EXHIBIT 99.2
Ex-99.2
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COUNTRYWIDE HOME LOANS, INC.
a Seller
COUNTRYWIDE LFT LLC
a Seller
PARK MONACO INC.
a Seller
CWHEQ, INC.
Purchaser
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PURCHASE AGREEMENT
Dated as of August 30, 2005
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REVOLVING HOME EQUITY LOAN ASSET BACKED NOTES
Series 2005-D
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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS.........................................................1
Section 1.01. Definitions.............................................1
ARTICLE II SALE OF MORTGAGE LOANS; PAYMENT OF PURCHASE PRICE..................2
Section 2.01. Sale of the Mortgage Loans..............................2
Section 2.02. Obligations of Sellers Upon Sale........................3
Section 2.03. Payment of Purchase Price for the Mortgage Loans........6
ARTICLE III REPRESENTATIONS AND WARRANTIES; REMEDIES FOR BREACH...............6
Section 3.01. Seller Representations and Warranties...................6
Section 3.02. Seller Representations and Warranties Relating
to the Mortgage Loans...................................9
ARTICLE IV SELLERS' COVENANTS................................................22
Section 4.01. Covenants of the Sellers...............................22
ARTICLE V SERVICING..........................................................22
Section 5.01. Servicing..............................................22
ARTICLE VI TERMINATION.......................................................22
Section 6.01. Termination............................................22
ARTICLE VII MISCELLANEOUS PROVISIONS.........................................23
Section 7.01. Amendment..............................................23
Section 7.02. Governing Law..........................................23
Section 7.03. Notices................................................23
Section 7.04. Severability of Provisions.............................24
Section 7.05. Counterparts; Electornic Delivery......................24
Section 7.06. Further Agreements.....................................24
Section 7.07. Successors and Assigns: Assignment of
Purchase Agreement.....................................24
Section 7.08. Survival...............................................25
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SCHEDULES AND ANNEXES
Schedule I MORTGAGE LOAN SCHEDULE............................Sch-I-1
Schedule II STANDARD & POOR'S GLOSSARY.......................Sch-II-1
Annex 1 ADOPTION ANNEX....................................Xxx-1-1
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This PURCHASE AGREEMENT, dated as of August 30, 2005 (the
"Agreement"), between COUNTRYWIDE HOME LOANS, INC., a New York corporation, as
a seller ("CHL" or a "Seller"), COUNTRYWIDE LFT LLC, a Delaware limited
liability company, as a seller ("CLFT" or a "Seller"), PARK MONACO INC., a
Delaware corporation, as a seller ("Park Monaco" or a "Seller," and together
with CHL and CLFT, the "Sellers"), and CWHEQ, INC., a Delaware corporation
(the "Purchaser"),
WITNESSETH:
WHEREAS, each Seller is the owner of the applicable notes or other
evidence of indebtedness indicated on Schedule I as owned by that Seller, and
certain other notes or other evidence of indebtedness made or to be made in
the future, and Related Documentation; and
WHEREAS, by the date of their transfer, each Seller will own the
mortgages on the properties securing the Mortgage Loans indicated on Schedule
I as owned by that Seller, including rights to (a) any property acquired by
foreclosure or deed in lieu of foreclosure or otherwise and (b) the proceeds
of any hazard insurance policies on the Mortgaged Properties; and
WHEREAS, each Seller wants to sell its Mortgage Loans to the
Purchaser pursuant to this Agreement; and
WHEREAS, pursuant to the Sale and Servicing Agreement, of even date
with this Agreement (the "Sale and Servicing Agreement"), among the Purchaser,
as depositor, CHL, as sponsor and master servicer, the Trust, and the
Indenture Trustee, the Purchaser will transfer the Mortgage Loans to the
Trust;
NOW, THEREFORE, the parties agree as follows.
ARTICLE I
DEFINITIONS
Section 1.01. Definitions.
Capitalized terms used in this Agreement that are not otherwise
defined have the meanings given to them in the Indenture, and if not defined
there, in the Sale and Servicing Agreement. In addition, Section 1.04 (Rules
of Construction) of the Indenture is incorporated by reference with
appropriate substitution of this Agreement for references in that Section to
the Indenture so that the language of that Section will read appropriately as
applying to this Agreement.
ARTICLE II
SALE OF MORTGAGE LOANS; PAYMENT OF PURCHASE PRICE
Section 2.01. Sale of the Mortgage Loans.
(a) The Mortgage Loans. Concurrently with the execution and delivery
of this Agreement, CHL, with respect to each Mortgage Loan it owns as
indicated on Schedule I, hereby transfers to the Purchaser, without recourse,
all of its right, title, and interest existing now or in the future in
(1) that Mortgage Loan, including its Asset Balance (including
all Additional Balances), the related Mortgage File, all property
that secures that Mortgage Loan, and all collections received on it
after the Cut-off Date (excluding payments due by the Cut-off Date);
(2) property that secured that Mortgage Loan that is acquired
by foreclosure or deed in lieu of foreclosure;
(3) its rights under the hazard insurance policies related to
the mortgages that secure the Mortgage Loans;
(4) all rights under any guaranty executed in connection with
that Mortgage Loan;
(5) all other assets included or to be included in the Trust
for the benefit of the Noteholders and the Credit Enhancer; and
(6) all proceeds of the foregoing.
CLFT, with respect to each Mortgage Loan it owns as indicated on
Schedule I, hereby transfers to the Purchaser, without recourse, all of its
right, title, and interest existing now or in the future in
(1) that Mortgage Loan, including its Asset Balance (including
all Additional Balances), the related Mortgage File, all property
that secures that Mortgage Loan, and all collections received on it
after the Cut-off Date (excluding payments due by the Cut-off Date);
(2) property that secured that Mortgage Loan that is acquired
by foreclosure or deed in lieu of foreclosure;
(3) its rights under the hazard insurance policies related to
the mortgages that secure the Mortgage Loans;
(4) all rights under any guaranty executed in connection with
that Mortgage Loan;
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(5) all other assets included or to be included in the Trust
for the benefit of the Noteholders and the Credit Enhancer; and
(6) all proceeds of the foregoing.
Park Monaco, with respect to each Mortgage Loan it owns as indicated
on Schedule I, hereby transfers to the Purchaser, without recourse, all of its
right, title, and interest existing now or in the future in
(1) that Mortgage Loan, including its Asset Balance (including
all Additional Balances), the related Mortgage File, all property
that secures that Mortgage Loan, and all collections received on it
after the Cut-off Date (excluding payments due by the Cut-off Date);
(2) property that secured that Mortgage Loan that is acquired
by foreclosure or deed in lieu of foreclosure;
(3) its rights under the hazard insurance policies related to
the mortgages that secure the Mortgage Loans;
(4) all rights under any guaranty executed in connection with
that Mortgage Loan;
(5) all other assets included or to be included in the Trust
for the benefit of the Noteholders and the Credit Enhancer; and
(6) all proceeds of the foregoing.
(b) By the sale of a Mortgage Loan and its Additional Balances, each
Seller has sold to the Purchaser, and the Purchaser has purchased from each
Seller, each future draw of new borrowing under the related Credit Line
Agreement. The Purchaser shall pay the applicable Seller for each Additional
Balance in cash in an amount equal to the principal amount of the Additional
Balance as it arises. The Trust, the applicable Seller, and the Purchaser may
agree to a netting arrangement in connection with this transaction, when
appropriate, rather than actually moving cash.
Section 2.02. Obligations of Sellers Upon Sale.
In connection with the transfers pursuant to Section 2.01(a), each
Seller further agrees, at its own expense:
(a) to deliver to the Purchaser by the Closing Date a Mortgage Loan
Schedule containing an accurate list of all Mortgage Loans sold by it,
specifying for each Mortgage Loan, among other things, its account number and
its Cut-off Date Asset Balance; and
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(b) to indicate in its books and records that the applicable Mortgage
Loans have been sold to the Indenture Trustee, as assignee of the Purchaser,
pursuant to this Agreement by the Closing Date for the Mortgage Loans.
The Mortgage Loan Schedule containing the Mortgage Loans sold by both
Sellers is Exhibit A to the Sale and Servicing Agreement and shall also be
attached as Schedule I to this Agreement and is hereby incorporated into this
Agreement.
