Exhibit 99.8(b)
EXECUTION COPY
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MORTGAGE LOAN SALE AND SERVICING AGREEMENT
between
AMERICAN HOME MORTGAGE CORP.,
as Seller,
AMERICAN HOME MORTGAGE SERVICING, INC.,
as Servicer,
and
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ MORTGAGE CAPITAL INC.,
as Purchaser
Dated as of January 1, 2006
Conventional,
Fixed and Adjustable Rate,
Residential Mortgage Loans
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TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS...................................................1
SECTION 2. PURCHASE AND CONVEYANCE......................................16
SECTION 3. MORTGAGE LOAN SCHEDULE.......................................17
SECTION 4. PURCHASE PRICE...............................................17
SECTION 5. EXAMINATION OF MORTGAGE FILES................................17
SECTION 6. DELIVERY OF MORTGAGE LOAN DOCUMENTS..........................18
Subsection 6.01 Possession of Mortgage Files............................18
Subsection 6.02 Books and Records.......................................18
Subsection 6.03 Delivery of Mortgage Loan Documents.....................18
Subsection 6.04 MERS Designated Loans...................................20
SECTION 7. REPRESENTATIONS, WARRANTIES AND COVENANTS; REMEDIES
FOR BREACH...................................................20
Subsection 7.01 Representations and Warranties Regarding Individual
Mortgage Loans..........................................20
Subsection 7.02 Seller and Servicer Representations.....................35
Subsection 7.03 Remedies for Breach of Representations and Warranties...39
Subsection 7.04 Repurchase of Mortgage Loans with Early Payment Defaults41
Subsection 7.05 Premium Recapture.......................................42
SECTION 8. CLOSING......................................................42
SECTION 9. CLOSING DOCUMENTS............................................42
SECTION 10. COSTS........................................................44
SECTION 11. ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS...........44
Subsection 11.01 Servicer to Act as Servicer.............................44
Subsection 11.02 Liquidation of Mortgage Loans...........................45
Subsection 11.03 Collection of Mortgage Loan Payments....................46
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Subsection 11.04 Establishment of Custodial Account; Deposits in
Custodial Account.......................................46
Subsection 11.05 Withdrawals From the Custodial Account..................47
Subsection 11.06 Establishment of Escrow Account; Deposits in Escrow
Account.................................................48
Subsection 11.07 Withdrawals From Escrow Account.........................49
Subsection 11.08 Payment of Taxes, Insurance and Other Charges; Collections
Thereunder..............................................49
Subsection 11.09 Transfer of Accounts....................................50
Subsection 11.10 Maintenance of Hazard Insurance.........................50
Subsection 11.11 Fidelity Bond; Errors and Omissions Insurance...........50
Subsection 11.12 Title, Management and Disposition of REO Property.......51
Subsection 11.13 Servicing Compensation..................................52
Subsection 11.14 Distributions...........................................52
Subsection 11.15 Statements to the Purchaser.............................53
Subsection 11.16 Advances by the Servicer................................53
Subsection 11.17 Assumption Agreements...................................54
Subsection 11.18 Satisfaction of Mortgages and Release of Mortgage Files.54
Subsection 11.19 [Reserved.].............................................54
Subsection 11.20 [Reserved.].............................................54
Subsection 11.21 Servicer Shall Provide Access and Information as Reasonably
Required................................................55
Subsection 11.22 Transfer of Servicing...................................55
Subsection 11.23 Notification of Maturity Date...........................57
Subsection 11.24 Notification of Adjustments.............................57
SECTION 12. THE SERVICER.................................................58
Subsection 12.01 Indemnification; Third Party Claims.....................58
Subsection 12.02 Merger or Consolidation of the Servicer.................59
Subsection 12.03 Limitation on Liability of the Servicer and Others......60
Subsection 12.04 Seller and Servicer Not to Resign.......................60
SECTION 13. DEFAULT......................................................60
Subsection 13.01 Events of Default.......................................60
Subsection 13.02 Waiver of Defaults......................................62
SECTION 14. TERMINATION..................................................62
Subsection 14.01 Termination.............................................62
Subsection 14.02 Termination of the Servicer Without Cause...............62
Subsection 14.03 Successors to the Servicer..............................62
SECTION 15. COOPERATION OF SELLER WITH A RECONSTITUTION..................63
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SECTION 16. NOTICES......................................................65
SECTION 17. SEVERABILITY CLAUSE..........................................66
SECTION 18. NO PARTNERSHIP...............................................66
SECTION 19. COUNTERPARTS.................................................66
SECTION 20. GOVERNING LAW JURISDICTION...................................67
SECTION 21. MANDATORY DELIVERY; GRANT OF SECURITY INTEREST...............67
SECTION 22. INTENTION OF THE PARTIES.....................................68
SECTION 23. SUCCESSORS AND ASSIGNS.......................................68
SECTION 24. WAIVERS......................................................68
SECTION 25. EXHIBITS.....................................................68
SECTION 26. GENERAL INTERPRETIVE PRINCIPLES..............................68
SECTION 27. REPRODUCTION OF DOCUMENTS....................................69
SECTION 28. AMENDMENT....................................................69
SECTION 29. CONFIDENTIALITY..............................................69
SECTION 30. ENTIRE AGREEMENT.............................................70
SECTION 31. FURTHER AGREEMENTS...........................................70
SECTION 32. NO SOLICITATION..............................................70
SECTION 33. WAIVER OF JURY TRIAL.........................................70
SECTION 34. COMPLIANCE WITH REGULATION AB................................71
Subsection 34.01 Intent of the Parties; Reasonableness...................71
Subsection 34.02 Additional Representations and Warranties of the Seller.71
Subsection 34.03 Information to Be Provided by the Seller or the
Servicer................................................72
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Subsection 34.04 Servicer Compliance Statement...........................77
Subsection 34.05 Report on Assessment of Compliance and Attestation......77
Subsection 34.06 Use of Subservicers and Subcontractors..................78
Subsection 34.07 Indemnification; Remedies...............................79
EXHIBITS
EXHIBIT 1 MORTGAGE LOAN DOCUMENTS
EXHIBIT 2 CONTENTS OF EACH MORTGAGE FILE
EXHIBIT 3 FORM OF INDEMNIFICATION AND CONTRIBUTION AGREEMENT
EXHIBIT 4 FORM OF CUSTODIAL ACCOUNT CERTIFICATION
EXHIBIT 5 FORM OF CUSTODIAL ACCOUNT LETTER AGREEMENT
EXHIBIT 6 FORM OF ESCROW ACCOUNT CERTIFICATION
EXHIBIT 7 FORM OF ESCROW ACCOUNT LETTER AGREEMENT
EXHIBIT 8 [RESERVED]
EXHIBIT 9 FORM OF MONTHLY REMITTANCE REPORT
EXHIBIT 10 FORM OF SELLER'S OFFICER'S CERTIFICATE
EXHIBIT 11 FORM OF OPINION OF COUNSEL TO THE SELLER
EXHIBIT 12 FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT 13 FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT 14 FORM OF ASSIGNMENT AND CONVEYANCE AGREEMENT
EXHIBIT 15 FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
EXHIBIT 16 FORM OF ANNUAL CERTIFICATION
EXHIBIT 17 SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
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MORTGAGE LOAN SALE AND SERVICING AGREEMENT
THIS MORTGAGE LOAN SALE AND SERVICING AGREEMENT (the "Agreement"),
dated as of January 1, 2006, is hereby executed by and between ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
MORTGAGE CAPITAL INC., a New York corporation (the "Purchaser"), and AMERICAN
HOME MORTGAGE CORP., a New York corporation, as seller (the "Seller") and
AMERICAN HOME MORTGAGE SERVICING, INC., a Maryland corporation, as servicer
(the "Servicer").
W I T N E S S E T H:
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WHEREAS, the Seller desires to sell, from time to time, to the
Purchaser, and the Purchaser desires to purchase, from time to time, from the
Seller, certain conventional fixed and adjustable rate residential first-lien
mortgage loans (the "Mortgage Loans") serviced by the Servicer on a
servicing-retained basis as described herein, and which shall be delivered in
pools of whole loans (each, a "Mortgage Loan Package") on various dates as
provided herein (each, a "Closing Date");
WHEREAS, each Mortgage Loan is secured by a mortgage, deed of
trust or other security instrument creating a first lien on a residential
dwelling located in the jurisdiction indicated on the Mortgage Loan Schedule
for the related Mortgage Loan Package;
WHEREAS, the Purchaser, the Seller and the Servicer wish to
prescribe the manner of the conveyance, servicing by the Servicer and control
of the Mortgage Loans; and
WHEREAS, following its purchase of the Mortgage Loans from the
Seller, the Purchaser desires to sell some or all of the Mortgage Loans to one
or more purchasers as a whole loan transfer or a public or private, rated or
unrated mortgage pass-through transaction.
NOW, THEREFORE, in consideration of the premises and mutual
agreements set forth herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Purchaser,
the Seller and the Servicer agree as follows:
Section 1. Definitions. For purposes of this Agreement, the
following capitalized terms shall have the respective meanings set forth
below.
Accepted Servicing Procedures: Procedures (including collection
procedures) that the Servicer customarily employs and exercises in servicing
and administering mortgage loans for its own account that are similar to the
Mortgage Loans and which are in accordance with accepted mortgage servicing
practices of prudent mortgage lending institutions which service mortgage
loans of the same type as the Mortgage Loans in the jurisdictions where the
related Mortgaged Properties are located.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan
purchased pursuant to this Agreement, the Mortgage Interest Rate of which is
adjusted from time to time in accordance with the terms of the related
Mortgage Note.
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified
Person. For the purposes of this definition, "control" when used with respect
to any specified Person means the power to direct the management and policies
of such Person, directly or indirectly, whether through the ownership of
voting securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing. The Servicer shall be
deemed an Affiliate of the Seller.
Agency Transfer: A ▇▇▇▇▇▇ Mae Transfer or a ▇▇▇▇▇▇▇ Mac Transfer.
Agreement: This Mortgage Loan Sale and Servicing Agreement
including all exhibits, schedules, amendments and supplements hereto.
ALTA: The American Land Title Association.
Appraised Value: With respect to any Mortgaged Property, the
lesser of (i) the value thereof as determined by an appraisal made for the
originator of the Mortgage Loan at the time of origination of the Mortgage
Loan by a Qualified Appraiser and (ii) the purchase price paid for the related
Mortgaged Property by the Mortgagor with the proceeds of the Mortgage Loan;
provided, however, that in the case of a Refinanced Mortgage Loan, such value
of the Mortgaged Property is based solely upon the value determined by an
appraisal made for the originator of such Refinanced Mortgage Loan at the time
of origination of such Refinanced Mortgage Loan by a Qualified Appraiser.
Assignment and Conveyance Agreement: As defined in Section 2.
Assignment of Mortgage: An assignment of the Mortgage, notice of
transfer or equivalent instrument in recordable form, sufficient under the
laws of the jurisdiction wherein the related Mortgaged Property is located to
reflect the sale of the Mortgage to the Purchaser.
Balloon Mortgage Loan: Any Mortgage Loan (a) that requires only
payments of interest until the stated maturity date of the Mortgage Loan or
(b) for which Monthly Payments of principal (not including the payment due on
its stated maturity date) are based on an amortization schedule that would be
insufficient to fully amortize the principal thereof by the stated maturity
date of the Mortgage Loan.
Business Day: Any day other than a Saturday or Sunday, or a day on
which banking and savings and loan institutions in the state in which (i) the
Servicer is located or (ii) the Custodial Account is maintained, are
authorized or obligated by law or executive order to be closed.
Closing Date: The date or dates on which the Purchaser from time
to time shall purchase, and the Seller from time to time shall sell, the
Mortgage Loans listed on the related Mortgage Loan Schedule with respect to
the related Mortgage Loan Package.
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Closing Documents: The documents required to be delivered on each
Closing Date pursuant to Section 9.
CLTA: The California Land Title Association.
CLTV: As of any date and as to any Second Lien Loan, the ratio,
expressed as a percentage, of (a) the sum of (i) the outstanding principal
balance of the Second Lien Loan and (ii) the outstanding principal balance as
of such date of any mortgage loan or mortgage loans that are senior or equal
in priority to the Second Lien Loan and which are secured by the same
Mortgaged Property to (b) the Appraised Value as determined pursuant to the
Underwriting Guidelines of the related Mortgaged Property as of the
origination of the Second Lien Loan.
Code: The Internal Revenue Code of 1986, as amended, or any
successor statute thereto.
Commission: The United States Securities and Exchange Commission.
Condemnation Proceeds: All awards, compensation and settlements in
respect of a taking of all or part of a Mortgaged Property, whether permanent
or temporary, partial or entire, by exercise of the power of condemnation or
the right of eminent domain, to the extent not required to be released to a
Mortgagor in accordance with the terms of the related Mortgage Loan Documents.
Co-op: A private, cooperative housing corporation, having only one
class of stock outstanding, which owns or leases land and all or part of a
building or buildings, including apartments, spaces used for commercial
purposes and common areas therein and whose board of directors authorizes the
sale of stock and the issuance of a Co-op Lease.
Co-op Lease: With respect to a Co-op Loan, the lease with respect
to a dwelling unit occupied by the Mortgagor and relating to the stock
allocated to the related dwelling unit.
Co-op Loan: A Mortgage Loan secured by the pledge of stock
allocated to a dwelling unit in a residential cooperative housing corporation
and a collateral assignment of the related Co-op Lease.
Covered Loan: A Mortgage Loan categorized as Covered pursuant to
Appendix E of Standard & Poor's Glossary.
Custodial Account: As defined in Subsection 11.04.
Custodial Agreement: The agreement governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other
Mortgage Loan Documents. If more than one Custodial Agreement is in effect at
any given time, all of the individual Custodial Agreements shall collectively
be referred to as the "Custodial Agreement."
Custodian: ▇.▇. ▇▇▇▇▇▇ Trust Company, National Association, a
national banking association, and its successors in interest, or any successor
to the Custodian under the Custodial Agreement as therein provided.
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Cut-off Date: The date or dates designated as such on the related
Mortgage Loan Schedule with respect to the related Mortgage Loan Package.
Cut-off Date Principal Balance: The aggregate Stated Principal
Balance of the Mortgage Loans as of the applicable Cut-off Date which is
determined after the application, to the reduction of principal, of payments
of principal due on or before such Cut-off Date, whether or not collected, and
of partial principal prepayments received before such Cut-off Date.
Deemed Material and Adverse Representation: Each representation
and warranty identified as such in Section 7.01 of this Agreement.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased or to
be repurchased or replaced or to be replaced with a Qualified Substitute
Mortgage Loan by the Seller in accordance with the terms of this Agreement.
Delinquent Mortgage Loans: As defined in Subsection 11.01.
Depositor: The depositor, as such term is defined in Regulation
AB, with respect to any Securitization Transaction.
Determination Date: With respect to each Remittance Date, the 15th
day (or, if such 15th day is not a Business Day, the following Business Day)
of the month in which such Remittance Date occurs.
Due Date: With respect to each Remittance Date, the first day of
the calendar month in which such Remittance Date occurs, which is the day on
which the Monthly Payment is due on a Mortgage Loan, exclusive of any days of
grace.
Due Period: With respect to each Remittance Date and any Mortgage
Loan, the period beginning on the second day of the month preceding such
Remittance Date through and including the first day of the month in which such
Remittance Date occurs.
Eligible Investments: Any one or more of the following obligations
or securities:
(a) obligations of or guaranteed as to principal and interest by
▇▇▇▇▇▇▇ Mac, ▇▇▇▇▇▇ ▇▇▇ or any agency or instrumentality of the United
States when such obligations are backed by the full faith and credit of
the United States; provided, however, that such obligations of ▇▇▇▇▇▇▇
Mac or ▇▇▇▇▇▇ ▇▇▇ shall be limited to senior debt obligations and
mortgage participation certificates except that investments in
mortgage-backed or mortgage participation securities with yields
evidencing extreme sensitivity to the rate of principal payments on the
underlying mortgages shall not constitute Eligible Investments hereunder;
(b) repurchase agreements on obligations specified in clause (a)
maturing not more than one month from the date of acquisition thereof;
(c) federal funds, certificates of deposit, demand deposits, time
deposits and bankers' acceptances (which shall each have an original
maturity of not more than ninety
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(90) days and, in the case of bankers' acceptances, shall in no event
have an original maturity of more than 365 days or a remaining maturity
of more than thirty (30) days) denominated in United States dollars of
any United States depository institution or trust company incorporated
under the laws of the United States or any state thereof or of any
domestic branch of a foreign depository institution or trust company;
(d) commercial paper (having original maturities of not more than
365 days) of any corporation incorporated under the laws of the United
States or any state thereof which is rated not lower than "P-2" by
▇▇▇▇▇'▇ Investors Service, Inc. and rated not lower than "A-2" by
Standard & Poor's; and
(e) a money market fund;
provided, however, that no instrument shall be an Eligible Investment if it
represents, either (1) the right to receive only interest payments with
respect to the underlying debt instrument or (2) the right to receive both
principal and interest payments derived from obligations underlying such
instrument and the principal and interest with respect to such instrument
provide a yield to maturity greater than 120% of the yield to maturity at par
of such underlying obligations.
Escrow Account: As defined in Subsection 11.06.
Escrow Payments: With respect to any Mortgage Loan, the amounts
constituting ground rents, taxes, assessments, water rates, sewer rents,
municipal charges, mortgage insurance premiums, fire and hazard insurance
premiums, condominium charges, and any other payments required to be escrowed
by the Mortgagor with the Mortgagee pursuant to the Mortgage or any other
document.
Event of Default: Any one of the conditions or circumstances
enumerated in Subsection 13.01.
Exchange Act: The Securities Exchange Act of 1934, as amended.
▇▇▇▇▇▇ ▇▇▇: The Federal National Mortgage Association or any
successor thereto.
▇▇▇▇▇▇ Mae Guides: The ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇' Guide and the ▇▇▇▇▇▇
Mae Servicers' Guide, as amended or restated from time to time.
▇▇▇▇▇▇ ▇▇▇ Transfer: As defined in Section 15.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
FHA: The Federal Housing Administration, an agency within the
United States Department of Housing and Urban Development, or any successor
thereto and including the Federal Housing Commissioner and the Secretary of
Housing and Urban Development where appropriate under the FHA Regulations.
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Fidelity Bond: The fidelity bond required to be obtained by the
Servicer pursuant to Subsection 11.11.
FIRREA: The Financial Institutions Reform, Recovery, and
Enforcement Act of 1989, as amended and in effect from time to time.
First Lien Loan: A Mortgage Loan secured by a first lien Mortgage
on the related Mortgaged Property.
Fixed Rate Mortgage Loan: A fixed rate mortgage loan purchased
pursuant to this Agreement.
▇▇▇▇▇▇▇ Mac: The Federal Home Loan Mortgage Corporation, or any
successor thereto.
▇▇▇▇▇▇▇ Mac Transfer: As defined in Section 15.
Gross Margin: With respect to each Adjustable Rate Mortgage Loan,
the fixed percentage amount set forth in the related Mortgage Note which
amount is added to the Index in accordance with the terms of the related
Mortgage Note to determine on each Interest Rate Adjustment Date the Mortgage
Interest Rate for such Mortgage Loan.
High Cost Loan: A Mortgage Loan (a) covered by the Home Ownership
and Equity Protection Act of 1994, (b) classified as a "high cost home,"
"threshold," "covered," (excluding New Jersey "Covered Home Loans" as that
term was defined in clause (1) of the definition of that term in the New
Jersey Home Ownership Security Act of 2002 that were originated between
November 26, 2003 and July 7, 2004), "high risk home," "predatory" or similar
loan under any other applicable state, federal or local law (or a similarly
classified loan using different terminology under a law imposing heightened
regulatory scrutiny or additional legal liability for residential mortgage
loans having high interest rates, points and/or fees) or (c) a Mortgage Loan
categorized as High Cost pursuant to Appendix E of Standard & Poor's Glossary.
For avoidance of doubt, the parties agree that this definition shall apply to
any law regardless of whether such law is presently, or in the future becomes,
the subject of judicial review or litigation.
Home Loan: A Mortgage Loan categorized as a Home Loan pursuant to
Appendix E of Standard & Poor's Glossary.
HUD: The Department of Housing and Urban Development, or any
federal agency or official thereof which may from time to time succeed to the
functions thereof with regard to Mortgage Insurance issued by the FHA. The
term "HUD," for purposes of this Agreement, is also deemed to include
subdivisions thereof such as the FHA and Government National Mortgage
Association.
Index: The index indicated in the related Mortgage Note for each
Adjustable Rate Mortgage Loan.
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Insurance Proceeds: With respect to each Mortgage Loan, proceeds
of insurance policies insuring the Mortgage Loan or the related Mortgaged
Property.
Interest Rate Adjustment Date: With respect to each Adjustable
Rate Mortgage Loan, the date, specified in the related Mortgage Note and the
related Mortgage Loan Schedule, on which the Mortgage Interest Rate is
adjusted.
Interim Funder: With respect to each MERS Designated Mortgage
Loan, the Person named on the MERS System as the interim funder pursuant to
the MERS Procedures Manual.
Investor: With respect to each MERS Designated Mortgage Loan, the
Person named on the MERS System as the investor pursuant to the MERS
Procedures Manual.
Lifetime Rate Cap: The provision of each Mortgage Note related to
an Adjustable Rate Mortgage Loan which provides for an absolute maximum
Mortgage Interest Rate thereunder. The Mortgage Interest Rate during the term
of each Adjustable Rate Mortgage Loan shall not at any time exceed the
Mortgage Interest Rate at the time of origination of such Adjustable Rate
Mortgage Loan by more than the amount per annum set forth on the related
Mortgage Loan Schedule.
Liquidation Proceeds: The proceeds received in connection with the
liquidation of a defaulted Mortgage Loan, whether through the sale or
assignment of such Mortgage Loan, trustee's sale, foreclosure sale or
otherwise or the sale of the related Mortgaged Property if the Mortgaged
Property is acquired in satisfaction of the Mortgage Loan, other than amounts
received following the acquisition of REO Property, Insurance Proceeds and
Condemnation Proceeds and with respect to the liquidation of any defaulted
Second Lien Loans, net of any amount necessary to repay any related senior
mortgage loan, which amounts shall be retained by the Servicer from such
proceeds.
Loan-to-Value Ratio: With respect to any Mortgage Loan, as of any
date of determination, the ratio (expressed as a percentage) the numerator of
which is the outstanding principal balance of the Mortgage Loan as of the
related Cut-off Date (unless otherwise indicated), and the denominator of
which is the lesser of (a) the Appraised Value of the Mortgaged Property at
origination and (b) if the Mortgage Loan was made to finance the acquisition
of the related Mortgaged Property, the purchase price of the Mortgaged
Property.
LTV: Loan-to-Value Ratio.
Manufactured Home: A single family residential unit that is
constructed in a factory in sections in accordance with the Federal
Manufactured Home Construction and Safety Standards adopted on June 15, 1976,
by the Department of Housing and Urban Development ("HUD Code"), as amended in
2000, which preempts state and local building codes. Each unit is identified
by the presence of a HUD Plate/Compliance Certificate label. The sections are
then transported to the site and joined together and affixed to a pre-built
permanent foundation (which satisfies the manufacturer's requirements and all
state, county, and local building codes and regulations). The manufactured
home is built on a non-removable, permanent frame chassis that supports the
complete unit of walls, floors, and roof. The underneath part of the home may
have
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running gear (wheels, axles, and brakes) that enable it to be transported
to the permanent site. The wheels and hitch are removed prior to anchoring the
unit to the permanent foundation. The manufactured home must be classified as
real estate and taxed accordingly. The permanent foundation may be on land
owned by the mortgager or may be on leased land.
MERS: Mortgage Electronic Registration Systems, Inc., a Delaware
corporation, and its successors in interest.
MERS Designated Mortgage Loan: Mortgage Loans for which (a) the
Seller has designated or will designate MERS as, and has taken or will take
such action as is necessary to cause MERS to be, the mortgagee of record, as
nominee for the Seller, in accordance with the MERS Procedures Manual and (b)
the Seller has designated or will designate the Purchaser as the Investor on
the MERS System.
MERS Procedures Manual: The MERS Procedures Manual, as it may be
amended, supplemented or otherwise modified from time to time.
MERS Report: The report from the MERS System listing MERS
Designated Mortgage Loans and other information.
MERS System: MERS mortgage electronic registry system, as more
particularly described in the MERS Procedures Manual.
Monthly Payment: The scheduled monthly payment of principal and
interest on a Mortgage Loan.
Mortgage: With respect to a Mortgage Loan that is not a Co-op
Loan, the mortgage, deed of trust or other instrument securing a Mortgage
Note, which creates a first lien, in the case of a First Lien Loan, or a
second lien, in the case of a Second Lien Loan, on the related Mortgaged
Property. With respect to a Co-op Loan, the Security Agreement.
Mortgage File: With respect to any Mortgage Loan, the Mortgage
Loan Documents and the items listed in Exhibit 2 hereto and any additional
documents required to be added to the Mortgage File pursuant to this
Agreement.
Mortgage Interest Rate: With respect to each Mortgage Loan, the
annual rate at which interest accrues on such Mortgage Loan from time to time
in accordance with the provisions of the related Mortgage Note.
Mortgage Loan: An individual Mortgage Loan which is the subject of
this Agreement, each Mortgage Loan originally sold, assigned and transferred
pursuant to this Agreement and identified on the applicable Mortgage Loan
Schedule, which Mortgage Loan includes, without limitation, the Mortgage File,
the Monthly Payments, Principal Prepayments, Liquidation Proceeds,
Condemnation Proceeds, Insurance Proceeds, REO Disposition Proceeds, and all
other rights, benefits, proceeds and obligations arising from or in connection
with such Mortgage Loan, excluding replaced or repurchased mortgage loans.
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Mortgage Loan Documents: With respect to any Mortgage Loan, the
documents listed in Exhibit 1 hereto.
Mortgage Loan Package: Each pool of Mortgage Loans, which shall be
purchased by the Purchaser from the Seller from time to time on each Closing
Date.
Mortgage Loan Remittance Rate: With respect to each Mortgage Loan,
the annual rate of interest payable to the Purchaser, which shall be equal to
the related Mortgage Interest Rate minus the related Servicing Fee Rate.
Mortgage Loan Schedule: The schedule of Mortgage Loans setting
forth the following information with respect to each Mortgage Loan in the
related Mortgage Loan Package: (1) the Seller's Mortgage Loan identifying
number; (2) the Mortgagor's name; (3) the street address of the Mortgaged
Property including the city, state and zip code; (4) a code indicating whether
the Mortgaged Property is owner-occupied, investment property or a second
home; (5) the number and type of residential units constituting the Mortgaged
Property (e.g. single family residence, a two- to four-family dwelling,
condominium, planned unit development or cooperative); (6) the original months
to maturity or the remaining months to maturity from the related Cut-off Date,
in any case based on the original amortization schedule and, if different, the
maturity expressed in the same manner but based on the actual amortization
schedule; (7) the Loan-to-Value Ratio at origination; (8) the Mortgage
Interest Rate as of the related Cut-off Date; (9) the date on which the first
Monthly Payment was due on the Mortgage Loan and, if such date is not
consistent with the Due Date currently in effect, the Due Date; (10) the
stated maturity date; (11) the amount of the Monthly Payment as of the related
Cut-off Date; (12) the last payment date on which a payment was actually
applied to the outstanding principal balance; (13) the original principal
amount of the Mortgage Loan; (14) the principal balance of the Mortgage Loan
as of the close of business on the related Cut-off Date, after deduction of
payments of principal due and collected on or before the related Cut-off Date;
(15) with respect to each Mortgage Loan with a second lien behind it, the
combined principal balance of the Mortgage Loan and the applicable second lien
loan, at origination, (16) a code indicating whether there is a simultaneous
second; (17) with respect to Adjustable Rate Mortgage Loans, the Interest Rate
Adjustment Date; (18) with respect to Adjustable Rate Mortgage Loans, the
Gross Margin; (19) with respect to Adjustable Rate Mortgage Loans, the
Lifetime Rate Cap under the terms of the Mortgage Note; (20) with respect to
Adjustable Rate Mortgage Loans, a code indicating the type of Index; (21) the
type of Mortgage Loan (i.e., Fixed Rate, Adjustable Rate); (22) a code
indicating the purpose of the loan (i.e., purchase, rate/term refinance or
cash-out refinance); (23) a code indicating the documentation style (i.e. no
documents, full, alternative, reduced, no income/no asset, stated income, no
ration, reduced or NIV); (24) the loan credit classification (as described in
the Underwriting Guidelines); (25) whether such Mortgage Loan provides for a
Prepayment Penalty; (26) the Prepayment Penalty period of such Mortgage Loan,
if applicable; (27) a description of the Prepayment Penalty, if applicable;
(28) the Mortgage Interest Rate as of origination; (29) the credit risk score
(FICO score); (30) the date of origination; (31) with respect to Adjustable
Rate Mortgage Loans, the Mortgage Interest Rate adjustment period; (32) with
respect to Adjustable Rate Mortgage Loans, the Mortgage Interest Rate
adjustment percentage; (33) with respect to Adjustable Rate Mortgage Loans,
the Mortgage Interest Rate floor; (34) the Mortgage Interest Rate calculation
method (i.e., 30/360, simple interest, other); (35) with respect to Adjustable
Rate Mortgage Loans, the Periodic Rate Cap as
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of the first Interest Rate Adjustment Date; (36) a code indicating whether the
Mortgage Loan is a Balloon Mortgage Loan; (37) the original Monthly Payment
due; (38) the Appraised Value; (39) a code indicating whether the Mortgage
Loan is covered by a PMI Policy and, if so, identifying the PMI Policy
provider; (40) in connection with a condominium unit, a code indicating
whether the condominium project where such unit is located is low-rise or
high-rise; (39) a code indicating whether the Mortgaged Property is a
leasehold estate; (41) a code indicating whether the Mortgage Loan is a MERS
Designated Mortgage Loan; (42) the MERS Identification Number, if applicable,
(43) a code indicating if a Mortgage Loan is a Covered Loan, and (44) the
product type of Mortgage Loan (i.e., Fixed Rate, Adjustable Rate, First Lien
Loan or Second Lien Loan), and with respect to each Second Lien Loan, the
product type of the related first lien loan. With respect to the Mortgage
Loans in the aggregate, the related Mortgage Loan Schedule shall set forth the
following information, as of the related Cut-off Date: (1) the number of
Mortgage Loans; (2) the current aggregate outstanding principal balance of the
Mortgage Loans; (3) the weighted average Mortgage Interest Rate of the
Mortgage Loans; (4) the weighted average maturity of the Mortgage Loans; (5)
the average principal balance of the Mortgage Loans; (6) the applicable
Cut-off Date; and (7) the applicable Closing Date.
Mortgage Note: The original executed note or other evidence of the
Mortgage Loan indebtedness of a Mortgagor, including any riders or addenda
thereto.
Mortgaged Property: With respect to a Mortgage Loan that is not a
Co-op Loan, the Mortgagor's real property securing repayment of a related
Mortgage Note, consisting of an unsubordinated estate in fee simple or, with
respect to real property located in jurisdictions in which the use of
leasehold estates for residential properties is a widely-accepted practice, a
leasehold estate, in a single parcel or multiple parcels of real property
improved by a Residential Dwelling. With respect to a Co-op Loan, the stock
allocated to a dwelling unit in the residential cooperative housing
corporation that was pledged to secure such Co-op Loan and the related Co-op
Lease.
Mortgagee: The mortgagee or beneficiary named in the Mortgage and
the successors and assigns of such mortgagee or beneficiary.
Mortgagor: The obligor on a Mortgage Note, who is an owner of the
Mortgaged Property and the grantor or mortgagor named in the Mortgage and such
grantor's or mortgagor's successors in title to the Mortgaged Property.
NAIC: The National Association of Insurance Commissioners or any
successor thereto.
OCC: Office of the Comptroller of the Currency, or any successor
thereto.
Officer's Certificate: A certificate signed by the Chairman of the
Board, the Vice Chairman of the Board, a President or a Vice President and by
the Treasurer, the Secretary, or one of the Assistant Treasurers or the
Assistant Secretaries of the Person on behalf of whom such certificate is
being delivered.
Opinion of Counsel: A written opinion of counsel, who may be
counsel for the Seller or the Servicer, reasonably acceptable to the
Purchaser, provided that any Opinion of
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Counsel relating to (a) the qualification of any account required to be
maintained pursuant to this Agreement as an eligible account, (b)
qualification of the Mortgage Loans in a REMIC or (c) compliance with the
REMIC Provisions, must be (unless otherwise stated in such Opinion of Counsel)
an opinion of counsel who (i) is in fact independent of the Seller and any
servicer of the Mortgage Loans, (ii) does not have any material direct or
indirect financial interest in the Seller or Servicer or in an Affiliate of
either and (iii) is not connected with the Seller or Servicer as an officer,
employee, director or person performing similar functions.
OTS: The Office of Thrift Supervision or any successor thereto.
Owner: As defined in Subsection 11.12.
P&I Advance: As defined in Subsection 11.16.
Payment Adjustment Date: As to each Adjustable Rate Mortgage Loan,
the date on which an adjustment to the Monthly Payment on a Mortgage Note
becomes effective.
Periodic Rate Cap: The provision of each Mortgage Note related to
an Adjustable Rate Mortgage Loan which provides for an absolute maximum amount
by which the Mortgage Interest Rate therein may increase or decrease on an
Interest Rate Adjustment Date above or below the Mortgage Interest Rate
previously in effect. The Periodic Rate Cap for each Adjustable Rate Mortgage
Loan is the rate set forth as such on the related Mortgage Loan Schedule.
Periodic Rate Floor: With respect to each Adjustable Rate Mortgage
Loan, the provision of each Mortgage Note which provides for an absolute
maximum amount by which the Mortgage Interest Rate therein may decrease on an
Interest Rate Adjustment Date below the Mortgage Interest Rate previously in
effect.
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 an insurer acceptable under the Underwriting Guidelines and qualified to do
business in the jurisdiction where the Mortgaged Property is located.
Preliminary Mortgage Schedule: As defined in Section 3.
Prepayment Penalty: With respect to each Mortgage Loan, the amount
of any premium or penalty required to be paid by the Mortgagor if the
Mortgagor prepays such Mortgage Loan as provided in the related Mortgage Note
or Mortgage.
Prime Rate: The prime rate announced to be in effect from time to
time, as published as the average rate in The 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,
including any Prepayment Penalty
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thereon, and which is not accompanied by an amount of interest representing
scheduled interest due on any date or dates in any month or months subsequent
to the month of prepayment.
Purchase Price: The price paid on the related Closing Date by the
Purchaser to the Seller in exchange for the Mortgage Loans purchased on such
Closing Date as calculated in Section 4 of this Agreement.
Purchase Price and Terms Agreement: Each of those certain
agreements setting forth the general terms and conditions of the purchase and
sale of the Mortgage Loans to be purchased from time to time hereunder, each
by and between the Seller and the Purchaser.
Purchase Price Percentage: The percentage of par (expressed as
decimal) set forth in the related Purchase Price and Terms Agreement.
Purchaser: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc., a New York
corporation, and its successors in interest and assigns, or any successor to
the Purchaser under this Agreement as herein provided.
Qualified Appraiser: An appraiser, duly appointed by the Seller,
who had no interest, direct or indirect, in the Mortgaged Property or in any
loan made on the security thereof, and whose compensation was not affected by
the approval or disapproval of the Mortgage Loan, and such appraiser and the
appraisal made by such appraiser both satisfied the requirements of Title XI
of FIRREA and the regulations promulgated thereunder, all as in effect on the
date the Mortgage Loan was originated.
Qualified Correspondent: Any Person from which the Seller
purchased Mortgage Loans, provided that the following conditions are
satisfied: (i) such Mortgage Loans were originated pursuant to an agreement
between the Seller and such Person that contemplated that such Person would
underwrite mortgage loans from time to time, for sale to the Seller, in
accordance with underwriting guidelines designated by the Seller ("Designated
Guidelines") or guidelines that do not vary materially from such Designated
Guidelines; (ii) such Mortgage Loans were in fact underwritten as described in
clause (i) above and were acquired by the Seller within 180 days after
origination; (iii) either (x) the Designated Guidelines were, at the time such
Mortgage Loans were originated, used by the Seller in origination of mortgage
loans of the same type as the Mortgage Loans for the Seller's own account or
(y) the Designated Guidelines were, at the time such Mortgage Loans were
underwritten, designated by the Seller on a consistent basis for use by
lenders in originating mortgage loans to be purchased by the Seller; and (iv)
the Seller employed, at the time such Mortgage Loans were acquired by the
Seller, pre-purchase or post-purchase quality assurance procedures (which may
involve, among other things, review of a sample of mortgage loans purchased
during a particular time period or through particular channels) designed to
ensure that Persons from which it purchased mortgage loans properly applied
the underwriting criteria designated by the Seller.
Qualified Substitute Mortgage Loan: A mortgage loan eligible to be
substituted by the Seller for a Deleted Mortgage Loan which must, on the date
of such substitution (i) have an unpaid principal balance, after deduction of
all scheduled payments due in the month of substitution (or in the case of a
substitution of more than one mortgage loan for a Deleted
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Mortgage Loan, an aggregate principal balance), not in excess of the unpaid
principal balance of the Deleted Mortgage Loan (the amount of any shortfall
will be deposited in the Custodial Account by the Seller in the month of
substitution); (ii) have a Mortgage Interest Rate not less than and not more
than one percent (1%) greater than the Mortgage Interest Rate of the Deleted
Mortgage Loan; (iii) have a remaining term to maturity not greater than and
not more than one (1) year less than that of the Deleted Mortgage Loan; (iv)
be of the same type as the Deleted Mortgage Loan (i.e., fixed rate or
adjustable rate with same Mortgage Interest Rate Cap and Index); (v) comply
with each representation and warranty (respecting individual Mortgage Loans)
set forth in Subsection 7.01 of this Agreement; (vi) be current in the payment
of principal and interest; (vii) be secured by a Mortgaged Property of the
same type and occupancy status as secured the Deleted Mortgage Loan; and
(viii) have payment terms that do not vary in any material respect from those
of the Deleted Mortgage Loan.
