EXHIBIT 99.17
EXECUTION COPY
================================================================================
ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
among
XXXXXXX XXXXX MORTGAGE COMPANY,
as Assignor
GS MORTGAGE SECURITIES CORP.,
as Assignee
and
AVELO MORTGAGE, L.L.C.
as Servicer
Dated as of
March 30, 2006
================================================================================
ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT, dated March 30,
2006 (this "Agreement"), among Xxxxxxx Sachs Mortgage Company ("Assignor"), GS
Mortgage Securities Corp. ("Assignee") and Avelo Mortgage, L.L.C. ( the
"Company").
For and in consideration of the mutual promises contained herein
and other good and valuable consideration the receipt and sufficiency of which
are hereby acknowledged, and of the mutual covenants herein contained, the
parties hereto hereby agree as follows:
1. Assignment, Assumption and Conveyance.
The Assignor hereby conveys, sells, grants, transfers and assigns
to the Assignee all of the right, title and interest (other than those rights
specifically retained by the Assignor pursuant to this Agreement) 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) solely insofar as it relates to the
Mortgage Loans, that certain Flow Servicing Agreement, dated as of January 1,
2006 (the "Servicing Agreement"), by and between the Assignor, as owner (the
"Owner") and the Company. The Assignor hereby agrees that it will (i) deliver
possession of notes evidencing the Mortgage Loans to, or at the direction of,
the Assignee or its designee and (ii) take in a timely manner all necessary
steps under all applicable laws to convey and to perfect the conveyance of the
Mortgage Loans as required under the Trust Agreement (as defined below).
The Assignor specifically reserves and does not assign to the
Assignee hereunder (i) any and all right, title and interest in, to and under
and any obligations of the Assignor with respect to any mortgage loans subject
to the Servicing Agreement that are not the Mortgage Loans set forth on the
Mortgage Loan Schedule and are not the subject of this Agreement, (ii) any
rights and obligations of the Assignor pursuant to the Servicing Agreement
arising prior to the date hereof or (iii) the rights and obligations of the
Owner under the following sections of the Servicing Agreement: Section 6.02
(relating to the Owner's right to terminate the Company) and Section 5.01
(relating to the Owner's right to receive information from the Servicer).
The Assignee hereby assumes all of the Assignor's obligations
under the Mortgage Loans and the Servicing Agreement solely insofar as such
obligations relate to the Mortgage Loans, other than the obligations set forth
in clauses (ii) and (iii) of the preceding paragraph.
The parties hereto agree that with respect to the Mortgage Loans
being serviced under the Servicing Agreement the Servicing Fee Rate for the
Mortgage Loans shall be the rate set forth on the Mortgage Loan Schedule.
2. Recognition of the Company.
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 Servicing
Agreement (solely to the extent set forth herein) and this Agreement to U.S.
Bank National Association, as trustee (including its successors in interest
and any successor trustees under the Trust Agreement, the "Trustee"), of the
GSAA Home Equity Trust 2006-5 (the "Trust") created pursuant to a Master
Servicing and Trust Agreement, dated as of March 1, 2006 (the "Trust
Agreement"), among the Assignee, the Trustee, U.S. Bank National Association,
as a custodian, Deutsche Bank National Trust Company, as a custodian and
JPMorgan Chase Bank, National Association, as master servicer (including its
successors in interest and any successor servicer under the Trust Agreement,
the "Master Servicer"), as securities administrator and as a custodian. The
Company hereby acknowledges and agrees that from and after the date hereof (i)
the Trust will be the owner of the Mortgage Loans and the Company will be the
servicer of the Mortgage Loans on or after the applicable Transfer Date
pursuant to the terms set forth in the Trust Agreement, (ii) the Company shall
look solely to the Trust (including the Trustee and the Master Servicer acting
on the Trust's behalf) for performance of any obligations of the Assignor
under the Mortgage Loans and the Servicing Agreement (solely insofar as it
relates to the Mortgage Loans) (except for such obligations of the Assignor
retained by the Assignor hereunder), (iii) the Trust (including the Trustee