Each Seller agrees to perfect and protect the Purchaser's interest in
each Mortgage Loan transferred by it pursuant to Section 2.01(a) and its
proceeds by preparing, executing, and filing a UCC1 Financing Statement with
the Secretary of State in the State of New York describing the Mortgage Loans
and naming the applicable Seller as debtor and the Purchaser as secured party
and indicating that the Mortgage Loans have been assigned to the Trust and all
necessary Continuation Statements and any additional UCC1 Financing Statements
due to a change in the name or the state of incorporation of that Seller. The
Financing Statement shall be filed by the Closing Date. This Financing
Statement will state in bold-faced type that a purchase of the Mortgage Loans
included in the collateral covered by the Financing Statement from the debtor
will violate the rights of the secured party and its assignee.
The Purchaser agrees to perfect and protect the Trust's interest in
each Mortgage Loan and its proceeds by preparing, executing, and filing a UCC1
Financing Statement with the Secretary of State in the State of Delaware
describing the Mortgage Loans and naming the Purchaser as debtor and the Trust
as secured party (and indicating that the Mortgage Loans have been pledged to
the Indenture Trustee) and all necessary Continuation Statements and any
additional UCC1 Financing Statements due to a change in the name or the state
of incorporation of the Purchaser. The Financing Statement shall be filed by
the Closing Date. This Financing Statement will state in bold-faced type that
a purchase of the Mortgage Loans included in the collateral covered by the
Financing Statement from the debtor will violate the rights of the secured
party and its assignee.
In connection with any transfer by each Seller, it shall deliver to
the order of the Purchaser the following documents for each Mortgage Loan
transferred by that Seller (the "Related Documentation"):
(1) the original Mortgage Note endorsed in blank or, if the
original Mortgage Note has been lost or destroyed and not replaced,
an original lost note affidavit from the Sponsor stating that the
original Mortgage Note was lost, misplaced, or destroyed, together
with a copy of the related Mortgage Note;
(2) unless the Mortgage Loan is registered on the MERS(R)
System, an original assignment of mortgage in blank in recordable
form;
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(3) the original recorded mortgage with evidence of recording
on it (noting the presence of the MIN of the Mortgage Loan and
language indicating that the Mortgage Loan is a MOM Loan if the
Mortgage Loan is a MOM Loan) or, if the original recorded mortgage
with evidence of recording on it cannot be delivered by the Closing
Date because of a delay caused by the public recording office where
the original Mortgage has been delivered for recordation or because
the original Mortgage has been lost, the Sponsor shall deliver to the
Indenture Trustee an accurate copy of the mortgage, together with (i)
when the delay is caused by the public recording office, an Officer's
Certificate of the Sponsor or the Purchaser stating that the original
mortgage has been dispatched to the appropriate public recording
official or (ii) when the original mortgage has been lost, a
certificate by the appropriate county recording office where the
mortgage is recorded;
(4) any original intervening assignments needed for a complete
chain of title to the Trust with evidence of recording on them, or,
if any original intervening assignment has not been returned from the
applicable recording office or has been lost, an accurate copy of it,
together with (i) when the delay is caused by the public recording
office, an Officer's Certificate of the Sponsor or the Purchaser
stating that the original intervening assignment has been dispatched
to the appropriate public recording official for recordation or (ii)
when the original intervening assignment has been lost, a certificate
by the appropriate county recording office where the mortgage is
recorded;
(5) a title policy for each Mortgage Loan with a Credit Limit
in excess of $100,000; (6) the original of any guaranty executed in
connection with the Mortgage Note;
(7) the original of each assumption, modification,
consolidation, or substitution agreement relating to the Mortgage
Loan; and
(8) any security agreement, chattel mortgage, or equivalent
instrument executed in connection with the Mortgage.
The Related Documentation will be delivered:
(1) no later than the Closing Date, with respect to no less
than 50% of the Mortgage Loans in each Loan Group,
(2) no later than the twentieth day after the Closing Date,
with respect to no less than 40% of the Mortgage Loans in each Loan
Group in addition to those delivered on the Closing Date, and
(3) within thirty days following the Closing Date, with respect
to the remaining Mortgage Loans.
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Each Seller confirms to the Purchaser that, as of the Closing Date,
it has caused the portions of the Electronic Ledger relating to the Mortgage
Loans maintained by that Seller to be clearly and unambiguously marked to
indicate that the Mortgage Loans have been sold to the Purchaser, and sold by
the Purchaser to the Trust, and Granted by the Trust to the Indenture Trustee,
and that a purchase of those Mortgage Loans from that Seller or the Purchaser
will violate the rights of the Trust, as secured party with respect to those
Mortgage Loans. By the applicable date of substitution, CHL shall cause the
portions of the Electronic Ledgers relating to the relevant Eligible
Substitute Mortgage Loans, as the case may be, to be clearly and unambiguously
marked, and shall make appropriate entries in its general accounting records,
to indicate that those Mortgage Loans have been transferred to the Trust at
the direction of the Purchaser and that they have been Granted by the Trust to
the Indenture Trustee, and that a purchase of the Mortgage Loans from CHL or
the Purchaser will violate the rights of the Trust, as secured party with
respect to those Mortgage Loans.
The Purchaser accepts all right, title, and interest of each of the
Sellers existing now or in the future in the Mortgage Loans and other property
transferred to it pursuant to this Section.
Notwithstanding the characterization of the Notes as debt for
federal, state, and local income and franchise tax purposes, the transfer of
the Mortgage Loans is a sale by each Seller to the Purchaser of all its
interest in the applicable Mortgage Loans and other property described above.
However, to provide for the possibility that either transfer might be
characterized as a transfer for security and not as a sale, each Seller hereby
Grants to the Purchaser a Security Interest in all of its right, title, and
interest in the applicable Mortgage Loans and other property described above,
whether existing now or in the future, to secure all of that its obligations
under this Agreement; and this Agreement shall constitute a Security Agreement
under applicable law.
Section 2.03. Payment of Purchase Price for the Mortgage Loans.
In consideration of the sale of the Mortgage Loans from each of the
Sellers to the Purchaser on the Closing Date, the Purchaser agrees to transfer
to the applicable Seller on the Closing Date the purchase price for the
applicable Mortgage Loans provided in the Adoption Annex attached as Annex 1
to this Agreement (the "Adoption Annex").
ARTICLE III
REPRESENTATIONS AND WARRANTIES; REMEDIES FOR BREACH
Section 3.01. Seller Representations and Warranties.
(a) CHL represents and warrants to the Purchaser as of the Closing
Date:
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(1) CHL is a New York corporation, validly existing and in good
standing under the laws of the State of New York, and has the
corporate power to own its assets and to transact the business in
which it is currently engaged. CHL is duly qualified to do business
as a foreign corporation 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
other) of CHL;
(2) CHL has the power and authority to make, execute, deliver,
and perform this Agreement and all of the transactions contemplated
by this Agreement, 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 valid
and legally binding obligation of CHL enforceable in accordance with
its terms;
(3) CHL is not required to obtain the consent of any other
party 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, except for any
consents, licenses, approvals or authorizations, or registrations or
declarations, that have been obtained or filed, as the case may be,
before the Closing Date;
(4) The execution, delivery, and performance of this Agreement
by the Seller will not violate any provision of any existing law or
regulation or any order or decree of any court applicable to the
Seller or any provision of the certificate of incorporation or bylaws
of CHL, or constitute a material breach of any mortgage, indenture,
contract, or other agreement to which CHL is a party or by which CHL
may be bound; and
(5) No litigation or administrative proceeding of or before any
court, tribunal, or governmental body is currently pending, or to the
knowledge of CHL threatened, against CHL or any of its properties or
with respect to this Agreement or the Notes that in the opinion of
CHL has a reasonable likelihood of resulting in a material adverse
effect on the transactions contemplated by this Agreement.
(b) CLFT represents and warrants to the Purchaser as of the Closing
Date:
(1) CLFT is a Delaware limited liability company, validly
existing and in good standing under the laws of the State of
Delaware, and has the limited liability company power to own its
assets and to transact the business in which it is currently engaged.
CLFT is duly qualified to do business as a foreign limited liability
company and is in good standing in each jurisdiction in which the
character of the business
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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 other) of CLFT.
