage shall be recorded
by the Master Servicer or the trustee as set forth in the pooling agreement.
Any costs associated with the recording of the initial Assignments of Mortgage
and other relevant documents will be borne by the Seller, provided, however,
if the Seller fails to pay the cost of recording or with respect to additional
Assignments of Mortgage, such expense will be paid by the Master Servicer or
the trustee, as applicable, and will be reimbursable to such party (other than
the Master Servicer so long as the Master Servicer is also the Seller) by the
applicable trust prior to any distribution to certificateholders. In the event
that Purchaser sells any Mortgage Loans in a Whole Loan Transfer and the
subsequent purchaser requests recorded Assignments of Mortgage, the Seller,
shall at its expense cause to be recorded any Assignments of Mortgage.
-68-
Section 12.13 Assignment by Purchaser.
The Purchaser shall have the right, without the consent of the Seller, to
assign, in whole or in part, its interest under this Agreement with respect to
some or all of the Mortgage Loans, and designate any person to exercise any
rights of the Purchaser hereunder, by executing an Assignment and Assumption
Agreement substantially in the form of Exhibit G hereto. Upon such assignment
of rights and assumption of obligations, the assignee or designee shall accede
to the rights and obligations hereunder of the Purchaser with respect to such
Mortgage Loans and the Purchaser as assignor shall be released from all
obligations hereunder with respect to such Mortgage Loans from and after the
date of such Assignment and Assumption. All references to the Purchaser in
this Agreement shall be deemed to include its assignee or designee.
Section 12.14 No Personal Solicitation.
From and after the Closing Date, the Seller hereby agrees that it will not
take any action or permit or cause any action to be taken by any of their
agents or affiliates, or by any independent contractors on the Seller's
behalf, to personally, by telephone, mail, e-mail or the Internet, solicit the
borrower or obligor under any Mortgage Loan for any purpose whatsoever,
including to refinance a Mortgage Loan, in whole or in part, without the prior
written consent of the Purchaser. It is understood and agreed that all rights
and benefits relating to the solicitation of any Mortgagors and the attendant
rights, title and interest in and to the list of such Mortgagors and data
relating to their Mortgages (including insurance renewal dates) shall be
transferred to the Purchaser pursuant hereto on Closing Date and the Seller
shall not take any action to undermine these rights and benefits.
Notwithstanding the foregoing, it is understood and agreed that offers to
refinance a Mortgage Loan made within 30 days following receipt by the Seller
of a pay-off request from the Mortgagor and promotions undertaken by the
Seller or any affiliate of the Seller which are directed to the general public
at large, including, without limitation, mass mailing based on commercially
acquired mailing lists, newspaper, radio and television advertisements shall
not constitute solicitation under this Section 12.14. The provisions of this
Section 12.14 shall survive any termination of this Agreement.
Section 12.15 Confidential Information
The Seller hereby acknowledges that the Purchaser is subject to the
privacy regulations under Title V of the ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act, 15 U.S.C. ss.
6801 et seq., pursuant to which regulations the Purchaser is required to
obtain certain undertakings from the Seller with regard to the privacy, use
and protection of nonpublic personal financial information of the Mortgagors.
Therefore, notwithstanding anything to the contrary contained in this
Agreement, the Seller agrees that (a) it shall not disclose or use any
personally identifiable information relating to a mortgagor (as defined below,
"Customer Information") except to the extent necessary to carry out its
obligations under this Agreement and for no other purpose, (b) it shall not
disclose Customer Information to any third party, including, without
limitation, its third party service providers without the prior consent of the
Purchaser and an agreement in writing from the third party to use or disclose
such Customer Information only to the extent necessary to carry out the
Seller's obligations under this Agreement and for no other purposes, (c) it
shall maintain, and shall require all third parties approved under subsection
(b) to maintain, effective information security measures to protect Customer
Information from unauthorized disclosure or
-69-
use, and (d) it shall provide the Purchaser with information regarding such
security measures upon the reasonable request of the Purchaser and promptly
provide the Purchaser with information regarding any failure of such security
measures or any security breach related to Customer Information. The
obligations set forth in this Section shall survive termination of the
Agreement. For the purposes of this Agreement, "Customer Information" means
the nonpublic personal information (as defined in 15 U.S.C. ss. 6809(4)) of
the Purchaser's employees, clients or prospective clients, including the
Mortgagors (and/or clients or prospective clients of the Purchaser's parent,
affiliated or subsidiary companies) received by the Seller in connection with
the performance of its obligations under the Agreement, including, but not
limited to (i) an individual's name, address, e-mail address, IP address,
telephone number and/or social security number, (ii) the fact that an
individual has a relationship with the Purchaser and/or its parent, affiliated
or subsidiary companies, or (iii) an individual's account information to the
extent Nonpublic Personal Information (as defined) is, either intentionally or
unintentionally, disclosed to or obtained by the Seller during the Agreement.
The Seller covenants to keep such Nonpublic Personal Information strictly
confidential and to strictly limit its use of such information to carrying out
the services set forth herein. For the purposes of this provision, the term
"Nonpublic Personal Information" is defined as any non-public personally
identifiable financial information of an individual, including but not limited
to the Mortgagors or the Purchaser's clients or employees.
-70-
Section 12.16 Appointment and Designation of Master Servicer.
The Purchaser may, in its sole discretion from time to time, engage a
master servicer (the "Master Servicer") to assist the Purchaser in the
supervision of the performance by the Seller of its obligations and
responsibilities arising under this Agreement. In the event that the Purchaser
so appoints a Master Servicer, the Purchaser shall provide written notice
thereof to the Seller. From the date of such notice until such time as the
Seller receives written notice from the Purchaser that it has terminated or
replaced such Master Servicer, the Seller shall deliver all notices, reports
and remittances that the Seller is obligated to deliver to the Purchaser under
this Agreement directly to the Master Servicer named in such notice (or to any
successor master servicer named in any subsequent written notice received from
the Purchaser). The Master Servicer, acting on behalf of the Purchaser, shall
have the benefit of the covenants and agreements of the Seller under this
Agreement and the Master Servicer, acting on behalf of the Purchaser, shall
have the same rights as the Purchaser to the to enforce the obligations of the
Seller arising under this Agreement. The Master Servicer shall be entitled to
terminate the rights and obligations of the Seller under this Agreement upon
the occurrence of an Event of Default as provided in this Agreement.
Notwithstanding anything herein to the contrary, in no event shall the Master
Servicer assume any of the obligations of the Purchaser under this Agreement;
and in connection with the performance of the Master Servicer's duties
hereunder the Seller agrees that the Master Servicer shall be entitled to all
of the rights, protections, indemnities and limitations of liability afforded
to the Purchaser under this Agreement. The Purchaser hereby appoints Aurora
Loan Services Inc. as its Master Servicer hereunder.
Section 12.17 Waivers; Other Agreements.
No term or provision of this Agreement may be waived or modified unless
such waiver or modification is in writing and signed by the party against whom
such waiver or modification is sought to be enforced.
Section 12.18 Exhibits.
