as Servicer as Seller and as Master Servicer
[________________],
as
Servicer
[________________],
as
Seller
and
[________________],
as
Master
Servicer
▇▇▇▇▇▇▇▇▇
Mortgage Securities Corporation
[Name
of
Series]
Dated
as
of [________] [__], 20[__]
TABLE
OF CONTENTS
|
Page
|
||
|
2
|
||
|
ARTICLE
II. SELLER’S ENGAGEMENT OF SERVICER TO PERFORM SERVICING RESPONSIBILITIES
|
11
|
|
|
Section
2.01
|
Contract
for Servicing; Possession of Servicing Files.
|
11
|
|
Section
2.02
|
Books
and Records.
|
12
|
|
ARTICLE
III. SERVICING OF THE MORTGAGE LOANS
|
13
|
|
|
Section
3.01
|
Servicer
to Service.
|
13
|
|
Section
3.02
|
Collection
of Mortgage Loan Payments.
|
15
|
|
Section
3.03
|
Establishment
of and Deposits to Custodial Account.
|
15
|
|
Section
3.04
|
Permitted
Withdrawals From Custodial Account.
|
16
|
|
Section
3.05
|
Establishment
of and Deposits to Escrow Account.
|
17
|
|
Section
3.06
|
Permitted
Withdrawals From Escrow Account.
|
18
|
|
Section
3.07
|
Maintenance
of PMI Policy and/or LPMI Policy; Claims.
|
19
|
|
Section
3.08
|
Fidelity
Bond and Errors and Omissions Insurance.
|
20
|
|
Section
3.09
|
Notification
of Adjustments.
|
20
|
|
Section
3.10
|
Completion
and Recordation of Assignments of Mortgage.
|
20
|
|
Section
3.11
|
Protection
of Accounts.
|
21
|
|
Section
3.12
|
Payment
of Taxes, Insurance and Other Charges.
|
21
|
|
Section
3.13
|
Maintenance
of Hazard Insurance.
|
22
|
|
Section
3.14
|
Maintenance
of Mortgage Blanket Insurance.
|
22
|
|
Section
3.15
|
Restoration
of Mortgaged Property.
|
23
|
|
Section
3.16
|
Title,
Management and Disposition of REO Property.
|
23
|
|
Section
3.17
|
Real
Estate Owned Reports.
|
26
|
|
Section
3.18
|
MERS.
|
26
|
|
Section
3.19
|
Waiver
of Prepayment Penalty Amounts.
|
26
|
|
Section
3.20
|
Safeguarding
Customer Information.
|
27
|
|
ARTICLE
IV.
|
27
|
|
|
Section
4.01
|
Remittances.
|
27
|
|
Section
4.02
|
Statements
to Master Servicer.
|
28
|
|
Section
4.03
|
Monthly
Advances by Servicer.
|
29
|
| ARTICLE V. GENERAL SERVICING PROCEDURES |
30
|
|
|
Section
5.01
|
Servicing
Compensation.
|
30
|
|
Section
5.02
|
Annual
Audit Report.
|
30
|
|
Section
5.03
|
Annual
Officer’s Certificate.
|
30
|
|
Section
5.04
|
Transfers
of Mortgaged Property.
|
31
|
|
ARTICLE
VI. REPRESENTATIONS, WARRANTIES AND AGREEMENTS
|
33
|
|
|
Section
6.01
|
Representations,
Warranties and Agreements of the Servicer.
|
33
|
|
Section
6.02
|
Remedies
for Breach of Representations and Warranties of the Servicer.
|
34
|
|
Section
6.03
|
Additional
Indemnification by the Servicer; Third Party Claims.
|
35
|
|
Section
6.04
|
[Reserved].
|
36
|
ii
|
Section
6.05
|
Indemnification
with Respect to Certain Taxes and Loss of REMIC Status.
|
36
|
|
Section
6.06
|
Reporting
Requirements of the Commission and Indemnification.
|
36
|
|
ARTICLE
VII. THE SERVICER
|
37
|
|
|
Section
7.01
|
Merger
or Consolidation of the Servicer.
|
37
|
|
Section
7.02
|
Limitation
on Liability of the Servicer and Others.
|
37
|
|
Section
7.03
|
Limitation
on Resignation and Assignment by the Servicer.
|
38
|
|
Section
7.04
|
Subservicing
Agreements and Successor Subservicer.
|
39
|
|
ARTICLE
VIII. TERMINATION
|
40
|
|
|
Section
8.01
|
Termination
for Cause.
|
40
|
|
Section
8.02
|
Termination
Without Cause.
|
41
|
|
ARTICLE
IX. MISCELLANEOUS PROVISIONS
|
42
|
|
|
Section
9.01
|
Successor
to the Servicer.
|
42
|
|
Section
9.02
|
Costs.
|
44
|
|
Section
9.03
|
Notices.
|
44
|
|
Section
9.04
|
Severability
Clause.
|
45
|
|
Section
9.05
|
No
Personal Solicitation.
|
46
|
|
Section
9.06
|
Counterparts.
|
46
|
|
Section
9.07
|
Place
of Delivery and Governing Law.
|
46
|
|
Section
9.08
|
Further
Agreements.
|
47
|
|
Section
9.09
|
Intention
of the Parties.
|
47
|
|
Section
9.10
|
Successors
and Assigns; Assignment of Servicing Agreement.
|
47
|
|
Section
9.11
|
Assignment
by the Seller.
|
47
|
|
Section
9.12
|
Waivers.
|
47
|
|
Section
9.13
|
Exhibits.
|
47
|
|
Section
9.14
|
General
Interpretive Principles.
|
48
|
|
Section
9.15
|
Reproduction
of Documents.
|
48
|
|
Protection
of Confidential Information.
|
48
|
|
|
Section
9.17
|
Amendment.
|
49
|
|
EXHIBIT
A
|
Mortgage
Loan Schedule
|
|
EXHIBIT
B
|
Custodial
Account Certification
|
|
EXHIBIT
C
|
Escrow
Account Certification
|
|
EXHIBIT
D-1
|
Master
Servicer Data Field Requirements (Standard
Layout)
|
|
EXHIBIT
D-2
|
Master
Servicer Default File Format
|
|
EXHIBIT
E
|
Form
of Certification to be Provided to the Depositor, the Master Servicer
and
the Trustee by the Servicer
|
iii
THIS
SERVICING AGREEMENT (this “Agreement”), entered into as of the [__] day of
[________], 20[__], by and among [____________], a [____________] (“the
“Seller”), [____________], a [____________] (the “Servicer”), and
[____________], as Master Servicer under the Pooling and Servicing Agreement
(as
defined herein), recites and provides as follows:
RECITALS
[ADD
ANY
NECESSARY RECITALS]
WHEREAS,
the Seller has conveyed certain mortgage loans identified on Exhibit A hereto
(the “Mortgage Loans”) on a [____________] basis to ▇▇▇▇▇▇▇▇▇ Mortgage
Securities Corporation, a Delaware corporation (the “Depositor”), pursuant to a
mortgage loan purchase agreement dated as of [________] [__], 20[__] (the
“Mortgage Loan Purchase Agreement”), which in turn has conveyed the Mortgage
Loans to [______________], solely in its capacity as trustee (in such capacity,
the “Trustee”), under a pooling and servicing agreement dated as of [________]
[__], 20[__] (the “Pooling and Servicing Agreement”), among the Trustee,
[______________], as master servicer (“[______________],” and together with any
successor Master Servicer appointed pursuant to the provisions of the Pooling
and Servicing Agreement, the “Master Servicer”), and the Depositor.
WHEREAS,
from time to time certain other mortgage loans conveyed by the Depositor to
the
Trustee under the Pooling and Servicing Agreement on the Closing Date and
serviced by other servicers may subsequent to the Closing Date be transferred
to
the Servicer for servicing under this Agreement and Exhibit A hereto will be
amended to include such mortgage loans which will then be “Mortgage Loans” under
this Agreement.
WHEREAS,
the Seller desires that the Servicer service the Mortgage Loans pursuant to
this
Agreement, and the Servicer has agreed to do so, subject to the right of the
Seller and of the Master Servicer to terminate the rights and obligations of
the
Servicer hereunder at any time and to the other conditions set forth
herein.
WHEREAS,
the Master Servicer shall be obligated under the Pooling and Servicing
Agreement, among other things, to supervise the servicing of the Mortgage Loans
on behalf of the Trustee, and shall have the right, under certain circumstances,
to terminate the rights and obligations of the Servicer under this Servicing
Agreement.
WHEREAS,
the Seller and the Servicer acknowledge and agree that the Seller will assign
all of its rights and delegate all of its obligations hereunder (excluding
the
Seller’s rights and obligations as owner of the servicing rights relating to the
Mortgage Loans) to the Depositor and the Depositor will assign all of its rights
(but not the obligations, except as set forth in the Pooling and Servicing
Agreement) hereunder to the Trustee pursuant to the Pooling and Servicing
Agreement, and that each reference herein (other than with respect to the
Seller’s ownership of the servicing rights) to the Seller is intended, unless
otherwise specified, to mean the Seller or the Trustee, as assignee, whichever
is the owner of the Mortgage Loans from time to time.
NOW,
THEREFORE, in consideration of the mutual agreements hereinafter set forth
and
for other good and valuable consideration, the receipt and adequacy of which
are
hereby acknowledged, the Seller, the Servicer and the Master Servicer hereby
agree as follows:
ARTICLE
I
DEFINITIONS
The
following terms are defined as follows (except as otherwise agreed in writing
by
the parties):
Accepted
Servicing Practices:
With
respect to any Mortgage Loan, those mortgage servicing practices of prudent
mortgage lending institutions that service mortgage loans of the same type
as
such Mortgage Loans in the jurisdiction where the related Mortgaged Property
is
located.
Adjustable
Rate Mortgage Loan:
A
Mortgage Loan serviced pursuant to this Agreement under which the Mortgage
Interest Rate is adjusted from time to time in accordance with the terms and
provisions of the related Mortgage Note.
Aggregate
Loan Balance:
At any
date of determination, the outstanding principal balance of the Mortgage Loans
serviced hereunder.
Agreement:
This
Servicing Agreement and all amendments hereof and supplements
hereto.
Ancillary
Income:
All
income derived from the Mortgage Loans, other than Servicing Fees and Prepayment
Penalty Amounts, 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.
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 transfer of the Mortgage
to
the party indicated therein, which assignment, notice of transfer or equivalent
instrument may be in the form of one or more blanket assignments covering the
Mortgage Loans secured by Mortgaged Properties located in the same jurisdiction,
if permitted by law.
Best
Efforts:
Efforts
determined to be reasonably diligent by the Seller or the Servicer, as the
case
may be, in its sole discretion. Such efforts do not require the Seller or the
Servicer, as the case may be, to enter into any litigation, arbitration or
other
legal or quasi-legal proceeding, nor do they require the Seller or the Servicer,
as the case may be, to advance or expend fees or sums of money in addition
to
those specifically set forth in this Agreement.
2
Business
Day:
Any day
other than (i) a Saturday or a Sunday or (ii) a day on which banking
institutions in [__________],[__________],[__________], New York, New York
or,
if other than New York, the city in which the corporate trust office of the
Trustee is located.
Certificates:
Any or
all of the Certificates issued pursuant to the Pooling and Servicing
Agreement.
Closing
Date:
[________] [__], 20[__].
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.
Condemnation
Proceeds:
All
awards of 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.
Costs:
For any
Person, any claims, losses, damages, penalties, fines, forfeitures, reasonable
and necessary legal fees and related costs, judgments, and other costs and
expenses of such Person.
Custodial
Account:
The
separate account or accounts created and maintained pursuant to Section
3.03.
Custodian:
Each of
[___________],[___________] and [___________] and their respective
successors.
Cut-off
Date:
[________] [__], 20[__].
Depositor:
▇▇▇▇▇▇▇▇▇ Mortgage Securities Corporation or any successor in
interest.
Determination
Date:
With
respect to each Remittance Date, the [___] day of the month in which such
Remittance Date occurs, or, if such [___] day is not a Business Day, the next
succeeding Business Day.
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 immediately succeeding month.
Due
Period:
With
respect to each Remittance Date, the period commencing on the second day of
the
month immediately preceding the month of the Remittance Date and ending on
the
first day of the month of the Remittance Date.
Eligible
Deposit Account:
An
account that is maintained with a federal or state-chartered depository
institution or trust company that complies with the definition of Eligible
Institution.
3
Eligible
Institution:
Any of
the following:
|
(i)
|
an
institution whose:
|
(A) commercial
paper, short-term debt obligations, or other short-term deposits are rated
at
least “A-1+” or long-term unsecured debt obligations are rated at least “AA-” by
S&P, if the amounts on deposit are to be held in the account for no more
than 365 days; or
(B) commercial
paper, short-term debt obligations, demand deposits, or other short-term
deposits are rated at least “A-2” by S&P, if the amounts on deposit are to
be held in the account for no more than 30 days and are not intended to be
used
as credit enhancement. Upon the loss of the required rating set forth in this
clause (ii), the accounts shall be transferred immediately to accounts which
have the required rating. Furthermore, commingling by the Servicer is acceptable
at the A-2 rating level if the Servicer is a bank, thrift or depository and
provided the Servicer has the capability to immediately segregate funds and
commence remittance to an Eligible Deposit Account upon a downgrade;
or
(ii) the
corporate trust department of a federal depository institution or
state-chartered depository institution subject to regulations regarding
fiduciary funds on deposit similar to Title 12 of the U.S. Code of Federal
Regulation Section 9.10(b), which, in either case, has corporate trust powers
and is acting in its fiduciary capacity.
Eligible
Investments:
Any one
or more of the obligations and securities listed below which investment provides
for a date of maturity not later than the Determination Date in each
month:
(i)
direct
obligations of, and obligations fully guaranteed as to timely payment of
principal and interest 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 (“Direct
Obligations”);
(ii)
federal
funds, or demand and time deposits in, certificates of deposits of, or bankers’
acceptances issued by, any depository institution or trust company (including
U.S. subsidiaries of foreign depositories and the Trustee or any agent of the
Trustee, acting in its respective commercial capacity) incorporated or organized
under the laws of the United States of America or any state thereof and subject
to supervision and examination by federal or state banking authorities, so
long
as at the time of investment or the 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 or deposit obligations
of
such holding company or deposit institution, as the case may be) have been
rated
by each Rating Agency in its highest short-term rating category or one of its
two highest long-term rating categories;
4
(iii)
repurchase
agreements collateralized by Direct Obligations or securities guaranteed by
▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac with any registered broker/dealer subject
to Securities Investors’ Protection Corporation jurisdiction or any commercial
bank insured by the FDIC, if such broker/dealer or bank has an uninsured,
unsecured and unguaranteed obligation rated by each Rating Agency in its highest
short-term rating category;
(iv)
securities
bearing interest or sold at a discount issued by any corporation incorporated
under the laws of the United States of America or any state thereof which have
a
credit rating from each Rating Agency, at the time of investment or the
contractual commitment providing for such investment, at least equal to one
of
the two highest long-term credit rating categories of each Rating Agency;
provided,
however,
that
securities issued by any particular corporation will not be Eligible Investments
to the extent that investment therein will cause the then outstanding principal
amount of securities issued by such corporation and held as part of the Trust
Fund to exceed 20% of the sum of the Aggregate Loan Balance and the aggregate
principal amount of all Eligible Investments in the Certificate Account;
provided, further, that such securities will not be Eligible Investments if
they
are published as being under review with negative implications from any Rating
Agency;
(v)
commercial
paper (including both non-interest-bearing discount obligations and
interest-bearing obligations payable on demand or on a specified date not more
than 180 days after the date of issuance thereof) rated by each Rating Agency
in
its highest short-term rating category;
(vi)
a
Qualified GIC;
(vii)
certificates
or receipts representing direct ownership interests in future interest or
principal payments on obligations of the United States of America or its
agencies or instrumentalities (which obligations are backed by the full faith
and credit of the United States of America) held by a custodian in safekeeping
on behalf of the holders of such receipts; and
(viii)
any
other
demand, money market, common trust fund or time deposit or obligation, or
interest-bearing or other security or investment, (A) rated in the highest
rating category by each Rating Agency or (B) that would not adversely affect
the
then current rating by any Rating Agency of any of the Certificates. Such
investments in this subsection (viii) may include money market mutual funds
or
common trust funds, including any fund for which the Trustee, the Master
Servicer or an affiliate thereof serves as an investment advisor, administrator,
shareholder servicing agent, and/or custodian or subcustodian, notwithstanding
that (x) the Trustee, the Master Servicer or an affiliate thereof charges and
collects fees and expenses from such funds for services rendered, (y) the
Trustee, the Master Servicer or an affiliate thereof charges and collects fees
and expenses for services rendered pursuant to this Agreement, and (z) services
performed for such funds and pursuant to this Agreement may converge at any
time.