Reconstitution: Any Securitization Transaction or Whole Loan
Transfer.
Reconstitution Agreement: As defined in Section 15.
Record Date: The close of business of the last Business Day of the
month preceding the month of the related Remittance Date.
Refinanced Mortgage Loan: A Mortgage Loan the proceeds of which
were not used to purchase the related Mortgaged Property.
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended
from time to time, and subject to such clarification and interpretation as
have been provided by the Commission in the adopting release (Asset-Backed
Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531
(Jan. 7, 2005)) or by the staff of the Commission, or as may be provided by
the Commission or its staff from time to time.
Remittance Date: The 18th calendar day of any month (or, if such
18th calendar day is not a Business Day, the preceding Business Day).
REO Disposition: The final sale by the Servicer of an REO
Property.
REO Disposition Proceeds: All amounts received with respect to an
REO Disposition pursuant to Subsection 11.12.
REO Property: A Mortgaged Property acquired by the Servicer
through foreclosure or deed in lieu of foreclosure, as described in Subsection
11.12.
Repurchase Price: As defined in the related Purchase Price and
Terms Agreement.
Residential Dwelling: Any one of the following: (i) a detached
one-family dwelling, (ii) a detached two- to four-family dwelling, (iii) a
one-family dwelling unit in a condominium project, or (iv) a one-family
dwelling in a planned unit development, none of which is a co-operative,
mobile or Manufactured Home.
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Second Lien Loan: A Mortgage Loan secured by a second lien
Mortgage on the related Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Securitization Transaction: Any transaction involving either (1) a
sale or other transfer of some or all of the Mortgage Loans directly or
indirectly to an issuing entity in connection with an issuance of publicly
offered or privately placed, rated or unrated mortgage-backed securities or
(2) an issuance of publicly offered or privately placed, rated or unrated
securities, the payments on which are determined primarily by reference to one
or more portfolios of residential mortgage loans consisting, in whole or in
part, of some or all of the Mortgage Loans.
Security Agreement: The agreement creating a security interest in
the stock allocated to a dwelling unit in the residential cooperative housing
corporation that was pledged to secure such Co-op Loan and the related Co-op
Lease.
Seller: As defined in the initial paragraph of this Agreement,
together with its successors in interest.
Seller Information: As defined in Section 34.07(a).
Servicer: As defined in the initial paragraph of this Agreement,
together with its successors and assigns as permitted under the terms of this
Agreement, or with respect to Subsection 34.03(c), as defined therein.
Servicing Advances: All customary, reasonable and necessary
out-of-pocket costs and expenses incurred in the performance by the Servicer
of its servicing obligations, including, but not limited to, the cost of (i)
the preservation, restoration and protection of the Mortgaged Property, (ii)
any enforcement 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, and (iv) payments made by the
Servicer with respect to a Mortgaged Property pursuant to Subsection 11.08.
Servicing Criteria: The "servicing criteria" set forth in Item
1122(d) of Regulation AB, as such may be amended from time to time.
Servicing Fee: With respect to each Mortgage Loan, the servicing
fee specified in the applicable Purchase Price and Terms Agreement.
Servicing Fee Rate: With respect to each Mortgage Loan, the per
annum rate set forth in the applicable Purchase Price and Terms Agreement.
Servicing File: With respect to each Mortgage Loan, the portion of
the Mortgage File, excluding the Mortgage Loan Documents, retained by the
Servicer pursuant to the terms of this Agreement.
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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 to the Purchaser by the
Servicer, as such list may be amended from time to time.
Servicing Rights: Any and all of the following: (a) any and all
rights to service the Mortgage Loans; (b) any payments to or monies received
by the Seller for servicing the Mortgage Loans; (c) any late fees, penalties
or similar payments with respect to the Mortgage Loans; (d) all agreements or
documents creating, defining or evidencing any such servicing rights to the
extent they relate to such servicing rights and all rights of the Seller
thereunder; (e) Escrow Payments or other similar payments with respect to the
Mortgage Loans and any amounts actually collected by the Seller with respect
thereto; (f) all accounts and other rights to payment related to any of the
property described in this paragraph; and (g) any and all documents, files,
records, servicing files, servicing documents, servicing records, data tapes,
computer records, or other information pertaining to the Mortgage Loans or
pertaining to the past, present or prospective servicing of the Mortgage
Loans.
Sponsor: The sponsor, as such term is defined in Regulation AB,
with respect to any Securitization Transaction.
Standard & Poor's: Standard & Poor's Ratings Services, a division
of The ▇▇▇▇▇▇-▇▇▇▇ Companies Inc., and any successor thereto.
Standard & Poor's Glossary: The Standard & Poor's LEVELS(R)
Glossary, as may be in effect from time to time.
Stated Principal Balance: As to each Mortgage Loan as to any date
of determination, (i) the principal balance of the Mortgage Loan at the
related Cut-off Date after giving effect to payments of principal due on or
before such date, whether or not received, minus (ii) all amounts previously
distributed to the Purchaser with respect to the related Mortgage Loan
representing payments or recoveries of principal, or advances in lieu thereof
on such Mortgage Loan.
Static Pool Information: Static pool information as described in
Item 1105(a)(1)-(3) and 1105(c) of Regulation AB.
Subcontractor: Any vendor, subcontractor or other Person that is
not responsible for the overall servicing (as "servicing" is commonly
understood by participants in the mortgage-backed securities market) of
Mortgage Loans but performs one or more discrete functions identified in Item
1122(d) of Regulation AB with respect to Mortgage Loans under the direction or
authority of the Servicer or a Subservicer.
Subservicer: Any Person that services Mortgage Loans on behalf of
the Servicer or any Subservicer and is responsible for the performance
(whether directly or through Subservicers or Subcontractors) of a substantial
portion of the material servicing functions required to be performed by the
Seller under this Agreement or any Reconstitution Agreement that are
identified in Item 1122(d) of Regulation AB.
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Successor Servicer: Any servicer of one or more Mortgage Loans
designated by the Purchaser as being entitled to the benefits of the
indemnifications set forth in Subsections 7.03 and 12.01.
Third-Party Originator: Each Person, other than a Qualified
Correspondent, that originated Mortgage Loans acquired by the Seller.
Transfer Date: In the event the Servicer is terminated as servicer
of a Mortgage Loan pursuant to Subsections 12.04, 13.01, 14.01(c) or 14.02,
the date on which the Purchaser, or its designee, shall receive the transfer
of servicing responsibilities and begin to perform the servicing of such
Mortgage Loans, and the Servicer shall cease all servicing responsibilities.
Underwriting Guidelines: The underwriting guidelines of the
Seller, a copy of which is attached to the related Assignment and Conveyance.
Whole Loan Transfer: Any sale or transfer of some or all of the
Mortgage Loans, other than a Securitization Transaction.
Section 2. Purchase and Conveyance. The Seller agrees to sell from
time to time, and the Purchaser agrees to purchase from time to time, Mortgage
Loans having an aggregate principal balance on the related Cut-off Date in an
amount as set forth in the related Purchase Price and Terms Agreement, or in
such other amount as agreed by the Purchaser and the Seller as evidenced by
the actual aggregate principal balance of the Mortgage Loans accepted by the
Purchaser on each Closing Date, together with the related Mortgage Files and
all rights and obligations arising under the documents contained therein. The
Seller, simultaneously with the delivery of the Mortgage Loan Schedule with
respect to the related Mortgage Loan Package to be purchased on each Closing
Date, shall execute and deliver an Assignment and Conveyance Agreement in the
form attached hereto as Exhibit 14 (the "Assignment and Conveyance
Agreement").
With respect to each Mortgage Loan purchased, the Purchaser shall
own and be entitled to receive: (a) all scheduled principal due after the
related Cut-off Date, (b) all other payments and/or recoveries of principal
collected after the related Cut-off Date (provided, however, that all
scheduled payments of principal due on or before the related Cut-off Date and
collected by the Servicer after the related Cut-off Date shall belong to the
Seller), and (c) all payments of interest on the Mortgage Loans, net of the
Servicing Fee (minus that portion of any such interest payment that is
allocable to the period prior to the related Cut-off Date).
For the purposes of this Agreement, payments of scheduled
principal and interest prepaid for a Due Date beyond the related Cut-off Date
shall not be applied to reduce the Stated Principal Balance as of the related
Cut-off Date. Such prepaid amounts (minus the applicable Servicing Fee) shall
be the property of the Purchaser. The Seller shall remit to the Servicer for
deposit any such prepaid amounts into the Custodial Account, which account is
established for the benefit of the Purchaser, for remittance by the Servicer
to the Purchaser on the appropriate Remittance Date. All payments of principal
and interest, less the applicable Servicing Fee, due on a Due Date following
the related Cut-off Date shall belong to the Purchaser.
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Section 3. Mortgage Loan Schedule. The Seller from time to time
shall provide the Purchaser with certain information constituting a
preliminary listing of the Mortgage Loans to be purchased on each Closing Date
in accordance with the related Purchase Price and Terms Agreement and this
Agreement (each, a "Preliminary Mortgage Schedule").
The Seller shall deliver the related Mortgage Loan Schedule for
the Mortgage Loans to be purchased on a particular Closing Date to the
Purchaser at least five (5) Business Days prior to the related Closing Date.
The related Mortgage Loan Schedule shall be the related Preliminary Mortgage
Schedule with those Mortgage Loans which have not been funded prior to the
related Closing Date deleted.
Section 4. Purchase Price. The Purchase Price for each Mortgage
Loan shall be the percentage of par as stated in the related Purchase Price
and Terms Agreement (subject to adjustment as provided therein). The initial
principal amount of the related Mortgage Loans shall be the aggregate
principal balance of the Mortgage Loans, so computed as of the related Cut-off
Date. If so provided in the related Purchase Price and Terms Agreement,
portions of the Mortgage Loans shall be priced separately.
In addition to the Purchase Price as described above, the
Purchaser shall pay to the Seller, at closing, accrued interest on the current
principal amount of the related Mortgage Loans as of the related Cut-off Date
at the weighted average Mortgage Interest Rate of those Mortgage Loans. The
Purchase Price plus accrued interest as set forth in the preceding paragraph
shall be paid to the Seller by wire transfer of immediately available funds to
an account designated by the Seller in writing.
Section 5. Examination of Mortgage Files. At least ten (10)
Business Days prior to the related Closing Date, the Seller shall either (a)
deliver to the Purchaser or its designee in escrow, for examination with
respect to each Mortgage Loan to be purchased, the related Mortgage File,
including a copy of the Assignment of Mortgage, pertaining to each Mortgage
Loan, or (b) make the related Mortgage File available to the Purchaser for
examination at such other location as shall otherwise be acceptable to the
Purchaser. Such examination of the Mortgage Files may be made by the Purchaser
or its designee at any reasonable time. If the Purchaser makes such
examination prior to the related Closing Date and determines, in its sole
discretion, that any Mortgage Loans are unacceptable to the Purchaser for any
reason, such Mortgage Loans shall be deleted from the related Mortgage Loan
Schedule, and such Deleted Mortgage Loan (or Loans) may be replaced by a
Qualified Substitute Mortgage Loan (or Loans) acceptable to the Purchaser. The
Purchaser may, at its option and without notice to the Seller, purchase some
or all of the Mortgage Loans without conducting any partial or complete
examination. The fact that the Purchaser or its designee has conducted or has
failed to conduct any partial or complete examination of the Mortgage Files
shall not affect the Purchaser's (or any of its successor's) rights to demand
repurchase, substitution or other relief as provided herein.
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Section 6. Delivery of Mortgage Loan Documents.
Subsection 6.01 Possession of Mortgage Files. The contents of
each Mortgage File required to be retained by or delivered to the Servicer to
service the Mortgage Loans pursuant to this Agreement and thus not delivered
to the Purchaser, or its designee, are and shall be held in trust by the
Servicer for the benefit of the Purchaser as the owner thereof. The Servicer's
possession of any portion of each such Mortgage File is at the will of the
Purchaser for the sole purpose of facilitating servicing of the Mortgage Loans
pursuant to this Agreement, and such retention and possession by the Servicer
for so long as the Servicer is servicing such Mortgage Loans. The ownership of
each Mortgage Note, each Mortgage and the contents of each Mortgage File is
vested in the Purchaser and the ownership of all records and documents with
respect to the related Mortgage Loan prepared by or which come into the
possession of the Servicer shall immediately vest in the Purchaser and shall
be retained and maintained, in trust, by the Servicer at the will of the
Purchaser in such custodial capacity only. The Mortgage File retained by the
Servicer with respect to each Mortgage Loan pursuant to this Agreement shall
be appropriately identified in the Servicer's computer system and/or books and
records to reflect clearly the sale of such related Mortgage Loan to the
Purchaser. The Servicer shall release from its custody the contents of any
Mortgage File retained by it only in accordance with this Agreement, except
when such release is required in connection with a repurchase of any such
Mortgage Loan pursuant to Subsection 7.03 or if required under applicable law
or court order.
Subsection 6.02 Books and Records. Record title to each Mortgage
and the related Mortgage Note as of the related Closing Date shall be in the
name of the Seller; provided, however, that if a Mortgage has been recorded in
the name of MERS or its designee, the Seller is shown as the owner of the
related Mortgage Loan on the records of MERS for purposes of the system of
recording transfers of beneficial ownership of mortgages maintained by MERS.
Notwithstanding the foregoing, ownership of each Mortgage and the related
Mortgage Note shall be vested solely in the Purchaser or the appropriate
designee of the Purchaser, as the case may be. All rights arising out of the
Mortgage Loans including, but not limited to, all funds received by the
Servicer after the related Cut-off Date on or in connection with a Mortgage
Loan as provided in Section 2 shall be vested in the Purchaser or one or more
designees of the Purchaser; provided, however, that all such funds received on
or in connection with a Mortgage Loan as provided in Section 2 shall be
received and held by the Servicer in trust for the benefit of the Purchaser or
the appropriate designee of the Purchaser, as the case may be, as the owner of
the Mortgage Loans pursuant to the terms of this Agreement.
It is the express intention of the parties that the transactions
contemplated by this Agreement be, and be construed as, a sale of the related
Mortgage Loans by the Seller and not a pledge of such Mortgage Loans by the
Seller to the Purchaser to secure a debt or other obligation of the Seller.
Consequently, the sale of each Mortgage Loan shall be reflected as a purchase
on the Purchaser's business records, tax returns and financial statements, and
as a sale of assets on the Seller's business records, tax returns and
financial statements.
Subsection 6.03 Delivery of Mortgage Loan Documents. The Seller
shall, at least two (2) Business Days prior to the related Closing Date (or
such later date as the Purchaser may reasonably request), deliver and release
to the Purchaser, or its designee, the
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Mortgage Loan Documents with respect to each Mortgage Loan pursuant to a
bailee letter agreement. In connection with the foregoing, the Seller shall
indemnify the Purchaser and its present and former directors, officers,
employees and agents and any Successor Servicer and its present and former
directors, officers, employees and agents, and hold such parties harmless
against any losses, damages, penalties, fines, forfeitures, reasonable legal
fees and expenses and related costs, judgments, and other costs and expenses
based on or grounded upon, or resulting from, the fact that any Mortgage Loan
is not covered by an ALTA or CLTA lender's title insurance policy. For
purposes of the previous sentence, "Purchaser" shall mean the Person then
acting as the Purchaser under this Agreement and any and all Persons who
previously were "Purchasers" under this Agreement and "Successor Servicer"
shall mean any Person designated as the Successor Servicer pursuant to this
Agreement and any and all Persons who previously were "Successor Servicers"
pursuant to this Agreement.
To the extent received by it, the Servicer shall forward to the
Purchaser, or its designee, original documents evidencing an assumption,
modification, consolidation or extension of any Mortgage Loan entered into in
accordance with this Agreement within two (2) weeks after their execution;
provided, however, that the Servicer shall provide the Purchaser, or its
designee, with a copy, certified by the Servicer as a true copy, of any such
document submitted for recordation within two (2) weeks after its execution,
and shall promptly provide the original of any document submitted for
recordation or a copy of such document certified by the appropriate public
recording office to be a true and complete copy of the original within two (2)
weeks following receipt of the original document by the Servicer; provided,
however, that such original recorded document or certified copy thereof shall
be delivered to the Purchaser no later than 180 days following the related
Closing Date, unless there has been a delay at the applicable recording
office.
If the original or copy of any document submitted for recordation
to the appropriate public recording office is not delivered to the Purchaser
or its designee within 180 days following the related Closing Date, the
related Mortgage Loan shall, upon the request of the Purchaser, be repurchased
by the Seller at the price and in the manner specified in Subsection 7.03. The
foregoing repurchase obligation shall not apply if the Seller cannot cause the
Servicer to deliver such original or copy of any document submitted for
recordation to the appropriate public recording office within the specified
period due to a delay caused by the recording office in the applicable
jurisdiction; provided that (i) the Servicer shall instead deliver a recording
receipt of such recording office or, if such recording receipt is not
available, an officer's certificate of a servicing officer of the Servicer,
confirming that such document has been accepted for recording, and (ii) such
document is delivered within twelve (12) months of the related Closing Date.
In connection with any recordings required under applicable law,
the Seller shall pay all initial recording fees, if any, for the Assignments
of Mortgage and any other fees or costs in transferring all original documents
to the Custodian or, upon written request of the Purchaser, to the Purchaser
or the Purchaser's designee. The Purchaser or the Purchaser's designee shall
be responsible for recording the Assignments of Mortgage and shall be
reimbursed by the Seller for the reasonable costs associated therewith
pursuant to the preceding sentence.
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Subsection 6.04 MERS Designated Loans. With respect to each MERS
Designated Mortgage Loan, the Seller shall, on or prior to the related Closing
Date, designate the Purchaser as the Investor and the Custodian as custodian,
and no Person shall be listed as Interim Funder on the MERS System. In
addition, on or prior to the related Closing Date, Seller shall provide the
Custodian and the Purchaser with a MERS Report listing the Purchaser as the
Investor, the Custodian as custodian and no Person listed as Interim Funder
with respect to each MERS Designated Mortgage Loan.
Section 7. Representations, Warranties and Covenants; Remedies for
Breach.
Subsection 7.01 Representations and Warranties Regarding
Individual Mortgage Loans. The Seller hereby represents and warrants to the
Purchaser that, as to each Mortgage Loan, as of the related Closing Date for
such Mortgage Loan:
(a) Mortgage Loans as Described. The information set forth in the
related Mortgage Loan Schedule is complete, true and correct;
(b) Payments Current. All payments required to be made up to the
related Closing Date for the Mortgage Loan under the terms of the
Mortgage Note have been made and credited. No payment required under the
Mortgage Loan is 30 days or more delinquent nor has any payment under the
Mortgage Loan been 30 days or more delinquent at any time since the
origination of the Mortgage Loan;
(c) No Outstanding Charges. There are no defaults in complying
with the terms of the Mortgage, and all taxes, governmental assessments,
insurance premiums, ground rents, leasehold payments, water, sewer and
municipal charges, leasehold payments or ground rents which previously
became due and owing have been paid, or an escrow of funds has been
established in an amount sufficient to pay for every such item which
remains unpaid and which has been assessed but is not yet due and
payable. The Seller has not advanced funds, or induced, solicited or
knowingly received any advance of funds by a party other than the
Mortgagor, directly or indirectly, for the payment of any amount required
under the Mortgage Loan, except for interest accruing from the date of
the Mortgage Note or date of disbursement of the Mortgage Loan proceeds,
whichever is greater, to the day which precedes by one month the related
Due Date of the first installment of principal and interest;
(d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any
respect, from the date of origination except by a written instrument
which has been recorded, if necessary to protect the interests of the
Purchaser, and which has been delivered to the Custodian or to such other
Person as the Purchaser shall designate in writing, and the terms of
which are reflected in the related Mortgage Loan Schedule. The substance
of any such waiver, alteration or modification has been approved by the
issuer of any related PMI Policy and the title insurer, if any, to the
extent required by the policy, and its terms are reflected on the related
Mortgage Loan Schedule, if applicable. No instrument of waiver,
alteration or modification has been executed, and no Mortgagor has been
released, in whole or in part, except in connection with an assumption
agreement, approved by the issuer of any related
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PMI Policy and the title insurer, to the extent required by the policy,
and which assumption agreement is part of the Mortgage Loan File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the related
Mortgage Loan Schedule;
(e) No Defenses. The Mortgage Loan is not subject to any right of
rescission, set-off, counterclaim or defense, including without
limitation the defense of usury, nor will the operation of any of the
terms of the Mortgage Note or the Mortgage, or the exercise of any right
thereunder, render either the Mortgage Note or the Mortgage
unenforceable, in whole or in part, or subject to any right of
rescission, set-off, counterclaim or defense, including without
limitation the defense of usury, and no such right of rescission,
set-off, counterclaim or defense has been asserted with respect thereto,
and no Mortgagor was a debtor in any state or federal bankruptcy or
insolvency proceeding at the time the Mortgage Loan was originated;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured
by a generally acceptable insurer against loss by fire, hazards of
extended coverage and such other hazards as are provided for in the
Underwriting Guidelines. If required by the National Flood Insurance Act
of 1968, as amended, each Mortgage Loan is covered by a flood insurance
policy meeting the requirements of the current guidelines of the Federal
Insurance Administration as in effect which policy conforms with the
Underwriting Guidelines. All individual insurance policies contain a
standard mortgagee clause naming the Seller and its successors and
assigns as mortgagee, and all premiums thereon have been paid. The
Mortgage obligates the Mortgagor thereunder to maintain the hazard
insurance policy at the Mortgagor's cost and expense, and on the
Mortgagor's failure to do so, authorizes the holder of the Mortgage to
obtain and maintain such insurance at such Mortgagor's cost and expense,
and to seek reimbursement therefor from the Mortgagor. Where required by
state law or regulation, the Mortgagor has been given an opportunity to
choose the carrier of the required hazard insurance, provided the policy
is not a "master" or "blanket" hazard insurance policy covering a
condominium, or any hazard insurance policy covering the common
facilities of a planned unit development. The hazard insurance policy is
the valid and binding obligation of the insurer, is in full force and
effect, and will be in full force and effect and inure to the benefit of
the Purchaser upon the consummation of the transactions contemplated by
this Agreement. The insurance policy provides for advance notice to the
Seller or Servicer if the policy is canceled or not renewed, or if any
other change that adversely affects the Seller's interests is made; the
certificate includes the types and amounts of coverage provided,
describes any endorsements that are part of the "master" policy and would
be acceptable pursuant to the ▇▇▇▇▇▇ ▇▇▇ Guides. The Seller has not
engaged in, and has no knowledge of the Mortgagor, any Subservicer or any
prior originator or subservicer's having engaged in, any act or omission
which would impair the coverage of any such policy, the benefits of the
endorsement provided for herein, or the validity and binding effect of
either including, without limitation, no unlawful fee, commission,
kickback or other unlawful compensation or value of any kind has been or
will be received, retained or realized by any attorney, firm or other
person or entity, and no such unlawful items have been received, retained
or realized by the Seller;
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(g) Compliance with Applicable Laws. Any and all requirements of
any federal, state or local law applicable to the origination or
servicing of the Mortgage Loans, including, without limitation, usury,
truth-in-lending, real estate settlement procedures, consumer credit
protection, predatory and abusive lending, equal credit opportunity and
disclosure laws applicable to the Mortgage Loans, including, without
limitation, any provisions relating to a Prepayment Penalty have been
complied with, the consummation of the transactions contemplated hereby
will not involve the violation of any such laws or regulations, and the
Seller shall maintain in its possession, available for the Purchaser's
inspection, and shall deliver to the Purchaser upon demand, evidence of
compliance with all such requirements. This representation and warranty
is a Deemed Material and Adverse Representation;
(h) No Satisfaction of Mortgage. The Mortgage has not been
satisfied, canceled, subordinated or rescinded, in whole or in part, and
the Mortgaged Property has not been released from the lien of the
Mortgage, in whole or in part, nor has any instrument been executed that
would effect any such release, cancellation, subordination or rescission.
The Seller has not waived the performance by the Mortgagor of any action,
if the Mortgagor's failure to perform such action would cause the
Mortgage Loan to be in default, nor has the Seller waived any default
resulting from any action or inaction by the Mortgagor;
(i) Type of Mortgaged Property. With respect to a Mortgage Loan
that is not a Co-op Loan and is not secured by an interest in a leasehold
estate, the Mortgaged Property is a fee simple estate that consists of a
single parcel of real property with a detached single family residence
erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a condominium project, or an individual
unit in a planned unit development (or, with respect to each Co-op Loan,
an individual unit in a residential cooperative housing corporation);
provided, however, that any condominium unit, planned unit development or
residential cooperative housing corporation shall conform with the
Underwriting Guidelines. No portion of the Mortgaged Property (or
underlying Mortgaged Property, in the case of a Co-op Loan) is used for
commercial purposes, and since the date of origination, no portion of the
Mortgaged Property has been used for commercial purposes; provided, that
Mortgaged Properties which contain a home office shall not be considered
as being used for commercial purposes as long as the Mortgaged Property
has not been altered for commercial purposes and is not storing any
chemicals or raw materials other than those commonly used for homeowner
repair, maintenance and/or household purposes. None of the Mortgaged
Properties are Manufactured Homes, log homes, mobile homes, geodesic
domes or other unique property types. This representation and warranty is
a Deemed Material and Adverse Representation;
(j) Valid First or Second Lien. The Mortgage is a valid,
subsisting, enforceable and perfected, first lien (with respect to a
First Lien Loan) or second lien (with respect to a Second Lien Loan) on
the Mortgaged Property, including all buildings and improvements on the
Mortgaged Property and all installations and mechanical, electrical,
plumbing, heating and air conditioning systems located in or annexed to
such
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buildings, and all additions, alterations and replacements made at any
time with respect to the foregoing. The lien of the Mortgage is subject
only to:
(i) with respect to a Second Lien Loan only, the lien on the
first mortgage on the Mortgaged Property;
(ii) the lien of current real property taxes and assessments
not yet due and payable;
(iii) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date of
recording acceptable to prudent mortgage lending institutions
generally and specifically referred to in the lender's title
insurance policy delivered to the originator of the Mortgage Loan
and (a) specifically referred to or otherwise considered in the
appraisal made for the originator of the Mortgage Loan or (b) which
do not adversely affect the Appraised Value of the Mortgaged
Property set forth in such appraisal; and
(iv) other matters to which like properties are commonly
subject which do not materially interfere with the benefits of the
security intended to be provided by the Mortgage or the use,
enjoyment, value or marketability of the related Mortgaged Property.
Any security agreement, chattel mortgage or equivalent document
related to and delivered in connection with the Mortgage Loan establishes and
creates a valid, subsisting, enforceable and perfected first lien (with
respect to a First Lien Loan) or second lien (with respect to a Second Lien
Loan) and first priority (with respect to a First Lien Loan) or second
priority (with respect to a Second Lien Loan) security interest on the
property described therein and the Seller has full right to sell and assign
the same to the Purchaser.
With respect to any Co-op Loan, the related Mortgage is a valid,
subsisting and enforceable first priority security interest on the related
cooperative shares securing the Mortgage Note, subject only to (a) liens of
the related residential cooperative housing corporation for unpaid assessments
representing the Mortgagor's pro rata share of the related residential
cooperative housing corporation's payments for its blanket mortgage, current
and future real property taxes, insurance premiums, maintenance fees and other
assessments to which like collateral is commonly subject and (b) other matters
to which like collateral is commonly subject which do not materially interfere
with the benefits of the security interest intended to be provided by the
related Security Agreement;
(k) Validity of Mortgage Documents. The Mortgage Note and the
Mortgage and any other agreement executed and delivered by a Mortgagor in
connection with a Mortgage Loan are genuine, and each is the legal, valid
and binding obligation of the maker thereof enforceable in accordance
with its terms (including, without limitation, any provisions therein
relating to Prepayment Penalties). All parties to the Mortgage Note, the
Mortgage and any other such related agreement had legal capacity to enter
into the Mortgage Loan and to execute and deliver the Mortgage Note, the
Mortgage and any such agreement, and the Mortgage Note, the Mortgage and
any other such related
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agreement have been duly and properly executed by other such related
parties. No fraud, error, omission, misrepresentation, negligence or
similar occurrence with respect to a Mortgage Loan has taken place on the
part of the Seller in connection with the origination of the Mortgage
Loan or in the application of any insurance in relation to such Mortgage
Loan. The documents, instruments and agreements submitted for loan
underwriting were not falsified and contain no untrue statement of
material fact or omit to state a material fact required to be stated
therein or necessary to make the information and statements therein not
misleading. No fraud, error, omission, misrepresentation, negligence or
similar occurrence with respect to a Mortgage Loan has taken place on the
part of any Person, including without limitation, the Mortgagor, any
appraiser, any builder or developer, or any other party involved in the
origination of the Mortgage Loan or in the application for any insurance
in relation to such Mortgage Loan. The Seller has reviewed all of the
documents constituting the Servicing File and has made such inquiries as
it deems necessary to make and confirm the accuracy of the
representations set forth herein;
(l) Full Disbursement of Proceeds. The Mortgage Loan has been
closed and the proceeds of the Mortgage Loan have been fully disbursed
and there is no requirement for future advances thereunder, and any and
all requirements as to completion of any on-site or off-site improvement
and as to disbursements of any escrow funds therefor have been complied
with. All costs, fees and expenses incurred in making or closing the
Mortgage Loan and the recording of the Mortgage were paid, and the
Mortgagor is not entitled to any refund of any amounts paid or due under
the Mortgage Note or Mortgage;
(m) Ownership. The Seller is the sole owner of record and holder
of the Mortgage Loan and the indebtedness evidenced by each Mortgage Note
and upon the sale of the Mortgage Loans to the Purchaser, the Seller will
retain the Mortgage Files or any part thereof with respect thereto not
delivered to the Custodian, the Purchaser or the Purchaser's designee, in
trust only for the purpose of servicing and supervising the servicing of
each Mortgage Loan. The Mortgage Loan is not assigned or pledged, and the
Seller has good, indefeasible and marketable title thereto, and has full
right to transfer and sell the Mortgage Loan to the Purchaser free and
clear of any encumbrance, equity, participation interest, lien, pledge,
charge, claim or security interest, and has full right and authority
subject to no interest or participation of, or agreement with, any other
party, to sell and assign each Mortgage Loan pursuant to this Agreement
and following the sale of each Mortgage Loan, the Purchaser will own such
Mortgage Loan free and clear of any encumbrance, equity, participation
interest, lien, pledge, charge, claim or security interest, except as may
be required of the Servicer in its capacity as servicer of such Mortgage
Loan prior to the Transfer Date. The Seller intends to relinquish all
rights to possess, control and monitor the Mortgage Loan, except as may
be required of the Seller in its capacity as Servicer of such Mortgage
Loan. After the related Closing Date, the Seller will have no right to
modify or alter the terms of the sale of the Mortgage Loan and the Seller
will have no obligation or right to repurchase the Mortgage Loan or
substitute another Mortgage Loan, except as provided in this Agreement;
(n) Doing Business. All parties which have had any legal interest
in the Mortgage Loan, whether as mortgagee, assignee, pledgee or
otherwise, are (or, during the
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period in which they held and disposed of such interest, were) (1) in
compliance with any and all applicable licensing requirements of the laws
of the state wherein the Mortgaged Property is located, and any
qualification requirements of ▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇ ▇▇▇, as applicable,
and (2) either (i) organized under the laws of such state, or (ii)
qualified to do business in such state, or (iii) a federal savings and
loan association, a savings bank or a national bank having a principal
office in such state, or (3) not doing business in such state;
(o) CLTV, LTV, PMI Policy. No Mortgage Loan that is a Second Lien
Loan has a CLTV greater than 100%. No Mortgage Loan has an LTV greater
than 100%. Any Mortgage Loan that had at the time of origination an LTV
in excess of 80% is insured as to payment defaults by a PMI Policy. Any
PMI Policy in effect covers the related Mortgage Loan for the life of
such Mortgage Loan. All provisions of such PMI Policy have been and are
being complied with, such policy is in full force and effect, and all
premiums due thereunder have been paid. No action, inaction, or event has
occurred and no state of facts exists that has, or will result in the
exclusion from, denial of, or defense to coverage. Any Mortgage Loan
subject to a PMI Policy obligates the Mortgagor thereunder to maintain
the PMI Policy and to pay all premiums and charges in connection
therewith. The Mortgage Interest Rate for the Mortgage Loan as set forth
on the related Mortgage Loan Schedule is net of any such insurance
premium if the related PMI Policy is lender-paid;
(p) Title Insurance. With respect to a Mortgage Loan which is not
a Co-op Loan, the Mortgage Loan is covered by an ALTA lender's title
insurance policy or other generally acceptable form of policy or
insurance acceptable under the Underwriting Guidelines and each such
title insurance policy is issued by a title insurer acceptable under the
Underwriting Guidelines and qualified to do business in the jurisdiction
where the Mortgaged Property is located, insuring the Seller, its
successors and assigns, as to the first (with respect to a First Lien
Loan) or second (with respect to a Second Lien Loan) priority lien of the
Mortgage in the original principal amount of the Mortgage Loan, subject
only to the exceptions contained in clauses (i) and (ii) of clause (j) of
this Subsection 7.02, and in the case of Adjustable Rate Mortgage Loans,
against any loss by reason of the invalidity or unenforceability of the
lien resulting from the provisions of the Mortgage providing for
adjustment to the Mortgage Interest Rate and Monthly Payment. Where
required by state law or regulation, the Mortgagor has been given the
opportunity to choose the carrier of the required mortgage title
insurance. Additionally, such lender's title insurance policy
affirmatively insures ingress and egress, and against encroachments by or
upon the Mortgaged Property or any interest therein. The Seller, its
successor and assigns, are the sole insureds of such lender's title
insurance policy, and such lender's title insurance policy is valid and
remains in full force and effect and will be in force and effect upon the
consummation of the transactions contemplated by this Agreement. No
claims have been made under such lender's title insurance policy, and no
prior holder of the related Mortgage, including the Seller, has done, by
act or omission, anything which would impair the coverage of such
lender's title insurance policy, including without limitation, no
unlawful fee, commission, kickback or other unlawful compensation or
value of any kind has been or will be received, retained or realized by
any attorney, firm
-25-
or other person or entity, and no such unlawful items have been received,
retained or realized by the Seller;
(q) No Defaults. Other than payments due but not yet 30 days or
more delinquent, there is no default, breach, violation or event which
would permit acceleration existing under the Mortgage or the Mortgage
Note and no event which, with the passage of time or with notice and the
expiration of any grace or cure period, would constitute a default,
breach, violation or event which would permit acceleration, and neither
the Seller nor any of its affiliates nor any of their respective
predecessors, have waived any default, breach, violation or event which
would permit acceleration;
(r) No Mechanics' Liens. There are no mechanics' or similar liens
or claims which have been filed for work, labor or material (and no
rights are outstanding that under law could give rise to such liens)
affecting the related Mortgaged Property which are or may be liens prior
to, or equal or coordinate with, the lien of the related Mortgage;
(s) Location of Improvements; No Encroachments. All improvements
which were considered in determining the Appraised Value of the Mortgaged
Property lay wholly within the boundaries and building restriction lines
of the Mortgaged Property, and no improvements on adjoining properties
encroach upon the Mortgaged Property. No improvement located on or being
part of the Mortgaged Property is in violation of any applicable zoning
law or regulation;
(t) Origination; Payment Terms. The Mortgage Loan was originated
by a mortgagee approved by the Secretary of Housing and Urban Development
pursuant to Sections 203 and 211 of the National Housing Act, a savings
and loan association, a savings bank, a commercial bank, credit union,
insurance company or other similar institution which is supervised and
examined by a federal or state authority. Principal payments on the
Mortgage Loan commenced no more than seventy days after funds were
disbursed in connection with the Mortgage Loan. The Mortgage Interest
Rate as well as, in the case of an Adjustable Rate Mortgage Loan, the
Lifetime Rate Cap and the Periodic Cap are as set forth on the related
Mortgage Loan Schedule. The Mortgage Interest Rate is payable in equal
monthly installments of principal and interest, which installments of
interest, with respect to Adjustable Rate Mortgage Loans, are subject to
change due to the adjustments to the Mortgage Interest Rate on each
Interest Rate Adjustment Date, with interest calculated and payable in
arrears, sufficient to amortize the Mortgage Loan fully by the stated
maturity date, over an original term of not more than thirty (30) years
from commencement of amortization. Unless otherwise specified on the
related Mortgage Loan Schedule, the Mortgage Loan is payable on the first
day of each month. The Mortgage Loan does not require a balloon payment
on its stated maturity date; and by its original terms or any
modification thereof, does not provide for amortization beyond its
scheduled maturity date;
(u) Customary Provisions. The Mortgage contains customary and
enforceable provisions such as to render the rights and remedies of the
holder thereof adequate for the realization against the Mortgaged
Property of the benefits of the security provided thereby, including, (i)
in the case of a Mortgage designated as a deed of trust, by trustee's
-26-
sale, and (ii) otherwise by judicial foreclosure. Upon default by a
Mortgagor on a Mortgage Loan and foreclosure on, or trustee's sale of,
the Mortgaged Property pursuant to the proper procedures, the holder of
the Mortgage Loan will be able to deliver good and merchantable title to
the Mortgaged Property. There is no homestead or other exemption
available to a Mortgagor which would interfere with the right to sell the
Mortgaged Property at a trustee's sale or the right to foreclose the
Mortgage, subject to applicable federal and state laws and judicial
precedent with respect to bankruptcy and right of redemption or similar
law;
(v) Conformance with Agency and Underwriting Guidelines. The
Mortgage Loan was underwritten in accordance with the Underwriting
Guidelines (a copy of which is attached to the related Assignment and
Conveyance as Exhibit C). The Mortgage Loan is in conformity with the
standards of ▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇ Mae under one of their respective home
mortgage purchase programs (except that the principal balance of certain
Mortgage Loans may have exceeded the limits of ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇
Mac). The Mortgage Note and Mortgage are on forms acceptable to ▇▇▇▇▇▇▇
Mac or ▇▇▇▇▇▇ ▇▇▇ and no representations have been made to a Mortgagor
that are inconsistent with the mortgage instruments used;
(w) Occupancy of the Mortgaged Property. The Mortgaged Property is
lawfully occupied under applicable law. All inspections, licenses and
certificates required to be made or issued with respect to all occupied
portions of the Mortgaged Property and, with respect to the use and
occupancy of the same, including but not limited to certificates of
occupancy and fire underwriting certificates, have been made or obtained
from the appropriate authorities. Unless otherwise specified on the
related Mortgage Loan Schedule, the Mortgagor represented at the time of
origination of the Mortgage Loan that the Mortgagor would occupy the
Mortgaged Property as the Mortgagor's primary residence;
(x) No Additional Collateral. The Mortgage Note is not and has not
been secured by any collateral except the lien of the corresponding
Mortgage and the security interest of any applicable security agreement
or chattel mortgage referred to in clause (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed
of trust, a trustee, authorized and duly qualified under applicable law
to serve as such, has been properly designated and currently so serves
and is named in the Mortgage, and no fees or expenses are or will become
payable by the Purchaser to the trustee under the deed of trust, except
in connection with a trustee's sale after default by the Mortgagor;
(z) Acceptable Investment. There are no circumstances or
conditions with respect to the Mortgage, the Mortgaged Property, the
Mortgagor, the Mortgage File or the Mortgagor's credit standing that can
reasonably be expected to cause private institutional investors who
invest in prime mortgage loans similar to the Mortgage Loan to regard the
Mortgage Loan as an unacceptable investment, cause the Mortgage Loan to
become delinquent, or adversely affect the value or marketability of the
Mortgage Loan, or cause the Mortgage Loan to prepay during any period
materially faster or slower than the
-27-
mortgage loans originated by the Seller generally. No Mortgaged Property
is located in a state, city, county or other local jurisdiction which the
Purchaser has determined in its sole good faith discretion would cause
the related Mortgage Loan to be ineligible for whole loan sale or
securitization in a transaction consistent with the prevailing sale and
securitization industry (including, without limitation, the practice of
the rating agencies) with respect to substantially similar mortgage
loans;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the
Mortgage, the Assignment of Mortgage and any other documents required to
be delivered under this Agreement for each Mortgage Loan have been
delivered to the Custodian. The Seller is in possession of a complete,
true and accurate Mortgage File in compliance with Exhibit 2 attached
hereto, except for such documents the originals of which have been
delivered to the Custodian;
(bb) Transfer of Mortgage Loans. The Assignment of Mortgage
(except with respect to any Mortgage that has been recorded in the name
of MERS or its designee) with respect to each Mortgage Loan is in
recordable form and is acceptable for recording under the laws of the
jurisdiction in which the Mortgaged Property is located;
(cc) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan,
the Mortgage contains an enforceable provision for the acceleration of
the payment of the unpaid principal balance of the Mortgage Loan in the
event that the Mortgaged Property is sold or transferred without the
prior written consent of the Mortgagee thereunder;
(dd) Assumability. With respect to each Adjustable Rate Mortgage
Loan, the Mortgage Loan Documents provide that after the related first
Interest Rate Adjustment Date, a related Mortgage Loan may only be
assumed if the party assuming such Mortgage Loan meets certain credit
requirements stated in the Mortgage Loan Documents;
(ee) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to
which Monthly Payments are paid or partially paid with funds deposited in
any separate account established by the Seller, the Mortgagor, or anyone
on behalf of the Mortgagor, or paid by any source other than the
Mortgagor nor does it contain any other similar provisions which may
constitute a "buydown" provision. The Mortgage Loan is not a graduated
payment mortgage loan and the Mortgage Loan does not have a shared
appreciation or other contingent interest feature;
(ff) Consolidation of Future Advances. Any future advances made to
the Mortgagor prior to the applicable Cut-off Date have been consolidated
with the outstanding principal amount secured by the Mortgage, and the
secured principal amount, as consolidated, bears a single interest rate
and single repayment term. The lien of the Mortgage securing the
consolidated principal amount is expressly insured as having first (with
respect to a First Lien Loan) or second (with respect to a Second Lien
Loan) lien priority by a title insurance policy, an endorsement to the
policy insuring the Mortgagee's consolidated interest or by other title
evidence acceptable to ▇▇▇▇▇▇ Mae and ▇▇▇▇▇▇▇
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Mac. The consolidated principal amount does not exceed the original
principal amount of the Mortgage Loan;
(gg) Mortgaged Property Undamaged; No Condemnation Proceedings.