The exhibits to this Agreement are hereby incorporated and made a part
hereof and are an integral part of this Agreement.
Section 12.19 General Interpretive Principles.
For purposes of this Agreement, except as otherwise expressly provided or
unless the context otherwise requires:
(a) the terms defined in this Agreement have the meanings assigned to them
in this Agreement and include the plural as well as the singular, and the use
of any gender herein shall be deemed to include the other gender;
(b) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;
-71-
(c) references herein to "Articles", "Sections", "Subsections",
"Paragraphs", and other subdivisions without reference to a document are to
designated Articles, Sections, Subsections, Paragraphs and other subdivisions
of this Agreement;
(d) a reference to a Subsection without further reference to a Section is
a reference to such Subsection as contained in the same Section in which the
reference appears, and this rule shall also apply to Paragraphs and other
subdivisions;
(e) the words "herein", "hereof", "hereunder" and other words of similar
import refer to this Agreement as a whole and not to any particular provision;
and
(f) the term "include" or "including" shall mean without limitation by
reason of enumeration.
-72-
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their names
to be signed hereto by their respective officers thereunto duly authorized as
of the day and year first above written.
▇▇▇▇▇▇ BROTHERS BANK, FSB,
Purchaser
By:______________________________________
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
GREENPOINT MORTGAGE FUNDING INC.,
Seller
By:______________________________________
Name:____________________________________
Title:___________________________________
-▇▇-
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ )
) ss.:
COUNTY OF NEW YORK )
On the __ day of ________, 2003 before me, a Notary Public in and for said
State, personally appeared ________, known to me to be Vice President of
▇▇▇▇▇▇ Brothers Bank, FSB, the corporation that executed the within instrument
and also known to me to be the person who executed it on behalf of said
corporation, and acknowledged to me that such corporation executed the within
instrument.
IN WITNESS WHEREOF, I have hereunto set my hand affixed my office seal the
day and year in this certificate first above written.
Notary Public ____________________________
My Commission expires ____________________
-74-
STATE OF )
) ss.:
COUNTY OF )
On the __ day of _______, 2003 before me, a Notary Public in and for said
State, personally appeared __________, known to me to be ______________ of
__________________, the corporation that executed the within instrument and
also known to me to be the person who executed it on behalf of said
corporation, and acknowledged to me that such corporation executed the within
instrument.
IN WITNESS WHEREOF, I have hereunto set my hand affixed my office seal the
day and year in this certificate first above written.
Notary Public ____________________________
My Commission expires ____________________
-75-
EXHIBIT A-1
FORM OF ACKNOWLEDGMENT AND CONVEYANCE AGREEMENT
(Group No. 200_-____)
This is an Acknowledgment and Conveyance Agreement delivered pursuant to
that certain Flow Mortgage Loan, Purchase, Warranties and Servicing Agreement,
dated as of August 1, 2003 (the "Agreement"), between ▇▇▇▇▇▇ BROTHERS BANK,
FSB (the "Purchaser"), and GREENPOINT MORTGAGE FUNDING INC. (the "Seller").
All capitalized terms used herein without definition shall have the meanings
ascribed thereto in the Agreement.
The Purchaser and the Seller hereby confirm that they have reached
agreement on the purchase, sale and servicing of the Mortgage Loans described
on the Mortgage Loan Schedule attached as Annex 1 hereto on the terms and
conditions set forth in the Purchase Agreement (which terms and conditions are
incorporated herein by this reference) and the Purchase Price and Terms
Agreement, dated as of ___________ __, 200_ between the parties hereto.
Accordingly, on this [___ day of _________, 200_], the Seller does hereby
sell, transfer, assign, set over and convey to the Purchaser all right, title
and interest of the Seller in and to the Mortgage Loans listed on the Mortgage
Loan Schedule attached as Annex 1 hereto, including all interest and principal
received by the Seller on or with respect to the Mortgage Loans after the
related Cut-off Date, together with all of the Seller's right, title and
interest in and to each Custodial Account and all amounts from time to time
credited to and the proceeds of such Custodial Account, all amounts from time
to time credited to and the proceeds of any Escrow Account, any Liquidation
Proceeds or Condemnation Proceeds, any REO Disposition Proceeds, the Seller's
rights under any insurance policies related to the Mortgage Loans, the Policy
related to each Mortgage Loan and all rights of the Seller thereunder, any
Insurance Proceeds, the Seller's security interest in any collateral pledged
to secure the Mortgage Loans, including the Mortgaged Properties, and any
proceeds of the foregoing. Pursuant to Article II of the Agreement, the Seller
has delivered to the Custodian the documents for each Mortgage Loan to be
purchased as set forth in the Agreement. The ownership of each Mortgage Note,
Mortgage, and the contents of each Mortgage File is vested in the Purchaser
and the ownership of all records and documents with respect to the related
Mortgage Loan prepared by or which come into the possession of the Seller
shall immediately vest in the Purchaser.
By its execution and delivery of this Acknowledgment and Conveyance
Agreement, the Seller represent and warrant to the Purchaser that each of the
representations and warranties contained in Sections 4.01 and 4.02 of the
Agreement and Annex 2 hereto is true and correct as of the date hereof with
respect to the Seller and each of the Mortgage Loans listed on the Mortgage
Loan Schedule attached as Annex 1 hereto. In addition, the Seller represents
and warrants to the Purchaser that the Underwriting Guidelines set forth on
Annex 3 hereto are the Underwriting Guidelines used by the Seller with respect
to the origination of the Mortgage Loans in this Mortgage Loan Package.
Exh. A-1-1
By its execution and delivery of this Acknowledgment and Conveyance
Agreement, the Seller agrees that it shall service the Mortgage Loans on
behalf of the Purchaser in accordance with the terms and conditions contained
in the Agreement.
This Acknowledgment and Conveyance Agreement may be executed
simultaneously in any number of counterparts. Each counterpart shall be deemed
an original, and all such counterparts shall constitute one and the same
instrument.
GREENPOINT MORTGAGE FUNDING INC., as Seller
By: ______________________________________
Name:
Title:
▇▇▇▇▇▇ BROTHERS BANK, FSB, as Purchaser
By: __________________________________
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
Exh. A-1-2
Annex 1 to
Acknowledgment and Conveyance Agreement
MORTGAGE LOAN SCHEDULE
[Each Mortgage Loan Schedule shall provide the information required by Exhibit
A-2 to the Agreement with respect to each Mortgage Loan as of the related Cut-
Off Date.]
