Common use of Maintenance of Errors and Omissions and Fidelity Coverage Clause in Contracts

Maintenance of Errors and Omissions and Fidelity Coverage. (a) Each Servicer shall obtain and maintain at its own expense, and keep in full force and effect throughout the term of this Agreement, a blanket fidelity bond and an errors and omissions insurance policy issued by a Qualified Insurer covering such Servicer's officers and employees in connection with its activities under this Agreement. The amount of coverage shall be determined in accordance with Accepted Servicing Practices and be at least equal to the sum of the following based upon the total portfolio that such Servicer services for itself and all others: (i) $300,000, plus; (ii) 0.150% of the excess of the unpaid principal balance of all the mortgage loans serviced by such Servicer over $100,000,000 but less than or equal to $500,000,000, plus; (iii) 0.125% of the excess of the unpaid principal balance of all the mortgage loans serviced by such Servicer over $500,000,000 but less than or equal to $1,000,000,000 plus; (iv) 0.100% of the excess of the unpaid principal balance of all the mortgage loans serviced by such Servicer over $1,000,000,000. The deductible on the fidelity bond or errors and omissions policy shall not exceed the greater of $100,000 and five (5) percent of the face amount of such bond or policy. In the event that any such bond or policy ceases to be in effect, such Servicer shall immediately obtain a comparable replacement bond or policy. Notwithstanding the foregoing, so long as the long term unsecured debt obligations of such Servicer or its corporate parent have the Required Rating for Eligible Accounts, such Servicer shall be entitled to provide self-insurance or obtain from its parent adequate insurance, as applicable, with respect to its obligation to maintain a blanket fidelity bond or an errors and omissions insurance policy. (b) From time to time, upon the request of the Trustee, each Servicer shall furnish the Trustee copies of all binders or certificates evidencing that the bond and policy described in clause (a) above are in full force and effect. Each Servicer shall promptly report in writing to the Trustee and each other Servicer any change in such coverage resulting in a failure to satisfy the requirements of clause (a) above and all cases of embezzlement or fraud or irregularities of operation if such events involve such Servicer and funds relating to the Mortgage Loans. The total losses, regardless of whether claims are filed with the applicable insurer or surety, shall be disclosed in such reports together with the amount of such losses covered by insurance. If a bond or insurance claim report is filed with any of such Servicer's bonding companies or insurers, a copy of such report shall be promptly furnished to the Trustee and each other Servicer.

Appears in 2 contracts

Samples: Pooling and Servicing Agreement (Morgan J P Commercial Mortgage Finance Corp), Pooling and Servicing Agreement (Morgan J P Commercial Mortgage Finance Corp)