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.
5
Errors
and Omissions Insurance:
Errors
and Omissions Insurance to be maintained by the Servicer in accordance with
the
▇▇▇▇▇▇ Mae Guides.
Escrow
Account:
The
separate account or accounts created and maintained pursuant to Section
3.05.
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.
Event
of Default:
Any
event set forth in Section 8.01.
▇▇▇▇▇▇
▇▇▇:
▇▇▇▇▇▇
▇▇▇, or any successor thereto.
▇▇▇▇▇▇
Mae Guides:
The
▇▇▇▇▇▇ ▇▇▇ Selling Guide and the ▇▇▇▇▇▇ Mae Servicing Guide and all amendments
or additions thereto.
FDIC:
The
Federal Deposit Insurance Corporation or any successor thereto.
Fidelity
Bond:
A
fidelity bond to be maintained by the Servicer in accordance with the ▇▇▇▇▇▇
▇▇▇
Guides.
▇▇▇▇▇▇▇
Mac:
▇▇▇▇▇▇▇
Mac or any successor thereto.
▇▇▇▇▇▇
Mae:
The
Government National Mortgage Association or any successor thereto.
Insurance
Proceeds:
With
respect to each Mortgage Loan, proceeds of insurance policies insuring the
Mortgage Loan or the related Mortgaged Property including proceeds of any hazard
or flood insurance policy, PMI Policy or LPMI Policy.
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 REO Property, if
the
Mortgaged Property is acquired in satisfaction of the Mortgage
Loan.
LPMI
Fee:
With
respect to each LPMI Loan, the portion of the Mortgage Interest Rate as set
forth on the related Mortgage Loan Schedule (which shall be payable solely
from
the interest portion of Monthly Payments, Insurance Proceeds, Condemnation
Proceeds or Liquidation Proceeds), which, during such period prior to the
required cancellation of the LPMI Policy, shall be used to pay the premium
due
on the related LPMI Policy.
LPMI
Insurer:
[________________].
6
LPMI
Loan:
A
Mortgage Loan covered by an LPMI Policy, as set forth in the Mortgage Loan
Schedule or otherwise identified to the Servicer in writing.
LPMI
Policy:
A
policy of primary mortgage guaranty insurance issued by a LPMI Insurer pursuant
to which the related premium is to be paid from payments of interest made by
the
Mortgagor.
Master
Servicer:
[________________],
or any
successor in interest, or if any successor master servicer shall be appointed
as
provided in the Pooling and Servicing Agreement, then such successor master
servicer.
MERS:
Mortgage Electronic Registration Systems, Inc., a Delaware corporation, or
any
successor in interest thereto.
MERS
Eligible Mortgage Loan:
Any
Mortgage
Loan that has been designated by the Servicer as recordable in the name of
MERS.
MERS
Mortgage Loan:
Any
Mortgage Loan as to which the related Mortgage, or an Assignment of Mortgage,
has been or will be recorded in the name of MERS, as agent for the holder from
time to time of the Mortgage Note.
Monthly
Advance:
With
respect to each Remittance Date and each Mortgage Loan, an amount equal to
the Monthly Payment (with the interest portion of such Monthly Payment adjusted
to the Mortgage Loan Remittance Rate) that was due on the Mortgage Loan on
the
Due Date in the related Due Period, and that (i) was delinquent at the close
of
business on the related Determination Date and (ii) was not the subject of
a
previous Monthly Advance, but only to the extent that such amount is expected,
in the reasonable judgment of the Servicer, to be recoverable from collections
or other recoveries in respect of such Mortgage Loan. To the extent that the
Servicer determines that any such amount is not recoverable from collections
or
other recoveries in respect of such Mortgage Loan, such determination shall
be
evidenced by a certificate of a Servicing Officer delivered to the Master
Servicer setting forth such determination and the procedures and considerations
of the Servicer forming the basis of such determination.
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
in
real property securing the Mortgage Note.
Mortgage
Loan:
An
individual Mortgage Loan that is the subject of this Agreement, each Mortgage
Loan subject to this Agreement being identified on the Mortgage Loan Schedule,
which Mortgage Loan includes without limitation the Mortgage Loan documents,
the
Monthly Payments, Principal Prepayments, Liquidation Proceeds, Condemnation
Proceeds, Insurance Proceeds, REO Disposition Proceeds, and all other rights,
benefits, proceeds and obligations arising from or in connection with such
Mortgage Loan.
7
Mortgage
Loan Remittance Rate:
With
respect to each Mortgage Loan, the annual rate of interest remitted to the
Master Servicer, which shall be equal to the Mortgage Interest Rate minus the
applicable Servicing Fee.
Mortgage
Loan Schedule:
A
schedule of the Mortgage Loans setting forth information with respect to such
Mortgage Loans (including any MERS identification number (if available) with
respect to each MERS Mortgage Loan or MERS Eligible Mortgage Loan and a
Prepayment Penalty Schedule), attached hereto as Exhibit A, which may be amended
from time to time to include additional mortgage loans which are transferred
to
the Servicer by a Prior Servicer in a Servicing Transfer.
Mortgage
Note:
The
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.
Non-MERS
Eligible Mortgage Loan:
Any
Mortgage
Loan other than a MERS Eligible Mortgage Loan.
Non-MERS
Mortgage Loan:
Any
Mortgage Loan other than a MERS Mortgage Loan.
Opinion
of Counsel:
A
written opinion of counsel, who may be an employee of the Servicer, reasonably
acceptable to the Seller, but which must be independent outside counsel with
respect to any such opinion of counsel concerning (i) the non-recordation of
Mortgage Loans pursuant to Section 2.02 hereof and (ii) federal income tax
matters.
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.
PMI
Policy:
A
policy of primary mortgage guaranty insurance issued by a Qualified Insurer,
as
required by this Agreement with respect to certain Mortgage Loans.
Pooling
and Servicing Agreement:
The
Pooling and Servicing Agreement dated as of [________] [__], 20[__], among
the
Trustee, the Master Servicer and the Depositor.
Prepayment
Interest Excess Amount:
With
respect to any Principal Prepayment in full which is applied to the related
Mortgage Loan from the first day of the month of any Remittance Date through
the
sixteenth day of the month of such Remittance Date, all amounts paid in respect
of interest on such Principal Prepayment in full. A Prepayment Interest Excess
Amount cannot result from a Principal Prepayment in part, but only from a
Principal Prepayment in full. [May vary in accordance with
transaction.]
Prepayment
Interest Shortfall Amount:
With
respect to any Remittance Date and any Principal Prepayment in full which is
applied to the related Mortgage Loan from the seventeenth day of the month
immediately preceding the month of such Remittance Date through the last day
of
the month immediately preceding the month of such Remittance Date, the amount
of
interest (net of the related Servicing Fee) that would have accrued on the
amount of such Principal Prepayment in full from the date on which such
Principal Prepayment was applied to such Mortgage Loan until the last day of
the
month immediately preceding the month of such Remittance Date, inclusive. With
respect to any Remittance Date and any Principal Prepayment in part which is
applied to the related Mortgage Loan during the related Prepayment Period,
the
amount of interest that would have accrued on the amount of such Principal
Prepayment in part from the date on which such Principal Prepayment in part
was
applied to such Mortgage Loan until the end of the Prepayment Period, inclusive.
[May vary in accordance with transaction.]
8
Prepayment
Penalty Amount:
With
respect to any Remittance Date, all prepayment penalties, penalty or yield
maintenance premiums or charges paid by the obligors under the Mortgage Notes
due to Principal Prepayments collected by the Servicer during the immediately
preceding Prepayment Period.
Prepayment
Penalty Schedule:
A data
field in the Mortgage Loan Schedule attached hereto as Exhibit A which sets
forth the amount or method of calculation of the Prepayment Penalty Amount
and
the term during which such Prepayment Penalty Amount is imposed with respect
to
a Mortgage Loan.
Prepayment
Period:
With
respect to any Remittance Date and a Principal Prepayment in full, the period
from the seventeenth day of the month immediately preceding the month of such
Remittance Date to the sixteenth day of the month of such Remittance Date.
With
respect to any Remittance Date and any Principal Prepayment in part, the
calendar month immediately preceding the month of such Remittance Date. [May
vary in accordance with transaction.]
Prime
Rate:
The
prime rate published from time to time, as published as the average rate in
The
Wall Street Journal Northeast Edition.
Principal
Prepayment:
Any
payment or other recovery of principal on a Mortgage Loan which is received
in
advance of its scheduled Due Date 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.
Prior
Servicer:
Any
prior servicer (other than the Servicer) of any of the Mortgage
Loans.
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 ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac.
Rating
Agency:
Each of
[_______], [_______] and [_______].
REMIC:
A “real
estate mortgage investment conduit” within the meaning of Section 860D of the
Code.
9
Remittance
Date:
The
[___] day (or if such [___] day is not a Business Day, the first Business Day
immediately following) of any month.
REO
Disposition:
The
final sale by the Servicer of any REO Property.
REO
Disposition Proceeds:
All
amounts received with respect to an REO Disposition pursuant to Section
3.16.
REO
Property:
A
Mortgaged Property acquired by the Servicer on behalf of the Trustee through
foreclosure or by deed in lieu of foreclosure, pursuant to Section
3.16.
Retained
Interest:
The
meaning set forth in the Pooling and Servicing Agreement.
Retained
Interest Holder:
The
meaning set forth in the Pooling and Servicing Agreement.
Seller:
[______________] or its successors in interest and assigns.
Servicer:
[______________] or its successor in interest or assigns or any successor to
the
Servicer under this Agreement as herein provided.
Servicing
Advances:
All
customary, reasonable and necessary “out of pocket” costs and expenses
(including reasonable attorneys’ fees and disbursements) incurred in the
performance by the Servicer of its servicing obligations, including, but not
limited to, the cost of (i) the preservation, inspection, restoration and
protection of the Mortgaged Property, (ii) any enforcement or administrative
or
judicial proceedings, including foreclosures, (iii) the management and
liquidation of the Mortgaged Property if the Mortgaged Property is acquired
in
satisfaction of the Mortgage, (iv) taxes, assessments, water rates, sewer rents
and other charges which are or may become a lien upon the Mortgaged Property,
and PMI Policy premiums and
fire
and hazard insurance coverage, (v) any losses sustained by the Servicer with
respect to the liquidation of the Mortgaged Property and (vi) compliance with
the obligations pursuant to the provisions of the ▇▇▇▇▇▇ Mae
Guides.
Servicing
Fee:
An
amount equal to (a) one-twelfth the product of (i) a rate per annum equal to
[___]% and (ii) the outstanding principal balance of such Mortgage Loan and
(b)
any Prepayment Interest Excess Amount. The obligation of the Trustee 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 to the extent permitted by Section 3.04 of this Agreement) of such
Monthly Payment collected by the Servicer or as otherwise provided under this
Agreement.
Servicing
File:
The
items pertaining to a particular Mortgage Loan including, but not limited to,
the computer files, data disks, books, records, data tapes, notes, and all
additional documents generated as a result of or utilized in originating and/or
servicing each Mortgage Loan, which are held in trust for the Trustee by the
Servicer.
Servicing
Officer:
Any
officer of the Servicer involved in or responsible for, the administration
and
servicing of the Mortgage Loans whose name appears on a list of servicing
officers furnished by the Servicer to the Master Servicer or the Seller upon
request, as such list may from time to time be amended.
10
Servicing
Transfer:
Any
transfer of the servicing by a Prior Servicer of Mortgage Loans to the Servicer
under this Agreement.
Servicing
Transfer Date:
The
date on which a Servicing Transfer occurs.
S&P:
Standard & Poor’s Ratings Services, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies,
Inc. or any successor in interest.
Trust
Fund:
The
trust fund established by the Pooling and Servicing Agreement, the assets of
which consist of the Mortgage Loans and any related assets.
Trustee:
[_________] or any successor in interest, or if any successor trustee or
co-trustee shall be appointed as provided in the Pooling and Servicing
Agreement, then such successor trustee or such co-trustee, as the case may
be.
Any
capitalized terms used and not defined in this Agreement shall have the meanings
ascribed to such terms in the Pooling and Servicing Agreement.
ARTICLE
II
SELLER’S
ENGAGEMENT OF SERVICER TO PERFORM SERVICING
RESPONSIBILITIES
Section
2.01 Contract
for Servicing; Possession of Servicing Files.
The
Seller, by execution and delivery of this Agreement, does hereby contract with
the Servicer, subject to the terms of this Agreement, for the servicing of
the
Mortgage Loans. On or before the Closing Date or Servicing Transfer Date, as
applicable, the Seller shall cause to be delivered the Servicing Files with
respect to the Mortgage Loans listed on the Mortgage Loan Schedule to the
Servicer. Each Servicing File delivered to a Servicer shall be held in trust
by
such Servicer for the benefit of the Trustee; provided, however, that the
Servicer shall have no liability for any Servicing Files (or portions thereof)
not delivered by the Seller. The Servicer’s possession of any portion of the
Mortgage Loan documents shall be at the will of the Trustee for the sole purpose
of facilitating servicing of the related Mortgage Loan pursuant to this
Agreement, and such retention and possession by the Servicer shall be in a
custodial capacity only. The ownership of each Mortgage Note, Mortgage, and
the
contents of the Servicing File shall be vested in the Trustee 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 Servicer shall immediately vest
in
the Trustee and shall be retained and maintained, in trust, by the Servicer
at
the will of the Trustee in such custodial capacity only. The portion of each
Servicing File retained by the Servicer pursuant to this Agreement shall be
segregated from the other books and records of the Servicer and shall be
appropriately marked to clearly reflect the ownership of the related Mortgage
Loan by the Trustee. The Servicer shall release from its custody the contents
of
any Servicing File retained by it only in accordance with this
Agreement.
11
Section
2.02 Books
and Records.
(a)
Subject
to Section 3.01(a) hereof, as soon as practicable after the Closing Date, the
Servicing Transfer Date or the date on which a Qualifying Substitute Mortgage
Loan is delivered pursuant to Section [___] of the Pooling and Servicing
Agreement, as applicable (but in no event more than 90 days thereafter except
to
the extent delays are caused by the applicable recording office), the Servicer,
at the expense of the Depositor, shall cause the Mortgage or Assignment of
Mortgage, as applicable, with respect to each MERS Eligible Mortgage Loan,
to be
properly recorded in the name of MERS in the public recording office in the
applicable jurisdiction, or shall ascertain that such have previously been
so
recorded and, with the cooperation of the Trustee, shall take such actions
as
are necessary to cause the Trustee to be clearly identified as the owner of
each
MERS Mortgage Loan and each MERS Eligible Mortgage Loan on the records of MERS
for purposes of the system of recording transfers of beneficial ownership of
mortgages maintained by MERS.