There is no proceeding pending or threatened for the total or partial
condemnation of the Mortgaged Property. The Mortgaged Property is
undamaged by waste, fire, earthquake or earth movement, windstorm, flood,
tornado or other casualty so as to affect adversely the value of the
Mortgaged Property as security for the Mortgage Loan or the use for which
the premises were intended and each Mortgaged Property is in good repair.
There have not been any condemnation proceedings with respect to the
Mortgaged Property;
(hh) Collection Practices; Escrow Deposits; Interest Rate
Adjustments. The origination, servicing and collection practices used by
the Seller with respect to the Mortgage Loan have been in all respects in
compliance with Accepted Servicing Practices, applicable laws and
regulations, and have been in all respects legal and proper. With respect
to escrow deposits and Escrow Payments, all such payments are in the
possession of, or under the control of, the Seller and there exist no
deficiencies in connection therewith for which customary arrangements for
repayment thereof have not been made. All Escrow Payments have been
collected in full compliance with state and federal law and the
provisions of the related Mortgage Note and Mortgage. An escrow of funds
is not prohibited by applicable law and has been established in an amount
sufficient to pay for every item that remains unpaid and has been
assessed but is not yet due and payable. No escrow deposits or Escrow
Payments or other charges or payments due the Seller have been
capitalized under the Mortgage or the Mortgage Note. All Mortgage
Interest Rate adjustments have been made in strict compliance with state
and federal law and the terms of the related Mortgage and Mortgage Note
on the related Interest Rate Adjustment Date. If, pursuant to the terms
of the Mortgage Note, another index was selected for determining the
Mortgage Interest Rate, the same index was used with respect to each
Mortgage Note which required a new index to be selected, and such
selection did not conflict with the terms of the related Mortgage Note.
The Seller executed and delivered any and all notices required under
applicable law and the terms of the related Mortgage Note and Mortgage
regarding the Mortgage Interest Rate and the Monthly Payment adjustments.
Any interest required to be paid pursuant to state, federal and local law
has been properly paid and credited;
(ii) Conversion to Fixed Interest Rate. The Mortgage Loan does not
contain a provision whereby the Mortgagor is permitted to convert the
Mortgage Interest Rate from an adjustable rate to a fixed rate;
(jj) Other Insurance Policies; No Defense to Coverage. No action,
inaction or event has occurred and no state of facts exists or has
existed on or prior to the Closing Date that has resulted or will result
in the exclusion from, denial of, or defense to coverage under any
applicable hazard insurance policy, PMI Policy or bankruptcy bond
(including, without limitation, any exclusions, denials or defenses which
would limit or reduce the availability of the timely payment of the full
amount of the loss otherwise due thereunder to the insured), irrespective
of the cause of such failure of coverage. The Seller has caused or will
cause to be performed any and all acts required to preserve the
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rights and remedies of the Purchaser in any insurance policies applicable
to the Mortgage Loans including, without limitation, any necessary
notifications of insurers, assignments of policies or interests therein,
and establishments of coinsured, joint loss payee and mortgagee rights in
favor of the Purchaser. In connection with the placement of any such
insurance, no commission, fee, or other compensation has been or will be
received by the Seller or by any officer, director, or employee of the
Seller or any designee of the Seller or any corporation in which the
Seller or any officer, director, or employee had a financial interest at
the time of placement of such insurance;
(kk) No Violation of Environmental Laws. To the best of the
Seller's knowledge, there is no pending action or proceeding directly
involving the Mortgaged Property in which compliance with any local,
state or federal environmental law, rule or regulation is an issue and
the Mortgaged Property is free from any and all toxic or hazardous
substances; there is no violation of any environmental law, rule or
regulation with respect to the Mortgage Property; and nothing further
remains to be done to satisfy in full all requirements of each such law,
rule or regulation constituting a prerequisite to use and enjoyment of
said property;
(ll) Servicemembers Civil Relief Act. The Mortgagor has not
notified the Seller, and the Seller has no knowledge of any relief
requested or allowed to the Mortgagor under the Servicemembers Civil
Relief Act or other similar state statute;
(mm) Appraisal. The Mortgage File contains an appraisal of the
related Mortgaged Property signed prior to the approval of the Mortgage
Loan application by a Qualified Appraiser, duly appointed by the Seller,
who had no interest, direct or indirect in the Mortgaged Property or in
any loan made on the security thereof, and whose compensation is not
affected by the approval or disapproval of the Mortgage Loan, and the
appraisal and appraiser both satisfy the requirements of ▇▇▇▇▇▇ ▇▇▇ or
▇▇▇▇▇▇▇ Mac and Title XI of FIRREA and the regulations promulgated
thereunder, all as in effect on the date the Mortgage Loan was
originated;
(nn) Disclosure Materials. The Mortgagor has executed a statement
to the effect that the Mortgagor has received all disclosure materials
required by, and the Seller has complied with, all applicable law with
respect to the making of the Mortgage Loans. The Seller shall maintain
such statement in the Mortgage File;
(oo) Construction or Rehabilitation of Mortgaged Property. No
Mortgage Loan was made in connection with the construction (other than a
"construct-to-perm" loan) or rehabilitation of a Mortgaged Property or
facilitating the trade-in or exchange of a Mortgaged Property;
(pp) Escrow Analysis. If applicable, with respect to each Mortgage
Loan, the Seller has within the last twelve months (unless such Mortgage
was originated within such twelve month period) analyzed the required
Escrow Payments for each Mortgage and adjusted the amount of such
payments so that, assuming all required payments are timely made, any
deficiency will be eliminated on or before the first anniversary of such
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analysis, or any overage will be refunded to the Mortgagor, in accordance
with RESPA and any other applicable law;
(qq) Credit Information. As to each consumer report (as defined in
the Fair Credit Reporting Act, Public Law 91-508) or other credit
information furnished by the Seller to the Purchaser, that Seller has
full right and authority and is not precluded by law or contract from
furnishing such information to the Purchaser and the Purchaser is not
precluded from furnishing the same to any subsequent or prospective
purchaser of such Mortgage. The Servicer has furnished, or has caused to
be fully furnished, and shall in its capacity as servicer, for each
Mortgage Loan, 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. This
representation and warranty is a Deemed Material and Adverse
Representation;
(rr) Leaseholds. If the Mortgage Loan is secured by a leasehold
estate, (1) the ground lease is assignable or transferable; (2) the
ground lease will not terminate earlier than five years after the
maturity date of the Mortgage Loan; (3) the ground lease does not provide
for termination of the lease in the event of lessee's default without the
Mortgagee being entitled to receive written notice of, and a reasonable
opportunity to cure the default; (4) the ground lease permits the
mortgaging of the related Mortgaged Property; (5) the ground lease
protects the Mortgagee's interests in the event of a property
condemnation; (6) all ground lease rents, other payments, or assessments
that have become due have been paid; and (7) the use of leasehold estates
for residential properties is a widely accepted practice in the
jurisdiction in which the Mortgaged Property is located;
(ss) Prepayment Penalty. Each Mortgage Loan that is subject to a
Prepayment Penalty as provided in the related Mortgage Note is identified
on the related Mortgage Loan Schedule. With respect to each Mortgage Loan
that has a Prepayment Penalty feature, each such Prepayment Penalty is
enforceable and will be enforced by the Servicer and each Prepayment
Penalty is permitted pursuant to federal, state and local law. Each such
Prepayment Penalty is in an amount not more than the maximum amount
permitted under applicable law and no such Prepayment Penalty may be
imposed for a term in excess of five (5) years with respect to Mortgage
Loans originated prior to October, 1, 2002. With respect to Mortgage
Loans originated on or after October 1, 2002, the duration of the
Prepayment Penalty period shall not exceed three (3) years from the date
of the Mortgage Note unless the Mortgage Loan was modified to reduce the
Prepayment Penalty period to no more than three (3) years from the date
of the related Mortgage Note and the Mortgagor was notified in writing of
such reduction in Prepayment Penalty period. With respect to any Mortgage
Loan that contains a provision permitting imposition of a premium upon a
prepayment prior to maturity: (i) prior to the Mortgage Loan's
origination, the Mortgagor agreed to such premium in exchange for a
monetary benefit, including but not limited to a rate or fee reduction,
(ii) prior to the Mortgage Loan's origination, the Mortgagor was offered
the option of obtaining a mortgage loan that did not require payment of
such a premium, and (iii) the Prepayment
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Penalty is disclosed to the Mortgagor in the mortgage loan documents
pursuant to applicable state, local and federal law. This representation
and warranty is a Deemed Material and Adverse Representation;
(tt) Predatory Lending Regulations. No Mortgage Loan is a High
Cost Loan or Covered Loan, as applicable. No Mortgage Loan is covered by
the Home Ownership and Equity Protection Act of 1994 and no Mortgage Loan
is in violation of any comparable state or local law. The Mortgaged
Property is not located in a jurisdiction where a breach of this
representation with respect to the related Mortgage Loan may result in
additional assignee liability to the Purchaser, as determined by
Purchaser in its reasonable discretion. This representation and warranty
is a Deemed Material and Adverse Representation;
(uu) Single-premium credit life insurance policy. No Mortgagor was
required to purchase any single premium credit insurance policy (e.g.,
life, disability, property, accident, unemployment or health insurance
product) or debt cancellation agreement as a condition of obtaining the
extension of credit. No Mortgagor obtained a prepaid single-premium
credit insurance policy (e.g., life, disability, property, accident,
unemployment, mortgage or health insurance) in connection with the
origination of the Mortgage Loan. No proceeds from any Mortgage Loan were
used to purchase single premium credit insurance policies or debt
cancellation agreements as part of the origination of, or as a condition
to closing, such Mortgage Loan. This representation and warranty is a
Deemed Material and Adverse Representation;
(vv) Qualified Mortgage. The Mortgage Loan is a qualified mortgage
under Section 860G(a)(3) of the Code;
(ww) Tax Service Contract. Each Mortgage Loan is either (x) a
First Lien Loan covered by a paid in full, life of loan, tax service
contract issued by First American Real Estate Tax Service, and such
contract is transferable, or (y) a Second Lien Loan subordinate to a
First Lien Loan which, to the best of Seller's knowledge, is covered by a
paid in full, life of loan, tax service contract issued by First American
Real Estate Tax Service, and such contract is transferable;
(xx) Origination. No predatory or deceptive lending practices,
including, without limitation, the extension of credit without regard to
the ability of the Mortgagor to repay and the extension of credit which
has no apparent benefit to the Mortgagor, were employed in the
origination of the Mortgage Loan;
(yy) Recordation. Each original Mortgage was recorded and all
subsequent assignments of the original Mortgage (other than the
assignment to the Purchaser) have been recorded in the appropriate
jurisdictions wherein such recordation is necessary to perfect the lien
thereof as against creditors of the Seller, or is in the process of being
recorded;
(zz) Co-op Loans. With respect to a Mortgage Loan that is a Co-op
Loan, the stock that is pledged as security for the Mortgage Loan is held
by a person as a
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tenant-stockholder (as defined in Section 216 of the Code) in a
cooperative housing corporation (as defined in Section 216 of the Code);
(aaa) Mortgagor Bankruptcy. The Mortgagor has not filed a
bankruptcy petition, is not the subject of an involuntary bankruptcy
proceeding and has not consented to the filing of a bankruptcy proceeding
against it or to a receiver being appointed in respect of the related
Mortgaged Property;
(bbb) No Prior Offer. The Mortgage Loan has not previously been
offered for sale;
(ccc) Georgia Fair Lending Act. There is no Mortgage Loan that was
originated (or modified) on or after October 1, 2002 and before March 7,
2003 which is secured by property located in the State of Georgia. There
is no Mortgage Loan that was originated on or after March 7, 2003 that is
a "high cost home loan" as defined under the Georgia Fair Lending Act.
This representation and warranty is a Deemed Material and Adverse
Representation;
(ddd) No Arbitration. No Mortgagor with respect to any Mortgage
Loan originated on or after August 1, 2004 agreed to submit to
arbitration to resolve any dispute arising out of or relating in any way
to the mortgage loan transaction. This representation and warranty is a
Deemed Material and Adverse Representation;
(eee) Flood Service Contract. Each Mortgage Loan is covered by a
paid in full, life of loan, flood service contract issued by First
American Real Estate Tax Service or Fidelity, and such contract is
transferable;
(fff) Negative Amortization. Unless otherwise disclosed in the
Mortgage Loan Schedule, no Mortgage Loan is subject to negative
amortization;
(ggg) Origination Practices/No Steering. No Mortgagor was
encouraged or required to select a mortgage loan product offered by the
Mortgage Loan's originator which is a higher cost product designed for
less creditworthy borrowers, unless at the time of the Mortgage Loan's
origination, such Mortgagor did not qualify taking into account credit
history and debt-to-income ratios for a lower-cost credit product then
offered by the Mortgage Loan's originator or any affiliate of the
Mortgage Loan's originator. If, at the time of loan application, the
Mortgagor may have qualified for a lower-cost credit product then offered
by any mortgage lending affiliate of the Mortgage Loan's originator, the
Mortgage Loan's originator referred the Mortgagor's application to such
affiliate for underwriting consideration. This representation and
warranty is a Deemed Material and Adverse Representation;
(hhh) Underwriting Methodology. The methodology used in
underwriting the extension of credit for each Mortgage Loan employs, in
part, objective mathematical principles which relate the Mortgagor's
income, assets and liabilities to the proposed payment and such
underwriting methodology does not rely on the extent of the Mortgagor's
equity in the collateral as the principal determining factor in approving
such credit extension. Such underwriting methodology confirmed that at
the time of
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origination (application/approval) the Mortgagor had a reasonable ability
to make timely payments on the Mortgage Loan. This representation and
warranty is a Deemed Material and Adverse Representation;
(iii) Points and Fees. No Mortgagor was charged "points and fees"
(whether or not financed) in an amount greater than (i) $1,000, or (ii)
5% of the principal amount of such Mortgage Loan, whichever is greater.
For purposes of this representation, such 5% limitation is calculated in
accordance with ▇▇▇▇▇▇ Mae's anti-predatory lending requirements as set
forth in the ▇▇▇▇▇▇ Mae Guides and "points and fees" (x) include
origination, underwriting, broker and finder fees and charges that the
mortgagee imposed as a condition of making the Mortgage Loan, whether
they are paid to the mortgagee or a third party; and (y) exclude bona
fide discount points, fees paid for actual services rendered in
connection with the origination of the Mortgage Loan (such as attorneys'
fees, notaries fees and fees paid for property appraisals, credit
reports, surveys, title examinations and extracts, flood and tax
certifications, and home inspections), the cost of mortgage insurance or
credit-risk price adjustments, the costs of title, hazard, and flood
insurance policies, state and local transfer taxes or fees, escrow
deposits for the future payment of taxes and insurance premiums, and
other miscellaneous fees and charges that, in total, do not exceed 0.25%
of the principal amount of such Mortgage Loan. This representation and
warranty is a Deemed Material and Adverse Representation;
(jjj) Fees Charges. All points, fees and charges (including
finance charges) and whether or not financed, assessed, collected or to
be collected in connection with the origination and servicing of each
Mortgage Loan have been disclosed in writing to the Mortgagor in
accordance with applicable state and federal law and regulation. This
representation and warranty is a Deemed Material and Adverse
Representation; and
(kkk) Second Lien Loans. With respect to each Second Lien Loan:
(i) No Negative Amortization of Related First Lien Loan. The
related first lien loan does not permit negative amortization;
(ii) Request for Notice; No Consent Required. Where required or
customary in the jurisdiction in which the Mortgaged Property is
located, the original lender has filed for record a request for
notice of any action by the related senior lienholder, and the
Seller has notified such senior lienholder in writing of the
existence of the Second Lien Loan and requested notification of any
action to be taken against the Mortgagor by such senior lienholder.
Either (a) no consent for the Second Lien Loan is required by the
holder of the related first lien loan or (b) such consent has been
obtained and is contained in the related Mortgage File;
(iii) No Default Under First Lien. To the best of Seller's
knowledge, the related first lien loan is in full force and effect,
and there is no default lien, breach, violation or event which would
permit acceleration existing under such first lien mortgage or
mortgage note, and no event which, with the passage of time or with
notice and the expiration of any grace or cure period, would
constitute a
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default, breach, violation or event which would permit acceleration
under such first lien loan;
(iv) Right to Cure First Lien. The related first lien mortgage
contains a provision which provides for giving notice of default or
breach to the mortgagee under the Mortgage Loan and allows such
mortgagee to cure any default under the related first lien mortgage;
and
(v) Principal Residence. The related Mortgaged Property was the
Mortgagor's principal residence at the time of the origination of
such Second Lien Loan. This representation and warranty is a Deemed
Material and Adverse Representation.
Subsection 7.02 Seller and Servicer Representations. Each of the
Seller and the Servicer, to the extent set forth in this Section 7.02 hereby
represent and warrant to the Purchaser that, as of the related Closing Date:
(a) Due Organization and Authority. The Seller and Servicer are
each a corporation duly organized, validly existing, and in good standing
under the laws of their jurisdiction of incorporation or formation and
has all licenses necessary to carry on their business as now being
conducted, except where the failure to be so licensed would not have a
material adverse effect on the Seller or the Servicer, (as the case may
be), the Mortgage Loans, the Mortgaged Properties or the transactions
contemplated by this Agreement, and is licensed, qualified and in good
standing in the states where the Mortgaged Property is located if the
laws of such state require licensing or qualification in order to conduct
business of the type conducted by the Seller or the Servicer, and in any
event each of the Seller and the Servicer is in compliance with the laws
of any such state to the extent necessary to ensure the enforceability of
the related Mortgage Loan. The Seller and the Servicer had the full
corporate power and authority and legal right to originate the Mortgage
Loans that it originated and to acquire the Mortgage Loans that it
acquired. The Seller and the Servicer has corporate power and authority
to hold each Mortgage Loan, and to execute and deliver this Agreement and
to perform its obligations hereunder; the execution, delivery and
performance of this Agreement (including all instruments of transfer to
be delivered pursuant to this Agreement) by the Seller and the Servicer
and the consummation of the transactions contemplated hereby have been
duly and validly authorized; this Agreement has been duly executed and
delivered and constitutes the valid, legal, binding and enforceable
obligation of the Seller and the Servicer, except as enforceability may
be limited by (i) bankruptcy, insolvency, liquidation, receivership,
moratorium, reorganization or other similar laws affecting the
enforcement of the rights of creditors and (ii) general principles of
equity, whether enforcement is sought in a proceeding in equity or at
law. All requisite corporate action has been taken by the Seller and the
Servicer to make this Agreement valid and binding upon the Seller and the
Servicer in accordance with its terms;
(b) No Consent Required. No consent, approval, authorization or
order is required for the transactions contemplated by this Agreement
from any court, governmental agency or body, or federal or state
regulatory authority having jurisdiction
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over the Seller or the Servicer is required or, if required, such
consent, approval, authorization or order has been or will, prior to the
related Closing Date, be obtained;
(c) Ordinary Course of Business. The consummation of the
transactions contemplated by this Agreement are in the ordinary course of
business of the Seller or the Servicer, and the transfer, assignment and
conveyance of the Mortgage Notes and the Mortgages by the Seller pursuant
to this Agreement are not subject to the bulk transfer or any similar
statutory provisions in effect in any applicable jurisdiction;
(d) No Conflicts. Neither the execution and delivery of this
Agreement by the Seller and the Servicer, the acquisition or origination
of the Mortgage Loans by the Seller, the sale of the Mortgage Loans to
the Purchaser, the consummation of the transactions contemplated hereby,
nor the fulfillment of or compliance with the terms and conditions of
this Agreement, will conflict with or result in a breach of any of the
terms, conditions or provisions of (i) the Seller's or the Servicer's
charter or by-laws or (ii) any legal restriction or any agreement or
instrument to which the Seller or 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 except, in the case of clause (ii), any defaults or
breaches that would not, either in any one instance or in the aggregate,
result in a material adverse effect on the Seller or the Servicer, the
Mortgage Loans, the Mortgaged Properties or the transactions contemplated
by this Agreement, or result in the material violation of any law, rule,
regulation, order, judgment or decree to which the Seller or the Servicer
or its property is subject, or result in the creation or imposition of
any lien, charge or encumbrance that would have a material adverse effect
upon any of its properties pursuant to the terms of any mortgage,
contract, deed of trust or other instrument, or impair the ability of the
Purchaser to realize on the Mortgage Loans, impair the value of the
Mortgage Loans, or impair the ability of the Purchaser to realize the
full amount of any insurance benefits accruing pursuant to this
Agreement;
(e) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or threatened against the Seller or the Servicer,
before any court, administrative agency or other tribunal asserting the
invalidity of this Agreement, seeking to prevent the consummation of any
of the transactions contemplated by this Agreement or which, either in
any one instance or in the aggregate, may result in any material adverse
change in the business, operations, financial condition, properties or
assets of the Seller, or in any material impairment of the right or
ability of the Seller or the Servicer to carry on its business
substantially as now conducted, or in any material liability on the part
of the Seller or the Servicer, or which would draw into question the
validity of this Agreement or the Mortgage Loans or of any action taken
or to be taken in connection with the obligations of the Seller or the
Servicer contemplated herein, or which would be likely to impair
materially the ability of the Seller or the Servicer to perform under the
terms of this Agreement;
(f) Ability to Perform; Solvency. Neither the Seller nor the
Servicer believes, nor does it have any reason or cause to believe, that
it cannot perform each and every covenant contained in this Agreement.
The Seller and the Servicer are solvent and the sale of the Mortgage
Loans will not cause the Seller to become insolvent. The sale of the
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Mortgage Loans is not undertaken with the intent to hinder, delay or
defraud any of Seller's or Servicer's creditors;
(g) Seller's Origination. The Seller's decision to originate any
mortgage loan or to deny any mortgage loan application is an independent
decision based upon the Underwriting Guidelines, and is in no way made as
a result of Purchaser's decision to purchase, or not to purchase, or the
price Purchaser may offer to pay for, any such mortgage loan, if
originated;
(h) Anti-Money Laundering Laws. The Seller and the Servicer have
complied with all applicable anti-money laundering laws, executive orders
and regulations, including without limitation the USA Patriot Act of 2001
(collectively, the "Anti-Money Laundering Laws"); the Seller and the
Servicer have established an anti-money laundering compliance program as
required by the Anti-Money Laundering Laws, has conducted the requisite
due diligence in connection with the origination of each Mortgage Loan
for purposes of the Anti-Money Laundering Laws, including with respect to
the legitimacy of the applicable Mortgagor and the origin of the assets
used by the said Mortgagor to purchase the property in question, and
maintains, and will maintain, sufficient information to identify the
applicable Mortgagor for purposes of the Anti-Money Laundering Laws
(i) Financial Statements; Other Information. The Seller and the
Servicer have delivered to the Purchaser financial statements as to its
last three complete fiscal years and any later quarter ended more than 60
days prior to the execution of this Agreement. All such financial
statements (a) fairly present the pertinent results of operations and
changes in financial position for each of such periods and the financial
position at the end of each such period of the Seller and its
subsidiaries and the Servicer and its subsidiaries and (b) are true,
correct and complete as of their respective dates and have been prepared
in accordance with generally accepted accounting principles consistently
applied throughout the periods involved, except as set forth in the notes
thereto. In addition, the Seller and the Servicer have delivered
information as to their loan gain and loss experience in respect of
foreclosures and its loan delinquency experience for the immediately
preceding three year period, in each case with respect to mortgage loans
owned by it and such mortgage loans serviced for others during such
period, and all such information so delivered shall be true and correct
in all material respects. There has been no change in the business,
operations, financial condition, properties or assets of the Seller or
the Servicer since the date of the Seller's or Servicer's financial
Statements that would have a material adverse effect on its ability to
perform its obligations under this Agreement;
(j) Ability to Service. The Servicer has 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
duly qualified, licensed, registered and otherwise authorized under all
applicable federal, state and local laws, and regulations, if applicable,
meets the minimum capital requirements set forth by HUD, the OTS, the OCC
or the FDIC, if applicable, and is in good standing to enforce,
originate, sell
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mortgage loans to, and service mortgage loans in the jurisdiction wherein
the Mortgaged Properties are located;
(k) Reasonable Servicing Fee. The Servicer acknowledges and agrees
that the Servicing Fee represents reasonable compensation for performing
such services and that the entire Servicing Fee shall be treated by the
Servicer, for accounting and tax purposes, as compensation for the
servicing and administration of the Mortgage Loans pursuant to this
Agreement;
(l) Selection Process. The Mortgage Loans were selected from among
the outstanding one- to four-family mortgage loans in the Seller's
portfolio at the related Closing Date as to which the representations and
warranties set forth in Subsection 7.01 could be made and such selection
was not made in a manner so as to affect adversely the interests of the
Purchaser;
(m) Delivery to the Custodian. The Mortgage Note, the Mortgage,
the Assignment of Mortgage and any other documents required to be
delivered with respect to each Mortgage Loan pursuant to the Custodial
Agreement, shall be delivered to the Custodian all in compliance with the
specific requirements of the Custodial Agreement. With respect to each
Mortgage Loan, the Servicer will be in possession of a complete Mortgage
File in compliance with Exhibit 2 hereto, except for such documents as
will be delivered to the Custodian;
(n) Mortgage Loan Characteristics. The characteristics of the
related Mortgage Loan Package are as set forth on the description of the
pool characteristics for the applicable Mortgage Loan Package delivered
pursuant to Section 9 on the related Closing Date in the form attached as
Exhibit B to each related Assignment and Conveyance Agreement;
(o) No Untrue Information. Neither this Agreement nor any
information, statement, tape, diskette, report, form, or other document
furnished or to be furnished pursuant to this Agreement or any
Reconstitution Agreement or in connection with the transactions
contemplated hereby (including any Securitization Transaction or Whole
Loan Transfer) contains or will contain any untrue statement of fact or
omits or will omit to state a fact necessary to make the statements
contained herein or therein not misleading in any material respect;
(p) No Brokers. Neither the Seller nor the Servicer have dealt
with any broker, investment banker, agent or other person that may be
entitled to any commission or compensation in connection with the sale of
the Mortgage Loans;
(q) Sale Treatment. The Seller expects to be advised by its
independent certified public accountants that under generally accepted
accounting principles the transfer of the Mortgage Loans will be treated
as a sale on the books and records of the Seller and the Seller has
determined that the disposition of the Mortgage Loans pursuant to this
Agreement will be afforded sale treatment for tax and accounting
purposes;
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(r) Reasonable Purchase Price. The consideration received by the
Seller upon the sale of the Mortgage Loans under this Agreement
constitutes fair consideration and reasonably equivalent value for the
Mortgage Loans;
(s) Owner of Record. The Seller is the owner of record of each
Mortgage and the indebtedness evidenced by each Mortgage Note, except for
any Assignments of Mortgage which have been sent for recording, and upon
recordation the Seller will be the owner of record of each Mortgage and
the indebtedness evidenced by each Mortgage Note, and upon the sale of
the Mortgage Loans to the Purchaser, the Seller will retain the Mortgage
Files with respect thereto in trust only for the purpose of servicing and
supervising the servicing of each Mortgage Loan; and
(t) Privacy. Each of the Seller and the Servicer agree and
acknowledge that as to all nonpublic personal information received or
obtained by it with respect to any Mortgagor: (a) such information is and
shall be held by Seller and Servicer in accordance with all applicable
law, including but not limited to the privacy provisions of the
▇▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇ Act; (b) to the extent such information is included in
the Mortgage Loan Schedule, such information is in connection with a
proposed or actual secondary market sale related to a transaction of the
Mortgagor for purposes of 16 C.F.R. ss.313.14(a)(3); and (c) Seller and
the Servicer are hereby prohibited from disclosing or using any such
information other than to carry out the express provisions of this
Agreement, or as otherwise permitted by applicable law.
Subsection 7.03 Remedies for Breach of Representations and
Warranties. It is understood and agreed that the representations and
warranties set forth in Subsections 7.01 and 7.02 shall survive the sale of
the Mortgage Loans to the Purchaser and shall inure to the benefit of the
Purchaser, notwithstanding any restrictive or qualified endorsement on any
Mortgage Note or Assignment of Mortgage or the examination or failure to
examine any Mortgage File. Upon discovery by either the Seller, the Servicer
or the Purchaser of a breach of any of the foregoing representations and
warranties, the party discovering such breach shall give prompt written notice
to the other relevant parties.
Within sixty (60) days after the earlier of either discovery by or
notice to the Seller of any such breach of a representation or warranty, which
materially and adversely affects the value of the Mortgage Loans or the
interest of the Purchaser therein (or which materially and adversely affects
the value of the applicable Mortgage Loan or the interest of the Purchaser
therein in the case of a representation and warranty relating to a particular
Mortgage Loan), the Seller shall use its best efforts promptly to cure such
breach in all material respects and, if such breach cannot be cured by the
Seller by the earlier of sixty (60) days from (i) the Seller's discovery of
such breach or (ii) the Seller's actual receipt of notice of such breach, the
Seller shall, at the Purchaser's option, repurchase such affected Mortgage
Loan at the Repurchase Price. Notwithstanding the above sentence, (i) within
sixty (60) days after the earlier of either discovery by, or notice to, the
Seller of any breach of the representation and warranty set forth in clause
(vv) of Subsection 7.01, the Seller shall repurchase such Mortgage Loan at the
Repurchase Price and (ii) any breach of a Deemed Material and Adverse
Representation shall automatically be deemed to materially and adversely
affects the value of the Mortgage Loans or the interest of the Purchaser
therein. In the event that a breach shall involve any representation
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or warranty set forth in Subsection 7.02, and such breach cannot be cured
within 60 days of the earlier of either discovery by or notice to the Seller
of such breach, all of the Mortgage Loans materially and adversely affected by
such breach shall, at the Purchaser's option, be repurchased by the Seller at
the Repurchase Price. However, if the breach, shall involve a representation
or warranty set forth in Subsection 7.01 (except as provided in the second
sentence of this paragraph with respect to certain breaches for which no
substitution is permitted) and the Seller discovers or receives notice of any
such breach within 120 days of the related Closing Date, the Seller shall, at
the Purchaser's option and provided that the Seller has a Qualified Substitute
Mortgage Loan, rather than repurchase the Mortgage Loan as provided above,
remove such Mortgage Loan and substitute in its place a Qualified Substitute
Mortgage Loan; provided, however, that any such substitution shall be effected
not later than one hundred twenty (120) days after the related Closing Date.
If the Seller has no Qualified Substitute Mortgage Loan, it shall repurchase
the deficient Mortgage Loan at the Repurchase Price. Any repurchase of a
Mortgage Loan pursuant to the foregoing provisions of this Subsection 7.03
shall occur on a date designated by the Purchaser, and acceptable to the
Seller, and shall be accomplished by the Seller remitting to the Servicer for
deposit the amount of the Repurchase Price in the Custodial Account for
distribution to the Purchaser on the next scheduled Remittance Date.
At the time of repurchase of any deficient Mortgage Loan (or
removal of any Deleted Mortgage Loan), the Purchaser and the Seller shall
arrange for the assignment of the repurchased Mortgage Loan (or Deleted
Mortgage Loan) to the Seller or its designee and the delivery to the Seller of
any documents held by the Purchaser relating to the repurchased Mortgage Loan
in the manner required by this Agreement with respect to the purchase and sale
of such Mortgage Loan on the related Closing Date. In the event the Repurchase
Price is deposited in the Custodial Account, the Seller shall, simultaneously
with its remittance to the Servicer of such Repurchase Price for deposit, give
written notice to the Purchaser that such deposit has taken place. Upon such
repurchase, the Seller shall amend the related Mortgage Loan Schedule to
reflect the withdrawal of the repurchased Mortgage Loan from this Agreement.
As to any Deleted Mortgage Loan for which the Seller substitutes
one or more Qualified Substitute Mortgage Loans, the Seller shall be deemed to
have made the representations and warranties set forth in this Agreement
except that all such representations and warranties set forth in this
Agreement shall be deemed made as of the date of such substitution. No
substitution will be made in any calendar month after the Determination Date
for such month. The Seller shall effect such substitution by delivering to the
Purchaser for each Qualified Substitute Mortgage Loan the Mortgage Note, the
Mortgage, the Assignment of Mortgage and such other documents and agreements
as are required by Subsection 6.03. The Seller shall remit to the Servicer for
deposit in the Custodial Account the Monthly Payment less the Servicing Fee
due on each Qualified Substitute Mortgage Loan in the month following the date
of such substitution. Monthly Payments due with respect to Qualified
Substitute Mortgage Loans in the month of substitution shall be retained by
the Seller. For the month of substitution, distributions to the Purchaser
shall include the Monthly Payment due on any Deleted Mortgage Loan in the
month of substitution, and the Seller shall thereafter be entitled to retain
all amounts subsequently received by the Seller in respect of such Deleted
Mortgage Loan. The Seller shall give written notice to the Purchaser that such
substitution has taken place and shall amend the related Mortgage Loan
Schedule to reflect the removal of such Deleted Mortgage Loan from the terms
of this Agreement and the substitution of the Qualified Substitute Mortgage
Loan. Upon
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such substitution, each Qualified Substitute Mortgage Loan shall be subject to
the terms of this Agreement in all respects, and the Seller shall be deemed to
have made with respect to such Qualified Substitute Mortgage Loan, as of the
date of substitution, the covenants, representations and warranties set forth
in Subsections 7.01 and 7.02.
