GOLDMAN SACHS MORTGAGE COMPANY Purchaser and WELLS FARGO BANK, N.A. Company
Execution
Copy
[Conventional/FHA/VA/RHS]
XXXXXXX
XXXXX MORTGAGE COMPANY
Purchaser
and
XXXXX
FARGO BANK, N.A.
Company
AMENDED
AND RESTATED
MASTER
SELLER’S WARRANTIES AND SERVICING AGREEMENT
Dated
as
of March 1, 2006
TABLE
OF CONTENTS
ARTICLE
I
DEFINITIONS
ARTICLE
II
CONVEYANCE
OF MORTGAGE LOANS; POSSESSION OF MORTGAGE
FILES;
BOOKS AND RECORDS; DELIVERY OF DOCUMENTS
|
Section
2.01
|
Conveyance
of Mortgage Loans; Possession of Mortgage Files; Maintenance of
Servicing
Files.
|
18
|
|
Section
2.02
|
Books
and Records; Transfers of Mortgage Loans.
|
19
|
|
Section
2.03
|
Delivery
of Documents.
|
20
|
|
Section
2.04
|
Mortgage
Schedule.
|
22
|
|
Section
2.05
|
Examination
of Mortgage Files.
|
22
|
|
Section
2.06
|
Representations,
Warranties and Agreements of the Company.
|
23
|
|
Section
2.07
|
Representation,
Warranties and Agreement of Purchaser.
|
23
|
|
Section
2.08
|
Closing.
|
24
|
|
Section
2.09
|
Closing
Documents.
|
24
|
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES REMEDIES AND BREACH
|
Section
3.01
|
Company
Representations and Warranties.
|
25
|
|
Section
3.02
|
Representations
and Warranties Regarding Individual Mortgage Loans.
|
28
|
|
Section
3.03
|
Repurchase.
|
45
|
ARTICLE
IV
ADMINISTRATION
AND SERVICING OF MORTGAGE LOANS
|
Section
4.01
|
Company
to Act as Servicer.
|
47
|
|
Section
4.02
|
Liquidation
of Mortgage Loans.
|
48
|
|
Section
4.03
|
Collection
of Mortgage Loan Payments.
|
49
|
|
Section
4.04
|
Establishment
of and Deposits to Custodial Account.
|
50
|
|
Section
4.05
|
Permitted
Withdrawals From Custodial Account.
|
51
|
|
Section
4.06
|
Establishment
of and Deposits to Escrow Account.
|
53
|
|
Section
4.07
|
Permitted
Withdrawals From Escrow Account.
|
54
|
|
Section
4.08
|
Payment
of Taxes, Insurance and Other Charges.
|
55
|
|
Section
4.09
|
Protection
of Accounts.
|
55
|
|
Section
4.10
|
Maintenance
of Hazard Insurance.
|
55
|
|
Section
4.11
|
Maintenance
of Mortgage Impairment Insurance.
|
57
|
|
Section
4.12
|
Maintenance
of Fidelity Bond and Errors and Omissions Insurance.
|
57
|
|
Section
4.13
|
Inspections.
|
58
|
|
Section
4.14
|
Restoration
of Mortgaged Property.
|
58
|
|
Section
4.15
|
Claims.
|
59
|
|
Section
4.16
|
Title,
Management and Disposition of REO Property.
|
59
|
|
Section
4.17
|
Real
Estate Owned Reports.
|
60
|
|
Section
4.18
|
Liquidation
Reports.
|
60
|
|
Section
4.19
|
Reports
of Foreclosures and Abandonments of Mortgaged Property.
|
61
|
|
Section
4.20
|
Fair
Credit Reporting Act.
|
61
|
|
Section
4.21
|
Maintenance
of Primary Mortgage Insurance Policy; Claims.
|
61
|
ARTICLE
V
PAYMENTS
TO PURCHASER
|
Section
5.01
|
Remittances.
|
67
|
|
Section
5.02
|
Statements
to Purchaser.
|
68
|
|
Section
5.03
|
Monthly
Advances by Company.
|
68
|
ARTICLE
VI
GENERAL
SERVICING PROCEDURES
|
Section
6.01
|
Transfers
of Mortgaged Property.
|
69
|
|
Section
6.02
|
Satisfaction
of Mortgages and Release of Mortgage Files.
|
70
|
|
Section
6.03
|
Servicing
Compensation.
|
70
|
|
Section
6.04
|
Annual
Statement as to Compliance.
|
70
|
|
Section
6.05
|
Annual
Independent Public Accountants’ Servicing Report.
|
71
|
|
Section
6.06
|
Right
to Examine Company Records.
|
71
|
|
Section
6.07
|
Compliance
with REMIC Provisions.
|
74
|
|
Section
6.08
|
Compliance
with Xxxxx-Xxxxx-Xxxxxx Act of 1999.
|
74
|
ARTICLE
VII
COMPANY
TO COOPERATE
|
Section
7.01
|
Provision
of Information.
|
74
|
|
Section
7.02
|
Financial
Statements; Servicing Facility.
|
74
|
ARTICLE
VIII
THE
COMPANY
|
Section
8.01
|
Indemnification;
Third Party Claims.
|
75
|
|
Section
8.02
|
Merger
or Consolidation of the Company.
|
75
|
-ii-
|
Section
8.03
|
Limitation
on Liability of Company and Others.
|
76
|
|
Section
8.04
|
Limitation
on Resignation and Assignment by Company.
|
76
|
ARTICLE
IX
SECURITIZATION
TRANSACTION
|
Section
9.01
|
Removal
of Mortgage Loans from Inclusion Under this Agreement Upon a
Securitization Transaction.
|
77
|
ARTICLE
X
DEFAULT
|
Section
10.01
|
Events
of Default.
|
89
|
|
Section
10.02
|
Waiver
of Defaults.
|
91
|
ARTICLE
XI
TERMINATION
|
Section
11.01
|
Termination.
|
91
|
|
Section
11.02
|
Termination
Without Cause.
|
91
|
|
Section
11.03
|
Termination
With Cause.
|
92
|
ARTICLE
XII
MISCELLANEOUS
PROVISIONS
|
Section
12.01
|
Successor
to Company.
|
92
|
|
Section
12.02
|
Amendment.
|
93
|
|
Section
12.03
|
Governing
Law.
|
93
|
|
Section
12.04
|
Duration
of Agreement.
|
93
|
|
Section
12.05
|
Notices.
|
93
|
|
Section
12.06
|
Severability
of Provisions.
|
94
|
|
Section
12.07
|
Relationship
of Parties.
|
95
|
|
Section
12.08
|
Execution;
Successors and Assigns.
|
95
|
|
Section
12.09
|
Recordation
of Assignments of Mortgage.
|
95
|
|
Section
12.10
|
Assignment
by Purchaser.
|
95
|
|
Section
12.11
|
Solicitation
of Mortgagor.
|
96
|
|
Section
12.12
|
General
Interpretive Principles.
|
96
|
-iii-
EXHIBITS
|
Exhibit
A
|
Mortgage
Loan Schedule
|
|
Exhibit
B
|
Contents
of Each Mortgage File
|
|
Exhibit
C
|
Form
of Custodial Agreement
|
|
Exhibit
D
|
Form
of Opinion of Counsel
|
|
Exhibit
E
|
Items
to Be Included in Monthly Remittance Advice
|
|
Exhibit
F
|
Forms
of Assignment, Assumption and Recognition Agreement
|
|
Exhibit
G
|
Form
of Seller’s Officer’s Certificate
|
|
Exhibit
H
|
Process
Guidelines
|
|
Exhibit
I
|
Form
of Xxxxxxx Mac Amendment
|
|
Exhibit
J
|
Form
of Xxxxxx Xxx Assignment, Assumption and Recognition
Agreement
|
|
Exhibit
K
|
Form
of Assignment and Conveyance Agreement
|
|
Exhibit
L
|
Form
of Indemnification Agreement
|
|
Exhibit
M
|
Servicing
Criteria to be addressed in Assessment of Compliance
|
|
Exhibit
N
|
Sarbanes
Certificate
|
-iv-
This
is
an Amended and Restated Master Seller’s Warranties and Servicing Agreement for
various residential first and second lien mortgage loans, dated and effective
as
of March 1, 2006 and is executed between Xxxxxxx Sachs Mortgage Company,
as
purchaser (the “Purchaser”), and Xxxxx Fargo Bank, N.A., as seller and servicer
(the “Company”).
WITNESSETH:
WHEREAS,
the Purchaser and the Company are parties to that certain Master Seller’s
Warranties and Servicing Agreement, dated October 1, 2004 (the “Master
Agreement”), between the Purchaser and the Company;
WHEREAS,
the Company and the Purchaser wish to amend certain provisions of the Master
Agreement as set forth in this Amended and Restated Master Seller’s Warranties
and Servicing Agreement;
WHEREAS,
the Purchaser has agreed to purchase from the Company and the Company has
agreed
to sell to the Purchaser from time to time certain one- to four-family, first
and second lien, fixed-rate and adjustable-rate residential mortgage loans
which
have an aggregate outstanding principal balance as indicated on the related
Mortgage Loan Schedule (as defined below) which is attached as Exhibit A
to the
related Assignment and Conveyance Agreement (as defined below) and as set
forth
in the related Commitment Letter (as defined below);
WHEREAS,
each of the Mortgage Loans (as defined below) is secured by a mortgage, deed
of
trust or other security instrument creating a first lien on a one- to
four-family residential dwelling located in the jurisdiction indicated on
the
related Mortgage Loan Schedule; and
WHEREAS,
the Purchaser and the Company wish to prescribe the manner of purchase of
the
Mortgage Loans and the conveyance, servicing and control of the Mortgage
Loans,
including the servicing and control of the Mortgage Loans previously purchased
from the Company by the Purchaser pursuant to the Master Agreement;
NOW,
THEREFORE, in consideration of the mutual agreements hereinafter set forth,
and
for other good and valuable consideration, the receipt and adequacy of which
is
hereby acknowledged, the Purchaser and the Company agree as
follows:
-1-
ARTICLE
I
DEFINITIONS
Whenever
used herein, the following words and phrases, unless the content otherwise
requires, shall have the following meanings:
Accepted
Servicing Practices:
With
respect to any Mortgage Loan, those customary mortgage servicing practices
of
prudent mortgage lending institutions which service mortgage loans of the
same
type as such Mortgage Loan in the jurisdiction where the related Mortgaged
Property is located.
Adjustable
Rate Mortgage Loan:
An
adjustable rate Mortgage Loan purchased pursuant to this Agreement.
Agency:
Xxxxxx
Mae, Xxxxxxx Mac, GNMA or any of them as applicable.
Agency
Transfer:
Any
sale or transfer of some or all of the Mortgage Loans by the Purchaser to
an
Agency which sale or transfer is not a Securitization Transaction or Whole
Loan
Transfer.
Agreement:
This
Amended and Restated Master Seller’s Warranties and Servicing Agreement and all
exhibits hereto, amendments hereof and supplements hereto.
ALTA:
The
American Land Title Association or any successor thereto.
Applicable
Law:
All
provisions of statutes, rules and regulations, interpretations and orders
of
governmental bodies or regulatory agencies applicable to a Person, and all
orders and decrees of all courts and arbitrators in proceedings or actions
in
which the Person in question is a party.
Appraised
Value:
With
respect to any Mortgage Loan, the lesser of (i) the value set forth on the
appraisal made in connection with the origination of the related Mortgage
Loan
as the value of the related Mortgage Property, or (ii) the purchase price
paid for the Mortgage Property; provided,
however,
in the
case of a refinanced Mortgage Loan, such value shall be based solely on the
appraisal made in connection with the refinance of such Mortgage
Loan.
Assignment
and Conveyance Agreement:
An
assignment and conveyance agreement with respect to the Mortgage Loans purchased
on a Closing Date in the form annexed hereto as Exhibit K.
Assignment
of Mortgage or Assignment:
An
assignment of the Mortgage, notice of transfer or equivalent instrument in
recordable form, sufficient under the laws of the jurisdiction wherein the
related Mortgaged Property is located to reflect the sale of the Mortgage
to the
Purchaser or its designated assignee, or if the related Mortgage has been
recorded in the name of MERS or its designee, such actions as are necessary
to
cause the Purchaser to be shown as the owner of the related Mortgage on the
records of MERS for purposes of the system of recording transfers of beneficial
ownership of mortgages maintained by MERS..
-2-
Assignment
of Mortgage Note and Pledge Agreement:
With
respect to a Cooperative Loan, an assignment of the Mortgage Note and Pledge
Agreement.
Assignment
of Proprietary Lease:
With
respect to a Cooperative Loan, an assignment of the Proprietary Lease sufficient
under the laws of the jurisdiction wherein the related Cooperative Apartment
is
located to effect the assignment of such Proprietary Lease.
Business
Day:
Any day
other than (i) a Saturday or Sunday, or (ii) a day on which banking
and savings and loan institutions in the states where the parties hereto
are
located are authorized or obligated by law or executive order to be
closed.
Buydown
Account:
An
account maintained by the Company specifically to hold all Buydown Funds
to be
applied to individual Buydown Loans.
Buydown
Agreement:
An
agreement between the Company and a Mortgagor, or an agreement among the
Company, a Mortgagor and a seller of a Mortgaged Property or a third party
with
respect to a Mortgage Loan which provides for the application of Buydown
Funds.
Buydown
Funds:
In
respect of any Buydown Mortgage Loan, any amount contributed by the seller
of a
Mortgaged Property subject to a Buydown Mortgage Loan, the buyer of such
property, the Company or any other source, plus interest earned thereon,
in
order to enable the Mortgagor to reduce the payments required to be made
from
the mortgagor’s funds in the early years of a Mortgage Loan.
Buydown
Mortgage Loan:
Any
Mortgage Loan in respect of which, pursuant to a Buydown Agreement, (i) the
Mortgagor pays less than the full monthly payments specified in the Mortgage
Note for a specified period, and (ii) the difference between the payments
required under such Buydown Agreement and the Mortgage Note is provided from
Buydown Funds.
Buydown
Period:
The
period of time when a Buydown Agreement is in effect with respect to a related
Buydown Mortgage Loan.
Closing
Date:
Each
date that the Purchaser purchases Mortgage Loans (including without limitation,
all rights, titles, interests, obligations and benefits associated therewith)
from the Company hereunder.
Code:
The
Internal Revenue Code of 1986, as it may be amended from time to time or
any
successor statute thereto, and applicable U.S. Department of the Treasury
regulations issued pursuant thereto.
Combined
Loan-to-Value Ratio or CLTV:
As to
any Second Lien Mortgage Loan at any date of determination, the ratio on
such
date of the principal balance of such Mortgage Loan plus the principal balance
of any Superior Lien, to the Appraised Value of the related Mortgaged
Property.
-3-
Commission:
The United States Securities and Exchange Commission.
Commitment
Letter:
With
respect to any pool of Mortgage Loans purchased and sold on any Closing Date,
the letter agreement between the Purchaser and the Company (including any
exhibits, schedules and attachments thereto), setting forth the terms and
conditions of such transaction and describing the Mortgage Loans to be purchased
by the Purchaser on such Closing Date. A Commitment Letter may relate to
more
than one pool of Mortgage Loans to be purchased on a specified Closing
Date.
Company:
Xxxxx
Fargo Bank, N.A., or its successor in interest or assigns, or any successor
to
the Company under this Agreement appointed as herein provided.
Company
Certification:
The
certification delivered by the Company in a form substantially similar to
Exhibit N of this Agreement.
Company
Employees:
The
meaning assigned to such term in Section 4.12.
Company
Information:
As
defined in Section 9.01(g)(i)(A).
Condemnation
Proceeds:
All
awards or settlements in respect of a Mortgaged Property, whether permanent
or
temporary, partial or entire, by exercise of the power of eminent domain
or
condemnation, to the extent not required to be released to a Mortgagor in
accordance with the terms of the related Mortgage Loan Documents.
Conventional
Mortgage Loan:
Any
Mortgage Loan that is not a FHA Mortgage Loan, RHS Mortgage Loan and VA Mortgage
Loan.
Cooperative:
The
entity that holds title (fee or an acceptable leasehold estate) to all of
the
real property that the related Project comprises, including the land, separate
dwelling units and all common areas.
Cooperative
Apartment:
The
specific dwelling unit relating to a Cooperative Loan.
Cooperative
Lien Search:
A
search for (a) federal tax liens, mechanics’ liens, lis pendens, judgments of
record or otherwise against (i) the Cooperative, (ii) the seller of the
Cooperative Apartment and (iii) the Company, if the Cooperative Loan is a
refinanced Mortgage Loan, (b) filings of financing statements and (c) the
deed
of the Project into the Cooperative.
Cooperative
Loan:
A
Mortgage Loan that is secured by Cooperative Shares and a Proprietary Lease
granting exclusive rights to occupy the related Cooperative
Apartment.
Cooperative
Shares:
The
shares of stock issued by a Cooperative, owned by the Mortgagor, and allocated
to a Cooperative Apartment.
-4-
Covered
Loan:
A
Mortgage Loan categorized as “Covered” pursuant to the Standard & Poor’s
Glossary for File Format for LEVELS® Version 5.6, Appendix E, as revised from
time to time and in effect on each related Closing Date (excluding New Jersey
“Covered Home Loans” as that term is defined in clause (1) of the definition of
that term in the New Jersey Home Ownership Security Act of 2002).
Custodial
Account:
The
separate account or accounts created and maintained pursuant to Section
4.04.
Custodial
Agreement:
The
agreement governing the retention of the originals of each Mortgage Note,
Mortgage, Assignment of Mortgage and other Mortgage Loan Documents, a form
of
which is annexed hereto as Exhibit C.
Custodian:
The
custodian under the Custodial Agreement, or its successor in interest or
assigns, or any successor to the Custodian under the Custodial Agreement
as
provided therein.
Cut-off
Date:
The
first day of the month in which the respective Closing Date occurs.
Depositor:
The
depositor, as such term is defined in Regulation AB, with respect to any
Securitization Transaction.
Determination
Date:
The
Business Day preceding the Remittance Date.
Due
Date:
The day
of the month on which the Monthly Payment is due on a Mortgage Loan, exclusive
of any grace period.
Due
Period:
With
respect to each Remittance Date, the period commencing on the second day
of the
month preceding the month in which such Remittance Date occurs and ending
on
(and including) the first day of the month in which such Remittance Date
occurs.
Errors
and Omissions Insurance Policy:
An
errors and omissions insurance policy to be maintained by the Company pursuant
to Section 4.12.
Escrow
Account:
The
separate account or accounts created and maintained pursuant to Section
4.06.
Escrow
Payments:
With
respect to any Mortgage Loan, the amounts constituting ground rents, taxes,
assessments, water rates, sewer rents, municipal charges, mortgage insurance
premiums, fire and hazard insurance premiums, condominium charges, and any
other
payments required to be escrowed by the Mortgagor with the mortgagee pursuant
to
the Mortgage or any other related document.
Event
of Default:
Any one
of the conditions or circumstances enumerated in Section 10.01.
-5-
Exchange
Act:
The
Securities Exchange Act of 1934, as amended.
Fair
Credit Reporting Act:
The
Fair Credit Reporting Act of 1970, as amended.
Xxxxxx
Xxx:
The
Federal
National Mortgage Association, and its successors.
FDIC:
The
Federal Deposit Insurance Corporation, and its successors.
FHA:
Federal
Housing Administration, and its successors.
FHA
Mortgage Loan:
A
Mortgage Loan that has a MIC issued by HUD/FHA.
Fidelity
Bond:
A
fidelity bond to be maintained by the Company pursuant to Section
4.12.
First
Remittance Date:
With
respect to each Closing Date, the Remittance Date occurring in the calendar
month immediately following the month in which such Closing Date
occurs.
Fixed
Rate Mortgage Loan:
A fixed
rate mortgage loan purchased pursuant to this Agreement.
Xxxxxxx
Mac:
The
Federal Home Loan Mortgage Corporation, and its successors.
GNMA:
The
Government National Mortgage Association, and its successors.
Gross
Margin:
With
respect to each Adjustable Rate Mortgage Loan, the fixed percentage amount
set
forth in the related Mortgage Note which amount is added to the Index in
accordance with the terms of the related Mortgage Note to determine on each
Interest Rate Adjustment Date the Mortgage Interest Rate for such Mortgage
Loan.
High
Cost Loan:
A
Mortgage Loan classified as (a) a “high cost” loan under the Home Ownership and
Equity Protection Act of 1994, (b) a “high cost home,” “threshold,” “covered,”
(excluding New Jersey “Covered Home Loans” as that term is defined in clause (1)
of the definition of that term in the New Jersey Home Ownership Security
Act of
2002), “high risk home,” “predatory” or similar loan under any other applicable
state, federal or local law or (c) a Mortgage Loan categorized as “High Cost”
pursuant to the Standard & Poor’s Glossary for File Format for LEVELS®
Version 5.6, Appendix E, as revised from time to time and in effect on each
related Closing Date.
Home
Loan:
A
Mortgage Loan categorized as “Home Loan” pursuant to the Standard & Poor’s
Glossary for File Format for LEVELS® Version 5.6, Appendix E, as revised from
time to time and in effect on each related Closing Date.
HUD:
The
United States Department of Housing and Urban Development, and its
successors.
-6-
Index:
With
respect to each Adjustable Rate Mortgage Loan, the index identified on the
Mortgage Loan Schedule and set forth in the related Mortgage Note for the
purpose of calculating the interest thereon.
Interim
Funder:
With
respect to each MERS Designated Mortgage Loan, the Person named on the MERS®
System as the interim funder pursuant to the MERS Procedures
Manual.
Insurance
Proceeds:
Proceeds of any FHA, VA or RHS mortgage insurance or guarantee, title policy,
hazard policy or other insurance policy covering a Mortgage Loan, if any,
to the
extent such proceeds are not to be applied to the restoration of the related
Mortgaged Property or released to the Mortgagor in accordance with the
procedures that the Company would follow in servicing mortgage loans held
for
its own account.
Interest
Only Mortgage Loan:
A
Mortgage Loan for which an interest-only payment feature is allowed during
the
interest-only period set forth in the related Mortgage Note.
Interest
Rate Adjustment Date:
With
respect to each Adjustable Rate Mortgage Loan, the date specified in the
related
Mortgage Note, on which the Mortgage Interest Rate is adjusted.
Investor:
With
respect to each MERS Mortgage Loan, the Person named on the MERS System as
the
investor pursuant to the MERS Procedures Manual.
Lender
Paid Mortgage Insurance Policy or LPMI Policy:
A PMI
Policy for which the Company pays all premiums from its own funds, without
reimbursement therefor.
Letter
of Credit:
With
respect to a Pledged Asset Mortgage Loan, a letter of credit issued by the
Pledge Holder which may be drawn on by the Company in the event that the
related
Pledged Asset Mortgage Loan continues in default for ninety
(90) days.
LGC:
Loan
Guaranty Certificate issued by the VA as a guarantee that the federal government
will repay to the lender a specified percentage of the loan balance in the
event
of the borrower’s default.
Lifetime
Rate Cap:
The
provision of each Mortgage Note related to an Adjustable Rate Mortgage Loan
which provides for an absolute maximum Mortgage Interest Rate thereunder.
The
Mortgage Interest Rate during the terms of each Adjustable Rate Mortgage
Loan
shall not at any time exceed the Mortgage Interest Rate at the time of
origination of such Adjustable Rate Mortgage Loan by more than the amount
per
annum set forth on the Mortgage Loan Schedule.
Liquidation
Proceeds:
Cash
(other than Insurance Proceeds or Condemnation Proceeds) received in connection
with the liquidation of a defaulted Mortgage Loan, whether through the sale
or
assignment of such Mortgage Loan, trustee’s sale, foreclosure sale, sale of REO
Property, or otherwise, or the sale of the related Mortgaged Property if
the
Mortgaged Property is acquired in satisfaction of the Mortgage
Loan.
-7-
Loan
Note Guarantee:
The
document issued by RHS as a guarantee that the federal government will repay
to
the lender the specified percentage of the loan balance in the event of the
borrower’s default.
Loan-to-Value
Ratio:
With
respect to any Mortgage Loan, the ratio of the original loan amount of the
Mortgage Loan at its origination or refinancing, as applicable, to the Appraised
Value of the Mortgaged Property.
LPMI
Proceeds:
Proceeds of any Lender Paid Mortgage Insurance Policy.
MERS:
Mortgage Electronic Registration Systems, Inc., a corporation organized and
existing under the laws of the State of Delaware, or any successor
thereto.
MERS
Mortgage Loan:
Any
Mortgage Loan registered with MERS on the MERS System.
MERS
Procedure Manual:
The
MERS Procedure Manual, as it may be amended, supplemented or otherwise modified
from time to time.
MERS
System:
The
system of recording transfers of mortgages electronically maintained by
MERS.
MERS
Report:
The
report from the MERS System listing MERS Designated Mortgage Loans and other
information.
MIC:
Mortgage Insurance Certificate issued by HUD/FHA as evidence that a mortgage
has
been insured and that a contract of mortgage insurance exists between HUD/FHA
and the lender.
MIN:
The
Mortgage Identification Number used to identify mortgage loans registered
under
MERS.
MOM
Loan:
Any
Mortgage Loan as to which MERS is acting as mortgagee, solely as nominee
for the
originator of such Mortgage Loan and its successors and assigns.
Monthly
Advance:
The
portion of each Monthly Payment that is delinquent with respect to each Mortgage
Loan at the close of business on the Determination Date required to be advanced
by the Company pursuant to Section 5.03 on the Business Day immediately
preceding the Remittance Date of the related month.
Monthly
Payment:
The
scheduled monthly payment of principal and interest on a Mortgage Loan or
in the
case of an Interest Only Mortgage Loan, payments of (i) interest, or (ii)
principal and interest, as applicable, on a Mortgage Loan.