(b)
Subject
to Section 3.01(a) hereof, an Assignment of Mortgage in favor of the Trustee
shall be recorded as to each Non-MERS Mortgage Loan unless instructions to
the
contrary are delivered to the Servicer, in writing, by the Seller. Subject
to
the preceding sentence, as soon as practicable after the Closing Date or
Servicing Transfer Date, as applicable (but in no event more than 90 days
thereafter except to the extent delays are caused by the applicable recording
office), the Servicer, at the expense of the Seller, shall cause to be properly
recorded in each public recording office where such Non-MERS Eligible Mortgage
Loans are recorded each Assignment of Mortgage.
(c)
Additionally,
the Servicer shall prepare and execute, at the direction of the Trustee, any
note endorsements relating to any of the Non-MERS Mortgage Loans.
(d)
All
rights arising out of the Mortgage Loans shall be vested in the Trustee, subject
to the Servicer’s right to service and administer the Mortgage Loans hereunder
in accordance with the terms of this Agreement. All funds received on or in
connection with a Mortgage Loan, other than the Servicing Fee and other
compensation to which the Servicer is entitled as set forth herein, including
but not limited to any and all servicing compensation pursuant to Section 5.01
below, shall be received and held by the Servicer in trust for the benefit
of
the Trustee pursuant to the terms of this Agreement.
(e)
Any
out-of-pocket costs incurred by the Servicer pursuant to this Section 2.02
and
Section 3.01(a), including any recording or other fees in connection with the
Servicer’s obtaining the necessary powers of attorney (and which are specified
herein to be an expense of the Seller), shall be reimbursed to the Servicer
by
the Seller within five (5) Business Days of receipt by the Seller of an invoice
for reimbursement. The Trust Fund shall not reimburse the Seller for any such
reimbursement to the Servicer.
(f)
The
Master Servicer and the Trustee shall have the right to examine the books,
records and other information of the Servicer, 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 written notice to the Servicer.
12
ARTICLE
III
SERVICING
OF THE MORTGAGE LOANS
Section
3.01 Servicer
to Service.
The
Servicer, as an independent contractor, shall service and administer the
Mortgage Loans from and after the Closing Date or Servicing Transfer Date,
as
applicable, and shall have full power and authority, acting alone, to do any
and
all things in connection with such servicing and administration which the
Servicer may deem necessary or desirable, consistent with the terms of this
Agreement and with Accepted Servicing Practices.
The
Seller, the Master Servicer and the Servicer additionally agree that the
Servicer will fully furnish, in accordance with the Fair Credit Reporting Act
of
1970, as amended (the “Fair Credit Reporting Act”) and its implementing
regulations, accurate and complete information (e.g., favorable and unfavorable)
on its borrower credit files to Equifax, Experian and Trans Union Credit
Information Company (three of the credit repositories), on a monthly basis.
The
Seller and the Servicer additionally agree as follows:
(a)
The
Servicer shall (i) record or cause to be recorded the Mortgage or the Assignment
of Mortgage, as applicable, with respect to all MERS Eligible Mortgage Loans,
in
the name of MERS, or shall ascertain that such have previously been so recorded;
(ii) with the cooperation of the Trustee, take such actions as are necessary
to
cause the Trustee to be clearly identified as the owner of each MERS Mortgage
Loan and each MERS Eligible Mortgage Loan on the records of MERS for purposes
of
the system of recording transfers of beneficial ownership of mortgages
maintained by MERS; (iii) prepare or cause to be prepared all Assignments of
Mortgage with respect to all Non-MERS Eligible Mortgage Loans; (iv) record
or
cause to be recorded, subject to Section 2.02(b) hereof, all Assignments of
Mortgage with respect to Non-MERS Mortgage Loans in the name of the Trustee;
(v)
pay the recording costs pursuant to Section 2.02 hereof; and/or (vi) track
such
Mortgages and Assignments of Mortgage to ensure they have been recorded. The
Servicer shall be entitled to be paid by the Seller fees for the preparation
and
recordation of the Mortgages and Assignments of Mortgage. After the expenses
of
such recording costs pursuant to Section 2.02 hereof shall have been paid by
the
Servicer, the Servicer shall submit to the Seller a reasonably detailed invoice
for reimbursement of recording costs and fees it incurred
hereunder.
(b)
If
applicable, the Servicer shall, in accordance with the relevant provisions
of
the ▇▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ National Affordable Housing Act of 1990, as the same
may
be amended from time to time, and the regulations provided in accordance with
the Real Estate Settlement Procedures Act, provide notice to the Mortgagor
of
each Mortgage Loan of the transfer of the servicing thereto to the
Servicer.
(c)
The
Servicer shall be responsible for the preparation of and costs associated with
notifications to Mortgagors of the assumption of servicing by the
Servicer.
13
Consistent
with the terms of this Agreement and except as provided in Section 3.19, the
Servicer may waive any late payment charge, assumption fee or other fee that
may
be collected in the ordinary course of servicing the Mortgage Loans. The
Servicer shall not make any future advances to any obligor under any Mortgage
Loan, and (unless the Mortgagor is in default with respect to the Mortgage
Loan
or such default is, in the judgment of the Servicer, reasonably foreseeable)
the
Servicer shall not permit any modification of any material term of any Mortgage
Loan, including any modification that would change the Mortgage Interest Rate,
defer or forgive the payment of principal or interest, reduce or increase the
outstanding principal balance (except for actual payments of principal) or
change the final maturity date on such Mortgage Loan. In the event of any such
modification which permits the deferral of interest or principal payments on
any
Mortgage Loan, the Servicer shall, on the Business Day immediately preceding
the
Remittance Date in any month in which any such principal or interest payment
has
been deferred, make a Monthly Advance in accordance with Section 4.03, in an
amount equal to the difference between (i) 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 (ii) the amount paid by the Mortgagor. The
Servicer shall be entitled to reimbursement for such advances to the same extent
as for all other advances made pursuant to Section 4.03. Without limiting the
generality of the foregoing, the Servicer shall continue, and is hereby
authorized and empowered, to execute and deliver on behalf of itself and the
Trustee, 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. Upon the request
of
the Servicer, the Trustee shall execute and deliver to the Servicer any powers
of attorney and other documents, furnished to it by the Servicer and reasonably
satisfactory to the Trustee, necessary or appropriate to enable the Servicer
to
carry out its servicing and administrative duties under this Agreement.
Notwithstanding anything contained herein to the contrary, the Servicer shall
not, without the Trustee’s written consent: (i) initiate any action suit or
proceeding solely under the Trustee’s name without indicating the Servicer’s
representative capacity; or (ii) take any action with the intent to cause,
and
that actually causes, the Trustee to be registered to do business in any state.
Promptly after the execution of any assumption, modification, consolidation
or
extension of any Mortgage Loan, the Servicer shall forward to the Master
Servicer copies of any documents evidencing such assumption, modification,
consolidation or extension. Notwithstanding anything to the contrary contained
in this Servicing Agreement, the Servicer shall not make or permit any
modification, waiver or amendment of any term of any Mortgage Loan that would
cause any REMIC created under the Pooling and Servicing Agreement to fail to
qualify as a REMIC or result in the imposition of any tax under Section 860F(a)
or Section 860G(d) of the Code.
Notwithstanding
anything to the contrary in this Agreement, the Servicer shall not (unless
the
Servicer determines, in its own discretion, that there exists a situation of
extreme hardship to the Mortgagor), waive any premium or penalty in connection
with a prepayment of principal of any Mortgage Loan, and shall not consent
to
the modification of any Mortgage Note to the extent that such modification
relates to payment of a prepayment premium or penalty.
In
servicing and administering the Mortgage Loans, the Servicer 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,
the ▇▇▇▇▇▇ ▇▇▇ Guides, and the Master Servicer’s and Seller’s reliance on the
Servicer.
14
Section
3.02 Collection
of Mortgage Loan Payments.
Continuously
from the Closing Date or Servicing Transfer Date, as applicable, until the
date
each Mortgage Loan ceases to be subject to this Agreement, the Servicer shall
proceed diligently to collect all payments due under each of the Mortgage Loans
when the same shall become due and payable and shall take special care in
ascertaining and estimating Escrow Payments and all other charges that will
become due and payable with respect to the Mortgage 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
3.03 Establishment
of and Deposits to Custodial Account.
The
Servicer shall segregate and hold all funds collected and received pursuant
to
the Mortgage Loans 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 as directed by the Master
Servicer. The Custodial Account shall be an Eligible Deposit Account established
with an Eligible Institution. Any funds deposited in the Custodial Account
may
be invested in Eligible Investments subject to the provisions of Section 3.11
hereof. Funds deposited in the Custodial Account may be drawn on by the Servicer
in accordance with Section 3.04. The creation of any Custodial Account shall
be
evidenced by a certification in the form of Exhibit B. A copy of such
certification shall be furnished to the Master Servicer and, upon request,
to
any subsequent owner of the Mortgage Loans.
The
Servicer shall deposit in the Custodial Account on a daily basis, and retain
therein, the following collections received by the Servicer and payments made
by
the Servicer after the Closing Date or Servicing Transfer Date, as
applicable:
(i)
all
payments on account of principal on the Mortgage Loans, including all Principal
Prepayments;
(ii)
all
payments on account of interest on the Mortgage Loans adjusted to the Mortgage
Loan Remittance Rate;
(iii)
all
Liquidation Proceeds;
(iv)
all
Insurance Proceeds (other than amounts applied to the restoration or repair
of
the Mortgaged Property or immediately released to the Mortgagor in accordance
with Accepted Servicing Practices);
(v)
all
Condemnation Proceeds that are not applied to the restoration or repair of
the
Mortgaged Property or released to the Mortgagor;
(vi)
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
made from the Servicer’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;
15
(vii)
all
Monthly Advances made by the Servicer pursuant to Section 4.03;
(viii)
any
amounts required to be deposited by the Servicer in connection with the
deductible clause in any blanket hazard insurance policy;
(ix)
any
amounts received with respect to or related to any REO Property or REO
Disposition Proceeds;
(x)
any
Prepayment Penalty Amounts; and
(xi)
any
other
amount required hereunder to be deposited by the Servicer in the Custodial
Account.
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 the Servicing Fee and Ancillary
Income need not be deposited by the Servicer into the Custodial
Account.
Any
interest paid on funds deposited in the Custodial Account by the depository
institution shall accrue to the benefit of the Servicer and the Servicer shall
be entitled to retain and withdraw such interest from the Custodial Account
pursuant to Section 3.04. Additionally, any other benefit derived from the
Custodial Account associated with the receipt, disbursement and accumulation
of
principal, interest, taxes, hazard insurance, mortgage insurance, etc. shall
accrue to the Servicer.
Section
3.04 Permitted
Withdrawals From Custodial Account.
The
Servicer shall, from time to time, withdraw funds from the Custodial Account
for
the following purposes:
(i)
to
make
payments to the Master Servicer in the amounts and in the manner provided for
in
Section 4.01;
(ii)
with
respect to each LPMI Loan, in the amount of the related LPMI Fee, to make
payments with respect to premiums for LPMI Policies in accordance with Section
3.07;
(iii)
in
the
event the Servicer has elected not to retain the Servicing Fee out of any
Mortgagor payments on account of interest or other recovery of interest with
respect to a particular Mortgage Loan (including late collections of interest
on
such Mortgage Loan, or interest portions of Insurance Proceeds, Condemnation
Proceeds or Liquidation Proceeds) prior to the deposit of such Mortgagor payment
or recovery in the Custodial Account, to pay to itself the related Servicing
Fee
from all such Mortgagor payments on account of interest or other such recovery
for interest with respect to that Mortgage Loan;
(iv)
to
pay
itself investment earnings on funds deposited in the Custodial
Account;
16
(v)
to
clear
and terminate the Custodial Account upon the termination of this Agreement;
(vi)
to
transfer funds to another Eligible Institution in accordance with Section 3.11
hereof;
(vii)
to
invest
funds in certain Eligible Investments in accordance with Section 3.11 hereof;
(viii)
to
reimburse itself to the extent of funds in the Custodial Account for Monthly
Advances of the Servicer’s funds made pursuant to Section 4.03, the Servicer's
right to reimburse itself pursuant to this subclause (viii) with respect to
any
Mortgage Loan being limited to amounts received on or in respect of the related
Mortgage Loan which represent late recoveries of payments of principal or
interest with respect to which a Monthly Advance was made, it being understood
that, in the case of any such reimbursement, the Servicer’s right thereto shall
be prior to the rights of the Trust Fund, provided,
however,
that
following the final liquidation of a Mortgage Loan, the Servicer may reimburse
itself for previously unreimbursed Monthly Advances in excess of Liquidation
Proceeds or Insurance Proceeds with respect to such Mortgage Loan from any
funds
in the Custodial Account, it being understood, in the case of any such
reimbursement, that the Servicer’s right thereto shall be prior to the rights of
the Trust Fund. The Servicer may recover at any time from amounts on deposit
in
the Custodial Account the amount of any Monthly Advances that the Servicer
deems
nonrecoverable or that remain unreimbursed to the Servicer from related
Liquidation Proceeds after the final liquidation of the Mortgage
Loan;
(ix)
to
reimburse itself for remaining unreimbursed Servicing Advances with respect
to
any defaulted Mortgage Loan as to which the Servicer has determined that all
amounts that it expects to recover on behalf of the Trust Fund from or on
account of such Mortgage Loan have been recovered;
(x)
to
reimburse itself for expenses incurred or reimbursable to the Servicer pursuant
to Sections 3.12 and 6.03 to the extent not previously reimbursed under clause
(viii) of this Section 3.04; and
(xi)
to
withdraw funds deposited in error.
Section
3.05 Establishment
of and Deposits to Escrow Account.
The
Servicer shall segregate and hold all funds collected and received pursuant
to a
Mortgage Loan constituting Escrow Payments separate and apart from any of its
own funds and general assets and shall establish and maintain one or more Escrow
Accounts, in the form of time deposit or demand accounts, titled as directed
by
the Master Servicer. Each Escrow Account shall be an Eligible Deposit Account
established with an Eligible Institution in a manner that shall provide maximum
available insurance thereunder. Funds deposited in the Escrow Account may be
drawn on by the Servicer in accordance with Section 3.06. The creation of any
Escrow Account shall be evidenced by a certification in the form of Exhibit
C. A
copy of such certification shall be furnished to the Master Servicer and, upon
request, to any subsequent owner of the Mortgage Loans.
17
The
Servicer shall deposit in the Escrow Account or Accounts on a daily basis,
and
retain therein:
(i)
all
Escrow Payments collected on account of the Mortgage Loans, for the purpose
of
effecting timely payment of any such items as required under the terms of this
Agreement; and
(ii)
all
amounts representing Insurance Proceeds or Condemnation Proceeds that are to
be
applied to the restoration or repair of any Mortgaged Property.
The
Servicer shall make withdrawals from the Escrow Account only to effect such
payments as are required under this Agreement, as set forth in Section 3.06.
The
Servicer shall 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. Additionally, any other benefit derived from
the Escrow Account associated with the receipt, disbursement and accumulation
of
principal, interest, taxes, hazard insurance, mortgage insurance, etc. shall
accrue to the Servicer. To the extent required by law, the Servicer 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
3.06 Permitted
Withdrawals From Escrow Account.
Withdrawals
from the Escrow Account or Accounts may be made by the Servicer
only:
(i)
to
effect
timely payments of ground rents, taxes, assessments, water rates, sewer rents,
mortgage insurance premiums, condominium charges, fire and hazard insurance
premiums or other items constituting Escrow Payments for the related
Mortgage;
(ii)
to
refund
to any Mortgagor any funds found to be in excess of the amounts required under
the terms of the related Mortgage Loan;
(iii)
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;
(iv)
to
reimburse the Servicer for any Servicing Advance made by the Servicer with
respect to a related Mortgage Loan, but only from amounts received on the
related Mortgage Loan which represent late collections of Escrow Payments;
(v)
for
application to restoration or repair of the Mortgaged Property in accordance
with the ▇▇▇▇▇▇ Mae Guides;
(vi)
to
pay to
the Servicer, or any Mortgagor to the extent required by law, any interest
paid
on the funds deposited in the Escrow Account;
(vii)
to
remove
funds inadvertently placed in the Escrow Account by the Servicer;
and
18
(viii)
to
clear
and terminate the Escrow Account on the termination of this
Agreement.