[Intentionally Omitted]
Exh. A-1-3
Annex 2 to
Acknowledgment and Conveyance Agreement
POOL CHARACTERISTICS
The Seller hereby represents and warrants to the Purchaser, as to each
Mortgage Loan, that as of [DATE] or as of such other date specifically
provided therein:
Pool Characteristics. ["Pool 1 Mortgage Loans" are the group of _________
Mortgage Loans set forth on the Mortgage Loan Schedule, "Pool 2 Mortgage
Loans" are the group of _________ Mortgage Loans set forth on the Mortgage
Loan Schedule.] With respect to the aggregate unpaid principal balance of all
of the Mortgage Loans as of the Closing Date, (a) the Mortgage Loans are
secured by real property improved by one- to four- family dwellings with
original terms of up to [___] years, (b) with respect to each ARM Mortgage
Loan the Index shall be as set forth on the Mortgage Loan Schedule, (c) the
maximum Mortgage Interest Rate of the Mortgage Loans is [___]%, (d) the
minimum Mortgage Interest Rate of the Mortgage Loans is [___]%, (e) the
Mortgage Loans have a weighted average remaining term of [___] months, (f)
each of the Mortgaged Properties consists of a single parcel of real property
of which (i) at least [___]% are attached or detached one family residences,
(ii) approximately [___]% are individual condominium units in a condominium
project, (iii) approximately [___]% are units in planned unit developments,
(iv) approximately [___]% are two-to-four family residential dwellings, (v)
not more than [___]% are townhouses and (vi) not more than [___]% are
manufactured housing which are permanently affixed to the ground, (g) no more
than [___]% of the Mortgage Loans are rate-term refinance mortgage loans, (h)
no more than [___]% of the Mortgage Loans are cash out refinance mortgage
loans, (i) at least [___]% of the Mortgage Loans are purchase money mortgage
loans, (j) the Mortgaged Properties are located as follows (i) approximately
[___]% in [___], (ii) approximately [___]% in [___] and (iii) no other state
shall contain a percentage which is greater than [___]% and (k) with respect
to the ARM Mortgage Loans, the weighted average initial period gross Lifetime
Rate Cap shall be [___]% and the weighted average lifetime Mortgage Interest
Rate of [___]%. With respect to the aggregate unpaid principal balance of the
Mortgage Loans at the time of origination, (a) no more than [___]% of the
Mortgaged Properties were investment properties and (b) at least [___]% of the
Mortgaged Properties were owner-occupied primary residences. With respect to
the aggregate unpaid principal balance of the Mortgage Loans, (a) at least
[___]% of the Mortgage Loans shall have full documentation, (b) no more than
[___]% of the Mortgage Loans shall have stated income documentation and (c) no
more than [___]% of the Mortgage Loans shall have alternate income
documentation. The maximum LTV at origination of the Mortgage Loans in Pool 1
was not more than [___]% and the maximum LTV at origination of the Mortgage
Loans in Pool 2 was not more than [___]%. The weighted average LTV at
origination of the Mortgage Loans in Pool 1 was not more than [___]% and the
weighted average LTV at origination of the Mortgage Loans in Pool 2 was not
more than [___]%. The weighted average FICO Score of the Mortgage Loans in
Pool 1 is not less than [___] and the weighted average FICO Score of the
Mortgage Loans in Pool 2 is not less than [__]. Of the Mortgage Loans in Pool
1, [___]% have a credit grade of [___], [___]% have a credit grade of [___],
[___]% have a credit grade of [___], [__]% have a credit grade of [___]and
[___]% have a credit grade of [___]. Of the Mortgage Loans in Pool 2, [___]%
have a credit grade of [___], [___]% have a credit grade of [___], [___]% have
a credit grade of [___], [___]% have a credit grade of [___]and [___]% have a
credit grade of [___]. The credit grades of the
Exh. A-1-4
Mortgage Loans were determined in accordance with the Underwriting Guidelines
attached as Annex 3 hereto. The Mortgage Loans have the approximate pool
characteristics as set forth in the Purchase Price and Terms Letter.
Exh. A-1-5
Annex 3 to
Acknowledgment and Conveyance Agreement
SELLER'S UNDERWRITING GUIDELINES
[Intentionally Omitted]
Exh. A-1-6
EXHIBIT A-2
MORTGAGE LOAN SCHEDULE DATA FIELDS
(1) the Seller's Mortgage Loan identifying number;
(2) the Mortgagor's and Co-Mortgagor's (if applicable) names;
(3) the street address of the Mortgaged Property, including the city,
state, zip code, lot number, block number and section number;
(4) a code indicating whether the Mortgaged Property is a single family
residence, a 2 family dwelling, a 3-4 family dwelling, a manufactured
home, a PUD, a townhouse, a unit in a condominium, a co-operative, a
mixed use property, land, or a non-residential property;
(5) the original months to maturity or the remaining months to maturity
from the Cut-off Date, in any case based on the original amortization
schedule, and if different, the maturity expressed in the same manner
but based on the actual amortization schedule;
(6) the Loan to Value Ratio at origination;
(7) the combined Loan to Value Ratio at origination;
(8) the Mortgage Interest Rate as of the Cut-off Date;
(9) the date on which the first payment is due;
(10) the stated maturity date;
(11) the amount of the Monthly Payment;
(12) the next due date as of the Cut-off Date;
(13) the original principal amount of the Mortgage Loan;
(14) the principal balance of the Mortgage Loan as of the close of business
on the Cut-off Date; after deduction of payments of principal actually
received on or before the Cut-off Date;
(15) the loan purpose code;
(16) the occupancy code;
Exh. A-2-1
(17) the loan documentation code to be provided in conformance with Standard
and Poor's documentation categories- Field 5);
(18) the debt to income ratio; and
(19) the Mortgagor's and Co-Mortgagor's (if applicable) social security
numbers;
(20) the Mortgagor's and Co-Mortgagor's (if applicable) FICO score,
(21) the original FICO score, and the Next Generation FICO Score for new
credit scores;
(22) the date of the FICO score;
(23) the Mortgagor's mailing address if different from Number (3) above;
(24) the Mortgagor's home telephone number;
(25) the credit grade of the Mortgage Loan;
(26) the Mortgagor's business telephone number;
(27) the purchase price of the Mortgaged Property (if a purchase);
(28) the Appraisal value of the Mortgaged Property;
(29) the Mortgagor's and Co-Mortgagor's (if applicable) race;
(30) the Mortgagor's and Co-Mortgagor's (if applicable) gender;
(31) the Mortgagor's and Co-Mortgagor's (if applicable) date of birth;
(32) the number of bedrooms;
(33) rental income per unit;
(34) the combined annual income;
(35) the application date;
(36) the broker's name;
(37) the broker's firm name;
(38) the appraiser's name;
(39) the appraiser's firm name;
Exh. A-2-2
(40) the settlement agent;
(41) the origination channel (wholesale, retail);
(42) flood insurance provider;
(43) tax service provider;
(44) number of units;
(45) as of date;
(46) amortization term;
(47) balloon flag;
(48) prepayment penalty flag;
(49) prepayment penalty term;
(50) payment history current loan;
(51) payment history previous loan all refinanced loans;
(52) mortgage insurance provider;
(53) mortgage insurance coverage percentage;
(54) mortgage insurance cost;
(55) mortgage insurance certificate number;
(56) number of borrowers;
(57) first time home buyer flag;
(58) year home was built;
(59) the monthly tax and insurance payment;
(60) the escrow balance as of the cut-off date;
(61) The MIN number assigned to each Mortgage Loan;
(62) monthly payment histories on current and prior mortgages (24 months if
available);
Exh. A-2-3
(63) prior foreclosure history (for the past 24 months);
(64) prior bankruptcy history (for the past 24 months);
(65) a code indicating the Appraisal Type (Tax Assessment, BPO, Drive-By
Form 704, URAR, Form 2065, Form 2055 (Exterior only), Form 2055
(Interior Inspection), or AVM;
(66) if the Appraisal Type in #65 is an AVM, then a description of the AVM
type;
(67) a code indicating whether the loan is a fixed rate or adjustable rate
Mortgage Loan (to be provided in accordance with Standard and Poor's
loan type requirements - Field 14);
(68) Product Description (to be provided in accordance with Standard and
Poor's description categories - Field 7);
(69) Asset Verification (Purchase Money loans only), (yes, no); and
(70) A code indicating whether the Borrower(s) is self-employed (yes or no).