Monthly
Remittance Advice:
The
meaning assigned to such term in Section 5.02.
-8-
Mortgage:
The
mortgage, deed of trust or other instrument and riders thereto securing a
Mortgage Note, which creates a first or second lien on an unsubordinated
estate
in fee simple in real property securing the Mortgage Note, or the Pledge
Agreement securing the Mortgage Note for a Cooperative Loan.
Mortgage
File:
The
items pertaining to a particular Mortgage Loan referred to in Exhibit B annexed
hereto, and any additional documents required to be added to the Mortgage
File
pursuant to this Agreement.
Mortgage
Interest Rate:
The
annual rate of interest borne on a Mortgage Note in accordance with the
provisions of the Mortgage Note.
Mortgage
Interest Rate Cap:
With
respect to an Adjustable Rate Mortgage Loan, the limit on each Mortgage Interest
Rate adjustment as set forth in the related Mortgage Note.
Mortgage
Loan:
An
individual Mortgage Loan which is the subject of this Agreement, each Mortgage
Loan originally sold and subject to this Agreement being identified on the
Mortgage Loan Schedule, which Mortgage Loan includes without limitation the
Mortgage File, the Monthly Payments, Principal Prepayments, Liquidation
Proceeds, Condemnation Proceeds, Insurance Proceeds, REO Disposition Proceeds
and all other rights, benefits, proceeds and obligations arising from or
in
connection with such Mortgage Loan.
Mortgage
Loan Documents:
With
respect to a Mortgage Loan, the original related Mortgage Note with applicable
addenda and riders, the original related security instrument and the originals
of any required addenda and riders, the original related Assignment and any
original intervening related Assignments, the original related title insurance
policy, and with respect to the Non-Conventional Mortgage Loans, the related
MIC
or LGC or Loan Note Guarantee, as applicable, and for each Pledged Asset
Mortgage Loan, the original advice of such Letter of Credit executed by the
Pledge Holder and the Company’s executed notice of transfer (Exhibit A to the
Letter of Credit) of beneficiary of such Letter of Credit to the Purchaser
or
its designee.
Mortgage
Loan Remittance Rate:
With
respect to each Mortgage Loan, the annual rate of interest remitted to the
Purchaser, which shall be equal to the Mortgage Interest Rate minus the
Servicing Fee Rate.
Mortgage
Loan Schedule:
A
schedule of Mortgage Loans prepared and identified on each Closing Date and
attached as Schedule A to the Assignment and Conveyance Agreement, such schedule
setting forth the following information with respect to each Mortgage Loan:
(1) the Company’s Mortgage Loan number; (2) the address, city, state
and zip code of the Mortgaged Property; (3) a code indicating whether the
Mortgaged Property is a single family residence, two-family residence,
three-family residence, four-family residence or planned unit development;
(4) the purpose of the Mortgage Loan; (5) the current Mortgage
Interest Rate; (6) the Mortgage Loan Remittance Rate; (7) the
Servicing Fee Rate; (8) the current Monthly Payment; (9) the original
term to maturity; (10) the scheduled maturity date (and, if different, the
stated maturity date indicated on the Mortgage Note on its date of origination);
(11) the principal balance of the Mortgage Loan as of the Cut-off Date
after deduction of payments of principal due on or before the Cut-off Date
whether or not collected; (12) the Loan-to-Value Ratio; (13) the Due
Date of the Mortgage Loan; (14) a code indicating whether the Mortgage is
insured by FHA or guaranteed by VA; (15) a code indicating whether the
Mortgagor or the Mortgaged Property is the subject of a bankruptcy case;
(16) the amount of any delinquencies and the due date of any delinquent
payments; (17) the CPI twelve month pay string; (18) a code indicating
whether the Mortgage Loan is a MERS Mortgage Loan; (19) a code indicating
whether the Mortgage Loan has a Primary Mortgage Insurance Policy; and
(20) with respect to each Adjustable-Rate Mortgage Loan, (a) the first
Interest Rate Adjustment Date and the adjustment date frequency, (b) the
Gross Margin, (c) the maximum Mortgage Interest Rate under the terms of the
Mortgage Note, (d) the minimum Mortgage Interest Rate under the terms of
the Mortgage Note, (e) the periodic rate cap; (f) the first Interest
Rate Adjustment Date immediately following the Cut-off Date, and (g) the
index on which the Mortgage Interest Rate is based.
-9-
Mortgage
Note:
The
note or other evidence of the indebtedness of a Mortgagor secured by a Mortgage
and riders thereto.
Mortgaged
Property:
The
real property (or with respect to a Cooperative Loan, the related Cooperative
Apartment) securing repayment of the debt evidenced by a Mortgage
Note.
Mortgagor:
The
obligor on a Mortgage Note.
Non-Assigned
Letter of Credit:
A
Letter of Credit in which the named beneficiary is the Company.
Non-Conventional
Mortgage Loans:
The FHA
Mortgage Loans, RHS Mortgage Loans and VA Mortgage Loans.
Officer’s
Certificate:
A
certificate signed by the Chairman of the Board, the Vice Chairman of the
Board,
the President, a Vice President, an Assistant Vice President, the Treasurer,
the
Secretary or one of the Assistant Treasurers or Assistant Secretaries of
the
Company, and delivered to the Purchaser as required by this
Agreement.
Opinion
of Counsel:
A
written opinion of counsel, who may be an employee of the Company, reasonably
acceptable to the Purchaser.
Permitted
Investments:
Investments
that mature, unless payable on demand, not later than the Business Day preceding
the related Remittance Date; provided
that
such investments shall only consist of the following:
(i) direct
obligations of, or obligations fully guaranteed as to principal and interest
by,
the United States or any agency or instrumentality thereof, provided such
obligations are backed by the full faith and credit of the United
States;
-10-
(ii) repurchase
obligations (the collateral for which is held by a third party) with respect
to
any security described in clause (i) above, provided that the long-term
unsecured obligations of the party agreeing to repurchase such obligations
are
at the time rated by each Rating Agency in one of its two highest rating
categories;
(iii) certificates
of deposit, time deposits and bankers’ acceptances of any bank or trust company
incorporated under the laws of the United States or any state, provided that
the
long-term unsecured debt obligations of such bank or trust company (or, in
the
case of the principal depository institution of a depository institution
holding
company, the long-term unsecured debt obligations of the depository institution
holding company) at the date of acquisition thereof have been rated by each
Rating Agency in one of its two highest rating categories;
(iv) commercial
paper (having original maturities of not more than 365 days) of any corporation
incorporated under the laws of the United States or any state thereof which
on
the date of acquisition has been rated by each Rating Agency in its highest
rating category; and
(v) any
other
demand, money market or time deposit account or obligation, or interest-bearing
or other security or investment, acceptable to the Purchaser (such acceptance
evidenced in writing);
provided further
that
“Permitted Investments” shall not include any instrument described hereunder
which evidences either the right to receive (a) only interest with respect
to
the obligations underlying such instrument or (b) both principal and interest
payments derived from obligations underlying such instrument and the interest
and principal payments with respect to such instrument provide a yield to
maturity at par greater than 120% of the yield to maturity at par of the
underlying obligations.”
Periodic
Rate Cap:
The
provision of each Mortgage Note related to an Adjustable Rate Mortgage Loan
which provides for an absolute maximum amount by which the Mortgage Interest
Rate therein may increase or decrease on an Interest Rate Adjustment Date
above
or below the Mortgage Interest Rate previously in effect. The Periodic Rate
Cap
for each Adjustable Rate Mortgage Loan is the rate set forth on the Mortgage
Loan Schedule.
Periodic
Rate Floor:
With
respect to each Adjustable Rate Mortgage Loan, the provision of each Mortgage
Note which provides for an absolute maximum amount by which the Mortgage
Interest Rate therein may decrease on an Interest Rate Adjustment Date below
the
Mortgage Interest Rate previously in effect. The Periodic Rate Floor for
each
Adjustable Rate Mortgage Loan is the rate set forth on the Mortgage Loan
Schedule.
Person:
Any
individual, corporation, partnership, limited liability company, joint venture,
association, joint-stock company, trust, unincorporated organization, government
or any agency or political subdivision thereof.
-00-
Xxxxxx
Xxxxxxxxx:
With
respect to a Cooperative Loan, the specific agreement creating a first lien
on
and pledge of the Cooperative Shares and the appurtenant Proprietary
Lease.
Pledge
Holder:
The
entity which issued a Letter of Credit.
Pledge
Instruments:
With
respect to a Cooperative Loan, the Stock Power, the Assignment of the
Proprietary Lease and the Assignment of the Mortgage Note and Pledge
Agreement.
Pledged
Asset Mortgage Loan:
A
Mortgage Loan as to which, at the time of origination, a Letter of Credit
was
issued in favor of the initial holder of such Mortgage Loan.
Primary
Mortgage Insurance Policy or PMI Policy:
Each
policy of primary mortgage insurance represented to be in effect pursuant
to
Section 3.02(xxxiv), or any replacement policy therefor obtained by the Company
pursuant to Section 4.21.
Prime
Rate:
The
prime rate announced to be in effect from time to time, as published as the
average rate in The Wall Street Journal.
Principal
Balance:
As to
each Mortgage Loan, (i) the actual outstanding principal balance of the
Mortgage Loan at the Cut-off Date after giving effect to payments of principal
due on or before such date, minus (ii) all amounts attributable to
principal collected from or on behalf of the Mortgagor, including the principal
portion of Liquidation Proceeds, Condemnation Proceeds, and Insurance
Proceeds.
Principal
Prepayment:
Any
payment or other recovery of principal on a Mortgage Loan, including amounts
received in connection with repurchases of Mortgage Loans by the Company,
as
seller, in accordance with the terms of this Agreement, which is received
in
advance of its scheduled Due Date, including any prepayment penalty or premium
thereon and which is not accompanied by an amount of interest representing
scheduled interest due on any date or dates in any month or months subsequent
to
the month of prepayment.
Principal
Prepayment Period:
With
respect to each Remittance Date, the period commencing on the first day of
the
month preceding the month in which such Remittance Date occurs, and ending
on
the last day of such month.
Project:
With
respect to a Cooperative Loan, all real property owned by the related
Cooperative including the land, separate dwelling units and all common
areas.
Proprietary
Lease:
With
respect to a Cooperative Loan, a lease on a Cooperative Apartment evidencing
the
possessory interest of the Mortgagor in such Cooperative Apartment.
Purchase
Price:
The
purchase price specified in the Commitment Letter.
-12-
Purchaser:
Xxxxxxx
Xxxxx Mortgage Company, or its successor in interest or any successor to
the
Purchaser under this Agreement as herein provided.
Qualification
Defect:
With
respect to a Mortgage Loan, (a) a defective document in the Mortgage File,
(b) the absence of a document in the Mortgage File, or (c) the breach
of any representation, warranty or covenant with respect to the Mortgage
Loan
made by the Company, but, in each case, only if the affected Mortgage Loan
would
cease to qualify as a “qualified mortgage” for purposes of the REMIC
Provisions.
Qualified
Correspondent:
Any
Person from which the Company purchased Mortgage Loans, provided that the
following conditions are satisfied: (i) such Mortgage Loans were originated
pursuant to an agreement between the Company and such Person that contemplated
that such person would underwrite mortgage loans from time to time, for sale
to
the Company, in accordance with underwriting guidelines designated by the
Company (“Designated Guidelines”) or guidelines that do not vary materially from
such Designated Guidelines; (ii) such Mortgage Loans were in fact underwritten
as described in clause (i) above and were acquired by the Company within
180
days after origination; (iii) either (x) the Designated Guidelines were,
at the
time such Mortgage Loans were originated, used by the Company in origination
of
mortgage loans of the same type as the Mortgage Loans for the Company’s own
account or (y) the Designated Guidelines were, at the time such Mortgage
Loans
were underwritten, designated by the Company on a consistent basis for use
by
lenders in originating mortgage loans to be purchased by the Company; and
(iv)
the Company employed, at the time such Mortgage Loans were acquired by the
Company, pre-purchased or post-purchased quality assurance procedures (which
may
involve, among other things, review of a sample or mortgage loans purchased
during a particular time period or through particular channels) designed
to
ensure that Persons from which it purchased mortgage loans properly applied
the
underwriting criteria designated by the Company.
Qualified
Depository:
A
federal or state chartered depository institution, the deposits in which
are
insured by the FDIC to the applicable limits and the short-term unsecured
debt
obligations of which (or, in the case of a depository institution that is
a
subsidiary of a holding company, the short-term unsecured debt obligations
of
such holding company) are rated A-1 by Standard & Poor’s Ratings Services
and Prime-1 by Xxxxx’x Investors Service, Inc. (or a comparable rating if
another rating agency is specified by the Purchaser by written notice to
the
Company) at the time any deposits are held on deposit therein; provided,
however,
that in
the event any of the Mortgage Loans are subject to a Pass Through Transfer,
the
Company agrees that the holding company or other entity which maintains any
accounts subject to this definition, shall satisfy the rating requirements
established by any Rating Agency which rates securities issued as part of
the
Securitization Transaction.
Qualified
Insurer:
A
mortgage guaranty insurance company duly authorized and licensed where required
by law to transact mortgage guaranty insurance business and approved as an
insurer by Xxxxxx Xxx.
-13-
Rating
Agency:
Xxxxx’x
Investors Service, Inc., Standard & Poor’s Ratings Services, a division of
The XxXxxx-Xxxx Companies, Fitch, Inc. (doing business as Fitch Ratings),
or any
other nationally recognized statistical credit rating agency rating any security
issued in connection with any Securitization Transaction.
Recognition
Agreement:
An
agreement whereby a Cooperative and a lender with respect to a Cooperative
Loan
(i) acknowledge that such lender may make, or intends to make, such Cooperative
Loan, and (ii) make certain agreements with respect to such Cooperative
Loan.
Reconstitution:
Any
Securitization Transaction or Whole Loan Transfer.
Reconstitution
Agreement:
The
agreement or agreements entered into by the Company and the Purchaser and/or
certain third parties on the Reconstitution Date or Dates with respect to
any or
all of the Mortgage Loans serviced hereunder, in connection with a Whole
Loan
Transfer or Securitization Transaction.
Reconstitution
Date:
The
date on which any or all of the Mortgage Loans serviced under this Agreement
may
be removed from this Agreement and reconstituted as part of a Securitization
Transaction, Agency Sale or Whole Loan Transfer pursuant to Section 9.01
hereof.
The Reconstitution Date shall be such date which the Purchaser shall
designate.
Regulation
AB:
Subpart
229.1100 - Asset Backed Securities (Regulation AB), 17 C.F.R.
§§229.1100-229.1123, as such may be amended from time to time, and subject
to
such clarification and interpretation as have been provided by the Commission
in
the adopting release (Asset-Backed Securities, Securities Act Release No.
33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005) or by the staff of the
Commission, or as may be provided by the Commission or its staff from time
to
time.
REMIC:
A “real
estate mortgage investment conduit” within the meaning of Section 860D of the
Code.
REMIC
Provisions:
Provisions of the federal income tax law relating to a REMIC, which appear
at
Section 860A through 860G of Subchapter M of Chapter 1, Subtitle A of the
Code,
and related provisions, and regulations, rulings or pronouncements promulgated
thereunder, as the foregoing may be in effect from time to time.
Remittance
Advice Date:
The
12th calendar day of each month or, if such 12th day is not a Business Day,
the
first Business Day immediately following such date.
Remittance
Date:
The
18th day (or if such 18th day is not a Business Day, the first Business Day
immediately preceding such date) of any month, beginning with the First
Remittance Date.
REO
Disposition:
The
final sale by the Company of any REO Property.
-14-
REO
Disposition Proceeds:
All
amounts received with respect to an REO Disposition pursuant to Section
4.16.
REO
Property:
A
Mortgaged Property acquired by the Company on behalf of the Purchaser through
foreclosure or by deed in lieu of foreclosure, as described in Section
4.16.
Repurchase
Price:
Unless
agreed otherwise by the Purchaser and the Company (including without limitation
as set forth in the Commitment Letter), a price equal to (i) the Scheduled
Principal Balance of the Mortgage Loan plus
(ii) interest on such Scheduled Principal Balance at the Mortgage Loan
Remittance Rate from the date on which interest has last been paid and
distributed to the Purchaser to the last day of the month of repurchase,
less
amounts
received or advanced in respect of such repurchased Mortgage Loan which are
being held in the Custodial Account for distribution in the month of repurchase,
to the extent such amounts are actually paid to the Purchaser upon the
repurchase of the related Mortgage Loan.
RHS:
The
Rural Housing Service of the Rural Development mission area, a department
of the
United States Department of Agriculture.
RHS
Mortgage Loan:
A
Mortgage Loan that has a Loan Note Guarantee issued by RHS.
Scheduled
Principal Balance:
As to
each Mortgage Loan, (i) the principal balance of the Mortgage Loan at the
Cut-off Date after giving effect to payments of principal due on or before
such
date, whether or not received, minus (ii) all amounts previously
distributed to the Purchaser with respect to the related Mortgage Loan
representing payments or recoveries of principal or advances made in lieu
thereof.
Second
Lien:
With
respect to a Mortgaged Property, a lien of the mortgage, deed of trust or
other
instrument securing a mortgage note which creates a second lien on the Mortgaged
Property.
Second
Lien Mortgage Loan:
A
Mortgage Loan secured by the lien on the Mortgaged Property, subject to one
prior lien on such Mortgaged Property securing financing obtained by the
related
Mortgagor.
Securities
Act:
The
Securities Act of 1933, as amended.
Securitization
Transaction:
Any
transaction involving either (a) a sale or other transfer of some or all
of the
Mortgage Loans directly or indirectly to an issuing entity in connection
with an
issuance of publicly offered or privately placed, rated or unrated
mortgage-backed securities or (b) an issuance of publicly offered or privately
placed, rated or unrated securities, the payments on which are determined
primarily by reference to one or more portfolios of residential mortgage
loans
consisting, in whole or in part, of some or all of the Mortgage
Loans.
-15-
Servicer:
As
defined in Section 9.01(f)(iii).
Servicing
Advances:
All
customary, reasonable and necessary “out of pocket” costs and expenses other
than Monthly Advances (including reasonable attorney’s fees and disbursements)
incurred in the performance by the Company of its servicing obligations,
including, but not limited to, the cost of (a) the preservation,
restoration and protection of the Mortgaged Property, (b) any enforcement
or judicial proceedings, including foreclosures, (c) the management and
liquidation of any REO Property and (d) compliance with the obligations
under Section 4.08 and 4.10.
Servicing
Criteria:
The
“servicing criteria” set forth in Item 1122(d) of Regulation AB, as such may be
amended from time to time.
Servicing
Fee:
With
respect to each Mortgage Loan, the amount of the per annum fee the Purchaser
shall pay to the Company, which shall, for a period of one full month, be
equal
to one-twelfth of the product of (a) the Servicing Fee Rate and
(b) the unpaid Principal Balance of such Mortgage Loan. Such fee shall be
payable monthly, computed on the basis of the same principal amount and same
period for which any related interest payment on a Mortgage Loan is received.
The obligation of the Purchaser to pay the Servicing Fee is limited to, and
the
Servicing Fee is payable solely from, the interest portion (including recoveries
with respect to interest from Liquidation Proceeds, to the extent permitted
by
Section 4.05) of such Monthly Payment collected by the Company, or as otherwise
provided under Section 4.05.
Servicing
Fee Rate:
With
respect to any Mortgage Loan, the rate per annum set forth in the related
Commitment Letter.
Servicing
File:
With
respect to each Mortgage Loan, the file retained by the Company consisting
of
originals of all documents in the Mortgage File which are not delivered to
the
Custodian and copies of the Mortgage Loan Documents listed in the Custodial
Agreement the originals of which are delivered to the Custodian pursuant
to
Section 2.03.
Servicing
Guide:
The
Xxxxxx Xxx Servicing Guide or the Xxxxxxx Mac Servicing Guide, as in existence
on the date of the related sale or transfer of Mortgage Loans to Xxxxxx Xxx
or
Xxxxxxx Mac, as applicable, as each may be amended or supplemented in writing
from time to time.
Servicing
Officer:
Any
officer of the Company involved in or responsible for the administration
and
servicing of the Mortgage Loans whose name appears on a list of servicing
officers furnished by the Company to the Purchaser upon request, as such
list
may from time to time be amended.
Static
Pool Information:
Static
pool information as described in Item 1105(a)(1) (3) and 1105(c) of Regulation
AB.
-16-
Stock
Certificate:
With
respect to a Cooperative Loan, a certificate evidencing ownership of the
Cooperative Shares issued by the Cooperative.
Stock
Power:
With
respect to a Cooperative Loan, an assignment of the Stock Certificate or
an
assignment of the Cooperative Shares issued by the Cooperative.
Subcontractor:
Any
vendor, subcontractor or other Person that is not responsible for the overall
servicing (as “servicing” is commonly understood by participants in the
mortgage-backed securities market) of Mortgage Loans but performs one or
more
discrete functions identified in Item 1122(d) of Regulation AB with respect
to
Mortgage Loans under the direction or authority of the Company or a
Subservicer.
Subservicer:
Any
Person that services Mortgage Loans on behalf of the Company or any Subservicer
and is responsible for the performance (whether directly or through Subservicers
or Subcontractors) of a substantial portion of the material servicing functions
required to be performed by the Company under this Agreement or any
Reconstitution Agreement that are identified in Item 1122(d) of Regulation
AB.
Subsidy
Account:
An
account maintained by the Company specifically to hold all Subsidy Funds
to be
applied to individual Subsidy Loans.
Subsidy
Agreement: An
agreement between the Company and a Mortgagor, or an agreement among the
Company, a Mortgagor and an employer of a Mortgagor with respect to a Mortgage
Loan which provides for the application of Subsidy Funds and pursuant to
which
the monthly interest payments made by the related Mortgagor will be less
than
the scheduled monthly interest payments on such Mortgage Loan, with the
resulting difference in interest payments being provided by the employer
of the
Mortgagor.
Subsidy
Funds:
With
respect to any Subsidy Loans, funds contributed by the employer of a Mortgagor
in order to reduce the payments required from the Mortgagor for a specified
period in specified amounts.
Subsidy
Loan:
Any
Mortgage Loan subject to a Subsidy Agreement. Each Subsidy Loan will be
identified as such in the related Data File.
Superior
Lien:
With
respect to any Second Lien Mortgage Loan, any other mortgage loan relating
to
the corresponding Mortgaged Property that creates a lien on the Mortgaged
Property that is senior to such Mortgage Loan.
Third-Party
Originator:
Each
Person, other than a Qualified Correspondent, that originated Mortgage Loans
acquired by the Company.
Underwriting
Guidelines:
The
underwriting guidelines of the Company, as provided by the Company to the
Purchaser from time to time, in effect at the time of origination of the
related
Mortgage Loan.
VA:
The
United States Department of Veterans Affairs, and its
successors.
-17-
VA
Mortgage Loan:
A
Mortgage Loan that has a LGC issued by the VA.
Whole
Loan Transfer:
Any
sale or transfer of some or all of the Mortgage Loans by the Purchaser to
a
third party, which sale or transfer is not an Agency Transfer or a
Securitization Transaction.
ARTICLE
II
CONVEYANCE
OF MORTGAGE LOANS; POSSESSION OF MORTGAGE
FILES;
BOOKS AND RECORDS; DELIVERY OF DOCUMENTS
Section
2.01 Conveyance
of Mortgage Loans; Possession of Mortgage Files; Maintenance of Servicing
Files.
The
Company agrees to sell and the Purchaser agrees to purchase, from time to
time,
those certain Mortgage Loans identified in a Mortgage Loan Schedule, at the
price and on the terms set forth herein and in the related Commitment Letter.
The Purchaser, on any Closing Date, shall be obligated to purchase only such
Mortgage Loans set forth in the applicable Mortgage Loan Schedule, subject
to
the terms and conditions of this Agreement, the related Assignment and
Conveyance Agreement and the related Commitment Letter. On the Closing Date
and
subject to the terms and conditions of this Agreement, the Company will sell,
transfer, assign, set over and convey to the Purchaser, without recourse,
but
subject to the terms of this Agreement and the related Assignment and Conveyance
Agreement, all the right, title and interest of the Company in and to the
Mortgage Loans identified on the related Mortgage Loan Schedule, including
all
interest and principal received by the Company on or with respect to the
related
Mortgage Loans after the applicable Cut-off Date (and including Monthly Payments
due after the Cut-off Date but received by the Company on or before the Cut-off
Date, but not including payments of principal and interest due on the Mortgage
Loans on or before the Cut-off Date). The Company and Purchaser shall execute
an
Assignment and Conveyance Agreement.
The
principal balance of each Mortgage Loan as of the Cut-off Date shall be
determined after application of payments of principal due on or before the
Cut-off Date whether or not collected. Therefore, payments of scheduled
principal and interest prepaid for a Due Date beyond the Cut-off Date shall
not
be applied to the principal balance as of the Cut-off Date. Such prepaid
amounts
(minus
interest
at the Servicing Fee Rate) shall be the property of the Purchaser. The Company
shall deposit any such prepaid amounts into the Custodial Account, which
account
is established for the benefit of the Purchaser for subsequent remittance
by the
Company to the Purchaser, and shall remit such amounts as provided in Section
5.01.