(2) CLFT has the power and authority to make, execute, deliver,
and perform this Agreement and all of the transactions contemplated
by this Agreement, and has taken all necessary limited liability
company action to authorize the execution, delivery, and performance
of this Agreement. When executed and delivered, this Agreement will
constitute the valid and legally binding obligation of CLFT
enforceable in accordance with its terms;
(3) CLFT is not required to obtain the consent of any other
party 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, except for any
consents, licenses, approvals or authorizations, or registrations or
declarations, that have been obtained or filed, as the case may be,
before the Closing Date;
(4) The execution, delivery, and performance of this Agreement
by CLFT will not violate any provision of any existing law or
regulation or any order or decree of any court applicable to CLFT or
any provision of its limited liability company agreement, or
constitute a material breach of any mortgage, indenture, contract, or
other agreement to which CLFT is a party or by which CLFT may be
bound; and
(5) No litigation or administrative proceeding of or before any
court, tribunal, or governmental body is currently pending, or to the
knowledge of CLFT threatened, against CLFT or any of its properties
or with respect to this Agreement or the Notes that in the opinion of
CLFT has a reasonable likelihood of resulting in a material adverse
effect on the transactions contemplated by this Agreement.
(c) Park Monaco represents and warrants to the Purchaser as of the
Closing Date:
(1) Park Monaco is a Delaware corporation, validly existing and
in good standing under the laws of the State of Delaware, and has the
corporate power to own its assets and to transact the business in
which it is currently engaged. Park Monaco is duly qualified to do
business as a foreign corporation 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 other) of Park Monaco.
(2) Park Monaco has the power and authority to make, execute,
deliver, and perform this Agreement and all of the transactions
contemplated by this Agreement,
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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 valid and legally
binding obligation of Park Monaco enforceable in accordance with its
terms;
(3) Park Monaco is not required to obtain the consent of any
other party 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, except
for any consents, licenses, approvals or authorizations, or
registrations or declarations, that have been obtained or filed, as
the case may be, before the Closing Date;
(4) The execution, delivery, and performance of this Agreement
by Park Monaco will not violate any provision of any existing law or
regulation or any order or decree of any court applicable to Park
Monaco or any provision of the certificate of incorporation or bylaws
of Park Monaco, or constitute a material breach of any mortgage,
indenture, contract, or other agreement to which Park Monaco is a
party or by which Park Monaco may be bound; and
(5) No litigation or administrative proceeding of or before any
court, tribunal, or governmental body is currently pending, or to the
knowledge of Park Monaco threatened, against Park Monaco or any of
its properties or with respect to this Agreement or the Notes that in
the opinion of Park Monaco has a reasonable likelihood of resulting
in a material adverse effect on the transactions contemplated by this
Agreement.
(d) The representations and warranties in this Section 3.01 shall
survive the transfer of the Mortgage Loans to the Purchaser. CHL shall cure a
breach of any of the representations and warranties of CHL, CLFT, and Park
Monaco in accordance with the Sale and Servicing Agreement. The remedy
specified in the Sale and Servicing Agreement shall constitute the sole remedy
against a Seller with respect to any breach.
Section 3.02. Seller Representations and Warranties Relating to the
Mortgage Loans.
(a) CHL represents and warrants to the Purchaser as of the Cut-off
Date, unless specifically stated otherwise:
(1) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution) this
Agreement constitutes a valid and legally binding obligation of CHL,
enforceable against CHL in accordance with its terms.
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(2) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), either
(A) this Agreement constitutes a valid transfer to the
Purchaser of all right, title, and interest of each of the
Sellers in the Mortgage Loans, and all collections received in
respect of the Mortgage Loans after the Cut-off Date (excluding
payments due by the Cut-off Date), all proceeds of the Mortgage
Loans, and all other property specified in Section 2.01(a) or
(b), and the Sale and Servicing Agreement constitutes a valid
transfer to the Trust of the foregoing property and all other
property specified in Section 2.01(a) or (b) of the Sale and
Servicing Agreement such that, on execution of the Sale and
Servicing Agreement, it is owned by the Trust free of all liens
and other encumbrances, and is part of the corpus of the Trust
transferred to the Trust by the Purchaser, and upon payment for
the Additional Balances, this Agreement and the Sale and
Servicing Agreement will constitute a valid transfer to the
Trust of all interest of each of the Sellers in the Additional
Balances, all proceeds of the Additional Balances, and all other
property specified in Section 2.01(a) of the Sale and Servicing
Agreement relating to the Additional Balances free of all liens
and other encumbrances, and the Indenture constitutes a valid
Grant of a Security Interest to the Indenture Trustee in that
property, and the Indenture Trustee has a first priority
perfected Security Interest in the property, subject to the
effect of Section 9-315 of the UCC with respect to collections
on the Mortgage Loans that are deposited in the Collection
Account in accordance with the next to last paragraph of Section
3.02(b) of the Sale and Servicing Agreement, or
(B) this Agreement or the Sale and Servicing Agreement, as
appropriate, constitutes a Grant of a Security Interest to the
Owner Trustee on behalf of the Trust and the Indenture
constitutes a Grant of a Security Interest to the Indenture
Trustee in the property described in clause (A) above. If this
Agreement and the Sale and Servicing Agreement constitute the
Grant of a Security Interest to the Trust and the Indenture
constitutes a Grant of a Security Interest to the Indenture
Trustee in such property, the Indenture Trustee will have a
first priority perfected Security Interest in the property,
subject to the effect of Section 9-315 of the UCC with respect
to collections on the Mortgage Loans that are deposited in the
Collection Account in accordance with the next to last paragraph
of Section 3.02(b) of the Sale and Servicing Agreement. This
Security Interest is enforceable as such against creditors of
and purchasers from the Trust, the Purchaser, and each of the
Sellers.
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(3) CHL has not authorized the filing of and is not aware of
any financing statements against any Seller that include a
description of collateral covering the Collateral other than any
financing statement (A) relating to the Security Interests granted to
the Depositor, the Trust, or the Indenture Trustee under this
Agreement, pursuant to the Sale and Servicing Agreement, or pursuant
to the Indenture, (B) that has been terminated, or (C) that names the
Depositor, the Trust, or the Indenture Trustee as secured party.
(4) As of the Closing Date, the information in the Mortgage
Loan Schedule for the Mortgage Loans is correct in all material
respects. As of the applicable date of substitution for an Eligible
Substitute Mortgage Loan, the information with respect to the
Eligible Substitute Mortgage Loan in the Mortgage Loan Schedule is
correct in all material respects. As of the date any Additional
Balance is created, the information as to the Mortgage Loan
identification number and the Additional Balance of that Mortgage
Loan reported for inclusion in the Mortgage Loan Schedule is correct
in all material respects.
(5) The Mortgage Loans have not been assigned or pledged, and
the related Seller is their sole owner and holder free of any liens,
claims, encumbrances, participation interests, equities, pledges,
charges, or Security Interests of any nature, and has full authority,
under all governmental and regulatory bodies having jurisdiction over
the ownership of the Mortgage Loans, to transfer them pursuant to
this Agreement.
(6) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), the
related Mortgage Note and the mortgage for each Mortgage Loan have
not been assigned or pledged, and immediately before the sale of the
Mortgage Loans to the Purchaser, the related Seller was the sole
owner and holder of the Mortgage Loan free of any liens, claims,
encumbrances, participation interests, equities, pledges, charges, or
Security Interests of any nature, and has full authority, under all
governmental and regulatory bodies having jurisdiction over the
ownership of the Mortgage Loans, to transfer it pursuant to this
Agreement.
(7) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), the
related mortgage is a valid and subsisting first or second lien on
the property described in it, as shown on the Mortgage Loan Schedule,
and as of the Cut-off Date or date of substitution, as applicable,
the related Mortgaged Property is free of all encumbrances and liens
having priority over the first or second lien, as applicable, of the
mortgage except for liens for
(A) real estate taxes and special assessments not yet
delinquent;
(B) any first mortgage loan secured by the Mortgaged
Property and specified on the Mortgage Loan Schedule;
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(C) covenants, conditions and restrictions, rights of way,
easements, and other matters of public record as of the date of
recording that are acceptable to mortgage lending institutions
generally; and
(D) other matters to which like properties are commonly
subject that do not materially interfere with the benefits of
the security intended to be provided by the mortgage.