For any month in which the Seller substitutes one or more
Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans,
the Seller shall determine the amount (if any) by which the aggregate
principal balance of all such Qualified Substitute Mortgage Loans as of the
date of substitution is less than the aggregate Stated Principal Balance of
all such Deleted Mortgage Loans (after application of scheduled principal
payments due in the month of substitution). The amount of such shortfall plus
one month's interest thereon at the applicable Mortgage Interest Rate minus
the related Servicing Fee shall be remitted to the Servicer by the Seller from
its own funds for distribution by the Servicer in the month of substitution
pursuant to Subsection 11.04. Accordingly, on the date of such substitution,
the Seller will remit to the Servicer from its own funds for deposit into the
Custodial Account an amount equal to the amount of such shortfall plus one
month's interest thereon at the Mortgage Loan Remittance Rate.
In addition to such repurchase or substitution obligation, the
Seller shall indemnify the Purchaser and its present and former directors,
officers, employees and agents and any Successor Servicer and its present and
former directors, officers, employees and agents and hold such parties
harmless against any losses, damages, penalties, fines, forfeitures, legal
fees and expenses and related costs, judgments, and other costs and expenses
resulting from any claim, demand, defense or assertion based on or grounded
upon, or resulting from, a breach of the Seller representations and warranties
contained in this Agreement or any Reconstitution Agreement. For purposes of
this paragraph, "Purchaser" shall mean the Person then acting as the Purchaser
under this Agreement and any and all Persons who previously were "Purchasers"
under this Agreement and "Successor Servicer" shall mean any Person designated
as the Successor Servicer pursuant to this Agreement and any and all Persons
who previously were "Successor Servicers" pursuant to this Agreement. It is
understood and agreed that the obligations of the Seller set forth in this
Subsection 7.03 to cure, repurchase or substitute for a defective Mortgage
Loan, and to indemnify the Purchaser and Successor Servicer under Subsection
12.01 constitute the sole remedies of the Purchaser and Successor Servicer
respecting a breach of the representations and warranties set forth in
Subsections 7.01 and 7.02.
Any cause of action against the Seller relating to or arising out
of the breach of any representations and warranties made in Subsections 7.01
and 7.02 shall accrue as to any Mortgage Loan upon (i) the earlier of
discovery of such breach by the Seller or notice thereof by the Purchaser to
the Seller, (ii) failure by the Seller to cure such breach, substitute a
Qualified Substitute Mortgage Loan, or repurchase such Mortgage Loan as
specified above and (iii) demand upon the Seller by the Purchaser for
compliance with this Agreement.
Subsection 7.04 Repurchase of Mortgage Loans with Early Payment
Defaults. If the related Mortgagor is delinquent with respect to any of the
Mortgage Loan's first three (3) Monthly Payments at any time either (i) after
origination of such Mortgage Loan, or (ii) after the related Closing Date, the
Seller, at the Purchaser's option, shall repurchase such
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Mortgage Loan from the Purchaser at a price equal to the Repurchase Price. The
Seller shall repurchase such delinquent Mortgage Loan within thirty (30) days
of such request.
Subsection 7.05 Premium Recapture. With respect to any Mortgage
Loan without Prepayment Penalties that prepays in full during the first three
months following the related Closing Date, and with respect to any Mortgage
Loan that is repurchased pursuant to Subsection 7.04, the Seller shall pay the
Purchaser, within three (3) Business Days after such prepayment in full or
repurchase, an amount equal to the excess of the Purchase Price Percentage for
such Mortgage Loan over par, multiplied by the outstanding principal balance
of such Mortgage Loan as of the related Cut-off Date.
Section 8. Closing. The closing for the purchase and sale of each
Mortgage Loan Package shall take place on the related Closing Date. At the
Purchaser's option, each closing shall be either: by telephone, confirmed by
letter or wire as the parties shall agree, or conducted in person, at such
place as the parties shall agree. Each closing shall be subject to each of the
following conditions:
(a) at least two Business Days prior to the related Closing Date,
the Seller shall deliver to the Purchaser a magnetic diskette, or
transmit by modem, a listing on a loan-level basis of the necessary
information to compute the Purchase Price of the Mortgage Loans delivered
on such Closing Date (including accrued interest), and prepare a Mortgage
Loan Schedule;
(b) all of the representations and warranties of the Seller in
this Agreement shall be true and correct as of the related Closing Date
and no event shall have occurred which, with notice or the passage of
time, would constitute an Event of Default under this Agreement;
(c) the Purchaser's attorneys shall have received or the
Purchaser's attorneys shall have received in escrow, all Closing
Documents as specified in Section 9, in such forms as are agreed upon and
acceptable to the Purchaser, duly executed by all signatories as required
pursuant to the terms hereof; and
(d) all other terms and conditions of this Agreement shall have
been complied with.
Section 9. Closing Documents. On the related Closing Date, the
Seller shall deliver to the Purchaser's attorneys in escrow fully executed
originals of:
(a) this Agreement (to be executed and delivered only for the
initial Closing Date);
(b) the related Purchase Price and Terms Agreement, executed in
four (4) counterparts;
(c) with respect to the initial Closing Date, the Custodial
Agreement, dated as of the initial Cut-off Date;
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(d) with respect to the initial Closing Date, a Custodial Account
Certification in the form attached as Exhibit 4 hereto or a Custodial
Account Letter Agreement in the form attached as Exhibit 5 hereto;
(e) with respect to the initial Closing Date, an Escrow Account
Certification in the form attached as Exhibit 6 hereto or an Escrow
Account Letter Agreement in the form attached as Exhibit 7 hereto;
(f) the related Mortgage Loan Schedule, segregated by Mortgage
Loan Package, one copy to be attached hereto, one copy to be attached to
the Custodian's counterpart of the Custodial Agreement, and one copy to
be attached to the related Assignment and Conveyance as the Mortgage Loan
Schedule thereto;
(g) with respect to the initial Closing Date, an Officer's
Certificate, in the form of Exhibit 10 hereto with respect to the Seller,
including all attachments thereto and with respect to subsequent Closing
Dates, an Officer's Certificate upon request of the Purchaser; and
(h) with respect to the initial Closing Date, an Opinion of
Counsel of the Seller (who may be an employee of the Seller), in the form
of Exhibit 11 hereto;
(i) a Security Release Certification, in the form of Exhibit 12 or
Exhibit 13, as applicable, hereto executed by any person, as requested by
the Purchaser, if any of the Mortgage Loans have at any time been subject
to any security interest, pledge or hypothecation for the benefit of such
person;
(j) a certificate or other evidence of merger or change of name,
signed or stamped by the applicable regulatory authority, if any of the
Mortgage Loans were acquired by the Seller by merger or acquired or
originated by the Seller while conducting business under a name other
than its present name, if applicable;
(k) with respect to the initial Closing Date, the Underwriting
Guidelines to be attached hereto as Exhibit 8 and with respect to each
subsequent Closing Date, the Underwriting Guidelines to be attached to
the related Assignment and Conveyance;
(l) Assignment and Conveyance Agreement in the form of Exhibit 14
hereto, including all exhibits thereto;
(m) a Custodian's Certification, as required under the Custodial
Agreement, in the form of Exhibit 2 to the Custodial Agreement; and
(n) a MERS Report reflecting the Purchaser as Investor, the
Custodian as custodian and no Person as Interim Funder for each MERS
Designated Mortgage Loan.
The Seller shall bear the risk of loss of the closing documents
until such time as they are received by the Purchaser or its attorneys.
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Section 10. Costs. The Purchaser shall pay any commissions due its
salesmen and the legal fees and expenses of its attorneys and custodial fees.
All other costs and expenses incurred in connection with the transfer and
delivery of the Mortgage including recording fees, fees for title policy
endorsements and continuations, fees for recording Assignments of Mortgage,
and the Seller's attorney's fees, shall be paid by the Seller.
Section 11. Administration and Servicing of the Mortgage Loans.
Subsection 11.01 Servicer to Act as Servicer. The Servicer shall
service and administer the Mortgage Loans in accordance with this Agreement
and Accepted Servicing Procedures and the terms of the Mortgage Notes and
Mortgages, and shall have full power and authority, acting alone or through
sub-servicers or agents, to do or cause to be done any and all things in
connection with such servicing and administration which the Servicer may deem
necessary or desirable and consistent with the terms of this Agreement. The
Servicer may perform its servicing responsibilities through agents or
independent contractors, but shall not thereby be released from any of its
responsibilities hereunder.
Consistent with the terms of this Agreement, the Servicer may
waive, modify or vary any term of any Mortgage Loan or consent to the
postponement of strict compliance with any such term or in any manner grant
indulgence to any Mortgagor; provided, however, that (unless the Mortgagor is
in default with respect to the Mortgage Loan, or such default is, in the
judgment of the Servicer, imminent, and the Servicer has the consent of the
Purchaser) the Servicer shall not permit any modification with respect to any
Mortgage Loan which materially and adversely affects the Mortgage Loan,
including without limitation, any modification that would defer or forgive the
payment of any principal or interest, capitalize any past due amounts owed
under the Mortgage Loan by adding amounts in arrearage to the existing Stated
Principal Balance of the Mortgage Loan (but only if the CLTV of such Mortgage
Loan prior to such capitalization equals or exceeds 80%, change the
outstanding principal amount (except for actual payments of principal), make
any future advances, extend the final maturity date or change the Mortgage
Interest Rate, as the case may be, with respect to such Mortgage Loan, or any
combination of the foregoing. Notwithstanding the foregoing, the Servicer
shall not waive any Prepayment Penalty or portion thereof unless (i) the
enforceability thereof shall have been limited by bankruptcy, insolvency,
moratorium, receivership or other similar laws relating to creditors' rights
generally or is otherwise prohibited by law, or (ii) the enforceability
thereof shall have been permanently limited due to acceleration in connection
with a foreclosure or other involuntary payment or (iii) in the Servicer's
reasonable judgment, (x) such waiver relates to a default or a reasonably
foreseeable default, (y) such waiver would maximize recovery of total proceeds
taking into account the value of such Prepayment Penalty and related Mortgage
Loan and (z) doing so is standard and customary in servicing Mortgage Loans
(including any waiver of a Prepayment Penalty in connection with a refinancing
of a Mortgage Loan that is related to a default or reasonably foreseeable
default). Except as provided in the preceding sentence, in no event will the
Servicer waive a Prepayment Penalty in connection with a refinancing of a
Mortgage Loan that is not related to a default or a reasonably foreseeable
default. If the Servicer waives or does not collect all or a portion of a
Prepayment Penalty relating to a Principal Prepayment in full or in part due
to any action or omission of the Servicer, other than as permitted above, the
Servicer shall deposit from its own funds without any right of
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reimbursement therefor the amount of such Prepayment Penalty (or such portion
thereof as had been waived for deposit) into the Custodial Account for
distribution in accordance with the terms of this Agreement. In connection
with any waiver of a Prepayment Penalty by the Servicer, the Servicer shall
account for such waiver in its monthly reports as agreed upon by the Servicer
and the Purchaser. Without limiting the generality of the foregoing, the
Servicer in its own name or acting through sub-servicers or agents is hereby
authorized and empowered by the Purchaser when the Servicer believes it
appropriate and reasonable in its best judgment, to execute and deliver, on
behalf of itself and the Purchaser, all instruments of satisfaction or
cancellation, or of partial or full release, discharge and all other
comparable instruments, with respect to the Mortgage Loans and the Mortgaged
Properties and to institute foreclosure proceedings or obtain a deed-in-lieu
of foreclosure so as to convert the ownership of such properties, and to hold
or cause to be held title to such properties, on behalf of the Purchaser
pursuant to the provisions of Subsection 11.12. The Servicer shall make all
required Servicing Advances and shall service and administer the Mortgage
Loans in accordance with applicable state and federal law and shall provide to
the Mortgagors any reports required to be provided to them thereby. The
Purchaser shall furnish to the Servicer any powers of attorney and other
documents reasonably necessary or appropriate to enable the Servicer to carry
out its servicing and administrative duties under this Agreement.
Notwithstanding anything to the contrary in this Agreement, the
Purchaser may at any time and from time to time, in its sole discretion, upon
written notice to the Seller, with respect to (1) any REO Property or (2) all
Mortgage Loans that are 90 or more days delinquent as of the date of such
notice and any Mortgage Loans that subsequently become 90 or more days
delinquent following the date of such notice (for the purposes of this
paragraph such Mortgage Loans, "Delinquent Mortgage Loans"), either (i)
terminate the Seller's servicing obligations hereunder with respect to such
REO Properties and Delinquent Mortgage Loans, upon reimbursement of any
unreimbursed advances owed to the Servicer and payment of the termination fee
referred to in Subsection 14.02, or (ii) assume the absolute right to direct
the Seller to take such actions with respect to such REO Property and
Delinquent Mortgage Loans as the Seller would otherwise be able to undertake
pursuant to Subsection 11.12. Upon the effectiveness of any such termination
of the Seller's servicing obligations with respect to any such REO Property or
Delinquent Mortgage Loan, the Seller shall deliver all agreements, documents,
and instruments related thereto to the Purchaser, in accordance with Accepted
Servicing Procedures and applicable law and shall transfer servicing to the
Purchaser's designee in accordance with Acceptable Servicing Procedures.
Subsection 11.02 Liquidation of Mortgage Loans. If any payment due
under any Mortgage Loan is not paid when the same becomes due and payable, or
in the event the Mortgagor fails to perform any other covenant or obligation
under the Mortgage Loan and such failure continues beyond any applicable grace
period, the Servicer shall take such action as it shall deem to be in the best
interest of the Purchaser. If any payment due under any Mortgage Loan remains
delinquent for a period of one hundred twenty (120) days or more, the Servicer
shall commence foreclosure proceedings in accordance with the guidelines set
forth by ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac. In such event, the Servicer shall from its
own funds make all necessary and proper Servicing Advances.
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Subsection 11.03 Collection of Mortgage Loan Payments.
Continuously from the date hereof until the principal and interest on all
Mortgage Loans are paid in full, the Servicer will proceed diligently, in
accordance with this Agreement, to collect all payments due under each of the
Mortgage Loans when the same shall become due and payable. Further, the
Servicer will in accordance with Accepted Servicing Procedures ascertain and
estimate taxes, assessments, fire and hazard insurance premiums, and all other
charges that, as provided in any Mortgage, will become due and payable 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.
Subsection 11.04 Establishment of Custodial Account; Deposits in
Custodial Account. The Servicer shall segregate and hold all funds collected
and received pursuant to each Mortgage Loan separate and apart from any of its
own funds and general assets and shall establish and maintain one or more
Custodial Accounts (collectively, the "Custodial Account"), titled "American
Home Mortgage Servicing, Inc., in trust for ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital
Inc. as Purchaser of Mortgage Loans and various Mortgagors." Such Custodial
Account shall be established with a commercial bank, a savings bank or a
savings and loan association (which may be a depository affiliate of the
Servicer) which meets the guidelines set forth by ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac as
an eligible depository institution for custodial accounts. In any case, the
Custodial Account shall be insured by the FDIC in a manner which shall provide
maximum available insurance thereunder and which may be drawn on by the
Servicer. The creation of any Custodial Account shall be evidenced by (i) a
certification in the form of Exhibit 4 hereto, in the case of an account
established with a depository affiliate of the Servicer, or (ii) a letter
agreement in the form of Exhibit 5 hereto, in the case of an account held by a
depository other than an affiliate of the Servicer. In either case, a copy of
such certification or letter agreement shall be furnished to the Purchaser
upon request.
The Servicer shall deposit in the Custodial Account within
forty-eight (48) hours following receipt thereof, and retain therein the
following payments and collections received or made by it subsequent to the
related Cut-off Date (other than in respect of principal and interest on the
Mortgage Loans due on or before the related Cut-off Date):
(a) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
(b) all payments on account of interest on the Mortgage Loans
adjusted to the Mortgage Loan Remittance Rate;
(c) all Liquidation Proceeds;
(d) all proceeds received by the Servicer under any title
insurance policy, hazard insurance policy, or other insurance policy
other than proceeds to be held in the Escrow Account and applied to the
restoration or repair of the Mortgaged Property or released to the
Mortgagor in accordance with Accepted Servicing Procedures;
(e) all awards or settlements in respect of condemnation
proceedings or eminent domain affecting any Mortgaged Property which are
not released to the Mortgagor in accordance with Accepted Servicing
Procedures;
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(f) any amount required to be deposited in the Custodial Account
pursuant to Subsections 11.14, 11.16 and 11.18;
(g) any amount required to be deposited by the Servicer in
connection with any REO Property pursuant to Subsection 11.12;
(h) any amounts payable in connection with the repurchase of any
Mortgage Loan pursuant to Subsection 7.03, and all amounts required to be
deposited by the Servicer in connection with shortfalls in principal
amount of Qualified Substitute Mortgage Loans pursuant to Subsection
7.03; and
(i) with respect to each Principal Prepayment, an amount (to be
paid by the Servicer out of its own funds) which, when added to all
amounts allocable to interest received in connection with the Principal
Prepayment, equals one month's interest on the amount of principal so
prepaid for the month of prepayment at the applicable Mortgage Loan
Remittance Rate; provided, however, that the Servicer's aggregate
obligations under this paragraph for any month shall be limited to the
total amount of Servicing Fees actually received with respect to the
Mortgage Loans by the Servicer during such month.
The foregoing requirements for deposit in the Custodial Account
shall be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of late payment charges,
assumption fees and other ancillary fees need not be deposited by the Servicer
in the Custodial Account.
The Servicer may invest the funds in the Custodial Account in
Eligible Investments designated in the name of the Servicer for the benefit of
the Purchaser, which shall mature not later than the Business Day next
preceding the Remittance Date next following the date of such investment
(except that (A) any investment in the institution with which the Custodial
Account is maintained may mature on such Remittance Date and (B) any other
investment may mature on such Remittance Date if the Servicer shall advance
funds on such Remittance Date, pending receipt thereof to the extent necessary
to make distributions to the Owner) and shall not be sold or disposed of prior
to maturity. Notwithstanding anything to the contrary herein and above, all
income and gain realized from any such investment shall be for the benefit of
the Servicer and shall be subject to withdrawal by the Servicer. The amount of
any losses incurred in respect of any such investments shall be deposited in
the Custodial Account by the Servicer out of its own funds immediately as
realized.
Subsection 11.05 Withdrawals From the Custodial Account. The
Servicer shall, from time to time, withdraw funds from the Custodial Account
for the following purposes:
(a) to make payments to the Purchaser in the amounts and in the
manner provided for in Subsection 11.14;
(b) to reimburse itself for P&I Advances, the Servicer's right to
reimburse itself pursuant to this subclause (b) with respect to any
Mortgage Loan being limited to related Liquidation Proceeds, Condemnation
Proceeds, Insurance Proceeds, REO Disposition Proceeds and such other
amounts as may be collected by the Servicer from the Mortgagor or
otherwise relating to the Mortgage Loan, it being understood that, in the
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case of any such reimbursement, the Servicer's right thereto shall be
prior to the rights of the Purchaser, except that, where the Seller is
required to repurchase a Mortgage Loan, pursuant to Subsection 7.03, the
Servicer's right to such reimbursement shall be subsequent to the payment
to the Purchaser of the Repurchase Price pursuant to Subsection 7.03, and
all other amounts required to be paid to the Purchaser with respect to
such Mortgage Loan;
(c) to reimburse itself for any unpaid Servicing Fees and for
unreimbursed Servicing Advances, the Servicer's right to reimburse itself
pursuant to this subclause (c) with respect to any Mortgage Loan being
limited to related Liquidation Proceeds, Condemnation Proceeds, Insurance
Proceeds, REO Disposition Proceeds and such other amounts as may be
collected by the Servicer from the Mortgagor or otherwise relating to the
Mortgage Loan, it being understood that, in the case of any such
reimbursement, the Servicer's right thereto shall be prior to the rights
of the Purchaser unless the Seller is required to repurchase a Mortgage
Loan pursuant to Subsection 7.03, in which case the Servicer's right to
such reimbursement shall be subsequent to the payment to the Purchaser of
the Repurchase Price pursuant to Subsection 7.03 and all other amounts
required to be paid to the Purchaser with respect to such Mortgage Loan;
(d) to reimburse itself for unreimbursed Servicing Advances and
for ▇▇▇▇▇▇▇▇▇▇▇▇ ▇&▇ Advances, in accordance with Subsection 11.16, to
the extent that such amounts are nonrecoverable by the Servicer pursuant
to subclause (b) or (c) above, provided that the Mortgage Loan for which
such advances were made is not required to be repurchased by the Seller
pursuant to Subsection 7.03;
(e) to reimburse itself for expenses incurred by and reimbursable
to it pursuant to Subsection 12.01;
(f) to withdraw amounts to make P&I Advances in accordance with
Subsection 11.16;
(g) to pay to itself any interest earned or any investment
earnings on funds deposited in the Custodial Account;
(h) to withdraw any amounts inadvertently deposited in the
Custodial Account; and
(i) to clear and terminate the Custodial Account upon the
termination of this Agreement.
Subsection 11.06 Establishment of Escrow Account; Deposits in
Escrow Account. The Servicer shall segregate and hold all funds collected and
received pursuant to each Mortgage Loan which constitute Escrow Payments
separate and apart from any of its own funds and general assets and shall
establish and maintain one or more Escrow Accounts (collectively, the "Escrow
Account"), titled "American Home Mortgage Servicing, Inc., in trust for ▇▇▇▇▇▇
▇▇▇▇▇▇▇ Mortgage Capital Inc. as Purchaser of Mortgage Loans and various
Mortgagors." The Escrow Account shall be established with a commercial bank, a
savings bank or a savings and loan association (which may be a depository
affiliate of Servicer), which meets the guidelines set
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forth by ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac as an eligible institution for escrow
accounts. In any case, the Escrow Account shall be insured by the FDIC in a
manner which shall provide maximum available insurance thereunder and which
may be drawn on by the Servicer. The creation of any Escrow Account shall be
evidenced by a certification in the form of Exhibit 6 hereto, in the case of
an account established with a depository affiliate of the Servicer, or by a
letter agreement in the form of Exhibit 7 hereto, in the case of an account
held by a depository. In either case, a copy of such certification or letter
agreement shall be furnished to the Purchaser upon request.
The Servicer shall deposit in the Escrow Account on a daily basis,
and retain therein: (a) 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 (b) all amounts
representing proceeds of any hazard insurance policy which are to be applied
to the restoration or repair of any Mortgaged Property. The Servicer shall
make withdrawals therefrom only in accordance with Subsection 11.07. As part
of its servicing duties, the Servicer shall pay to the Mortgagors interest on
funds in the Escrow Account, to the extent required by law.
Subsection 11.07 Withdrawals From Escrow Account. Withdrawals from
the Escrow Account shall be made by the Servicer only (a) to effect timely
payments of ground rents, taxes, assessments, fire and hazard insurance
premiums or other items constituting Escrow Payments for the related Mortgage,
(b) to reimburse the Servicer for any Servicing Advance made by Servicer
pursuant to Subsection 11.08 with respect to a related Mortgage Loan, (c) to
refund to any Mortgagor any funds found to be in excess of the amounts
required under the terms of the related Mortgage Loan, (d) for transfer to the
Custodial Account upon default of a Mortgagor or in accordance with the terms
of the related Mortgage Loan and if permitted by applicable law, (e) for
application to restore or repair of the Mortgaged Property, (f) to pay to the
Mortgagor, to the extent required by law, any interest paid on the funds
deposited in the Escrow Account, (g) to pay to itself any interest earned on
funds deposited in the Escrow Account (and not required to be paid to the
Mortgagor), (h) to the extent permitted under the terms of the related
Mortgage Note and applicable law, to pay late fees with respect to any Monthly
Payment which is received after the applicable grace period, (i) to withdraw
suspense payments that are deposited into the Escrow Account, (j) to withdraw
any amounts inadvertently deposited in the Escrow Account or (k) to clear and
terminate the Escrow Account upon the termination of this Agreement.
Subsection 11.08 Payment of Taxes, Insurance and Other Charges;
Collections Thereunder. With respect to each Mortgage Loan, the Servicer shall
maintain accurate records reflecting the status of ground rents, taxes,
assessments and other charges which are or may become a lien upon the
Mortgaged Property and the status of fire and hazard insurance coverage and
shall obtain, from time to time, all bills for the payment of such charges
(including renewal premiums) and shall effect payment thereof prior to the
applicable penalty or termination date and at a time appropriate for securing
maximum discounts allowable, 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. If a Mortgage does not provide for
Escrow Payments, the Servicer shall determine that any such payments are made
by the Mortgagor. The Servicer
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assumes full responsibility for the timely payment of all such bills and shall
effect timely payments of all such bills irrespective of each Mortgagor's
faithful performance in the payment of same or the making of the Escrow
Payments and shall make Servicing Advances to effect such payments, subject to
its ability to recover such Servicing Advances pursuant to Subsection
11.07(b). With respect to each Mortgage Loan that provides for Escrow
Payments, on or before January 31st of each year during the term of this
Agreement, beginning January 31, 2006, the Servicer shall ensure that all
taxes due during the prior calendar year have been paid on the related
Mortgaged Property.
Subsection 11.09 Transfer of Accounts. The Servicer may transfer
the Custodial Account or the Escrow Account to a different depository
institution. Such transfer shall be made only upon providing to the Purchaser
prior written notice including the name and address of the such depository
institution and the name of the account to which the Custodial Account or
Escrow Account, as applicable, is being transferred.
Subsection 11.10 Maintenance of Hazard Insurance. The Servicer
shall cause to be maintained for each Mortgage Loan fire and hazard insurance
with extended coverage customary in the area where the Mortgaged Property is
located that conforms to the requirements of ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac. If the
Mortgaged Property is in an area identified in the Federal Register by the
Federal Emergency Management Agency as having special flood hazards (and such
flood insurance has been made available) the Servicer will cause to be
maintained a flood insurance policy meeting the requirements of ▇▇▇▇▇▇ Mae or
▇▇▇▇▇▇▇ Mac. The Servicer shall also maintain on REO Property fire and hazard
insurance with extended coverage in an amount which meets the requirements of
▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac. Any amounts collected by the Servicer under any
such policies (other than amounts to be deposited in the Escrow Account and
applied to the restoration or repair of the property subject to the related
Mortgage or property acquired in liquidation of the Mortgage Loan, or to be
released to the Mortgagor in accordance with Accepted Servicing Procedures)
shall be deposited in the Custodial Account, subject to withdrawal pursuant to
Subsection 11.05. It is understood and agreed that no earthquake or other
additional insurance need be required by the Servicer of any Mortgagor or
maintained on REO Property other than pursuant to such applicable laws and
regulations as shall at any time be in force and as shall require such
additional insurance. All policies required hereunder shall be endorsed with
standard mortgagee clauses with loss payable to Servicer, and shall provide
for at least thirty (30) days prior written notice of any cancellation,
reduction in amount or material change in coverage to the Servicer. The
Servicer shall not interfere with the Mortgagor's freedom of choice in
selecting either its insurance carrier or agent; provided, however, that the
Servicer shall not accept any such insurance policies that do not conform to
the requirements of ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac.
Subsection 11.11 Fidelity Bond; Errors and Omissions Insurance.
The Servicer shall maintain, at its own expense, a blanket Fidelity Bond and
an errors and omissions insurance policy, with broad coverage on all officers,
employees or other persons acting in any capacity requiring such persons to
handle funds, money, documents or papers relating to the Mortgage Loans. These
policies shall insure the Servicer against losses resulting from dishonest or
fraudulent acts committed by the Servicer's personnel, any employees of
outside firms that provide data processing services for the Servicer, and
temporary contract employees or student interns. The Fidelity Bond shall also
protect and insure the Servicer against losses in connection
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with the release or satisfaction of a Mortgage Loan without having obtained
payment in full of the indebtedness secured thereby. No provision of this
Subsection 11.11 requiring such Fidelity Bond and errors and omissions
insurance shall diminish or relieve the Servicer of its duties and obligations
as set forth in this Agreement. The minimum coverage under any such Fidelity
Bond and insurance policy shall be at least equal to the corresponding amounts
required by ▇▇▇▇▇▇ Mae in the ▇▇▇▇▇▇ ▇▇▇ Servicing Guide or by ▇▇▇▇▇▇▇ Mac in
the ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇' & Servicers' Guide, as amended or restated from time
to time, or in an amount as may be permitted to the Servicer by express waiver
of ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac.
Subsection 11.12 Title, Management and Disposition of REO
Property. If title to the 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 Servicer or its nominee, in either case as nominee, for the
benefit of the Purchaser of record on the date of acquisition of title (the
"Owner"). If the Servicer 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, at the expense of the Purchaser, from an attorney duly
licensed to practice law in the state where the REO Property is located. The
Person or Persons holding such title other than the Owner shall acknowledge in
writing that such title is being held as nominee for the Owner.
The Servicer shall cause to be deposited on a daily basis in the
Custodial Account all revenues received with respect to the conservation and
disposition of the related REO Property and shall withdraw therefrom funds
necessary for the proper operation, management and maintenance of the REO
Property, including the cost of maintaining any hazard insurance pursuant to
Subsection 11.10 and the fees of any managing agent acting on behalf of the
Servicer. Any disbursement in excess of $5,000 shall be made only with the
written approval of the Purchaser. The Servicer shall make distributions as
required on each Remittance Date to the Purchaser of the net cash flow from
the REO Property (which shall equal the revenues from such REO Property net of
the expenses described above and of any reserves reasonably required from time
to time to be maintained to satisfy anticipated liabilities for such
expenses).
The disposition of REO Property shall be carried out by the
Servicer in accordance with the provisions of this Agreement and shall be made
at such price, and upon such terms and conditions, as the Servicer deems to be
in the best interests of the Owner. Upon the request of the Owner, and at the
Owner's expense, the Servicer shall cause an appraisal of the REO Property to
be performed for the Owner. The proceeds of sale of the REO Property shall be
promptly deposited in the Custodial Account and, as soon as practical
thereafter, the expenses of such sale shall be paid, the Servicer shall
reimburse itself for any related unreimbursed Servicing Advances, unpaid
Servicing Fees, unreimbursed advances made pursuant to Subsection 11.16 and
any appraisal performed pursuant to this paragraph and the net cash proceeds
of such sale remaining in the Custodial Account shall be distributed to the
Purchaser.
The Servicer shall either itself or through an agent selected by
the Servicer, 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
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shall attempt to sell the same (and may temporarily rent the same) on such
terms and conditions as the Servicer deems to be in the best interest of the
Owner.
If a REMIC election is or is to be made with respect to the
arrangement under which the Mortgage Loans and any REO Property are held, the
Servicer shall manage, conserve, protect and operate each REO Property in a
manner which does not cause such REO Property to fail to qualify as
"foreclosure property" within the meaning of Section 860G(a)(8) of the Code or
result in the receipt by such REMIC of any "income from non-permitted assets"
within the meaning of Section 860F(a)(2)(B) of the Code or any "net income
from foreclosure property" within the meaning of Section 860G(c)(2) of the
Code.
Upon request, with respect to any REO Property, the Servicer shall
furnish to the Owner a statement covering the Servicer's efforts in connection
with the sale of that REO Property and any rental of the REO Property
incidental to the sale thereof for the previous month (together with an
operating statement).
Subsection 11.13 Servicing Compensation. As compensation for its
services hereunder, the Servicer shall be entitled to retain the Servicing Fee
from interest payments on the Mortgage Loans. Additional servicing
compensation in the form of assumption fees, late payment charges and other
ancillary income shall be retained by the Servicer to the extent not required
to be deposited in the Custodial Account. 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 therefor except as
specifically provided for herein.
Subsection 11.14 Distributions. On each Remittance Date the
Servicer shall remit by wire transfer of immediately available funds to the
account designated in writing by the Purchaser of record on the preceding
Record Date (a) all Monthly Payments due in the Due Period relating to such
Remittance Date and received by the Servicer prior to the related
Determination Date, plus (b) all amounts, if any, which the Servicer is
obligated to distribute pursuant to Subsection 11.16, plus (c) any amounts
attributable to Principal Prepayments received in the calendar month preceding
the month in which the Remittance Date occurs, together with any additional
interest required to be deposited in the Custodial Account in connection with
such Principal Prepayments in accordance with Subsection 11.04(i), minus (d)
all amounts that may be withdrawn from the Custodial Account pursuant to
Subsections 11.05(b) through (e).
With respect to any remittance received by the Purchaser after the
Business Day on which such payment was due, the Servicer shall pay to the
Purchaser interest on any such late payment at an annual rate equal to the
Prime Rate, adjusted as of the date of each change, plus three percent (3%),
but in no event greater than the maximum amount permitted by applicable law.
Such interest shall be paid by the Servicer to the Purchaser on the date such
late payment is made and shall cover the period commencing with the Business
Day on which such payment was due and ending with the Business Day immediately
preceding the Business Day on which such payment is made, both inclusive. 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.
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Subsection 11.15 Statements to the Purchaser. Not later than the
10th calendar day of each month (or, if such 10th day is not a Business Day,
the following Business Day), the Servicer shall forward to the Purchaser in
hard copy or electronic format mutually acceptable to the Purchaser and the
Seller, a statement, substantially in the form of, and containing the
information fields set forth on, Exhibit 9. Such statement shall also include
information regarding delinquencies on Mortgage Loans, indicating the number
and aggregate principal amount of Mortgage Loans which are delinquent
(including number of days delinquent through liquidation of the related REO
Property) and the book value of any REO Property. The Servicer shall submit to
the Purchaser monthly a liquidation report with respect to each Mortgaged
Property sold in a foreclosure sale as of the related Record Date and not
previously reported. Such liquidation report shall be incorporated into the
remittance report delivered to Purchaser in the form of Exhibit 9 hereto.
In addition, within a reasonable period of time after the end of
each calendar year, the Servicer will furnish a report to each Person that was
a Purchaser at any time during such calendar year. Such report shall state the
aggregate of amounts distributed to the Purchaser for such calendar year. 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 Code.
The Servicer shall prepare and file any and all tax returns,
information statements or other filings required to be delivered to any
governmental taxing authority or to the Purchaser pursuant to any applicable
law with respect to the Mortgage Loans and the transactions contemplated
hereby. In addition, the Servicer shall provide the Purchaser with such
information concerning the Mortgage Loans as is necessary for such Purchaser
to prepare federal income tax returns as the Purchaser may reasonably request
from time to time.
Subsection 11.16 Advances by the Servicer. On the Business Day
immediately preceding each Remittance Date, the Servicer shall either (a)
deposit in the Custodial Account from its own funds an amount equal to the
aggregate amount of all Monthly Payments (with interest adjusted to the
Mortgage Loan Remittance Rate) which were due on the Mortgage Loans during the
applicable Due Period and which were delinquent at the close of business on
the immediately preceding Determination Date (each such advance, a "P&I
Advance"), (b) cause to be made an appropriate entry in the records of the
Custodial Account that amounts held for future distribution have been, as
permitted by this Subsection 11.16, used by the Servicer in discharge of any
such P&I Advance or (c) make P&I Advances in the form of any combination of
(a) or (b) aggregating the total amount of P&I Advances to be made. Any
amounts held for future distribution and so used shall be replaced by the
Servicer by deposit in the Custodial Account on or before any future
Remittance Date if funds in the Custodial Account on such Remittance Date
shall be less than payments to the Purchaser required to be made on such
Remittance Date. The Servicer's obligation to make P&I Advances as to any
Mortgage Loan will continue through the last Monthly Payment due prior to the
payment in full of a Mortgage Loan, or through the last Remittance Date prior
to the Remittance Date for the distribution of all other payments or
recoveries (including proceeds under any title, hazard or other insurance
policy, or condemnation awards) with respect to a Mortgage Loan; provided,
however, that such obligation shall cease (i) for any Mortgage Loan and on any
Remittance Date that the distribution of all Liquidation Proceeds and other
payments or recoveries (including
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Insurance Proceeds and Condemnation Proceeds) occurs with respect to such
Mortgage Loan or (ii) if the Servicer, in its good faith judgment, determines
that P&I Advances would not be recoverable pursuant to Subsection 11.05(d).
The determination by the Servicer that a P&I Advance, if made, would be
nonrecoverable, shall be evidenced by an Officer's Certificate of the
Servicer, delivered to the Purchaser, which details the reasons for such
determination.
Subsection 11.17 Assumption Agreements. The Servicer will use its
best efforts to enforce any "due-on-sale" provision contained in any Mortgage
or Mortgage Note, provided that the Servicer shall permit such assumption if
so required in accordance with the terms of the Mortgage or the Mortgage Note.
When the Mortgaged Property has been conveyed by the Mortgagor, the Servicer
will, to the extent it has knowledge of such conveyance, exercise its rights
to accelerate the maturity of such Mortgage Loan under the "due-on-sale"
clause applicable thereto; provided, however, the Servicer will not exercise
such rights if prohibited by law from doing so. In connection with any such
assumption, the outstanding principal amount, the Monthly Payment or the
Mortgage Interest Rate of the related Mortgage Note shall not be changed, and
the term of the Mortgage Loan will not be increased or decreased. If an
assumption is allowed pursuant to this Subsection 11.17, the Servicer is
authorized to enter into a substitution of liability agreement with the
purchaser of the Mortgaged Property pursuant to which the original Mortgagor
is released from liability and the purchaser of the Mortgaged Property is
substituted as Mortgagor and becomes liable under the Mortgage Note.