Pursuant
to Section 2.03, the Company has delivered the Mortgage Loan Documents to
the
Custodian. The contents of each Mortgage File not delivered to the Custodian
are
and shall be held in trust by the Company for the benefit of the Purchaser
as
the owner thereof. The Company shall maintain a Servicing File consisting
of a
copy of the contents of each Mortgage File and the originals of the documents
in
each Mortgage File not delivered to the Custodian. The possession of each
Servicing File by the Company is at the will of the Purchaser for the sole
purpose of servicing the related Mortgage Loan, and such retention and
possession by the Company is in a custodial capacity only. Upon the sale
of the
Mortgage Loans the ownership of each Mortgage Note, the related Mortgage
and the
related Mortgage File and Servicing File shall vest immediately in the
Purchaser, and the ownership of all records and documents with respect to
the
related Mortgage Loan prepared by or which come into the possession of the
Company shall vest immediately in the Purchaser and shall be retained and
maintained by the Company, in trust, at the will of the Purchaser and only
in
such custodial capacity. The Company shall release its custody of the contents
of any Servicing File only in accordance with written instructions from the
Purchaser, unless such release is required as incidental to the Company’s
servicing of the Mortgage Loans or is in connection with a repurchase of
any
Mortgage Loan pursuant to Section 2.03, 3.03 or 6.02.
-18-
In
addition, in connection with the assignment of any MERS Mortgage Loan, the
Company agrees that it will cause, at its own expense, the MERS®
System
to indicate that such Mortgage Loans have been assigned by the Company to
the
Purchaser in accordance with this Agreement by including (or deleting, in
the
case of Mortgage Loans which are repurchased in accordance with this Agreement)
in such computer files the information required by the MERS®
System
to identify the Purchaser of such Mortgage Loans. Prior to the assignment
of any
MERS Mortgage Loan, the Purchaser will provide the Company with the Purchaser’s
MERS registration number. The Company further agrees that it will not alter
the
information referenced in this paragraph with respect to any Mortgage Loan
during the term of this Agreement unless and until such Mortgage Loan is
repurchased in accordance with the terms of this Agreement.
Section
2.02 Books
and Records; Transfers of Mortgage Loans.
From
and
after the sale of the Mortgage Loans to the Purchaser all rights arising
out of
the Mortgage Loans including but not limited to all funds received on or
in
connection with the Mortgage Loans, shall be received and held by the Company
in
trust for the benefit of the Purchaser as owner of the Mortgage Loans, and
the
Company shall retain record title to the related Mortgages for the sole purpose
of facilitating the servicing and the supervision of the servicing of the
Mortgage Loans.
The
sale
of each Mortgage Loan shall be reflected on the Company’s balance sheet and
other financial statements as a sale of assets by the Company. The Company
shall
be responsible for maintaining, and shall maintain, a complete set of books
and
records for each Mortgage Loan which shall be marked clearly to reflect the
ownership of each Mortgage Loan by the Purchaser. In particular, the Company
shall maintain in its possession, available for inspection by the Purchaser,
or
its designee, and shall deliver to the Purchaser upon demand, evidence of
compliance with all federal, state and local laws, rules and regulations,
and
requirements of Xxxxxx Mae, Xxxxxxx Mac or GNMA, including but not limited
to
documentation as to the method used in determining the applicability of the
provisions of the Flood Disaster Protection Act of 1973, as amended, to the
Mortgaged Property, documentation evidencing insurance coverage and eligibility
of any condominium project for approval by Xxxxxx Mae, Xxxxxxx Mac or GNMA,
and
periodic inspection reports as required by Section 4.13. To the extent that
original documents are not required for purposes of realization of Liquidation
Proceeds or Insurance Proceeds, documents maintained by the Company may be
in
the form of microfilm or microfiche or such other reliable means of recreating
original documents, including but not limited to, optical imagery techniques
so
long as the Company complies with the requirements of the Xxxxxx Mae or Xxxxxxx
Mac Servicing Guide, as amended from time to time.
-19-
The
Company shall maintain with respect to each Mortgage Loan and shall make
available for inspection by any Purchaser or its designee the related Servicing
File during the time the Purchaser retains ownership of a Mortgage Loan and
thereafter in accordance with Applicable Laws.
The
Company shall keep at its servicing office books and records in which, subject
to such reasonable regulations as it may prescribe, the Company shall note
transfers of Mortgage Loans. No transfer of a Mortgage Loan may be made unless
such transfer is in compliance with the terms hereof. For the purposes of
this
Agreement, the Company shall be under no obligation to deal with any Person
with
respect to this Agreement or the Mortgage Loans unless the books and records
show such Person as the owner of the Mortgage Loan. The Purchaser may, subject
to the terms of this Agreement, sell and transfer one or more of the Mortgage
Loans. The Purchaser shall also advise the Company of the transfer. Upon
receipt
of notice of the transfer, the Company shall xxxx its books and records to
reflect the ownership of the Mortgage Loans of such assignee, and shall release
the previous Purchaser from its obligations hereunder with respect to the
Mortgage Loans sold or transferred. If the Company receives notification
of a
transfer, including a final loan schedule, less than five (5) Business Days
before the last Business Day of the month, the Company’s duties to remit and
report to the new purchaser(s) as required by Section 5 shall begin with
the
next Due Period.
Section
2.03 Delivery
of Documents.
The
Company shall deliver to the Custodian those Mortgage Loan Documents as required
by this Agreement with respect to each Mortgage Loan approximately five (5)
days
prior to the related Closing Date.
The
Custodian shall certify its receipt of all such Mortgage Loan Documents required
to be delivered pursuant to this Agreement. The Company will be responsible
for
the fees and expenses with respect to the delivery of those Mortgage Loan
Documents required to be delivered pursuant to this Agreement. The Company
will
be responsible for the fees and expenses related to the recording of the
initial
Assignments of Mortgage (including any fees and expenses related to any
preparation and recording of any intervening or prior assignments of the
Mortgage Loans to the Company or to any prior owners of or mortgagees with
respect to the Mortgage Loans). The Purchaser will be responsible for the
Custodian’s fees and expenses with respect to the initial inventory and
certification and maintenance of the Mortgage Loans on and after the Closing
Date, including costs associated with clearing exceptions.
-20-
Within
180 days after each Closing Date, the Company shall deliver to the Custodian
each of the documents described in Exhibit B not delivered pursuant to the
Agreement; provided,
however,
within
150 days after each Closing Date, the Company shall, with respect to
Non-Conventional Mortgage Loans, deliver to the Custodian the original MIC
or
LGC or Loan Note Guarantee, or an Officer’s Certificate, which shall
(i) state that the MIC or LGC or Loan Note Guarantee has not been delivered
to the Custodian due solely to a delay by the insuring agency, (ii) state
the amount of time generally required by the insuring agency to process the
MIC
or LGC or Loan Note Guarantee and (iii) specify the date the MIC or LGC or
Loan Note Guarantee will be delivered to the Purchaser. The Company will
be
required to deliver the MIC or LGC or Loan Note Guarantee to the Custodian
by
the date specified in clause (iii) above. An extension of the date
specified in clause (iii) above may be requested from the Custodian, which
consent shall not be unreasonably withheld.
The
Company shall forward to the Custodian original documents evidencing an
assumption, modification, consolidation or extension of any Mortgage Loan
entered into in accordance with Section 4.01 or 6.01 within one week of their
execution; provided,
however,
that
the Company shall provide the Custodian with a certified true copy of any
such
document submitted for recordation within ten (10) days of its execution,
and
shall provide the original of any document submitted for recordation or a
copy
of such document certified by the appropriate public recording office to
be a
true and complete copy of the original within sixty (60) days of its submission
for recordation.
In
the
event the public recording office is delayed in returning any original document,
the Company shall deliver to the Custodian within 240 days of its submission
for
recordation, a copy of such document and an Officer’s Certificate, which shall
(i) identify the recorded document; (ii) state that the recorded
document has not been delivered to the Custodian due solely to a delay by
the
public recording office, (iii) state the amount of time generally required
by the applicable recording office to record and return a document submitted
for
recordation, and (iv) specify the date the applicable recorded document
will be delivered to the Custodian. The Company will be required to deliver
such
document to the Custodian by the date specified in clause (iv) above. An
extension of the date specified in clause (iv) above may be requested from
the Purchaser, which consent shall not be unreasonably withheld.
Notwithstanding
the foregoing, if the originals or certified copies required in this Section
2.03 are not delivered as required within 180 days after each Closing Date
or as
otherwise extended as set forth above, the related Mortgage Loan shall, upon
request of the Purchaser, be repurchased by the Company in accordance with
Section 3.03 hereof; provided,
however,
that
the foregoing repurchase obligation shall not apply in the event the Company
cannot deliver such items due to a delay caused by the recording office in
the
applicable jurisdiction; provided
that the
Company shall deliver instead a recording receipt of such recording office
or,
if such recording receipt is not available, an Officer’s Certificate from the
Company confirming that such documents have been accepted for recording.
Any
such document shall be delivered to the Purchaser or its designee promptly
upon
receipt thereof from the related recording office.
-21-
If
the
Company, the Purchaser or the Custodian finds any document or documents
constituting a part of a Mortgage File pertaining to a Mortgage Loan to be
defective (or missing) in any material respect, and such defect or missing
document materially and adversely affects the value of the related Mortgage
Loan
or the interests of the Purchaser therein, the party discovering such defect
shall promptly so notify the Company. The Company shall have a period of
90 days
after receipt of such written notice within which to correct or cure any
such
defect. The Company hereby covenants and agrees that, if any material defect
cannot be corrected or cured, the Company will, upon the expiration of the
applicable cure period described above, repurchase the related Mortgage Loan
in
the manner set forth in Section 3.03; provided,
however,
that
with respect to any Mortgage Loan, if such defect constitutes a Qualification
Defect, any such repurchase must take place within seventy-five (75) days
of the
date such defect is discovered.
Notwithstanding
the foregoing, with respect to a Mortgage Loan, if, at the end of such 90-day
period, the Company delivers an Officer’s Certificate to the Purchaser
certifying that the Company is using good faith efforts to correct or cure
such
defect and identifying progress made, then the Purchaser shall grant the
Company
an extension to correct or cure such defect. The extension shall not extend
beyond (1) the date that is seventy-five (75) days after the date the
defect is discovered, or (2), if the defect is not a Qualification Defect
(as
evidenced by an Opinion of Counsel), the date that is thirty (30) days beyond
the original ninety (90) day cure period. If the defect is not a Qualification
Defect, additional thirty (30) day extensions may be obtained pursuant to
the
same procedure, as long as the Company demonstrates continued progress toward
a
correction or cure; provided
that no
extension shall be granted beyond 180 days from the date on which the Company
received the original notice of the defect.
Notwithstanding
the foregoing, with respect to a Mortgage Loan, the failure of the Purchaser
to
notify the Company of any defective or missing document in a Mortgage File
within such 90-day period, or the failure of the Purchaser to require the
Company to cure or repurchase the related Mortgage Loan upon expiration of
such
90-day period, shall not constitute a waiver of its rights hereunder, including
the rights with respect to a Mortgage Loan, to require the Company to repurchase
the affected Mortgage Loan and the right to indemnification pursuant to Section
3.03 hereof.
Section
2.04 Mortgage
Schedule.
On
each
Closing Date, the Company shall provide the Purchaser with certain information
constituting a listing of the Mortgage Loans to be purchased under this
Agreement (the “Mortgage Loan Schedule”) substantially in the form attached
hereto as Exhibit A. The Mortgage Loan Schedule shall conform to the definition
of “Mortgage Loan Schedule” hereunder.
Section
2.05 Examination
of Mortgage Files.
Prior
to
each Closing Date, the Company shall (a) deliver to the Purchaser in
escrow, for examination, the Mortgage File for each Mortgage Loan, including
a
copy of the Assignment of Mortgage, pertaining to each Mortgage Loan, or
(b) make the Mortgage Files available to the Purchaser for examination at
the Company’s offices or such other location as shall otherwise be agreed upon
by the Purchaser and the Company. Such examination may be made by the Purchaser
at any time before or after the related Closing Date or by any prospective
purchaser of the Mortgage Loans from the Purchaser, at any time after the
respective Closing Date upon prior reasonable notice to the Company. The
fact
that the Purchaser or any prospective purchaser of the Mortgage Loans has
conducted or has failed to conduct any partial or complete examination of
the
Mortgage Files shall not affect the Purchaser’s (or any of its successor’s)
rights to demand repurchase, substitution or other relief as provided under
this
Agreement.
-22-
Section
2.06 Representations,
Warranties and Agreements of the Company.
The
Company agrees and acknowledges that it shall, as a condition to the
consummation of the transactions contemplated hereby, make the representations
and warranties specified in Sections 3.01 and 3.02 as of the Closing Date
for
the related Mortgage Loans. The Company, without conceding that the Mortgage
Loans are securities, hereby further represents, warrants and agrees, as
of the
Closing Date for the related Mortgage Loans, that neither the Company nor
anyone
acting on its behalf has offered, transferred, pledged, sold or otherwise
disposed of any Mortgage Loans, any interest in any Mortgage Loans or any
other
similar security to, or solicited any offer to buy or accept a transfer,
pledge
or other disposition of any Mortgage Loans, any interest in any Mortgage
Loans
or any other similar security from, or otherwise approached or negotiated
with
respect to any Mortgage Loans, any interest in any Mortgage Loans or any
other
similar security with, any person in any manner, or made any general
solicitation by means of general advertising or in any other manner, or taken
any other action which would constitute a distribution of the Mortgage Loans
under the Securities Act, or which would render the disposition of any Mortgage
Loans a violation of Section 5 of the Securities Act or require registration
pursuant thereto, nor will it act, nor has it authorized or will it authorize
any person to act, in such manner with respect to the Mortgage
Loans.
Section
2.07 Representation,
Warranties and Agreement of Purchaser.
The
Purchaser, without conceding that the Mortgage Loans are securities, hereby
makes the following representations, warranties and agreements, which shall
be
deemed to have been made as of the Closing Date for the related Mortgage
Loans:
|
(i)
|
the
Purchaser understands that the Mortgage Loans have not been registered
under the Securities Act or the securities laws of any
state;
|
|
(ii)
|
the
Purchaser is acquiring the Mortgage Loans for its own account only
and not
for any other Person; and
|
|
(iii)
|
the
Purchaser considers itself a substantial, sophisticated institutional
investor having such knowledge and experience in financial and
business
matters that it is capable of evaluating the merits and risks of
investment in the Mortgage Loans.
|
-23-
Section
2.08 Closing.
The
closing for the purchase and sale of each pool of Mortgage Loans shall take
place on the related Closing Date. At the Purchaser’s option, each closing shall
be either performed by telephone, confirmed by letter or wire as the parties
shall agree or conducted in person, at such place as the parties shall
agree.
Each
closing shall be subject to each of the following conditions:
|
(i)
|
all
of the representations and warranties of the Company under this
Agreement
shall be true and correct as of the related Closing Date and no
event
shall have occurred which, with notice or the passage of time,
would
constitute a default under this
Agreement;
|
|
(ii)
|
the
Purchaser shall have received, or the Purchaser’s attorneys shall have
received in escrow, all Closing Documents for the related Mortgage
Loans
as specified in Section 2.09 of this Agreement, in such forms as
are
agreed upon and acceptable to the Purchaser, duly executed by all
signatories other than the Purchaser as required pursuant to the
respective terms thereof;
|
|
(iii)
|
the
Company shall have delivered to the Custodian all documents required
pursuant to this Agreement, and
|
|
(iv)
|
all
other terms and conditions of this Agreement shall have been complied
with.
|
Subject
to the foregoing conditions, the Purchaser shall pay to the Company on each
Closing Date the Purchase Price for the related Mortgage Loans by wire transfer
of immediately available funds to the account designated by the Company and
the
Company shall release all documents required pursuant to this
Agreement.
Section
2.09 Closing
Documents.
With
respect to each pool of Mortgage Loans, the closing documents shall consist
of
fully executed originals of the following documents:
On
the
initial Closing Date:
|
(i)
|
this
Agreement, in two counterparts;
|
|
(ii)
|
an
Assignment and Conveyance Agreement for the related Mortgage
Loans;
|
|
(iii)
|
the
Commitment Letter, in two
counterparts;
|
|
(iv)
|
the
related Mortgage Loan Schedule, one copy to be attached to the
related
Assignment and Conveyance
Agreement;
|
-24-
|
(v)
|
a
receipt and certification, as required under the Custodial
Agreement;
|
|
(vi)
|
an
officer’s certificate of the Company substantially in the form of Exhibit
G attached hereto; and
|
|
(vii)
|
an
Opinion of Counsel of the Company, in the form of Exhibit D attached
hereto.
|
On
each
subsequent Closing Date, the following documents:
(i) the
Commitment Letter relating to each pool of Mortgage Loans;
(ii)
the
Mortgage Loan Schedule for the related pool of Mortgage Loans;
|
(iii)
|
an
Assignment and Conveyance Agreement for the related pool of Mortgage
Loans; and
|
(iii)
a
receipt
and certification, as required under the Custodial Agreement.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES REMEDIES AND BREACH
Section
3.01 Company
Representations and Warranties.
The
Company hereby represents and warrants to the Purchaser that, as of each
Closing
Date:
|
(a)
|
Due
Organization and Authority.
|
The
Company is a national banking association duly organized, validly existing
and
in good standing under the laws of the United States and has all licenses
necessary to carry on its business as now being conducted and is licensed,
qualified and in good standing in each state where a Mortgaged Property is
located if the laws of such state require licensing or qualification in order
to
conduct business of the type conducted by the Company, and in any event the
Company is in compliance with the laws of any such state to the extent necessary
to ensure the enforceability of the related Mortgage Loan and the servicing
of
such Mortgage Loan in accordance with the terms of this Agreement; the Company
has the full power and authority to execute and deliver this Agreement and
to
perform in accordance herewith; the execution, delivery and performance of
this
Agreement (including all instruments of transfer to be delivered pursuant
to
this Agreement) by the Company and the consummation of the transactions
contemplated hereby have been duly and validly authorized; this Agreement
evidences the valid, binding and enforceable obligation of the Company; and
all
requisite action has been taken by the Company to make this Agreement valid
and
binding upon the Company in accordance with its terms;
-25-
|
(b)
|
Ordinary
Course of Business.
|
The
consummation of the transactions contemplated by this Agreement are in the
ordinary course of business of the Company, which is in the business of selling
and servicing loans, and the transfer, assignment and conveyance of the Mortgage
Notes and the Mortgages by the Company pursuant to this Agreement are not
subject to the bulk transfer or any similar statutory provisions in effect
in
any applicable jurisdiction;
|
(c)
|
No
Conflicts.
|
Neither
the execution and delivery of this Agreement, the acquisition of the Mortgage
Loans by the Company, the sale of the Mortgage Loans to the Purchaser or
the
transactions contemplated hereby, nor the fulfillment of or compliance with
the
terms and conditions of this Agreement will conflict with or result in a
breach
of any of the terms, articles of incorporation or by-laws or any legal
restriction or any agreement or instrument to which the Company is now a
party
or by which it is bound, or constitute a default or result in the violation
of
any law, rule, regulation, order, judgment or decree to which the Company
or its
property is subject, or impair the ability of the Purchaser to realize on
the
Mortgage Loans, or impair the value of the Mortgage Loans;
|
(d)
|
Ability
to Service.
|
The
Company is an approved seller/servicer of residential mortgage loans for
HUD, VA
and GNMA with the facilities, procedures, and experienced personnel necessary
for the sound servicing of mortgage loans of the same type as the Mortgage
Loans. The Company is in good standing to sell mortgage loans to and service
mortgage loans for HUD, VA and GNMA, and no event has occurred, including
but
not limited to a change in insurance coverage, which would make the Company
unable to comply with HUD, VA and GNMA, eligibility requirements or which
would
require notification to HUD, VA and GNMA;
|
(e)
|
Reasonable
Servicing Fee.
|
The
Company acknowledges and agrees that the Servicing Fee represents reasonable
compensation for performing such services and that the entire Servicing Fee
shall be treated by the Company, for accounting and tax purposes, as
compensation for the servicing and administration of the Mortgage Loans pursuant
to this Agreement;
|
(f)
|
Ability
to Perform.
|
The
Company does not believe, nor does it have any reason or cause to believe,
that
it cannot perform each and every covenant contained in this Agreement. The
Company is solvent and the sale of the Mortgage Loans will not cause the
Company
to become insolvent. The sale of the Mortgage Loans is not undertaken to
hinder,
delay or defraud any of the Company’s creditors;
-26-
|
(g)
|
No
Litigation Pending.
|
There
is
no action, suit, proceeding or investigation pending or threatened against
the
Company which, either in any one instance or in the aggregate, may result
in any
material adverse change in the business, operations, financial condition,
properties or assets of the Company, or in any material impairment of the
right
or ability of the Company to carry on its business substantially as now
conducted, or in any material liability on the part of the Company, or which
would draw into question the validity of this Agreement or the Mortgage Loans
or
of any action taken or to be contemplated herein, or which would be likely
to
impair materially the ability of the Company to perform under the terms of
this
Agreement;
|
(h)
|
No
Consent Required.
|
No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Company
of
or compliance by the Company with this Agreement or the sale of the Mortgage
Loans as evidenced by the consummation of the transactions contemplated by
this
Agreement, or if required, such approval has been obtained prior to the Closing
Date;
|
(i)
|
No
Untrue Information.
|
Neither
this Agreement nor any statement, report or other document furnished or to
be
furnished pursuant to this Agreement or in connection with the transactions
contemplated hereby contains any untrue statement of fact or omits to state
a
fact necessary to make the statements contained therein not
misleading;
|
(j)
|
Sale
Treatment.
|
The
Company has determined that the disposition of the Mortgage Loans pursuant
to
this Agreement will be afforded sale treatment for accounting and tax
purposes;
|
(k)
|
No
Material Change.
|
There
has
been no material adverse change in the business, operations, financial condition
or assets of the Company since the date of the Company’s most recent financial
statements;
|
(l)
|
No
Brokers’ Fees.
|
The
Company has not dealt with any broker, investment banker, agent or other
Person
that may be entitled to any commission or compensation in connection with
the
sale of the Mortgage Loans; and
|
(m)
|
MERS
Status.
|
The
Company is a member of MERS in good standing.
-27-
Section
3.02 Representations
and Warranties Regarding Individual Mortgage Loans.
As
to
each Mortgage Loan, the Company hereby represents and warrants to the Purchaser
that as of the related Closing Date:
|
(i)
|
Mortgage
Loans as Described.
|
The
information set forth in the Mortgage Loan Schedule attached to the related
Assignment and Conveyance Agreement as Schedule A is true and correct;
|
(ii)
|
No
Outstanding Charges.
|
There
are
no defaults by the Company in complying with the terms of the Mortgage Note
or
Mortgage, and all taxes, governmental assessments, insurance premiums, water,
sewer and municipal charges, which previously became due and owing have been
paid, or an escrow of funds has been established for every such item which
remains unpaid and which has been assessed but is not yet due and
payable;
|
(iii)
|
Original
Terms Unmodified.
|
The
terms
of the Mortgage Note and Mortgage have not been impaired, waived, altered
or
modified in any respect, except by a written instrument which has been recorded,
if necessary to protect the interests of the Purchaser, and which has been
delivered to the Purchaser. The substance of any such waiver, alteration
or
modification has been approved by the applicable mortgage insurer, if the
Mortgage Loan is insured, and the title insurer, to the extent required by
the
policy, or, with respect to the Non-Conventional Mortgage Loans, FHA or VA
or
RHS, as applicable, and its terms are reflected on the Mortgage Loan Schedule.
No Mortgagor has been released, in whole or in part, except in connection
with
an assumption agreement approved by the title insurer, to the extent required
by
the policy or agency guidelines, and with respect to the Non-Conventional
Mortgage Loans, the issuer of the MIC or LGC or Loan Note Guarantee, as
applicable, and which assumption agreement is part of the Mortgage File
delivered to the Purchaser and the terms of which are reflected in the Mortgage
Loan Schedule;
|
(iv)
|
No
Defenses.
|
The
Mortgage Loan is not subject to any right of rescission, set-off, counterclaim
or defense, including without limitation the defense of usury, nor will the
operation of any of the terms of the Mortgage Note or the Mortgage, or the
exercise of any right thereunder, render either the Mortgage Note or the
Mortgage unenforceable, in whole or in part, or subject to any right of
rescission, set-off, counterclaim or defense, including without limitation
the
defense of usury, and no such right of rescission, set-off, counterclaim
or
defense has been asserted with respect thereto;
-28-
|
(v)
|
No
Satisfaction of Mortgage.
|
The
Mortgage has not been satisfied, canceled, subordinated or rescinded, in
whole
or in part, and the Mortgaged Property has not been released from the lien
of
the Mortgage, in whole or in part, nor has any instrument been executed that
would effect any such satisfaction, release, cancellation, subordination
or
rescission;
|
(vi)
|
Validity
of Mortgage Documents.
|
The
Mortgage Note and the Mortgage and related documents are genuine, and each
is
the legal, valid and binding obligation of the maker thereof enforceable
in
accordance with its terms. All parties to the Mortgage Note and the Mortgage
had
legal capacity to enter into the Mortgage Loan and to execute and deliver
the
Mortgage Note and the Mortgage, and the Mortgage Note and the Mortgage have
been
duly and properly executed by such parties;
|
(vii)
|
No
Fraud.
|
All
the
documents executed in connection with the Mortgage Loan including, but not
limited to, the Mortgage Note and the Mortgage are, to the best of the Company’s
knowledge, free of fraud and any misrepresentation, are signed by the persons
they purport to be signed by, and witnessed or, as appropriate, notarized
by the
persons whose signatures appear as witnesses or notaries, and each such document
constitutes the valid and binding legal obligation of the signatories and
is
enforceable in accordance with its terms;
|
(viii)
|
Compliance
with Applicable Laws.
|
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, abusive lending or disclosure
laws
applicable to the Mortgage Loan have been complied with, and the Company
shall
maintain in its possession, available for the Purchaser’s inspection, and shall
deliver to the Purchaser upon demand, evidence of compliance with all such
requirements. All inspections, licenses and certificates required to be made
or
issued with respect to all occupied portions of the Mortgaged Property and,
with
respect to the use and occupancy of the same, including but not limited to
certificates of occupancy and fire underwriting certificates, have been made
or
obtained from the appropriate authorities;
-29-
|
(ix)
|
Location
and Type of Mortgaged Property.
|
The
Mortgaged Property is located in the state identified in the Mortgage Loan
Schedule and consists of a single parcel (or more than one contiguous parcels)
of real property with a detached single family residence erected thereon,
or a
two- to four-family dwelling, or a Cooperative Apartment, or a manufactured
dwelling, or an individual condominium unit in a condominium project, or
an
individual unit in a planned unit development or a townhouse; provided,
however,
that,
any condominium project or planned unit development shall conform, if a
Non-Conventional Mortgage Loan, with the applicable HUD or VA requirements,
regarding such dwellings and no residence or dwelling is a mobile home. As
of
the respective appraisal date for each Mortgaged Property, no portion of
the
Mortgaged Property was being used for commercial purposes outside of the
HUD or
VA requirements for Non-Conventional Mortgage Loans or outside of the
Underwriting Guidelines for Conventional Mortgage Loans. With respect to
the
Non-Conventional Mortgage Loans, if the Mortgaged Property is a condominium
unit
or a planned unit development (other than a de minimis
planned
unit development), such condominium or planned unit development project meets
HUD or VA eligibility requirements or is located in a condominium or planned
unit development project which has received HUD or VA project approval and
the
representations and warranties required by HUD or VA with respect to such
condominium or planned unit development have been made and remain true and
correct in all respects;
|
(x)
|
Valid
First Lien.
|
The
Mortgage is a valid, subsisting and enforceable first lien on the Mortgaged
Property, including all buildings on the Mortgaged Property and all
installations and mechanical, electrical, plumbing, heating and air conditioning
systems located in or annexed to such buildings, and all additions, alterations
and replacements made at any time with respect to the foregoing. The lien
of the
Mortgage is subject only to:
a. the
lien
of current real property taxes and assessments not yet due and
payable;
b. covenants,
conditions and restrictions, rights of way, easements and other matters of
the
public record as of the date of recording acceptable to mortgage lending
institutions generally and specifically referred to in the lender’s title
insurance policy or attorney’s title opinion delivered to the originator of the
Mortgage Loan and (i) referred to or otherwise considered in the appraisal
made for the originator of the Mortgage Loan and (ii) which do not
adversely affect the Appraised Value of the Mortgaged Property set forth
in such
appraisal; and
-30-
c. other
matters to which like properties are commonly subject which do not materially
interfere with the benefits of the security intended to be provided by the
mortgage or the use, enjoyment, value or marketability of the related Mortgaged
Property.