Exh. A-2-4
EXHIBIT B
CONTENTS OF EACH MORTGAGE FILE
The Mortgage Loan Documents for each Mortgage Loan shall include each of
the following items, which shall be delivered to the Custodian pursuant to
Section 2.01 of the Flow Mortgage Loan Purchase, Warranties and Servicing
Agreement to which this Exhibit is annexed (the "Agreement"):
(a) the original Mortgage Note bearing all intervening endorsements and
including any riders to the Mortgage Note endorsed "Pay to the order of
__________________________________, without recourse and signed in the
name of the previous owner by an authorized officer;
(b) the original of any guarantee executed in connection with the Mortgage
Note (if any);
(c) the original Mortgage with evidence of recording thereon or, copies
certified by the related recording office or if the original Mortgage
has not yet been returned from the recording office, a copy certified
by the Seller indicating that such Mortgage has been delivered for
recording. The return directions for the original Mortgage should
indicate, when recorded, mail to the Seller;
(d) the originals of all assumption, modification, consolidation or
extension agreements, (or, if an original of any of these documents has
not been returned from the recording office, a certified copy thereof,
the original to be delivered to the Seller forthwith after return from
such recording office) with evidence of recording thereon, if any;
(e) the original Assignment of Mortgage as appropriate, in recordable form,
for each Mortgage Loan to ____________________________, or the original
Assignment of Mortgage in recordable form into MERS;
(f) the originals of any intervening recorded Assignments of Mortgage
showing a complete chain of assignment from origination to the Seller,
including warehousing assignments, with evidence of recording thereon,
(or, if any original intervening Assignment of Mortgage has not been
returned from the recording office, a certified copy thereof, the
original to be delivered to the Custodian forthwith after return from
such recording office);
(g) with respect to each Mortgage Loan, the original mortgage title
insurance policy or attorney's opinion of title and abstract or a title
commitment or title binder if an original title insurance policy has
not been issued, or a duplicate copy of an original title insurance
policy; and
Exh. B-1
(h) the original or copy of the PMI policy or certificate of insurance,
where required and unless indicated otherwise as set forth in Section
4(l) herein.
In the event an Officer's Certificate of the Seller is delivered to the
Custodian because of a delay caused by the public recording office in
returning any recorded document, the Seller shall deliver to the Custodian,
within 60 days of the Closing Date, an Officer's Certificate which shall (i)
identify the recorded document, (ii) state that the recorded document has not
been delivered to the Custodian due solely to a delay caused by the public
recording office, (iii) state the amount of time generally required by the
applicable recording office to record and return a document submitted for
recordation, and (iv) specify the date the applicable recorded document will
be delivered to the Custodian. The Seller shall be required to deliver to the
Custodian the applicable recorded document by no later than 180 days following
the Closing Date, provided, that an extension of such date may be requested
from the Purchaser, which consent shall not be unreasonably withheld.
Exh. ▇-▇
▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇▇▇
▇▇▇. C-1
EXHIBIT D-1
CUSTODIAL ACCOUNT CERTIFICATION
_____________________, 200_
Greenpoint Mortgage Funding Inc. hereby certifies that it has established
the account described below as a Custodial Account pursuant to Section 5.04 of
the Flow Mortgage Loan Purchase, Warranties and Servicing Agreement, dated as
August 1, 2003, Conventional Residential Adjustable and Fixed Rate Mortgage
Loans, Group No. 2003-FLOW.
Title of Account: Greenpoint Mortgage Funding Inc. in trust for
the Purchaser, Group No. 2003-FLOW.
Account Number: _______________________
Address of office or branch
of the Seller at
which Account is maintained: _______________________
_______________________
_______________________
Greenpoint Mortgage Funding Inc.
By:____________________
Name:__________________
Title:_________________
Exh. D-1-1
EXHIBIT D-2
CUSTODIAL ACCOUNT LETTER AGREEMENT
_________________, 200_
To: __________________
__________________
__________________
(the "Depository")
As Seller under the Flow Mortgage Loan Purchase, Warranties and Servicing
Agreement, dated as of August 1, 2003, Conventional Residential Adjustable and
Fixed Rate Mortgage Loans, Group No. 2003-FLOW (the "Agreement"), we hereby
authorize and request you to establish an account, as a Custodial Account
pursuant to Section 5.04 of the Agreement, to be designated as "Greenpoint
Mortgage Funding Inc., in trust for the Purchaser - Conventional Residential
Adjustable and Fixed Rate Mortgage Loans - Group No. 2003-FLOW." All deposits
in the account shall be subject to withdrawal therefrom by order signed by the
Seller. You may refuse any deposit which would result in violation of the
requirement that the account be fully insured as described below. This letter
is submitted to you in duplicate. Please execute and return one original to
us.
Greenpoint Mortgage Funding Inc.
By:___________________________________
Name:_________________________________
Title:________________________________
Date:_________________________________
Exh. D-2-1
The undersigned, as Depository, hereby certifies that the above described
account has been established under Account Number __________, at the office of
the Depository indicated above, and agrees to honor withdrawals on such
account as provided above. The full amount deposited at any time in the
account will be insured by the Federal Deposit Insurance Corporation through
the Bank Insurance Fund ("BIF") or the Savings Association Insurance Fund
("SAIF").
_____________________________________
Depository
By:__________________________________
Name:________________________________
Title:_______________________________
Date:________________________________
Exh. D-2-2
EXHIBIT E-1
ESCROW ACCOUNT CERTIFICATION
__________________, 200_
Greenpoint Mortgage Funding Inc. hereby certifies that it has established
the account described below as an Escrow Account pursuant to Section 5.06 of
the Flow Mortgage Loan Purchase, Warranties and Servicing Agreement, dated as
of August 1, 2003, Conventional Residential Adjustable and Fixed Rate Mortgage
Loans, Group No. 2003-FLOW.
Title of Account: "Greenpoint Mortgage Funding Inc. in trust
for the Purchaser, Group No. 2003-FLOW, and
various Mortgagors."
Account Number: _________________________________
Address of office or branch
of the Seller at
which Account is maintained: _________________________________
_________________________________
_________________________________
_________________________________
Greenpoint Mortgage Funding Inc.