Subsection 11.18 Satisfaction of Mortgages and Release of Mortgage
Files. Upon the payment in full of any Mortgage Loan, or the receipt by the
Servicer of a notification that payment in full will be escrowed in a manner
customary for such purposes, the Servicer will obtain the portion of the
Mortgage File that is in the possession of the Purchaser or its designee,
prepare and process any required satisfaction or release of the Mortgage and
notify the Purchaser in accordance with the provisions of this Agreement. The
Purchaser agrees to deliver to the Servicer the original Mortgage Note for any
Mortgage Loan not later than three (3) Business Days following its receipt of
a notice from the Servicer that such a payment in full has been received or
that a notification has been received that such a payment in full shall be
made. Such Mortgage Note shall be held by the Servicer, in trust, for the
purpose of canceling such Mortgage Note and delivering the cancelled Mortgage
Note to the Mortgagor in a timely manner as and to the extent provided under
applicable state law. If the Mortgage has been recorded in the name of MERS or
its designee, the Servicer shall take all necessary action to effect the
release of the Mortgage Loan on the records of MERS.
If the Servicer grants a satisfaction or release of a Mortgage
without having obtained payment in full of the indebtedness secured by the
Mortgage or should the Servicer otherwise prejudice any right the Purchaser
may have under the mortgage instruments, the Servicer, upon written demand of
the Purchaser, shall remit to the Purchaser the Stated Principal Balance of
the related Mortgage Loan by deposit thereof in the Custodial Account. The
Fidelity Bond shall insure the Servicer against any loss it may sustain with
respect to any Mortgage Loan not satisfied in accordance with the procedures
set forth herein.
Subsection 11.19 [Reserved.]
Subsection 11.20 [Reserved.]
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Subsection 11.21 Servicer Shall Provide Access and Information as
Reasonably Required. The Servicer shall provide to the Purchaser, and for any
Purchaser insured by FDIC or NAIC, the supervisory agents and examiners of
FDIC and OTS or NAIC, access to any documentation regarding the Mortgage Loans
which may be required by applicable regulations. Such access shall be afforded
without charge, but only upon reasonable request, during normal business hours
and at the offices of the Servicer.
In addition, the Servicer shall furnish upon request by the
Purchaser, during the term of this Agreement, such periodic, special or other
reports or information, whether or not provided for herein, as shall be
necessary, reasonable and appropriate with respect to the purposes of this
Agreement and applicable regulations. All such reports or information shall be
provided by and in accordance with all reasonable instructions and directions
the Purchaser may require. The Servicer agrees to execute and deliver all such
instruments and take all such action as the Purchaser, from time to time, may
reasonably request in order to effectuate the purposes and to carry out the
terms of this Agreement.
Subsection 11.22 Transfer of Servicing. On the related Transfer
Date, if any, the Purchaser, or its designee, shall assume all servicing
responsibilities related to, and the Seller cease all servicing
responsibilities related to, the related Mortgage Loans subject to such
Transfer Date. On or prior to the related Transfer Date, the Seller shall, at
its sole cost and expense, take such steps as may be necessary or appropriate
to effectuate and evidence the transfer of the servicing of the related
Mortgage Loans to the Purchaser, or its designee, including but not limited to
the following:
(a) Notice to Mortgagors. The Seller shall mail to the Mortgagor
of each related Mortgage Loan a letter advising such Mortgagor of the
transfer of the servicing of the related Mortgage Loan to the Purchaser,
or its designee, in accordance with the ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ National
Affordable Housing Act of 1990, as amended; provided, however, the
content and format of the letter shall have the prior approval of the
Purchaser. The Seller shall provide the Purchaser with copies of all such
related notices no later than the related Transfer Date.
(b) Notice to Taxing Authorities and Insurance Companies. The
Seller shall transmit to the applicable taxing authorities and insurance
companies (including primary mortgage insurance policy insurers, if
applicable) and/or agents, notification of the transfer of the servicing
to the Purchaser, or its designee, and instructions to deliver all
notices, tax bills and insurance statements, as the case may be, to the
Purchaser from and after the related Transfer Date. The Seller shall
provide the Purchaser with copies of all such notices no later than the
related Transfer Date.
(c) Delivery of Servicing Records. The Seller shall forward to the
Purchaser, or its designee, all servicing records and the Servicing File
in the Seller's possession relating to each related Mortgage Loan.
(d) Escrow Payments. The Seller shall provide the Purchaser, or
its designee, with immediately available funds by wire transfer in the
amount of the net Escrow Payments and suspense balances and all loss
draft balances associated with the related
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Mortgage Loans. The Seller shall provide the Purchaser with an accounting
statement, in electronic format acceptable to the Purchaser in its sole
discretion, of Escrow Payments and suspense balances and loss draft
balances sufficient to enable the Purchaser to reconcile the amount of
such payment with the accounts of the Mortgage Loans. Additionally, the
Seller shall wire transfer to the Purchaser the amount of any agency,
trustee or prepaid Mortgage Loan payments and all other similar amounts
held by the Seller.
(e) Payoffs and Assumptions. The Seller shall provide to the
Purchaser, or its designee, copies of all assumption and payoff
statements generated by the Seller on the related Mortgage Loans from the
related Cut-off Date to the related Transfer Date.
(f) Mortgage Payments Received Prior to Transfer Date. Prior to
the related Transfer Date all payments received by the Seller on each
related Mortgage Loan shall be properly applied by the Seller to the
account of the particular Mortgagor.
(g) Mortgage Payments Received after Transfer Date. The amount of
any related Monthly Payments received by the Seller after the related
Transfer Date shall be forwarded to the Purchaser by overnight mail on
the date of receipt or by wire transfer on the next succeeding Business
Day. The Seller shall notify the Purchaser of the particulars of the
payment, which notification requirement shall be satisfied if the Seller
forwards with its payment sufficient information to permit appropriate
processing of the payment by the Purchaser. The Seller shall assume full
responsibility for the necessary and appropriate legal application of
such Monthly Payments received by the Seller after the related Transfer
Date with respect to related Mortgage Loans then in foreclosure or
bankruptcy; provided, for purposes of this Agreement, necessary and
appropriate legal application of such Monthly Payments shall include, but
not be limited to, endorsement of a Monthly Payment to the Purchaser with
the particulars of the payment such as the account number, dollar amount,
date received and any special Mortgagor application instructions and the
Seller shall comply with the foregoing requirements with respect to all
Monthly Payments received by the Seller after the related Transfer Date.
(h) Misapplied Payments. Misapplied payments shall be processed as
follows:
(i) All parties shall cooperate in correcting misapplication
errors;
(ii) The party receiving notice of a misapplied payment
occurring prior to the related Transfer Date and discovered after
such Transfer Date shall immediately notify the other party;
(iii) If a misapplied payment which occurred prior to the
related Transfer Date cannot be identified and said misapplied
payment has resulted in a shortage in a Custodial Account or Escrow
Account, the Seller shall be liable for the amount of such shortage.
The Seller shall reimburse the Purchaser for the amount of such
shortage within thirty (30) days after receipt of written demand
therefor from the Purchaser;
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(iv) If a misapplied payment which occurred prior to the
related Transfer Date has created an improper Purchase Price as the
result of an inaccurate outstanding principal balance, a check shall
be issued to the party shorted by the improper payment application
within five (5) Business Days after notice thereof by the other
party; and
(v) Any check issued under the provisions of this Section
11.22(h) shall be accompanied by a statement indicating the
corresponding Seller and/or the Purchaser Mortgage Loan
identification number and an explanation of the allocation of any
such payments.
(i) Books and Records. On the related Transfer Date, the books,
records and accounts of the Seller with respect to the related Mortgage
Loans shall be in accordance with all applicable Purchaser requirements.
(j) Reconciliation. The Seller shall, on or before the related
Transfer Date, reconcile principal balances and make any monetary
adjustments required by the Purchaser. Any such monetary adjustments will
be transferred between the Seller and the Purchaser as appropriate.
(k) IRS Forms. The Seller shall file or shall cause to be filed
all IRS forms 1099, 1099A, 1098 or 1041 and K-1 which are required to be
filed on or before the related Transfer Date in relation to the servicing
and ownership of the related Mortgage Loans. The Seller shall provide
copies of such forms to the Purchaser upon request and shall reimburse
the Purchaser for any costs or penalties incurred by the Purchaser due to
the Seller's failure to comply with this paragraph.
(l) Mortgage Loans in Foreclosure. The servicing with respect to
Mortgage Loans in foreclosure on or before the related Transfer Date
shall not be transferred from the Servicer to the Purchaser or its
designee, as the case may be, and such Mortgage Loans shall continue to
be serviced by the Servicer pursuant to the terms of this Agreement.
However, if the Purchaser so elects, the Purchaser may waive the
provisions of this paragraph and accept transfer of servicing of such
Mortgage Loans and all amounts received by the Servicer thereunder.
(m) Servicing Advances. The Servicer shall be entitled to be
reimbursed for all unreimbursed Servicing Advances with respect to any
Mortgage Loan on the related Transfer Date. This clause shall survive
each Transfer Date.
Subsection 11.23 Notification of Maturity Date. With respect to
each Mortgage Loan, the Seller shall execute and deliver to the Mortgagor any
and all necessary notices required under applicable law and the terms of the
related Mortgage Note and Mortgage regarding the maturity date if required
under applicable law.
Subsection 11.24 Notification of Adjustments. With respect to each
ARM Mortgage Loan, Seller shall adjust the Mortgage Interest Rate on the
related Interest Rate Adjustment Date and shall adjust the Monthly Payment on
the related Payment Adjustment Date in compliance with the requirements of
applicable law and the related Mortgage and Mortgage
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Note. If, pursuant to the terms of the Mortgage Note, another index is
selected for determining the Mortgage Interest Rate because the original index
is no longer available, the same index will be used with respect to each
Mortgage Note which requires a new index to be selected, provided that such
selection does not conflict with the terms of the related Mortgage Note.
Seller shall execute and deliver any and all necessary notices required under
applicable law and the terms of the related Mortgage Note and Mortgage
regarding the Mortgage Interest Rate and the Monthly Payment adjustments.
Seller shall promptly, upon written request therefor, deliver to the Purchaser
such notifications and any additional applicable data regarding such
adjustments and the methods used to calculate and implement such adjustments.
Upon the discovery by Seller or the Purchaser that Seller has failed to adjust
a Mortgage Interest Rate or a Monthly Payment pursuant to the terms of the
related Mortgage Note and Mortgage, Seller shall immediately deposit in the
Custodial Account, from its own funds, the amount of any interest loss caused
the Purchaser thereby without reimbursement therefor.
Section 12. The Servicer.
Subsection 12.01 Indemnification; Third Party Claims. The Servicer
agrees to indemnify and hold the Purchaser and any Successor Servicer and
their respective present and former directors, officers, employees and agents
harmless from any and all claims, losses, damages, penalties, fines,
forfeitures, reasonable legal fees and expenses (including, without
limitation, any legal fees and expenses, judgments or expenses relating to
such liability, claim, loss or damage) and related costs, judgments, and any
other costs, fees and expenses that such parties may sustain in any way
related to the Servicer's failure:
(a) to observe and perform any or all of Servicer's duties,
obligations, covenants, agreements, warranties or representations
contained in this Agreement or in the related Purchase Price and Terms
Agreement; or
(b) to comply with all applicable requirements contained in this
Agreement or the related Purchase Price and Terms Agreement with respect
to the servicing of the Mortgage Loan and the transfer of Servicing
Rights.
The Servicer immediately shall notify the Purchaser if a claim is
made by a third party with respect to this Agreement.
For purposes of this Section, "Purchaser" shall mean the Person
then acting as the Purchaser under this Agreement and any and all Persons who
previously were "Purchasers" under this Agreement and "Successor Servicer"
shall mean any Person designated as the Successor Servicer pursuant to this
Agreement and any and all Persons who previously were "Successor Servicers"
pursuant to this Agreement.
If any action is commenced for which indemnification may be
available under this Subsection 12.01 of which an indemnified party has
notice, promptly after receipt by such indemnified party under this Subsection
12.01 of notice of the commencement of such action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying
party under this Subsection 12.01, notify the indemnifying party in writing of
the commencement thereof; but the omission so to notify the indemnifying party
will not relieve the
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indemnifying party from any liability which it may have to any indemnified
party under this Subsection 12.01, except to the extent that it has been
prejudiced in any material respect, or from any liability which it may have,
otherwise than under this Subsection 12.01. In case any such action is brought
against any indemnified party and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein, and to the extent that it may elect by written notice delivered to
the indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party; provided that if the defendants in any
such action include both the indemnified party and the indemnifying party and
the indemnified party or parties shall have reasonably concluded that there
may be legal defenses available to it or them and/or other indemnified parties
which are different from or additional to those available to the indemnifying
party, the indemnified party or parties shall have the right to select
separate counsel to assert such legal defenses and to otherwise participate in
the defense of such action on behalf of such indemnified party or parties.
Upon receipt of notice from the indemnifying party to such indemnified party
of its election so to assume the defense of such action and approval by the
indemnified party of counsel, the indemnifying party will not be liable to
such indemnified party for expenses incurred by the indemnified party in
connection with the defense thereof unless (i) the indemnified party shall
have employed separate counsel in connection with the assertion of legal
defenses in accordance with the proviso to the next preceding sentence (it
being understood, however, that the indemnifying party shall not be liable for
the expenses of more than one separate counsel (together with one local
counsel, if applicable)), (ii) the indemnifying party shall not have employed
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of the
action or (iii) the indemnifying party has authorized in writing the
employment of counsel for the indemnified party at the expense of the
indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall be only in respect of the counsel referred to in such
clause (i) or (iii).
Notwithstanding anything to the contrary contained herein, in no
event shall a termination of this Agreement or the Servicer hereunder
terminate any indemnification obligations of the Servicer under this
Agreement, which obligations shall survive any such termination.
Subsection 12.02 Merger or Consolidation of the Servicer. The
Seller will keep in full effect its existence, rights and franchises under the
laws of its jurisdiction of incorporation or organization, and will obtain and
preserve its qualification to do business in each other 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 Seller may be merged or consolidated, or
any corporation resulting from any merger, conversion or consolidation to
which the Seller shall be a party, or any Person succeeding to the business of
the Seller, shall be the successor of the Seller hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding; provided,
however, that the successor or surviving Person shall be an institution whose
deposits are insured by FDIC or a company whose business is the origination
and servicing of mortgage loans, unless otherwise
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consented to by the Purchaser, which consent shall not be unreasonably
withheld, and shall be qualified to service mortgage loans on behalf of ▇▇▇▇▇▇
Mae or ▇▇▇▇▇▇▇ Mac.
Subsection 12.03 Limitation on Liability of the Servicer and
Others. The duties and obligations of the Servicer shall be determined solely
by the express provisions of this Agreement, the Servicer shall not be liable
except for the performance of such duties and obligations as are specifically
set forth in this Agreement and no implied covenants or obligations shall be
read into this Agreement against the Servicer. Neither the Servicer nor any of
the directors, officers, employees or agents of the Servicer shall be under
any liability to the Purchaser for any action taken or for refraining from the
taking of any action in accordance with Accepted Servicing Procedures and
otherwise in good faith pursuant to this Agreement or for errors in judgment;
provided, however, that this provision shall not protect the Servicer against
any liability resulting from any breach of any representation or warranty made
herein, or from any liability specifically imposed on the Servicer herein;
and, provided, further, that this provision shall not protect the Servicer
against any liability that would otherwise be imposed by reason of the willful
misfeasance, bad faith or negligence in the performance of duties or by reason
of reckless disregard of the obligations or duties hereunder. The Servicer and
any director, officer, employee or agent of the Servicer may rely on any
document of any kind which it in good faith reasonably believes to be genuine
and to have been adopted or signed by the proper authorities respecting any
matters arising hereunder. Subject to the terms of Subsection 12.01, the
Servicer shall have no obligation to appear with respect to, prosecute or
defend any legal action which is not incidental to the Servicer's duty to
service the Mortgage Loans in accordance with this Agreement.
Subsection 12.04 Seller and Servicer Not to Resign. With respect
to the retention of the Servicer to service the Mortgage Loans hereunder, the
Servicer acknowledges that the Purchaser has acted in reliance upon the
Servicer's independent status, the adequacy of its servicing facilities, plan,
personnel, records and procedures, its integrity, reputation and financial
standing and the continuance thereof. Without in any way limiting the
generality of this Section, for so long as the Servicer is servicing Mortgage
Loans pursuant to this Agreement, neither Seller nor Servicer shall assign
this Agreement or the servicing hereunder or delegate its rights or 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
approval of the Purchaser, which consent shall be granted or withheld in the
Purchaser's reasonable discretion or upon the Servicer's determination that
the Servicer's duties hereunder are no longer permissible under applicable law
and such incapacity cannot be cured by the Servicer. Any such determination
permitting the unilateral resignation of the Servicer shall be evidenced by an
Opinion of Counsel to such effect delivered to the Purchaser, which Opinion of
Counsel shall be in form and substance reasonably acceptable to the Purchaser.
No such resignation or assignment shall become effective until a successor has
assumed the Servicer's responsibilities and obligations hereunder in
accordance with Subsection 14.03.
Section 13. Default.
Subsection 13.01 Events of Default. In case one or more of the
following Events of Default by the Servicer shall occur and be continuing:
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(a) any failure by the Servicer to remit to the Purchaser any
payment required to be made under the terms of this Agreement which
continues unremedied for a period of two (2) 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 Purchaser;
(b) failure by the Servicer to duly observe or perform, in any
material respect, any other covenants, obligations or agreements of the
Servicer as set forth in this Agreement or any Custodial Agreement which
failure continues unremedied for a period of thirty (30) days (except
that such number of days shall be fifteen in the case of a failure to pay
any premium for any insurance policy required to be maintained under this
Agreement and such number of days shall be five in the case of a failure
to deliver any reports required to be delivered to the Purchaser
hereunder) after the date on which written notice of such failure,
requiring the same to be remedied, shall have been given to the Servicer
by the Purchaser;
(c) a decree or order of a court or agency or supervisory
authority having jurisdiction for the appointment of a conservator or
receiver or liquidator in any insolvency, bankruptcy, readjustment of
debt, marshalling of assets and liabilities or similar proceedings, or
for the winding-up or liquidation of its affairs, shall have been entered
against the Servicer and such decree or order shall have remained in
force, undischarged or unstayed for a period of sixty (60) days;
(d) the Servicer shall consent to the appointment of a conservator
or receiver or liquidator in any insolvency, bankruptcy, readjustment of
debt, marshalling of assets and liabilities or similar proceedings of or
relating to the Servicer or relating to all or substantially all of the
Servicer's property; or
(e) the Servicer shall admit in writing its inability to pay its
debts as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for
the benefit of its creditors, or voluntarily suspend payment of its
obligations;
then, and in each and every such case, so long as an Event of Default shall
not have been remedied, the Purchaser, by notice in writing to the Servicer,
may, in addition to whatever rights the Purchaser may have at law or equity to
damages, including injunctive relief and specific performance, commence
termination of all the rights and obligations of the Servicer under this
Agreement and in and to the Mortgage Loans and the proceeds thereof. Upon
receipt by the Servicer of such written notice from the Purchaser stating that
it intends to terminate the Servicer as a result of such Event of Default, 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 the
successor appointed pursuant to Subsection 14.03. Upon written request from
the Purchaser, the Servicer shall, in accordance with Subsection 11.22
prepare, execute and deliver to a successor any and all documents and other
instruments, place in such successor's possession all Mortgage Files and do or
cause to be done all other acts or things necessary or appropriate to effect
the purposes of such notice of termination, including, but not limited to, the
transfer and endorsement or assignment of the Mortgage Loans and related
documents to the successor at the
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Servicer's sole expense. The Servicer agrees to cooperate with the Purchaser
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 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.
Subsection 13.02 Waiver of Defaults. The Purchaser 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 thereto
except to the extent expressly so waived.
Section 14. Termination.
Subsection 14.01 Termination. The respective obligations and
responsibilities of the Servicer, as servicer, shall terminate upon (a) the
distribution to the Purchaser of the final payment or liquidation with respect
to the last Mortgage Loan (or advances of same by the Servicer); (b) the
disposition of all property acquired upon foreclosure or deed in lieu of
foreclosure with respect to the last Mortgage Loan and the remittance of all
funds due hereunder or (c) by mutual consent of the Servicer and the Purchaser
in writing. Upon written request from the Purchaser in connection with any
such termination, the Servicer shall prepare, execute and deliver, any and all
documents and other instruments, place in the Purchaser's possession all
Mortgage Files, and do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of the Mortgage Loans and
related documents, or otherwise, at the Purchaser's sole expense. The Servicer
agrees to cooperate with the Purchaser and such successor in effecting the
termination of the Servicer's responsibilities and rights hereunder as
servicer, including, without limitation, the transfer to such successor for
administration by it of all cash amounts which shall at the time be credited
by the Servicer to the Custodial Account or Escrow Account or thereafter
received with respect to the Mortgage Loans.
Subsection 14.02 Termination of the Servicer Without Cause.
Notwithstanding anything herein to the contrary, the Purchaser may terminate
the obligations and responsibilities of the Servicer in its capacity as
Servicer, without cause, upon payment to the Servicer of a termination fee
equal to one and one half percent (1.5%) of the aggregate outstanding
principal balance of the Mortgage Loans as of the date of such termination.
The termination fee provided for in this Subsection 14.02 shall be paid by the
Purchaser on the applicable Transfer Date.
Subsection 14.03 Successors to the Servicer. Prior to the
termination of the Servicer's responsibilities and duties under this Agreement
pursuant to Subsections 12.04, 13.01, 14.01 or 14.02, the Purchaser shall, (a)
succeed to and assume all of the Servicer's responsibilities, rights, duties
and obligations under this Agreement or (b) appoint a successor which shall
succeed to all rights and assume all of the responsibilities, duties and
liabilities of the Servicer under this Agreement upon such termination. In
connection with such appointment and assumption, the Purchaser may make such
arrangements for the compensation of such successor out of payments on
Mortgage Loans as it and such successor shall agree. If the Servicer's duties,
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responsibilities and liabilities under this Agreement shall be terminated
pursuant to the aforementioned Subsections, 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 Subsections shall not become
effective until a successor shall be appointed pursuant to this Subsection
14.03 and shall in no event relieve the Seller of the representations and
warranties made pursuant to Subsections 7.01 and 7.02 and the remedies
available to the Purchaser under Subsection 7.03, it being understood and
agreed that the provisions of such Subsections 7.01 and 7.02 shall be
applicable to the Seller notwithstanding any such resignation or termination
of the Servicer, or the termination of this Agreement.
Any successor appointed as provided herein shall execute,
acknowledge and deliver to the Servicer and to the Purchaser an instrument
accepting such appointment, 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
this Agreement pursuant to Subsections 12.04, 13.01, 14.01 or 14.02 shall not
affect any claims that the Purchaser may have against the Servicer arising
prior to any such termination or resignation.
Upon a successor's acceptance of appointment as such, the Servicer
shall notify by mail the Purchaser of such appointment.
Section 15. Cooperation of Seller with a Reconstitution. The Seller
and the Purchaser agree that with respect to some or all of the Mortgage
Loans, after the related Closing Date, on one or more dates (each, a
"Reconstitution Date") at the Purchaser's sole option, the Purchaser may
effect a sale (each, a "Reconstitution") of some or all of the Mortgage Loans
then subject to this Agreement, without recourse, to:
(a) ▇▇▇▇▇▇ ▇▇▇ under its Cash Purchase Program or MBS Program
(Special Servicing Option) (each, a "▇▇▇▇▇▇ Mae Transfer"); or
(b) ▇▇▇▇▇▇▇ Mac (the "▇▇▇▇▇▇▇ Mac Transfer"); or
(c) one or more third party purchasers in one or more Whole Loan
Transfers; or
(d) one or more trusts or other entities to be formed as part of
one or more Securitization Transactions.
The Seller agrees to execute in connection with any Agency
Transfer, any and all reasonably acceptable pool purchase contracts, and/or
agreements among the Purchaser, the Seller, ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac (as the
case may be) and any servicer in connection with a Whole Loan Transfer, a
seller's warranties and servicing agreement or a participation and servicing
agreement in form and substance reasonably acceptable to the parties, and in
connection with a Securitization Transaction, a pooling and servicing
agreement in form and
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substance reasonably acceptable to the parties or an Assignment and
Recognition Agreement substantially in the form attached hereto as Exhibit 15
(collectively, the agreements referred to herein are designated, the
"Reconstitution Agreements"), together with an opinion of counsel with respect
to such Reconstitution Agreements.
With respect to each Whole Loan Transfer and each Securitization
Transaction entered into by the Purchaser, the Seller agrees (1) to cooperate
fully with the Purchaser and any prospective purchaser with respect to all
reasonable requests and due diligence procedures; (2) to execute, deliver and
perform all Reconstitution Agreements required by the Purchaser; and (3) to
restate the representations and warranties set forth in this Agreement as of
the settlement or closing date in connection with such Reconstitution or make
the representations and warranties set forth in the related selling/servicing
guide of the servicer or issuer, as the case may be, or such representations
or warranties as may be required by any rating agency or prospective purchaser
of the related securities or such Mortgage Loans, in connection with such
Reconstitution. The Seller shall provide to such servicer or issuer, as the
case may be, and any other participants or purchasers in such Reconstitution:
(i) any and all information and appropriate verification of information which
may be reasonably available to the Seller or its affiliates, whether through
letters of its auditors and counsel or otherwise, as the Purchaser or any such
other participant shall request; (ii) such additional representations,
warranties, covenants, opinions of counsel, letters from auditors, and
certificates of public officials or officers of the Seller or the Servicer as
are reasonably believed necessary by the Purchaser or any such other
participant (including, without limitation, such revisions to this Agreement
relating to the servicing of REO Property and the provision of remittance
reports as the Purchaser may reasonably believe to be necessary to enable such
servicer to fulfill its master servicing obligations) and (iii) to execute,
deliver and satisfy all conditions set forth in any indemnity agreement
required by the Purchaser or any such participant, including, without
limitation, an Indemnification and Contribution Agreement in substantially the
form attached hereto as Exhibit 3. Moreover, the Seller agrees to cooperate
with all reasonable requests made by the Purchaser to effect such
Reconstitution Agreements. The Seller shall indemnify the Purchaser, each
Affiliate of the Purchaser participating in the Reconstitution, each Person
who controls the Purchaser or such Affiliate and each underwriter and initial
purchaser participating in the Reconstitution, and their respective present
and former directors, officers, employees and agents, and hold each of them
harmless from and against any losses, damages, penalties, fines, forfeitures,
legal fees and expenses and related costs, judgments, and any other costs,
fees and expenses that each of them may sustain arising out of or based upon
any untrue statement or alleged untrue statement of a material fact contained
in the information provided by or on behalf of the Seller regarding the Seller
(or if the Seller is not the originator, the originator of the Mortgage Loans)
or the Servicer, the Seller's or the Servicer's servicing practices or the
performance of the Mortgage Loans or the Underwriting Guidelines set forth in
any offering document prepared in connection with any Reconstitution. For
purposes of the previous sentence, "Purchaser" shall mean the Person then
acting as the Purchaser under this Agreement and any and all Persons who
previously were "Purchasers" under this Agreement.
All Mortgage Loans not sold or transferred pursuant to a
Reconstitution shall remain subject to this Agreement and shall continue to be
serviced in accordance with the terms of this Agreement, and with respect
thereto this Agreement shall remain in full force and effect.
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Section 16. Notices. All demands, notices and communications
hereunder shall be in writing and shall be given via email, facsimile
transmission or registered or certified mail to the person at the address set
forth below:
(a) if to the Purchaser:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc.
1221 Avenue of the ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ - Whole Loan Operations Manager
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
with copies to:
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ - Servicing Oversight
▇▇▇▇ ▇-▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇.▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ - RFPG
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
(b) if to the Servicer:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
American Home Mortgage Servicing, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
with a copy to:
▇▇▇▇ ▇▇▇▇, General Counsel
American Home Mortgage Servicing, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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(c) if to the Seller:
American Home Mortgage Corp.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
Fax:
Email: ▇▇▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
with copies to:
▇▇▇▇ ▇. ▇▇▇▇, General Counsel
American Home Mortgage Corp.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax:
Email: ▇▇▇▇.▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
or such other address as may hereafter be furnished to the other party by like
notice. Any such demand, notice or communication hereunder shall be deemed to
have been received on the date delivered to or received at the premises of the
addressee (as evidenced, in the case of registered or certified mail, by the
date noted on the return receipt).
Section 17. Severability Clause. 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 nearly as
possible the same as the economic effect of this Agreement without regard to
such invalidity.
Section 18. No Partnership. Nothing herein contained shall be
deemed or construed to create a co-partnership or joint venture between the
parties hereto and the services of the Servicer shall be rendered as an
independent contractor and not as agent for the Purchaser.
Section 19. 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.
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Section 20. Governing Law Jurisdiction. THIS AGREEMENT SHALL BE
DEEMED IN EFFECT WHEN A FULLY EXECUTED COUNTERPART THEREOF IS RECEIVED BY THE
PURCHASER IN THE STATE OF NEW YORK AND SHALL BE DEEMED TO HAVE BEEN MADE IN
THE STATE OF NEW YORK. THIS AGREEMENT SHALL BE GOVERNED BY THE INTERNAL LAWS
OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ITS CHOICE OF LAW RULES AND
PRINCIPLES. EACH OF THE PURCHASER AND THE SELLER IRREVOCABLY (I) SUBMITS TO
THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND THE
FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF
NEW YORK FOR THE PURPOSE OF ANY ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT; (II) WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE DEFENSE OF
AN INCONVENIENT FORUM IN ANY ACTION OR PROCEEDING IN ANY SUCH COURT; AND (III)
AGREES THAT A FINAL JUDGMENT IN ANY ACTION OR PROCEEDING IN ANY SUCH COURT
SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION BY SUIT ON
THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
Section 21. Mandatory Delivery; Grant of Security Interest. The
sale and delivery on the related Closing Date of the Mortgage Loans described
on the related Mortgage Loan Schedule is mandatory from and after the date of
the execution of the related Purchase Price and Terms Agreement, it being
specifically understood and agreed that each Mortgage Loan is unique and
identifiable on the date hereof and that an award of money damages would be
insufficient to compensate the Purchaser for the losses and damages incurred
by the Purchaser (including damages to prospective purchasers of the Mortgage
Loans) in the event of the Seller's failure to deliver (i) each of the related
Mortgage Loans or (ii) one or more Qualified Substitute Mortgage Loans or
(iii) one or more Mortgage Loans otherwise acceptable to the Purchaser on or
before the related Closing Date. The Seller hereby grants to the Purchaser a
lien on and a continuing security interest in each Mortgage Loan and each
document and instrument evidencing each such Mortgage Loan to secure the
performance by the Seller of its obligations under the related Purchase Price
and Terms Agreement, and the Seller agrees that it shall hold such Mortgage
Loans in custody for the Purchaser subject to the Purchaser's (i) right to
reject any Mortgage Loan (or Qualified Substitute Mortgage Loan) under the
terms of this Agreement and to require another Mortgage Loan (or Qualified
Substitute Mortgage Loan) to be substituted therefor, and (ii) obligation to
pay the Purchase Price for the Mortgage Loans. All rights and remedies of the
Purchaser under this Agreement are distinct from, and cumulative with, any
other rights or remedies under this Agreement or afforded by law or equity and
all such rights and remedies may be exercised concurrently, independently or
successively.
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Section 22. Intention of the Parties. It is the intention of the
parties that the Purchaser is purchasing, and the Seller is selling the
Mortgage Loans and not a debt instrument of the Seller or another security.
Accordingly, the parties hereto each intend to treat the transaction for
federal income tax purposes as a sale by the Seller, and a purchase by the
Purchaser, of the Mortgage Loans. Moreover, the arrangement under which the
Mortgage Loans are held shall be consistent with classification of such
arrangement as a grantor trust in the event it is not found to represent
direct ownership of the Mortgage Loans. The Purchaser shall have the right to
review the Mortgage Loans and the related Mortgage Loan Files to determine the
characteristics of the Mortgage Loans which shall affect the federal income
tax consequences of owning the Mortgage Loans and the Seller shall cooperate
with all reasonable requests made by the Purchaser in the course of such
review.
Section 23. Successors and Assigns. This Agreement shall bind and
inure to the benefit of and be enforceable by the Seller and the Purchaser and
the respective permitted successors and assigns of the Seller and the
successors and assigns of the Purchaser. This Agreement shall not be assigned,
pledged or hypothecated by the Seller to a third party without the prior
written consent of the Purchaser, which consent may be withheld by the
Purchaser in its sole discretion. This Agreement may be assigned, pledged or
hypothecated by the Purchaser in whole or in part, and with respect to one or
more of the Mortgage Loans, without the consent of the Seller. There shall be
no limitation on the number of assignments or transfers allowable by the
Purchaser with respect to the Mortgage Loans and this Agreement. In the event
the Purchaser assigns this Agreement, and the assignee assumes any of the
Purchaser's obligations hereunder, the Seller acknowledges and agrees to look
solely to such assignee, and not to the Purchaser, for performance of the
obligations so assumed and the Purchaser shall be relieved from any liability
to the Seller with respect thereto.
Section 24. 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 25. Exhibits. The exhibits to this Agreement are hereby
incorporated and made a part hereof and are an integral part of this
Agreement.
Section 26. 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;
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(d) 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 terms "include" and "including" shall mean without
limitation by reason of enumeration.
Section 27. Reproduction of Documents. This Agreement and all
documents relating thereto, including, without limitation, (a) consents,
waivers and modifications which may hereafter be executed, (b) documents
received by any party at the closing, and (c) financial statements,
certificates and other information previously or hereafter furnished, may be
reproduced by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties hereto agree that any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding, whether or not the original is in
existence and whether or not such reproduction was made by a party hereto in
the regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
Section 28. Amendment. This Agreement may be amended from time to
time by the Purchaser, the Seller and the Servicer by written agreement signed
by the parties hereto.
Section 29. Confidentiality. Each of the Purchaser, the Seller and
the Servicer shall employ proper procedures and standards designed to maintain
the confidential nature of the terms of this Agreement, except to the extent:
(a) the disclosure of which is reasonably believed by such party to be
required in connection with regulatory requirements or other legal
requirements relating to its affairs; (b) disclosed to any one or more of such
party's employees, officers, directors, agents, attorneys or accountants who
would have access to the contents of this Agreement and such data and
information in the normal course of the performance of such Person's duties
for such party, to the extent such party has procedures in effect to inform
such Person of the confidential nature thereof; (c) that is disclosed in a
prospectus, prospectus supplement or private placement memorandum relating to
a securitization of the Mortgage Loans by the Purchaser (or an affiliate
assignee thereof) or to any Person in connection with the resale or proposed
resale of all or a portion of the Mortgage Loans by such party in accordance
with the terms of this Agreement; and (d) that is reasonably believed by such
party to be necessary for the enforcement of such party's rights under this
Agreement.
Notwithstanding any other express or implied agreement to the
contrary, each of the Purchaser, the Seller and the Servicer agree and
acknowledge that each of them and each of their employees, representatives,
and other agents may disclose to any and all persons, without limitation of
any kind, the tax treatment and tax structure of the transaction and all
materials of any kind (including opinions or other tax analyses) that are
provided to any of them relating to such tax treatment and tax structure,
except to the extent that confidentiality is reasonably necessary to comply
with U.S. federal or state securities laws. For purposes of this paragraph,
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the terms "tax treatment" and "tax structure" have the meanings specified in
Treasury Regulation section 1.6011-4(c).
Section 30. Entire Agreement. This Agreement constitutes the
entire agreement and understanding relating to the subject matter hereof
between the parties hereto and any prior oral or written agreements between
them shall be deemed to have merged herewith.
Section 31. Further Agreements. The Seller, the Servicer and the
Purchaser each agree to execute and deliver to the other such reasonable and
appropriate additional documents, instruments or agreements as may be
necessary or appropriate to effectuate the purposes of this Agreement.
Section 32. No Solicitation. From and after the related Closing
Date, the Seller 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 Seller's behalf, to personally, by telephone or
mail, solicit a Mortgagor under any Mortgage Loan for the purpose of
refinancing a Mortgage Loan, in whole or in part, without the prior written
consent of the Purchaser. Notwithstanding the foregoing, it is understood and
agreed that the Seller, the Servicer or any of their respective affiliates:
(a) may advertise its availability for handling refinancings of
mortgages in its portfolio, including the promotion of terms it has
available for such refinancings, through the sending of letters or
promotional material, so long as it does not specifically target
Mortgagors;
(b) may provide pay-off information and otherwise cooperate with
individual mortgagors who contact it about prepaying their mortgages by
advising them of refinancing terms and streamlined origination
arrangements that are available; and
(c) may offer to refinance a Mortgage Loan made within thirty (30)
days following receipt by it of a pay-off request from the related
Mortgagor.
Promotions undertaken by the Seller or the Servicer or by any
affiliate of the Seller or the Servicer which are directed to the general
public at large (including, without limitation, mass mailing based on
commercially acquired mailing lists, newspaper, radio and television
advertisements), shall not constitute solicitation under this Section 32.
Section 33. Waiver of Jury Trial. THE SELLER AND THE PURCHASER
EACH KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY OF ANY
DISPUTE ARISING UNDER OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
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Section 34. Compliance With Regulation AB
Subsection 34.01 Intent of the Parties; Reasonableness.
The Purchaser, the Seller and the Servicer each acknowledge and
agree that the purpose of Section 34 of this Agreement is to facilitate
compliance by the Purchaser and any Depositor with the provisions of
Regulation AB and related rules and regulations of the Commission. Although
Regulation AB is applicable by its terms only to offerings of asset-backed
securities that are registered under the Securities Act, the Seller and the
Servicer each acknowledge that investors in privately offered securities may
require that the Purchaser or any Depositor provide comparable disclosure in
unregistered offerings. References in this Agreement to compliance with
Regulation AB include provision of comparable disclosure in private offerings.