Any
security agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates a
valid,
subsisting and enforceable first lien and first priority security interest
on
the property described therein, and the Company has full right to sell and
assign the same to the Purchaser;
|
(xi)
|
Full
Disbursement of Proceeds.
|
The
proceeds of the Mortgage Loan have been fully disbursed, except for escrows
established or created due to seasonal weather conditions, and there is no
requirement for future advances thereunder. All costs, fees and expenses
incurred in making or closing the Mortgage Loan and the recording of the
Mortgage were paid, and the Mortgagor is not entitled to any refund of any
amounts paid or due under the Mortgage Note or Mortgage;
|
(xii)
|
Ownership.
|
The
Company is the sole owner of record and holder of the Mortgage Loan and the
related Mortgage Note and the Mortgage are not assigned or pledged, and the
Company has good and marketable title thereto and has full right and authority
to transfer and sell the Mortgage Loan to the Purchaser. The Company is
transferring the Mortgage Loan free and clear of any and all encumbrances,
liens, pledges, equities, participation interests, claims, charges or security
interests of any nature encumbering such Mortgage Loan;
|
(xiii)
|
Origination/Doing
Business.
|
The
Mortgage Loan was originated by a savings and loan association, a savings
bank,
a commercial bank, a credit union, an insurance company, or similar institution
which is supervised and examined by a federal or state authority or by a
mortgagee approved by the Secretary of Housing and Urban Development pursuant
to
Sections 203 and 211 or the National Housing Act. All parties which have
had any
interest in the Mortgage Loan, whether as mortgagee, assignee, pledgee or
otherwise, are (or, during the period in which they held and disposed of
such
interest, were) (1) in compliance with any and all applicable licensing
requirements of the laws of the state wherein the Mortgaged Property is located,
and any qualification requirements of, with respect to the Non-Conventional
Mortgage Loans, FHA or VA or RHS, as applicable, or GNMA, or, with respect
to
the Conventional Mortgage Loans, Xxxxxx Xxx or Xxxxxxx Mac and
(2) organized under the laws of such state, or (3) qualified to do
business in such state, or (4) federal savings and loan associations or
national banks having principal offices in such state, or (5) not doing
business in such state;
-31-
|
(xiv)
|
FHA
Insurance/VA Guaranty/RHS Guaranty.
|
|
a.
|
Each
FHA Mortgage Loan was underwritten in accordance with FHA standards
and is
fully-insured by the FHA, which insurance is in full force and
effect, and
the Mortgage Loan is not subject to any defect which would diminish
or
impair the FHA insurance, and all prior transfers, if any, of the
Mortgage
Loan have been, and the transactions herein contemplated are, in
compliance with the FHA regulations, and no circumstances exist
with
respect to the FHA Mortgage Loans which would permit the FHA to
deny
coverage under the FHA insurance;
|
|
b.
|
Each
VA Mortgage Loan was underwritten in accordance with VA standards
and is
guaranteed by the VA, which guaranty is in full force and effect,
and the
Mortgage Loan is not subject to any defect which would diminish
or impair
the VA guaranty (other than a potential valuation of the mortgaged
property), and all prior transfers, if any, of the Mortgage Loan
have
been, and the transactions herein contemplated are, in compliance
with the
VA regulations, and no circumstances exist with respect to the
VA Mortgage
Loan which would permit the VA to deny coverage under the VA
guaranty;
|
|
c.
|
Each
RHS Mortgage Loan was underwritten in accordance with RHS standards
and is
guaranteed by the RHS, and each related Loan Note Guarantee is
in full
force and effect, and the Mortgage Loan is not subject to any defect
which
would diminish or impair the Loan Note Guarantee (other than a
potential
valuation of the mortgaged property), and all prior transfers,
if any, of
the Mortgage Loan have been, and the transactions herein contemplated
are,
in compliance with RHS regulations, and no circumstances exist
with
respect to the RHS Mortgage Loan which would permit the RHS to
deny
coverage under the RHS
guaranty;
|
-32-
|
d.
|
No
Mortgage Loan is a VA Vendee Loan, Title I Loan or Section 235
Loan;
and
|
|
e.
|
Each
Non-Conventional Mortgage Loan was previously included in a GNMA
mortgage
loan pool and was repurchased from such pool, in accordance with
applicable GNMA guidelines, by the Company or a predecessor servicer,
after such Mortgage Loan missed one or more Monthly Payments and
remained
delinquent for ninety (90) consecutive days or
more;
|
|
(xv)
|
Title
Insurance.
|
The
Mortgage Loan is covered by an ALTA lender’s title insurance policy or other
generally acceptable form of policy of insurance acceptable to, with respect
to
the Non-Conventional Mortgage Loans, GNMA, FHA, VA or RHS, as applicable,
or,
with respect to the Conventional Mortgage Loans, Xxxxxx Xxx or Xxxxxxx Mac,
issued by a title insurer acceptable to, with respect to the Non-Conventional
Mortgage Loans, GNMA, FHA, VA or RHS, as applicable, or, for Conventional
Mortgage Loans, Xxxxxx Mae or Xxxxxxx Mac, and qualified to do business in
the
jurisdiction where the Mortgaged Property is located, insuring the Company,
its
successors and assigns, as to the first priority lien (or second priority
if
such Mortgage Loan is a Second Lien Mortgage Loan) of the Mortgage in the
original principal amount of the Mortgage Loan, subject only to the exceptions
contained in clauses (a), (b) and (c) of paragraph (x) of this
Section 3.02; provided,
however,
that in
the case of any Mortgage Loan secured by a Mortgaged Property located in
a
jurisdiction where such policies are generally not available, the Mortgage
Loan
is the subject of an opinion of counsel of the type customarily rendered
in such
jurisdiction in lieu of title insurance. The Company is the sole insured
of such
lender’s title insurance policy, and such lender’s title insurance policy is in
full force and effect and will be in force and effect upon the consummation
of
the transactions contemplated by this Agreement. No claims have been made
under
such lender’s title insurance policy, and no prior holder of the Mortgage,
including the Company, has done, by act or omission, anything which would
impair
the coverage of such lender’s title insurance policy;
|
(xvi)
|
No
Mechanics’ Liens.
|
There
are
no mechanics’ or similar liens or claims which have been filed for work, labor
or material (and no rights are outstanding that under the law could give
rise to
such liens) affecting the related Mortgaged Property which are or may be
liens
prior to, or equal or coordinate with, the lien of the related Mortgage which
are not insured against by the title insurance policy referenced in clause
(xv)
above and (xlix) below;
-33-
|
(xvii)
|
Location
of Improvements; No Encroachments.
|
Except
as
insured against by the title insurance policy referenced in clause (xv) above,
all improvements which were considered in determining the Appraised Value
of the
Mortgaged Property lay wholly within the boundaries and building restriction
lines of the Mortgaged Property and no improvements on adjoining properties
encroach upon the Mortgaged Property. No improvement located on or being
part of
the Mortgaged Property is in violation of any applicable zoning law or
regulation;
|
(xviii)
|
Customary
Provisions.
|
The
Mortgage contains customary and enforceable provisions such as to render
the
rights and remedies of the holder thereof adequate for the realization against
the Mortgaged Property of the benefits of the security provided thereby,
including, (i) in the case of a Mortgage designated as a deed of trust, by
trustee’s sale, and (ii) otherwise by judicial foreclosure. There is no
homestead or other exemption available to a Mortgagor which would interfere
with
the right to sell the Mortgaged Property at a trustee’s sale or the right to
foreclose the Mortgage;
|
(xix)
|
Occupancy
of the Mortgaged Property.
|
As
of the
date of origination, the Mortgaged Property was lawfully occupied under
Applicable Law;
|
(xx)
|
No
Additional Collateral.
|
Except
in
the case of a Pledged Asset Mortgage Loan, the Mortgage Note is not and has
not
been secured by any collateral, pledged account or other security except
the
lien of the corresponding Mortgage and the security interest of any applicable
security agreement or chattel mortgage referred to in clause (x)
above;
|
(xxi)
|
Deeds
of Trust.
|
In
the
event that the Mortgage constitutes a deed of trust, a trustee, duly qualified
under Applicable Law to serve as such, has been properly designated and
currently so serves and is named in the Mortgage, and no fees or expenses
are or
will become payable by the Mortgagee to the trustee under the deed of trust,
except in connection with a trustee’s sale after default by the
Mortgagor;
-34-
|
(xxii)
|
Transfer
of Mortgage Loans.
|
As
to any
Mortgage Loan which is not a MERS Mortgage Loan, the Assignment of Mortgage
is
in recordable form and is acceptable for recording under the laws of the
jurisdiction in which the Mortgaged Property is located;
|
(xxiii)
|
Mortgaged
Property Undamaged.
|
The
Mortgaged Property is undamaged by water, fire, earthquake or earth movement,
windstorm, flood, tornado or other casualty so as to affect adversely the
value
of the Mortgaged Property as security for the Mortgage Loan or the use for
which
the premises were intended;
|
(xxiv)
|
Collection
Practices; Escrow Deposits.
|
The
origination and collection practices used with respect to the Mortgage Loan
have
been in accordance with Acceptable Servicing Practices, and have been in
all
material respects legal and proper, and in accordance with the terms of the
Mortgage Note and Mortgage or, with respect to the Non-Conventional Mortgage
Loans, rules and regulations of FHA, VA or RHS, as applicable, including
those
rules, regulations and guidelines relating to loss mitigation. All Escrow
Payments have been collected in full compliance with state and federal law.
An
escrow of funds is not prohibited by Applicable Law and has been established
to
pay for every item that remains unpaid and has been assessed but is not yet
due
and payable. No escrow deposits or Escrow Payments or other charges or payments
due the Company have been capitalized under the Mortgage Note. For Adjustable
Rate Mortgage Loans, all Mortgage Interest Rate adjustments have been made
in
compliance with state and federal law and the terms of the related Mortgage
and
Mortgage Note on the related Interest Rate Adjustment Date;
|
(xxv)
|
No
Condemnation.
|
To
the
best of Company’s knowledge, there is no proceeding pending or threatened for
the total or partial condemnation of the related Mortgaged
Property;
|
(xxvi)
|
The
Appraisal.
|
The
Mortgage File contains an appraisal of the related Mortgaged Property by
an
appraiser who had no interest, direct or indirect, in the Mortgaged Property
or
in any loan made on the security thereof; and whose compensation is not affected
by the approval or disapproval of the Mortgage Loan, and the appraisal and
the
appraiser both satisfy the applicable requirements of, with respect to the
Non-Conventional Mortgage Loans, FHA, VA or RHS, as applicable, or with respect
to the Conventional Mortgage Loans, Xxxxxx Xxx or Xxxxxxx Mac;
-35-
|
(xxvii)
|
Insurance.
|
The
Mortgaged Property securing each Mortgage Loan is insured by an insurer
acceptable to, with respect to the Non-Conventional Mortgage Loans, FHA,
VA or
RHS, as applicable, or with respect to the Conventional Mortgage Loans, Xxxxxx
Mae or Xxxxxxx Mac against loss by fire and such hazards as are covered under
a
standard extended coverage endorsement, in an amount which is at least equal
to
the lesser of (a) 100% of the insurable value, on a replacement cost basis,
of
the improvements on the related Mortgaged Property or (b) the greater of
(i)
either (1) the outstanding principal balance of the Mortgage Loan with respect
to each First Lien Mortgage Loan or (2) with respect to each Second Lien
Mortgage Loan, the sum of the outstanding principal balance of the first
lien on
such Mortgage Loan and the outstanding principal balance of such Second Lien
Mortgage Loan, or (ii) an amount such that the proceeds of such insurance
shall
be sufficient to prevent the application to the Mortgagor or the loss payee
of
any coinsurance clause under the policy. If the Mortgaged Property is a
condominium unit, it is included under the coverage afforded by a blanket
policy
for the project; the insurance policy contains a standard clause naming the
originator of such mortgage loan, its successor and assigns, as insured
mortgagee; if upon origination of the Mortgage Loan, the improvements on
the
Mortgaged Property were in an area identified in the Federal Register by
the
Federal Emergency Management Agency as having special flood hazards, a flood
insurance policy meeting the requirements of the current guidelines of the
Federal Insurance Administration is in effect with a generally acceptable
insurance carrier, in an amount representing coverage not less than the least
of
(A) the outstanding principal balance of the Mortgage Loan, (B) the
full insurable value and (C) the maximum amount of insurance which was
available under the Flood Disaster Protection Act of 1973, as amended; and
the
Mortgage obligates the Mortgagor thereunder to maintain all such insurance
at
the Mortgagor’s cost and expense and the Company has not acted or failed to act
so as to impair the coverage of any such insurance policy or the validity,
binding effect and enforceability thereof;
|
(xxviii)
|
Servicemembers
Civil Relief Act.
|
The
Mortgagor has not notified the Company, and the Company has no knowledge
of any
relief requested or allowed to the Mortgagor under the Servicemembers Civil
Relief Act, as amended;
-36-
|
(xxix)
|
Payment
Terms.
|
Except
with respect to the Interest Only Mortgage Loans, the Mortgage Note is payable
each month in equal monthly installments of principal and interest, which
with
respect to Adjustable Rate Mortgage Loans the installments of interest are
subject to change due to the adjustments to the Mortgage Interest Rate on
each
Interest Rate Adjustment Date, with interest in arrears, sufficient to amortize
the Mortgage Loan fully by the stated maturity date, providing for full
amortization by maturity over a scheduled term of no more than 30 years from
origination and once the amortization period starts, payments are calculated
to
fully amortize by maturity. No Mortgage Loan has a shared appreciation or
other
contingent interest feature, or permits negative amortization;
|
(xxx)
|
No
Defaults.
|
Except
with respect to delinquencies identified on the Mortgage Loan Schedule, there
is
no default, breach, violation or event of acceleration existing under any
Mortgage or Mortgage Note 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, breach, violation or event of acceleration, and the Company has
not
waived any default, breach, violation or event of acceleration;
|
(xxxi)
|
No
Bankruptcy.
|
To
the
best of the Company’s knowledge, no Mortgagor was a debtor in any state or
federal bankruptcy or insolvency proceeding at the time the Mortgage Loan
was
originated and as of the Closing Date, except as identified on the Mortgage
Loan
Schedule, the Company has not received notice that any Mortgagor is a debtor
under any state or federal bankruptcy or insolvency proceeding.
|
(xxxii)
|
Loan-to-Value
Ratio; No Foreclosures.
|
The
Loan-to-Value Ratio of each Mortgage Loan is as stated on the Mortgage Loan
Schedule. Except as identified on the Mortgage Loan Schedule, no Mortgage
Loan
is subject to active foreclosure proceedings;
|
(xxxiii)
|
Underwriting
Guidelines.
|
The
Mortgage Loan was underwritten in accordance with the Company’s underwriting
guidelines in effect at the time of origination with exceptions thereto
exercised in a reasonable manner;
-37-
|
(xxxiv)
|
Primary
Mortgage Insurance.
|
Each
Conventional Mortgage Loan with an LTV at origination in excess of 80% that
the
Mortgage Loan Schedule indicates as having a PMI Policy will be subject to
a PMI
Policy or LPMI Policy, issued by an insurer acceptable to Xxxxxx Xxx or Xxxxxxx
Mac, in at least such amounts as are required by Xxxxxxx Mac or Xxxxxx Xxx.
At
its origination, no Mortgage Loan secured by a second lien on the Mortgaged
Property has a CLTV greater than 100%. All provisions of such PMI Policy
or LPMI
Policy have been and are being complied with, such policy is in full force
and
effect, and all premiums due thereunder have been paid. Any Mortgage Loan
subject to any such PMI Policy or LPMI Policy obligates the Mortgagor or
Company, as applicable, to maintain such insurance and to pay all premiums
and
charges in connection therewith unless terminable in accordance with Xxxxxxx
Mac
or Xxxxxx Xxx standards or Applicable Law;
|
(xxxv)
|
No
Additional Payments.
|
There
is
no obligation on the part of the Company or any other party to make payments
in
addition to those made by the Mortgagor;
|
(xxxvi)
|
Comparable
Mortgage File.
|
Each
document or instrument in the related Mortgage File is in a form generally
acceptable to prudent mortgage lenders that regularly originate or purchase
mortgage loans comparable to the Mortgage Loans for sale to prudent investors
in
the secondary market that invest in mortgage loans such as the Mortgage
Loans;
|
(xxxvii)
|
High
Cost Loans.
|
No
Mortgage Loan is a High Cost Loan or Covered Loan;
|
(xxxviii)
|
Fair
Credit Reporting Act.
|
The
Company, in its capacity as servicer for each Mortgage Loan, has fully
furnished, in accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (e.g.,
favorable and unfavorable) on its borrower credit files to Equifax, Experian
and
Trans Union Credit Information Company (three of the credit repositories),
on a
monthly basis;
|
(xxxix)
|
No
Credit Insurance Policies.
|
No
proceeds from any Mortgage Loan were used to purchase single-premium credit
insurance policies;
-38-
|
(xl)
|
Prepayment
Penalty Term.
|
No
Mortgage Loan originated on or after October 1, 2002 will impose a prepayment
premium for a term in excess of three years after its origination. No Mortgage
Loan originated before October 1, 2002 will impose a prepayment premium for
a
term in excess of five years after its origination;
|
(xli)
|
No
Violation of Environmental Laws.
|
To
the
best of the Company's knowledge, there is no pending action or proceeding
directly involving the Mortgaged Property in which compliance with any
environmental law, rule or regulation is an issue; there is no violation
of any
environmental law, rule or regulation with respect to the Mortgage Property;
and
nothing further remains to be done to satisfy in full all requirements of
each
such law, rule or regulation constituting a prerequisite to use and enjoyment
of
said property;
|
(xlii)
|
No
Arbitration Provision.
|
No
Mortgage Loan originated on or after August 1, 2004 requires the related
Mortgagor to submit to arbitration to resolve any dispute arising out of
or
relating in any way to the Mortgage Loan transaction;
|
(xliii)
|
Tax
Service Contract; Flood Certification Contract.
|
Each
Mortgage Loan shall have a tax service contract and, if applicable, a flood
insurance contract which shall have a term of the life of the Mortgage Loan.
Each such tax service and flood insurance contract shall be fully transferable
without penalty, premium or cost to the Purchaser or its designee, unless,
with
respect to tax service contract, the Company is terminated pursuant to Section
11.02 hereof;
(xliv)
Subsidy
Mortgage Loans.
With
respect to each Mortgage Loan that is a Subsidy Mortgage Loan:
(1) On
or
before the date of origination of such Mortgage Loan, the Company and the
Mortgagor, or the Company, the Mortgagor and the employer of the Mortgagor
entered into a Subsidy Agreement. The Subsidy Agreement provides that the
employer of the Mortgagor shall deliver to the Company Subsidy Funds in an
amount equal to the aggregate undiscounted amount of payments that, when
added
to the amount the Mortgagor on such Mortgage Loan is obligated to pay on
each
Due Date in accordance with the terms of the Subsidy Agreement, is equal
to the
full scheduled Monthly Payment due on such Mortgage Loan. The Subsidy Funds
enable the Mortgagor to qualify for the Subsidy Mortgage Loan. The effective
interest rate of a Subsidy Mortgage Loan if less than the interest rate set
forth in the related Mortgage Note will increase within the Subsidy Period
as
provided in the related Subsidy Agreement so that the effective interest
rate
will be equal to the interest rate as set forth in the related Mortgage Note.
All Subsidy Funds required to make the full payment of principal and interest
under each Subsidy Loan are in the Subsidy Account held by the Company in
its
capacity as servicer. The Subsidy Mortgage Loan satisfies the Underwriting
Guidelines;
-39-
(2) The
Mortgage and Mortgage Note reflect the permanent payment terms rather than
the
payment terms of the Subsidy Agreement. The Subsidy Agreement provides for
the
payment by the Mortgagor of the full amount of the Monthly Payment on any
Due
Date that the Subsidy Funds are not available. The Subsidy Funds were not
used
to reduce the original principal balance of the Mortgage Loan or to increase
the
Appraised Value of the Mortgage Property when calculating the Loan-to-Value
Ratios for purposes of the Agreement;
(3) The
Subsidy Funds may not be refunded to the Mortgagor unless the Mortgagor makes
a
principal payment for the outstanding balance of the Mortgage Loan;
(xlv)
Buydown
Mortgage Loans.
With
respect to each Mortgage Loan that is a Buydown Mortgage Loan:
(1) On
or
before the date of origination of such Mortgage Loan, the Company and the
Mortgagor, or the Company, the Mortgagor and the seller of the Mortgaged
Property or a third party entered into a Buydown Agreement. The Buydown
Agreement provides that the seller of the Mortgaged Property (or third party)
shall deliver to the Company temporary Buydown Funds in an amount equal to
the
aggregate undiscounted amount of payments that, when added to the amount
the
Mortgagor on such Mortgage Loan is obligated to pay on each Due Date in
accordance with the terms of the Buydown Agreement, is equal to the full
scheduled Monthly Payment due on such Mortgage Loan. The temporary Buydown
Funds
enable the Mortgagor to qualify for the Buydown Mortgage Loan. The effective
interest rate of a Buydown Mortgage Loan if less than the interest rate set
forth in the related Mortgage Note will increase within the Buydown Period
as
provided in the related Buydown Agreement so that the effective interest
rate
will be equal to the interest rate as set forth in the related Mortgage Note.
All Buydown Funds required to make the full payment of principal and interest
under each Buydown Loan are in the Buydown Account held by the Company in
its
capacity as servicer. The Buydown Mortgage Loan satisfies the Underwriting
Guidelines;
-40-
(2) The
Mortgage and Mortgage Note reflect the permanent payment terms rather than
the
payment terms of the Buydown Agreement. The Buydown Agreement provides for
the
payment by the Mortgagor of the full amount of the Monthly Payment on any
Due
Date that the Buydown Funds are not available. The Buydown Funds were not
used
to reduce the original principal balance of the Mortgage Loan or to increase
the
Appraised Value of the Mortgage Property when calculating the Loan-to-Value
Ratios for purposes of the Agreement;
(3) The
Buydown Funds may not be refunded to the Mortgagor unless the Mortgagor makes
a
principal payment for the outstanding balance of the Mortgage Loan;
(4) As
of the
date of origination of the Mortgage Loan, the provisions of the related Buydown
Agreement complied with the Underwriting Guidelines.
(xlvi) Leasehold
Estates.
With
respect to each Mortgage Loan that is secured in whole or in part by the
interest of the mortgagor as a lessee under a ground lease of the related
Mortgaged Property (a “Ground
Lease”)
and
not by a fee interest in such Mortgaged Property and as further specified
in the
Underwriting Guidelines:
(a) The
mortgagor is the owner of a valid and subsisting interest as tenant under
the
Ground Lease;
(b) The
Ground Lease is in full force and effect, unmodified and not supplemented
by any
writing or otherwise;
(c) The
Company has not received notice of default by the mortgagor under the Ground
Lease or of circumstances which, with the passage of time or the giving of
notice or both, would constitute an event of default;
(d) The
term
of the Ground Lease exceeds the maturity date of the related Mortgage Loan
by at
least five (5) years;
(e) The
Ground Lease or a memorandum thereof has been recorded and by its terms permits
the leasehold estate to be mortgaged;
-41-
(f) The
Ground Lease does not contain any default provisions that could give rise
to
forfeiture or termination of the Ground Lease except for the non-payment
of the
Ground Lease rents;
(g) The
execution, delivery and performance of the Mortgage do not require the consent
(other than those consents which have been obtained and are in full force
and
effect) under, and will not contravene any provision of or cause a default
under, the Ground Lease; and
(h) The
Ground Lease provides that the leasehold can be transferred, mortgaged and
sublet an unlimited number of times either without restriction or on payment
of
a reasonable fee and delivery of reasonable documentation to the
lessor.