(8) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), no
obligor has a valid offset, defense, or counterclaim under any Credit
Line Agreement or mortgage.
(9) To the best knowledge of CHL, as of the Closing Date (or,
with respect to any Eligible Substitute Mortgage Loan, the applicable
date of substitution), no related Mortgaged Property has any
delinquent recording or other tax or fee or assessment lien or
governmental charge against it, other than those that have been paid
by the Seller.
(10) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), no
proceeding is pending or, to the best knowledge of CHL, threatened
for the total or partial condemnation of the related Mortgaged
Property, and the property is free of material damage and is in good
repair.
(11) To the best knowledge of CHL, as of the Closing Date (or,
with respect to any Eligible Substitute Mortgage Loan, the applicable
date of substitution), no mechanics' or similar liens or claims have
been filed for work, labor, or material affecting the related
Mortgaged Property that are, or may be, liens prior or equal to the
lien of the related mortgage, except liens that are fully insured
against by the title insurance policy referred to in clause (16).
(12) No Minimum Monthly Payment on a Mortgage Loan being
transferred on the Closing Date is more than 59 days delinquent
(measured on a contractual basis) and no Minimum Monthly Payment on
any other Mortgage Loan subsequently being transferred is more than
30 days delinquent (measured on a contractual basis) on the relevant
transfer date and for each Loan Group no more than the applicable
percentage of the Mortgage Loans in that Loan Group specified in the
Adoption Annex being transferred on the Closing Date (by Cut-off Date
Loan Balance) were 30-59 days delinquent (measured on a contractual
basis).
(13) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), the
Mortgage File for each Mortgage Loan contains each of the documents
specified to be included in it.
(14) At origination, each Mortgage Loan and the related
Mortgage Note complied in all material respects with applicable
local, state, and federal laws, including all applicable predatory
and abusive lending laws, usury, truth-in-lending, real estate
12
settlement procedures, consumer credit protection, equal credit
opportunity, or disclosure laws applicable to the Mortgage Loan, and
the servicing practices used by the Master Servicer with respect to
each Mortgage Loan have been consistent with the practices and the
degree of skill and care the Master Servicer exercises in servicing
for itself loans that it owns that are comparable to the Mortgage
Loans.
(15) As of the Closing Date, (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), no
Mortgage Loan is a High Cost Loan or Covered Loan, as applicable, and
no Mortgage Loan originated on or after October 1, 2002 through March
6, 2003 is governed by the Georgia Fair Lending Act; and "High Cost
Loan" and "Covered Loan" have the meaning assigned to them in the
Standard & Poor's LEVELS(R) Glossary attached as Schedule II (the
"Glossary") where
(x) a "High Cost Loan" is each loan identified in
the column "Category under applicable anti-predatory lending
law" of the table entitled "Standard & Poor's High Cost Loan
Categorization" in the Glossary as each such loan is defined
in the applicable anti-predatory lending law of the state or
jurisdiction specified in such table and
(y) "Covered Loan" is each loan identified in the
column "Category under applicable anti-predatory lending
law" of the table entitled "Standard & Poor's Covered Loan
Categorization" in the Glossary as each such loan is defined
in the applicable anti-predatory lending law of the state or
jurisdiction specified in such table.
(16) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution),
either a lender's title insurance policy or binder was issued or a
guaranty of title customary in the relevant jurisdiction was
obtained, on the date of origination of the Mortgage Loan being
transferred on the relevant date and each policy is valid and remains
in full force.
(17) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), none
of the Mortgaged Properties is a mobile home or a manufactured
housing unit that is not considered or classified as part of the real
estate under the laws of the jurisdiction in which it is located.
(18) No more than the percentage specified in the Adoption
Annex of the Mortgage Loans in each Loan Group, by aggregate
principal balance of the related Mortgage Loans, are secured by
Mortgaged Properties located in one United States postal zip code.
(19) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), the
Combined Loan-to-Value Ratio
13
for each Mortgage Loan in each Loan Group was not in excess of the
percentage specified in the Adoption Annex.
(20) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), no
selection procedure reasonably believed by CHL to be adverse to the
interests of the Transferor, the Noteholders, or the Credit Enhancer
was used in selecting the Mortgage Loans.
(21) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), no
Seller has transferred the Mortgage Loans to the Trust with any
intent to hinder, delay, or defraud any of its creditors.
(22) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), the
Minimum Monthly Payment with respect to any Mortgage Loan is not less
than the interest accrued at the applicable Loan Rate on the average
daily Asset Balance during the interest period relating to the date
on which the Minimum Monthly Payment is due.
(23) The Mortgage Notes constitute either "instruments" or
"general intangibles" as defined in the UCC.
(24) By the Closing Date (or, within 30 days of the applicable
date of substitution with respect to any Eligible Substitute Mortgage
Loan), the Sponsor will file UCC1 financing statements in the proper
filing office in the appropriate jurisdiction to perfect the Security
Interest in the Collateral Granted under the Indenture.
(25) The Mortgage Notes that constitute or evidence the
Collateral do not have any marks or notations indicating that they
have been pledged, assigned, or otherwise transferred to any person
other than the Purchaser, the Trust, or the Indenture Trustee. All
financing statements filed or to be filed against each Seller in
favor of the Purchaser, the Trust, or the Indenture Trustee in
connection with this Agreement, the Sale and Servicing Agreement, or
the Indenture describing the Collateral contain a statement to the
following effect: "A purchase of the Mortgage Loans included in the
collateral covered by this financing statement will violate the
rights of the Purchaser, the Trust, or the Indenture Trustee."
(26) As of the Closing Date, each of CHL, CLFT, and Park Monaco
will have received a written acknowledgement from the Custodian that
is acting solely as agent of the Indenture Trustee.
(27) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), each
Credit Line Agreement and each Mortgage Loan is an enforceable
obligation of the related mortgagor.
14
(28) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution). No
Seller has received a notice of default of any senior mortgage loan
related to a Mortgaged Property that has not been cured by a party
other than the Master Servicer.
(29) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), the
definition of "prime rate" in each Credit Line Agreement relating to
a Mortgage Loan does not differ materially from "the highest `prime
rate' as published in the `Money Rates' table of The Wall Street
Journal as of the first business day of the calendar month for the
applicable interest rate adjustment date."
(30) The weighted average remaining term to maturity of the
Mortgage Loans in each Loan Group on a contractual basis as of the
Cut-off Date is approximately the number of months specified for that
Loan Group in the Adoption Annex. On each date that the Loan Rates
have been adjusted, interest rate adjustments on the Mortgage Loans
were made in compliance with the related mortgage and Mortgage Note
and applicable law. Over the term of each Mortgage Loan, the Loan
Rate may not exceed the related Loan Rate Cap. The Loan Rate Cap for
the Mortgage Loans ranges between the percentages specified in the
Adoption Annex for that Loan Group and the weighted average Loan Rate
Cap is approximately the percentage specified in the Adoption Annex
for that Loan Group. The Gross Margins for the Mortgage Loans in each
Loan Group range between the percentages specified in the Adoption
Annex for that Loan Group and the weighted average Gross Margin is
approximately the percentage specified in the Adoption Annex for that
Loan Group as of the Cut-off Date. The Loan Rates on the Mortgage
Loans in each Loan Group range between the percentages specified in
the Adoption Annex for that Loan Group and the weighted average Loan
Rate on the Mortgage Loans is approximately the percentage specified
in the Adoption Annex for that Loan Group.
(31) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), each
Mortgaged Property consists of a single parcel of real property with
a one-to-four unit single family residence erected on it, or an
individual condominium unit, planned unit development unit, or
townhouse.
(32) No more than the percentage specified in the Adoption
Annex (by Cut-off Date Loan Balance) for each Loan Group of the
Mortgage Loans in the related Loan Group are secured by real property
improved by individual condominium units, units in planned unit
developments, townhouses, or two-to-four family residences erected on
them, and at least the percentage specified in the Adoption Annex (by
Cut-off Date
15
Loan Balance) for each Loan Group of the Mortgage Loans in the
related Loan Group are secured by real property with a detached
one-family residence erected on them.