Section
3.07 Maintenance
of PMI Policy and/or LPMI Policy; Claims.
The
Servicer 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 Homeowners
Protection Act of 1998, and all regulations promulgated thereunder, as amended
from time to time.
With
respect to each Mortgage Loan (other than LPMI Loans) with a loan to value
ratio
at origination in excess of 80%, the Servicer 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 Servicer shall obtain from another
Qualified Insurer a comparable replacement policy, with a total coverage equal
to the remaining coverage of such terminated PMI Policy, at substantially the
same fee level. The Servicer shall not take any action which would result in
noncoverage under any applicable PMI Policy of any loss which, but for the
actions of the Servicer 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 Servicer shall promptly notify the insurer
under the related PMI Policy, if any, of such assumption or substitution of
liability in accordance with the terms of such PMI Policy and shall take all
actions which may be required by such insurer as a condition to the continuation
of coverage under such PMI Policy. If such PMI Policy is terminated as a result
of such assumption or substitution of liability, the Servicer shall obtain
a
replacement PMI Policy as provided above.
The
Servicer shall take all such actions as are necessary to service, maintain
and
administer the LPMI Loans in accordance with the LPMI Policy and to perform
and
enforce the rights of the insured under such LPMI Policy. Except as expressly
set forth herein, the Servicer shall have full authority on behalf of the Trust
Fund to do anything it reasonably deems appropriate or desirable in connection
with the servicing, maintenance and administration of the LPMI Policy. The
Servicer shall not modify or assume a Mortgage Loan covered by the LPMI Policy
or take any other action with respect to such Mortgage Loan which would result
in non-coverage under the LPMI Policy of any loss which, but for the actions
of
the Servicer, would have been covered thereunder. If the LPMI Insurer fails
to
pay a claim under the LPMI Policy as a result of breach by the Servicer of
its
obligations hereunder or under the LPMI Policy, the Servicer 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 right to reimbursement from the Trust Fund. The Servicer shall cooperate
with the LPMI Insurer and the Master Servicer and shall use its best efforts
to
furnish all reasonable aid, evidence and information in the possession of the
Servicer to which the Servicer has access with respect to any LPMI
Loan;
provided, however,
notwithstanding anything to the contrary contained in any LPMI Policy, the
Servicer shall not be required to submit any reports to the LPMI Insurer until
a
reporting date that is at least 15 days after the Servicer has received
sufficient loan level information from the Seller, the Master Servicer or the
LPMI Insurer to appropriately code its servicing system in accordance with
the
LPMI Insurer’s requirements.
19
In
connection with its activities as servicer, the Servicer agrees to prepare
and
present, on behalf of itself and the Trustee, claims to the 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 Servicer under any PMI
Policy or LPMI Policy shall be deposited in the Custodial Account, subject
to
withdrawal pursuant to Section 3.04.
Section
3.08 Fidelity
Bond and Errors and Omissions Insurance.
The
Servicer shall keep in force during the term of this Agreement a Fidelity Bond
and Errors and Omissions Insurance Policy. Such Fidelity Bond and Errors and
Omissions Insurance shall be maintained with recognized insurers and shall
be in
such form and amount as would permit the Servicer to be qualified as a ▇▇▇▇▇▇
▇▇▇ or ▇▇▇▇▇▇▇ Mac seller-servicer. The Servicer shall be deemed to have
complied with this provision if an affiliate of the Servicer has such errors
and
omissions and fidelity bond coverage and, by the terms of such insurance policy
or fidelity bond, the coverage afforded thereunder extends to the Servicer.
The
Servicer shall furnish to the Master Servicer or Trustee a copy of each such
bond and insurance policy if the Master Servicer or Trustee so
requests.
Section
3.09 Notification
of Adjustments.
With
respect to each Adjustable Rate Mortgage Loan, the Servicer shall adjust the
Mortgage Interest Rate on the related interest rate adjustment date and shall
adjust the Monthly Payment on the related mortgage payment adjustment date,
if
applicable, in compliance with the requirements of applicable law and the
related Mortgage and Mortgage Note. The Servicer 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 and
Monthly Payment adjustments. The Servicer shall promptly, upon written request
therefor, deliver to the Master Servicer such notifications and any additional
applicable data regarding such adjustments and the methods used to calculate
and
implement such adjustments. Upon the discovery by the Servicer or the receipt
of
notice from the Master Servicer that the Servicer has failed to adjust a
Mortgage Interest Rate or Monthly Payment in accordance with the terms of the
related Mortgage Note, the Servicer shall immediately deposit in the Custodial
Account from its own funds the amount of any interest loss or deferral caused
thereby.
Section
3.10 Completion
and Recordation of Assignments of Mortgage.
As
soon
as practicable after the Closing Date, the Servicing Transfer Date or the date
on which a Qualifying Substitute Mortgage Loan is delivered pursuant to Section
[___] of the Pooling and Servicing Agreement, as applicable (but in no event
more than 90 days thereafter except to the extent delays are caused by the
applicable public recording office), the Servicer shall cause the endorsements
on the Mortgage Note (if applicable), and the Assignments of Mortgage (subject
to Section 3.01(a)) to be completed in the name of the Trustee (or MERS, as
applicable).
20
Section
3.11 Protection
of Accounts.
The
Servicer may transfer the Custodial Account or any Escrow Account to a different
Eligible Institution from time to time; provided
that in
the event the Custodial Account or any Escrow Account is held in a depository
institution or trust company that ceases to be an Eligible Institution, the
Servicer shall transfer such Custodial Account or Escrow Account, as the case
may be, to an Eligible Institution. Such transfer shall be made only upon
obtaining the consent of the Master Servicer, which consent shall not be
withheld unreasonably.
The
Servicer shall bear any expenses, losses or damages sustained by the Master
Servicer or the Trustee if 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 Servicer be invested in Eligible Investments. Any such Eligible Investment
shall mature no later than the Business Day immediately preceding the related
Remittance Date; provided,
however,
that if
such Eligible Investment is an obligation of a Qualified Depository (other
than
the Servicer) that maintains the Custodial Account or the Escrow Account, then
such Eligible Investment may mature on the related Remittance Date. Any such
Eligible Investment shall be made in the name of the Servicer in trust for
the
benefit of the Trustee. All income on or gain realized from any such Eligible
Investment shall be for the benefit of the Servicer and may be withdrawn at
any
time by the Servicer. Any losses incurred in respect of any such investment
shall be deposited in the Custodial Account or the Escrow Account, by the
Servicer out of its own funds immediately as realized.
Section
3.12 Payment
of Taxes, Insurance and Other Charges.
With
respect to each Mortgage Loan, the Servicer shall maintain accurate records
reflecting the status of ground rents, taxes, assessments, water rates, sewer
rents, and other charges which are or may become a lien upon the Mortgaged
Property and the status of PMI Policy and LPMI Policy (if any) premiums and
fire
and hazard insurance coverage and shall obtain, from time to time, all bills
for
the payment of such charges (including renewal premiums) and shall effect
payment thereof prior to the applicable penalty or termination date, employing
for such purpose deposits of the Mortgagor in the Escrow Account which shall
have been estimated and accumulated by the Servicer in amounts sufficient for
such purposes, as allowed under the terms of the Mortgage. The Servicer shall
not be required to maintain records with respect to the payment of LPMI Premiums
unless the Servicer shall be required to make payment of such premiums and
such
requirement shall be indicated on the Mortgage Loan Schedule with respect to
each applicable Mortgage Loan. The Servicer assumes full responsibility for
the
timely payment of all such bills, 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 shall make advances from its
own
funds to effect such payments. With regard to any Mortgage Loans for which
the
Mortgagor is not required to escrow Escrow Payments with the Servicer, the
Servicer shall use reasonable efforts consistent with Accepted Servicing
Practices to determine that any such payments are made by the Mortgagor at
the
time they first became due and shall insure that the Mortgaged Property is
not
lost to a tax lien as a result of nonpayment and that such Mortgage is not
left
uninsured and shall make advances from its own funds to effect any such
delinquent payments to avoid the lapse of insurance coverage on the Mortgaged
Property or to avoid the imposition of a tax lien.
21
Section
3.13 Maintenance
of Hazard Insurance.
The
Servicer shall cause to be maintained for each Mortgage Loan hazard insurance
such that all buildings upon the Mortgaged Property are insured by a generally
acceptable insurer against loss by fire, hazards of extended coverage and such
other hazards as are customary in the area where the Mortgaged Property is
located, in an amount which is at least equal to the 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 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 Servicer determines in accordance
with applicable law and pursuant to the ▇▇▇▇▇▇ ▇▇▇ 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 Servicer shall notify the
related Mortgagor that the Mortgagor must obtain such flood insurance coverage,
and if said Mortgagor fails to obtain the required flood insurance coverage
within forty-five (45) days after such notification, the Servicer shall force
place the required flood insurance on the Mortgagor’s behalf.
Section
3.14 Maintenance
of Mortgage Blanket Insurance.
The
Servicer 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. To the extent such policy provides coverage in an amount equal
to the amount required pursuant to Section 3.12 and otherwise complies with
all
other requirements of Section 3.12, it shall conclusively be deemed to have
satisfied its obligations as set forth in Section 3.12. Any amounts collected
by
the Servicer 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 3.04 or 3.06. 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 3.12, and there
shall
have been a loss which would have been covered by such policy, the Servicer
shall deposit in the Custodial Account at the time of such loss the amount
not
otherwise payable under the blanket policy because of such deductible clause,
such amount to be deposited from the Servicer’s funds, without reimbursement
therefor.
22
Section
3.15 Restoration
of Mortgaged Property.
The
Servicer need not obtain the approval of the Trustee or the Master Servicer
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, with respect to claims greater than $10,000, the Servicer shall comply
with the following conditions in connection with any such release of Insurance
Proceeds or Condemnation Proceeds:
(i)
the
Servicer shall receive satisfactory independent verification of completion
of
repairs and issuance of any required approvals with respect thereto;
(ii)
the
Servicer shall take all steps necessary to preserve the priority of the lien
of
the Mortgage, including, but not limited to requiring waivers with respect
to
mechanics’ and materialmen’s liens; and
(iii)
pending
repairs or restoration, the Servicer shall place the Insurance Proceeds or
Condemnation Proceeds in the Escrow Account.
Section
3.16 Title,
Management and Disposition of REO Property.
In
the
event that title to any Mortgaged Property is acquired in foreclosure or by
deed
in lieu of foreclosure, the deed or certificate of sale shall be taken in the
name of the Trustee or its nominee (or MERS, as applicable), or in the event
the
Trustee 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 Servicer (with
a
copy delivered to the Trustee) 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 Trustee shall acknowledge in writing that such title
is being held as nominee for the Trustee.
The
Servicer shall manage, conserve, protect and operate each REO Property for
the
Trustee solely for the purpose of its prompt disposition and sale. The Servicer,
either itself or through an agent selected by the Servicer, shall manage,
conserve, protect and operate the REO Property in the same manner that it
manages, conserves, protects and operates other foreclosed property for its
own
account, and in the same manner that similar property in the same locality
as
the REO Property is managed. The Servicer shall attempt to sell the same (and
may temporarily rent the same for a period not greater than one year, except
as
otherwise provided below) on such terms and conditions as the Servicer deems
to
be in the best interest of the Trustee and the Trust Fund.
The
Servicer may permit an obligor to pay off a non-performing Mortgage Loan at
less
than its unpaid principal balance or chargeoff all or a portion of such
non-performing Mortgage Loan if such discounted payoff or chargeoff is in
accordance with Accepted Servicing Practices and the Servicer believes that
such
discounted payoff or chargeoff is in the best interest of the Trust Fund;
provided that in the case of any proposed discounted payoff or proposed
chargeoff, the Servicer shall notify the Master Servicer, by telecopy and
telephone, of the proposed discounted payoff or chargeoff of any Mortgage Loan.
The Master Servicer shall be deemed to have approved the discounted payoff
or
chargeoff of any Mortgage Loan unless the Master Servicer notifies the Servicer
in writing, within five (5) Business Days after its receipt of the related
notice, that it disapproves of the discounted payoff or chargeoff, in which
case
the Servicer shall not proceed with such discounted payoff or
chargeoff.
23
Notwithstanding
anything to the contrary contained in this Section 3.16, in connection with
a
foreclosure or acceptance of a deed in lieu of foreclosure, in the event the
Servicer has reasonable cause to believe that a Mortgaged Property is
contaminated by hazardous or toxic substances or wastes, or if the Trustee
or
the Master Servicer otherwise requests, an environmental inspection or review
of
such Mortgaged Property to be conducted by a qualified inspector shall be
arranged by the Servicer. Upon completion of the inspection, the Servicer shall
provide the Trustee and the Master Servicer 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 Servicer 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 whether or not the Mortgaged Property
is
contaminated by hazardous or toxic substances or wastes, the Servicer shall
not,
without the prior approval of the Master Servicer, proceed with foreclosure
or
acceptance of a deed in lieu of foreclosure. In such instance, the Master
Servicer shall be deemed to have approved such foreclosure or acceptance of
a
deed in lieu of foreclosure unless the Master Servicer notifies the Servicer
in
writing, within two (2) Business Days after its receipt of written notice of
the
proposed foreclosure or deed in lieu of foreclosure from the Servicer, that
it
disapproves of the related foreclosure or acceptance of a deed in lieu of
foreclosure. The Servicer shall be reimbursed for all Servicing Advances made
pursuant to this paragraph with respect to the related Mortgaged Property from
the Custodial Account.
Subject
to the approval of the Master Servicer as described in this paragraph, the
disposition of REO Property shall be carried out by the Servicer at such price,
and upon such terms and conditions, as the Servicer deems to be in the best
interests of the Trust Fund. Prior to acceptance by the Servicer of an offer
to
sell any REO Property, the Servicer shall notify the Master Servicer of such
offer in writing which notification shall set forth all material terms of said
offer (each, a “Notice of Sale”). The Master Servicer shall be deemed to have
approved the sale of any REO Property unless the Master Servicer notifies the
Servicer in writing, within two (2) Business Days after its receipt of the
related Notice of Sale, that it disapproves of the related sale, in which case
the Servicer shall not proceed with the sale. With respect to any REO Property,
upon a REO Disposition, the Servicer shall be entitled to retain from REO
Disposition Proceeds a disposition fee equal to $[____].
In
the
event that the Trust Fund acquires any REO Property in connection with a default
or imminent default on a Mortgage Loan, the Servicer shall dispose of such
REO
Property not later than the end of the third taxable year after the year of
its
acquisition by the Trust Fund unless the Servicer has applied for and received
a
grant of extension from the Internal Revenue Service to the effect that, under
the REMIC Provisions and any relevant proposed legislation and under applicable
state law, the applicable Trust REMIC may hold REO Property for a longer period
without adversely affecting the REMIC status of such REMIC or causing the
imposition of a federal or state tax upon such REMIC. If the Servicer has
received such an extension, then the Servicer shall continue to attempt to
sell
the REO Property for its fair market value for such period longer than three
years as such extension permits (the “Extended Period”). If the Servicer has not
received such an extension and the Servicer is unable to sell the REO Property
within the period ending 3 months before the end of such third taxable year
after its acquisition by the Trust Fund or if the Servicer has received such
an
extension, and the Servicer is unable to sell the REO Property within the period
ending three months before the close of the Extended Period, the Servicer shall,
before the end of the three-year period or the Extended Period, as applicable,
(i) purchase such REO Property at a price equal to the REO Property’s fair
market value or (ii) auction the REO Property to the highest bidder (which
may
be the Servicer) in an auction reasonably designed to produce a fair price
prior
to the expiration of the three-year period or the Extended Period, as the case
may be. The Trustee shall sign any document or take any other action reasonably
requested by the Servicer which would enable the Servicer, on behalf of the
Trust Fund, to request such grant of extension.