(xlvii) Cooperative
Loans.
With
respect to each Cooperative Loan:
|
(a)
|
The
Cooperative Shares are held by a Person as a tenant-stockholder
in a
Cooperative. Each original UCC financing statement, continuation
statement
or other governmental filing or recordation necessary to create
or
preserve the perfection and priority of the first lien and security
interest in the Cooperative Loan and Proprietary Lease has been
timely and
properly made. Any security agreement, chattel mortgage or equivalent
document related to the Cooperative Loan and delivered to Purchaser
or its
designee establishes in Purchaser a valid and subsisting perfected
first
lien on and security interest in the Mortgaged Property described
therein,
and Purchaser has full right to sell and assign the
same;
|
|
(b)
|
A
Cooperative Lien Search has been made by a company competent to
make the
same which company is acceptable to Xxxxxx Mae and qualified to
do
business in the jurisdiction where the Cooperative is
located;
|
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(c)
|
(i)
The term of the related Proprietary Lease is not less than the
terms of
the Cooperative Loan; (ii) there is no provision in any Proprietary
Lease
which requires the Mortgagor to offer for sale the Cooperative
Shares
owned by such Mortgagor first to the Cooperative; (iii) there is
no
prohibition in any Proprietary Lease against pledging the Cooperative
Shares or assigning the Proprietary Lease; (iv) the Cooperative
has been
created and exists in full compliance with the requirements for
residential cooperatives in the jurisdiction in which the Project
is
located and qualifies as a cooperative housing corporation under
Section
210 of the Code; (v) the Recognition Agreement is on a form published
by
Aztech Document Services, Inc. or includes similar provisions;
and (vi)
the Cooperative has good and marketable title to the Project, and
owns the
Project either in fee simple or under a leasehold that complies
with the
requirements of Xxxxxx Xxx or Xxxxxxx Mac; such title is free and
clear of
any adverse liens or encumbrances, except the lien of any blanket
mortgage;
|
-42-
|
(d)
|
The
Company has the right under the terms of the Mortgage Note, Pledge
Agreement and Recognition Agreement to pay any maintenance charges
or
assessments owed by the Mortgagor;
and
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|
(e)
|
Each
Stock Power (i) has all signatures guaranteed or (ii) if all signatures
are not guaranteed, then such Cooperative Shares will be transferred
by
the stock transfer agent of the Cooperative if the Company undertakes
to
convert the ownership of the collateral securing the related Cooperative
Loan.
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|
(xlviii)
|
Pledged
Asset Mortgage Loans.
|
With
respect to each Pledged Asset Mortgage Loan:
(a)
The
Pledge Holder has a rating of at least “AA” (or the equivalent) or better from
at least two Rating Agencies and the Pledge Holder is obligated to give the
beneficiary of each Letter of Credit at least sixty (60) days notice of any
non-renewal of any Letter of Credit;
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(b)
|
With
respect to each Pledged Asset Mortgage Loan, the Company is the
named
beneficiary and no Person has drawn any funds against such Letter
of
Credit;
|
|
(c)
|
Each
Letter of Credit is for an amount at least equal to 20% of the
lesser of
the Purchase Price or the Appraised Value of the related Mortgaged
Property;
|
|
(d)
|
As
of the Closing Date, the Company has complied with all the requirements
of
any Letter of Credit, and each Letter of Credit is a valid and
enforceable
obligation of the Pledge Holder;
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|
(e)
|
The
Company has the right to draw on each Letter of Credit if the related
Pledged Asset Mortgage Loan becomes 90 days or more delinquent
and to
apply such proceeds as a partial prepayment
thereon;
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-43-
|
(f)
|
The
Company has not received notice of any non-renewal of any Letter
of
Credit;
|
|
(g)
|
Upon
a default by the Pledge Holder, the Company will have a perfected
first
priority security interest in the assets pledged to secure the
Letter of
Credit and has the right to obtain possession thereof and the right
to
liquidate such assets and apply the proceeds thereof to prepay
the related
Pledged Asset Mortgage Loan; and
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(h)
|
The
Letter of Credit is required to be in effect (either for its original
term
or through renewal) until such time as all amounts owed under the
related
Pledged Asset Mortgage Loan by the related Mortgagor are less than
80% of
the lesser of the Purchase Price or the Appraised Value of the
related
Mortgaged Property.
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(xlix)
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Valid
Second Lien.
|
With
respect to any Second Lien Mortgage Loan, such Mortgage is a valid, subsisting
and enforceable second lien on the Mortgaged Property, including all buildings
on the Mortgaged Property and all installations and mechanical, electrical,
plumbing, heating and air conditioning systems located in or annexed to such
buildings, and all additions, alterations and replacements made at any time
with
respect to the foregoing. The lien of such Mortgage is subject only
to:
(i)
the
lien
of current real property taxes and assessments not yet due and
payable;
(ii)
superior
position mortgage lien(s) acceptable in accordance with the Underwriting
Guidelines;
(iii)
covenants,
conditions and restrictions, rights of way, easements and other matters of
the
public record as of the date of recording acceptable to mortgage lending
institutions in accordance with Accepted Servicing Practices and (i) referred
to
or otherwise considered in the appraisal and (ii) which do not adversely
affect
the Appraised Value; and
(iv) other
matters to which like properties are commonly subject which do not materially
interfere with the benefits of the security intended to be provided by the
mortgage or the use, enjoyment, value or marketability of the related Mortgaged
Property.
-44-
Any
security agreement, chattel mortgage or equivalent document related to and
delivered in connection with such Mortgage Loan establishes and creates a
valid,
subsisting, and enforceable second lien and second lien security interest
on the
property described therein and the Company has full right to sell and assign
the
same to the Purchaser. With respect to each Second Lien Mortgage Loan: (a)
the
first lien is in full force and effect, (b) there is no default, breach,
violation or event of acceleration existing under such first lien mortgage
or
the related mortgage note, (c) if the related first lien mortgage loan provides
for negative amortization, the LTV was calculated at the maximum principal
balance of such first lien that could result upon application of such negative
amortization feature, (d) either no consent for the Second Lien Mortgage
Loan is
required by the holder of the first lien or such consent has been obtained
and
is contained in the Mortgage File and (e) to the best of Company’s knowledge, no
event which, with the passage of time or with notice and the expiration of
any
grace or cure period, would constitute a default, breach, violation or event
or
acceleration under the related first lien mortgage loan.
Section
3.03 Repurchase.
It
is
understood and agreed that the representations and warranties set forth in
Sections 3.01 and 3.02 shall survive the sale of the Mortgage Loans to the
Purchaser and the delivery of the Mortgage Loan Documents to the Custodian
and
shall inure to the benefit of the Purchaser, notwithstanding any restrictive
or
qualified endorsement on any Mortgage Note or Assignment of Mortgage or the
examination or failure to examine any Mortgage File. Upon discovery by either
the Company or the Purchaser of a breach of any of the foregoing representations
and warranties which materially and adversely affects the value of the Mortgage
Loans or the interest of the Purchaser (or which materially and adversely
affects the interests of the Purchaser in the related Mortgage Loan in the
case
of a representation and warranty relating to a particular Mortgage Loan),
the
party discovering such breach shall give prompt written notice to the
other.
Within
ninety (90) days of the earlier of either discovery by or notice to the Company
of any breach of a representation or warranty which materially and adversely
affects the value of the Mortgage Loans, (i) the Company shall use its best
efforts promptly to cure such breach in all material respects and (ii) if
such breach cannot be cured, the Company shall, at the Purchaser’s option,
repurchase the affected Mortgage Loan at the Repurchase Price. Notwithstanding
anything to the contrary herein, any breach of the representations or warranties
set forth in clauses (xxxvii), (xxxix), (xl) or (xlii) of Section 3.02 shall
be
deemed to materially and adversely affect the value of the related Mortgage
Loans and, within ninety (90) days of the earlier of either discovery by
or
notice to the Company of such breach, the Company shall repurchase such Mortgage
Loan at the Repurchase Price. In the event that a breach shall involve any
representation or warranty set forth in Section 3.01, and such breach cannot
be
cured within ninety (90) days of the earlier of either discovery by or notice
to
the Company of such breach, all of the Mortgage Loans shall, at the Purchaser’s
option, be repurchased by the Company at the Repurchase Price. Any repurchase
of
a Mortgage Loan or Loans pursuant to the foregoing provisions of this Section
3.03 shall be accomplished by deposit in the Custodial Account of the amount
of
the Repurchase Price as required in Section 4.04, for distribution to the
Purchaser on the Remittance Date immediately following the Principal Prepayment
Period in which such Repurchase Price is received, after deducting therefrom
any
amount received in respect of such repurchased Mortgage Loan or Loans and
being
held in the Custodial Account for future distribution for application in
accordance with Section 5.01.
-45-
If
pursuant to the foregoing provisions the Company repurchases a Mortgage Loan
that is a MERS Mortgage Loan, the Company shall either (i) cause MERS to
execute and deliver an assignment of the Mortgage in recordable form to transfer
the Mortgage from MERS to the Company on behalf of the Purchaser, and shall
cause such Mortgage to be removed from registration on the MERS®
System
in accordance with MERS’ rules and regulations, or (ii) cause MERS to
designate on the MERS®
System
the Purchaser as the beneficial holder with respect to such Mortgage
Loan.
At
the
time of repurchase, the Purchaser and the Company shall arrange for the
reassignment of the repurchased Mortgage Loan to the Company and the delivery
to
the Company of any documents held by the Custodian relating to the repurchased
Mortgage Loan. In the event of a repurchase, the Company shall, simultaneously
with such reassignment, give written notice to the Purchaser that such
repurchase has taken place and amend the Mortgage Loan Schedule to reflect
the
withdrawal of the repurchased Mortgage Loan from this Agreement.
In
addition to such repurchase obligation, the Company shall indemnify the
Purchaser and hold it harmless against any losses, damages, penalties, fines,
forfeitures, reasonable and necessary legal fees and related costs, judgments,
and other costs and expenses resulting from any claim, demand, defense or
assertion based on or grounded upon, or resulting from, a breach of the
Company’s representations and warranties contained in this Agreement. It is
understood and agreed that the obligations of the Company set forth in this
Section 3.03 to cure or repurchase a defective Mortgage Loan and to indemnify
the Purchaser as provided in this Section 3.03, constitute the sole remedies
of
the Purchaser respecting a breach of the foregoing representations and
warranties.
Any
cause
of action against the Company relating to or arising out of the breach of
any
representations and warranties made in Sections 3.01 and 3.02 shall accrue
as to
any Mortgage Loan upon the earliest of (i) discovery of such breach by the
Company or the Purchaser or notice thereof by the Purchaser to the Company,
(ii) failures by the Company to cure such breach or repurchase such
Mortgage Loan as specified above, and (iii) demand upon the Company by the
Purchaser for compliance with this Agreement.
-46-
ARTICLE
IV
ADMINISTRATION
AND SERVICING OF MORTGAGE LOANS
Section
4.01 Company
to Act as Servicer.
The
Company, as an independent contractor, shall service and administer the Mortgage
Loans and shall have full power and authority, acting alone or through the
utilization of a Subservicer or Subcontractor, to do any and all things in
connection with such servicing and administration which the Company may deem
necessary or desirable, consistent with the terms of this Agreement and with
Accepted Servicing Practices. The Company shall service the Mortgage Loans
in
accordance with the guidelines of the applicable governing agency, including
the
Federal Housing Administration for FHA Mortgage Loans, the Veteran’s
Administration for VA Mortgage Loans, RHS for RHS Mortgage Loans, and the
Accepted Servicing Practices with respect to the Conventional Mortgage Loans
and
shall comply with all the rules and regulations as set forth by each applicable
agency provided that in the event the guidelines of FHA or VA conflict with
the
Servicing Guidelines of Xxxxxxx Mac, the Company shall service the loans
in
accordance with the guidelines of FHA or VA, as applicable.
Consistent
with the terms of this Agreement and any applicable FHA, VA or RHS guidelines
or
the Servicing Guides and subject to the REMIC Provisions if the Mortgage
Loans
have been transferred to a REMIC, the Company may waive, modify or vary any
term
of any Mortgage Loan or consent to the postponement of strict compliance
with
any such term or in any manner grant indulgence to any Mortgagor if in the
Company’s reasonable and prudent determination such waiver, modification,
postponement or indulgence is not materially adverse to the Purchaser and,
with
respect to the Non-Conventional Mortgage Loans, will not result in the
impairment of coverage under the MIC or LGC or Loan Note Guarantee, as
applicable. In the event of any such modification which permits the deferral
of
interest or principal payments on any Mortgage Loan, the Company shall, on
the
Business Day immediately preceding the Remittance Date in any month in which
any
such principal or interest payment has been deferred, deposit in the Custodial
Account from its own funds, in accordance with Section 5.03, the difference
between (a) such month’s principal and one month’s interest at the Mortgage
Loan Remittance Rate on the unpaid principal balance of such Mortgage Loan
and
(b) the amount paid by the Mortgagor. The Company shall be entitled to
reimbursement for such advances to the same extent as for all other advances
made pursuant to Section 5.03. Without limiting the generality of the foregoing,
the Company shall continue, and is hereby authorized and empowered, to execute
and deliver on behalf of itself and the Purchaser, all instruments of
satisfaction or cancellation, or of partial or full release, discharge and
all
other comparable instruments, with respect to the Mortgage Loans and with
respect to the Mortgaged Properties. If reasonably required by the Company,
the
Purchaser shall furnish the Company with any powers of attorney and other
documents necessary or appropriate to enable the Company to carry out its
servicing and administrative duties under this Agreement.
-47-
In
servicing and administering the Mortgage Loans, the Company shall employ
procedures (including collection procedures) and exercise the same care that
it
customarily employs and exercises in servicing and administering mortgage
loans
for its own account, giving due consideration to Accepted Servicing Practices
where such practices do not conflict with the requirements of this Agreement
and
the Purchaser’s reliance on the Company.
The
Company is authorized and empowered by the Purchaser, in its own name, when
the
Company believes it appropriate in its reasonable judgment to register any
Mortgage Loan on the MERS®
System,
or cause the removal from the registration of any Mortgage Loan on the
MERS®
System,
to execute and deliver, on behalf of the Purchaser, any and all instruments
of
assignment and other comparable instruments with respect to such assignment
or
re-recording of a Mortgage in the name of MERS, solely as nominee for the
Purchaser and its successors and assigns. The Company will comply in all
material respects with the rules and procedures of MERS in connection with
the
servicing of the MERS Mortgage Loans for as long as such Mortgage Loans are
registered with MERS and the Company will remain in good standing with
MERS.
The
Company shall cause to be maintained for each Cooperative Loan a copy of
the
financing statements and shall file any such financing statements and
continuation statements as necessary, in accordance with the Uniform Commercial
Code applicable in the jurisdiction in which the related Cooperative Apartment
is located, to perfect and protect the security interest and lien of the
Purchaser.
Section
4.02 Liquidation
of Mortgage Loans.
In
the
event that any payment due under any Mortgage Loan and not postponed pursuant
to
Section 4.01 is not paid when the same becomes due and payable, or in the
event
that the Mortgagor fails to perform any other covenant or obligation under
the
Mortgage Loan and such failure continues beyond any applicable grace period,
the
Company shall take such action as (1) the Company would take under similar
circumstances with respect to a similar mortgage loan held for its own account
for investment, (2) shall be consistent with Accepted Servicing Practices,
and (3) the Company shall determine prudently to be in the best interest of
the Purchaser. In the event that any payment due under any Mortgage Loan
is not
postponed pursuant to Section 4.01 and remains delinquent for a period of
ninety
(90) days or any other default continues for a period of ninety (90) days
beyond
the expiration of any grace or cure period, the Company shall commence
foreclosure proceedings, the Company shall notify the Purchaser in writing
of
the Company’s intention to do so, and the Company shall not commence foreclosure
proceedings if the Purchaser objects to such action within three (3) Business
Days of receiving such notice. In the event that the Purchaser objects to
such
foreclosure action, to the extent consistent with, with respect to the
Non-Conventional Mortgage Loans, FHA, VA or RHS guidelines or the Servicing
Guides, as applicable, or with respect to Conventional Mortgage Loans,
Section 5.03, the Company shall not be required to make Monthly Advances
with respect to such Mortgage Loan, pursuant to Section 5.03, and the Company’s
obligation to make such Monthly Advances shall terminate on the 90th day
referred to above. In such connection, the Company shall from its own funds
make
all necessary and proper Servicing Advances; provided,
however,
that
the Company shall not be required to expend its own funds in connection with
any
foreclosure or towards the restoration or preservation of any Mortgaged
Property, unless it shall determine (a) that such preservation, restoration
and/or foreclosure will increase the proceeds of liquidation of the Mortgage
Loan to the Purchaser after reimbursement to itself for such expenses and
(b) that such expenses will be recoverable by it either through Liquidation
Proceeds (respecting which it shall have priority for purposes of withdrawals
from the Custodial Account pursuant to Section 4.05) or through Insurance
Proceeds (respecting which it shall have similar priority).
-48-
Notwithstanding
anything to the contrary contained herein, in connection with a foreclosure
or
acceptance of a deed in lieu of foreclosure, in the event that the Company
has
reasonable cause to believe that a Mortgaged Property is contaminated by
hazardous or toxic substances or wastes, or if the Purchaser otherwise requests
an environmental inspection or review of such Mortgaged Property, such an
inspection or review is to be conducted by a qualified inspector. The cost
for
such inspection or review shall be borne by the Purchaser. Upon completion
of
the inspection or review, the Company shall promptly provide the Purchaser
with
a written report of the environmental inspection.
After
reviewing the environmental inspection report, the Purchaser shall determine
how
the Company shall proceed with respect to the Mortgaged Property. In the
event
that (a) the environmental inspection report indicates that the Mortgaged
Property is contaminated by hazardous or toxic substances or wastes and
(b) the Purchaser directs the Company to proceed with foreclosure or
acceptance of a deed in lieu of foreclosure, the Company shall be reimbursed
for
all reasonable costs associated with such foreclosure or acceptance of a
deed in
lieu of foreclosure and any related environmental clean up costs, as applicable,
from the related Liquidation Proceeds, or if the Liquidation Proceeds are
insufficient to fully reimburse the Company, the Company shall be entitled
to be
reimbursed from amounts in the Custodial Account pursuant to Section 4.05
hereof. In the event that the Purchaser directs the Company not to proceed
with
foreclosure or acceptance of a deed in lieu of foreclosure, the Company shall
be
reimbursed for all Servicing Advances made with respect to the related Mortgaged
Property from the Custodial Account pursuant to Section 4.05
hereof.
Section
4.03 Collection
of Mortgage Loan Payments.
Continuously
from the date hereof until the principal and interest on all Mortgage Loans
are
paid in full, the Company shall proceed diligently to collect all payments
due
under each of the Mortgage Loans when the same shall become due and payable
in
accordance with Accepted Servicing Practices and shall take special care
in
ascertaining and estimating Escrow Payments and all other charges that will
become due and payable with respect to the Mortgage Loan and the Mortgaged
Property, to the end that the installments payable by the Mortgagors will
be
sufficient to pay such charges as and when they become due and
payable.
-49-
Section
4.04 Establishment
of and Deposits to Custodial Account.
The
Company shall segregate and hold all funds collected and received pursuant
to a
Mortgage Loan or a Letter of Credit separate and apart from any of its own
funds
and general assets and shall establish and maintain one or more Custodial
Accounts, in the form of time deposit or demand accounts, entitled “Xxxxx Fargo
Bank, N.A., in trust for the Purchaser of Residential Mortgage Loans serviced
under the Amended and Restated Master Seller’s Warranties and Servicing
Agreement, dated as of March 1, 2006 - P & I,” or as otherwise directed in
writing by the Purchaser or its assigns after the related Closing Date in
connection with any Whole Loan Transfer or Securitization Transaction. The
Custodial Account shall be established with a Qualified Depository. Upon
request
of the Purchaser and within ten (10) days thereof, the Company shall provide
the
Purchaser with written confirmation of the existence of such Custodial Account.
The Custodial Account shall at all times be insured to the fullest extent
allowed by Applicable Law. Funds deposited in the Custodial Account may be
drawn
on by the Company in accordance with Section 4.05.
The
Company shall deposit in the Custodial Account within one (1) Business Day
(or
two (2) Business Days in the case of the amounts described in clauses (3)
through (5) below) of the Company’s receipt, and retain therein, the following
collections received by the Company and payments made by the Company after
each
Cut-off Date, other than payments of principal and interest due on or before
such Cut-off Date:
|
(1)
|
all
payments on account of principal on the Mortgage Loans, including
all
Principal Prepayments;
|
|
(2)
|
all
payments on account of interest on the Mortgage Loans, adjusted
to the
Mortgage Loan Remittance Rate;
|
|
(3)
|
all
Liquidation Proceeds;
|
|
(4)
|
all
Insurance Proceeds, including amounts required to be deposited
pursuant to
Section 4.10 (other than proceeds to be held in the Escrow Account
and
applied to the restoration or repair of the Mortgaged Property
or released
to the Mortgagor in accordance with Section 4.14), Section 4.11
and
Section 4.15;
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|
(5)
|
all
Condemnation Proceeds which are not applied to the restoration
or repair
of the Mortgaged Property or released to the Mortgagor in accordance
with
Section 4.14;
|
|
(6)
|
any
amount required to be deposited in the Custodial Account pursuant
to
Section 4.01, 5.01, 5.03, 6.01 or
6.02;
|
|
(7)
|
any
amounts payable in connection with the repurchase of any Mortgage
Loan
pursuant to Section 2.03, 3.03 or
6.02;
|
-50-
|
(8)
|
with
respect to each Principal Prepayment an amount (to be paid by the
Company
out of its funds) which, when added to all amounts allocable to
interest
received in connection with the Principal Prepayment, equals one
month’s
interest on the amount of principal so prepaid at the Mortgage
Loan
Remittance Rate;
|
|
(9)
|
any
amounts required to be deposited by the Company pursuant to Section
4.11
in connection with the deductible clause in any blanket hazard
insurance
policy;
|
|
(10)
|
any
amounts received with respect to or related to any REO Property
and all
REO Disposition Proceeds pursuant to Section
4.16;
|
|
(11)
|
an
amount from the Buydown Account that when added to the Mortgagor’s payment
will equal the full monthly amount due under the related Mortgage
Note;
|
|
(12)
|
an
amount from the Subsidy Account that when added to the Mortgagor’s payment
will equal the full monthly amount due under the related Mortgage
Note;
|
|
(13)
|
with
respect to a Pledged Asset Mortgage Loan, any amounts required
to be
deposited by the Company pursuant to Section 4.25 of this Agreement
in connection with a Letter of Credit;
and
|
|
(14)
|
all
amounts representing proceeds of any PMI
Policy.
|
The
foregoing requirements for deposit into the Custodial Account shall be
exclusive, it being understood and agreed that, without limiting the generality
of the foregoing, payments in the nature of late payment charges and assumption
fees, to the extent permitted by Section 6.01, need not be deposited by the
Company into the Custodial Account. Any interest paid on funds deposited
in the
Custodial Account by the depository institution shall accrue to the benefit
of
the Company and the Company shall be entitled to retain and withdraw such
interest from the Custodial Account pursuant to Section 4.05. The Company
shall
reimburse the Custodial Account for any losses incurred as a result of the
Company’s investment of any amounts on deposit in the Custodial
Account.
Section
4.05 Permitted
Withdrawals From Custodial Account.