Neither the Purchaser nor any Depositor shall exercise its right
to request delivery of information or other performance under these provisions
other than in good faith, or for purposes other than compliance with the
Securities Act, the Exchange Act and the rules and regulations of the
Commission thereunder (or the provision in a private offering of disclosure
comparable to that required under the Securities Act). The Seller and the
Servicer each acknowledge that interpretations of the requirements of
Regulation AB may change over time, whether due to interpretive guidance
provided by the Commission or its staff, consensus among participants in the
asset-backed securities markets, advice of counsel, or otherwise, and agrees
to comply with requests made by the Purchaser or any Depositor in good faith
for delivery of information under these provisions on the basis of evolving
interpretations of Regulation AB. In connection with any Securitization
Transaction, the Seller and the Servicer shall cooperate fully with the
Purchaser to deliver to the Purchaser (including any of its assignees or
designees) and any Depositor, any and all statements, reports, certifications,
records and any other information necessary in the good faith determination of
the Purchaser or any Depositor to permit the Purchaser or such Depositor to
comply with the provisions of Regulation AB, together with such disclosures
relating to the Seller, the Servicer, any Subservicer, any Third-Party
Originator and the Mortgage Loans, or the servicing of the Mortgage Loans,
reasonably believed by the Purchaser or any Depositor to be necessary in order
to effect such compliance.
Subsection 34.02 Additional Representations and Warranties of the
Seller.
(a) Each of the Seller and/or the Servicer, as applicable as to
itself, shall be deemed to represent to the Purchaser and to any
Depositor, as of the date on which information is first provided to the
Purchaser or any Depositor under Subsection 34.03 that, except as
disclosed in writing to the Purchaser or such Depositor prior to such
date: (i) neither the Seller nor the Servicer is aware and has not
received notice that any default, early amortization or other performance
triggering event has occurred as to any other securitization due to any
act or failure to act of the Servicer; (ii) the Servicer has not been
terminated as servicer in a residential mortgage loan securitization,
either due to a servicing default or to application of a servicing
performance test or trigger; (iii) no material noncompliance with the
applicable servicing criteria with respect to other securitizations of
residential mortgage loans involving the Servicer as servicer has been
disclosed or reported by the Servicer; (iv) no material changes to the
Servicer's policies
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or procedures with respect to the servicing function it will perform
under this Agreement and any Reconstitution Agreement for mortgage loans
of a type similar to the Mortgage Loans have occurred during the
three-year period immediately preceding the related Securitization
Transaction; (v) there are no aspects of the Servicer's financial
condition that could have a material adverse effect on the performance by
the Servicer of its servicing obligations under this Agreement or any
Reconstitution Agreement; (vi) there are no material legal or
governmental proceedings pending (or known to be contemplated) against
the Seller, the Servicer, any Subservicer or any Third-Party Originator;
and (vii) there are no affiliations, relationships or transactions
relating to the Seller, the Servicer, any Subservicer or any Third-Party
Originator with respect to any Securitization Transaction and any party
thereto identified by the related Depositor of a type described in Item
1119 of Regulation AB.
(b) If so requested by the Purchaser or any Depositor on any date
following the date on which information is first provided to the
Purchaser or any Depositor under Subsection 34.03, the Seller and the
Servicer shall, within five Business Days following such request, confirm
in writing the accuracy of the representations and warranties set forth
in paragraph (a) of this Section or, if any such representation and
warranty is not accurate as of the date of such request, provide
reasonably adequate disclosure of the pertinent facts, in writing, to the
requesting party.
Subsection 34.03 Information to Be Provided by the Seller or the
Servicer.
In connection with any Securitization Transaction the Seller and
the Servicer shall (i) within five Business Days following request by the
Purchaser or any Depositor, provide to the Purchaser and such Depositor (or,
as applicable, cause each Third-Party Originator and each Subservicer to
provide), in writing and in form and substance reasonably satisfactory to the
Purchaser and such Depositor, the information and materials specified in
paragraphs (a), (b), (c) and (f) of this Section, and (ii) as promptly as
practicable following notice to or discovery by the Seller or the Servicer,
provide to the Purchaser and any Depositor (in writing and in form and
substance reasonably satisfactory to the Purchaser and such Depositor) the
information specified in paragraph (d) of this Section.
(a) If so requested by the Purchaser or any Depositor, the Seller
shall provide such information regarding (i) the Seller, as originator of
the Mortgage Loans (including as an acquirer of Mortgage Loans from a
Qualified Correspondent), or (ii) each Third-Party Originator, and (iii)
as applicable, each Subservicer, as is requested for the purpose of
compliance with Items 1103(a)(1), 1105, 1110, 1117 and 1119 of Regulation
AB. Such information shall include, at a minimum:
(A) the originator's form of organization;
(B) a description of the originator's origination
program and how long the originator has been engaged in
originating residential mortgage loans, which description shall
include a discussion of the originator's experience in originating
mortgage loans of a similar type as the Mortgage Loans;
information regarding the size and composition of
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the originator's origination portfolio; and information that may
be material, in the good faith judgment of the Purchaser or any
Depositor, to an analysis of the performance of the Mortgage
Loans, including the originators' credit-granting or underwriting
criteria for mortgage loans of similar type(s) as the Mortgage
Loans and such other information as the Purchaser or any Depositor
may reasonably request for the purpose of compliance with Item
1110(b)(2) of Regulation AB;
(C) a description of any material legal or
governmental proceedings pending (or known to be contemplated)
against the Seller, each Third-Party Originator and each
Subservicer; and
(D) a description of any affiliation or relationship
between the Seller, each Third-Party Originator, each Subservicer
and any of the following parties to a Securitization Transaction,
as such parties are identified to the Seller by the Purchaser or
any Depositor in writing in advance of such Securitization
Transaction:
(1) the sponsor;
(2) the depositor;
(3) the issuing entity;
(4) any servicer;
(5) any trustee;
(6) any originator;
(7) any significant obligor;
(8) any enhancement or support provider; and
(9) any other material transaction party.
(b) Except with respect to any Securitization Transaction for
which less than 20% of the pool assets (measured by cut-off date
principal balance) are Mortgage Loans, if so requested by the Purchaser
or any Depositor, the Seller shall provide (or, as applicable, cause each
Third-Party Originator to provide) Static Pool Information with respect
to the mortgage loans (of a similar type as the Mortgage Loans, as
reasonably identified by the Purchaser as provided below) originated by
(i) the Seller, if the Seller is an originator of Mortgage Loans
(including as an acquirer of Mortgage Loans from a Qualified
Correspondent), and/or (ii) each Third-Party Originator. Such Static Pool
Information shall be prepared in form and substance reasonably
satisfactory to the Purchaser, by the Seller (or Third-Party Originator)
on the basis of its reasonable, good faith interpretation of the
requirements of Item 1105(a)(1)-(3) of Regulation AB. To the extent that
there is reasonably available to the Seller (or Third-Party Originator)
Static Pool Information with respect to more than one mortgage loan type,
the Purchaser or any Depositor shall be entitled to specify whether some
or all of such information shall be provided pursuant to this paragraph.
Such Static Pool Information for each vintage origination year or prior
securitized pool, as applicable, shall be presented in increments no less
frequently than quarterly over the life of the mortgage loans included in
the vintage origination year or prior securitized pool. The most recent
periodic increment must be as of a date no later than 135 days prior to
the date of the prospectus or other
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offering document in which the Static Pool Information is to be included
or incorporated by reference. The Static Pool Information shall be
provided in an electronic format that provides a permanent record of the
information provided, such as a portable document format (pdf) file, or
other such electronic format reasonably required by the Purchaser or the
Depositor, as applicable.
Promptly following notice or discovery of a material error in
Static Pool Information provided pursuant to the immediately preceding
paragraph (including an omission to include therein information required to be
provided pursuant to such paragraph), the Seller shall provide corrected
Static Pool Information to the Purchaser or any Depositor, as applicable, in
the same format in which Static Pool Information was previously provided to
such party by the Seller.
If so requested by the Purchaser or any Depositor, the Seller
shall provide (or, as applicable, cause each Third-Party Originator to
provide), at the expense of the requesting party (to the extent of any
additional incremental expense associated with delivery pursuant to this
Agreement), such agreed-upon procedures letters of certified public
accountants reasonably acceptable to the Purchaser or Depositor, as
applicable, pertaining to Static Pool Information relating to prior
securitized pools for securitizations closed on or after January 1, 2006 or,
in the case of Static Pool Information with respect to the Seller's or
Third-Party Originator's originations or purchases, to calendar months
commencing January 1, 2006, as the Purchaser or such Depositor shall
reasonably request. Such letters shall be addressed to and be for the benefit
of such parties as the Purchaser or such Depositor shall designate, which may
include, by way of example, any Sponsor, any Depositor and any broker dealer
acting as underwriter, placement agent or initial purchaser with respect to a
Securitization Transaction. Any such statement or letter may take the form of
a standard, generally applicable document accompanied by a reliance letter
authorizing reliance by the addressees designated by the Purchaser or such
Depositor.
(c) If so requested by the Purchaser or any Depositor, the
Servicer shall provide such information regarding the Servicer, as
servicer of the Mortgage Loans, and each Subservicer (each of the
Servicer and each Subservicer, for purposes of this paragraph, a
"Servicer"), as is requested for the purpose of compliance with Item 1108
of Regulation AB. Such information shall include, at a minimum:
(A) the Servicer's form of organization;
(B) a description of how long the Servicer has been
servicing residential mortgage loans; a general discussion of the
Servicer's experience in servicing assets of any type as well as a
more detailed discussion of the Servicer's experience in, and
procedures for, the servicing function it will perform under this
Agreement and any Reconstitution Agreements; information regarding
the size, composition and growth of the Servicer's portfolio of
residential mortgage loans of a type similar to the Mortgage Loans
and information on factors related to the Servicer that may be
material, in the good faith judgment of the Purchaser or any
Depositor, to any analysis of the servicing of the
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Mortgage Loans or the related asset-backed securities, as
applicable, including, without limitation:
(1) whether any prior securitizations of
mortgage loans of a type similar to the Mortgage Loans
involving the Servicer have defaulted or experienced
an early amortization or other performance triggering
event because of servicing during the three-year
period immediately preceding the related
Securitization Transaction;
(2) the extent of outsourcing the Servicer
utilizes;
(3) whether there has been previous
disclosure of material noncompliance with the
applicable servicing criteria with respect to other
securitizations of residential mortgage loans
involving the Servicer as a servicer during the
three-year period immediately preceding the related
Securitization Transaction;
(4) whether the Servicer has been
terminated as servicer in a residential mortgage loan
securitization, either due to a servicing default or
to application of a servicing performance test or
trigger; and
(5) such other information as the
Purchaser or any Depositor may reasonably request for
the purpose of compliance with Item 1108(b)(2) of
Regulation AB;
(C) a description of any material changes during the
three-year period immediately preceding the related Securitization
Transaction to the Servicer's policies or procedures with respect
to the servicing function it will perform under this Agreement and
any Reconstitution Agreements for mortgage loans of a type similar
to the Mortgage Loans;
(D) information regarding the Servicer's financial
condition, to the extent that there is a material risk that an
adverse financial event or circumstance involving the Servicer
could have a material adverse effect on the performance by the
Servicer of its servicing obligations under this Agreement or any
Reconstitution Agreement;
(E) information regarding advances made by the
Servicer on the Mortgage Loans and the Servicer's overall
servicing portfolio of residential mortgage loans for the
three-year period immediately preceding the related Securitization
Transaction, which may be limited to a statement by an authorized
officer of the Servicer to the effect that the Servicer has made
all advances required to be made on residential mortgage loans
serviced by it during such period, or, if such statement would not
be accurate, information regarding the percentage and type of
advances not made as required, and the reasons for such failure to
advance;
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(F) a description of the Servicer's processes and
procedures designed to address any special or unique factors
involved in servicing loans of a similar type as the Mortgage
Loans;
(G) a description of the Servicer's processes for
handling delinquencies, losses, bankruptcies and recoveries, such
as through liquidation of mortgaged properties, sale of defaulted
mortgage loans or workouts; and
(H) information as to how the Servicer defines or
determines delinquencies and charge-offs, including the effect of
any grace period, re-aging, restructuring, partial payments
considered current or other practices with respect to delinquency
and loss experience.
(d) If so requested by the Purchaser or any Depositor for the
purpose of satisfying its reporting obligation under the Exchange Act
with respect to any class of asset-backed securities, the Servicer shall
(or shall cause each Subservicer and Third-Party Originator to) (i)
notify the Purchaser and any Depositor in writing of (A) any material
litigation or governmental proceedings pending against the Servicer, any
Subservicer or any Third-Party Originator and (B) any affiliations or
relationships that develop following the closing date of a Securitization
Transaction between the Servicer, any Subservicer or any Third-Party
Originator and any of the parties specified in clause (D) of paragraph
(a) of this Section (and any other parties identified in writing by the
requesting party) with respect to such Securitization Transaction, and
(ii) provide to the Purchaser and any Depositor a description of such
proceedings, affiliations or relationships.
(e) As a condition to the succession to the Servicer or any
Subservicer as servicer or subservicer under this Agreement or any
Reconstitution Agreement by any Person (i) into which the Servicer or
such Subservicer may be merged or consolidated, or (ii) which may be
appointed as a successor to the Servicer or any Subservicer, the Servicer
shall provide to the Purchaser and any Depositor, at least 15 calendar
days prior to the effective date of such succession or appointment, (x)
written notice to the Purchaser and any Depositor of such succession or
appointment and (y) in writing and in form and substance reasonably
satisfactory to the Purchaser and such Depositor, all information
reasonably requested by the Purchaser or any Depositor in order to comply
with its reporting obligation under Item 6.02 of Form 8-K with respect to
any class of asset-backed securities.
(f) In addition to such information as the Servicer, as servicer,
is obligated to provide pursuant to other provisions of this Agreement,
if so requested by the Purchaser or any Depositor, the Servicer shall
provide such information regarding the performance or servicing of the
Mortgage Loans as is reasonably required by the Purchaser or any
Depositor to facilitate preparation of distribution reports in accordance
with Item 1121 of Regulation AB and to permit the Purchaser or such
Depositor to comply with the provisions of Regulation AB relating to
Static Pool Information regarding the performance of the Mortgage Loans
on the basis of the Purchaser's or such Depositor's
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reasonable, good faith interpretation of the requirements of Item
1105(a)(1)-(3) of Regulation AB (including without limitation as to the
format and content of such Static Pool Information). Such information
shall be provided concurrently with the monthly reports otherwise
required to be delivered by the Servicer under this Agreement commencing
with the first such report due in connection with the applicable
Securitization Transaction.
Subsection 34.04 Servicer Compliance Statement.
On or before March 10th of each calendar year, commencing in 2007,
the Servicer shall deliver to the Purchaser and any Depositor a statement of
compliance addressed to the Purchaser and such Depositor and signed by an
authorized officer of the Seller, to the effect that (i) a review of the
Servicer's activities during the immediately preceding calendar year (or
applicable portion thereof) and of its performance under this Agreement and
any applicable Reconstitution Agreement during such period has been made under
such officer's supervision, and (ii) to the best of such officers' knowledge,
based on such review, the Servicer has fulfilled all of its obligations under
this Agreement and any applicable Reconstitution Agreement in all material
respects throughout such calendar year (or applicable portion thereof) or, if
there has been a failure to fulfill any such obligation in any material
respect, specifically identifying each such failure known to such officer and
the nature and the status thereof.
Subsection 34.05 Report on Assessment of Compliance and
Attestation.
(a) On or before March 10th of each calendar year, commencing in
2007, the Servicer shall:
(i) deliver to the Purchaser and any Depositor a
report (in form and substance reasonably satisfactory to the
Purchaser and such Depositor) regarding the Servicer's assessment
of compliance with the Servicing Criteria during the immediately
preceding calendar year, as required under Rules 13a-18 and 15d-18
of the Exchange Act and Item 1122 of Regulation AB. Such report
shall be addressed to the Purchaser and such Depositor and signed
by an authorized officer of the Seller, and shall address each of
the Servicing Criteria specified on a certification substantially
in the form of Exhibit 17 hereto delivered to the Purchaser
concurrently with the execution of this Agreement;
(ii) deliver to the Purchaser and any Depositor a
report of a registered public accounting firm reasonably
acceptable to the Purchaser and such Depositor that attests to,
and reports on, the assessment of compliance made by the Seller
and delivered pursuant to the preceding paragraph. Such
attestation shall be in accordance with Rules 1-02(a)(3) and
2-02(g) of Regulation S-X under the Securities Act and the
Exchange Act;
(iii) cause each Subservicer, and each Subcontractor
determined by the Servicer pursuant to Subsection 34.06(b) to be
"participating in the servicing function" within the meaning of
Item 1122 of Regulation AB, to deliver to the
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Purchaser and any Depositor an assessment of compliance and
accountants' attestation as and when provided in paragraphs (a)
and (b) of this Section; and
(iv) deliver to the Purchaser, any Depositor and any
other Person that will be responsible for signing the
certification (a "Sarbanes Certification") required by Rules
13a-14(d) and 15d-14(d) under the Exchange Act (pursuant to
Section 302 of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002) on behalf of an
asset-backed issuer with respect to a Securitization Transaction a
certification in the form attached hereto as Exhibit 16.
The Servicer acknowledges that the parties identified in clause
(a)(iv) above may rely on the certification provided by the Servicer pursuant
to such clause in signing a Sarbanes Certification and filing such with the
Commission. Neither the Purchaser nor any Depositor will request delivery of a
certification under clause (a)(iv) above, unless a Depositor is required under
the Exchange Act to file an annual report on Form 10-K with respect to an
issuing entity whose asset pool includes Mortgage Loans.
(b) Each assessment of compliance provided by a Subservicer
pursuant to Subsection 34.05(a)(i) shall address each of the Servicing
Criteria specified on a certification substantially in the form of
Exhibit 17 hereto delivered to the Purchaser concurrently with the
execution of this Agreement or, in the case of a Subservicer subsequently
appointed as such, on or prior to the date of such appointment. An
assessment of compliance provided by a Subcontractor pursuant to
Subsection 34.05(a)(iii) need not address any elements of the Servicing
Criteria other than those specified by the Servicer pursuant to
Subsection 34.06.
Subsection 34.06 Use of Subservicers and Subcontractors.
The Servicer shall not hire or otherwise utilize the services of
any Subservicer to fulfill any of the obligations of the Servicer as servicer
under this Agreement or any Reconstitution Agreement unless the Servicer
complies with the provisions of paragraph (a) of this Section. The Servicer
shall not hire or otherwise utilize the services of any Subcontractor, and
shall not permit any Subservicer to hire or otherwise utilize the services of
any Subcontractor, to fulfill any of the obligations of the Servicer as
servicer under this Agreement or any Reconstitution Agreement unless the
Servicer complies with the provisions of paragraph (b) of this Section.
(a) The Servicer shall not hire or otherwise utilize the services
of any Subservicer with respect to the Mortgage Loans without giving the
Purchaser or its designee fifteen (15) calendar days' advance written
notice of the effective date of such hiring or utilization of a
Subservicer, followed by written confirmation of such hiring or
utilization of a Subservicer on the effective date of such engagement and
indicating the circumstances surrounding such hiring or utilization. Any
notices required by this Subsection 34.06(a) shall be sent via telecopier
or certified or registered mail to the addresses set forth below: ▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇, Servicer Oversight Group, ▇▇▇▇ ▇-▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Telecopy: ▇▇▇-▇▇▇-▇▇▇▇, and emailed to:
▇▇▇▇▇_▇▇▇▇▇▇▇▇_▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, with a copy to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
-▇▇-
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, LLP, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇▇▇, Telecopy: ▇▇▇-▇▇▇-▇▇▇▇, Email: ▇▇▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇.▇▇▇
(or such other address as such Person may otherwise specify to Seller).
The Servicer shall cause any Subservicer used by the Servicer (or by any
Subservicer) for the benefit of the Purchaser and any Depositor to comply
with the provisions of this Section and with Subsections 34.02, 34.03(c)
and (e), 34.04, 34.05 and 34.07 of this Agreement to the same extent as
if such Subservicer were the Servicer, and to provide the information
required with respect to such Subservicer under Subsection 34.03(d) of
this Agreement. The Servicer shall be responsible for obtaining from each
Subservicer and delivering to the Purchaser and any Depositor any
servicer compliance statement required to be delivered by such
Subservicer under Subsection 34.04, any assessment of compliance and
attestation required to be delivered by such Subservicer under Subsection
34.05 and any certification required to be delivered to the Person that
will be responsible for signing the Sarbanes Certification under
Subsection 34.05 as and when required to be delivered.
(b) It shall not be necessary for the Servicer to seek the consent
of the Purchaser or any Depositor to the utilization of any
Subcontractor. The Servicer shall promptly upon request provide to the
Purchaser and any Depositor (or any designee of the Depositor, such as a
master servicer or administrator) a written description (in form and
substance satisfactory to the Purchaser and such Depositor) of the role
and function of each Subcontractor utilized by the Servicer or any
Subservicer, specifying (i) the identity of each such Subcontractor, (ii)
which (if any) of such Subcontractors are "participating in the servicing
function" within the meaning of Item 1122 of Regulation AB, and (iii)
which elements of the Servicing Criteria will be addressed in assessments
of compliance provided by each Subcontractor identified pursuant to
clause (ii) of this paragraph.
As a condition to the utilization of any Subcontractor determined
to be "participating in the servicing function" within the meaning of Item
1122 of Regulation AB, the Servicer shall cause any such Subcontractor used by
the Seller (or by any Subservicer) for the benefit of the Purchaser and any
Depositor to comply with the provisions of Subsections 34.05 and 34.07 of this
Agreement to the same extent as if such Subcontractor were the Servicer. The
Servicer shall be responsible for obtaining from each Subcontractor and
delivering to the Purchaser and any Depositor any assessment of compliance and
attestation required to be delivered by such Subcontractor under Subsection
34.05, in each case as and when required to be delivered.
Subsection 34.07 Indemnification; Remedies.
(a) The Seller and the Servicer, jointly and severally, shall each
indemnify the Purchaser, each affiliate of the Purchaser, and each of the
following parties participating in a Securitization Transaction: each
sponsor and issuing entity; each Person responsible for the preparation,
execution or filing of any report required to be filed with the
Commission with respect to such Securitization Transaction, or for
execution of a certification pursuant to Rule 13a-14(d) or Rule 15d-14(d)
under the Exchange Act with respect to such Securitization Transaction;
each broker dealer acting as underwriter, placement agent or initial
purchaser, each Person who controls any of such parties or the
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Depositor (within the meaning of Section 15 of the Securities Act and
Section 20 of the Exchange Act); and the respective present and former
directors, officers, employees and agents of each of the foregoing and of
the Depositor, and shall hold each of them harmless from and against any
losses, damages, penalties, fines, forfeitures, legal fees and expenses
and related costs, judgments, and any other costs, fees and expenses that
any of them may sustain arising out of or based upon:
(i)(A) any untrue statement of a material fact contained or
alleged to be contained in any information, report, certification,
accountants' letter or other material provided in written or electronic
form under this Section 34 by or on behalf of the Seller or the
Servicer, or provided under this Section 34 by or on behalf of any
Subservicer, Subcontractor or Third-Party Originator (collectively, the
"Seller Information"), or (B) the omission or alleged omission to state
in the Seller Information a material fact required to be stated in the
Seller Information or necessary in order to make the statements therein,
in light of the circumstances under which they were made, not
misleading; provided, by way of clarification, that clause (B) of this
paragraph shall be construed solely by reference to the Seller
Information and not to any other information communicated in connection
with a sale or purchase of securities, without regard to whether the
Seller Information or any portion thereof is presented together with or
separately from such other information;
(ii) any failure by the Seller, the Servicer, any Subservicer, any
Subcontractor or any Third-Party Originator to deliver any information,
report, certification, accountants' letter or other material when and as
required under this Section 34, including any failure by the Servicer to
identify pursuant to Subsection 34.06(b) any Subcontractor
"participating in the servicing function" within the meaning of Item
1122 of Regulation AB; or
(iii) any breach by the Seller or the Servicer of a representation
or warranty set forth in Subsection 34.02(a) or in a writing furnished
pursuant to Subsection 34.02(b) and made as of a date prior to the
closing date of the related Securitization Transaction, to the extent
that such breach is not cured by such closing date, or any breach by the
Seller or the Servicer of a representation or warranty in a writing
furnished pursuant to Subsection 34.02(b) to the extent made as of a
date subsequent to such closing date.
In the case of any failure of performance described in clause
(a)(ii) of this Section, the Seller and the Servicer shall each promptly
reimburse the Purchaser, any Depositor, as applicable, and each Person
responsible for the preparation, execution or filing of any report required to
be filed with the Commission with respect to such Securitization Transaction,
or for execution of a certification pursuant to Rule 13a-14(d) or Rule
15d-14(d) under the Exchange Act with respect to such Securitization
Transaction, for all costs reasonably incurred by each such party in order to
obtain the information, report, certification, accountants' letter or other
material not delivered as required by the Seller, the Servicer, any
Subservicer, any Subcontractor or any Third-Party Originator.
(b) (i) Any failure by the Seller, the Servicer, any Subservicer,
any Subcontractor or any Third-Party Originator to deliver any
information, report,
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certification, accountants' letter or other material when and as required
under this Section 34, or any breach by the Seller or the Servicer of a
representation or warranty set forth in Subsection 34.02(a) or in a
writing furnished pursuant to Subsection 34.02(b) and made as of a date
prior to the closing date of the related Securitization Transaction, to
the extent that such breach is not cured by such closing date, or any
breach by the Seller or the Servicer of a representation or warranty in a
writing furnished pursuant to Subsection 34.02(b) to the extent made as
of a date subsequent to such closing date, shall, except as provided in
clause (ii) of this paragraph, immediately and automatically, without
notice or grace period, constitute an Event of Default with respect to
the Seller or the Servicer under this Agreement and any applicable
Reconstitution Agreement, and shall entitle the Purchaser or Depositor,
as applicable, in its sole discretion to terminate the rights and
obligations of the Seller and Servicer as servicer under this Agreement
and/or any applicable Reconstitution Agreement without payment
(notwithstanding anything in this Agreement or any applicable
Reconstitution Agreement to the contrary) of any compensation to the
Seller or the Servicer; provided that to the extent that any provision of
this Agreement and/or any applicable Reconstitution Agreement expressly
provides for the survival of certain rights or obligations following
termination of the Seller or the Servicer as servicer, such provision
shall be given effect.
(ii) Notwithstanding anything to the contrary in this
Agreement, any failure by the Servicer, any Subservicer or any
Subcontractor to deliver any information, report, certification or
accountants' letter when and as required under Subsection 34.04 or
34.05, including (except as provided below) any failure by the
Servicer to identify pursuant to Subsection 34.06(b) any
Subcontractor "participating in the servicing function" within the
meaning of Item 1122 of Regulation AB, which continues unremedied
for five calendar days after the date on which such information,
report, certification or accountants' letter was required to be
delivered shall constitute an Event of Default with respect to the
Servicer under this Agreement and any applicable Reconstitution
Agreement, and shall entitle the Purchaser or Depositor, as
applicable, in its sole discretion to terminate the rights and
obligations of the Servicer as servicer under this Agreement and/or
any applicable Reconstitution Agreement without payment
(notwithstanding anything in this Agreement to the contrary) of any
compensation to the Seller or the Servicer; provided that to the
extent that any provision of this Agreement and/or any applicable
Reconstitution Agreement expressly provides for the survival of
certain rights or obligations following termination of the Seller or
the Servicer as servicer, such provision shall be given effect.
Neither the Purchaser nor any Depositor shall be entitled to
terminate the rights and obligations of the Servicer pursuant to this
subparagraph (b)(ii) if a failure of the Servicer to identify a
Subcontractor "participating in the servicing function" within the
meaning of Item 1122 of Regulation AB was attributable solely to the
role or functions of such Subcontractor with respect to mortgage loans
other than the Mortgage Loans.
(iii) The Seller and the Servicer shall promptly reimburse the
Purchaser (or any designee of the Purchaser, such as a master
servicer) and any Depositor, as applicable, for all reasonable
expenses incurred by the Purchaser (or such
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designee) or such Depositor, as such are incurred, in connection
with the termination of the Servicer as servicer and the transfer of
servicing of the Mortgage Loans to a successor servicer. The
provisions of this paragraph shall not limit whatever rights the
Purchaser or any Depositor may have under other provisions of this
Agreement and/or any applicable Reconstitution Agreement or
otherwise, whether in equity or at law, such as an action for
damages, specific performance or injunctive relief.
[Signature Page Follows]
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IN WITNESS WHEREOF, the Purchaser, the Seller and the Servicer
have caused their names to be signed hereto by their respective officers
thereunto duly authorized on the date first above written.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ MORTGAGE CAPITAL INC.
By:____________________________________
Name:
Title:
AMERICAN HOME MORTGAGE CORP.
By:____________________________________
Name:
Title:
AMERICAN HOME MORTGAGE SERVICING, INC.
By:____________________________________
Name:
Title:
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EXHIBIT 1
MORTGAGE LOAN DOCUMENTS
With respect to each Mortgage Loan, the Mortgage Loan Documents
shall consist of the following:
(a) the original Mortgage Note bearing all intervening
endorsements, endorsed "Pay to the order of _________, without recourse" and
signed in the name of the last endorsee (the "Last Endorsee") by an authorized
officer. To the extent that there is no room on the face of the Mortgage Notes
for endorsements, the endorsement may be contained on an allonge, if state law
so allows and the Custodian is so advised by the Seller that state law so
allows. If the Mortgage Loan was acquired by the Seller in a merger, the
endorsement must be by "[Last Endorsee], successor by merger to [name of
predecessor]". If the Mortgage Loan was acquired or originated by the Last
Endorsee while doing business under another name, the endorsement must be by
"[Last Endorsee], formerly known as [previous name]";
(b) the original of any guarantee executed in connection with the
Mortgage Note;
(c) with respect to Mortgage Loans that are not Co-op Loans, the
original Mortgage with evidence of recording thereon. With respect to any
Co-op Loan, an original or copy of the Security Agreement. If in connection
with any Mortgage Loan, the Seller cannot deliver or cause to be delivered the
original Mortgage with evidence of recording thereon on or prior to the
Closing Date because of a delay caused by the public recording office where
such Mortgage has been delivered for recordation or because such Mortgage has
been lost or because such public recording office retains the original
recorded Mortgage, the Seller shall deliver or cause to be delivered to the
Custodian, a photocopy of such Mortgage, together with (i) in the case of a
delay caused by the public recording office, an Officer's Certificate of the
Seller (or certified by the title company, escrow agent, or closing attorney)
stating that such Mortgage has been dispatched to the appropriate public
recording office for recordation and that the original recorded Mortgage or a
copy of such Mortgage certified by such public recording office to be a true
and complete copy of the original recorded Mortgage will be promptly delivered
to the Custodian upon receipt thereof by the Seller; or (ii) in the case of a
Mortgage where a public recording office retains the original recorded
Mortgage or in the case where a Mortgage is lost after recordation in a public
recording office, a copy of such Mortgage certified by such public recording
office to be a true and complete copy of the original recorded Mortgage;
(d) the originals of all assumption, modification, consolidation
or extension agreements, if any, with evidence of recording thereon;
(e) with respect to Mortgage Loans that are not Co-op Loans, the
original Assignment of Mortgage for each Mortgage Loan, in form and substance
acceptable for recording (except with respect to MERS Designated Loans). The
Assignment of Mortgage must be duly recorded only if recordation is either
necessary under applicable law or commonly required by private institutional
mortgage investors in the area where the Mortgaged Property is located or on
direction of the Purchaser as provided in this Agreement. If the Assignment of
EXH-1-1
Mortgage is to be recorded, the Mortgage shall be assigned to the Purchaser.
If the Assignment of Mortgage is not to be recorded, the Assignment of
Mortgage shall be delivered in blank. If the Mortgage Loan was acquired by the
Seller in a merger, the Assignment of Mortgage must be made by "[Seller],
successor by merger to [name of predecessor]". If the Mortgage Loan was
acquired or originated by the Seller while doing business under another name,
the Assignment of Mortgage must be by "[Seller], formerly known as [previous
name]";
(f) with respect to Mortgage Loans that are not Co-op Loans, the
originals of all intervening assignments of mortgage (if any) evidencing a
complete chain of assignment from the Seller to the Last Endorsee (or, in the
case of a MERS Designated Loan, MERS) with evidence of recording thereon, or
if any such intervening assignment has not been returned from the applicable
recording office or has been lost or if such public recording office retains
the original recorded assignments of mortgage, the Seller shall deliver or
cause to be delivered to the Custodian, a photocopy of such intervening
assignment, together with (i) in the case of a delay caused by the public
recording office, an Officer's Certificate of the Seller (or certified by the
title company, escrow agent, or closing attorney) stating that such
intervening assignment of mortgage has been dispatched to the appropriate
public recording office for recordation and that such original recorded
intervening assignment of mortgage or a copy of such intervening assignment of
mortgage certified by the appropriate public recording office to be a true and
complete copy of the original recorded intervening assignment of mortgage will
be promptly delivered to the Custodian upon receipt thereof by the Seller; or
(ii) in the case of an intervening assignment where a public recording office
retains the original recorded intervening assignment or in the case where an
intervening assignment is lost after recordation in a public recording office,
a copy of such intervening assignment certified by such public recording
office to be a true and complete copy of the original recorded intervening
assignment;
(g) with respect to Mortgage Loans that are not Co-op Loans, the
original mortgagee policy of title insurance or, in the event such original
title policy is unavailable, a certified true copy of the related policy
binder or commitment for title certified to be true and complete by the title
insurance company;
(h) the original or, if unavailable, a copy of any security
agreement, chattel mortgage or equivalent document executed in connection with
the Mortgage;
(i) with respect to any Co-op Loan: (i) a copy of the Co-op Lease
and the assignment of such Co-op Lease, with all intervening assignments
showing a complete chain of title and an assignment thereof by Seller; (ii)
the stock certificate together with an undated stock power relating to such
stock certificate executed in blank; (iii) the recognition agreement of the
interests of the Mortgagee with respect to the Co-op Loan by the residential
cooperative housing corporation, the stock of which was pledged by the related
Mortgagor to the originator of such Co-op Loan; and (iv) copies of the
financial statement filed by the originator as secured party and, if
applicable, a filed UCC-3 assignment of the subject security interest showing
a complete chain of title, together with an executed UCC-3 assignment of such
security interest by the Seller in a form sufficient for filing; and
EXH-1-2
(j) if any of the above documents has been executed by a person
holding a power of attorney, an original or photocopy of such power certified
by the Seller to be a true and correct copy of the original.
In the event an Officer's Certificate of the Seller is delivered
to the Purchaser because of a delay caused by the public recording office in
returning any recorded document, the Seller shall deliver to the Purchaser,
within 90 days of the related Closing Date, an Officer's Certificate which
shall (i) identify the recorded document, (ii) state that the recorded
document has not been delivered to the Custodian due solely to a delay caused
by the public recording office, (iii) state the amount of time generally
required by the applicable recording office to record and return a document
submitted for recordation, and (iv) specify the date the applicable recorded
document will be delivered to the Custodian; provided, however, that any
recorded document shall in no event be delivered later than one year following
the related Closing Date. An extension of the date specified in clause (iv)
above may be requested from the Purchaser, which consent shall not be
unreasonably withheld.
EXH-1-3
EXHIBIT 2
CONTENTS OF EACH MORTGAGE FILE
With respect to each Mortgage Loan, the Mortgage File shall include each
of the following items, unless otherwise disclosed to the Purchaser on the
data tape, which shall be available for inspection by the Purchaser and which
shall be retained by the Servicer or delivered to the Purchaser:
(a) Copies of the Mortgage Loan Documents.
(b) Residential loan application.
(c) Mortgage Loan closing statement.
(d) Verification of employment and income, if required.
(e) Verification of acceptable evidence of source and amount of
downpayment.
(f) Credit report on Mortgagor, in a form acceptable to either
▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac.
(g) Residential appraisal report.
(h) Photograph of the Mortgaged Property and photographs of
comparable properties.
(i) Survey of the Mortgaged Property, unless a survey is not
required by the title insurer.
(j) Copy of each instrument necessary to complete identification
of any exception set forth in the exception schedule in the title policy,
i.e., map or plat, restrictions, easements, home owner association
declarations, etc.
(k) Copies of all required disclosure statements.
(l) If applicable, termite report, structural engineer's report,
water potability and septic certification.
(m) Sales Contract, if applicable.
(n) Copy of the owner's title insurance policy or attorney's
opinion of title and abstract of title, as applicable.
(o) Evidence of electronic notation of the hazard insurance
policy, and, if required by law, evidence of the flood insurance policy.
EXH-2-1
EXHIBIT 3
FORM OF INDEMNIFICATION AND CONTRIBUTION AGREEMENT
This INDEMNIFICATION AND CONTRIBUTION AGREEMENT ("Agreement"),
dated as of [_______], 200_, among [________________] (the "Depositor"), a
[______________] corporation (the "Depositor"), ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage
Capital Inc., a New York corporation ("▇▇▇▇▇▇") and [_____________], a
[_______________] (the "Seller").