By:______________________________
Name:____________________________
Title:___________________________
Exh. E-1-1
EXHIBIT E-2
ESCROW ACCOUNT LETTER AGREEMENT
_________________, 200_
To: __________________
__________________
__________________
(the "Depository")
As Seller under the Flow Mortgage Loan Purchase, Warranties and Servicing
Agreement, dated as of August 1, 2003, Conventional Residential Adjustable and
Fixed Rate Mortgage Loans, Group No. 2003-FLOW (the "Agreement"), we hereby
authorize and request you to establish an account, as an Escrow Account
pursuant to Section 5.06 of the Agreement, to be designated as "Greenpoint
Mortgage Funding Inc., in trust for the Purchaser - Conventional Residential
Adjustable and Fixed Rate Mortgage Loans - Group No. 2003-FLOW." All deposits
in the account shall be subject to withdrawal therefrom by order signed by the
Seller. You may refuse any deposit which would result in violation of the
requirement that the account be fully insured as described below. This letter
is submitted to you in duplicate. Please execute and return one original to
us.
Greenpoint Mortgage Funding Inc.
By:___________________________________
Name:_________________________________
Title:________________________________
Date:_________________________________
Exh. E-2-1
The undersigned, as Depository, hereby certifies that the above described
account has been established under Account Number ______, at the office of the
Depository indicated above, and agrees to honor withdrawals on such account as
provided above. The full amount deposited at any time in the account will be
insured by the Federal Deposit Insurance Corporation through the Bank
Insurance Fund ("BIF") or the Savings Association Insurance Fund ("SAIF").
_____________________________________
Depository
By:__________________________________
Name:________________________________
Title:_______________________________
Date:________________________________
Exh. E-2-2
EXHIBIT F-1
FORM OF MONTHLY REMITTANCE ADVICE
FIELD NAME DESCRIPTION FORMAT
---------- ----------- ------
INVNUM INVESTOR LOAN NUMBER Number no decimals
SERVNUM SERVICER LOAN NUMBER, REQUIRED Number no decimals
BEGSCHEDBAL BEGINNING SCHEDULED BALANCE FOR SCHED/SCHED Number two decimals
BEGINNING TRAIL BALANCE FOR ACTUAL/ACTUAL, REQUIRED
SCHEDPRIN SCHEDULED PRINCIPAL AMOUNT FOR SCHEDULED/SCHEDULED Number two decimals
ACTUAL PRINCIPAL COLLECTED FOR ACTUAL/ACTUAL, REQUIRED, .00 IF
NO COLLECTIONS
CURT1 CURTAILMENT 1 ▇▇▇▇▇▇, .▇▇ IF NOT APPLICABLE Number two decimals
CURT1DATE CURTAILMENT 1 DATE, BLANK IF NOT APPLICABLE DD-MMM-YY
CURT1ADJ CURTAILMENT 1 ADJUSTMENT, .00 IF NOT APPLICABLE Number two decimals
CURT2 CURTAILMENT 2 ▇▇▇▇▇▇, .▇▇ IF NOT APPLICABLE Number two decimals
CURT2DATE CURTAILMENT 2 DATE, BLANK IF NOT APPLICABLE DD-MMM-YY
CURT2ADJ CURTAILMENT 2 ADJUSTMENT, .00 IF NOT APPLICABLE Number two decimals
LIQPRIN PAYOFF, LIQUIDATION PRINCIPAL, .00 IF NOT APPLICABLE Number two decimals
OTHPRIN OTHER PRINCIPAL, .00 IF NOT APPLICABLE Number two decimals
PRINREMIT TOTAL PRINCIPAL REMITTANCE AMOUNT, .00 IF NOT APPLICABLE Number two decimals
INTREMIT NET INTEREST REMIT, INCLUDE PAYOFF INTEREST, Number two decimals
.00 IF NOT APPLICABLE
TOTREMIT TOTAL REMITTANCE AMOUNT, .00 IF NOT APPLICABLE Number two decimals
ENDSCHEDBAL ENDING SCHEDULED BALANCE FOR SCHEDULED/SCHEDULED Number two decimals
ENDING TRIAL BALANCE FOR ACTUAL/ACTUAL .00 IF PAIDOFF, Number two decimals
LIQUIDATED OR FULL CHARGEOFF ENDACTBAL ENDING TRIAL BALANCE
.00 IF PAIDOFF, LIQUIDATED OR FULL CHARGEOFF
ENDDUEDATE ENDING ACTUAL DUE DATE, NOT LAST PAID INSTALLMENT DD-MMM-YY
ACTCODE 60 IF PAIDOFF, BLANK IF NOT APPLICABLE Number no decimals
ACTDATE ACTUAL PAYOFF DATE, BLANK IF NOT APPLICABLE DD-MMM-YY
INTRATE INTEREST RATE, REQUIRED Number seven decimals
Example .0700000 for 7.00%
SFRATE SERVICE FEE RATE, REQUIRED Number seven decimals
Example .0025000 for .25%
PTRATE PASS THRU RATE, REQUIRED Number seven decimals
Example .0675000 for 6.75%
PIPMT P&I CONSTANT, REQUIRED Number two decimals
.00 IF PAIDOFF
Exh. F-1-1
EXHIBIT F-2
STANDARD LAYOUT FOR DEFAULTED LOAN REPORT
1. Deal Identifier by Loan
2. SBO Loan Number
3. Loan Number
4. Investor Loan Number
5. Street Address
6. City
7. State
8. Zip Code
9. Original Loan Amount
10. Origination Date
11. First Payment Date
12. Current Loan Amount
13. Current Interest Rate
14. Current P&I Payment Amount
15. Scheduled Balance
16. Scheduled Due Date
17. Next Rate Adjustment Date
18. Next Payment Adjustment Date
19. Loan Term
20. Loan Type
21. Servicing Fee
22. Product Type
23. Property Type
24. Ownership Code
25. Actual Due Date
26. Delinquency Status
27. Reason for Default
28. FC Flag
29. Date Loan Reinstated
30. FC Suspended Date
31. Reason Suspended
32. FC Start Date (referral date)
33. Actual Notice of Intent Date
34. Actual First Legal Date
35. Date Bid Instructions Sent
36. Date F/C Sale Scheduled
37. Foreclosure Actual Sale Date
38. Actual Redemption End Date
39. Occupancy Status
40. Occupancy Status Date
41. Actual Eviction Start Date
42. Actual Eviction Complete Date
43. Loss Mit Workstation Status
44. Loss Mit Flag
45. Loss Mit Type
Exh. F-2-1
46. Loss Mit Start Date
47. Loss Mit Approval Date
48. Loss Mit Removal Date
49. REO Flag
50. Actual REO Start Date
51. REO List Date
52. REO List Price
53. Date REO Offer Received
54. Date REO Offer Accepted
55. REO Scheduled Close Date
56. REO Actual Closing Date
57. REO Net Sales proceeds
58. REO Sales Price
59. Paid Off Code
60. Paid in Full Date
61. MI Certificate Number
62. MI Cost
63. Other Advance Expenses
64. T&I Advances
65. Interest Advances
66. Liquidation Status
67. BK Atty Fees & Costs
68. FC Atty Fees & Costs
69. Eviction Atty Fees & Costs
70. Appraisal, BPO Costs
71. Property Preservation Fees
72. Actual Claim Filed Date
73. Actual Claim Amount Filed
74. Claim Amount Paid
75. Claim Funds Received Date
76. Realized Gain or Loss
77. BK Flag
78. Bankruptcy Chapter
79. Actual Bankruptcy Start Date
80. Actual Payment Plan Start Date
81. Actual Payment Plan End Date
82. Date POC Filed
83. Date Filed Relief/Dismissal
84. Relief/Dismissal Hearing Date
85. Date Relief/Dismissal Granted
86. Post Petition Due Date
87. Prepayment Flag
88. Prepayment Waived
89. Prepayment Premium Collected
90. Partial Prepayment Amount Collected
91. Prepayment Expiration Date
92. Origination Value Date
93. Origination Value Source
94. Original Value Amount
95. FC Valuation Amount
96. FC Valuation Source
Exh. F-2-2
97. FC Valuation Date
98. REO Value Source
99. REO Value(As-is)
100.REO Repaired Value
101.REO Value Date
102.Investor/Security Billing Date Sent
Exh. F-2-3
EXHIBIT G
ASSIGNMENT AND ASSUMPTION
_________________, 200_
ASSIGNMENT AND ASSUMPTION, dated __________, between
_____________________________, a ________________________ corporation having an
office at _____________________ ("Assignor") and ___________________________, a