and the Master 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 applicable purchase agreement pursuant to which the
Owner purchased the related Mortgage Loans from the related Seller and the
Servicing Agreement, including, without limitation, the enforcement of the
document delivery requirements set forth in Section 5(b) of the related
purchase agreement, and shall be entitled to enforce all of the obligations of
the Company thereunder insofar as they relate to the Mortgage Loans, including
without limitation, the remedies for breaches of representations and
warranties set forth in Article IX of the Servicing Agreement (except for the
rights and remedies retained by the Assignor hereunder), (iv) all references
to the Owner under the Servicing Agreement insofar as they relate to the
Mortgage Loans shall be deemed to refer to the Trust (except to the extent of
the rights and obligations retained by the Assignor hereunder) (including the
Trustee and the Servicer acting on the Trust's behalf) and (v) the Mortgage
Loans will be part of a REMIC, and the Company shall service the Mortgage
Loans and any real property acquired upon default thereof (including, without
limitation, making or permitting any modification, waiver or amendment of any
term of any Mortgage Loan) prior to the applicable Transfer Date in accordance
with the Servicing Agreement but in no event in a manner that would (A) cause
the REMIC to fail to qualify as a REMIC or (B) result in the imposition of a
tax upon the REMIC (including but not limited to the tax on prohibited
transactions as defined in Section 860F(a)(2) of the Code, the tax on
contributions to a REMIC set forth in Section 860G(d) of the Code, and the tax
on "net income from foreclosure property" as set forth in Section 860G(c) of
the Code). 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
Servicing Agreement which amendment, modification, waiver or other alteration
would in any way affect the Mortgage Loans or the Company's performance under
the Servicing Agreement with respect to the Mortgage Loans without the prior
written consent of the Trustee.
3
3. Modification of the Servicing Agreement. Only in so far as it
relates to the Mortgage Loans, the Servicer and the Assignor hereby amend the
Servicing Agreement as follows:
(a) Section 2.05 shall be amended as follows:
(i) "and" shall be deleted from the end of subsection
(vii);
(ii) subsection (viii) shall be amended by deleting
the "." at the end of subsection (viii) and replacing it with ";
and"
(iii) a new subsection (ix) shall be added to Section
2.05 immediately following subsection (viii) which shall read as
follows:
"(ix) to reimburse itself for Monthly Advances of the Servicer's
funds made pursuant to Section 3.04, the Servicer's right to reimburse itself
pursuant to this subclause (ix) being limited to related Liquidation Proceeds,
Condemnation Proceeds, Insurance Proceeds and such other amounts as may be
collected by the Servicer from the Mortgagor or otherwise relating to the
Mortgage Loan, including amounts received on the related Mortgage Loan which
represent late payments of principal and/or interest respecting which any such
advance was made, it being understood that, in the case of any such
reimbursement, the Servicer's right thereto shall be prior to the rights of
Purchaser."
(b) the third paragraph of Section 2.18 shall be deleted and
replaced as follows:
"The Servicer shall use its best efforts to dispose of the REO
Property as soon as possible and shall sell such REO Property in any event
within one year after title has been taken to such REO Property, unless (i) a
REMIC election has not been made with respect to the arrangement under which
the Mortgage Loans and the REO Property are held, and (ii) the Servicer
determines, and gives an appropriate notice to the Purchaser to such effect,
that a longer period is necessary for the orderly liquidation of such REO
Property; provided however, that the Servicer agrees not to sell or dispose of
any such Mortgage Loan to a person who acquires such Mortgage Loan using a
purchase money mortgage. If a period longer than one year is permitted under
the foregoing sentence and is necessary to sell any REO Property, the Servicer
shall report monthly to the Purchaser as to the progress being made in selling
such REO Property, and provided further, that if the Servicer is unable to
sell such REO Property within three years of acquisition, the Servicer shall
obtain an extension from the Internal Revenue Service."
