Common use of Warranty of Performance Clause in Contracts

Warranty of Performance. Within 90 days of receipt of notice by the Agent of a breach of any Covered Obligation that materially and adversely affects the value of any Mortgage Loan or the interest therein of the Depositor or the Depositor’s assignee, transferee or designee, the Agent promptly shall cure such defect or breach in all material respects, or in the event such defect or breach cannot be cured, the Agent shall either (i) repurchase the affected Mortgage Loan at the Purchase Price (as such term is defined in the Pooling and Servicing Agreement) or (ii) subject to the approval of the Depositor or the Depositor’s assignee, transferee or designee, cause the removal of such Mortgage Loan from the Trust Fund and substitute one or more Qualified Substitute Mortgage Loans. Notwithstanding the preceding sentence, if a breach of representation or warranty cannot reasonably be cured within 90 days after written notice thereof, and the Agent shall have commenced to cure such breach within such 90 day period and thereafter diligently and expeditiously proceeds to cure the same, such 90 day period shall be extended for so long as it shall require the Agent in the exercise of due diligence to cure such breach, it being agreed that no such extension shall be for a period in excess of the lesser of 90 days or the period of time during which the seller or the depositor is required to cure a defect or breach or repurchase an affected Mortgage Loan pursuant to any sale and/or securitization agreement or arrangement it may enter into. The Agent shall indemnify the Trustee and the Trust Fund for the amount of any costs and damages incurred by the Trust Fund as a result of any violation of any predatory or abusive lending law arising from or in connection with the origination of such affected Mortgage Loan, to the extent that such costs or damages are not covered by the applicable Purchase Price and result in a reduction of amounts distributable on the Certificates.