The
Company shall, from time to time, withdraw funds from the Custodial Account
for
the following purposes:
|
(1)
|
to
make payments to the Purchaser in the amounts and in the manner
provided
for in Section 5.01;
|
|
(2)
|
to
reimburse itself for Monthly Advances of the Company’s funds made pursuant
to Section 5.03, the Company’s right to reimburse itself pursuant to this
subclause (2) being limited to 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 Company’s right thereto shall be prior to the
rights of the Purchaser, except that, where the Company is required
to
repurchase a Mortgage Loan pursuant to Section 2.03, 3.03 or 6.02,
the
Company’s right to such reimbursement shall be subsequent to the payment
to the Purchaser of the Repurchase Price pursuant to such sections
and all
other amounts required to be paid to the Purchaser with respect
to such
Mortgage Loan;
|
-51-
|
(3)
|
to
reimburse itself for unreimbursed Servicing Advances, and for any
unpaid
Servicing Fees, the Company’s right to reimburse itself pursuant to this
subclause (3) with respect to any Mortgage Loan being limited to
related Liquidation Proceeds, Condemnation Proceeds, Insurance
Proceeds
and such other amounts as may be collected by the Company from
the
Mortgagor or otherwise relating to the Mortgage Loan, it being
understood
that, in the case of any such reimbursement, the Company’s right thereto
shall be prior to the rights of the Purchaser, except that where
the
Company is required to repurchase a Mortgage Loan pursuant to Section
2.03, 3.03 or 6.02, in which case the Company’s right to such
reimbursement shall be subsequent to the payment to the Purchaser
of the
Repurchase Price pursuant to such sections and all other amounts
required
to be paid to the Purchaser with respect to such Mortgage
Loan;
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|
(4)
|
to
pay itself as servicing compensation any interest on funds deposited
in
the Custodial Account;
|
|
(5)
|
to
reimburse itself for expenses incurred to the extent reimbursable
pursuant
to Section 8.01;
|
|
(6)
|
to
pay any amount required to be paid pursuant to Section 4.16 related
to any
REO Property, it being understood that, in the case of any such
expenditure or withdrawal related to a particular REO Property,
the amount
of such expenditure or withdrawal from the Custodial Account shall
be
limited to amounts on deposit in the Custodial Account with respect
to the
related REO Property;
|
|
(7)
|
to
reimburse itself for any Servicing Advances or REO expenses after
liquidation of the Mortgaged Property not otherwise reimbursed
above;
|
|
(8)
|
to
reimburse the trustee with respect to any Securitization Transaction
for
any unreimbursed Monthly Advances or Servicing Advances made by
the
trustee, as applicable, the right to reimbursement pursuant to
this
subclause (8) with respect to any Mortgage Loan being limited to
related
Liquidation Proceeds, proceeds of REO Dispositions, Condemnation
Proceeds,
Insurance Proceeds and such other amounts as may be collected by
the
Company from the Mortgagor or otherwise relating to the Mortgage
Loan, it
being understood that, in the case of such reimbursement, such
trustee’s
right thereto shall be prior to the rights of the Company to reimbursement
under subclause (2) and (3) above, and prior to the rights of the
Purchaser under subclause (1)
above;
|
-52-
|
(9)
|
to
remove funds inadvertently placed in the Custodial Account by the
Company;
|
|
(10)
|
to
clear and terminate the Custodial Account upon the termination
of this
Agreement;
|
|
(11)
|
to
reimburse the Purchaser from its own funds without reimbursement
for any
losses on amounts in deposit in the Custodial Account which were
invested
in Permitted Investments; and
|
|
(12)
|
to
apply the proceeds of PMI Policy as if such proceeds were payments
on, or
Liquidation Proceeds of, the related Mortgage Loan, as the case
may
be.
|
In
the
event that the Custodial Account is interest bearing, on each Remittance
Date,
the Company shall withdraw all interest earned on funds on deposit in the
Custodial Account. The Company may use such withdrawn funds only for the
purposes described in this Section 4.05.
Section
4.06 Establishment
of and Deposits to Escrow Account.
The
Company shall segregate and hold all funds collected and received pursuant
to a
Mortgage Loan constituting Escrow Payments separate and apart from any of
its
own funds and general assets and shall establish and maintain one or more
Escrow
Accounts, in the form of time deposit or demand accounts, titled, “Xxxxx Fargo
Bank, N.A., in trust for the Purchaser under the Amended and Restated Master
Seller’s Warranties and Servicing Agreement dated as of March 1, 2006 and/or
subsequent purchasers of Mortgage Loans, and various Mortgagors - T & I.”
The Escrow Accounts shall be established with a Qualified Depository, in
a
manner which shall provide maximum available insurance thereunder. Upon request
of the Purchaser and within ten (10) days thereof, the Company shall provide
the
Purchaser with written confirmation of the existence of such Escrow Account.
Funds deposited in the Escrow Account may be drawn on by the Company in
accordance with Section 4.07.
The
Company shall deposit in the Escrow Account or Accounts within two (2) Business
Days of the Company’s receipt, and retain therein:
|
(1)
|
all
Escrow Payments collected on account of the Mortgage Loans, for
the
purpose of effecting timely payment of any such items as required
under
the terms of this Agreement;
|
-53-
|
(2)
|
all
amounts representing Insurance Proceeds or Condemnation Proceeds
which are
to be applied to the restoration or repair of any Mortgaged Property;
|
|
(3)
|
all
payments on account of Buydown Funds;
and
|
|
(4)
|
all
Servicing Advances for Mortgagors whose Escrow Payments are
insufficient.
|
The
Company shall make withdrawals from the Escrow Account only to effect such
payments as are required under this Agreement, as set forth in Section 4.07.
The
Company shall be entitled to retain any interest paid on funds deposited
in the
Escrow Account by the depository institution, other than interest on escrowed
funds required by law to be paid to the Mortgagor. To the extent required
by
law, the Company shall pay interest on escrowed funds to the Mortgagor
notwithstanding that the Escrow Account may be non-interest bearing or that
interest paid thereon is insufficient for such purposes. The Company shall
reimburse the Escrow Account for any losses incurred as a result of the
Company’s investment of any amount on deposit in the Escrow
Account.
Section
4.07 Permitted
Withdrawals From Escrow Account.
Withdrawals
from the Escrow Account or Accounts may be made by the Company
only:
|
(1)
|
to
effect timely payments of ground rents, taxes, assessments, water
rates,
mortgage insurance premiums, condominium charges, fire and hazard
insurance premiums or other items constituting Escrow Payments
for the
related Mortgage;
|
|
(2)
|
to
reimburse the Company for any Servicing Advances made by the Company
pursuant to Section 4.08 with respect to a related Mortgage Loan,
but only
from amounts received on the related Mortgage Loan which represent
late
collections of Escrow Payments
thereunder;
|
|
(3)
|
to
refund to any Mortgagor any funds found to be in excess of the
amounts
required under the terms of the related Mortgage
Loan;
|
|
(4)
|
for
transfer to the Custodial Account and application to reduce the
principal
balance of the related Mortgage Loan in accordance with the terms
of the
related Mortgage and Mortgage Note;
|
|
(5)
|
for
application to restoration or repair of the Mortgaged Property
in
accordance with the procedures outlined in Section
4.14;
|
|
(6)
|
to
pay to the Company, or any Mortgagor to the extent required by
law, any
interest paid on the funds deposited in the Escrow
Account;
|
-54-
|
(7)
|
to
remove funds inadvertently placed in the Escrow Account by the
Company;
|
|
(8)
|
to
clear and terminate the Escrow Account on the termination of this
Agreement; and
|
|
(9)
|
to
remit to Purchaser payments on account of Buydown Funds as
applicable.
|
Section
4.08 Payment
of Taxes, Insurance and Other Charges.
With
respect to each Mortgage Loan, the Company shall maintain accurate records
reflecting the status of ground rents, taxes, assessments, water rates, sewer
rents, and other charges which are or may become a lien upon the Mortgaged
Property and fire and hazard insurance coverage and shall obtain, from time
to
time, all bills for the payment of such charges (including renewal premiums)
and
shall effect payment thereof prior to the applicable penalty or termination
date, employing for such purpose deposits of the Mortgagor in the Escrow
Account
which shall have been estimated and accumulated by the Company in amounts
sufficient for such purposes, as allowed under the terms of the Mortgage.
The
Company assumes full responsibility for the timely payment of all such bills
and
shall effect timely payment of all such charges irrespective of each Mortgagor’s
faithful performance in the payment of same or the making of the Escrow
Payments, and the Company shall make advances from its own funds to effect
such
payments.
Section
4.09 Protection
of Accounts.
The
Company may transfer the Custodial Account, Buydown Account, Subsidy Account
or
the Escrow Account to a different Qualified Depository from time to time,
upon
prior written notice to the Purchaser.
Section
4.10 Maintenance
of Hazard Insurance.
The
Company shall cause to be maintained for each Mortgage Loan hazard insurance
such that all buildings upon the Mortgaged Property are insured by an insurer
acceptable to Xxxxxx Xxx or Xxxxxxx Mac, or with respect to the Non-Conventional
Mortgage Loans, GNMA or VA, as applicable, against loss by fire, hazards
of
extended coverage and such other hazards as are customary in the area where
the
Mortgaged Property is located, in an amount which is at least equal to the
lesser of (a) 100% of the insurable value, on a replacement cost basis, of
the improvements on the related Mortgaged Property or (b) the greater of
(i) the outstanding principal balance of the Mortgage Loan and (ii) an
amount such that the proceeds of such insurance shall be sufficient to prevent
the application to the Mortgagor or the loss payee of any coinsurance clause
under the policy. In the event a hazard insurance policy shall be in danger
of
being terminated, or in the event the insurer shall cease to be acceptable
to
Xxxxxx Mae or Xxxxxxx Mac, or with respect to the Non-Conventional Mortgage
Loans, GNMA or VA, as applicable, the Company shall notify the Purchaser
and the
related Mortgagor, and shall use its best efforts, as permitted by Applicable
Law, to obtain from another Qualified Insurer a replacement hazard insurance
policy substantially and materially similar in all respects to the original
policy. In no event, however, shall a Mortgage Loan be without a hazard
insurance policy at any time, subject only to Section 4.11
hereof.
-55-
If
upon
origination of the Mortgage Loan, the related Mortgaged Property was located
in
an area identified by the Flood Emergency Management Agency as having special
flood hazards (and such flood insurance has been made available) a flood
insurance policy meeting the requirements of the current guidelines of the
Federal Insurance Administration is in effect with a generally acceptable
insurance carrier acceptable to Xxxxxx Mae, Xxxxxxx Mac or, with respect
to the
Non-Conventional Mortgage Loans, GNMA, in an amount representing coverage
equal
to the lesser of (i) the minimum amount required, under the terms of
coverage, to compensate for any damage or loss on a replacement cost basis
(or
the unpaid balance of the related Mortgage if replacement cost coverage is
not
available for the type of building insured) and (ii) the maximum amount of
insurance which is available under the Flood Disaster Protection Act of 1973,
as
amended. If at any time during the term of the Mortgage Loan, the Company
determines in accordance with applicable law that a Mortgaged Property is
located in a special flood hazard area and is not covered by flood insurance
or
is covered in an amount less than the amount required by the Flood Disaster
Protection Act of 1973, as amended, the Company shall notify the related
Mortgagor that the Mortgagor must obtain such flood insurance coverage, and
if
said Mortgagor fails to obtain the required flood insurance coverage within
forty-five (45) days after such notification, the Company shall immediately
force place the required flood insurance on the Mortgagor’s behalf.
If
a
Mortgage is secured by a unit in a condominium project, the Company shall
verify
that the coverage required of the owner’s association, including hazard, flood,
liability, and fidelity coverage, is being maintained in accordance with
then
current Xxxxxx Mae, Xxxxxxx Mac or, with respect to the Non-Conventional
Mortgage Loans, GNMA requirements, secure from the owner’s association its
agreement to notify the Company promptly of any change in the insurance coverage
or of any condemnation or casualty loss that may have a material effect on
the
value of the Mortgaged Property as security.
In
the
event that any Purchaser or the Company shall determine that the Mortgaged
Property should be insured against loss or damage by hazards and risks not
covered by the insurance required to be maintained by the Mortgagor pursuant
to
the terms of the Mortgage, the Company shall communicate and consult with
the
Mortgagor with respect to the need for such insurance and bring to the
Mortgagor’s attention the required amount of coverage for the Mortgaged Property
and if the Mortgagor does not obtain such coverage, the Company shall
immediately force place the required coverage on the Mortgaged
Property.
All
policies required hereunder shall name the Company as loss payee and shall
be
endorsed with standard or union mortgagee clauses, without contribution,
which
shall provide for at least thirty (30) days prior written notice of any
cancellation, reduction in amount or material change in
coverage.
-56-
The
Company shall not interfere with the Mortgagor’s freedom of choice in selecting
either his insurance carrier or agent; provided,
however,
that
the Company shall not accept any such insurance policies from insurance
companies unless such companies are acceptable to Xxxxxx Mae, Xxxxxxx Mac
or,
with respect to the Non-Conventional Mortgage Loans, GNMA and are licensed
to do
business in the jurisdiction in which the Mortgaged Property is located.
The
Company shall determine that such policies provide sufficient risk coverage
and
amounts, that they insure the property owner, and that they properly describe
the property address.
Pursuant
to Section 4.04, any amounts collected by the Company under any such policies
(other than amounts to be deposited in the Escrow Account and applied to
the
restoration or repair of the related Mortgaged Property, or property acquired
in
liquidation of the Mortgage Loan, or to be released to the Mortgagor, in
accordance with the Company’s normal servicing procedures as specified in
Section 4.14) shall be deposited in the Custodial Account subject to withdrawal
pursuant to Section 4.05.
Section
4.11 Maintenance
of Mortgage Impairment Insurance.
In
the
event that the Company shall obtain and maintain a blanket policy insuring
against losses arising from fire and hazards covered under extended coverage
on
all of the Mortgage Loans, then to the extent such policy provides coverage
in
an amount equal to the amount required pursuant to Section 4.10 and otherwise
complies with all other requirements of Section 4.10, it shall conclusively
be
deemed to have satisfied its obligations as set forth in Section 4.10. The
Company shall prepare and make any claims on the blanket policy as deemed
necessary by the Company in accordance with Accepted Servicing Practices.
Any
amounts collected by the Company under any such policy relating to a Mortgage
Loan shall be deposited in the Custodial Account subject to withdrawal pursuant
to Section 4.05. Such policy may contain a deductible clause, in which case,
in
the event that there shall not have been maintained on the related Mortgaged
Property a policy complying with Section 4.10, and there shall have been
a loss
which would have been covered by such policy, the Company shall deposit in
the
Custodial Account at the time of such loss the amount not otherwise payable
under the blanket policy because of such deductible clause, such amount to
be
deposited from the Company’s funds, without reimbursement therefor. Upon request
of any Purchaser, the Company shall cause to be delivered to such Purchaser
a
certified true copy of such policy and a statement from the insurer thereunder
that such policy shall in no event be terminated or materially modified without
thirty (30) days’ prior written notice to such Purchaser.
Section
4.12 Maintenance
of Fidelity Bond and Errors and Omissions Insurance.
The
Company shall maintain with responsible companies, at its own expense, a
blanket
Fidelity Bond and an Errors and Omissions Insurance Policy, with broad coverage
on all officers, employees or other persons acting in any capacity requiring
such persons to handle funds, money, documents or papers relating to the
Mortgage Loans (“Company Employees”). Any such Fidelity Bond and Errors and
Omissions Insurance Policy shall be in the form of the Mortgage Banker’s Blanket
Bond and shall protect and insure the Company against losses, including forgery,
theft, embezzlement, fraud, errors and omissions and negligent acts of such
Company Employees. Such Fidelity Bond and Errors and Omissions Insurance
Policy
shall also protect and insure the Company against losses in connection with
the
release or satisfaction of a Mortgage Loan without having obtained payment
in
full of the indebtedness secured thereby. No provision of this Section 4.12
requiring such Fidelity Bond and Errors and Omissions Insurance Policy shall
diminish or relieve the Company from its duties and obligations as set forth
in
this Agreement. The minimum coverage under any such bond and insurance policy
shall be at least equal to the amounts acceptable to Xxxxxx Mae, Xxxxxxx
Mac,
or, with respect to the Non-Conventional Mortgage Loans, GNMA or VA, as
applicable. Upon the request of any Purchaser, the Company shall cause to
be
delivered to such Purchaser a certified true copy of such fidelity bond and
insurance policy and a statement from the surety and the insurer that such
fidelity bond and insurance policy shall in no event be terminated or materially
modified without thirty (30) days’ prior written notice to the
Purchaser.
-57-
Section
4.13 Inspections.
If
any
Mortgage Loan is more than sixty (60) days delinquent, the Company or its
agent
immediately shall inspect the Mortgaged Property and shall conduct subsequent
inspections in accordance with Accepted Servicing Practices or as may be
required by the primary mortgage guaranty insurer. The Company shall keep
a
written report of each such inspection.
Section
4.14 Restoration
of Mortgaged Property.
The
Company need not obtain the approval of the Purchaser prior to releasing
any
Insurance Proceeds or Condemnation Proceeds to the Mortgagor to be applied
to
the restoration or repair of the Mortgaged Property, if such release is in
accordance with Accepted Servicing Practices. For claims greater than the
lesser
of $15,000 or, with respect to the Non-Conventional Mortgage Loans, any amount
prescribed by applicable FHA, VA or RHS guidelines, at a minimum the Company
shall comply with the following conditions in connection with any such release
of Insurance Proceeds or Condemnation Proceeds:
|
(i)
|
The
Company shall receive satisfactory independent verification of
completion
of repairs and issuance of any required approvals with respect
thereto;
|
|
(ii)
|
the
Company shall take all steps necessary to preserve the priority
of the
lien of the Mortgage, including, but not limited to requiring waivers
with
respect to mechanics’ and materialmen’s
liens;
|
|
(iii)
|
the
Company shall verify that the Mortgage Loan is not in default;
and
|
|
(iv)
|
pending
repairs or restoration, the Company shall place the Insurance Proceeds
or
Condemnation Proceeds in the Escrow
Account.
|
-58-
If
the
Purchaser is named as an additional loss payee, the Company is hereby empowered
to endorse any loss draft issued in respect of such a claim in the name of
the
Purchaser.
Section
4.15 Claims.
In
connection with its activities as servicer, the Company agrees to prepare
and
present, on behalf of itself and the Purchaser, claims to the insurer under
any
MIC or LGC or Loan Note Guarantee in a timely fashion and, in this regard,
to
take such action as shall be necessary to permit recovery respecting a defaulted
Mortgage Loan. Pursuant to Section 4.04, any amounts collected by the Company
under any guaranty shall be deposited in the Custodial Account, subject to
withdrawal pursuant to Section 4.05.
Section
4.16 Title,
Management and Disposition of REO Property.
In
the
event that title to any Mortgaged Property is acquired in foreclosure or
by deed
in lieu of foreclosure, the deed or certificate of sale shall be taken in
the
name of the Company, or in the event the Company is not authorized or permitted
to hold title to real property in the state where the REO Property is located,
or would be adversely affected under the “doing business” or tax laws of such
state by so holding title, or the perfection of the ownership or security
interest of the Purchaser in such REO Property would be adversely effected,
the
deed or certificate of sale shall be taken in the name of such Person or
Persons
as shall be consistent with an Opinion of Counsel obtained by the Company
from
any attorney duly licensed to practice law in the state where the REO Property
is located. The Person or Persons holding such title other than the Purchaser
shall acknowledge in writing that such title is being held as nominee for
the
Purchaser.
The
Company shall manage, conserve, protect and operate each REO Property for
the
Purchaser solely for the purpose of its prompt disposition and sale. The
Company, either itself or through an agent selected by the Company, shall
manage, conserve, protect and operate the REO Property in the same manner
that
it manages, conserves, protects and operates other foreclosed property for
its
own account, and in the same manner that similar property in the same locality
as the REO Property is managed. The Company shall attempt to sell the same
(and
may temporarily rent the same for a period not greater than one year, except
as
otherwise provided below) on such terms and conditions as the Company deems
to
be in the best interest of the Purchaser.
The
Company shall use its best efforts to dispose of the REO Property as soon
as
possible and shall sell such REO Property in any event prior to the close
of the
third calendar year beginning after the year in which 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 Company 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. If a period longer than one year
is
permitted under the foregoing sentence and is necessary to sell any REO
Property, (i) the Company shall report monthly to the Purchaser as to the
progress being made in selling such REO Property and (ii) if, with the
written consent of the Purchaser, a purchase money mortgage is taken in
connection with such sale, such purchase money mortgage shall name the Company
as mortgagee, and such purchase money mortgage shall not be held pursuant
to
this Agreement, but instead a separate participation agreement among the
Company
and the Purchaser shall be entered into with respect to such purchase money
mortgage.
-59-
The
Company shall also maintain on each REO Property fire and hazard insurance
with
extended coverage in amount which is at least equal to the maximum insurable
value of the improvements which are a part of such property and, to the extent
required and available under the Flood Disaster Protection Act of 1973, as
amended, flood insurance in the amount required above.
The
disposition of REO Property shall be carried out by the Company at such price,
and upon such terms and conditions, as the Company deems to be in the best
interests of the Purchaser. The proceeds of sale of the REO Property shall
be
promptly deposited in the Custodial Account. As soon as practical thereafter,
the expenses of such sale shall be paid and the Company shall reimburse itself
for any related unreimbursed Servicing Advances, unpaid Servicing Fees and
unreimbursed advances made pursuant to Section 5.03. On the Remittance Date
immediately following the Principal Prepayment Period in which such sale
proceeds are received, the net cash proceeds of such sale remaining in the
Custodial Account shall be distributed to the Purchaser.
The
Company shall withdraw the Custodial Account funds necessary for the proper
operation management and maintenance of the REO Property, including the cost
of
maintaining any hazard insurance pursuant to Section 4.10 and the fees of
any
managing agent of the Company, or the Company itself. The Company shall make
monthly distributions on each Remittance Date to the Purchaser of the net
cash
flow from the REO Property (which shall equal the revenues from such REO
Property net of the expenses described in the Section 4.16 and of any reserves
reasonably required from time to time to be maintained to satisfy anticipated
liabilities for such expenses).
Section
4.17 Real
Estate Owned Reports.
Together
with the statement furnished pursuant to Section 5.02, the Company shall
furnish
to the Purchaser on or before the Remittance Date each month a statement
with
respect to any REO Property covering the operation of such REO Property for
the
previous month and the Company’s efforts in connection with the sale of such REO
Property and any rental of such REO Property incidental to the sale thereof
for
the previous month. That statement shall be accompanied by such other
information as the Purchaser shall reasonably request.
Section
4.18 Liquidation
Reports.
Upon
the
foreclosure sale of any Mortgaged Property or the acquisition thereof by
the
Purchaser pursuant to a deed in lieu of foreclosure, the Company shall submit
to
the Purchaser a liquidation report with respect to such Mortgaged
Property.
-60-
Section
4.19 Reports
of Foreclosures and Abandonments of Mortgaged Property.
Following
the foreclosure sale or abandonment of any Mortgaged Property, the Company
shall
report such foreclosure or abandonment as required pursuant to Section 6050J
of
the Code. The Company shall file information reports with respect to the
receipt
of mortgage interest received in a trade or business and information returns
relating to cancellation of indebtedness income with respect to any Mortgaged
Property as required by the Code. Such reports shall be in form and substance
sufficient to meet the reporting requirements imposed by the Code.
Section
4.20 Fair
Credit Reporting Act.
The
Company, in its capacity as servicer for each Mortgage Loan, agrees to fully
furnish, in accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (e.g.,
favorable and unfavorable) on its borrower credit files to Equifax, Experian
and
Trans Union Credit Information Company (three of the credit repositories),
on a
monthly basis.
Section
4.21 Maintenance
of Primary Mortgage Insurance Policy; Claims.
With
respect to each Conventional Mortgage Loan with a LTV in excess of 80% at
the
time of origination and that the Mortgage Loan Schedule indicates as having
a
PMI Policy, the Company shall, without any cost to the Purchaser, maintain
or
cause the Mortgagor to maintain in full force and effect a PMI Policy or
LPMI
Policy insuring that portion of the Mortgage Loan as is required by the
Underwriting Guidelines. The Company shall pay or shall cause the Mortgagor
to
pay the premium thereon on a timely basis, at least until the LTV of such
Mortgage Loan is reduced to 80%, or such amount as required by Applicable
Law,
or such other amount as Xxxxxx Xxx and Xxxxxxx Mac permits for cancellation
of
mortgage insurance. In the event that such PMI Policy shall be terminated
other
than as required by law, the Company shall obtain from another insurer a
comparable replacement policy, with a total coverage equal to the remaining
coverage of such terminated PMI Policy. If the insurer shall cease to be
a
qualified insurer, the Company shall determine whether recoveries under the
PMI
Policy or LPMI Policy are jeopardized for reasons related to the financial
condition of such insurer, it being understood that the Company shall in
no
event have any responsibility or liability for any failure to recover under
the
PMI Policy or LPMI Policy for such reason. If the Company determines that
recoveries are so jeopardized, it shall notify the Purchaser and the Mortgagor,
if required, and obtain from another qualified insurer a replacement insurance
policy. The Company will maintain or cause to be maintained in full force
and
effect any Lender Paid Mortgage Insurance Policy issued by a Qualified Insurer
with respect to each Mortgage Loan for which such coverage is in existence
or is
obtained. The Company shall not take any action which would result in
noncoverage under any applicable PMI Policy or LPMI Policy of any loss which,
but for the actions of the Company would have been covered thereunder. In
connection with any assumption or substitution agreement entered into or
to be
entered into pursuant to Section 6.01, the Company shall promptly notify
the
insurer under the related PMI Policy or LPMI Policy, if any, of such assumption
or substitution of liability in accordance with the terms of such PMI Policy
or
LPMI Policy and shall take all actions which may be required by such insurer
as
a condition to the continuation of coverage under such PMI Policy or LPMI
Policy. If such PMI Policy or LPMI Policy is terminated as a result of such
assumption or substitution of liability, the Company shall obtain a replacement
PMI Policy or LPMI Policy as provided above.
-61-
In
connection with its activities as servicer, the Company agrees to prepare
and
present, on behalf of itself and the Purchaser, claims to the insurer under
any
PMI Policy or LPMI Policy in a timely fashion in accordance with the terms
of
such PMI Policy or LPMI Policy and, in this regard, to take such action as
shall
be necessary to permit recovery under any PMI Policy or LPMI Policy respecting
a
defaulted Mortgage Loan.
Section
4.22 Establishment
of and Deposits to Subsidy Account.
(a) The
Company shall segregate and hold all Subsidy Funds collected and received
pursuant to the Subsidy Loans separate and apart from any of its own funds
and
general assets and shall establish and maintain one or more Subsidy Accounts,
in
the form of time deposit or demand accounts, titled “Xxxxx Fargo Bank, N.A., in
trust for the Purchaser, its successors or assigns, and/or subsequent purchasers
of Residential Mortgage Loans, and various Mortgagors.” The Subsidy Accounts
shall be established with a Qualified Depository, in a manner which shall
provide maximum available insurance thereunder. Upon request of the Purchaser
and within ten (10) days thereof, the Company shall provide the Purchaser
with
written confirmation of the existence of such Subsidy Account. Funds deposited
in the Subsidy Account may be drawn on by the Company in accordance with
this
4.22.