(33) The Credit Limits on the Mortgage Loans in each Loan Group
range between approximately the dollar amounts specified in the
Adoption Annex for that Loan Group with an average of approximately
the dollar amount specified in the Adoption Annex for that Loan
Group. As of the Cut-off Date, no Mortgage Loan in either Loan Group
had a principal balance in excess of approximately the dollar amount
specified in the Adoption Annex for that Loan Group and the average
principal balance of the Mortgage Loans in each Loan Group is equal
to approximately the dollar amounts specified in the Adoption Annex
for that Loan Group.
(34) Approximately the percentages specified in the Adoption
Annex of the Mortgage Loans, by aggregate principal balance as of the
Cut-off Date, are secured by first and second liens.
(35) As of the Closing Date, no more than the percentage
specified in the Adoption Annex for each Loan Group of the Mortgage
Loans in the related Loan Group, by aggregate principal balance, were
appraised electronically.
(36) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), no
default exists under any Mortgage Note or Mortgage Loan and no event
that, with the passage of time or with notice and the expiration of
any grace or cure period, would constitute a default under any
Mortgage Note or Mortgage Loan has occurred and been waived. As of
the Closing Date (or, with respect to any Eligible Substitute
Mortgage Loan, the applicable date of substitution), no modifications
to the Mortgage Notes and Mortgage Loans have been made and not
disclosed in the Mortgage Files.
(37) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), each
Mortgage Loan was originated in accordance with the Sponsor's
underwriting guidelines and the Sponsor had no knowledge of any fact
that would have caused a reasonable originator of mortgage loans to
conclude on the date of origination of each Mortgage Loan that each
such Mortgage Loan would not be paid in full when due.
(38) To the best knowledge of CHL at the time of origination of
each Mortgage Loan, no improvement located on or being part of the
Mortgaged Property was in violation of any applicable zoning and
subdivision laws or ordinances.
(39) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), any
leasehold estate securing a Mortgage Loan has a term of not less than
five years in excess of the term of the related Mortgage Loan.
16
(40) Based on the drawn balances of the Mortgage Loans, the
Mortgage Loans had the characteristics set out in the Adoption Annex
for each Loan Group in respect of the following: weighted average
Combined Loan-to-Value Ratio; range of Combined Loan-to-Value Ratios;
percentage of primary residences; weighted average FICO score; range
of FICO scores; Weighted Average Net Loan Rate; range of net Loan
Rates; weighted average original stated term to maturity; range of
original term to maturity; range of remaining term to maturity;
average drawn balance; weighted average utilization ratio; and
percentage of the Mortgage Loans that have their respective Mortgaged
Properties located in the top five states, measured by aggregate
drawn balances.
(41) Any Mortgage Loan that has been modified in any manner has
been so modified in accordance with the policies and procedures of
the Master Servicer and in a manner that was permitted by the Sale
and Servicing Agreement, the Indenture, and any other Transaction
Document.
(42) Each Mortgage Loan was originated (within the meaning of
Section 3(a)(41) of the Securities Exchange Act of 1934) by an entity
that satisfied at the time of origination the requirements of Section
3(a)(41) of the Securities Exchange Act of 1934.
(43) At the time each Mortgage Loan was originated, each Seller
was, and each Seller is an approved seller of conventional mortgage
loans for Xxxxxx Xxx and Xxxxxxx Mac and is a mortgagee approved by
the Secretary of Housing and Urban Development pursuant to Sections
203 and 211 of the National Housing Act.
(44) A lender's policy of title insurance together with a
condominium endorsement and extended coverage endorsement, if
applicable, in an amount at least equal to the principal balance of
the related Mortgage Loan as of the Cut-off Date or a commitment
(binder) to issue the same was effective on the date of the
origination of each Mortgage Loan, each such policy is valid and
remains in full force, and each such policy was issued by a title
insurer qualified to do business in the jurisdiction where the
Mortgaged Property is located and acceptable to Xxxxxx Mae and
Xxxxxxx Mac and is in a form acceptable to Xxxxxx Mae and Xxxxxxx
Mac, which policy insures the Sponsor and successor owners of
indebtedness secured by the insured Mortgage, as to the first
priority lien, of the Mortgage subject to the exceptions in paragraph
(7) above.
(45) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution) the
improvements on each Mortgaged Property are covered by a valid and
existing hazard insurance policy with a generally acceptable carrier
that provides for fire and extended coverage and coverage for such
other hazards as are customary in the area where the Mortgaged
Property is
17
located in an amount that is at least equal to the lesser of (i) the
maximum insurable value of the improvements securing the Mortgage
Loan or (ii) the greater of (a) the outstanding principal balance of
the Mortgage Loan and (b) an amount such that the proceeds of the
policy will be sufficient to prevent the Mortgagor or the mortgagee
from becoming a co-insurer. If the Mortgaged Property is a
condominium unit, it is included under the coverage afforded by a
blanket policy for the condominium unit. All such individual
insurance policies and all flood policies referred to in item (46)
below contain a standard mortgagee clause naming the Sponsor or the
original mortgagee, and its successors in interest, as mortgagee, and
the Sponsor has received no notice that any premiums due and payable
thereon have not been paid, and the Mortgage obligates the Mortgagor
thereunder to maintain all such insurance, including flood insurance,
at the Mortgagor's expense, and upon the Mortgagor's failure to do
so, authorizes the holder of the Mortgage to obtain and maintain such
insurance at the Mortgagor's expense and to seek reimbursement
therefor from the Mortgagor.
(46) If the Mortgaged Property is in an area identified in the
Federal Register by the Federal Emergency Management Agency as having
special flood hazards, a flood insurance policy in a form meeting the
requirements of the current guidelines of the Flood Insurance
Administration is in effect with respect to the Mortgaged Property
with a generally acceptable carrier in an amount representing
coverage not less than the least of (A) the outstanding principal
balance of the Mortgage Loan and any mortgage loan senior to that
Mortgage Loan from time to time, (B) the minimum amount required to
compensate for damage or loss on a replacement cost basis, or (C) the
maximum amount of insurance that is available under the National
Flood Insurance Act of 1968.
(47) Each Mortgage Note and the related Mortgage are genuine,
and each is the valid and legally binding obligation of its maker,
enforceable in accordance with its terms and under applicable law,
except that (a) its enforceability may be limited by bankruptcy,
insolvency, moratorium, receivership, and other similar laws relating
to creditors' rights generally and (b) the remedy of specific
performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion of the court
before which any proceeding therefor may be brought. To the best of
CHL's knowledge, all parties to the Mortgage Note and the Mortgage
had legal capacity to execute the Mortgage Note and the Mortgage and
each Mortgage Note and Mortgage have been duly and properly executed
by such parties.
(48) No Mortgage Loan has a shared appreciation feature, or
other contingent interest feature.
(49) To the best of CHL's knowledge, all of the improvements
that were included for the purpose of determining the appraised value
of the Mortgaged Property
18
lie wholly within the boundaries and building restriction lines of
the Mortgaged Property, and no improvements on adjoining properties
encroach on the Mortgaged Property.
(50) To the best of CHL's knowledge, 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 certificates of occupancy
and fire underwriting certificates, have been made or obtained from
the appropriate authorities, unless their lack would not have a
material adverse effect on the value of the Mortgaged Property, and
the Mortgaged Property is lawfully occupied under applicable law.
(51) Each Mortgage contains customary and enforceable
provisions that render the rights and remedies of its holder adequate
for the realization against the Mortgaged Property of the benefits of
the security intended to be provided by it, including, (i) in the
case of a Mortgage designated as a deed of trust, by trustee's sale,
and (ii) otherwise by judicial foreclosure.
(52) Before the approval of the Mortgage Loan application, an
appraisal of the related Mortgaged Property was obtained from a
qualified appraiser, duly appointed by the Sponsor, who had no
interest, direct or indirect, in the Mortgaged Property or in any
loan secured by the Mortgaged Property, and whose compensation is not
affected by the approval or disapproval of the Mortgage Loan.
(53) Except for (A) payments in the nature of escrow payments,
and (B) interest accruing from the date of the Mortgage Note or date
of disbursement of the Mortgage proceeds, whichever is later, to the
day that precedes by one month the Due Period of the first
installment of principal and interest and taxes and insurance
payments, the Sponsor 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 by the Mortgage.
(54) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution) no
foreclosure proceedings are pending against any Mortgaged Property
and no Mortgage Loan is subject to any pending bankruptcy or
insolvency proceeding.