(c) Section 3.04 will be amended by adding a new paragraph as
follows:
"In the event that the Servicer determines that any such
advances are non-recoverable, the Servicer shall provide the Owner with a
certificate signed by an officer of the Servicer evidencing such
determination. Notwithstanding the foregoing, the Servicer shall not be
permitted to make any advances from amounts held for future distribution, and
instead shall be required to make all advances from its own funds, unless the
Servicer, its parent, or their
4
respective successors hereunder shall have a long term credit rating of at
least "A" by Fitch, Inc., or the equivalent rating of another Rating Agency."
(d) a new section, Section 11.17, will be added immediately
following Section 11.16 which shall read as follows:
"Section 11.17 Third-Party Beneficiary. JPMorgan Chase Bank,
National Association, as master servicer, securities administrator and a
custodian under the Master Servicing and Trust Agreement, dated as of March 1,
2006, among GS Mortgage Securities Corp., U.S. Bank National Association, as
trustee and a custodian and Deutsche Bank National Trust Company, as
custodian, shall be considered a third-party beneficiary to this Agreement
entitled to all of the rights and benefits accruing to it as if it were a
direct party to this Agreement."
4. Representations and Warranties of the Company.
The Company warrants and represents to and covenants with, 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 formation;
(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 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 or
the consummation by it of the transaction contemplated hereby;
5
(d) The Company shall establish a Custodial Account and an Escrow
Account under the Servicing Agreement in favor of the Trust with respect
to the Mortgage Loans separate from the Custodial Account and Escrow
Account previously established under the Servicing Agreement in favor of
the Assignor;
(e) 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 Servicing Agreement, or which, either in any one
instance or in the aggregate, is likely to result in any material
adverse change in the ability of the Company to perform its obligations
under this Agreement or the Servicing Agreement, and the Company is
solvent;
(f) The Company has serviced the Mortgage Loans in accordance with
the Servicing Agreement and has provided accurate "paid through" data
(assuming the correctness of all "paid through" data provided by the
Assignor to the Company at the time the Company began servicing the
Mortgage Loans) with respect to the Mortgage Loans to the Assignor;
(g) Except as reflected in the "paid through" data delivered to
the Assignor (assuming the correctness of all "paid through" data
provided by the Assignor to the Company at the time the Company began
servicing the Mortgage Loans), there is no payment default existing
under any Mortgage or any Mortgage Note as of the Securitization Closing
Date; and
(h) To the Company's knowledge, there is no non-payment default
existing under any Mortgage or Mortgage Note, or any event which, with
the passage of time or with notice and the termination of any grace or
cure period, would constitute a non-payment default, breach, violation
or event which would permit acceleration as of the Securitization
Closing Date.
Pursuant to Section 9.01 of the 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 Article IX
of the Servicing Agreement are true and correct as of the date hereof as if
such representations and warranties were made on the date hereof.
5. Representations and Warranties of the Assignor.
The Assignor warrants and represents to the Assignee and the Trust
as of date hereof that:
(a) Prior Assignments; Pledges. Except for the sale to the
Assignee, the Assignor has not assigned or pledged any Mortgage Note or
the related Mortgage or any interest or participation therein;
(b) Releases. The Assignor has not satisfied, canceled or
subordinated in whole or in part, or rescinded any Mortgage, and the
Assignor has not released the related Mortgaged Property from the lien
of any Mortgage, in whole or in part, nor has the
6
Assignor executed an instrument that would effect any such release,
cancellation, subordination, or rescission. The Assignor has not
released any Mortgagor, in whole or in part, except in connection with
an assumption agreement or other agreement approved by the related
federal insurer, to the extent such approval was required;
(c) No Waiver. The Assignor has not waived the performance by any
Mortgagor of any action, if such Mortgagor's failure to perform such
action would cause the Mortgage Loan to be in default, nor has the
Company waived any default resulting from any action or inaction by such
Mortgagor;
(d) Compliance with Applicable Laws. With respect to each Mortgage