(b) The
Company shall, from time to time, withdraw funds from the Subsidy Account
for
the following purposes:
(i) on
or
prior to each Remittance Date, to deposit in the Custodial Account in the
amounts and in the manner provided for in Section 4.04(12);
(ii) to
transfer funds to another Qualified Depository in accordance with Section
4.09
hereof;
(iii) to
withdraw funds deposited in error; and
(iv) to
clear
and terminate the Subsidy Account upon the termination of this
Agreement.
(c) Notwithstanding
anything to the contrary elsewhere in this Agreement, the Company may employ
the
Escrow Account as the Subsidy Account to the extent that the Company can
separately identify any Subsidy Funds deposited therein.
(d) If
the
Mortgagor on a Subsidy Mortgage Loan defaults on such Mortgage Loan during
the
Subsidy Period and the Mortgaged Property securing such Subsidy Mortgage
Loan is
sold in the liquidation thereof (either by the Company or the insurer under
any
related PMI Policy) the Company shall, on the Remittance Date following the
date
upon which Liquidation Proceeds or REO Disposition proceeds are received
with
respect to any such Subsidy Mortgage Loan, distribute to the Purchaser all
remaining Subsidy Funds for such Mortgage Loan then remaining in the Subsidy
Account. Pursuant to the terms of each Subsidy Agreement, any amounts
distributed to the Purchaser in accordance with the preceding sentence will
be
applied to reduce the outstanding principal balance of the related Subsidy
Mortgage Loan. If a Mortgagor on a Subsidy Mortgage Loan prepays such Mortgage
Loan in it entirety during the related Subsidy Period, the Company shall
be
required to withdraw from the Subsidy Account any Subsidy Funds remaining
in the
Subsidy Account with respect to such Subsidy Mortgage Loan in accordance
with
the related Subsidy Agreement. If a principal prepayment by a Mortgagor on
a
Subsidy Mortgage Loan during the related Subsidy Period, together with any
Subsidy Funds then remaining in the Subsidy Account related to such Subsidy
Mortgage Loan, would result in a principal prepayment of the entire unpaid
principal balance of the Subsidy Mortgage Loan, the Company shall distribute
to
the Purchaser on the Remittance Date occurring in the month immediately
succeeding the month in which such Principal Prepayment is received, all
Subsidy
Funds related to such Mortgage Loan so remaining in the Subsidy Account,
together with any amounts required to be deposited into the Custodial
Account.
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Section
4.23 Establishment
of and Deposits to Buydown Account.
(a) The
Company shall segregate and hold all Buydown Funds collected and received
pursuant to the Buydown Loans separate and apart from any of its own funds
and
general assets and shall establish and maintain one or more Buydown Accounts,
in
the form of time deposit or demand accounts, titled “Xxxxx Fargo Bank, N.A., in
trust for the Purchaser, its successors or assigns, and/or subsequent purchasers
of Residential Mortgage Loans, and various Mortgagors.” The Buydown Accounts
shall be established with a Qualified Depository, in a manner which shall
provide maximum available insurance thereunder. Upon request of the Purchaser
and within ten (10) days thereof, the Company shall provide the Purchaser
with
written confirmation of the existence of such Buydown Account. Funds deposited
in the Buydown Account may be drawn on by the Company in accordance with
this
4.23.
(b) The
Company shall, from time to time, withdraw funds from the Buydown Account
for
the following purposes:
(i) on
or
prior to each Remittance Date, to deposit in the Custodial Account in the
amounts and in the manner provided for in Section 4.04(11);
(ii) to
transfer funds to another Qualified Depository in accordance with Section
4.09
hereof;
(iii) to
withdraw funds deposited in error; and
(iv) to
clear
and terminate the Buydown Account upon the termination of this
Agreement.
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(c) Notwithstanding
anything to the contrary elsewhere in this Agreement, the Company may employ
the
Escrow Account as the Buydown Account to the extent that the Company can
separately identify any Buydown Funds deposited therein.
If
the
Mortgagor on a Buydown Mortgage Loan defaults on such Mortgage Loan during
the
Buydown Period and the Mortgaged Property securing such Buydown Mortgage
Loan is
sold in the liquidation thereof (either by the Company or the insurer under
any
related PMI Policy) the Company shall, on the Remittance Date following the
date
upon which Liquidation Proceeds or REO Disposition proceeds are received
with
respect to any such Buydown Mortgage Loan, distribute to the Purchaser all
remaining Buydown Funds for such Mortgage Loan then remaining in the Buydown
Account. Pursuant to the terms of each Buydown Agreement, any amounts
distributed to the Purchaser in accordance with the preceding sentence will
be
applied to reduce the outstanding principal balance of the related Buydown
Mortgage Loan. If a Mortgagor on a Buydown Mortgage Loan prepays such Mortgage
Loan in it entirety during the related Buydown Period, the Company shall
be
required to withdraw from the Buydown Account any Buydown Funds remaining
in the
Buydown Account with respect to such Buydown Mortgage Loan in accordance
with
the related Buydown Agreement. If a principal prepayment by a Mortgagor on
a
Buydown Mortgage Loan during the related Buydown Period, together with any
Buydown Funds then remaining in the Buydown Account related to such Buydown
Mortgage Loan, would result in a principal prepayment of the entire unpaid
principal balance of the Buydown Mortgage Loan, the Company shall distribute
to
the Purchaser on the Remittance Date occurring in the month immediately
succeeding the month in which such Principal Prepayment is received, all
Buydown
Funds related to such Mortgage Loan so remaining in the Buydown Account,
together with any amounts required to be deposited into the Custodial
Account.
Section
4.24 Letter
of Credit Compliance.
Notwithstanding
any other provision of this Agreement, the Company shall comply with all
the
requirements of any Letter of Credit so as to assure the full benefit of
such
Letter of Credit to the Purchaser.
Section
4.25 Letter
of Credit Draws.
The
Company shall take all steps necessary to make draws under any Letter of
Credit
in accordance with the provisions thereof and shall draw on each Letter of
Credit all amounts payable thereunder within the time frame required by the
Letter of Credit or such shorter time within which the Company can effect
such
draw (not to exceed thirty (30) calendar days) of (i) the date the related
Pledged Asset Mortgage Loan becomes 90 days or more delinquent and (ii) the
receipt of notice of non-renewal from the Pledge Holder at any time prior
to the
date that all amounts owed under the related Pledged Asset Mortgage Loan
are
less than or equal to 80% of the Appraised Value of the related Mortgaged
Property. The Company shall notify the Purchaser promptly in writing upon
receipt of notice from the Pledge Holder of non-renewal of any Letter of
Credit.
Upon receipt of any amounts as a result of a draw on a Letter of Credit because
of the non-renewal of such Letter of Credit or as a result of the Pledged
Asset
Mortgage Loan continuing in default for 90 or more days, the Company shall
deposit such amounts in the Custodial Account and such amount shall be treated
as a payment of principal.
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Section
4.26 Assignment
of the Letter of Credit.
Notwithstanding
anything to the contrary in this Agreement (including, without limitation,
the
termination or transfer of the servicing rights and/or obligations of the
Company pursuant to Articles X and XI hereof), the Company, as
beneficiary under any Non-Assigned Letters of Credit, shall transfer and
assign,
at no cost to the Purchaser, each Non-Assigned Letter of Credit to the Purchaser
in accordance with the provisions thereof within ten (10) days of such
termination or transfer. In addition, the Company shall forward within
one (1) Business Day of receipt any notice received of non-renewal of any
Letter of Credit. Any funds received by the Company from draws on the
Non-Assigned Letters of Credit after the Company is no longer the servicer
hereunder shall be remitted by the Company to the successor servicer for
deposit
into the Custodial Account.
Section
4.27 Pledge
Holder Defaults.
Upon
a
default under the Letter of Credit by the Pledge Holder, the Company shall
take
possession of the assets securing the Letter of Credit and shall deposit
such
assets or the proceeds thereof in the Custodial Account and apply them as
a
prepayment of the related Pledged Asset Mortgage Loan. If such default described
in the prior sentence occurs at any time that the Company is no longer the
servicer of the related Pledged Asset Mortgage Loan, the Company shall, upon
knowledge of such default or notice from the successor servicer of such default
with respect to any Non-Assigned Letter of Credit forward such proceeds to
the
successor servicer for deposit into the Custodial Account.
Section
4.28 Use
of
Subservicers and Subcontractors.
The
Company shall not hire or otherwise utilize the services of any Subservicer
to
fulfill any of the obligations of the Company under this Agreement or any
Reconstitution Agreement unless the Company complies with the provisions
of
paragraph (a) of this Section 4.28. The Company shall not hire or otherwise
utilize the services of any Subcontractor, and shall not permit any Subservicer
to hire or otherwise utilize the services of any Subcontractor, to fulfill
any
of the obligations of the Company under this Agreement or any Reconstitution
Agreement unless the Company complies with the provisions of paragraph (b)
of
this Section 4.28.
(a) It
shall
not be necessary for the Company to seek the consent of the Purchaser or
any
Depositor to the utilization of any Subservicer. The Company shall cause
any
Subservicer used by the Company (or by any Subservicer) for the benefit of
the
Purchaser and any Depositor to comply with the provisions of this Section
4.28
and with Sections 6.04, 6.06, 9.01(f)(iii), 9.01(f)(v) and 9.01(g) of this
Agreement to the same extent as if such Subservicer were the Company, and
to
provide the information required with respect to such Subservicer under Section
9.01(f)(iv) of this Agreement. The Company shall be responsible for obtaining
from each Subservicer and delivering to the Purchaser and any Depositor any
servicer compliance statement required to be delivered by such Subservicer
under
Section 6.04 and any assessment of compliance and attestation required to
be
delivered by such Subservicer under Section 6.06 and any certification required
to be delivered to the Person that will be responsible for signing the Sarbanes
Certification under Section 6.06 as and when required to be
delivered.
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(b) It
shall
not be necessary for the Company to seek the consent of the Purchaser or
any
Depositor to the utilization of any Subcontractor. The Company shall promptly
upon request provide to the Purchaser and any Depositor (or any designee
of the
Depositor, such as a master servicer or administrator) a written description
(in
form and substance satisfactory to the Purchaser and such Depositor) of the
role
and function of each Subcontractor utilized by the Company or any Subservicer,
specifying (i) the identity of each such Subcontractor, (ii) which (if any)
of
such Subcontractors are “participating in the servicing function” within the
meaning of Item 1122 of Regulation AB, and (iii) which elements of the Servicing
Criteria will be addressed in assessments of compliance provided by each
Subcontractor identified pursuant to clause (ii) of this paragraph.
As
a
condition to the utilization of any Subcontractor determined to be
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, the Company shall cause any such Subcontractor used by the
Company (or by any Subservicer) for the benefit of the Purchaser and any
Depositor to comply with the provisions of Sections 6.06 and 9.01(g) of this
Agreement to the same extent as if such Subcontractor were the Company. The
Company shall be responsible for obtaining from each Subcontractor and
delivering to the Purchaser and any Depositor any assessment of compliance
and
attestation required to be delivered by such Subcontractor under Section
6.06,
in each case as and when required to be delivered.
Section
4.29 Subordination
of Second Lien Mortgage Loans.
The
Company is authorized, without the prior approval of the Purchaser, to consent
to the refinancing of any Superior Lien on a Mortgaged Property, provided,
that
the resulting Combined Loan-to-Value Ratio of such Mortgage Loan is no higher
than the Combined Loan-to-Value Ratio prior to such refinancing.
Where
permitted by law and where the senior lienholder is required to notify a
junior
lienholder be named as a party defendant in foreclosure proceedings in order
to
foreclose such junior lienholder’s equity of redemption, the Company shall, at
the reasonable expense of the Purchaser, file (or cause to be filed) a request
for notice of any action by a superior lienholder under a related senior
lien
for the protection of the Purchaser’s interest in the related Second Lien
Mortgage Loan.
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If
the
Company is notified that any superior lienholder has accelerated or intends
to
accelerate the obligations secured by the superior lien, or has declared
or
intends to declare a default under the superior mortgage or the promissory
note
secured thereby, or has filed or intends to file an election to have the
Mortgaged Property sold or foreclosed, the Company shall take whatever actions
are necessary to protect the interests of the Purchaser, and/or to preserve
the
security of the related Mortgage Loan, subject to any requirements applicable
to
real estate mortgage investment conduits pursuant to the Code. The Company
shall
advance the funds necessary to cure the default or reinstate the superior
lien
if the Servicer determines that such advance is in the best interests of
the
Purchaser. The Company shall not make such an advance except to the extent
that
it determines in its reasonable good faith judgment that such advance will
be
recoverable from Liquidation Proceeds on the related Mortgage Loan. The Company
shall thereafter take such action as is necessary to recover the amount so
advanced.
ARTICLE
V
PAYMENTS
TO PURCHASER
Section
5.01 Remittances.
On
each
Remittance Date, the Company shall remit by wire transfer of immediately
available funds to the Purchaser (a) all amounts deposited in the Custodial
Account as of the close of business on the Determination Date (net of charges
against or withdrawals from the Custodial Account pursuant to Section 4.05),
plus
(b) all amounts, if any, which the Company is obligated to distribute
pursuant to Section 5.03, minus
(c) any amounts attributable to Principal Prepayments received after the
applicable Principal Prepayment Period which amounts shall be remitted on
the
following Remittance Date, together with any additional interest required
to be
deposited in the Custodial Account in connection with such Principal Prepayment
in accordance with Section 4.04(8); minus
(d) any amounts attributable to Monthly Payments collected but due on a Due
Date or Dates subsequent to the first day of the month of the Remittance
Date
and minus
(e) any
amounts attributable to Buydown Funds relating to a future Due Period being
held
in the Custodial Account, which amounts shall be remitted on the Remittance
Date
next succeeding the Due Period for such amounts..
With
respect to any remittance received by the Purchaser after the date on which
such
payment was due, the Company shall pay to the Purchaser interest on any such
late payment at an annual rate equal to the Prime Rate, adjusted as of the
date
of each charge, plus
two
percentage points, but in no event greater than the maximum amount permitted
by
Applicable Law. Such interest shall be deposited in the Custodial Account
by the
Company on the date such late payment is made and shall cover the period
commencing with the day following such second Business Day and ending with
the
Business Day on which such payment is made, both inclusive. Such interest
shall
be remitted along with the distribution payable on the next succeeding
Remittance Date. The payment by the Company of any such interest shall not
be
deemed an extension of time for payment or a waiver of any Event of Default
by
the Company.
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Section
5.02 Statements
to Purchaser.
Not
later
than the Remittance Advice Date, the Company shall furnish to the Purchaser
a
Monthly Remittance Advice, including the information set forth in Exhibit
E
attached hereto, with a trial balance report attached thereto, as to the
period
ending on the last day of the preceding month, in a form to be agreed upon
by
the Purchaser and the Company.
Section
5.03 Monthly
Advances by Company.
On
the
Business Day immediately preceding each Remittance Date, the Company shall
deposit in the Custodial Account from its own funds or from amounts held
for
future distribution an amount equal to all Monthly Payments (with interest
adjusted to the Mortgage Loan Remittance Rate) which were due on the Mortgage
Loans during the applicable Due Period and which were delinquent at the close
of
business on the Determination Date immediately preceding such Remittance
Date or
which were deferred pursuant to Section 4.01. Any amounts held for future
distribution and so used shall be replaced by the Company by deposit in the
Custodial Account on or before any future Remittance Date if funds in the
Custodial Account on such Remittance Date shall be less than payments to
the
Purchaser required to be made on such Remittance Date. Notwithstanding the
foregoing, the Company 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 Company, its parent, or their respective
successors hereunder shall have a long-term credit rating of at least “A” by
Fitch, Inc. (doing business as Fitch Ratings), “A” by Standard & Poor’s
Ratings Services, a division of The XxXxxx-Xxxx Companies, Inc. and “A2” by
Xxxxx’x Investors Service, Inc. The Company’s obligation to make such Monthly
Advances as to any Mortgage Loan will continue through the last Monthly Payment
due prior to the payment in full of the Mortgage Loan, or through the earlier
of: (i) the last Remittance Date prior to the Remittance Date for the
distribution of all Liquidation Proceeds and other payments or recoveries
(including Insurance Proceeds and Condemnation Proceeds) with respect to
the
Mortgage Loan and (ii) the Remittance Date prior to the date the Mortgage
Loan is converted to REO Property; provided,
however,
that if
requested by a Rating Agency in connection with Securitization Transaction,
the
Company shall be obligated to make such advances through the Remittance Date
prior to the date on which cash is received in connection with the liquidation
of REO Property; provided,
however,
that
such obligation shall cease if the Company determines, in its sole reasonable
opinion, that advances with respect to such Mortgage Loan are non-recoverable
by
the Company from Liquidation Proceeds, Insurance Proceeds, Condemnation Proceeds
or otherwise with respect to a particular Mortgage Loan. In the event that
the
Company determines that any such advances are non-recoverable, the Company
shall
provide the Purchaser with a certificate signed by two officers of the Company
evidencing such determination. The Company shall not have an obligation to
advance amounts in respect to shortfalls relating to the Servicemembers Civil
Relief Act or similar state or local laws.
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ARTICLE
VI
GENERAL
SERVICING PROCEDURES
Section
6.01 Transfers
of Mortgaged Property.
The
Company shall use its best efforts to enforce any “due-on-sale” provision
contained in any Mortgage or Mortgage Note and to deny assumption by the
Person
to whom the Mortgaged Property has been or is about to be sold whether by
absolute conveyance or by contract of sale, and whether or not the Mortgagor
remains liable on the Mortgage and the Mortgage Note. When the Mortgaged
Property has been conveyed by the Mortgagor, the Company shall, to the extent
it
has knowledge of such conveyance, exercise its rights to accelerate the maturity
of such Mortgage Loan under the “due-on-sale” clause applicable thereto;
provided,
however,
that
the Company shall not exercise such rights if prohibited by law from doing
so
or, with respect to the Non-Conventional Mortgage Loans, if the exercise
of such
rights would impair or threaten to impair any recovery under the related
MIC or
LGC or Loan Note Guarantee.
If
the
Company reasonably believes it is unable under Applicable Law to enforce
such
“due-on-sale” clause, the Company shall enter into (i) an assumption and
modification agreement with the Person to whom such property has been conveyed,
pursuant to which such Person becomes liable under the Mortgage Note and
the
original Mortgagor remains liable thereon or (ii) in the event that the
Company is unable under Applicable Law to require that the original Mortgagor
remain liable under the Mortgage Note and the Company has the prior consent
of
the primary mortgage guaranty insurer, a substitution of liability agreement
with the purchaser of the Mortgaged Property pursuant to which the original
Mortgagor is released from liability and the purchaser of the Mortgaged Property
is substituted as Mortgagor and becomes liable under the Mortgage Note. If
an
assumption fee is collected by the Company for entering into an assumption
agreement, the fee will be retained by the Company as additional servicing
compensation. In connection with any such assumption, neither the Mortgage
Interest Rate borne by the related Mortgage Note, the term of the Mortgage
Loan,
the outstanding principal amount of the Mortgage Loan nor any other material
terms shall be changed without the Purchaser’s consent.
To
the
extent that any Mortgage Loan is assumable, the Company shall inquire diligently
into the credit worthiness of the proposed transferee, and shall use the
underwriting criteria for approving the credit of the proposed transferee
which
are used with respect to underwriting mortgage loans of the same type as
the
Mortgage Loans. If the credit of the proposed transferee does not meet such
underwriting criteria, the Company diligently shall, to the extent permitted
by
the Mortgage or the Mortgage Note and by Applicable Law, accelerate the maturity
of the Mortgage Loan.
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Section
6.02 Satisfaction
of Mortgages and Release of Mortgage Files.
Upon
the
payment in full of any Mortgage Loan, the Company shall notify the Purchaser
in
the Monthly Remittance Advice as provided in Section 5.02 and may request
the
release of any Mortgage Loan Documents. If such Mortgage Loan is a MERS Mortgage
Loan, the Company is authorized to cause the removal from the registration
on
the MERS System of such Mortgage and to execute and deliver, on behalf of
the
Purchaser, any and all instruments of satisfaction or cancellation or of
partial
or full release.
If
the
Company satisfies or releases a Mortgage without first having obtained payment
in full of the indebtedness secured by the Mortgage or should the Company
otherwise prejudice any rights the Purchaser may have under the mortgage
instruments, upon written demand of the Purchaser, the Company shall repurchase
the related Mortgage Loan at the Repurchase Price by deposit thereof in the
Custodial Account within two (2) Business Days of receipt of such demand
by the
Purchaser. The Company shall maintain the Fidelity Bond and Errors and Omissions
Insurance Policy as provided for in Section 4.12 insuring the Company against
any loss it may sustain with respect to any Mortgage Loan not satisfied in
accordance with the procedures set forth herein.
Section
6.03 Servicing
Compensation.
As
compensation for its services hereunder, the Company shall be entitled to
withdraw from the Custodial Account or to retain from interest payments on
the
Mortgage Loans the amount of its Servicing Fee. The Servicing Fee shall be
payable monthly and shall be computed on the basis of the same unpaid principal
balance and for the period respecting which any related interest payment
on a
Mortgage Loan is received. The obligation of the Purchaser to pay the Servicing
Fee is limited to, and payable solely from, the interest portion of such
Monthly
Payments. The Servicing Fee shall not be reduced by the amount of any guaranty
fee payable to FHA, VA or RHS.
Additional
servicing compensation in the form of assumption fees, to the extent provided
in
Section 6.01, and late payment charges shall be retained by the Company to
the
extent not required to be deposited in the Custodial Account. The Company shall
be required to pay all expenses incurred by it in connection with its servicing
activities hereunder and shall not be entitled to reimbursement thereof except
as specifically provided for herein.
Section
6.04 Annual
Statement as to Compliance.
On
or
before March 1st
of each
calendar year, commencing in 2007, the Company shall deliver to the Purchaser
and any Depositor a statement of compliance addressed to the Purchaser and
such
Depositor and signed by an authorized officer of the Company, to the effect
that
(a) a review of the Company’s activities during the immediately preceding
calendar year (or applicable portion thereof) and of its performance under
this
Agreement and any applicable Reconstitution Agreement during such period
has
been made under such officer’s supervision, and (b) to the best of such
officers’ knowledge, based on such review, the Company has fulfilled all of its
obligations under this Agreement and any applicable Reconstitution Agreement
in
all material respects throughout such calendar year (or applicable portion
thereof) or, if there has been a failure to fulfill any such obligation in
any
material respect, specifically identifying each such failure known to such
officer and the nature and the status thereof.
-70-
Section
6.05 Annual
Independent Public Accountants’ Servicing Report.
Except
with respect to any Mortgage Loans that are the subject of a Securitization
Transactions, the Company shall, on or before March 1st
of each
calendar year commencing in 2007, at its expense, cause a firm of independent
public accountants which is a member of the American Institute of Certified
Public Accountants to furnish a statement to each Purchaser to the effect
that
such firm has examined certain documents and records relating to the servicing
of the mortgage loans similar in nature and that such firm is of the opinion
that the provisions of this or similar agreements have been complied with,
and
that, on the basis of such examination conducted substantially in compliance
with the Uniform Single Attestation Program for Mortgage Bankers, nothing
has
come to their attention which would indicate that such servicing has not
been
conducted in compliance therewith, except for (i) such exceptions as such
firm shall believe to be immaterial and (ii) such other exceptions as shall
be set forth in such statement. By providing the Purchaser a copy of a Uniform
Single Attestation Program Report from their independent public accountant’s on
an annual basis, the Company shall be considered to have fulfilled its
obligations under this Section 6.05.
Section
6.06 Report
on Assessment of Compliance and Attestation.
With
respect to any Mortgage Loans that are the subject of a Securitization
Transaction, the Company shall, on or before March 1st
of each
calendar year, commencing in 2007:
|
(i)
|
deliver
to the Purchaser and any Depositor a report (in form and substance
reasonably satisfactory to the Purchaser and such Depositor) regarding
the
Company’s assessment of compliance with the Servicing Criteria during the
immediately preceding calendar year, as required under Rules 13a-18
and
15d-18 of the Exchange Act and Item 1122 of Regulation AB. Such
report
shall be addressed to the Purchaser and such Depositor and signed
by an
authorized officer of the Company and shall address each of the
Servicing
Criteria specified substantially in the form of Exhibit M
hereto;
|
|
(ii)
|
deliver
to the Purchaser and any Depositor a report of a registered public
accounting firm reasonably acceptable to the Purchaser and such
Depositor
that attests to, and reports on, the assessment of compliance made
by the
Company and delivered pursuant to the preceding paragraph. Such
attestation shall be in accordance with Rules 1-02(a)(3) and 2-02(g)
of
Regulation S-X under the Securities Act and the Exchange Act;
|
-71-
|
(iii)
|
cause
each Subservicer and each Subcontractor, determined by the Company
pursuant to Section 4.28(b) to be “participating in the servicing
function” within the meaning of Item 1122 of Regulation AB, to deliver to
the Purchaser and such Depositor an assessment of compliance and
accountants’ attestation as and when provided in paragraphs (i) and (ii)
of this Section 6.06; and
|
|
(iv)
|
if
requested by the Purchaser or any Depositor not later than February
1 of
the calendar year in which such certification is to be delivered,
deliver
to the Purchaser, any Depositor and any other Person that will
be
responsible for signing the certification (a “Sarbanes Certification”)
required by Rules 13a-14(d) and 15d-14(d) under the Exchange Act
(pursuant
to Section 302 of the Xxxxxxxx-Xxxxx Act of 2002) on behalf of
an
asset-backed issuer with respect to a Securitization Transaction
a
certification in the form attached hereto as Exhibit
N.
|
The
Company acknowledges that the parties identified in clause (iv) above may
rely
on the certification provided by the Company pursuant to such clause in signing
a Sarbanes Certification and filing such with the Commission. Neither the
Purchaser nor any Depositor will request delivery of a certification under
clause (iv) above unless a Depositor is required under the Exchange Act to
file
an annual report on Form 10-K with respect to an issuing entity whose asset
pool
includes Mortgage Loans.