(55) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), there
is no homestead exemption available and enforceable that materially
interferes with the right to sell any Mortgaged Property at a
trustee's sale or the right to foreclose the related Mortgage.
(56) No borrower was required to purchase any single premium
credit insurance policy (e.g., life, disability, accident,
unemployment, or health insurance product) or
19
debt cancellation agreement as a condition of obtaining the extension
of credit. No borrower obtained a prepaid single-premium credit
insurance policy (e.g., life, disability, 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 debt cancellation agreements as part of the origination of,
or as a condition to closing, the Mortgage Loan.
(57) The Mortgage Loans, individually and in the aggregate,
conform in all material respects to their descriptions in the
Prospectus Supplement.
(58) No Mortgage Loan is covered by the Home Ownership and
Equity Protection Act of 1994.
(59) No Mortgage Loan originated on or after October 1, 2002
and before March 7, 2003 is secured by Mortgaged Property located in
the State of Georgia.
(60) As of the Closing Date (or, with respect to any Eligible
Substitute Mortgage Loan, the applicable date of substitution), no
Mortgage Loan is classified as (1) a "high cost" loan under the Home
Ownership and Equity Protection Act of 1994 or (2) a "high cost,"
"threshold," "covered," "predatory," or similar loan under any other
applicable state, federal, or local law that applies to mortgage
loans (or a similar 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, or fees).
(61) No proceeds from any Mortgage Loan were used to purchase
single premium credit insurance policies as part of the origination
of, or as a condition to closing, the Mortgage Loan.
(62) No subprime Mortgage Loan originated on or after October
1, 2002 will impose a prepayment premium after the third anniversary
of the Mortgage Loan. No subprime Mortgage Loan originated before
October 1, 2002, and no non-subprime Mortgage Loan, will impose a
prepayment penalty after the fifth anniversary of the Mortgage Loan.
(63) The servicer for each Mortgage Loan has fully furnished,
in accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (i.e., favorable and
unfavorable) on its borrower credit files to Equifax, Experian, and
Trans Union Credit Information Company on a monthly basis.
(64) All of the Mortgage Loans in the Loan Group specified in
the Adoption Annex conform to Xxxxxx Xxx or Xxxxxxx Mac maximum
principal balance (by credit limit) guidelines.
(65) With respect to all of the Mortgage Loans in Loan Group 1
originated from August 1, 2004 through April 30, 2005, if the related
Mortgage Loan or the related
20
Mortgage Note, or any document relating to the loan transaction,
contains a mandatory arbitration clause (that is, a clause that
requires the borrower to submit to arbitration to resolve any dispute
arising out of or relating in any way to the mortgage loan
transaction), CHL will (i) notify the related borrower in writing
within 60 days after the Closing Date that none of the related
seller, the related servicer or any subsequent party that acquires an
interest in the Mortgage Loan or services the Mortgage Loan will
enforce the arbitration clause against the borrower, but that the
borrower will continue to have the right to submit a dispute to
arbitration, and (ii) place a copy of that notice in the Mortgage
File.
(b) If the substance of any representation or warranty under the Sale
and Servicing Agreement or in this Section made to the best of CHL's knowledge
or as to which a Seller has no knowledge is inaccurate and the inaccuracy
materially and adversely affects the interest of the Purchaser or its assignee
in the related Mortgage Loan, then, notwithstanding that the Seller did not
know the substance of the representation and warranty was inaccurate at the
time the representation or warranty was made, the inaccuracy shall be a breach
of the applicable representation or warranty and CHL shall cure the breach,
repurchase the Mortgage Loan, or substitute for the Mortgage Loan in
accordance with the Sale and Servicing Agreement.
(c) The representations and warranties in this Section shall survive
the transfer and assignment of the Mortgage Loans to the Purchaser. The sole
remedy of the Purchaser, the Noteholders, the Indenture Trustee on behalf of
Noteholders, and the Credit Enhancer against a Seller for the breach of a
representation or warranty is CHL's obligation to accept a transfer of a
Mortgage Loan as to which a breach has occurred and is continuing and to make
any required deposit in the Collection Account or to substitute an Eligible
Substitute Mortgage Loan.
(d) The Purchaser acknowledges that CHL, as Master Servicer, in its
sole discretion, may purchase for its own account from the Trust any Mortgage
Loan that is 151 days or more delinquent. The price for any Mortgage Loan
purchased shall be calculated in the same manner as in Section 3.06 of the
Sale and Servicing Agreement and shall be deposited in the Collection Account.
When it receives a certificate from the Master Servicer in the form of Exhibit
D to the Sale and Servicing Agreement, the Trust shall release to the
purchaser of the Mortgage Loan the related Mortgage File and shall execute and
deliver any instruments of transfer prepared by the purchaser of the Mortgage
Loan, without recourse, necessary to vest in the purchaser of the Mortgage
Loan any Mortgage Loan released pursuant to this Agreement, and the purchaser
of the Mortgage Loan shall succeed to all the Trust's interest in the Mortgage
Loan and all security and documents. This assignment shall be an assignment
outright and not for security. The purchaser of the Mortgage Loan shall then
own the Mortgage Loan, and all security and
21
documents, free of any further obligation to the Trust, the Owner Trustee, the
Indenture Trustee, the Transferor, the Credit Enhancer, or the Noteholders
with respect to it.
(e) A breach of any one of the representations in Sections
3.02(a)(58) to (65) will be considered to materially adversely affect the
interests of the Noteholders.
ARTICLE IV
SELLERS' COVENANTS
Section 4.01. Covenants of the Sellers.
Except for the transfer under this Agreement, none of the Sellers
will transfer to any other person, or create or suffer to exist any Lien on
any Mortgage Loan, or any interest in one; each Seller will notify the
Indenture Trustee of the existence of any Lien on any Mortgage Loan
immediately on its discovery; and CHL will defend the right, title, and
interest of the Trust and the Indenture Trustee in the Mortgage Loans against
all claims of third parties claiming through a Seller. Nothing in this Section
shall prohibit a Seller from suffering to exist on any of the Mortgage Loans
any Liens for municipal or other local taxes and other governmental charges if
they are not due at the time or if the applicable Seller is contesting their
validity in good faith by appropriate proceedings and set aside on its books
adequate reserves with respect to them.
ARTICLE V
SERVICING
Section 5.01. Servicing.
CHL will be the Master Servicer of the Mortgage Loans pursuant to the
Sale and Servicing Agreement.
ARTICLE VI
TERMINATION
Section 6.01. Termination.
The respective obligations of each of the Sellers and the Purchaser
created by this Agreement shall terminate when the Indenture terminates in
accordance with its terms.
22
ARTICLE VII
MISCELLANEOUS PROVISIONS
Section 7.01. Amendment.
This Agreement may be amended from time to time by CHL, CLFT, Park
Monaco, and the Purchaser, with the written consent of the Credit Enhancer, by
written agreement signed by CHL, CLFT, Park Monaco, and the Purchaser.
Section 7.02. Governing Law.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS PROVISIONS THAT
WOULD RESULT IN THE APPLICATION OF THE LAWS OF ANOTHER STATE.
Section 7.03. Notices.
All notices, demands, instructions, consents, and other
communications required or permitted under this Agreement shall be in writing
and signed by the party giving the same and shall be personally delivered or
sent by first class or express mail (postage prepaid), national overnight
courier service, or by facsimile transmission or other electronic
communication device capable of transmitting or creating a written record
(confirmed by first class mail) and shall be considered to be given for
purposes of this Agreement on the day that the writing is delivered when
personally delivered or sent by facsimile or overnight courier or three
Business Days after it was sent to its intended recipient if sent by first
class mail. A facsimile has been delivered when the sending machine issues an
electronic confirmation of transmission. Unless otherwise specified in a
notice sent or delivered in accordance with the provisions of this Section,
notices, demands, instructions, consents, and other communications in writing
shall be given to or made on the respective parties at their respective
addresses indicated below:
(i) if to CHL at:
Countrywide Home Loans, Inc.
0000 Xxxx Xxxxxxx
Xxxxxxxxx, XX 00000
Ref: CWHEQ 2005-D
(ii) if to CLFT
Countyrwide LFT LLC
0000 Xxxx Xxxxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Ref: CWHEQ 2005-D
(iii) if to Park Monaco
23
Park Monaco Inc.