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Maintenance of Errors and Omissions and Fidelity Coverage. (a) Each Servicer shall obtain and maintain at its own expense, and keep in full force and effect throughout the term of this Agreement, a blanket fidelity bond and an errors and omissions insurance policy issued by a Qualified Insurer covering such Servicer's officers and employees in connection with its activities under this Agreement. The Trustee shall be designated as a loss payee under such policy. The amount of coverage shall be determined in accordance with Accepted Master Servicing Practices and Accepted Special Servicing Practices and be at least equal to the sum of the following based upon the total portfolio that such Servicer services for itself and all others: (i) $300,000, plus; (ii) 0.150% of the excess of the unpaid principal balance of all the mortgage loans serviced by such Servicer over $100,000,000 but less than or equal to $500,000,000, plus; (iii) 0.125% of the excess of the unpaid principal balance of all the mortgage loans serviced by such Servicer over $500,000,000 but less than or equal to $1,000,000,000 plus; (iv) 0.100% of the excess of the unpaid principal balance of all the mortgage loans serviced by such Servicer over $1,000,000,000. The deductible on the fidelity bond or errors and omissions policy shall not exceed the greater of $100,000 and five (5) percent of the face amount of such bond or policy. In the event that any such bond or policy ceases to be in effect, such Servicer shall immediately obtain a comparable replacement bond or policy. Notwithstanding the foregoing, so long as the long term unsecured debt obligations of such Servicer or its corporate parent have the Required Rating for long term investments on Eligible Accounts, such Servicer shall be entitled to provide self-insurance or obtain from its parent adequate insurance, as applicable, with respect to its obligation to maintain a blanket fidelity bond or an errors and omissions insurance policy. (b) From time to time, upon the request of the Trustee, each Servicer shall furnish the Trustee copies of all binders or certificates evidencing that the bond and policy described in clause (a) above are in full force and effect. Each Servicer shall promptly report in writing to the Trustee and each other Servicer any change in such coverage resulting in a failure to satisfy the requirements of clause (a) above and all cases of embezzlement or fraud or irregularities of operation if such events involve such Servicer and funds relating to the Mortgage Loans. The total losses, regardless of whether claims are filed with the applicable insurer or surety, shall be disclosed in such reports together with the amount of such losses covered by insurance. If a bond or insurance claim report is filed with any of such Servicer's bonding companies or insurers, a copy of such report (which report may omit any references to individuals suspected of embezzlement, fraud or irregularities of operation) shall be promptly furnished to the Trustee and each other Servicer.

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Jp Morgan Chase Commercial Mortgage Securities Corp)

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Maintenance of Errors and Omissions and Fidelity Coverage. (a) Each Servicer shall obtain and maintain at its own expense, and keep in full force and effect throughout the term of this Agreement, a blanket fidelity bond and an errors and omissions insurance policy issued by a Qualified Insurer covering such Servicer's officers and employees and other Persons acting on behalf of such Servicer in connection with its activities under this Agreement. The amount of coverage shall be determined in accordance with Accepted Servicing Practices and be at least equal to the sum of the following based upon the total portfolio that such Servicer services for itself and all others: (i) $300,000, plus; (ii) 0.150% of the excess of the unpaid principal balance of all the mortgage loans serviced by such Servicer over $100,000,000 but less than or equal to $500,000,000, plus; (iii) 0.125% of the excess of the unpaid principal balance of all the mortgage loans serviced by such Servicer over $500,000,000 but less than or equal to $1,000,000,000 plus; (iv) 0.100% of the excess of the unpaid principal balance of all the mortgage loans serviced by such Servicer over $1,000,000,000. The deductible on the fidelity bond or errors and omissions policy shall not exceed the greater of $100,000 and five (5) percent of the face amount of such bond or policy. In the event that any such bond or policy ceases to be in effect, such Servicer shall immediately obtain a comparable replacement bond or policy. Notwithstanding the foregoing, so long as the long term unsecured debt obligations of such Servicer or its corporate parent have the Required Rating for Eligible Accounts, such Servicer shall be entitled to provide self-insurance or obtain from its parent adequate insurance, as applicable, with respect to its obligation to maintain a blanket fidelity bond or an errors and omissions insurance policy. (b) From time to time, upon the request of the Master Servicer or the Trustee, each Servicer shall furnish the Master Servicer and the Trustee copies of all binders or certificates evidencing that the bond and policy described in clause (a) above are in full force and effect. Each Servicer shall promptly report in writing to the Trustee and each other Servicer any change in such coverage resulting in a failure to satisfy the requirements of clause (a) above and all cases of embezzlement or fraud or irregularities of operation operation, suspected or otherwise, if such events involve such Servicer and funds relating to the Mortgage Loans. The total losses, regardless of whether claims are filed with the applicable insurer or surety, shall be disclosed in such reports together with the amount of such losses covered by insurance. If a bond or insurance claim report is filed with any of such Servicer's bonding companies or insurers, a copy of such report shall be promptly furnished to the Trustee and each other Servicer.

Appears in 1 contract

Samples: Pooling and Servicing Agreement (Morgan J P Commercial Mortgage Finance Corp)

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