24
Notwithstanding
any other provisions of this Agreement, no REO Property acquired by the Trust
Fund shall be rented (or allowed to continue to be rented) or otherwise used
by
or on behalf of the Trust Fund in such a manner or pursuant to any terms that
would: (i) cause such REO Property to fail to qualify as “foreclosure property”
within the meaning of Section 860G(a)(8) of the Code; or (ii) subject any Trust
REMIC to the imposition of any federal income taxes on the income earned from
such REO Property, including any taxes imposed by reason of Sections 860F or
860G(c) of the Code, unless the Servicer has agreed to indemnify and hold
harmless the Trust Fund with respect to the imposition of any such
taxes.
The
Servicer shall also maintain on each REO Property fire and hazard insurance
with
extended coverage in amount which is at least equal to the maximum insurable
value of the improvements which are a part of such property, liability insurance
and, to the extent required and available under the Flood Disaster Protection
Act of 1973, as amended, flood insurance in the amount required
above.
The
Servicer shall withdraw from the Custodial Account funds necessary for the
proper operation, management and maintenance of the REO Property, including
the
cost of maintaining any hazard insurance pursuant to the ▇▇▇▇▇▇ ▇▇▇ Guides.
The
Servicer shall make monthly distributions on each Remittance Date to the Master
Servicer 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
3.16 and of any reserves reasonably required from time to time to be maintained
to satisfy anticipated liabilities for such expenses).
If
the
Servicer determines that, in accordance with Accepted Servicing Practices,
it is
in the best interest of the Trustee or the Trust Fund not to proceed with
foreclosure or accept a deed in lieu of foreclosure, the Servicer shall have
the
right to do so with the consent of the Master Servicer, whereupon the related
Mortgage Loan shall be deemed to be finally liquidated and the Servicer shall
have the right to release the lien of the Mortgage on the related Mortgaged
Property and the Servicer shall be entitled to reimbursement for all outstanding
unreimbursed Monthly Advances and Servicing Advances from the Custodial Account
in accordance with Sections 3.04(viii) and (ix).
25
Section
3.17 Real
Estate Owned Reports.
Together
with the statement furnished pursuant to Section 4.02, the Servicer shall
furnish to the Master Servicer on or before the Remittance Date each month
a
statement with respect to any REO Property covering the operation of such REO
Property for the previous month and the Servicer’s efforts in connection with
the sale of such REO Property and any rental of such REO Property incidental
to
the sale thereof for the previous month. That statement shall be accompanied
by
such other information as the Master Servicer shall reasonably
request.
Section
3.18 MERS.
(a)
The
Servicer shall use its Best Efforts to cause the Trustee to be identified as
the
owner of each MERS Mortgage Loan on the records of MERS for purposes of the
system of recording transfers of beneficial ownership of mortgages maintained
by
MERS.
(b)
The
Servicer shall maintain in good standing its membership in MERS. In addition,
the Servicer shall comply with all rules, policies and procedures of MERS,
including the Rules of Membership, as amended, and the MERS Procedures Manual,
as amended.
(c)
With
respect to all MERS Mortgage Loans serviced hereunder, the Servicer shall
promptly notify MERS as to any transfer of beneficial ownership of such Mortgage
Loans of which the Servicer has notice.
(d)
With
respect to all MERS Mortgage Loans serviced hereunder, the Servicer shall notify
MERS as to any transfer of servicing pursuant to Section 3.15 or Section 9.01
within 10 Business Days of such transfer of servicing. The Servicer shall
cooperate with the Trustee, the Master Servicer and any successor servicer
to
the extent necessary to ensure that such transfer of servicing is appropriately
reflected on the MERS system.
Section
3.19 Waiver
of Prepayment Penalty Amounts.
Except
as
provided below, the Servicer or any designee of the Servicer shall not waive
any
Prepayment Penalty Amount with respect to any Mortgage Loan. If the Servicer
or
its designee fails to collect a Prepayment Penalty Amount at the time of the
related prepayment of any Mortgage Loan subject to such Prepayment Penalty
Amount, the Servicer shall pay to the Trust Fund at such time (by deposit to
the
Custodial Account) an amount equal to the amount of the Prepayment Penalty
Amount not collected; provided,
however,
the
Servicer shall not have any obligation to pay the amount of any uncollected
Prepayment Penalty Amount under this Section 3.19 if the failure to collect
such
amount is the result of inaccurate or incomplete information in the Prepayment
Penalty Amount Schedule provided by the Seller and which is included as part
of
the Mortgage Loan Schedule attached hereto as Exhibit A. The Prepayment Penalty
Amounts listed on the Prepayment Penalty Amount Schedule attached hereto as
Exhibit A are complete, true and accurate and may be relied on by the Servicer
in its calculation of Prepayment Penalty Amounts. If the Prepayment Penalty
Amount data set forth on Exhibit A is incorrect, then the Servicer shall have
no
liability for any loss resulting from calculation of Prepayment Penalty Amounts
using the data provided. Notwithstanding the above, the Servicer or its designee
may waive a Prepayment Penalty Amount without paying to the Trust Fund the
amount of such Prepayment Penalty Amount only if such Prepayment Penalty Amount
(i) relates to a defaulted Mortgage Loan or a reasonably foreseeable default,
such waiver is standard and customary in servicing similar mortgage loans to
the
Mortgage Loan, and such waiver, in the reasonable judgment of the Servicer
would
maximize recovery of total proceeds from the Mortgage Loan, taking into account
the amount of such Prepayment Charge and the related Mortgage Loan, or (ii)
relates to a prepayment charge the collection of which, if collected, would
be a
violation of applicable laws.
26
Section
3.20 Safeguarding
Customer Information.
The
Servicer 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
Servicer shall promptly provide the Master Servicer and the Trustee information
reasonably available to it regarding such security measures upon the reasonable
request of the Master Servicer and the Trustee which information shall include,
but not be limited to, any Statement on Auditing Standards (SAS) No. 70 report
covering the Servicer’s operations, and any other audit reports, summaries of
test results or equivalent measures taken by the Servicer with respect to its
security measures to the extent reasonably necessary in order for the Seller
to
satisfy its obligations under the Guidelines.
ARTICLE
IV
PAYMENTS
TO MASTER SERVICER
Section
4.01 Remittances.
On
each
Remittance Date the Servicer shall remit by wire transfer of immediately
available funds to the Master Servicer (i) 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 3.04), plus (ii) all Monthly Advances, if any, which the
Servicer is obligated to make pursuant to Section 4.03, minus (iii) any amounts
attributable to Principal Prepayments, Liquidation Proceeds, Insurance Proceeds,
Condemnation Proceeds or REO Disposition Proceeds received after the applicable
Prepayment Period, which amounts shall be remitted on the following Remittance
Date, together with any additional interest required to be deposited in the
Custodial Account in connection with such Principal Prepayment in accordance
with Section 3.03(vi), and minus (iv)
any
amounts attributable to Monthly Payments collected but due on a Due Date or
Due
Dates subsequent to the first day of the month in which such Remittance Date
occurs, 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 Master Servicer after the Business
Day
on which such payment was due, the Servicer shall pay to the Master Servicer
interest on any such late payment at an annual rate equal to the Prime Rate,
adjusted as of the date of each change, plus two (2) 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 Servicer on the
date
such late payment is made and shall cover the period commencing with the day
following such 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
Servicer of any such interest shall not be deemed an extension of time for
payment or a waiver of any Event of Default by the Servicer.
27
All
remittances required to be made to the Master Servicer shall be made to the
following wire account or to such other account as may be specified by the
Master Servicer from time to time:
[_______________]
[_______________]
[_______________]
[_______________]
[_______________]
Section
4.02 Statements
to Master Servicer.
Not
later
than the tenth calendar day of each month (or if such calendar day is not a
Business Day, the immediately preceding Business Day), the Servicer shall
furnish to the Master Servicer (i) a monthly remittance advice in the format
set
forth in Exhibit D-1 hereto and a monthly default loan report in the format
set
forth in Exhibit D-2 hereto (or in such other format mutually agreed between
the
Servicer and the Master Servicer) relating to the period ending on the last
day
of the preceding calendar month and (ii) all such information required pursuant
to clause (i) above on a magnetic tape or other similar media reasonably
acceptable to the Master Servicer. The Servicer shall include in the monthly
remittance advice information regarding each Employee Mortgage Loan. The format
of this monthly reporting may be amended from time to time to the extent
necessary to comply with applicable law or the terms of the Pooling and
Servicing Agreement.
Not
later
than the seventeenth day of each month, the Servicer shall furnish to the Master
Servicer (a) a monthly payoff remittance advice regarding any Principal
Prepayments in full applied to the related Mortgage Loan on or after the
seventeenth day of the month preceding the month of such reporting date, but
on
or before the sixteenth day of the month of such reporting date, containing
such
information and in such format as is mutually acceptable to the Master Servicer
and the Servicer, and in any event containing sufficient information to permit
the Master Servicer to properly report Principal Prepayment in full information
to the Trustee under the Pooling and Servicing Agreement and (b) all such
information required pursuant to clause (a) above in electronic format, on
magnetic tape or other similar media reasonably acceptable to the Master
Servicer.
In
addition, no later than March 15 of each calendar year, commencing March 15,
20[__], the Servicer shall furnish to each Person who was an owner of the
Mortgage Loans at any time during such calendar year as required by applicable
law or if not required by applicable law, at the request of such owner as to
the
aggregate of remittances for the applicable portion of such year.
28
The
Master Servicer may request that the Servicer provide, at the Master Servicer’s
expense, an appraisal or a broker price opinion on any Mortgage Loan which
is 90
days or more delinquent. The Servicer shall use its best efforts to deliver
such
appraisal or broker price opinion to the Master Servicer within 15 calendar
days
after such request.
Such
obligation of the Servicer shall be deemed to have been satisfied to the extent
that substantially comparable information shall be provided by the Servicer
pursuant to any requirements of the Internal Revenue Code as from time to time
are in force.
Beginning
with calendar year 20[__], the Servicer shall provide the Master Servicer with
such information concerning the Mortgage Loans as is necessary for the Master
Servicer or the Trustee to prepare the Trust Fund’s federal income tax return as
the Master Servicer or the Trustee may reasonably request from time to
time.
The
Servicer shall promptly notify the Securities Administrator, the Master Servicer
and the Depositor (i) of any legal proceedings pending against the Servicer
of
the type described in Item 1117 (§
229.1117) of
Regulation AB and (ii) if the Servicer shall become (but only to the extent
not
previously disclosed to the Securities Administrator, the Master Servicer and
the Depositor) at any time an affiliate of any of the Sponsor, the Trustee,
the
Master Servicer, another Servicer, the Securities Administrator, any Originator
contemplated by Item 1110 (§
229.1110) of
Regulation AB, any significant obligor contemplated by Item 1112 (§
229.1112) of
Regulation AB, any enhancement or support provider contemplated by Items 1114
or
1115 (§§
229.1114-1115) of
Regulation AB or any other material party to the Trust Fund contemplated by
Item
1100(d)(1) (§
229.1100(d)(1)) of
Regulation AB.
Section
4.03 Monthly
Advances by Servicer.
On
the
Business Day immediately preceding each Remittance Date, the Servicer shall
deposit in the Custodial Account from its own funds or from amounts held for
future distribution, or both, an amount equal to the aggregate of all Monthly
Advances relating to Monthly Payments 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 3.01. The Servicer’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 unless
the
Servicer deems such Monthly Advances to be unrecoverable, as evidenced by an
Officer’s Certificate of the Servicer delivered to the Master
Servicer.
29
ARTICLE
V
GENERAL
SERVICING PROCEDURES
Section
5.01 Servicing
Compensation.
As
consideration for servicing the Mortgage Loans subject to this Agreement, the
Servicer shall retain (i) the relevant Servicing Fee for each Mortgage Loan
remaining subject to this Agreement during any month and (ii) Ancillary Income.
In addition, if at any time the Servicer is the Retained Interest Holder with
respect to any Mortgage Loans, then the Servicer, as the Retained Interest
Holder, shall retain an amount equal to the Retained Interest relating to such
Mortgage Loans; provided, that (i) the Trustee and the Master Servicer shall
have no obligation to make payment of the Retained Interest to the Servicer
and
(ii) the Servicer’s right to retain the Retained Interest is limited to (and the
Retained Interest may only be retained from) the interest portion (including
recoveries with respect to interest from Liquidation Proceeds to the extent
permitted by Section 3.04 of this Agreement) of the Monthly Payments collected
by the Servicer with respect to those Mortgage Loans for which payment is in
fact made of the entire amount of the Monthly Payment. The Servicing Fee shall
be payable monthly. The Servicing Fees shall be payable only at the time of
and
with respect to those Mortgage Loans for which payment is in fact made of the
entire amount of the Monthly Payment or as otherwise provided in Section 3.04.
The obligation of the Trust Fund (if any) to pay the Servicing Fees is limited
as provided in Section 3.04. The aggregate of the Servicing Fees payable to
the
Servicer for any month with respect to the Mortgage Loans shall be reduced
by
any Prepayment Interest Shortfall Amount with respect to such month. Any
Prepayment Interest Excess Amount shall be retained by, or paid to, the Servicer
as a part of the Servicing Fee.
The
Servicer shall be required to pay all expenses incurred by it in connection
with
its servicing activities hereunder and shall not be entitled to reimbursement
thereof except as specifically provided for herein.
Section
5.02 Annual
Audit Report.
On
or
before March 1st of each year, beginning with March 1, 20[__], the Servicer
shall, at its own expense, cause a firm of independent public accountants (who
may also render other services to Servicer), which is a member of the American
Institute of Certified Public Accountants, to furnish to the Seller, the
Trustee, the Depositor and the Master Servicer (i) year-end audited (if
available) financial statements of the Servicer and (ii) a report to the effect
that such firm that attests to, and reports on, the assessment made by such
asserting party pursuant to Section 5.04 below, which report shall be made
in
accordance with standards for attestation engagements issued or adopted by
the
Public Company Accounting Oversight Board.
Section
5.03 Annual
Officer’s Certificate.
(a)
On
or
before March 1st of each year, beginning with March 1, 20[__], the Servicer,
at
its own expense, will deliver to the Seller, the Depositor, the Trustee and
the
Master Servicer (i) with respect to the period ending on the immediately
preceding December 31, a Servicing Officer’s certificate stating, as to each
signer thereof, that (1) a review of the activities of the Servicer during
such
preceding calendar year or portion thereof and of its performance under this
Agreement has been made under such Servicing Officer’s supervision and (2) to
the best of such officers’ knowledge, based on such review, the Servicer has
fulfilled all of its obligations under this Agreement in all material respects
throughout such year, or, if there has been a failure to fulfill any such
obligation in any material respect, specifying each such failure known to such
Servicing Officer’s and the nature and status thereof including the steps being
taken by the Servicer to remedy such default and/or (ii) such other certificates
as may be required under Item
1123
(§
229.1123) of
Regulation AB
or other
applicable law or regulation.
30
(b)
For
so
long as a certificate under the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002, as amended,
(“▇▇▇▇▇▇▇▇-▇▇▇▇▇”) is required to be given on behalf of the Trust Fund, no later
than March 1st of each year (or if not a Business Day, the immediately preceding
Business Day), beginning with March 1, 20[__], or at any other time that the
Master Servicer or the Depositor provides a certification pursuant to
▇▇▇▇▇▇▇▇-▇▇▇▇▇ and upon thirty (30) days’ written request of such parties, a
Servicing Officer shall execute and deliver an Officer’s Certificate to the
Master Servicer, the Trustee and the Depositor for the benefit of the Trust
Fund, the Master Servicer and the Depositor and their officers, directors and
affiliates, in the form of Exhibit E hereto or as may be required by applicable
law or regulation.