________________ corporation having an office at ________________ ("Assignee"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
1. The Assignor hereby grants, transfers and assigns to Assignee all of
the right, title and interest of Assignor, as purchaser, with respect to the
Mortgage Loans identified on Exhibit A hereto (the "Mortgage Loans") in, to
and under that certain Flow Mortgage Loan Purchase, Warranties and Servicing
Agreement, Conventional Residential Adjustable and Fixed Rate Mortgage Loans,
Group No. 2003-FLOW (the "Flow Mortgage Loan Purchase, Warranties and
Servicing Agreement"), dated as of August 1, 2003, by and among ▇▇▇▇▇▇
Brothers Bank, FSB (the "Purchaser") and Greenpoint Mortgage Funding Inc. (the
"Seller") and that certain Custodial Agreement dated as of [____] (the
"Custodial Agreement"), by and between [____] (the "Custodian").
2. The Assignor warrants and represents to, and covenants with, the
Assignee that:
a. The Assignor is the lawful owner of the Mortgage Loans with the full
right to transfer the Mortgage Loans free from any and all claims and
encumbrances whatsoever;
b. The Assignor has not received notice of, and has no knowledge of, any
offsets, counterclaims or other defenses available to the Seller with respect
to the Flow Mortgage Loan Purchase, Warranties and Servicing Agreement or the
Mortgage Loans;
c. The Assignor has not waived or agreed to any waiver under, or agreed
to any amendment or other modification of, the Flow Mortgage Loan Purchase,
Warranties and Servicing Agreement, the Custodial Agreement or the Mortgage
Loans, including without limitation the transfer of the servicing obligations
under the Flow Mortgage Loan Purchase, Warranties and Servicing Agreement. The
Assignor has no knowledge of, and has not received notice of, any waivers
under or amendments or other modifications of, or assignments of rights or
obligations under, the Flow Mortgage Loan Purchase, Warranties and Servicing
Agreement or the Mortgage Loans; and
d. Neither the Assignor nor anyone acting on its behalf has offered,
transferred, pledged, sold or otherwise disposed of the Mortgage Loans, any
interest in the Mortgage Loans or any other similar security to, or solicited
any offer to buy or accept a transfer, pledge or other disposition of the
Mortgage Loans, any interest in the Mortgage Loans or any other similar
security from, or otherwise approached or negotiated with respect to the
Mortgage Loans, any interest in the Mortgage Loans or any
Exh. G-1
other similar security with, any person in any manner, or made any general
solicitation by means of general advertising or in any other manner, or taken
any other action which would constitute a distribution of the Mortgage Loans
under the Securities Act of 1933 (the "33 Act") or which would render the
disposition of the Mortgage Loans a violation of Section 5 of the 33 Act or
require registration pursuant thereto.
3. The Assignee warrants and represents to, and covenants with, the
Assignor and the Seller that:
a. The Assignee agrees to be bound, as Purchaser, by all of the terms,
covenants and conditions of the Flow Mortgage Loan Purchase, Warranties and
Servicing Agreement, the Mortgage Loans and the Custodial Agreement, and from
and after the date hereof, the Assignee assumes for the benefit of the Seller
and the Assignor all of the Assignor's obligations as Purchaser thereunder;
b. The Assignee understands that the Mortgage Loans have not been
registered under the 33 Act or the securities laws of any state;
c. The purchase price being paid by the Assignee for the Mortgage Loans
are in excess of $250,000 and will be paid by cash remittance of the full
purchase price within 60 days of the sale;
d. The Assignee is acquiring the Mortgage Loans for investment for its
own account only and not for any other person. In this connection, neither the
Assignee nor any Person authorized to act therefor has offered the Mortgage
Loans by means of any general advertising or general solicitation within the
meaning of Rule 502(c) of U.S. Securities and Exchange Commission Regulation
D, promulgated under the 33 Act;
e. The Assignee considers itself a substantial, sophisticated
institutional investor having such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and risks of
investment in the Mortgage Loans;
f. The Assignee has been furnished with all information regarding the
Mortgage Loans that it has requested from the Assignor or the Seller;
g. Neither the Assignee nor anyone acting on its behalf has offered,
transferred, pledged, sold or otherwise disposed of the Mortgage Loans, any
interest in the Mortgage Loans or any other similar security to, or solicited
any offer to buy or accept a transfer, pledge or other disposition of the
Mortgage Loans, any interest in the Mortgage Loans or any other similar
security from, or otherwise approached or negotiated with respect to the
Mortgage Loans, any interest in the Mortgage Loans or any other similar
security with, any person in any manner which would constitute a distribution
of the Mortgage Loans under the 33 Act or which would render the disposition
of the Mortgage Loans a violation of Section 5 of the 33 Act or require
registration pursuant thereto, nor will it act, nor has it authorized or will
it authorize any person to act, in such manner with respect to the Mortgage
Loans; and
Exh. G-2
h. Either: (1) the Assignee is not an employee benefit plan ("Plan")
within the meaning of section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA") or a plan (also "Plan") within the meaning
of section 4975(e)(1) of the Internal Revenue Code of 1986 ("Code"), and the
Assignee is not directly or indirectly purchasing the Mortgage Loans on behalf
of, investment manager of, as named fiduciary of, as trustee of, or with
assets of, a Plan; or (2) the Assignee's purchase of the Mortgage Loans will
not result in a prohibited transaction under section 406 of ERISA or section
4975 of the Code.
i. The Assignee's address for purposes of all notices and correspondence
related to the Mortgage Loans and the Flow Mortgage Loan Purchase, Warranties
and Servicing Agreement is:
_______________________________________
_______________________________________
_______________________________________
Attention: ____________________________
Exh. G-3
The Assignee's wire transfer instructions for purposes of all remittances
and payments related to the Mortgage Loans and the Flow Mortgage Loan
Purchase, Warranties and Servicing Agreement are:
_______________________________________
_______________________________________
_______________________________________
Exh. G-4
IN WITNESS WHEREOF, the parties have caused this Assignment and Assumption
to be executed by their duly authorized officers as of the date first above
written.