Loan, any and all requirements of any federal, state or local law
including, without limitation, usury, truth-in-lending, real estate
settlement procedures, consumer credit protection, equal credit
opportunity, predatory and abusive lending or disclosure laws applicable
to such Mortgage Loan, including without limitation, any provisions
relating to prepayment charges, have been complied with;
(e) High Cost. With respect to the Mortgage Loans, no Mortgage
Loan is categorized as "High Cost" pursuant to the then-current Standard
& Poor's Glossary for File Format for LEVELS(R) Version 5.6(d), Appendix
E, as revised from time to time and in effect as of the Original
Purchase Date. Furthermore, none of the Mortgage Loans sold by the
Seller are classified as (a) a "high cost mortgage" loan under the Home
Ownership and Equity Protection Act of 1994 or (b) a "high cost home,"
"covered," "high-cost," "high-risk home," or "predatory" loan under any
other applicable state, federal or local law;
(f) Georgia Fair Lending Act. No Mortgage Loan is secured by a
property in the state of Georgia and originated between October 1, 2002
and March 7, 2003;
(g) Qualified Mortgage Loan. Each Mortgage Loan is a "qualified
mortgage" under Section 860G(a)(3) of the Internal Revenue Code of 1986,
as amended; and
(h) Credit Reporting. The Assignor will cause to be fully
furnished, in accordance with the Fair Credit Reporting Act and its
implementing regulations, accurate and complete information (i.e.,
favorable and unfavorable) on Mortgagor credit files to Equifax,
Experian and Trans Union Credit Information Company (three of the credit
repositories), on a monthly basis; and
(i) Prepayment Premiums. To the Assignor's knowledge, no Mortgage
Loan originated on or after October 1, 2002 will impose a prepayment
premium for a term in excess of three years. Any loans originated prior
to such date, and any non-subprime loans, will not impose prepayment
penalties in excess of five years.
6. Remedies for Breach of Representations and Warranties of the
Assignor.
The Assignor hereby acknowledges and agrees that in the event of
any breach of the representations and warranties made by the Assignor set
forth in Section 4 hereof or in Section 1 of the Representations and
Warranties Agreement, dated as of March 30, 2006,
7
between the Assignor and Assignee (the "Representations and Warranties
Agreement") that materially and adversely affects the value of the Mortgage
Loans or the interest of the Assignee or the Trust therein, within sixty (60)
days of the earlier of either discovery by or notice to the Assignor of such
breach of a representation or warranty, it shall cure, purchase, cause the
purchase of, or substitute for the applicable Mortgage Loan in the same manner
and subject to the conditions set forth in Section 2 of the Representations
and Warranties Agreement.
7. Miscellaneous.
(a) 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.
(b) 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.
(c) 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 Master Servicer acting on the Trust's
behalf). Any entity into which the Assignor, Assignee or the Company may
be merged or consolidated shall, without the requirement for any further
writing, be deemed Assignor, Assignee or the Company, respectively,
hereunder.
(d) Each of this Agreement and the Servicing Agreement shall
survive the conveyance of the Mortgage Loans to the Trust and the
assignment of the purchase agreements and the Servicing Agreement (to
the extent assigned hereunder) by the Assignor to the Assignee and by
Assignee to the Trust and nothing contained herein shall supersede or
amend the terms of the purchase agreements and the Servicing Agreement.
(e) 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.
(f) In the event that any provision of this Agreement conflicts
with any provision of the purchase agreements or the Servicing Agreement
with respect to the Mortgage Loans, the terms of this Agreement shall
control.
(g) 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 purchase agreements or the Servicing
Agreement, as applicable.
[SIGNATURE PAGE FOLLOWS]
8
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
GS MORTGAGE SECURITIES CORP.
By: /s/ Xxxxxxxx Xxxx
-------------------------------------
Name: Xxxxxxxx Xxxx
Title: Vice President
XXXXXXX XXXXX MORTGAGE COMPANY
By: XXXXXXX SACHS REAL ESTATE FUNDING
CORP., its General Partner
By: /s/ Xxxx Xxxxx
-------------------------------------
Name: Xxxx Xxxxx
Title: Managing Director
AVELO MORTGAGE, L.L.C. (Servicer)
By: /s/ Xxxxxx Xxxxxxx
-------------------------------------
Name: Xxxxxx Xxxxxxx
Title: President
Conduit/Avelo Step 1 AAR
EXHIBIT A
Mortgage Loan Schedule
[On File with the Securities Administrator as provided by the Depositor]
A-1