(c) The
Servicer shall indemnify and hold harmless the Master Servicer, the Depositor
and their respective officers, directors, agents and affiliates from and against
any losses, damages, penalties, fines, forfeitures, reasonable legal fees and
related costs, judgments and other costs and expenses arising out of or based
upon a breach by the Servicer or any of its officers, directors, agents or
affiliates of its obligations under this Section 5.03 or the negligence, bad
faith or willful misconduct of the Servicer in connection therewith. If the
indemnification provided for herein is unavailable or insufficient to hold
harmless the Master Servicer and/or the Depositor, then the Servicer agrees
that
it shall contribute to the amount paid or payable by the Master Servicer and/or
the Depositor as a result of the losses, claims, damages or liabilities of
the
Master Servicer and/or the Depositor in such proportion as is appropriate to
reflect the relative fault of the Master Servicer and/or the Depositor on the
one hand and the Servicer on the other in connection with a breach of the
Servicer’s obligations under this Section 5.03 or the Servicer’s negligence, bad
faith or willful misconduct in connection therewith.
Section
5.04 Compliance
with Applicable Servicing Criteria.
On
or
before March 1 of each calendar year, the Servicer shall deliver to the Trustee,
the Master Servicer and the Depositor a report regarding its assessment of
compliance with the servicing criteria specified in paragraph (d) of Item 1122
of Regulation AB (§ 229.1122(d)), as of and for the period ending the end of the
fiscal year ending no later than December 31 of the year prior to the year
of
delivery of the report, with respect to asset-backed security transactions
taken
as a whole in which the Servicer is performing any of the servicing criteria
specified in paragraph (d) of Item 1122 of Regulation AB (§ 229.1122(d)) that it
is performing pursuant to its obligations under this Agreement, and that are
backed by the same asset type backing such asset-backed securities. Each such
report shall include all of the statements required under paragraph (a) of
Item
1122 of Regulation AB (§ 229.1122(a)).
31
Section
5.05 Transfers
of Mortgaged Property.
The
Servicer shall use its best efforts to enforce any “due-on-sale” provision
contained in any Mortgage or Mortgage Note and to deny assumption by the person
to whom the Mortgaged Property has been or is about to be sold whether by
absolute conveyance or by contract of sale, and whether or not the Mortgagor
remains liable on the Mortgage and the Mortgage Note; provided that, if in
the
Servicer's prudent business judgment, it determines that an assumption of the
Mortgage Loan is in the best interests of the Trust Fund, it shall deliver
notice of such determination to the Master Servicer and may permit such
assumption if approved by the Master Servicer. When the Mortgaged Property
has
been conveyed by the Mortgagor, the Servicer shall, to the extent it has
knowledge of such conveyance, so long as the Master Servicer has not consented
to an assumption in accordance with the preceding sentence, exercise its rights
to accelerate the maturity of such Mortgage Loan under the “due-on-sale” clause
applicable thereto, provided, however, that the Servicer shall not be required
to take such action if the Servicer, in its prudent business judgment, believes
it is not in the best interests of the Trust Fund and 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
or
LPMI Policy, if any.
If
the
Servicer reasonably believes it is unable under applicable law to enforce such
“due-on-sale” clause or if the Master Servicer approves such assumption pursuant
to the preceding paragraph, the Servicer shall enter into (i) an assumption
and
modification agreement with the person to whom such property has been conveyed,
pursuant to which such person becomes liable under the Mortgage Note and the
original Mortgagor remains liable thereon or (ii) in the event the Servicer
is
unable under applicable law to require that the original Mortgagor remain liable
under the Mortgage Note and the Servicer has the prior consent of the primary
mortgage guaranty insurer, a substitution of liability agreement with the owner
of the Mortgaged Property pursuant to which the original Mortgagor is released
from liability and the owner of the Mortgaged Property is substituted as
Mortgagor and becomes liable under the Mortgage Note; provided that no such
substitutions should be permitted unless such person satisfies the underwriting
criteria of the Servicer and has a credit risk rating at least equal to that
of
the original Mortgagor. The Mortgage Loan, as assumed, shall conform in all
respects to the requirements, representations and warranties of this Agreement.
The Servicer shall notify the Master Servicer that any such assumption or
substitution agreement has been contemplated by forwarding to the Master
Servicer a copy of such assumption or substitution agreement (indicating the
Mortgage File to which it relates). The Servicer shall forward an original
copy
of such agreement to the Custodian to be held by the Custodian with the other
documents related to such Mortgage Loan. The Servicer shall be responsible
for
recording any such assumption or substitution agreements. In connection with
any
such assumption or substitution agreement, the Monthly Payment on the related
Mortgage Loan shall not be changed but shall remain as in effect immediately
prior to the assumption or substitution, the Mortgage Interest Rate, the stated
maturity or the outstanding principal amount of such Mortgage Loan shall not
be
changed nor shall any required monthly payments of principal or interest be
deferred or forgiven. Any assumption fee collected by the Servicer for entering
into an assumption agreement shall be retained by the Servicer as additional
servicing compensation. In connection with any such assumption, none of the
Mortgage Interest Rate borne by the related Mortgage Note, the term of the
Mortgage Loan or the outstanding principal amount of the Mortgage Loan shall
be
changed.
32
ARTICLE
VI
REPRESENTATIONS,
WARRANTIES
AND
AGREEMENTS
Section
6.01 Representations,
Warranties and Agreements of the Servicer.
The
Servicer, as a condition to the consummation of the transactions contemplated
hereby, hereby makes the following representations and warranties to the Seller,
the Master Servicer and the Trustee as of the Closing Date:
(a)
Due
Organization and Authority.
[The
Servicer is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware 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 Servicer, and in any event the Servicer is in compliance
with the laws of any such state to the extent necessary to ensure the
enforceability of the terms of this Agreement; the Servicer has the full 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
Servicer 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 Servicer and all requisite action has been taken
by the Servicer to make this Agreement valid and binding upon the Servicer
in
accordance with its terms;] [May vary in accordance with
transaction.]
(b)
Ordinary
Course of Business.
The
consummation of the transactions contemplated by this Agreement are in the
ordinary course of business of the Servicer;
(c)
No
Conflicts.
Neither
the execution and delivery of this Agreement, the acquisition of the servicing
responsibilities by the Servicer 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 Servicer’s organizational documents or any legal
restriction or any agreement or instrument to which the Servicer is now a party
or by which it is bound, or constitute a default or result in an acceleration
under any of the foregoing, or result in the violation of any law, rule,
regulation, order, judgment or decree to which the Servicer or its property
is
subject, or impair the ability of the Servicer to service the Mortgage Loans,
or
impair the value of the Mortgage Loans;
(d)
Ability
to Perform.
The
Servicer does not believe, nor does it have any reason or cause to believe,
that
it cannot perform each and every covenant contained in this
Agreement;
(e)
No
Litigation Pending.
There
is no action, suit, proceeding or investigation pending or threatened against
the Servicer 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 Servicer, or in any material impairment of the
right
or ability of the Servicer to carry on its business substantially as now
conducted, or in any material liability on the part of the Servicer, or which
would draw into question the validity of this Agreement or of any action taken
or to be taken in connection with the obligations of the Servicer contemplated
herein, or which would be likely to impair materially the ability of the
Servicer to perform under the terms of this Agreement;
33
(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 Servicer
of
or compliance by the Servicer with this Agreement;
(g)
Ability
to Service.
The
Servicer is an approved seller/servicer of conventional residential mortgage
loans for ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, with the facilities, procedures and
experienced personnel necessary for the sound servicing of mortgage loans of
the
same type as the Mortgage Loans. The Servicer is in good standing to service
mortgage loans for either ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac. The Servicer is a member
in
good standing of the MERS system;
(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)
No
Commissions to Third Parties.
The
Servicer 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 Seller; and
(j)
Fair
Credit Reporting Act.
The
Servicer for each mortgage loan has
fully
furnished, in accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (e.g., favorable and unfavorable)
on its borrower credit files to Equifax, Experian and Trans Union Credit
Information Company (three of the credit repositories), on a monthly
basis.
Section
6.02 Remedies
for Breach of Representations and Warranties of the Servicer.
It
is
understood and agreed that the representations and warranties set forth in
Section 6.01 shall survive the engagement of the Servicer to perform the
servicing responsibilities as of the Closing Date or Servicing Transfer Date,
as
applicable, hereunder and the delivery of the Servicing Files to the Servicer
and shall inure to the benefit of the Seller and the Trustee. Upon discovery
by
either the Servicer, the Master Servicer or the Seller of a breach of any of
the
foregoing representations and warranties which materially and adversely affects
the ability of the Servicer to perform its duties and obligations under this
Agreement or otherwise materially and adversely affects the value of the
Mortgage Loans, the Mortgaged Property or the priority of the security interest
on such Mortgaged Property or the interest of the Seller or the Trustee, the
party discovering such breach shall give prompt written notice to the
other.
Within
60
days of the earlier of either discovery by or notice to the Servicer of any
breach of a representation or warranty set forth in Section 6.01 which
materially and adversely affects the ability of the Servicer to perform its
duties and obligations under this Agreement or otherwise materially and
adversely affects the value of the Mortgage Loans, the Mortgaged Property or
the
priority of the security interest on such Mortgaged Property, the Servicer
shall
use its Best Efforts promptly to cure such breach in all material respects
and,
if such breach cannot be cured, the Servicer shall, at the Trustee’s or the
Master Servicer’s option, assign the Servicer’s rights and obligations under
this Agreement (or respecting the affected Mortgage Loans) to a successor
Servicer. Such assignment shall be made in accordance with Sections 9.01 and
9.02.
34
In
addition, the Servicer shall indemnify the Seller, the Trustee and the Master
Servicer (and each of their respective directors, officers, employees and
agents) and the Trust Fund, and hold each of them harmless against any Costs
resulting from any claim, demand, defense or assertion based on or grounded
upon, or resulting from, a breach of the Servicer representations and warranties
contained in this Agreement. It is understood and agreed that the remedies
set
forth in this Section 6.02 constitute the sole remedies of the Seller, the
Master Servicer and the Trustee respecting a breach of the foregoing
representations and warranties.
Any
cause
of action against the Servicer relating to or arising out of the breach of
any
representations and warranties made in Section 6.01 shall accrue upon (i)
discovery of such breach by the Servicer or notice thereof by the Seller or
the
Master Servicer to the Servicer, (ii) failure by the Servicer to cure such
breach within the applicable cure period, and (iii) demand upon the Servicer
by
the Seller or the Master Servicer for compliance with this
Agreement.
Section
6.03 Additional
Indemnification by the Servicer; Third Party Claims.
The
Servicer shall indemnify the Seller, the Depositor, the Trustee and the Master
Servicer (and each of their respective directors, officers, employees and
agents) and the Trust Fund, and hold them harmless against any and all Costs
that any such indemnified party may sustain in any way related to (i) the
failure of the Servicer to perform its duties and service the Mortgage Loans
in
material compliance with the terms of this Agreement (including, but not limited
to its obligation to provide any certification pursuant to Sections 5.03(b)
and
5.04 hereunder) or for any inaccurate or misleading information provided in
the
certifications required pursuant to Sections 5.03(b) and 5.04 or (ii) the
failure of the Servicer to cause any event to occur or not to occur which would
have occurred or would not have occurred, as applicable, if the Servicer were
applying Accepted Servicing Practices under this Agreement. The Servicer shall
immediately notify the Seller, the Depositor, the Master Servicer, the Trustee
or any other relevant party if a claim is made by a third party with respect
to
this Agreement or the Mortgage Loans, assume (with the prior written consent
of
the indemnified party in the event of an indemnified claim) 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 any other party in respect of such claim and follow any written
instructions received from such indemnifying party in connection with such
claim. Subject to the Servicer’s indemnification pursuant to Section 6.02, or
the failure of the Servicer to service and administer the Mortgage Loans in
material compliance with the terms of this Agreement, the Trust Fund shall
indemnify the Servicer and hold the Servicer harmless against any and all Costs
that the Servicer may sustain in connection with any legal action relating
to
this Agreement, the Certificates or the origination or Servicing of the Mortgage
Loans by any prior owner or servicer, other than any Costs incurred by reason
of
the Servicer’s willful misfeasance, bad faith or negligence in the performance
of duties hereunder or by reason of its reckless disregard of obligations and
duties hereunder.
35
Section
6.04 [Reserved].
Section
6.05 Indemnification
with Respect to Certain Taxes and Loss of REMIC Status.
In
the
event that any REMIC fails to qualify as a REMIC, loses its status as a REMIC,
or incurs federal, state or local taxes as a result of a prohibited transaction
or prohibited contribution under the REMIC Provisions due to the negligent
performance by the Servicer of its duties and obligations set forth herein,
the
Servicer shall indemnify the Holder of the related Residual Certificate, the
Master Servicer, the Trustee and the Trust Fund (and each of their respective
directors, officers, employees and agents) against any and all losses, claims,
damages, liabilities or expenses (“Losses”) resulting from such negligence;
provided,
however,
that the
Servicer shall not be liable for any such Losses attributable to the action
or
inaction of the Trustee, the Depositor or the Holder of such Residual
Certificate, as applicable, nor for any such Losses resulting from
misinformation provided by the Holder of such Residual Certificate on which
the
Servicer has relied. The foregoing shall not be deemed to limit or restrict
the
rights and remedies of the Holder of such Residual Certificate, the Trustee
and
the Trust Fund now or hereafter existing at law or in equity or otherwise.
Notwithstanding the foregoing, however, in no event shall the Servicer have
any
liability (1) for any action or omission that is taken in accordance with and
in
compliance with the express terms of, or which is expressly permitted by the
terms of, this Agreement, (2) for any Losses other than arising out of a
negligent performance by the Servicer of its duties and obligations set forth
herein, and (3) for any special or consequential damages to Certificateholders
(in addition to payment of principal and interest on the
Certificates).
Section
6.06 Reporting
Requirements of the Commission and Indemnification.
Notwithstanding
any other provision of this Agreement, the Servicer shall (i) agree to such
modifications and enter into such amendments to this Agreement as may be
necessary, in the judgment of the Depositor, the Master Servicer and their
respective counsel, to comply with any rules promulgated by the U.S. Securities
and Exchange Commission (the “Commission”) and any interpretations thereof by
the staff of the Commission (collectively, “SEC Rules”) and (ii) promptly upon
request provide to the Depositor for inclusion in any periodic report required
to be filed under the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), such items of information regarding this Agreement and matters related to
the Servicer, including as applicable (by way of example and not limitation),
a
description of any material litigation or governmental action or proceeding
involving the Servicer or its affiliates (collectively, the “Servicer
Information”), provided,
that
such
information shall be required to be provided by the Servicer only to the extent
that such shall be determined by the Depositor in its sole discretion and its
counsel to be necessary or advisable to comply with any SEC Rules.
The
Servicer
hereby
agrees to indemnify and hold harmless the Depositor, the Master Servicer, their
respective officers and directors and each person, if any, who controls the
Depositor or Master Servicer within the meaning of Section 15 of the Securities
Act of 1933, as amended (the “Act”), or Section 20 of the Exchange Act, from and
against any and all losses, claims, expenses, damages or liabilities to which
the Depositor, the Master Servicer, their respective officers or directors
and
any such controlling person may become subject under the Act or otherwise,
as
and when such losses, claims, expenses, damages or liabilities are incurred,
insofar as such losses, claims, expenses, damages or liabilities (or actions
in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the Servicer
Information or
arise
out of, or are based upon, the omission or alleged omission to state therein
any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and will reimburse the Depositor, the Master Servicer, their
respective officers and directors and any such controlling person for any legal
or other expenses reasonably incurred by it or any of them in connection with
investigating or defending any such loss, claim, expense, damage, liability
or
action, as and when incurred; provided,
however,
that
the Servicer
shall
be
liable only insofar as such untrue statement or alleged untrue statement or
omission or alleged omission relates solely to the information in the
Servicer
Information
furnished to the Depositor or Master Servicer by or on behalf of the
Servicer
specifically
in connection with this Agreement.