W I T N E S S E T H:
WHEREAS, the Depositor is acting as depositor and registrant with
respect to the Prospectus, dated [________________], and the Prospectus
Supplement to the Prospectus, [________________] (the "Prospectus
Supplement"), relating to [________________] Certificates (the "Certificates")
to be issued pursuant to a Pooling and Servicing Agreement, dated as of
[________________] (the "P&S"), among the Depositor, as depositor,
[________________], as servicer (the "Servicer"), and [________________], as
trustee (the "Trustee");
WHEREAS, as an inducement to the Depositor to enter into the P&S,
and [____________________] (the "Underwriter[s]") to enter into the
Underwriting Agreement, dated [____________________] (the "Underwriting
Agreement"), between the Depositor and the Underwriter[s], and
[_______________] (the "Initial Purchaser[s]") to enter into the Certificate
Purchase Agreement, dated [____________] (the "Certificate Purchase
Agreement"), between the Depositor and the Initial Purchaser[s], Seller has
agreed to provide for indemnification and contribution on the terms and
conditions hereinafter set forth;
WHEREAS, ▇▇▇▇▇▇ purchased from Seller certain of the Mortgage
Loans underlying the Certificates (the "Mortgage Loans") pursuant to a
Mortgage Loan Sale and Servicing Agreement, dated as of January 1, 2006 (the
"Sale and Servicing Agreement"), by and between ▇▇▇▇▇▇, Seller and the
servicer; and
WHEREAS, pursuant to Section 15 of the Sale and Servicing
Agreement, the Seller has agreed to indemnify the Depositor, ▇▇▇▇▇▇, the
Underwriter[s], the Initial Purchaser[s] and their respective affiliates,
present and former directors, officers, employees and agents.
EXH-3-1
NOW THEREFORE, in consideration of the agreements contained
herein, and other valuable consideration the receipt and sufficiency of which
are hereby acknowledged, the Depositor, ▇▇▇▇▇▇ and the Seller agree as
follows:
1. Indemnification and Contribution.
(a) The Seller agrees to indemnify and hold harmless the
Depositor, ▇▇▇▇▇▇, the Underwriter[s], the Initial Purchaser[s] and their
respective affiliates and their respective present and former directors,
officers, employees and agents and each person, if any, who controls the
Depositor, ▇▇▇▇▇▇, the Underwriter[s] , the Initial Purchaser[s] or such
affiliate within the meaning of either Section 15 of the Securities Act of
1933, as amended (the "1933 Act"), or Section 20 of the Securities Exchange
Act of 1934, as amended (the "1934 Act"), against any and all losses, claims,
damages or liabilities, joint or several, to which they or any of them may
become subject under the 1933 Act, the 1934 Act or other federal or state
statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise
out of or are based in whole or in part upon any untrue statement or alleged
untrue statement of a material fact contained in the Prospectus Supplement,
the Offering Circular, the ABS Informational and Computational Materials or in
the Free Writing Prospectus or any omission or alleged omission to state in
the Prospectus Supplement, the Offering Circular, the ABS Informational and
Computational Materials or in the Free Writing Prospectus a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances in which they were made, not misleading, or any
such untrue statement or omission or alleged untrue statement or alleged
omission made in any amendment of or supplement to the Prospectus Supplement,
the Offering Circular, the ABS Informational and Computational Materials or
the Free Writing Prospectus and agrees to reimburse the Depositor, ▇▇▇▇▇▇, the
Underwriter[s], the Initial Purchaser[s] or such affiliates and each such
officer, director, employee, agent and controlling person promptly upon demand
for any legal or other expenses reasonably incurred by any of them in
connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that Seller shall be liable in any such case only to the
extent that any such loss, claim, damage, liability or action arises out of,
or is based upon, (i) any breach of the representation and warranty set forth
in Section 2(vii) below or (ii) any untrue statement or alleged untrue
statement or omission or alleged omission made in reliance upon and in
conformity with the Seller Information. The foregoing indemnity agreement is
in addition to any liability which Seller may otherwise have to the Depositor,
▇▇▇▇▇▇, the Underwriter[s], the Initial Purchaser[s] their affiliates or any
such director, officer, employee, agent or controlling person of the
Depositor, ▇▇▇▇▇▇, the Underwriter[s], the Initial Purchaser[s] or their
respective affiliates.
As used herein:
"Seller Information" means any information relating to Seller, the
Mortgage Loans and/or the underwriting guidelines relating to the Mortgage
Loans set forth in the Prospectus Supplement, the Offering Circular, the ABS
Informational and Computational Materials or the Free Writing Prospectus [and
static pool information regarding mortgage loans originated or acquired by the
Seller [and included in the Prospectus Supplement, the Offering Circular, the
ABS Informational and Computational Materials or the Free Writing Prospectus]
[incorporated by reference from the website located at ______________].
EXH-3-2
"Free Writing Prospectus" means any written communication that
constitutes a "free writing prospectus," as defined in Rule 405 under the 1933
Act.
"ABS Informational and Computational Material" means any written
communication as defined in Item 1101(a) of Regulation AB under the 1933 Act
and the 1934 Act, as amended from time to time.
"Offering Circular" means the offering circular, dated
[__________] relating to the private offering of the [_______________]
Certificates.
"Regulation AB": Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended
from time to time, and subject to such clarification and interpretation as
have been provided by the Commission in the adopting release (Asset-Backed
Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531
(Jan. 7, 2005)) or by the staff of the Commission, or as may be provided by
the Commission or its staff from time to time.
(b) Promptly after receipt by any indemnified party under this
Section 1 of notice of any claim or the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against
any indemnifying party under this Section 1, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however,
that the failure to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 1 except to the extent it has
been materially prejudiced by such failure; and provided, further, however,
that the failure to notify any indemnifying party shall not relieve it from
any liability which it may have to any indemnified party otherwise than under
this Section 1.
If any such claim or action shall be brought against an
indemnified party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein and, to the extent
that it wishes, jointly with any other similarly notified indemnifying party,
to assume the defense thereof with counsel reasonably satisfactory to the
indemnified party. After notice from the indemnifying party to the indemnified
party of its election to assume the defense of such claim or action, except as
provided in the following paragraph, the indemnifying party shall not be
liable to the indemnified party under this Section 1 for any legal or other
expenses subsequently incurred by the indemnified party in connection with the
defense thereof other than reasonable costs of investigation.
Any indemnified party shall have the right to employ separate
counsel in any such action and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such indemnified
party unless: (i) the employment thereof has been specifically authorized by
the indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
necessary or appropriate for such indemnified party to employ separate
counsel; or (iii) the indemnifying party has failed to assume the defense of
such action and employ counsel reasonably satisfactory to the indemnified
party, in which case, if such indemnified party notifies the indemnifying
party in writing that it elects to employ separate
EXH-3-3
counsel at the expense of the indemnifying party, the indemnifying party shall
not have the right to assume the defense of such action on behalf of such
indemnified party, it being understood, however, the indemnifying party shall
not, in connection with any one such action or separate but substantially
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys (in addition to local
counsel) at any time for all such indemnified parties.
Each indemnified party, as a condition of the indemnity agreements
contained in this Section 1, shall cooperate with the indemnifying party in
the defense of any such action or claim. No indemnifying party shall be liable
for any settlement of any such action effected without its written consent
(which consent shall not be unreasonably withheld), but if settled with its
written consent or if there be a final judgment for the plaintiff in any such
action, the indemnifying party agrees to indemnify and hold harmless any
indemnified party from and against any loss or liability by reason of such
settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for reasonable fees and expenses of counsel, the
indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have reimbursed
the indemnified party in accordance with such request prior to the date of
such settlement.
(c) If the indemnification provided for in this Section 1 is
unavailable to an indemnified party, then the indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages
or liabilities, in such proportion as is appropriate to reflect the relative
fault of the indemnifying party and the indemnified party, respectively, in
connection with the statements or omissions that result in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the indemnified party and indemnifying
party shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
such parties and their relative knowledge, access to information and
opportunity to correct or prevent such statement or omission and any other
equitable considerations.
(d) The indemnity and contribution agreements contained in this
Section 1 and the representations and warranties set forth in Section 2 shall
remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by the Depositor,
▇▇▇▇▇▇, the Underwriter[s], the Initial Purchaser[s], their respective
affiliates, directors, officers, employees or agents or any person controlling
the Depositor, ▇▇▇▇▇▇, the Underwriter[s], the Initial Purchaser[s] or any
such affiliate, and (iii) acceptance of and payment for any of the Offered
Certificates or Private Certificates.
EXH-3-4
2. Representations and Warranties. Seller represents and warrants
that:
(i) Seller is validly existing and in good standing under the
laws of its jurisdiction of formation or incorporation, as
applicable, and has full power and authority to own its assets and
to transact the business in which it is currently engaged. Seller
is duly qualified to do business and is in good standing in each
jurisdiction in which the character of the business transacted by
it or any properties owned or leased by it requires such
qualification and in which the failure so to qualify would have a
material adverse effect on the business, properties, assets or
condition (financial or otherwise) of Seller;
(ii) Seller is not required to obtain the consent of any other
person or any consent, license, approval or authorization from, or
registration or declaration with, any governmental authority,
bureau or agency in connection with the execution, delivery,
performance, validity or enforceability of this Agreement;
(iii) the execution, delivery and performance of this
Agreement by Seller will not violate any provision of any existing
law or regulation or any order decree of any court applicable to
Seller or any provision of the charter or bylaws of Seller, or
constitute a material breach of any mortgage, indenture, contract
or other agreement to which Seller is a party or by which it may
be bound;
(iv) (a) no proceeding of or before any court, tribunal or
governmental body is currently pending or, (b) to the knowledge of
Seller, threatened against Seller or any of its properties or with
respect to this Agreement or the Offered Certificates, in either
case, which would have a material adverse effect on the business,
properties, assets or condition (financial or otherwise) of
Seller;
(v) Seller has full power and authority to make, execute,
deliver and perform this Agreement and all of the transactions
contemplated hereunder, and has taken all necessary corporate
action to authorize the execution, delivery and performance of
this Agreement. When executed and delivered, this Agreement will
constitute the legal, valid and binding obligation of each of
Seller enforceable in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally, by the availability of
equitable remedies, and by limitations of public policy under
applicable securities law as to rights of indemnity and
contribution thereunder;
(vi) this Agreement has been duly executed and delivered by
Seller; and
(vii) the Seller represents that the Seller Information
satisfies the requirements of the applicable provisions of
Regulation AB.
3. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to Seller, will be mailed, delivered
or faxed or emailed and confirmed by mail [______________________]; if sent to
▇▇▇▇▇▇, ▇▇▇▇ be mailed, delivered or
EXH-3-5
faxed or emailed and confirmed by mail to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital
Inc., 1221 Avenue of the ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ - Whole Loans Operations Manager, Fax: [_______],
Email: ▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, with copies to (i) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ - Legal Counsel, Securities, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Fax [_____], Email:
▇▇▇▇▇▇▇▇.▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, and (ii) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ -
SPG Finance, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Fax [_____],Email: ▇▇▇▇▇▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇; if to the
Depositor, will be mailed, delivered or telegraphed and confirmed to
[____________________]; or if to the Underwriter[s], will be mailed, delivered
or telegraphed and confirmed to [_____________________]; or if to the Initial
Purchaser[s], will be mailed, delivered or telegraphed and confirmed to
[_____________________].
4. Miscellaneous. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York without giving
effect to the conflict of laws provisions thereof. This Agreement shall inure
to the benefit of and be binding upon the parties hereto and their successors
and assigns and the controlling persons referred to herein, and no other
person shall have any right or obligation hereunder. Neither this Agreement
nor any term hereof may be changed, waived, discharged or terminated orally,
but only by an instrument in writing signed by the party against whom
enforcement of the change, waiver, discharge or termination is sought. This
Agreement may be executed in counterparts, each of which when so executed and
delivered shall be considered an original, and all such counterparts shall
constitute one and the same instrument. Capitalized terms used but not defined
herein shall have the meanings provided in the P&S.
[SIGNATURE PAGE FOLLOWS]
EXH-3-6
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed by their respective officers hereunto duly authorized,
this __th day of [_____________].
[DEPOSITOR]
By: ___________________________________
Name:
Title:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ MORTGAGE CAPITAL INC.
By:____________________________________
Name:
Title:
[SELLER]
By:____________________________________
Name:
Title:
EXH-3-7
EXHIBIT 4
CUSTODIAL ACCOUNT CERTIFICATION
_________ __, 200__
[_____________________] hereby certifies that it has established
the account described below as a Custodial Account pursuant to Subsection
11.04 of the Mortgage Loan Sale and Servicing Agreement, dated as of January
1, 2006, Fixed and Adjustable Rate Mortgage Loans.
Title of Account: "American Home Mortgage Servicing, Inc., in trust for
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. as Purchaser of Mortgage Loans and
various Mortgagors."
Account Number: __________________________
Address of office or
branch of [_____________________]
at which the Custodial
Account is maintained: ______________________
______________________
______________________
[SERVICER]
By:____________________________________
Name:
Title:
EXH. 4-1
EXHIBIT 5
CUSTODIAL ACCOUNT LETTER AGREEMENT
_________ __, 200__
To:
(the "Depository")
As Servicer under the Mortgage Loan Sale and Servicing Agreement,
dated as of January 1, 2006, we hereby authorize and request you to establish
an account, as a Custodial Account, to be designated as "American Home
Mortgage Servicing, Inc., in trust for ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. as
Purchaser of Mortgage Loans and various Mortgagors." All deposits in the
account shall be subject to withdrawal therefrom by order signed by the
Servicer. You may refuse any deposit which would result in violation of the
requirement that the account be fully insured as described below. This letter
is submitted to you in duplicate. Please execute and return one original to
us.
[SERVICER]
By:____________________________________
Name:
Title:
EXH-5-1
The undersigned, as Depository, hereby certifies that the
above-described account has been established under Account Number
____________________ at the office of the Depository indicated above, and
agrees to honor withdrawals on such account as provided above. The account
will be insured by the Federal Deposit Insurance Corporation through the Bank
Insurance Fund ("BIF") or the Savings Association Insurance Fund ("SAIF").
[___________________________],
as Depository
By:____________________________________
Name:
Title:
Date:
EXH-5-2
EXHIBIT 6
ESCROW ACCOUNT CERTIFICATION
_________ __, 200__
[_____________________] hereby certifies that it has established
the account described below as an Escrow Account pursuant to Subsection 11.06
of the Mortgage Loan Sale and Servicing Agreement, dated as of January 1, 2006
Fixed and Adjustable Rate Mortgage Loans.
Title of Account: "American Home Mortgage Servicing, Inc., in trust for
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. as Purchaser of Mortgage Loans and
various Mortgagors."
Account Number: __________________________
Address of office or
branch of [_____________________]
at which the Escrow
Account is maintained: ______________________
______________________
______________________
[SERVICER]
By:____________________________________
Name:
Title:
EXH. 6-1
EXHIBIT 7
ESCROW ACCOUNT LETTER AGREEMENT
_________ __, 200__
To:
(the "Depository")
As Servicer under the Mortgage Loan Sale and Servicing Agreement,
dated as of January 1, 2006, we hereby authorize and request you to establish
an account, as an Escrow Account, to be designated as "American Home Mortgage
Servicing, Inc., in trust for ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. as
Purchaser of Mortgage Loans and various Mortgagors." All deposits in the
account shall be subject to withdrawal therefrom by order signed by the
Servicer. You may refuse any deposit which would result in violation of the
requirement that the account be fully insured as described below. This letter
is submitted to you in duplicate. Please execute and return one original to
us.
[SERVICER]
By:____________________________________
Name:
Title:
EXH-7-1
The undersigned, as Depository, hereby certifies that the
above-described account has been established under Account Number
____________________ at the office of the Depository indicated above, and
agrees to honor withdrawals on such account as provided above. The account
will be insured by the Federal Deposit Insurance Corporation through the Bank
Insurance Fund ("BIF") or the Savings Association Insurance Fund ("SAIF").
[____________________],
as Depository
By:____________________________________
Name:
Title:
Date:
EXH-7-2
EXHIBIT 8
[RESERVED]
EXH. 8-1
EXHIBIT 9
FORM OF MONTHLY REMITTANCE REPORT
Standard File Layout - Master Servicing
------------------------------------------------------------------------------------------------------
Column Name Description Decimal Format Comment Max
Size
--------------------------- -------------------------------- ------- -------------------------- ------
SER_INVESTOR_NBR A value assigned by the Servicer Text up to 10 digits 20
to define a group of loans.
--------------------------- -------------------------------- ------- -------------------------- ------
LOAN_NBR A unique identifier assigned Text up to 10 digits 10
to each loan by the investor.
--------------------------- -------------------------------- ------- -------------------------- ------
SERVICER_LOAN_NBR A unique number assigned to a Text up to 10 digits 10
loan by the Servicer. This
may be different than the
LOAN_NBR.
--------------------------- -------------------------------- ------- -------------------------- ------
BORROWER_NAME The borrower name as received Maximum length of 30 30
in the file. It is not (Last, First)
separated by first and last
name.
--------------------------- -------------------------------- ------- -------------------------- ------
SCHED_PAY_AMT Scheduled monthly principal 2 No commas(,) or dollar 11
and scheduled interest payment signs ($)
that a borrower is expected to
pay, P&I constant.
--------------------------- -------------------------------- ------- -------------------------- ------
NOTE_INT_RATE The loan interest rate as 4 Max length of 6 6
reported by the Servicer.
--------------------------- -------------------------------- ------- -------------------------- ------
NET_INT_RATE The loan gross interest rate 4 Max length of 6 6
less the service fee rate as
reported by the Servicer.
--------------------------- -------------------------------- ------- -------------------------- ------
SERV_FEE_RATE The servicer's fee rate for a 4 Max length of 6 6
loan as reported by the
Servicer.
--------------------------- -------------------------------- ------- -------------------------- ------
SERV_FEE_AMT The servicer's fee amount for 2 No commas(,) or dollar 11
a loan as reported by the signs ($)
Servicer.
--------------------------- -------------------------------- ------- -------------------------- ------
NEW_PAY_AMT The new loan payment amount as 2 No commas(,) or dollar 11
reported by the Servicer. signs ($)
--------------------------- -------------------------------- ------- -------------------------- ------
NEW_LOAN_RATE The new loan rate as reported 4 Max length of 6 6
by the Servicer.
--------------------------- -------------------------------- ------- -------------------------- ------
ARM_INDEX_RATE The index the Servicer is 4 Max length of 6 6
using to calculate a
forecasted rate.
--------------------------- -------------------------------- ------- -------------------------- ------
ACTL_BEG_PRIN_BAL The borrower's actual 2 No commas(,) or dollar 11
principal balance at the signs ($)
beginning of the processing
cycle.
--------------------------- -------------------------------- ------- -------------------------- ------
ACTL_END_PRIN_BAL The borrower's actual 2 No commas(,) or dollar 11
principal balance at the end signs ($)
of the processing cycle.
--------------------------- -------------------------------- ------- -------------------------- ------
BORR_NEXT_PAY_DUE_DATE The date at the end of MM/DD/YYYY 10
processing cycle that the
borrower's next payment is due
to the Servicer, as reported
by Servicer.
--------------------------- -------------------------------- ------- -------------------------- ------
SERV_CURT_AMT_1 The first curtailment amount 2 No commas(,) or dollar 11
to be applied. signs ($)
--------------------------- -------------------------------- ------- -------------------------- ------
SERV_CURT_DATE_1 The curtailment date MM/DD/YYYY 10
associated with the first
curtailment amount.
--------------------------- -------------------------------- ------- -------------------------- ------
CURT_ADJ_ AMT_1 The curtailment interest on 2 No commas(,) or dollar 11
the first curtailment amount, signs ($)
if applicable.
--------------------------- -------------------------------- ------- -------------------------- ------
SERV_CURT_AMT_2 The second curtailment amount 2 No commas(,) or dollar 11
to be applied. signs ($)
--------------------------- -------------------------------- ------- -------------------------- ------
SERV_CURT_DATE_2 The curtailment date MM/DD/YYYY 10
associated with the second
curtailment amount.
--------------------------- -------------------------------- ------- -------------------------- ------
CURT_ADJ_ AMT_2 The curtailment interest on 2 No commas(,) or dollar 11
the second curtailment amount, signs ($)
if applicable.
--------------------------- -------------------------------- ------- -------------------------- ------
SERV_CURT_AMT_3 The third curtailment amount 2 No commas(,) or dollar 11
to be applied. signs ($)
--------------------------- -------------------------------- ------- -------------------------- ------
EXH-10-1
--------------------------- -------------------------------- ------- -------------------------- ------
SERV_CURT_DATE_3 The curtailment date MM/DD/YYYY 10
associated with the third
curtailment amount.
--------------------------- -------------------------------- ------- -------------------------- ------
CURT_ADJ_AMT_3 The curtailment interest on 2 No commas(,) or dollar 11
the third curtailment amount, signs ($)
if applicable.
--------------------------- -------------------------------- ------- -------------------------- ------
PIF_AMT The loan "paid in full" amount 2 No commas(,) or dollar 11
as reported by the Servicer. signs ($)
--------------------------- -------------------------------- ------- -------------------------- ------
PIF_DATE The paid in full date as MM/DD/YYYY 10
reported by the Servicer.
--------------------------- -------------------------------- ------- -------------------------- ------
Action Code Key: 2
15=Bankruptcy,
ACTION_CODE The standard FNMA numeric code 30=Foreclosure, 60=PIF,
used to indicate the default/ 63=Substitution,
delinquent status of a 65=Repurchase,70=REO
particular loan.
--------------------------- -------------------------------- ------- -------------------------- ------
INT_ADJ_AMT The amount of the interest 2 No commas(,) or dollar 11
adjustment as reported by the signs ($)
Servicer.
--------------------------- -------------------------------- ------- -------------------------- ------
SOLDIER_SAILOR_ADJ_AMT The Soldier and Sailor 2 No commas(,) or dollar 11
Adjustment amount, if signs ($)
applicable.
--------------------------- -------------------------------- ------- -------------------------- ------
NON_ADV_LOAN_AMT The Non Recoverable Loan 2 No commas(,) or dollar 11
Amount, if applicable. signs ($)
--------------------------- -------------------------------- ------- -------------------------- ------
LOAN_LOSS_AMT The amount the Servicer is 2 No commas(,) or dollar 11
passing as a loss, if signs ($)
applicable.
--------------------------- -------------------------------- ------- -------------------------- ------
SCHED_BEG_PRIN_BAL The scheduled outstanding 2 No commas(,) or dollar 11
principal amount due at the signs ($)
beginning of the cycle date to
be passed through to investors.
--------------------------- -------------------------------- ------- -------------------------- ------
SCHED_END_PRIN_BAL The scheduled principal 2 No commas(,) or dollar 11
balance due to investors at signs ($)
the end of a processing cycle.
--------------------------- -------------------------------- ------- -------------------------- ------
SCHED_PRIN_AMT The scheduled principal amount 2 No commas(,) or dollar 11
as reported by the Servicer signs ($)
for the current cycle -- only
applicable for
Scheduled/Scheduled Loans.
--------------------------- -------------------------------- ------- -------------------------- ------
SCHED_NET_INT The scheduled gross interest 2 No commas(,) or dollar 11
amount less the service fee signs ($)
amount for the current cycle
as reported by the Servicer --
only applicable for
Scheduled/Scheduled Loans.
--------------------------- -------------------------------- ------- -------------------------- ------
ACTL_PRIN_AMT The actual principal amount 2 No commas(,) or dollar 11
collected by the Servicer for signs ($)
the current reporting cycle --
only applicable for
Actual/Actual Loans.
--------------------------- -------------------------------- ------- -------------------------- ------
ACTL_NET_INT The actual gross interest 2 No commas(,) or dollar 11
amount less the service fee signs ($)
amount for the current
reporting cycle as reported by
the Servicer -- only
applicable for Actual/Actual
Loans.
--------------------------- -------------------------------- ------- -------------------------- ------
PREPAY_PENALTY_ AMT The penalty amount received 2 No commas(,) or dollar 11
when a borrower prepays on his signs ($)
loan as reported by the
Servicer.
--------------------------- -------------------------------- ------- -------------------------- ------
PREPAY_PENALTY_ WAIVED The prepayment penalty amount 2 No commas(,) or dollar 11
for the loan waived by the signs ($)
servicer.
--------------------------- -------------------------------- ------- -------------------------- ------
--------------------------- -------------------------------- ------- -------------------------- ------
MOD_DATE The Effective Payment Date of MM/DD/YYYY 10
the Modification for the loan.
--------------------------- -------------------------------- ------- -------------------------- ------
MOD_TYPE The Modification Type. Varchar - value can be 30
alpha or numeric
--------------------------- -------------------------------- ------- -------------------------- ------
DELINQ_P&I_ADVANCE_AMT The current outstanding 2 No commas(,) or dollar 11
principal and interest signs ($)
advances made by Servicer.
--------------------------- -------------------------------- ------- -------------------------- ------
EXH-10-2
Standard File Layout - Delinquency Reporting
-------------------------------------- -------------------------------------------------- --------- -------------
Column/Header Name Description Decimal Format
Comment
-------------------------------------- -------------------------------------------------- --------- -------------
SERVICER_LOAN_NBR A unique number assigned to a loan by the
Servicer. This may be different than the
LOAN_NBR
-------------------------------------- -------------------------------------------------- --------- -------------
LOAN_NBR A unique identifier assigned to each loan by the
originator.
-------------------------------------- -------------------------------------------------- --------- -------------
CLIENT_NBR Servicer Client Number
-------------------------------------- -------------------------------------------------- --------- -------------
SERV_INVESTOR_NBR Contains a unique number as assigned by
an external servicer to identify a
group of loans in their system.
-------------------------------------- -------------------------------------------------- --------- -------------
BORROWER_FIRST_NAME First Name of the Borrower.
-------------------------------------- -------------------------------------------------- --------- -------------
BORROWER_LAST_NAME Last name of the borrower.
-------------------------------------- -------------------------------------------------- --------- -------------
▇▇▇▇_▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Name and Number of Property
-------------------------------------- -------------------------------------------------- --------- -------------
PROP_STATE The state where the property located.
-------------------------------------- -------------------------------------------------- --------- -------------
PROP_ZIP Zip code where the property is located.
-------------------------------------- -------------------------------------------------- --------- -------------
BORR_NEXT_PAY_DUE_DATE The date that the borrower's next MM/DD/YYYY
payment is due to the servicer at
the end of processing cycle, as
reported by Servicer.
-------------------------------------- -------------------------------------------------- --------- -------------
LOAN_TYPE Loan Type (i.e. FHA, VA, Conv)
-------------------------------------- -------------------------------------------------- --------- -------------
BANKRUPTCY_FILED_DATE The date a particular bankruptcy claim was filed. MM/DD/YYYY
-------------------------------------- -------------------------------------------------- --------- -------------
BANKRUPTCY_CHAPTER_CODE The chapter under which the bankruptcy was filed.
-------------------------------------- -------------------------------------------------- --------- -------------
BANKRUPTCY_CASE_NBR The case number assigned by the court to the
bankruptcy filing.
-------------------------------------- -------------------------------------------------- --------- -------------
POST_PETITION_DUE_DATE The payment due date once the bankruptcy has MM/DD/YYYY
been approved by the courts
-------------------------------------- -------------------------------------------------- --------- -------------
BANKRUPTCY_DCHRG_DISM_DATE The Date The Loan Is Removed From Bankruptcy. MM/DD/YYYY
Either by Dismissal, Discharged and/or a Motion
For Relief Was Granted.
-------------------------------------- -------------------------------------------------- --------- -------------
LOSS_MIT_APPR_DATE The Date The Loss Mitigation Was Approved By The MM/DD/YYYY
Servicer
-------------------------------------- -------------------------------------------------- --------- -------------
LOSS_MIT_TYPE The Type Of Loss Mitigation Approved For A Loan
Such As;
-------------------------------------- -------------------------------------------------- --------- -------------
LOSS_MIT_EST_COMP_DATE The Date The Loss Mitigation /Plan Is Scheduled MM/DD/YYYY
To End/Close
-------------------------------------- -------------------------------------------------- --------- -------------
LOSS_MIT_ACT_COMP_DATE The Date The Loss Mitigation Is Actually MM/DD/YYYY
Completed
-------------------------------------- -------------------------------------------------- --------- -------------
FRCLSR_APPROVED_DATE The date DA Admin sends a letter to the MM/DD/YYYY
servicer with instructions to begin foreclosure
proceedings.
-------------------------------------- -------------------------------------------------- --------- -------------
ATTORNEY_REFERRAL_DATE Date File Was Referred To Attorney to Pursue MM/DD/YYYY
Foreclosure
-------------------------------------- -------------------------------------------------- --------- -------------
FIRST_LEGAL_DATE Notice of 1st legal filed by an Attorney in a MM/DD/YYYY
Foreclosure Action
-------------------------------------- -------------------------------------------------- --------- -------------
FRCLSR_SALE_EXPECTED_DATE The date by which a foreclosure sale is expected MM/DD/YYYY
to occur.
-------------------------------------- -------------------------------------------------- --------- -------------
FRCLSR_SALE_DATE The actual date of the foreclosure sale. MM/DD/YYYY
-------------------------------------- -------------------------------------------------- --------- -------------
FRCLSR_SALE_AMT The amount a property sold for at the 2 No commas(,)
or dollar
signs ($)
-------------------------------------- -------------------------------------------------- --------- -------------
EVICTION_START_DATE The date the servicer initiates eviction of the MM/DD/YYYY
borrower.
-------------------------------------- -------------------------------------------------- --------- -------------
EVICTION_COMPLETED_DATE The date the court revokes legal MM/DD/YYYY
possession of the property from the borrower.
-------------------------------------- -------------------------------------------------- --------- -------------
LIST_PRICE The price at which an REO property is marketed. 2 No commas(,)
or dollar
signs ($)
-------------------------------------- -------------------------------------------------- --------- -------------
LIST_DATE The date an REO property is listed at a MM/DD/YYYY
particular price.
-------------------------------------- -------------------------------------------------- --------- -------------
OFFER_AMT The dollar value of an offer for an REO property. 2 No commas(,)
or dollar
signs ($)
-------------------------------------- -------------------------------------------------- --------- -------------
OFFER_DATE_TIME The date an offer is received by DA Admin or by MM/DD/YYYY
the Servicer.
-------------------------------------- -------------------------------------------------- --------- -------------
REO_CLOSING_DATE The date the REO sale of the property is MM/DD/YYYY
scheduled to close.
-------------------------------------- -------------------------------------------------- --------- -------------
REO_ACTUAL_CLOSING_DATE Actual Date Of REO Sale MM/DD/YYYY
-------------------------------------- -------------------------------------------------- --------- -------------
EXH-10-3
-------------------------------------- -------------------------------------------------- --------- -------------
OCCUPANT_CODE Classification of how the property is occupied.
-------------------------------------- -------------------------------------------------- --------- -------------
PROP_CONDITION_CODE A code that indicates the condition of the
property.
-------------------------------------- -------------------------------------------------- --------- -------------
PROP_INSPECTION_DATE The date a property inspection is performed. MM/DD/YYYY
-------------------------------------- -------------------------------------------------- --------- -------------
APPRAISAL_DATE The date the appraisal was done. MM/DD/YYYY
-------------------------------------- -------------------------------------------------- --------- -------------
CURR_PROP_VAL The current "as is" value of the property based 2
on brokers price opinion or appraisal.
-------------------------------------- -------------------------------------------------- --------- -------------
REPAIRED_PROP_VAL The amount the property would be worth if 2
repairs are completed pursuant to a broker's
price opinion or appraisal.
-------------------------------------- -------------------------------------------------- --------- -------------
If applicable:
-------------------------------------- -------------------------------------------------- --------- -------------
DELINQ_STATUS_CODE FNMA Code Describing Status of Loan
-------------------------------------- -------------------------------------------------- --------- -------------
DELINQ_REASON_CODE The circumstances which caused a
borrower to stop paying on a loan. Code
indicates the reason why the loan is in
default for this cycle.
-------------------------------------- -------------------------------------------------- --------- -------------
MI_CLAIM_FILED_DATE Date Mortgage Insurance Claim Was Filed With MM/DD/YYYY
Mortgage Insurance Company.
-------------------------------------- -------------------------------------------------- --------- -------------
MI_CLAIM_AMT Amount of Mortgage Insurance Claim Filed No commas(,)
or dollar
signs ($)
-------------------------------------- -------------------------------------------------- --------- -------------
MI_CLAIM_PAID_DATE Date Mortgage Insurance Company Disbursed Claim MM/DD/YYYY
Payment
-------------------------------------- -------------------------------------------------- --------- -------------
MI_CLAIM_AMT_PAID Amount Mortgage Insurance Company Paid On Claim 2 No commas(,)
or dollar
signs ($)
-------------------------------------- -------------------------------------------------- --------- -------------
POOL_CLAIM_FILED_DATE Date Claim Was Filed With Pool Insurance Company MM/DD/YYYY
-------------------------------------- -------------------------------------------------- --------- -------------
POOL_CLAIM_AMT Amount of Claim Filed With Pool Insurance Company 2 No commas(,)
or dollar
signs ($)
-------------------------------------- -------------------------------------------------- --------- -------------
POOL_CLAIM_PAID_DATE Date Claim Was Settled and The Check Was Issued MM/DD/YYYY
By The Pool Insurer
-------------------------------------- -------------------------------------------------- --------- -------------
POOL_CLAIM_AMT_PAID Amount Paid On Claim By Pool Insurance Company 2 No commas(,)
or dollar
signs ($)
-------------------------------------- -------------------------------------------------- --------- -------------
FHA_PART_A_CLAIM_FILED_DATE Date FHA Part A Claim Was Filed With HUD MM/DD/YYYY
-------------------------------------- -------------------------------------------------- --------- -------------
FHA_PART_A_CLAIM_AMT Amount of FHA Part A Claim Filed 2 No commas(,)
or dollar
signs ($)
-------------------------------------- -------------------------------------------------- --------- -------------
FHA_PART_A_CLAIM_PAID_DATE Date HUD Disbursed Part A Claim Payment MM/DD/YYYY
-------------------------------------- -------------------------------------------------- --------- -------------
FHA_PART_A_CLAIM_PAID_AMT Amount HUD Paid on Part A Claim 2 No commas(,)
or dollar
signs ($)
-------------------------------------- -------------------------------------------------- --------- -------------
FHA_PART_B_CLAIM_FILED_DATE Date FHA Part B Claim Was Filed With HUD MM/DD/YYYY
-------------------------------------- -------------------------------------------------- --------- -------------
FHA_PART_B_CLAIM_AMT Amount of FHA Part B Claim Filed 2 No commas(,)
or dollar
signs ($)
-------------------------------------- -------------------------------------------------- --------- -------------
FHA_PART_B_CLAIM_PAID_DATE Date HUD Disbursed Part B Claim Payment MM/DD/YYYY
-------------------------------------- -------------------------------------------------- --------- -------------
FHA_PART_B_CLAIM_PAID_AMT Amount HUD Paid on Part B Claim 2 No commas(,)
or dollar
signs ($)
-------------------------------------- -------------------------------------------------- --------- -------------
VA_CLAIM_FILED_DATE Date VA Claim Was Filed With the Veterans Admin MM/DD/YYYY
-------------------------------------- -------------------------------------------------- --------- -------------
VA_CLAIM_PAID_DATE Date Veterans Admin. Disbursed VA Claim Payment MM/DD/YYYY
-------------------------------------- -------------------------------------------------- --------- -------------
VA_CLAIM_PAID_AMT Amount Veterans Admin. Paid on VA Claim 2 No commas(,)
or dollar
signs ($)
-------------------------------------- -------------------------------------------------- --------- -------------
EXH-10-4
Standard File Codes - Delinquency Reporting
The Loss Mit Type field should show the approved Loss Mitigation Code as
follows:
o ASUM- Approved Assumption
o BAP- Borrower Assistance Program
o CO- Charge Off
o DIL- Deed-in-Lieu
o FFA- Formal Forbearance Agreement
o MOD- Loan Modification
o PRE- Pre-Sale
o SS- Short Sale
o MISC- Anything else approved by the PMI or Pool Insurer
NOTE: ▇▇▇▇▇ Fargo Bank will accept alternative Loss Mitigation Types to those
above, provided that they are consistent with industry standards. If Loss
Mitigation Types other than those above are used, the Servicer must supply
▇▇▇▇▇ Fargo Bank with a description of each of the Loss Mitigation Types prior
to sending the file.