0000 Xxxx Xxxxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Ref: CWHEQ 2005-D
and
(iv) if to the Purchaser at:
CWHEQ, Inc.
0000 Xxxx Xxxxxxx
Xxxxxxxxx, XX 00000
Ref: CWHEQ 2005-D
Section 7.04. Severability of Provisions.
Any provisions of this Agreement that are held invalid for any reason
or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of the invalidity or unenforceability without
invalidating the remaining provisions of this Agreement, and the prohibition
or unenforceability in a jurisdiction shall not invalidate or render
unenforceable that provision in any other jurisdiction.
Section 7.05. Counterparts; Electronic Delivery.
This Agreement may be executed in any number of copies, and by the
different parties on the same or separate counterparts, each of which shall be
considered to be an original instrument. Any signature page to this Agreement
containing a manual signature may be delivered by facsimile transmission or
other electronic communication device capable of transmitting or creating a
printable written record, and when so delivered shall have the effect of
delivery of an original manually signed signature page.
Section 7.06. Further Agreements.
The Purchaser and each Seller agree to execute and deliver to the
other any additional documents appropriate to effectuate the purposes of this
Agreement or in connection with the issuance of the Notes.
Section 7.07. Successors and Assigns: Assignment of Purchase
Agreement.
This Agreement shall bind and inure to the benefit of and be
enforceable by each Seller, the Purchaser, the Trust, the Indenture Trustee,
and the Credit Enhancer. The obligations of each Seller under this Agreement
cannot be assigned or delegated to a third party without the consent of the
Purchaser and the Credit Enhancer, except that either Seller may assign its
obligations under this Agreement to any person into which that Seller is
merged or any corporation resulting from any merger, conversion, or
consolidation to which that Seller is a party or any person succeeding to the
business of that Seller. The Purchaser is acquiring the Mortgage Loans to
further transfer them to the Trust, and the Trust will Grant a Security
24
Interest in them to the Indenture Trustee under the Indenture pursuant to
which the Trust will issue a series of Notes secured by the Mortgage Loans. As
an inducement to the Purchaser to purchase the Mortgage Loans, each Seller
consents to the assignment by the Purchaser to the Trust, and by the Trust to
the Indenture Trustee of all of the Purchaser's rights against it under this
Agreement insofar as they relate to the Mortgage Loans transferred to the
Trust applicable to that Seller and to the enforcement or exercise of any
right against that Seller pursuant to this Agreement by the Indenture Trustee
under the Sale and Servicing Agreement and the Indenture. Enforcement of a
right by the Indenture Trustee shall have the same effect as if the right had
been exercised by the Purchaser directly.
Section 7.08. Survival.
The representations and warranties in Article III shall survive the
purchase of the Mortgage Loans.
25
IN WITNESS WHEREOF, the Sellers and the Purchaser have caused this
Agreement to be duly executed by their respective officers as of the day and
year first above written.
CWHEQ, INC.
as Purchaser
By: /s/ Xxxx Xxxxxxx, Xx.
---------------------
Name: Xxxx Xxxxxxx, Xx.
Title: Vice President
COUNTRYWIDE HOME LOANS, INC.
as a Seller
By: /s/ Xxxx Xxxxxxx, Xx.
---------------------
Name: Xxxx Xxxxxxx, Xx.
Title: Senior Vice President
COUNTRYWIDE LFT LLC
as a Seller
By: /s/ Xxxx Xxxxxxx, Xx.
---------------------
Name: Xxxx Xxxxxxx, Xx.
Title: Senior Vice President
PARK MONACO INC.
as a Seller
By: /s/ Xxxx Xxxxxxx, Xx.
---------------------
Name: Xxxx Xxxxxxx, Xx.
Title: Senior Vice President
26
STATE OF CALIFORNIA)
) ss.:
COUNTY OF LOS ANGELES)
On the 30th day of August, 2005 before me, a Notary Public in and for
said State, personally appeared Xxxx Xxxxxxx, Xx., known to me to be a Vice
President of CWHEQ, Inc., the corporation that executed the within instrument,
and also known to me to be the person who executed it on behalf of said
corporation, and acknowledged to me that such corporation executed the within
instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ Xxxxxx X. Xxxxxx
---------------------
Notary Public
Xxxxxx X. Xxxxxx
Commission # 1325392
Notary Public - California
Los Angeles County
My Comm. Expires October 15, 2005.
27
STATE OF CALIFORNIA )
) ss.:
COUNTY OF LOS ANGELES )
On the 30th day of August, 2005 before me, Xxxx Xxxxxxx, Xx. of
Countrywide Home Loans, Inc., personally appeared, personally known to me (or
proved to me on the basis of satisfactory evidence) to be the person whose
name is subscribed to the within instrument and acknowledged to me that he
executed the same in his authorized capacity, and that by his signature on the
instrument the person, or the entity on behalf of which the person acted,
executed the instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ Xxxxxx X. Xxxxxx
---------------------
Notary Public
Xxxxxx X. Xxxxxx
Commission # 1325392
Notary Public - California
Los Angeles County
My Comm. Expires October 15, 2005.
28
STATE OF CALIFORNIA )
) ss.:
COUNTY OF LOS ANGELES )
On the 30th day of August, 2005 before me, Xxxx Xxxxxxx, Xx. of
COUNTRYWIDE LFT LLC, personally appeared, personally known to me (or proved to
me on the basis of satisfactory evidence) to be the person whose name is
subscribed to the within instrument and acknowledged to me that he executed
the same in his authorized capacity, and that by his signature on the
instrument the person, or the entity on behalf of which the person acted,
executed the instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ Xxxxxx X. Xxxxxx
---------------------
Notary Public
Xxxxxx X. Xxxxxx
Commission # 1325392
Notary Public - California
Los Angeles County
My Comm. Expires October 15, 2005.
29
STATE OF CALIFORNIA )
) ss.:
COUNTY OF LOS ANGELES )
On the 30th day of August, 2005 before me, Xxxx Xxxxxxx, Xx. of PARK
MONACO INC., personally appeared, personally known to me (or proved to me on
the basis of satisfactory evidence) to be the person whose name is subscribed
to the within instrument and acknowledged to me that he executed the same in
his authorized capacity, and that by his signature on the instrument the
person, or the entity on behalf of which the person acted, executed the
instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ Xxxxxx X. Xxxxxx
---------------------
Notary Public
Xxxxxx X. Xxxxxx
Commission # 1325392
Notary Public - California
Los Angeles County
My Comm. Expires October 15, 2005.
30
SCHEDULE I
SCHEDULE OF
MORTGAGE LOANS
[Delivered to the Indenture Trustee only]
Sch-I-1
SCHEDULE II
STANDARD & POOR'S GLOSSARY
Standard & Poor's Predatory Lending Categorization
Standard & Poor's has categorized loans governed by anti-predatory lending
laws in the jurisdictions listed below into three categories based on a
combination of factors that include (a) the risk exposure associated with the
assignee liability and (b) the tests and thresholds set forth in those laws.
Note that certain loans classified by the relevant statute as Covered are
included in Standard & Poor's High Cost Loan category because they included
thresholds and tests that are typical of what is generally considered High
Cost by the industry.