▇▇▇▇▇▇ BROTHERS BANK, FSB [_________________________________]
(Assignor) (Assignee)
By:___________________________________ By:_______________________________
Its:__________________________________ Its:______________________________
Taxpayer Taxpayer
Identification No. Identification No.
_____________________________________ __________________________________
Exh. G-5
EXHIBIT H
SELLER'S OFFICER'S CERTIFICATE
I, ____________________, hereby certify that I am the duly elected
[Vice] President of Greenpoint Mortgage Funding Inc., a corporation organized
under the laws of the state of [_______], (the "Seller") and further as
follows:
1. Attached hereto as Exhibit 1 is a true, correct and complete
copy of the certificate of incorporation of the Seller which is
in full force and effect on the date hereof and which has been
in effect without amendment, waiver, rescission or
modification.
2. Attached hereto as Exhibit 2 is a true, correct and complete
copy of the bylaws of the Seller which are in effect on the
date hereof and which have been in effect without amendment,
waiver, rescission or modification.
3. Attached hereto as Exhibit 3 is an original certificate of good
standing of the Seller issued within ten days of the date
hereof, and no event has occurred since the date thereof which
would impair such standing.
4. Attached hereto as Exhibit 4 is a true, correct and complete
copy of the corporate resolutions of the Board of Directors of
the Seller authorizing the Seller to execute and deliver each
of the Flow Mortgage Loan Purchase, Warranties and Servicing
Agreement, Group No. 2003-FLOW dated August 1, 2003 by and
between the Seller and ▇▇▇▇▇▇ Brothers Bank, FSB (the
"Purchaser") (the "Purchase Agreement") and to endorse the
Mortgage Notes and execute the Assignments of Mortgages by
original signature, and such resolutions are in effect on the
date hereof and have been in effect without amendment, waiver,
rescission or modification.
5. Either (i) no consent, approval, authorization or order of any
court or governmental agency or body is required for the
execution, delivery and performance by the Seller of or
compliance by the Seller with the Purchase Agreement, the sale
of the mortgage loans or the consummation of the transactions
contemplated by the agreements; or (ii) any required consent,
approval, authorization or order has been obtained by the
Seller.
6. Neither the consummation of the transactions contemplated by,
nor the fulfillment of the terms of the Purchase Agreement
conflicts or will conflict with or results or will result in a
breach of or constitutes or will constitute a default under the
charter or by-laws of the Seller, the terms of any indenture or
other agreement or instrument to which the Seller is a party or
by which it is bound or to which it is subject, or any statute
or order, rule, regulations, writ, injunction or decree of any
court, governmental authority or regulatory body to which the
Seller is subject or by which it is bound.
Exh. H-1
7. There is no action, suit, proceeding or investigation pending
or, to the best of my knowledge, threatened against the Seller
which, in my judgment, either in any one instance or in the
aggregate, may result in any material adverse change in the
business, operations, financial condition, properties or assets
of the Seller or in any material impairment of the right or
ability of the Seller to carry on its business substantially as
now conducted or in any material liability on the part of the
Seller or which would draw into question the validity of the
Purchase Agreement or the mortgage loans or of any action taken
or to be taken in connection with the transactions contemplated
hereby, or which would be likely to impair materially the
ability of the Seller to perform under the terms of the
Purchase Agreement.
8. Each person listed on Exhibit 5 attached hereto who, as an
officer or representative of the Seller, signed (a) the
Purchase Agreement and (b) any other document delivered prior
hereto or on the date hereof in connection with any purchase
described in the agreements set forth above was, at the
respective times of such signing and delivery, and is now, a
duly elected or appointed, qualified and acting officer or
representative of the Seller, who holds the office set forth
opposite his or her name on Exhibit 5, and the signatures of
such persons appearing on such documents are their genuine
signatures.
9. The Seller is duly authorized to engage in the transactions
described and contemplated in the Purchase Agreement.
10. The Mortgage Loans are not subject to any security interest,
claim, pledge, hypothecation or lien.
Exh. H-2
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the seal of
the Seller.
Dated:_______________________________ By: ___________________________________
[Seal] Name:
Title: [Vice] President
I, ________________________, an [Assistant] Secretary of Greenpoint
Mortgage Funding Inc., hereby certify that ____________ is the duly elected,
qualified and acting [Vice] President of the Seller and that the signature
appearing above is [her] [his] genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated: ______________________________ By: ___________________________________
[Seal] Name:
Title: [Vice] President
Exh. H-3
EXHIBIT 5 to
Seller's Officer's Certificate
Name Title Signature
______________________________
______________________________
______________________________
______________________________
______________________________
Exh. H-4
EXHIBIT I
FORM OF OPINION OF COUNSEL TO THE SELLER
(date)
▇▇▇▇▇▇ Brothers Bank, FSB
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
You have requested [our] [my] opinion, as [Assistant] General Counsel to
Greenpoint Mortgage Funding Inc. (the "Seller"), with respect to certain
matters in connection with the sale by the Seller of the Mortgage Loans
pursuant to that certain Flow Mortgage Loan Purchase, Warranties and Servicing
Agreement by and between the Seller and ▇▇▇▇▇▇ Brothers Bank, FSB (the
"Purchaser"), Group No. 2003-FLOW dated as of August 1, 2003 (the "Purchase
Agreement") which sale is in the form of whole loans, serviced pursuant
thereto. Capitalized terms not otherwise defined herein have the meanings set
forth in the Purchase Agreement.
[We] [I] have examined the following documents:
1. the Purchase Agreement;
2. the form of Assignment of Mortgage;
3. the form of endorsement of the Mortgage Notes; and
4. such other documents, records and papers as we have deemed necessary
and relevant as a basis for this opinion.
To the extent [we] [I] have deemed necessary and proper, [we] [I] have
relied upon the representations and warranties of the Seller contained in the
Purchase Agreement. [We] [I] have assumed the authenticity of all documents
submitted to [us] [me] as originals, the genuineness of all signatures, the
legal capacity of natural persons and the conformity to the originals of all
documents.
Exh. I-1
Based upon the foregoing, it is [our] [my] opinion that:
1. The Seller is a corporation duly formed, validly existing and in
good standing under the laws of the state of [_______] and is qualified
to transact business in, and is in good standing under, the laws of the
state of [________].
2. The Seller has the power to engage in the transactions contemplated
by the Purchase Agreement and all requisite power, authority and legal
right to execute and deliver the Purchase Agreement, and to perform and
observe the terms and conditions of such Agreement.