The Occupant Code field should show the current status of the property code
as follows:
o Mortgagor
o Tenant
o Unknown
o Vacant
The Property Condition field should show the last reported condition of the
property as follows:
o Damaged
o Excellent
o Fair
o Gone
o Good
o Poor
o Special Hazard
o Unknown
EXH-10-5
Standard File Codes - Delinquency Reporting, Continued
The FNMA Delinquent Reason Code field should show the Reason for Delinquency
as follows:
--------------------------------------------------------
Delinquency Code Delinquency Description
--------------------------------------------------------
001 FNMA-Death of principal mortgagor
--------------------------------------------------------
002 FNMA-Illness of principal mortgagor
--------------------------------------------------------
003 FNMA-Illness of mortgagor's family
member
--------------------------------------------------------
004 FNMA-Death of mortgagor's family
member
--------------------------------------------------------
005 FNMA-Marital difficulties
--------------------------------------------------------
006 FNMA-Curtailment of income
--------------------------------------------------------
007 FNMA-Excessive Obligation
--------------------------------------------------------
008 FNMA-Abandonment of property
--------------------------------------------------------
009 FNMA-Distant employee transfer
--------------------------------------------------------
011 FNMA-Property problem
--------------------------------------------------------
012 FNMA-Inability to sell property
--------------------------------------------------------
013 FNMA-Inability to rent property
--------------------------------------------------------
014 FNMA-Military Service
--------------------------------------------------------
015 FNMA-Other
--------------------------------------------------------
016 FNMA-Unemployment
--------------------------------------------------------
017 FNMA-Business failure
--------------------------------------------------------
019 FNMA-Casualty loss
--------------------------------------------------------
022 FNMA-Energy environment costs
--------------------------------------------------------
023 FNMA-Servicing problems
--------------------------------------------------------
026 FNMA-Payment adjustment
--------------------------------------------------------
027 FNMA-Payment dispute
--------------------------------------------------------
029 FNMA-Transfer of ownership pending
--------------------------------------------------------
030 FNMA-Fraud
--------------------------------------------------------
031 FNMA-Unable to contact borrower
--------------------------------------------------------
INC FNMA-Incarceration
--------------------------------------------------------
EXH-10-6
Standard File Codes - Delinquency Reporting, Continued
The FNMA Delinquent Status Code field should show the Status of Default as
follows:
-------------------------------------------------------
Status Code Status Description
-------------------------------------------------------
09 Forbearance
-------------------------------------------------------
17 Pre-foreclosure Sale Closing Plan
Accepted
-------------------------------------------------------
24 Government Seizure
-------------------------------------------------------
26 Refinance
-------------------------------------------------------
27 Assumption
-------------------------------------------------------
28 Modification
-------------------------------------------------------
29 Charge-Off
-------------------------------------------------------
30 Third Party Sale
-------------------------------------------------------
31 Probate
-------------------------------------------------------
32 Military Indulgence
-------------------------------------------------------
43 Foreclosure Started
-------------------------------------------------------
44 Deed-in-Lieu Started
-------------------------------------------------------
49 Assignment Completed
-------------------------------------------------------
61 Second Lien Considerations
-------------------------------------------------------
62 Veteran's Affairs-No Bid
-------------------------------------------------------
63 Veteran's Affairs-Refund
-------------------------------------------------------
64 Veteran's Affairs-Buydown
-------------------------------------------------------
65 Chapter 7 Bankruptcy
-------------------------------------------------------
66 Chapter 11 Bankruptcy
-------------------------------------------------------
67 Chapter 13 Bankruptcy
-------------------------------------------------------
EXH-10-7
EXHIBIT 10
FORM OF SELLER'S OFFICER'S CERTIFICATE
I, ____________________, hereby certify that I am the duly elected
[Vice] President of ________________ [COMPANY], a [state] [federally]
chartered institution organized under the laws of the [state of ____________]
[United States] (the "Company") and further as follows:
1. Attached hereto as Exhibit 1 is a true, correct and complete
copy of the charter of the Company which is in full force and effect on
the date hereof and which has been in effect without amendment, waiver,
rescission or modification since ___________.
2. Attached hereto as Exhibit 2 is a true, correct and complete
copy of the bylaws of the Company which are in effect on the date hereof
and which have been in effect without amendment, waiver, rescission or
modification since ___________.
3. Attached hereto as Exhibit 3 is an original certificate of good
standing of the Company issued within ten days of the date hereof, and no
event has occurred since the date thereof which would impair such
standing.
4. Attached hereto as Exhibit 4 is a true, correct and complete
copy of the corporate resolutions of the Board of Directors of the
Company authorizing the Company to execute and deliver each of the
Mortgage Loan Sale and Servicing Agreement, dated as of January 1, 2006,
by and between ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. (the "Purchaser"),
the Company and the servicer (the "Sale and Servicing Agreement") and the
Custodial Agreement, dated as of January 1, 2006, by and among the
Company, the Purchaser and ▇.▇. ▇▇▇▇▇▇ Trust Company, National Association
(the "Custodial Agreement") [and to endorse the Mortgage Notes and execute
the Assignments of Mortgages by original [or facsimile] signature], and
such resolutions are in effect on the date hereof and have been in effect
without amendment, waiver, rescission or modification since ____________.
5. Either (i) no consent, approval, authorization or order of any
court or governmental agency or body is required for the execution,
delivery and performance by the Company of or compliance by the Company
with the Sale and Servicing Agreement, the Custodial Agreement, the sale
of the mortgage loans or the consummation of the transactions
contemplated by the agreements; or (ii) any required consent, approval,
authorization or order has been obtained by the Company.
6. Neither the consummation of the transactions contemplated by,
nor the fulfillment of the terms of the Sale and Servicing Agreement and
the Custodial Agreement conflicts or will conflict with or results or
will result in a breach of or constitutes or will constitute a default
under the charter or by-laws of the Company, or, to the best of my
knowledge, the terms of any indenture or other agreement or instrument to
which the Company is a party or by which it is bound or to which it is
subject, or any
EXH-10-1
statute or order, rule, regulations, writ, injunction or decree of any
court, governmental authority or regulatory body to which the Company is
subject or by which it is bound.
7. To the best of my knowledge, there is no action, suit,
proceeding or investigation pending or threatened against the Company
which, in my judgment, either in any one instance or in the aggregate,
may result in any material adverse change in the business, operations,
financial condition, properties or assets of the Company or in any
material impairment of the right or ability of the Company to carry on
its business substantially as now conducted or in any material liability
on the part of the Company or which would draw into question the validity
of the Sale and Servicing Agreement and the Custodial Agreement, or the
mortgage loans or of any action taken or to be taken in connection with
the transactions contemplated hereby, or which would be likely to impair
materially the ability of the Company to perform under the terms of the
Sale and Servicing Agreement and the Custodial Agreement.
8. Each person listed on Exhibit 5 attached hereto who, as an
officer or representative of the Company, signed (a) the Sale and
Servicing Agreement, (b) the Custodial Agreement and (c) any other
document delivered or on the date hereof in connection with any purchase
described in the agreements set forth above was, at the respective times
of such signing and delivery, and is now, a duly elected or appointed,
qualified and acting officer or representative of the Company, who holds
the office set forth opposite his or her name on Exhibit 5, and the
signatures of such persons appearing on such documents are their genuine
signatures.
9. The Company is duly authorized to engage in the transactions
described and contemplated in the Sale and Servicing Agreement and the
Custodial Agreement.
EXH-10-2
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the
seal of the Company.
Dated: ____________________________
By: ____________________________
Name: ____________________________
[Seal] Title: [Vice] President
I, ________________________, an [Assistant] Secretary of
______________[COMPANY], hereby certify that ____________ is the duly elected,
qualified and acting [Vice] President of the Company and that the signature
appearing above is [her] [his] genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated: ____________________________
By: ____________________________
Name: ____________________________
Title: ____________________________
[Assistant] Secretary
EXH-10-3
EXHIBIT 5 to
Company's Officer's Certificate
NAME TITLE SIGNATURE
-------------------- -------------------- --------------------
-------------------- -------------------- --------------------
-------------------- -------------------- --------------------
-------------------- -------------------- --------------------
-------------------- -------------------- --------------------
-------------------- -------------------- --------------------
-------------------- -------------------- --------------------
-------------------- -------------------- --------------------
EXH-10-4
EXHIBIT 11
FORM OF OPINION OF COUNSEL TO SELLER
(date)
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
You have requested [our] [my] opinion, as [Assistant] General
Counsel to ___________________ (the "Company"), with respect to certain
matters in connection with the sale by the Company of the Mortgage Loans
pursuant to that certain Mortgage Loan Sale and Servicing Agreement, by and
between the Company, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. (the "Purchaser")
and the servicer, dated as of January 1, 2006 (the "Sale and Servicing
Agreement") which sale is in the form of whole loans, delivered pursuant to a
Custodial Agreement dated as of January 1, 2006 among the Purchaser, the
Company, and ▇.▇. ▇▇▇▇▇▇ Trust Company, National Association (the "Custodial
Agreement" and, collectively with the Sale and Servicing Agreement, the
"Agreements"). Capitalized terms not otherwise defined herein have the
meanings set forth in the Sale and Servicing Agreement.
[We] [I] have examined the following documents:
1. the Sale and Servicing Agreement;
2. the Custodial Agreement;
3. the form of Assignment of Mortgage;
4. the form of endorsement of the Mortgage Notes; and
5. such other documents, records and papers as we have deemed
necessary and relevant as a basis for this opinion.
To the extent [we] [I] have deemed necessary and proper, [we] [I]
have relied upon the representations and warranties of the Company contained
in the Sale and Servicing Agreement. [We] [I] have assumed the authenticity of
all documents submitted to [us] [me] as originals, the genuineness of all
signatures, the legal capacity of natural persons and the conformity to the
originals of all documents.
EXH-11-1
Based upon the foregoing, it is [our] [my] opinion that:
1. The Company is a [type of entity] duly organized, validly
existing and in good standing under the laws of the [United States] and is
qualified to transact business in, and is in good standing under, the laws of
[the state of incorporation].
2. The Company has the power to engage in the transactions
contemplated by the Agreements and all requisite power, authority and legal
right to execute and deliver the Agreements and to perform and observe the
terms and conditions of the Agreements.
3. Each of the Agreements has been duly authorized, executed and
delivered by the Company, and is a legal, valid and binding agreement
enforceable in accordance with its respective terms against the Company,
subject to bankruptcy laws and other similar laws of general application
affecting rights of creditors and subject to the application of the rules of
equity, including those respecting the availability of specific performance,
none of which will materially interfere with the realization of the benefits
provided thereunder or with the Purchaser's ownership of the Mortgage Loans.
4. The Company has been duly authorized to allow any of its
officers to execute any and all documents by original signature in order to
complete the transactions contemplated by the Agreements.
5. The Company has been duly authorized to allow any of its
officers to execute by original [or facsimile] signature the endorsements to
the Mortgage Notes and the Assignments of Mortgages, and the original [or
facsimile] signature of the officer at the Company executing the endorsements
to the Mortgage Notes and the Assignments of Mortgages represents the legal
and valid signature of said officer of the Company.
6. Either (i) no consent, approval, authorization or order of any
court or governmental agency or body is required for the execution, delivery
and performance by the Company of or compliance by the Company with the
Agreements and the sale of the Mortgage Loans by the Company or the
consummation of the transactions contemplated by the Agreements or (ii) any
required consent, approval, authorization or order has been obtained by the
Company.
7. Neither the consummation of the transactions contemplated by,
nor the fulfillment of the terms of, the Agreements conflict or will conflict
with or results or will result in a breach of or constitute or will constitute
a default under the charter or by-laws of the Company or, to the best of my
knowledge, the material terms of any indenture or other agreement or
instrument to which the Company is a party or by which it is bound or to which
it is subject, or violates any statute or order, rule, regulations, writ,
injunction or decree of any court, governmental authority or regulatory body
to which the Company is subject or by which it is bound.
8. There is no action, suit, proceeding or investigation pending
or, to the best of [our] [my] knowledge, threatened against the Company which,
in [our] [my] judgment, either in any one instance or in the aggregate, may
result in any material adverse change in the business, operations, financial
condition, properties or assets of the Company or in any material
EXH-11-2
impairment of the right or ability of the Company to carry on its business
substantially as now conducted or in any material liability on the part of the
Company or which would draw into question the validity of the Agreements or
the Mortgage Loans or of any action taken or to be taken in connection with
the transactions contemplated thereby, or which would be likely to impair
materially the ability of the Company to perform under the terms of the
Agreements.
9. The sale of each Mortgage Note and Mortgage as and in the
manner contemplated by the Agreements is sufficient to fully transfer to the
Purchaser all right, title and interest of the Company thereto as noteholder
and mortgagee.
10. The Mortgages have been duly assigned and the Mortgage Notes
have been duly endorsed as provided in the Custodial Agreement. The
Assignments of Mortgage are in recordable form, except for the insertion of
the name of the assignee, and upon the name of the assignee being inserted,
are acceptable for recording under the laws of the state where each related
Mortgaged Property is located. The endorsement of the Mortgage Notes, the
delivery to the Purchaser, or its designee, of the Assignments of Mortgage,
and the delivery of the original endorsed Mortgage Notes to the Purchaser, or
its designee, are sufficient to permit the Purchaser to avail itself of all
protection available under applicable law against the claims of any present or
future creditors of the Company, and are sufficient to prevent any other sale,
transfer, assignment, pledge or hypothecation of the Mortgages and the
Mortgage Notes by the Company from being enforceable.
Except as otherwise set forth in the Agreements, I assume no
obligation to revise this opinion or alter its conclusions to update or
support this letter to reflect any facts or circumstances that may hereafter
develop.
This opinion is given to you for your sole benefit, and no other
person or entity is entitled to rely hereon except that the purchaser or
purchasers to which you initially and directly resell the Mortgage Loans may
rely on this opinion as if it were addressed to them as of the date of this
opinion.
Very truly yours,
____________________________________
[Name]
____________________________________
[Assistant] General Counsel
EXH-11-3
EXHIBIT 12
FORM OF SECURITY RELEASE CERTIFICATION
-------------------, -----
_________________________
_________________________
_________________________
Attention: ___________________________
___________________________
Re: Notice of Sale and Release of Collateral
Dear Sirs:
This letter serves as notice that [COMPANY] a corporation
organized pursuant to the laws of the state of [___________] (the "Company")
has committed to sell to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. under a Mortgage
Loan Sale and Servicing Agreement, dated as of January 1, 2006, certain
mortgage loans originated by the Company. The Company warrants that the
mortgage loans to be sold to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. are in
addition to and beyond any collateral required to secure advances made by you
to the Company.
The Company acknowledges that the mortgage loans to be sold to
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. shall not be used as additional or
substitute collateral for advances made by [____________]. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Mortgage Capital Inc. understands that the balance of the Company's mortgage
loan portfolio may be used as collateral or additional collateral for advances
made by [___________], and confirms that it has no interest therein.
EXH-12-1
Execution of this letter by [___________] shall constitute a full
and complete release of any security interest, claim, or lien which
[___________] may have against the mortgage loans to be sold to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Mortgage Capital Inc.
Very truly yours,
_______________________________________
By:____________________________________
Name:__________________________________
Title:_________________________________
Date:__________________________________
Acknowledged and approved:
___________________________
By:____________________________________
Name:__________________________________
Title:_________________________________
Date:__________________________________
EXH-12-2
EXHIBIT 13
FORM OF SECURITY RELEASE CERTIFICATION
I. Release of Security Interest
The financial institution named below hereby relinquishes any and
all right, title, interest, lien or claim of any kind it may have in all
mortgage loans described on the attached Schedule A (the "Mortgage Loans") to
be purchased by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. from the company named on
the next page pursuant to that certain Mortgage Loan Sale and Servicing
Agreement, dated as of January 1, 2006 and certifies that all notes,
mortgages, assignments and other documents in its possession relating to such
Mortgage Loans have been delivered and released to the Company or its
designees, as of the date and time of the sale of such Mortgage Loans to
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. Such release shall be effective
automatically without any further action by any party upon payment in one or
more installments, in immediately available funds, of $_____________, in
accordance with the wire instructions set forth below.
Name, Address and Wire Instructions of Financial Institution
________________________________
(Name)
________________________________
(Address)
________________________________
________________________________
________________________________
By:_____________________________
EXH-13-1
II. Certification of Release
The Company named below hereby certifies to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Mortgage Capital Inc. that, as of the date and time of the sale of the
above-mentioned Mortgage Loans to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. the
security interests in the Mortgage Loans released by the above-named financial
institution comprise all security interests relating to or affecting any and
all such Mortgage Loans. The Company warrants that, as of such time, there are
and will be no other security interests affecting any or all of such Mortgage
Loans.
______________________________
By:___________________________
Title:________________________
Date:_________________________
EXH-13-2
EXHIBIT 14
FORM OF ASSIGNMENT AND CONVEYANCE
On this ___ day of __________, ____, ___________________
("Seller"), as (i) the Seller under that certain Purchase Price and Terms
Agreement, dated as of ___________, _____ (the "PPTA"), (ii) the Seller under
that certain Mortgage Loan Sale and Servicing Agreement, dated as of January
1, 2006 (the "Sale and Servicing Agreement") and, together with the PPTA, the
"Agreements") does hereby sell, transfer, assign, set over and convey to
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. ("Purchaser") as the Purchaser under the
Agreements, without recourse, but subject to the terms of the Agreements, all
right, title and interest of, in and to the Mortgage Loans listed on the
Mortgage Loan Schedule attached hereto as Exhibit A (the "Mortgage Loans"),
together with the Mortgage Files and all rights and obligations arising under
the documents contained therein. Each Mortgage Loan subject to the Agreements
was underwritten in accordance with, and conforms to, the Underwriting
Guidelines attached hereto as Exhibit C. Pursuant to Section 6 of the Sale and
Servicing Agreement, the Seller has delivered to the Custodian the documents
for each Mortgage Loan to be purchased as set forth in the Custodial
Agreement. The contents of each Servicing File required to be retained by the
Servicer to service the Mortgage Loans pursuant to the Sale and Servicing
Agreement and thus not delivered to the Purchaser are and shall be held in
trust by the Servicer in its capacity as Servicer for the benefit of the
Purchaser as the owner thereof. The Servicer's possession of any portion of
the Servicing File is at the will of the Purchaser for the sole purpose of
facilitating servicing of the related Mortgage Loan pursuant to the Sale and
Servicing 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 Mortgage File and Servicing File is vested in the
Purchaser and the ownership of all records and documents with respect to the
related Mortgage Loan prepared by or which come into the possession of the
Seller or the Servicer shall immediately vest in the Purchaser and shall be
retained and maintained, in trust, by the Servicer at the will of the
Purchaser in such custodial capacity only.
The Mortgage Loan Package characteristics of the Mortgage Loans
subject hereto are set forth on Exhibit B hereto.
In accordance with Section 6 of the Sale and Servicing Agreement,
the Purchaser accepts the Mortgage Loans listed on Exhibit A attached hereto.
Notwithstanding the foregoing the Purchaser does not waive any rights or
remedies it may have under the Agreements.
Capitalized terms used herein and not otherwise defined shall have
the meanings set forth in the Sale and Servicing Agreement.
[Signature Page Follows]
EXH-14-1
[SELLER]
By:____________________________________
Name:
Title:
Accepted and Agreed:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ MORTGAGE CAPITAL INC.
By:__________________________
Name:
Title:
EXH-14-2
EXHIBIT A
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
THE MORTGAGE LOANS
EXH-14-3
EXHIBIT B
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE POOL CHARACTERISTICS OF
EACH MORTGAGE LOAN PACKAGE
Pool Characteristics of the Mortgage Loan Package as delivered on
the related Closing Date:
No Mortgage Loan has: (1) an outstanding principal balance less
than $_________; (2) an origination date earlier than _ months prior to the
related Cut-off Date; (3) a CLTV of greater than _____%; (4) a FICO Score of
less than ___; or (5) a debt-to-income ratio of more than __%. Each Mortgage
Loan has a Mortgage Interest Rate of at least ___% per annum and an
outstanding principal balance of less than $_________. Each Adjustable Rate
Mortgage Loan has an Index of [_______].
EXH-14-4
EXHIBIT C
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
UNDERWRITING GUIDELINES
EXH-14-5
EXHIBIT 15
FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated [____________ __,
20__] ("Agreement"), among ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc. ("Assignor"),
[____________________] ("Assignee") and [SELLER] (the "Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and
other valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
-------------------------
1. The Assignor hereby conveys, sells, grants, transfers and
assigns to the Assignee all of the right, title and interest of the Assignor,
as purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain Mortgage
Loan Sale and Servicing Agreement (the "Sale and Servicing Agreement"), dated
as of [DATE], between the Assignor, as purchaser (the "Purchaser"), and the
Company, as seller, solely insofar as the Sale and Servicing Agreement relates
to the Mortgage Loans.
The Assignor specifically reserves and does not assign to the
Assignee hereunder any and all right, title and interest in, to and under and
any obligations of the Assignor with respect to (a) Subsection 7.05 of the
Sale and Servicing Agreement or (b) any mortgage loans subject to the Sale and
Servicing Agreement which are not the Mortgage Loans set forth on the Mortgage
Loan Schedule and are not the subject of this Agreement.
Recognition of the Company
--------------------------
2. From and after the date hereof (the "Securitization Closing
Date"), the Company shall and does hereby recognize that the Assignee will
transfer the Mortgage Loans and assign its rights under the Sale and Servicing
Agreement (solely to the extent set forth herein) and this Agreement to
[__________________] (the "Trust") created pursuant to a Pooling and Servicing
Agreement, dated as of [__________, 200_] (the "Pooling Agreement"), among the
Assignee, the Assignor, [___________________], as trustee (including its
successors in interest and any successor trustees under the Pooling Agreement,
the "Trustee"), [____________________], as servicer (including its successors
in interest and any successor servicer under the Pooling Agreement, the
"Servicer"). The Company hereby acknowledges and agrees that from and after
the date hereof (i) the Trust will be the owner of the Mortgage Loans, (ii)
the Company shall look solely to the Trust for performance of any obligations
of the Assignor insofar as they relate to the Mortgage Loans, (iii) the Trust
(including the Trustee and the Servicer acting on the Trust's behalf) shall
have all the rights and remedies available to the Assignor, insofar as they
relate to the Mortgage Loans, under the Sale and Servicing Agreement,
including, without limitation, the enforcement of the document delivery
requirements set forth in Section 6 of the Sale and Servicing Agreement, and
shall be entitled to enforce all of the obligations of the Company thereunder
insofar as they relate to the Mortgage Loans, and (iv) all
EXH-15-1
references to the Purchaser, the Custodian or the Bailee under the Sale and
Servicing Agreement insofar as they relate to the Mortgage Loans, shall be
deemed to refer to the Trust (including the Trustee and the Servicer acting on
the Trust's behalf). Neither the Company nor the Assignor shall amend or agree
to amend, modify, waiver, or otherwise alter any of the terms or provisions of
the Sale and Servicing Agreement which amendment, modification, waiver or
other alteration would in any way affect the Mortgage Loans or the Company's
performance under the Sale and Servicing Agreement with respect to the
Mortgage Loans without the prior written consent of the Trustee.
Representations and Warranties of the Company
---------------------------------------------
3. The Company warrants and represents to the Assignor, the
Assignee and the Trust as of the date hereof that:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver
and perform its obligations under this Agreement and has full power and
authority to perform its obligations under the Sale and Servicing
Agreement. The execution by the Company of this Agreement is in the
ordinary course of the Company's business and will not conflict with, or
result in a breach of, any of the terms, conditions or provisions of the
Company's charter or bylaws or any legal restriction, or any material
agreement or instrument to which the Company is now a party or by which
it is bound, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Company or its property is
subject. The execution, delivery and performance by the Company of this
Agreement have been duly authorized by all necessary corporate action on
part of the Company. This Agreement has been duly executed and delivered
by the Company, and, upon the due authorization, execution and delivery
by the Assignor and the Assignee, will constitute the valid and legally
binding obligation of the Company, enforceable against the Company in
accordance with its terms except as enforceability may be limited by
bankruptcy, reorganization, insolvency, moratorium or other similar laws
now or hereafter in effect relating to creditors' rights generally, and
by general principles of equity regardless of whether enforceability is
considered in a proceeding in equity or at law;
(c) No consent, approval, order or authorization of, or
declaration, filing or registration with, any governmental entity is
required to be obtained or made by the Company in connection with the
execution, delivery or performance by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation pending
or threatened against the Company, before any court, administrative
agency or other tribunal, which would draw into question the validity of
this Agreement or the Sale and Servicing Agreement, or which, either in
any one instance or in the aggregate, would result in any material
adverse change in the ability of the Company to perform its obligations
under this Agreement or the Sale and Servicing Agreement, and the Company
is solvent.
EXH-15-2
4. Pursuant to Section 15 of the Sale and Servicing Agreement,
the Company hereby represents and warrants, for the benefit of the Assignor,
the Assignee and the Trust, that the representations and warranties set forth
in Section 7.01 and Section 7.02 of the Sale and Servicing Agreement are true
and correct as of the date hereof as if such representations and warranties
were made on the date hereof unless otherwise specifically stated in such
representations and warranties.
Remedies for Breach of Representations and Warranties
-----------------------------------------------------
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee
and the Servicer acting on the Trust's behalf) in connection with any breach
of the representations and warranties made by the Company set forth in
Sections 3 and 4 hereof shall be as set forth in Subsection 7.03 of the Sale
and Servicing Agreement as if they were set forth herein (including without
limitation the repurchase and indemnity obligations set forth therein).
Miscellaneous
-------------
6. This Agreement shall be construed in accordance with the
laws of the State of New York, without regard to conflicts of law principles,
and the obligations, rights and remedies of the parties hereunder shall be
determined in accordance with such laws.
7. 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, with
the prior written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the
successors and assigns of the parties hereto and (ii) the Trust (including the
Trustee and the Servicer acting on the Trust's behalf). Any entity into which
Assignor, Assignee or Company may be merged or consolidated shall, without the
requirement for any further writing, be deemed Assignor, Assignee or Company,
respectively, hereunder.
9. Each of this Agreement and the Sale and Servicing Agreement
shall survive the conveyance of the Mortgage Loans and the assignment of the
Sale and Servicing Agreement (to the extent assigned hereunder) by Assignor to
Assignee and by Assignee to the Trust and nothing contained herein shall
supersede or amend the terms of the Sale and Servicing Agreement.
10. 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.
11. In the event that any provision of this Agreement conflicts
with any provision of the Sale and Servicing Agreement with respect to the
Mortgage Loans, the terms of this Agreement shall control.
EXH-15-3
12. Capitalized terms used in this Agreement (including the
exhibits hereto) but not defined in this Agreement shall have the meanings
given to such terms in the Sale and Servicing Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
[SELLER]
By:
Name:_______________________________
Its:________________________________
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ MORTGAGE CAPITAL INC.
By:
Name:_______________________________
Its:________________________________
[ASSIGNEE]
By:
Name:_______________________________
Its:________________________________
EXH-15-4
EXHIBIT 16
FORM OF ANNUAL CERTIFICATION
Re: The [ ] agreement dated as of [ ], 200[ ] (the "Agreement"),
among [IDENTIFY PARTIES]
I, ________________________________, the _______________________
of [NAME OF COMPANY], certify to [the Purchaser], [the Depositor], and the
[Master Servicer] [Securities Administrator] [Trustee], and their officers,
with the knowledge and intent that they will rely upon this certification,
that:
1. I have reviewed the servicer compliance statement of the
Company provided in accordance with Item 1123 of Regulation AB (the
"Compliance Statement"), the report on assessment of the Company's
compliance with the servicing criteria set forth in Item 1122(d) of
Regulation AB (the "Servicing Criteria"), provided in accordance with
Rules 13a-18 and 15d-18 under Securities Exchange Act of 1934, as amended
(the "Exchange Act") and Item 1122 of Regulation AB (the "Servicing
Assessment"), the registered public accounting firm's attestation report
provided in accordance with Rules 13a-18 and 15d-18 under the Exchange
Act and Section 1122(b) of Regulation AB (the "Attestation Report"), and
all servicing reports, officer's certificates and other information
relating to the servicing of the Mortgage Loans by the Company during
200[ ] that were delivered by the Company to the [Depositor] [Master
Servicer] [Securities Administrator] [Trustee] pursuant to the Agreement
(collectively, the "Company Servicing Information");
2. Based on my knowledge, the Company Servicing Information, taken
as a whole, does not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements made, in
the light of the circumstances under which such statements were made, not
misleading with respect to the period of time covered by the Company
Servicing Information;
3. Based on my knowledge, all of the Company Servicing Information
required to be provided by the Company under the Agreement has been
provided to the [Depositor] [Master Servicer] [Securities Administrator]
[Trustee];
4. I am responsible for reviewing the activities performed by the
Company as servicer under the Agreement, and based on my knowledge and
the compliance review conducted in preparing the Compliance Statement and
except as disclosed in the Compliance Statement, the Servicing Assessment
or the Attestation Report, the Company has fulfilled its obligations
under the Agreement in all material respects; and
5. The Compliance Statement required to be delivered by the
Company pursuant to the Agreement, and the Servicing Assessment and
Attestation Report required to be provided by the Company and by any
Subservicer or Subcontractor pursuant to the Agreement, have been
provided to the [Depositor] [Master Servicer]. Any material instances of
noncompliance described in such reports have been disclosed to the
EXH-16-1
[Depositor] [Master Servicer]. Any material instance of noncompliance
with the Servicing Criteria has been disclosed in such reports.
Date:__________________________________
By:____________________________________
Name:
Title:
EXH-16-2
EXHIBIT 17
SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The assessment of compliance to be delivered by [the SELLER] [Name
of Subservicer] shall address, at a minimum, the criteria identified as below
as "Applicable Servicing Criteria":
-------------------- ------------------------------------------------------- --------------------
Applicable
Servicing Criteria Servicing Criteria
-------------------- ------------------------------------------------------- --------------------
Reference Criteria
-------------------- ------------------------------------------------------- --------------------
General Servicing Considerations
-------------------- ------------------------------------------------------- --------------------
1122(d)(1)(i) Policies and procedures are instituted to monitor any X
performance or other triggers and events of default
in accordance with the transaction agreements.
-------------------- ------------------------------------------------------- --------------------
1122(d)(1)(ii) If any material servicing activities are outsourced X
to third parties, policies and procedures are
instituted to monitor the third party's performance
and compliance with such servicing activities.
-------------------- ------------------------------------------------------- --------------------
1122(d)(1)(iii) Any requirements in the transaction agreements to
maintain a back-up servicer for the mortgage loans are
maintained.
-------------------- ------------------------------------------------------- --------------------
1122(d)(1)(iv) A fidelity bond and errors and omissions policy is in X
effect on the party participating in the servicing
function throughout the reporting period in the
amount of coverage required by and otherwise in
accordance with the terms of the transaction
agreements.
-------------------- ------------------------------------------------------- --------------------
Cash Collection and Administration
-------------------- ------------------------------------------------------- --------------------
1122(d)(2)(i) Payments on mortgage loans are deposited into the X
appropriate custodial bank accounts and related bank
clearing accounts no more than two business days
following receipt, or such other number of days
specified in the transaction agreements.
-------------------- ------------------------------------------------------- --------------------
1122(d)(2)(ii) Disbursements made via wire transfer on behalf of an X
obligor or to an investor are made only by authorized
personnel.
-------------------- ------------------------------------------------------- --------------------
1122(d)(2)(iii) Advances of funds or guarantees regarding X
collections, cash flows or distributions, and any
interest or other fees charged for such advances, are
made, reviewed and approved as specified in the
transaction agreements.
-------------------- ------------------------------------------------------- --------------------
-------------------- ------------------------------------------------------- --------------------
Applicable
Servicing Criteria Servicing Criteria
-------------------- ------------------------------------------------------- --------------------
Reference Criteria
-------------------- ------------------------------------------------------- --------------------
1122(d)(2)(iv) The related accounts for the transaction, such as X
cash reserve accounts or accounts established as a
form of overcollateralization, are separately
maintained (e.g., with respect to commingling of
cash) as set forth in the transaction agreements.
-------------------- ------------------------------------------------------- --------------------
1122(d)(2)(v) Each custodial account is maintained at a federally X
insured depository institution as set forth in the
transaction agreements. For purposes of this
criterion, "federally insured depository institution"
with respect to a foreign financial institution means
a foreign financial institution that meets the
requirements of Rule 13k-1(b)(1) of the Securities
Exchange Act.
-------------------- ------------------------------------------------------- --------------------
1122(d)(2)(vi) Unissued checks are safeguarded so as to prevent X
unauthorized access.
-------------------- ------------------------------------------------------- --------------------
1122(d)(2)(vii) Reconciliations are prepared on a monthly basis for X
all asset-backed securities related bank accounts,
including custodial accounts and related bank
clearing accounts. These reconciliations are (A)
mathematically accurate; (B) prepared within 30
calendar days after the bank statement cutoff date,
or such other number of days specified in the
transaction agreements; (C) reviewed and approved by
someone other than the person who prepared the
reconciliation; and (D) contain explanations for
reconciling items. These reconciling items are
resolved within 90 calendar days of their original
identification, or such other number of days
specified in the transaction agreements.
-------------------- ------------------------------------------------------- --------------------
Investor Remittances and Reporting
-------------------- ------------------------------------------------------- --------------------
1122(d)(3)(i) Reports to investors, including those to be filed X
with the Commission, are maintained in accordance
with the transaction agreements and applicable
Commission requirements. Specifically, such reports
(A) are prepared in accordance with timeframes and
other terms set forth in the transaction agreements;
(B) provide information calculated in accordance with
the terms specified in the transaction agreements;
(C) are filed with the Commission as required by its
rules and regulations; and (D) agree with investors'
or the trustee's records as to the total unpaid
principal balance and number of mortgage loans
serviced by the Servicer.
-------------------- ------------------------------------------------------- --------------------
EXH-17-2
-------------------- ------------------------------------------------------- --------------------
Applicable
Servicing Criteria Servicing Criteria
-------------------- ------------------------------------------------------- --------------------
Reference Criteria
-------------------- ------------------------------------------------------- --------------------
1122(d)(3)(ii) Amounts due to investors are allocated and remitted X
in accordance with timeframes, distribution priority
and other terms set forth in the transaction
agreements.
-------------------- ------------------------------------------------------- --------------------
1122(d)(3)(iii) Disbursements made to an investor are posted within X
two business days to the Servicer's investor records,
or such other number of days specified in the
transaction agreements.
-------------------- ------------------------------------------------------- --------------------
1122(d)(3)(iv) Amounts remitted to investors per the investor X
reports agree with cancelled checks, or other form of
payment, or custodial bank statements.
-------------------- ------------------------------------------------------- --------------------
Pool Asset Administration
-------------------- ------------------------------------------------------- --------------------
1122(d)(4)(i) Collateral or security on mortgage loans is maintained as
required by the transaction agreements or related
mortgage loan documents.
-------------------- ------------------------------------------------------- --------------------
1122(d)(4)(ii) Mortgage loan and related documents are safeguarded v as
required by the transaction agreements
-------------------- ------------------------------------------------------- --------------------
1122(d)(4)(iii) Any additions, removals or substitutions to the asset X
pool are made, reviewed and approved in accordance
with any conditions or requirements in the
transaction agreements.
-------------------- ------------------------------------------------------- --------------------
1122(d)(4)(iv) Payments on mortgage loans, including any payoffs, X
made in accordance with the related mortgage loan
documents are posted to the Servicer's obligor
records maintained no more than two business days
after receipt, or such other number of days specified
in the transaction agreements, and allocated to
principal, interest or other items (e.g., escrow) in
accordance with the related mortgage loan documents.
-------------------- ------------------------------------------------------- --------------------
1122(d)(4)(v) The Servicer's records regarding the mortgage loans X
agree with the Servicer's records with respect to an
obligor's unpaid principal balance.
-------------------- ------------------------------------------------------- --------------------
1122(d)(4)(vi) Changes with respect to the terms or status of an X
obligor's mortgage loans (e.g., loan modifications or
re-agings) are made, reviewed and approved by
authorized personnel in accordance with the
transaction agreements and related pool asset
documents.
-------------------- ------------------------------------------------------- --------------------
EXH-17-3
-------------------- ------------------------------------------------------- --------------------
Applicable
Servicing Criteria Servicing Criteria
-------------------- ------------------------------------------------------- --------------------
Reference Criteria
-------------------- ------------------------------------------------------- --------------------
1122(d)(4)(vii) Loss mitigation or recovery actions (e.g., X
forbearance plans, modifications and deeds in lieu of
foreclosure, foreclosures and repossessions, as
applicable) are initiated, conducted and concluded in
accordance with the timeframes or other requirements
established by the transaction agreements.
-------------------- ------------------------------------------------------- --------------------
1122(d)(4)(viii) Records documenting collection efforts are maintained X
during the period a mortgage loan is delinquent in
accordance with the transaction agreements. Such
records are maintained on at least a monthly basis,
or such other period specified in the transaction
agreements, and describe the entity's activities in
monitoring delinquent mortgage loans including, for
example, phone calls, letters and payment
rescheduling plans in cases where delinquency is
deemed temporary (e.g., illness or unemployment).
-------------------- ------------------------------------------------------- --------------------
1122(d)(4)(ix) Adjustments to interest rates or rates of return for X
mortgage loans with variable rates are computed based
on the related mortgage loan documents.
-------------------- ------------------------------------------------------- --------------------
1122(d)(4)(x) Regarding any funds held in trust for an obligor X
(such as escrow accounts): (A) such funds are
analyzed, in accordance with the obligor's mortgage
loan documents, on at least an annual basis, or such
other period specified in the transaction agreements;
(B) interest on such funds is paid, or credited, to
obligors in accordance with applicable mortgage loan
documents and state laws; and (C) such funds are
returned to the obligor within 30 calendar days of
full repayment of the related mortgage loans, or such
other number of days specified in the transaction
agreements.
-------------------- ------------------------------------------------------- --------------------
1122(d)(4)(xi) Payments made on behalf of an obligor (such as tax or X
insurance payments) are made on or before the related
penalty or expiration dates, as indicated on the
appropriate bills or notices for such payments,
provided that such support has been received by the
servicer at least 30 calendar days prior to these
dates, or such other number of days specified in the
transaction agreements.
-------------------- ------------------------------------------------------- --------------------
1122(d)(4)(xii) Any late payment penalties in connection with any X
payment to be made on behalf of an obligor are paid
from the servicer's funds and not charged to the
obligor, unless the late payment was due to the
obligor's error or omission.
-------------------- ------------------------------------------------------- --------------------
EXH-17-4
-------------------- ------------------------------------------------------- --------------------
Applicable
Servicing Criteria Servicing Criteria
-------------------- ------------------------------------------------------- --------------------
Reference Criteria
-------------------- ------------------------------------------------------- --------------------
1122(d)(4)(xiii) Disbursements made on behalf of an obligor are posted X
within two business days to the obligor's records
maintained by the servicer, or such other number of
days specified in the transaction agreements.
-------------------- ------------------------------------------------------- --------------------
1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible accounts X
are recognized and recorded in accordance with the
transaction agreements.
-------------------- ------------------------------------------------------- --------------------
1122(d)(4)(xv) Any external enhancement or other support, identified X
in Item 1114(a)(1) through (3) or Item 1115 of (if applicable)
Regulation AB, is maintained as set forth in the
transaction agreements.
-------------------- ------------------------------------------------------- --------------------
[NAME OF SELLER] [NAME OF SUBSERVICER]
Date:__________________________________
By:____________________________________
Name:
Title:
EXH-17-5