36
ARTICLE
VII
THE
SERVICER
Section
7.01 Merger
or Consolidation of the Servicer.
The
Servicer 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 entity in each jurisdiction in which such qualification is or shall
be
necessary to protect the validity and enforceability of this Agreement or any
of
the Mortgage Loans and to perform its duties under this Agreement.
Any
Person into which the Servicer may be merged or consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Servicer
shall be a party, or any Person succeeding to the business of the Servicer,
shall be the successor of the Servicer hereunder, without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding, provided, however, that the
successor or surviving Person shall be an institution (i) having a net worth
of
not less than $25,000,000, and (ii) which is a ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac
approved servicer in good standing.
Section
7.02 Limitation
on Liability of the Servicer and Others.
Neither
the Servicer nor any of the directors, officers, employees or agents of the
Servicer shall be under any liability to the Seller, the Master Servicer or
the
Trustee 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 Servicer or any such person
against any breach of warranties or representations made herein, or failure
to
perform its obligations in strict compliance with any standard of care set
forth
in this Agreement, or any liability which would otherwise be imposed by reason
of any breach of the terms and conditions of this Agreement. The Servicer and
any director, officer, employee or agent of the Servicer may rely in good faith
on any document of any kind prima facie properly executed and submitted by
any
Person respecting any matters arising hereunder. The Servicer 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 Servicer may, with the consent of the Master
Servicer, undertake any such action which it may deem necessary or desirable
in
respect of this Agreement and the rights and duties of the parties hereto.
In
such event, the Servicer shall be entitled to reimbursement from the Trust
Fund
for the reasonable legal expenses and costs of such action.
37
Section
7.03 Limitation
on Resignation and Assignment by the Servicer.
The
Seller has entered into this Agreement with the Servicer in reliance upon the
independent status of the Servicer, and the representations as to the adequacy
of its servicing facilities, plant, personnel, records and procedures, its
integrity, reputation and financial standing, and the continuance thereof.
Therefore, the Servicer shall neither assign its rights under this Agreement
or
the servicing hereunder nor delegate its duties hereunder or any portion
thereof, or sell or otherwise dispose of all or substantially all of its
property or assets without, in each case, the prior written consent of the
Seller (as owner of the servicing rights relating to the Mortgage Loans) and
the
Master Servicer, which consent, in the case of an assignment of rights or
delegation of duties, shall be granted or withheld in the discretion of the
Seller and the Master Servicer, and which consent, in the case of a sale or
disposition of all or substantially all of the property or assets of the
Servicer, shall not be unreasonably withheld; provided, that in each case,
there
must be delivered to the Master Servicer and the Trustee a letter from each
Rating Agency to the effect that such transfer of servicing or sale or
disposition of assets will not result in a qualification, withdrawal or
downgrade of the then-current rating of any of the Certificates.
Notwithstanding the foregoing, the Servicer, without the consent of the Seller
(as
owner
of the servicing rights relating to the Mortgage Loans),
the
Master Servicer or the Trustee, may retain third party contractors to perform
certain servicing and loan administration functions, including without
limitation, hazard insurance administration, tax payment and administration,
flood certification and administration, collection services and similar
functions; provided, that the retention of such contractors by Servicer shall
not limit the obligation of the Servicer to service the Mortgage Loans pursuant
to the terms and conditions of this Agreement.
The
Servicer shall not resign from the obligations and duties hereby imposed on
it
except by mutual consent of the Servicer and the Master Servicer or upon the
determination that its duties hereunder are no longer permissible under
applicable law and such incapacity cannot be cured by the Servicer. Any such
determination permitting the resignation of the Servicer shall be evidenced
by
an Opinion of Counsel to such effect delivered to the Master Servicer and the
Trustee which Opinion of Counsel shall be in form and substance acceptable
to
the Master Servicer and the Trustee. No such resignation shall become effective
until a successor shall have assumed the Servicer’s responsibilities and
obligations hereunder in the manner provided in Section 9.01.
Without
in any way limiting the generality of this Section 7.03, in the event that
the
Servicer either shall assign this Agreement or the servicing responsibilities
hereunder or delegate its duties hereunder or any portion thereof or sell or
otherwise dispose of all or substantially all of its property or assets, without
the prior written consent of the Seller, the Trustee and the Master Servicer,
then the Seller, the Trustee or the Master Servicer shall have the right to
terminate this Agreement upon notice given as set forth in Section 8.01, without
any payment of any penalty or damages and without any liability whatsoever
to
the Servicer or any third party.
38
Section
7.04 [Subservicing
Agreements and Successor Subservicer.
(a) The
Servicer may enter into subservicing agreements for any servicing and
administration of the Mortgage Loans with any institution which (i) is an
approved ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac Seller/Servicer and (ii) which represents
and
warrants that it is in compliance with the laws of each state as necessary
to
enable it to perform its obligations under such subservicing agreement. For
this
purpose, subservicing shall not be deemed to include outsourcing routine tasks
to third parties including, but not limited to, taxes, insurance, property
inspection, reconveyance, collection or brokering REO Property. The Servicer
shall give prior written notice to the Master Servicer, the Depositor and the
Trustee of the appointment of any subservicer or other subcontractor and shall
furnish to the Master Servicer a copy of such subservicing agreement. For
purposes of this Agreement, the Servicer shall be deemed to have received
payments on Mortgage Loans immediately upon receipt by any subservicer of such
payments. Any such subservicing agreement shall be consistent with and not
violate the provisions of this Agreement. Each subservicing agreement shall
provide that a successor servicer shall have
the
option to terminate such agreement without payment of any fees if the
predecessor servicer is terminated or resigns.
(b) The
Servicer may terminate any subservicing agreement to which it is a party in
accordance with the terms and conditions of such subservicing agreement and
either itself directly service the related Mortgage Loans or enter
into a subservicing agreement with a successor subservicer or subcontractor
that
qualifies under Section 7.04(a).
(c) Notwithstanding
any subservicing agreement or the provisions of this Agreement relating to
agreements or arrangements between the Servicer and a subservicer or other
subcontractor or reference to actions taken through a subservicer or otherwise,
(i) the Servicer shall remain obligated and primarily liable to the Trustee,
the
Master Servicer and the Certificateholders for the servicing and administering
of the Mortgage Loans in accordance with the provisions hereof without
diminution of such obligation or liability by virtue of such subservicing
agreements or arrangements or by virtue of indemnification from the subservicer
and to the same extent and under the same terms and conditions as if the
Servicer alone were servicing and administering the Mortgage Loans and (ii)
any
subservicer or other subcontractor that performs any of the functions identified
in Item 1122(d) of Regulation AB must agree in writing that, if the Master
Servicer or the Depositor determines that such subcontractor was “participating
in the servicing function” within the meaning of Item 1122, such subcontractor
will comply with the provisions of Sections 5.02, 5.03 and 5.04 to the same
extent as if such subservicer were the Servicer. The Servicer shall be entitled
to enter into any agreement with a subservicer for indemnification of the
Servicer by such subservicer and nothing contained in this Agreement shall
be
deemed to limit or modify such indemnification. ]
39
ARTICLE
VIII
TERMINATION
Section
8.01 Termination
for Cause.
This
Agreement shall be terminable at the option of the Seller or the Master Servicer
if any of the following events of default exist on the part of the
Servicer:
(i)
any
failure by the Servicer to remit to the Master Servicer any payment required
to
be made under the terms of this Agreement which continues unremedied for a
period of two Business Days after the date upon which written notice of such
failure, requiring the same to be remedied, shall have been given to the
Servicer by the Master Servicer; or
(ii)
failure
by the Servicer duly to observe or perform in any material respect any other
of
the covenants or agreements on the part of the Servicer set forth in this
Agreement which continues unremedied for a period of 30 days; or
(iii)
failure
by the Servicer to maintain its license to do business or service residential
mortgage loans in any jurisdiction, if required by such jurisdiction, where
the
Mortgaged Properties are located; or
(iv)
a
decree
or order of a court or agency or supervisory authority having jurisdiction
for
the appointment of a conservator or receiver or liquidator in any insolvency,
readjustment of debt, including bankruptcy, marshaling of assets and liabilities
or similar proceedings, or for the winding-up or liquidation of its affairs,
shall have been entered against the Servicer and such decree or order shall
have
remained in force undischarged or unstayed for a period of 60 days;
or
(v)
the
Servicer 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 Servicer or of or
relating to all or substantially all of its property; or
(vi)
the
Servicer shall admit in writing its inability to pay its debts generally as
they
become due, file a petition to take advantage of any applicable insolvency,
bankruptcy or reorganization statute, make an assignment for the benefit of
its
creditors, voluntarily suspend payment of its obligations or cease its normal
business operations for three Business Days; or
(vii)
the
Servicer ceases to meet the qualifications of a ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac
seller/servicer; or
(viii)
the
Servicer attempts to assign the servicing of the Mortgage Loans or its right
to
servicing compensation hereunder or the Servicer attempts to sell or otherwise
dispose of all or substantially all of its property or assets or to assign
this
Agreement or the servicing responsibilities hereunder or to delegate its duties
hereunder or any portion thereof (to other than a third party in the case of
outsourcing routine tasks including, but not limited to, taxes, insurance,
property inspection, reconveyance, collection or brokering REO Property), in
each case without complying fully with the provisions of Section
7.03.
40
In
each
and every such case, so long as an event of default shall not have been
remedied, in addition to whatever rights the Seller or the Master Servicer
may
have at law or equity to damages, including injunctive relief and specific
performance, the Seller or the Master Servicer, by notice in writing to the
Servicer, may terminate all the rights and obligations of the Servicer under
this Agreement and in and to the servicing contract established hereby and
the
proceeds thereof.
Upon
receipt by the Servicer of such written notice, all authority and power of
the
Servicer under this Agreement, whether with respect to the Mortgage Loans or
otherwise, shall pass to and be vested in a successor Servicer appointed by
the
Seller and the Master Servicer. Upon written request from the Seller, the
Servicer shall prepare, execute and deliver to the successor entity designated
by the Seller 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 and endorsement or
assignment of the Mortgage Loans and related documents, at the Servicer’s sole
expense. The Servicer shall cooperate with the Seller and the Master Servicer
and such successor in effecting the termination of the Servicer’s
responsibilities and rights hereunder, including without limitation, the
transfer to such successor for administration by it of all cash amounts which
shall at the time be credited by the Servicer to the Custodial Account or Escrow
Account or thereafter received with respect to the Mortgage Loans.
By
a
written notice, the Seller and the Master Servicer may waive any default by
the
Servicer in the performance of its obligations hereunder and its consequences.
Upon any waiver of a past default, such default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been remedied for
every purpose of this Agreement. No such waiver shall extend to any subsequent
or other default or impair any right consequent thereon except to the extent
expressly so waived.
Section
8.02 Termination
Without Cause.
This
Agreement shall terminate upon: (i) the later of (a) the distribution of the
final payment or liquidation proceeds on the last Mortgage Loan to the Master
Servicer (or advances by the Servicer for the same), and (b) the disposition
of
all REO Property acquired upon foreclosure of the last Mortgage Loan and the
remittance of all funds due hereunder, (ii) mutual consent of the Servicer,
the
Seller (as owner of the servicing rights relating to the Mortgage Loans), the
Trustee and the Master Servicer in writing or (iii) at the sole discretion
of
the Seller (acting in its capacity as owner of the servicing rights relating
to
the Mortgage Loans). Any such termination pursuant to clause (iii) above shall
be with 30 days’ prior notice, in writing and delivered to the Trustee, the
Master Servicer and the Servicer by registered mail to the addresses set forth
in Section 9.03 of this Agreement (in the case of the Servicer) or in the
Pooling and Servicing Agreement (in the case of the Trustee or the Master
Servicer). The Servicer shall comply with the termination procedures set forth
in Sections 7.03, 8.01 and 9.01 hereof. The Master Servicer or the Trustee
shall
have no right to terminate the Servicer pursuant to this Section 8.02. In
connection with a termination by the Seller pursuant to clause (iii) of this
Section 8.02, the Servicer shall be reimbursed for all unreimbursed
out-of-pocket Servicing Advances, Monthly Advances and Servicing Fees and other
reasonable and necessary out-of-pocket costs associated with any transfer of
servicing at the time of such transfer of servicing. Any invoices received
by
the Servicer after termination will be forwarded to the Seller or the successor
servicer for payment within thirty (30) days of receipt from the Servicer.
41
ARTICLE
IX
MISCELLANEOUS
PROVISIONS
Section
9.01 Successor
to the Servicer.
Simultaneously
with the termination of the Servicer’s responsibilities and duties under this
Agreement (a) pursuant to Sections 6.02, 7.03, 8.01 or 8.02(ii), the Master
Servicer shall (i) succeed to and assume all of the Servicer’s responsibilities,
rights, duties and obligations under this Agreement, or (ii) appoint a successor
having the characteristics set forth in clauses (i) and (ii) of Section 7.01
and
which shall succeed to all rights and assume all of the responsibilities, duties
and liabilities of the Servicer under this Agreement simultaneously with the
termination of the Servicer’s responsibilities, duties and liabilities under
this Agreement; or (b) pursuant to a termination under Section 8.02(iii), the
Seller (as owner of the servicing rights relating to the Mortgage Loans) shall
appoint a successor having the characteristics set forth in clauses (i) and
(ii)
of Section 7.01 and which shall succeed to all rights and assume all of the
responsibilities, duties and liabilities of the Servicer under this Agreement
simultaneously with the termination of the Servicer’s responsibilities, duties
and liabilities under this Agreement. Any successor to the Servicer shall be
subject to the approval of the Master Servicer and, to the extent required
by
the Pooling and Servicing Agreement, the Trustee and such successor, shall
be a
member in good standing of the MERS system (if any of the Mortgage Loans are
MERS Eligible Mortgage Loans, unless such Mortgage Loans are withdrawn from
MERS
and Assignments of Mortgage are recorded in favor of the Trustee at the expense
of the successor Servicer). Any approval of a successor servicer by the Master
Servicer and, to the extent required by the Pooling and Servicing Agreement,
the
Trustee, shall, if the successor servicer is not at that time a servicer of
other Mortgage Loans for the Trust Fund, be conditioned upon the receipt by
the
Master Servicer and the Trustee of a letter from each Rating Agency to the
effect that such transfer of servicing will not result in a qualification,
withdrawal or downgrade of the then-current rating of any of the Certificates.
In connection with such appointment and assumption, the Master Servicer or
the
Seller, as applicable, may make such arrangements for the compensation of such
successor out of payments on Mortgage Loans as it and such successor shall
agree, provided, however, that no such compensation shall be in excess of that
permitted the Servicer under this Agreement. In the event that the Servicer’s
duties, responsibilities and liabilities under this Agreement should be
terminated pursuant to the aforementioned sections, the Servicer shall discharge
such duties and responsibilities during the period from the date it acquires
knowledge of such termination until the effective date thereof with the same
degree of diligence and prudence which it is obligated to exercise under this
Agreement, and shall take no action whatsoever that might impair or prejudice
the rights or financial condition of its successor. The resignation or removal
of the Servicer pursuant to the aforementioned sections shall not become
effective until a successor shall be appointed pursuant to this Section 9.01
and
shall in no event relieve the Servicer of the representations and warranties
made pursuant to Sections 6.01 and the remedies available to the Master Servicer
and the Seller under Section 6.02 and 6.03, it being understood and agreed
that
the provisions of such Sections 6.01, 6.02 and 6.03 shall be applicable to
the
Servicer notwithstanding any such resignation or termination of the Servicer,
or
the termination of this Agreement. Neither the Master Servicer, in its capacity
as successor servicer, nor any other successor servicer, shall be responsible
for the lack of information and/or documents that are not transferred to it
by
the Servicer and that it cannot otherwise obtain through reasonable
efforts.