------------------------------------------------------------------------------------------------------------------------
Standard & Poor's High-Cost Loan Categorization
------------------------------------------------------------------------------------------------------------------------
State/jurisdiction Category under applicable anti-predatory lending law
------------------------------------------------------------------------------------------------------------------------
Arkansas High Cost Home Loan
------------------------------------------------------------------------------------------------------------------------
Cleveland Heights, Ohio Covered Loan
------------------------------------------------------------------------------------------------------------------------
Colorado Covered Loan
------------------------------------------------------------------------------------------------------------------------
Connecticut High Cost Home Loan
------------------------------------------------------------------------------------------------------------------------
District of Columbia Covered Loan
------------------------------------------------------------------------------------------------------------------------
Florida High Cost Home Loan
------------------------------------------------------------------------------------------------------------------------
Georgia (Oct. 1, 2002 - March 6, 2003) High Cost Home Loan
------------------------------------------------------------------------------------------------------------------------
Georgia as amended (March 7, 2003 - current) High Cost Home Loan
------------------------------------------------------------------------------------------------------------------------
HOEPA Section 32 High Cost Loan
------------------------------------------------------------------------------------------------------------------------
Illinois High Risk Home Loan
------------------------------------------------------------------------------------------------------------------------
Kansas High Loan-to-Value Consumer Loans and High APR Consumer Loans
------------------------------------------------------------------------------------------------------------------------
Kentucky High Cost Home Loan
------------------------------------------------------------------------------------------------------------------------
Los Angeles, Calif. High Cost Refinance Home Loan
------------------------------------------------------------------------------------------------------------------------
Maine High Rate High Fee mortgage
------------------------------------------------------------------------------------------------------------------------
Massachusetts High Cost Home Loan
------------------------------------------------------------------------------------------------------------------------
Nevada Home Loan
------------------------------------------------------------------------------------------------------------------------
New Jersey High Cost Home Loan
------------------------------------------------------------------------------------------------------------------------
New York High Cost Home Loan
------------------------------------------------------------------------------------------------------------------------
New Mexico High Cost Home Loan
------------------------------------------------------------------------------------------------------------------------
North Carolina High Cost Home Loan
------------------------------------------------------------------------------------------------------------------------
Oakland, Calif. High Cost Home Loan
------------------------------------------------------------------------------------------------------------------------
Ohio Covered Loan
------------------------------------------------------------------------------------------------------------------------
Oklahoma Subsection 10 Mortgage
------------------------------------------------------------------------------------------------------------------------
South Carolina High Cost Home Loan
------------------------------------------------------------------------------------------------------------------------
West Virginia West Virginia Mortgage Loan Act Loan
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
Standard & Poor's Covered Loan Categorization
------------------------------------------------------------------------------------------------------------------------
State/jurisdiction Category under applicable anti-predatory lending law
------------------------------------------------------------------------------------------------------------------------
Georgia (Oct. 1, 2002 - March 6, 2003) Covered Loan
------------------------------------------------------------------------------------------------------------------------
New Jersey Covered Home Loan
------------------------------------------------------------------------------------------------------------------------
Sch-II-1
------------------------------------------------------------------------------------------------------------------------
Standard & Poor's Home Loan Categorization
------------------------------------------------------------------------------------------------------------------------
State/jurisdiction Category under applicable anti-predatory lending law
------------------------------------------------------------------------------------------------------------------------
Georgia (Oct. 1, 2002- March 6, 2003) Home Loan
------------------------------------------------------------------------------------------------------------------------
New Jersey Home Loan
------------------------------------------------------------------------------------------------------------------------
New Mexico Home Loan
------------------------------------------------------------------------------------------------------------------------
North Carolina Consumer Home Loan
------------------------------------------------------------------------------------------------------------------------
Oakland, Calif. Home Loan
------------------------------------------------------------------------------------------------------------------------
South Carolina Consumer Home Loan
------------------------------------------------------------------------------------------------------------------------
Sch-II-2
ANNEX 1
ANNEX 1
ADOPTION ANNEX
The purchase price for the Mortgage Loans pursuant to Section 2.03 is
the transfer to each of the Sellers on the Closing Date of the Transferor
Certificates and the proceeds from the sale of the Notes, each by its
respective portion.
The items referred to in the representations and warranties in
Section 3.02 are:
(12) 0.00% and 0.00% of the Mortgage Loans in Loan Group 1 and Loan
Group 2, respectively, being transferred on the relevant date (by Cut-off Date
Loan Balance) were 30-59 days delinquent (measured on a contractual basis).
(18) As of the Cut-off Date no more than 3.00% and 3.00% of the
Mortgage Loans in Loan Group 1 and Loan Group 2, respectively, by aggregate
principal balance, are secured by Mortgaged Properties located in one United
States postal zip code.
(19) The Combined Loan-to-Value Ratio for each Mortgage Loan was not
in excess of 100.00%.
(30) The weighted average remaining term to maturity of the Mortgage
Loans on a contractual basis as of the Cut-off Date is approximately [297] and
[298] months with respect to the Mortgage Loans in Loan Group 1 and Loan Group
2, respectively. The Loan Rate Caps for the Mortgage Loans range between
[6.000] % and [21.000] % and [11.949] % and [21.000] % with respect to the
Mortgage Loans in Loan Group 1 and Loan Group 2, respectively, and the
weighted average Loan Rate Cap is approximately [17.837] % and [17.837] %,
with respect to the Mortgage Loans in Loan Group 1 and Loan Group 2,
respectively. The Gross Margins for the Mortgage Loans range between [-1.125]
% and [18.000] % and [-0.999] % and [8.000] % with respect to the Mortgage
Loans in Loan Group 1 and Loan Group 2, respectively, and the weighted average
Gross Margin is approximately [2.374] % and [2.065] % as of the Cut-off Date
for the Mortgage Loans in Loan Group 1 and Loan Group 2, respectively. The
Loan Rates on the Mortgage Loans range between [2.990] % and [14.875] % and
[2.990] % and [13.875] % with respect to the Mortgage Loans in Loan Group 1
and Loan Group 2, respectively, and the weighted average Loan Rate on the
Mortgage Loans is approximately [8.023] % and [8.013] % with respect to the
Mortgage Loans in Loan Group 1 and Loan Group 2, respectively. As of the
Cut-off Date, 100.00% and [5.01] % of the Mortgage Loans in Loan Group 1 and
Loan Group 2, respectively, by aggregate principal balance, have original
principal balances (by credit limit) that conform to Xxxxxx Xxx or Xxxxxxx Mac
guidelines.
(32) No more than [34.81] % and [36.64] % (by Cut-off Date Loan
Balance) of the Mortgage Loans in Loan Group 1 and Loan Group 2, respectively,
are secured by real property improved by individual condominium units, units
in planned unit developments, townhouses, or
Xxx-1-1
two-to-four family residences erected on them, and at least [65.19] % and
[63.36] % (by Cut-off Date Loan Balance) of the Mortgage Loans in Loan Group 1
and Loan Group 2, respectively, are secured by real property with a detached
one-family residence erected on them.
(33) The Credit Limits on the Mortgage Loans range between
approximately $[7,500] and $[250,000] and $[7,500] and $[2,000,000] with an
average of approximately $[40,053] and $[113,531] with respect to the Mortgage
Loans in Loan Group 1 and Loan Group 2, respectively. As of the Cut-off Date,
no Mortgage Loan had a principal balance in excess of approximately $[247,926]
and $[1,999,950] and the average principal balance of the Mortgage Loans is
equal to approximately $[34,962] and $[96,760] with respect to the Mortgage
Loans in Loan Group 1 and Loan Group 2, respectively.
(34) Approximately [0] % and [100] % of the Mortgage Loans of each
Loan Group, by aggregate principal balance as of the Cut-off Date for the
Mortgage Loans, are secured by first and second liens, respectively.
(35) As of the Closing Date, no more than [29.66] % and [11.93] % of
the Mortgage Loans in Loan Group 1 and Loan Group 2, respectively, by
aggregate principal balance, were appraised electronically.
(40) As of the Cut-off Date (based on the drawn balances), the
Mortgage Loans had a weighted average Combined Loan-to-Value Ratio of [88.35]
% and [87.71] %; a range of Combined Loan-to-Value Ratios between [8.13] % and
100.00% and [9.00] % and 100.00%; a percentage of primary residences of
[91.11] % and [90.98] %; a weighted average FICO score of [703] and [709]; a
range of FICO scores between [470] and [869] and [505] and [826]; a Weighted
Average Net Loan Rate of [7.523] % and [7.513] %; a range of net Loan Rates
between [2.490] % and [14.375] % and [2.490] % and [13.375] %; a weighted
average original stated term to maturity of [301] and [300] months; a range of
original term to maturity between [120] and [360] months and [120] and [360]
months; a range of remaining term to maturity between [73] and [360] months
and [97] and [360] months; an average drawn balance of [$[34,962] and
$[96,760]; an average] utilization ratio of [89.24] % and [89.09] %; and
[45.25] % and [76.10] % of the Mortgage Loans have their respective Mortgaged
Properties located in the top five states, measured by aggregate drawn
balances, all with respect to the Mortgage Loans in Loan Group 1 and Loan
Group 2, respectively.
Xxx-1-2