3. The Purchase Agreement has been duly authorized, executed and
delivered by the Seller and is a legal, valid and binding agreement
enforceable in accordance with its respective terms against the Seller,
subject to bankruptcy laws and other similar laws of general
application affecting rights of creditors and subject to the
application of the rules of equity, including those respecting the
availability of specific performance, none of which will materially
interfere with the realization of the benefits provided thereunder or
with the Purchaser's ownership of the Mortgage Loans.
4. The Seller has been duly authorized to allow any of its officers to
execute any and all documents by original signature in order to
complete the transactions contemplated by the Purchase Agreement and by
original signature in order to execute the endorsements to the Mortgage
Notes and the Assignments of Mortgages, and the original signature of
the officer at the Seller executing the endorsements to the Mortgage
Notes and the Assignments of Mortgages represents the legal and valid
signature of said officer of the Seller.
5. Either (i) no consent, approval, authorization or order of any court
or governmental agency or body is required for the execution, delivery
and performance by the Seller of or compliance by the Seller with the
Purchase Agreement or the sale of the Mortgage Loans or the
consummation of the transactions contemplated by the Purchase
Agreement; or (ii) any required consent, approval, authorization or
order has been obtained by the Seller.
6. Neither the consummation of the transactions contemplated by, nor
the fulfillment of the terms of, the Purchase Agreement conflicts or
will conflict with or results or will result in a breach of or
constitutes or will constitute a default under the charter or by-laws
of the Seller, the terms of any indenture or other agreement or
instrument to which the Seller is a party or by which it is bound or to
which it is subject, or violates any statute or order, rule,
regulations, writ, injunction or decree of any court, governmental
authority or regulatory body to which the Seller is subject or by which
it is bound.
7. There is no action, suit, proceeding or investigation pending or, to
the best of [our] [my] knowledge, threatened against the Seller which,
in [our] [my] judgment, either in any one instance or in the aggregate,
may result in any
Exh. I-2
material adverse change in the business, operations, financial
condition, properties or assets of the Seller or in any material
impairment of the right or ability of the Seller to carry on its
business substantially as now conducted or in any material liability on
the part of the Seller or which would draw into question the validity
of the Purchase Agreement, or the Mortgage Loans or of any action taken
or to be taken in connection with the transactions contemplated
thereby, or which would be likely to impair materially the ability of
the Seller to perform under the terms of the Purchase Agreement.
8. The sale of each Mortgage Note and Mortgage as and in the manner
contemplated by the Purchase Agreement is sufficient to fully transfer
to the Purchaser all right, title and interest of the Seller thereto as
noteholder and mortgagee.
9. The Mortgages have been duly assigned and the Mortgage Notes have
been duly endorsed as provided in the Purchase Agreement. The
Assignments of Mortgage are in recordable form, except for the
insertion of the name of the assignee, and upon the name of the
assignee being inserted, are acceptable for recording under the laws of
the state where each related Mortgaged Property is located. The
endorsement of the Mortgage Notes, the delivery to the Purchaser, or
its designee, of the Assignments of Mortgage, and the delivery of the
original endorsed Mortgage Notes to the Purchaser, or its designee, are
sufficient to permit the Purchaser to avail itself of all protection
available under applicable law against the claims of any present or
future creditors of the Seller, and are sufficient to prevent any other
sale, transfer, assignment, pledge or hypothecation of the Mortgages
and the Mortgage Notes by the Seller from being enforceable.
This opinion is given to you for your sole benefit, and no other person or
entity is entitled to rely hereon except that the purchaser or purchasers to
which you initially and directly resell the Mortgage Loans may rely on this
opinion as if it were addressed to them as of its date.
Very truly yours,
____________________________________
[Name]
[Assistant] General Counsel
Exh. I-3
EXHIBIT J-1
SECURITY RELEASE CERTIFICATION
___________________, 200_
Federal Home Loan Bank of
______(the "Association")
______________________________________
______________________________________
______________________________________
Attention: ___________________________
______________________________________
Re: Notice of Sale and Release of Collateral
Dear Sirs:
This letter serves as notice that Greenpoint Mortgage Funding Inc., a
corporation formed pursuant to the laws of the state of [_______] (the
"Seller") has committed to sell to ▇▇▇▇▇▇ Brothers Bank, FSB under a Flow
Mortgage Loan Purchase, Warranties and Servicing Agreement Group No. 2003-
FLOW, dated as of August 1, 2003, certain mortgage loans originated by the
Seller. The Seller warrants that the mortgage loans to be sold to ▇▇▇▇▇▇
Brothers Bank, FSB on this date pursuant to the Acknowledgment and Conveyance
Agreement dated as of ________ (the "Related Loans") are in addition to and
beyond any collateral required to secure advances made by the Association to
the Seller.
The Seller acknowledges that the Related Loans shall not be used as
additional or substitute collateral for advances made by the Association.
▇▇▇▇▇▇ Brothers Bank, FSB understands that the balance of the Seller's
mortgage loan portfolio may be used as collateral or additional collateral for
advances made by the Association, and confirms that it has no interest
therein.
Exh. J-1-1
Execution of this letter by the Association shall constitute a full and
complete release of any security interest, claim, or lien which the
Association may have against the Related Loans.
Very truly yours,
Greenpoint Mortgage Funding Inc.
By: ________________________________
Name:
Title:
Date:
Acknowledged and approved:
FEDERAL HOME LOAN BANK OF
_________________________________________
By: _____________________________________
Name:
Title:
Date:
Exh. J-1-2
EXHIBIT J-2
SECURITY RELEASE CERTIFICATION
I. Release of Security Interest
The financial institution named below hereby relinquishes any and all
right, title and interest it may have in all Mortgage Loans to be purchased by
▇▇▇▇▇▇ Brothers Bank, FSB from the Seller named below pursuant to that certain
Flow Mortgage Loan Purchase, Warranties and Servicing Agreement, Group No.
2003-FLOW, dated as of August 1, 2003 and certifies that all notes, mortgages,
assignments and other documents in its possession relating to such Mortgage
Loans have been delivered and released to the Seller named below or its
designees, as of the date and time of the sale of such Mortgage Loans to
▇▇▇▇▇▇ Brothers Bank, FSB pursuant to the Acknowledgment and Conveyance
Agreement dated as of __________.
Name and Address of Financial Institution
____________________________________
(name)
____________________________________
(Address)
By: ________________________________
Exh. J-2-1
II. Certification of Release
The Seller named below hereby certifies to ▇▇▇▇▇▇ Brothers Bank, FSB,
that, as of the date and time of the sale of the above-mentioned Mortgage
Loans to ▇▇▇▇▇▇ Brothers Bank, FSB, the security interests in the Mortgage
Loans released by the above-named financial institution comprise all security
interests relating to or affecting any and all such Mortgage Loans. The Seller
warrants that, as of such time, there are and will be no other security
interests affecting any or all of such Mortgage Loans.
Greenpoint Mortgage Funding Inc.
By: ________________________________
Name:
Date:
Exh. J-2-2