42
Within
a
reasonable period of time, but in no event longer than 30 days of the
appointment of a successor entity, the Servicer 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 and
endorsement of the Mortgage Notes and related documents, and the preparation
and
recordation of Assignments of Mortgage. The Servicer shall cooperate with the
Trustee, the Master Servicer or the Seller, as applicable, and such successor
in
effecting the termination of the Servicer’s responsibilities and rights
hereunder and the transfer of servicing responsibilities to the successor
Servicer, including without limitation, the transfer to such successor for
administration by it of all cash amounts which shall at the time be credited
by
the Servicer 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 Trustee, the Servicer, the Master Servicer and the Seller an instrument
(i)
accepting such appointment, wherein the successor shall make the representations
and warranties set forth in Section 6.01 (including a representation that the
successor Servicer is a member of MERS, unless none of the Mortgage Loans are
MERS Mortgage Loans or MERS Eligible Mortgage Loans or any such Mortgage Loans
have been withdrawn from MERS and Assignments of Mortgage are recorded in favor
of the Trustee) and (ii) an assumption of the due and punctual performance
and
observance of each covenant and condition to be performed and observed by the
Servicer under this Agreement, whereupon such successor shall become fully
vested with all the rights, powers, duties, responsibilities, obligations and
liabilities of the Servicer, with like effect as if originally named as a party
to this Agreement. Any termination or resignation of the Servicer or termination
of this Agreement pursuant to Sections 6.02, 7.03, 8.01 or 8.02 shall not affect
any claims that the Master Servicer or the Trustee may have against the Servicer
arising out of the Servicer’s actions or failure to act prior to any such
termination or resignation. In addition, in the event any successor servicer
is
appointed pursuant to Section 8.02(iii) of this Agreement, such successor
servicer must satisfy the conditions relating to the transfer of servicing
set
forth in the Pooling and Servicing Agreement.
The
Servicer shall deliver promptly to the successor servicer the funds in the
Custodial Account and Escrow Account (and any funds thereafter received by
it
with respect to the Mortgage Loans) and all Mortgage Loan documents and related
documents and statements held by it hereunder and the Servicer shall account
for
all funds and shall execute and deliver such instruments and do such other
things as may reasonably be required to more fully and definitively vest in
the
successor all such rights, powers, duties, responsibilities, obligations and
liabilities of the Servicer.
43
Upon
a
successor’s acceptance of appointment as such, the Servicer shall notify the
Trustee, the Seller and Master Servicer of such appointment in accordance with
the procedures set forth in Section 9.03.
Section
9.02 Costs.
The
Seller shall pay the legal fees and expenses of its attorneys. Costs and
expenses incurred in connection with the transfer of the servicing
responsibilities, including fees for delivering Servicing Files, shall be paid
by the Seller. Subject to Sections 2.02 and 3.01(a), the Depositor shall pay
the
costs associated with the preparation, delivery and recording of Assignments
of
Mortgages.
Section
9.03 Notices.
All
demands, notices and communications hereunder shall be in writing and shall
be
deemed to have been duly given if sent by facsimile or mailed by overnight
courier, addressed as follows (or such other address as may hereafter be
furnished to the other party by like notice):
44
(i) if
to the
Seller:
[_______________]
[_______________]
[_______________]
Attention:
[___________]
Telephone
No.: [_______________]
Telecopier
No.: [_______________]
(ii) if
to the
Servicer:
[_______________]
[_______________]
[_______________]
Attention:
[___________]
Telephone
No.: [_______________]
Telecopier
No.: [_______________]
(iii) if
to the
Master Servicer:
[_______________]
[_______________]
[_______________]
Attention:
[___________]
Telephone
No.: [_______________]
Telecopier
No.: [_______________]
(iv) if
to the
Trustee:
[_______________]
[_______________]
[_______________]
Attention:
[___________]
Telephone
No.: [_______________]
Telecopier
No.: [_______________]
Any
such
demand, notice or communication hereunder shall be deemed to have been received
on the date delivered to or received at the premises of the addressee.
Section
9.04 Severability
Clause.
Any
part,
provision, representation or warranty of this Agreement which is prohibited
or
which is held to be void or unenforceable shall be ineffective to the extent
of
such prohibition or unenforceability without invalidating the remaining
provisions hereof. Any part, provision, representation or warranty of this
Agreement which is prohibited or unenforceable or is held to be void or
unenforceable in any jurisdiction shall be ineffective, as to such jurisdiction,
to the extent of such prohibition or unenforceability without invalidating
the
remaining provisions hereof, and any such prohibition or unenforceability in
any
jurisdiction as to any Mortgage Loan shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by applicable law, the parties hereto waive any provision of law which prohibits
or renders void or unenforceable any provision hereof. If the invalidity of
any
part, provision, representation or warranty of this Agreement shall deprive
any
party of the economic benefit intended to be conferred by this Agreement, the
parties shall negotiate, in good-faith, to develop a structure the economic
effect of which is as close as possible to the economic effect of this Agreement
without regard to such invalidity.
45
Section
9.05 No
Personal Solicitation.
From
and
after the Closing Date, the Servicer hereby agrees that it will not take any
action or permit or cause any action to be taken by any of its agents or
affiliates, or by any independent contractors on the Servicer’s behalf, to
personally, by telephone or mail, solicit the borrower or obligor under any
Mortgage Loan (on a targeted basis) for any purposes of prepayment, refinancing
or modification of the related Mortgage Loan, provided, however, that this
limitation shall not prohibit Servicer from soliciting such Mortgagor for
purposes of prepayment, refinance or modification of any loan owned or serviced
by Servicer other than a Mortgage Loan. It is understood and agreed that, among
other marketing activities, promotions undertaken by Servicer which are directed
of the general public at large or which are directed generally to a segment
of
the then existing customers of Servicer or any of its direct or indirect
subsidiaries (including, without limitation, the mailing of promotional
materials to Servicer’s deposit customers by inserting such materials into
customer account statements, mass mailings based on commercially acquired
mailing lists and newspaper, radio and television advertisements) shall not
constitute solicitation under this section. In the event the Servicer does
refinance any Mortgage Loan as a result of a violation of the requirements
set
forth in this Section 9.05, Servicer hereby agrees to pay to the Trust Fund
an
amount equal to the difference, if any, between the amount that the Trust Fund
would have received if it had sold the Mortgage Loan to a third party, and
the
proceeds received by the Trust Fund as a result of such
refinancing.
Section
9.06 Counterparts.
This
Agreement may be executed simultaneously in any number of counterparts. Each
counterpart shall be deemed to be an original, and all such counterparts shall
constitute one and the same instrument.
Section
9.07 Place
of Delivery and Governing Law.
This
Agreement shall be deemed in effect when a fully executed counterpart thereof
is
received by the Seller in the State of New York and shall be deemed to have
been
made in the State of New York. THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE
STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER
THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.
46
Section
9.08 Further
Agreements.
The
Seller and the Servicer each agree to execute and deliver to the other such
reasonable and appropriate additional documents, instruments or agreements
as
may be necessary or appropriate to effectuate the purposes of this
Agreement.
Section
9.09 Intention
of the Parties.
It
is the
intention of the parties that the Seller is conveying, and the Servicer is
receiving only a contract for servicing the Mortgage Loans. Accordingly, the
parties hereby acknowledge that the Trust Fund remains the sole and absolute
owner of the Mortgage Loans and all rights (other than the servicing rights)
related thereto.
Section
9.10 Successors
and Assigns; Assignment of Servicing Agreement.
This
Agreement shall bind and inure to the benefit of and be enforceable by the
Servicer, the Seller, the Trustee and the Master Servicer and their respective
successors and assigns. This Agreement shall not be assigned, pledged or
hypothecated by the Servicer to a third party except in accordance with Section
7.03.
Section
9.11 Assignment
by the Seller.
The
Seller shall have the right, upon notice to but without the consent of the
Servicer, to assign, in whole or in part, its interest under this Agreement
to
the Depositor, which in turn shall assign such rights to the Trustee, and the
Trustee then shall succeed to all rights (but not the obligations, except as
set
forth in the Pooling and Servicing Agreement) of the Seller under this Agreement
(and in performing hereunder, the Trustee shall have all of the rights,
protections and immunities afforded to it under the Pooling and Servicing
Agreement). All references to the Seller in this Agreement shall be deemed
to
include its assignee or designee and any subsequent assignee or designee,
specifically including the Trustee, except with respect to the Seller’s retained
servicing rights pursuant to Section 8.02(iii).
The
Seller shall have the right, upon notice to but without the consent of the
Servicer or the Trustee, to assign, in whole or in part, its retained servicing
rights. All references to the Seller in this Agreement, in its capacity as
an
owner of servicing rights, shall be deemed to include the assignee or designee
and any subsequent assignee or designee, of the Seller’s rights arising pursuant
to Section 8.02(iii).
Section
9.12 Waivers.
No
term
or provision of this Agreement may be waived or modified unless such waiver
or
modification is in writing and signed by the party against whom such waiver
or
modification is sought to be enforced.
Section
9.13 Exhibits.
The
exhibits to this Agreement are hereby incorporated and made a part hereof and
are an integral part of this Agreement.
47
Section
9.14 General
Interpretive Principles.
For
purposes of this Agreement, except as otherwise expressly provided or unless
the
context otherwise requires:
(a)
the
terms
defined in this Agreement have the meanings assigned to them in this Agreement
and include the plural as well as the singular, and the use of any gender herein
shall be deemed to include the other gender;
(b)
accounting
terms not otherwise defined herein have the meanings assigned to them in
accordance with generally accepted accounting principles;
(c)
references
herein to “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 by reason of enumeration.
Section
9.15 Reproduction
of Documents.
This
Agreement and all documents relating thereto, including, without limitation,
(i)
consents, waivers and modifications which may hereafter be executed, (ii)
documents received by any party at the closing, and (iii) financial statements,
certificates and other information previously or hereafter furnished, may be
reproduced by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties agree that any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding, whether or not the original is in
existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in
evidence.
Section
9.16 Protection
of Confidential Information.
The
Servicer shall keep confidential and shall not divulge to any party, without
the
Seller’s prior written consent, any nonpublic information pertaining to the
Mortgage Loans or any borrower thereunder, except to the extent that it is
appropriate for the Servicer to do so in working with legal counsel, auditors,
taxing authorities or other governmental agencies or it is otherwise in
accordance with Accepted Servicing Practices.
48
Section
9.17 Amendment.
This
Agreement may be amended from time to time by the written agreement signed
by
the Master Servicer, the Seller and the Servicer; provided
that the
party requesting such amendment shall, at its own expense, provide the Trustee,
the Master Servicer and the Seller with an Opinion of Counsel that such
amendment will not materially adversely affect the interest of the
Certificateholders in the Mortgage Loans. Any such amendment shall be deemed
not
to adversely affect in any material respect any the interest of the
Certificateholders in the Mortgage Loans, if the Trustee receives written
confirmation from each Rating Agency that such amendment will not cause such
Rating Agency to reduce, qualify or withdraw the then current rating assigned
to
the Certificates (and any Opinion of Counsel requested by the Trustee, the
Master Servicer and the Seller in connection with any such amendment may rely
expressly on such confirmation as the basis therefore).
49
IN
WITNESS WHEREOF, the Servicer, the Seller and the Master Servicer have caused
their names to be signed hereto by their respective officers thereunto duly
authorized as of the date first above written.
| [_________________], | ||
|
as
Seller
|
||
| By: | ||
|
Name:
Title:
|
||
| [_________________], | ||
|
as
Servicer
|
||
| By: | ||
|
Name:
Title:
|
||
| [_________________], | ||
|
as
Master Servicer
|
||
| By: | ||
|
Name:
Title:
|
||
Acknowledged
By:
[_________________],
as
Trustee and not individually
| By: | ||||
|
Name:
Title:
|
EXHIBIT
A
MORTGAGE
LOAN SCHEDULE
(including
Prepayment Penalty Schedule)
A-1
EXHIBIT
B
CUSTODIAL
ACCOUNT CERTIFICATION
[_______]
[__],
20[__]
[_______________]
hereby
certifies that it has established the account described below as a Custodial
Account pursuant to Section 3.03 of the Servicing Agreement dated [_______]
[__],
20[__], by and between [_______________],
as
seller, [_______________],
in as
servicer and [_______________],
as master
servicer, and acknowledged by [_______________],
as
trustee.
Title
of
Account: [_______________],
in
trust for the Master Servicer for ▇▇▇▇▇▇▇▇▇ Mortgage Securities Corporation,
[Name of Series],
and
various Mortgagors.
Account
Number: _______________
Address
of office or branch of the firm at which Account is maintained:
_______________________________________________________
_______________________________________________________
_______________________________________________________
| [_________________] | ||
|
|
||
| By: |
____________________________________________________________________
|
|
|
|
||
|
|
Name:
_______________________________________________________________
Title:
________________________________________________________________
|
|
B-1
EXHIBIT
C
ESCROW
ACCOUNT CERTIFICATION
[_______________]
hereby
certifies that it has established the account described below as a Custodial
Account pursuant to Section 3.05 of the Servicing Agreement dated [_______]
[__],
20[__], by and between [_______________],
as
seller, [_______________],
in as
servicer and [_______________],
as master
servicer, and acknowledged by [_______________],
as
trustee.
Title
of
Account: [_______________],
in
trust for the Master Servicer for ▇▇▇▇▇▇▇▇▇ Mortgage Securities Corporation
[Name of Series],
and
various Mortgagors.
Account
Number: _______________
Address
of office or branch of the firm at which Account is maintained:
______________________________________________________
______________________________________________________
______________________________________________________
| [_________________] | ||
|
|
||
| By: |
____________________________________________________________________
|
|
|
|
||
|
|
Name:
_______________________________________________________________
Title:
________________________________________________________________
|
|
▇-▇
▇▇▇▇▇▇▇
▇-▇
FORM
OF MONTHLY REMITTANCE ADVICE
D-1-1
EXHIBIT
D-2
STANDARD
LAYOUT FOR MONTHLY DEFAULTED LOAN REPORT
D-2-1
EXHIBIT
E
[Date]
▇▇▇▇▇▇▇▇▇
Mortgage Securities Corporation
▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇
▇▇,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
[___________]
[______________]
[______________]
[______________]
Attention:
[______________]
[______________]
[______________]
[______________]
Attention:
[______________]
Reference
is made to the Servicing Agreement dated as of [________] [__], 20[__] (the
“Agreement”), by and among [_______________],
as
seller (the “Seller”), [______________], as servicer (in such capacity, the
“Servicer”), and [______________], as master servicer (in such capacity, the
“Master Servicer”), and acknowledged by [______________], as trustee (the
“Trustee”). I, [identify the certifying individual], a [title] of the Servicer,
hereby certify to the Master Servicer, the Trustee and ▇▇▇▇▇▇▇▇▇ Mortgage
Securities Corporation (the “Depositor”), and their respective officers,
directors and affiliates, and with the knowledge and intent that they will
rely
upon this certification, that:
1. I
have
reviewed the information required to be delivered to the Master Servicer
pursuant to Section 5.03 of the Agreement (the “Servicing
Information”).
2. Based
on
my knowledge, the Servicing Information does not contain any untrue statement
of
a material fact information or omit to state a material fact necessary to make
the Servicing Information, in light of the circumstances under which such
statements were made, not misleading as of the date of this
certification;
3. Based
on
my knowledge, the Servicing Information has been provided to the Master Servicer
when and as required under the Agreement; and
Ex
2 -1
4. I
am
responsible for reviewing the activities performed by the Servicer under the
Agreement, and based upon my knowledge and the review required under the
Agreement, and except as disclosed in writing to you on or prior to the date
of
this certification either in the accountants’ report required under the
Agreement or in disclosure a copy of which is attached hereto, the Servicer
has,
as of the date of this certification, fulfilled its obligations under this
Agreement.
| [_________________] | ||
|
|
||
| By: | ||
|
Name:
Title:
|
||
Ex
2 -2