Each
assessment of compliance provided by a Subservicer pursuant to Section 6.06(i)
shall address each of the Servicing Criteria specified substantially in the
form
of Exhibit M hereto delivered to the Purchaser concurrently with the execution
of this Agreement or, in the case of a Subservicer subsequently appointed
as
such, on or prior to the date of such appointment. An assessment of compliance
provided by a Subcontractor pursuant to Section 6.06(iii) need not address
any
elements of the Servicing Criteria other than those specified by the Company
pursuant to Section 4.28.
Section
6.07 Remedies.
(i) Any
failure by the Company, any Subservicer, any Subcontractor or any Third-Party
Originator to deliver any information, report, certification, accountants’
letter or other material when and as required under Article IX, Section 4.28,
Section 6.04, Section 6.05 or Section 6.06, or any breach by the Company
of a
representation or warranty set forth in Section 9.01(f)(vi)(A), or in a writing
furnished pursuant to Section 9.01(f)(vi)(B) and made as of a date prior
to the
closing date of the related Securitization Transaction, to the extent that
such
breach is not cured by such closing date, or any breach by the Company of
a
representation or warranty in a writing furnished pursuant to Section
9.01(f)(vi)(B) to the extent made as of a date subsequent to such closing
date,
shall, except as provided in sub-clause (ii) of this Section, immediately
and
automatically, without notice or grace period, constitute an Event of Default
with respect to the Company under this Agreement and any applicable
Reconstitution Agreement, and shall entitle the Purchaser or Depositor, as
applicable, in its sole discretion to terminate the rights and obligations
of
the Company as servicer under this Agreement and/or any applicable
Reconstitution Agreement without payment (notwithstanding anything in this
Agreement or any applicable Reconstitution Agreement to the contrary) of
any
compensation to the Company; provided that to the extent than any provision
of
this Agreement and/or any applicable Reconstitution Agreement expressly provides
for the survival of certain rights or obligations following termination of
the
Company as servicer, such provision shall be given effect.
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(ii) Any
failure by the Company, any Subservicer or any Subcontractor to deliver any
information, report, certification or accountants’ letter when and as required
under Section 6.04, Section 6.05 or Section 6.06, including (except as provided
below) any failure by the Company to identify any Subcontractor “participating
in the servicing function” within the meaning of Item 1122 of Regulation AB,
which continues unremedied for ten (10) calendar days after the date on which
such information, report, certification or accountants’ letter was required to
be delivered shall constitute an Event of Default with respect to the Company
under this Agreement and any applicable Reconstitution Agreement, and shall
entitle the Purchaser or Depositor, as applicable, in its sole discretion
to
terminate the rights and obligations of the Company under this Agreement
and/or
any applicable Reconstitution Agreement without payment (notwithstanding
anything in this Agreement to the contrary) of any compensation to the Company;
provided that to the extent that any provision of this Agreement and/or any
applicable Reconstitution Agreement expressly provides for the survival of
certain rights or obligations following termination of the Company as servicer,
such provision shall be given effect.
Neither
the Purchaser nor any Depositor shall be entitled to terminate the rights
and
obligations of the Company pursuant to this subparagraph (ii) if a failure
of
the Company to identify a Subcontractor “participating in the servicing
function” within the meaning of Item 1122 of Regulation AB was attributable
solely to the role or functions of such Subcontractor with respect to mortgage
loans other than the Mortgage Loans.
(iii) The
Company shall promptly reimburse the Purchaser (or any designee of the
Purchaser, such as a master servicer) and any Depositor, as applicable, for
all
reasonable expenses incurred by the Purchaser (or such designee) or such
Depositor, as such are incurred, in connection with the termination of the
Company as servicer and the transfer of servicing of the Mortgage Loans to
a
successor servicer. The provisions of this paragraph shall not limit whatever
rights the Purchaser or any Depositor may have under other provisions of
this
Agreement and/or any applicable Reconstitution Agreement or otherwise, whether
in equity or at law, such as an action for damages, specific performance
or
injunctive relief.
Section
6.08 Right
to Examine Company Records.
The
Purchaser, or its designee, shall have the right to examine and audit any
and
all of the books, records, or other information of the Company, whether held
by
the Company or by another on its behalf, with respect to or concerning this
Agreement or the Mortgage Loans, during business hours or at such other times
as
may be reasonable under applicable circumstances, upon reasonable advance
notice. The Purchaser shall pay its own expenses associated with such
examination.
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Section
6.09 Compliance
with REMIC Provisions.
If
a
REMIC election has been made with respect to the arrangement under which
the
Mortgage Loans and REO Property are held, the Company shall not take any
action,
cause the REMIC to take any action or fail to take (or fail to cause to be
taken) any action that, under the REMIC Provisions, if taken or not taken,
as
the case may be, could (i) endanger the status of the REMIC as a REMIC or
(ii) result in the imposition of a tax upon the REMIC (including but not
limited to the tax on “prohibited transactions” as defined Section 860G(a)(2) of
the Code and the tax on “contributions” to a REMIC set forth in Section 860(D)
of the Code) unless the Company has received an Opinion of Counsel (at the
expense of the party seeking to take such action) to the effect that the
contemplated action will not endanger such REMIC status or result in the
imposition of any such tax.
Section
6.10 Compliance
with Xxxxx-Xxxxx-Xxxxxx Act of 1999.
With
respect to each Mortgage Loan and the related Mortgagor, the Company shall
comply with Title V of the Xxxxx-Xxxxx-Xxxxxx Act of 1999 and all applicable
regulations and guidelines promulgated thereunder.
ARTICLE
VII
COMPANY
TO COOPERATE
Section
7.01 Provision
of Information.
During
the term of this Agreement, the Company shall furnish to the Purchaser such
periodic, special or other reports or information, and copies or originals
of
any documents contained in the Servicing File for each Mortgage Loan provided
for herein. All other special reports or information not provided for herein
as
shall be necessary, reasonable, or appropriate with respect to the Purchaser
or
any regulatory agency will be provided at the Purchaser’s expense. All such
reports, documents or information shall be provided by and in accordance
with
all reasonable instructions and directions which the Purchaser may
give.
The
Company shall execute and deliver all such instruments and take all such
action
as the Purchaser may reasonably request from time to time, in order to
effectuate the purposes and to carry out the terms of this
Agreement.
Section
7.02 Financial
Statements; Servicing Facility.
In
connection with marketing the Mortgage Loans, the Purchaser may make available
to a prospective purchaser a Consolidated Statement of Operations of the
Company
for the most recently completed two fiscal years for which such a statement
is
available, as well as a Consolidated Statement of Condition at the end of
the
last two fiscal years covered by such Consolidated Statement of Operations.
The
Company shall also make available any comparable interim statements to the
extent any such statements have been prepared by or on behalf of the Company
(and are available upon request to members or stockholders of the Company
or to
the public at large).
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The
Company shall also make available, within a reasonable period of time, to
the
Purchaser or prospective purchaser a knowledgeable financial or accounting
officer for the purpose of answering questions respecting recent developments
affecting the Company or the financial statements of the Company, and to
permit
any prospective purchaser to inspect the Company’s servicing facilities for the
purpose of satisfying such prospective purchaser that the Company has the
ability to service the Mortgage Loans as provided in this
Agreement.
ARTICLE
VIII
THE
COMPANY
Section
8.01 Indemnification;
Third Party Claims.
The
Company shall indemnify the Purchaser and hold it harmless against any and
all
claims, losses, damages, penalties, fines, forfeitures, reasonable and necessary
legal fees and related costs, judgments, and any other costs, fees and expenses
that the Purchaser may sustain in any way related to the failure of the Company
to perform its duties and service the Mortgage Loans in strict compliance
with
the terms of this Agreement. The Company immediately shall notify the Purchaser
if a claim is made by a third party with respect to this Agreement or the
Mortgage Loans, assume (with the prior written consent of the Purchaser)
the
defense of any such claim and pay all expenses in connection therewith,
including counsel fees, and promptly pay, discharge and satisfy any judgment
or
decree which may be entered against it or the Purchaser in respect of such
claim. The Company shall follow any written instructions received from the
Purchaser in connection with such claim. The Purchaser shall promptly reimburse
the Company for all costs, fees or expenses advanced by it pursuant to this
paragraph except when the claim in any way results from, relates to or arises
out of any liability, obligation, act or omission of the Company, including
without limitation, the Company’s indemnification obligation under Section 3.03
and this Section 8.01, any repurchase obligation of the Company hereunder
including Sections 2.03, 3.03 and 6.02, or the failure of the Company to
service
and administer the Mortgage Loans and otherwise perform its obligations
hereunder in strict compliance with the terms of this Agreement.
Section
8.02 Merger
or Consolidation of the Company.
The
Company shall keep in full effect its existence, rights and franchises, and
shall obtain and preserve its qualification to do business in each jurisdiction
in which such qualification is or shall be necessary to protect the validity
and
enforceability of this Agreement or any of the Mortgage Loans and to perform
its
duties under this Agreement.
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Any
Person into which the Company may be merged or consolidated, or any corporation
resulting from any merger, conversion or consolidation (including by means
of
the sale of all or substantially all of the Company’s assets to such Person) to
which the Company shall be a party, or any Person succeeding to the business
of
the Company (whether or not related to loan servicing), shall be the successor
of the Company hereunder, without the execution or filing of any paper or
any
further act on the part of any of the parties hereto, anything herein to
the
contrary notwithstanding; provided,
however,
that
the Company shall not, without the prior written approval of the Purchaser
be a
party to any such merger, conversion or consolidation, or sell or otherwise
dispose of all or substantially all of its business or assets if, (i) as
a
result of such merger, conversion or consolidation, sale or other disposition,
an Event of Default under Section 10.01 hereof would exist with respect to
such
successor company or (ii) such successor has (a) a residential primary servicer
rating for servicing of mortgage loans issued by Standard & Poor’s Rating
Services, a division of The XxXxxx-Xxxx Companies, Inc., Fitch, Inc. or Xxxxx’x
Investors Service, Inc. below “average” or its equivalent or (b) a net worth of
less than $25,000,000.
Section
8.03 Limitation
on Liability of Company and Others.
Neither
the Company nor any of the directors, officers, employees or agents of the
Company shall be under any liability to the Purchaser for any action taken
or
for refraining from the taking of any action in good faith pursuant to this
Agreement, or for errors in judgment; provided,
however,
that
this provision shall not protect the Company or any such Person against any
breach of warranties or representations made herein, or failure to perform
its
obligations in strict compliance with any standard of care set forth in this
Agreement or any other liability which would otherwise be imposed under this
Agreement. The Company and any director, officer, employee or agent of the
Company may rely in good faith on any document of any kind prima facie properly
executed and submitted by any Person respecting any matters arising hereunder.
The Company shall not be under any obligation to appear in, prosecute or
defend
any legal action which is not incidental to its duties to service the Mortgage
Loans in accordance with this Agreement and which in its opinion may involve
it
in any expense or liability; provided,
however,
that
the Company may, with the consent of the Purchaser, undertake any such action
which it may deem necessary or desirable in respect to this Agreement and
the
rights and duties of the parties hereto. In such event, the Company shall
be
entitled to reimbursement from the Purchaser of the reasonable legal expenses
and costs of such action.
Section
8.04 Limitation
on Resignation and Assignment by Company.
The
Purchaser has entered into this Agreement with the Company and subsequent
Purchasers will purchase the Mortgage Loans in reliance upon the independent
status of the Company, and the representations as to the adequacy of its
servicing facilities, plant, personnel, records and procedures, its integrity,
reputation and financial standing, and the continuance thereof. Therefore,
the
Company shall neither assign this Agreement or the servicing rights hereunder
nor sell or otherwise dispose of all of its property or assets without the
prior
written consent of the Purchaser which consent shall not be unreasonably
withheld.
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The
Company shall not resign from the obligations and duties hereby imposed on
it
except by mutual consent of the Company and the Purchaser or upon the
determination that its duties hereunder are no longer permissible under
Applicable Law and such incapacity cannot be cured by the Company. Any such
determination permitting the resignation of the Company shall be evidenced
by an
Opinion of Counsel to such effect delivered to the Purchaser which Opinion
of
Counsel shall be in form and substance acceptable to the Purchaser. No such
resignation shall become effective until a successor shall have assumed the
Company’s responsibilities and obligations hereunder in the manner provided in
Section 12.01.
Without
in any way limiting the generality of this Section 8.04, in the event that
the
Company either shall assign this Agreement or the servicing responsibilities
hereunder; or sell or otherwise dispose of all or substantially all of its
property or assets without the prior written consent of the Purchaser, then
the
Purchaser shall have the right to terminate this Agreement upon notice given
as
set forth in Section 10.01, without any payment of any penalty or damages
and
without any liability whatsoever to the Purchaser or any third
party.
ARTICLE
IX
SECURITIZATION
TRANSACTION
Section
9.01 Removal
of Mortgage Loans from Inclusion under this Agreement upon a Securitization
Transaction.
The
Purchaser and the Company agree that with respect to some or all of the Mortgage
Loans, the Purchaser, at its sole option, may effect Whole Loan Transfers,
Agency Transfers or Securitization Transactions, retaining the Company as
the
Servicer thereof or subservicer if a master servicer is employed, or as
applicable the “seller/servicer.” From and after the Reconstitution Date, the
Mortgage Loans transferred shall remain covered by this Agreement, insofar
as
the Company shall continue to service such Mortgage Loans on behalf of the
Purchaser in accordance with the terms and provisions of this
Agreement.
The
Company shall cooperate with the Purchaser in connection with each Whole
Loan
Transfer, Agency Transfer or Securitization Transaction in accordance with
this
Section 9.01. In connection therewith:
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(a)
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the
Company shall make all representations and warranties with respect
to the
Mortgage Loans as of the Closing Date and with respect to the Company
itself as of the closing date of each Whole Loan Transfer, Agency
Transfer
or Securitization Transaction;
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-77-
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(b)
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the
Company shall negotiate in good faith and execute any seller/servicer
agreements required to effectuate the foregoing; provided
such agreements create no greater obligation or cost on the part
of the
Company than otherwise set forth in this
Agreement;
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(c)
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the
Company shall represent to the Purchaser, the depositor, the trustee
and
the initial purchaser of the securities issued in connection with
any
Securitization Transaction that: (1) that the Company has serviced
the Mortgage Loans in accordance with the terms of this Agreement,
and has
otherwise complied with all covenants and obligations hereunder
and
(2) that the Company has taken no action that would, nor omitted to
take any required action the omission of which would, have the
effect of
impairing the mortgage insurance or guarantee on the Mortgage
Loans;
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(d)
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the
Company shall deliver an opinion of counsel (which can be an opinion
of
in-house counsel to the Company) reasonably acceptable to the Purchaser;
provided
that any out-of-pocket, third party expenses incurred by the Company
in
connection with the foregoing shall be paid by the
Purchaser;
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(e)
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the
Company shall execute any seller/servicer agreements required within
a
reasonable period of time after receipt of such seller/servicer
agreements
which time shall be sufficient for the Company and the Company’s counsel
to review such seller/servicer agreements. Under this Agreement,
the
Company shall retain a Servicing Fee for each Mortgage Loan at
the
Servicing Fee Rate;
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(f)
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the
Company shall, in connection with any Securitization Transaction,
(1)
within five (5) Business Days following request by the Purchaser
or any
Depositor, provide to the Purchaser and such Depositor (or, as
applicable,
cause each Third-Party Originator and each Subservicer to provide),
in
writing and in form and substance reasonably satisfactory to the
Purchaser
and such Depositor, the information and materials specified in
paragraphs
(i), (ii), (iii) and (vii) of this subsection (f), and (2) as promptly
as
practicable following notice to or discovery by the Company, provide
to
the Purchaser and any Depositor (in writing and in form and substance
reasonably satisfactory to the Purchaser and such Depositor) the
information specified in paragraph (iv) of this subsection
(f).
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(i)
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If
so requested by the Purchaser or any Depositor, the Company shall
provide
such information regarding (1) the Company, as originator of the
Mortgage
Loans (including as an acquirer of Mortgage Loans from a Qualified
Correspondent), or (2) each Third-Party Originator, and (3) as
applicable,
each Subservicer, as is requested for the purpose of compliance
with Items
1103(a)(1), 1105, 1110, 1117 and 1119 of Regulation AB. Such information
shall include, at a minimum:
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(A)
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the
originator’s form of organization;
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(B)
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a
description of the originator’s origination program and how long the
originator has been engaged in originating residential mortgage
loans,
which description shall include a discussion of the originator’s
experience in originating mortgage loans of a similar type as the
Mortgage
Loans; information regarding the size and composition of the originator’s
origination portfolio; and information that may be material, in
the good
faith judgment of the Purchaser, to an analysis of the performance
of the
Mortgage Loans, including the originators’ credit-granting or underwriting
criteria for mortgage loans of similar type(s) as the Mortgage
Loans and
such other information as the Purchaser or any Depositor may reasonably
request for the purpose of compliance with Item 1110(b)(2) of Regulation
AB;
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(C)
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a
description of any material legal or governmental proceedings pending
(or
known to be contemplated) against the Company, each Third-Party
Originator
and each Subservicer; and
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(D)
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a
description of any affiliation or relationship (of a type described
in
Item 1119 if Regulation AB) between the Company, each Third-Party
Originator, each Subservicer and any of the following parties to
a
Securitization Transaction, as such parties are identified to the
Company
by the Purchaser or any Depositor in writing in advance of a
Securitization Transaction:
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(1)
the
sponsor;
(2) the
depositor;
(3) the
issuing entity;
(4) any
servicer;
(5) any
trustee;
(6) any
originator;
(7) any
significant obligor;
(8) any
enhancement or support provider; and
(9) any
other
material transaction party.
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(ii)
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If
so requested by the Purchaser or any Depositor, the Company shall
provide
(or, as applicable, cause each Third-Party Originator to provide)
Static
Pool Information with respect to the mortgage loans (of a similar
type as
the Mortgage Loans, as reasonably identified by the Purchaser as
provided
below) originated by (1) the Company, if the Company is an originator
of
Mortgage Loans (including as an acquirer of Mortgage Loans from
a
Qualified Correspondent), and/or (2) each Third-Party Originator.
Such
Static Pool Information shall be prepared by the Company (or Third-Party
Originator) on the basis of its reasonable, good faith interpretation
of
the requirements of Item 1105(a)(1)-(3) of Regulation AB. To the
extent
that there is reasonably available to the Company (or Third-Party
Originator) Static Pool Information with respect to more than one
mortgage
loan type, the Purchaser or any Depositor shall be entitled to
specify
whether some or all of such information shall be provided pursuant
to this
paragraph. The content of such Static Pool Information may be in
the form
customarily provided by the Company, and need not be customized
for the
Purchaser or any Depositor. Such Static Pool Information for each
vintage
origination year or prior securitized pool, as applicable, shall
be
presented in increments no less frequently than quarterly over
the life of
the mortgage loans included in the vintage origination year or
prior
securitized pool. The most recent periodic increment must be as
of a date
no later than 135 days prior to the date of the prospectus or other
offering document in which the Static Pool Information is to be
included
or incorporated by reference. The Static Pool Information shall
be
provided in an electronic format that provides a permanent record
of the
information provided, such as a portable document format (pdf)
file, or
other such electronic format reasonably required by the Purchaser
or the
Depositor, as applicable.
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Promptly
following notice or discovery of a material error in Static Pool Information
provided pursuant to the immediately preceding paragraph (including an omission
to include therein information required to be provided pursuant to such
paragraph), the Company shall provide corrected Static Pool Information to
the
Purchaser or any Depositor, as applicable, in the same format in which Static
Pool Information was previously provided to such party by the
Company.
If
so
requested by the Purchaser or any Depositor, the Company shall provide (or,
as
applicable, cause each Third-Party Originator to provide), at the expense
of the
requesting party (to the extent of any additional incremental expense associated
with delivery pursuant to this Agreement), such statements and agreed-upon
procedures letters of certified public accountants reasonably acceptable
to the
Purchaser or Depositor, as applicable, pertaining to Static Pool Information
relating to prior securitized pools for securitizations closed on or after
January 1, 2006 or, in the case of Static Pool Information with respect to
the
Company’s or Third-Party Originator’s originations or purchases, to calendar
months commencing January 1, 2006, as the Purchaser or such Depositor shall
reasonably request. Such statements and letters shall be addressed to and
be for
the benefit of such parties as the Purchaser or such Depositor shall designate,
which may include, by way of example, any sponsor, any Depositor and any
broker
dealer acting as underwriter, placement agent or initial purchaser with respect
to a Securitization Transaction. Any such statement or letter may take the
form
of a standard, generally applicable document accompanied by a reliance letter
authorizing reliance by the addressees designated by the Purchaser or such
Depositor.
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(iii)
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If
so requested by the Purchaser or any Depositor, the Company shall
provide
such information regarding the Company, as servicer of the Mortgage
Loans,
and each Subservicer (each of the Company and each Subservicer,
for
purposes of this paragraph, a “Servicer”), as is requested for the purpose
of compliance with Items 1108 of Regulation AB. Such information
shall
include, at a minimum:
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(A)
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the
Servicer’s form of organization;
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(B)
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a
description of how long the Servicer has been servicing residential
mortgage loans; a general discussion of the Servicer’s experience in
servicing assets of any type as well as a more detailed discussion
of the
Servicer’s experience in, and procedures for, the servicing function it
will perform under this Agreement and any Reconstitution Agreements;
information regarding the size, composition and growth of the Servicer’s
portfolio of residential mortgage loans of a type similar to the
Mortgage
Loans and information on factors related to the Servicer that may
be
material, in the good faith judgment of the Purchaser or any Depositor,
to
any analysis of the servicing of the Mortgage Loans or the related
asset-backed securities, as applicable, including, without limitation:
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(1)
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whether
any prior securitizations of mortgage loans of a type similar to
the
Mortgage Loans involving the Servicer have defaulted or experienced
an
early amortization or other performance triggering event because
of
servicing during the three-year period immediately preceding the
related
Securitization Transaction;
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(2)
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the
extent of outsourcing the Servicer
utilizes;
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(3)
|
whether
there has been previous disclosure of material noncompliance with
the
applicable servicing criteria with respect to other securitizations
of
residential mortgage loans involving the Servicer as a servicer
during the
three-year period immediately preceding the related Securitization
Transaction;
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(4)
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whether
the Servicer has been terminated as servicer in a residential mortgage
loan securitization, either due to a servicing default or to application
of a servicing performance test or trigger; and
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(5)
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such
other information as the Purchaser or any Depositor may reasonably
request
for the purpose of compliance with Item 1108(b)(2) of Regulation
AB;
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(C)
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a
description of any material changes during the three-year period
immediately preceding the related Securitization Transaction to
the
Servicer’s policies or procedures with respect to the servicing function
it will perform under this Agreement and any Reconstitution Agreements
for
mortgage loans of a type similar to the Mortgage
Loans;
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(D)
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information
regarding the Servicer’s financial condition, to the extent that there is
a material risk that an adverse financial event or circumstance
involving
the Servicer could have a material adverse effect on the performance
by
the Company of its servicing obligations under this Agreement or
any
Reconstitution Agreement;
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(E)
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information
regarding advances made by the Servicer on the Mortgage Loans and
the
Servicer’s overall servicing portfolio of residential mortgage loans for
the three-year period immediately preceding the related Securitization
Transaction, which may be limited to a statement by an authorized
officer
of the Servicer to the effect that the Servicer has made all advances
required to be made on residential mortgage loans serviced by it
during
such period, or, if such statement would not be accurate, information
regarding the percentage and type of advances not made as required,
and
the reasons for such failure to
advance;
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(F)
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a
description of the Servicer’s processes and procedures designed to address
any special or unique factors involved in servicing loans of a
similar
type as the Mortgage Loans;
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(G)
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a
description of the Servicer’s processes for handling delinquencies,
losses, bankruptcies and recoveries, such as through liquidation
of
mortgaged properties, sale of defaulted mortgage loans or workouts;
and
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(H)
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information
as to how the Servicer defines or determines delinquencies and
charge-offs, including the effect of any grace period, re-aging,
restructuring, partial payments considered current or other practices
with
respect to delinquency and loss
experience.
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(iv)
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If
so requested by the Purchaser or any Depositor for the purpose
of
satisfying its reporting obligation under the Exchange Act with
respect to
any class of asset-backed securities, the Company shall (or shall
cause
each Subservicer and Third-Party Originator to) (1) notify the
Purchaser
and any Depositor in writing of (A) any material litigation or
governmental proceedings pending against the Company, any Subservicer
or
any Third-Party Originator and (B) any affiliations or relationships
that
develop following the closing date of a Securitization Transaction
between
the Company, any Subservicer or any Third-Party Originator and
any of the
parties specified in Section 9.01(f)(i)(D) (and any other parties
identified in writing by the requesting party) with respect to
such
Securitization Transaction, and (2) provide to the Purchaser and
any
Depositor a description of such proceedings, affiliations or
relationships.
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(v)
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As
a condition to the succession to the Company or any Subservicer
as
servicer or Subservicer under this Agreement or any Reconstitution
Agreement by any Person (i) into which the Company or such Subservicer
may
be merged or consolidated, or (ii) which may be appointed as a
successor
to the Company or any Subservicer, the Company shall provide to
the
Purchaser and any Depositor, at least fifteen (15) calendar days
prior to
the effective date of such succession or appointment, (x) written
notice
to the Purchaser and any Depositor of such succession or appointment
and
(y) in writing and in form and substance reasonably satisfactory
to the
Purchaser and such Depositor, all information reasonably requested
by the
Purchaser or any Depositor in order to comply with is reporting
obligation
under Item 6.02 of Form 8-K with respect to any class of asset-backed
securities.
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(vi)
(A) The
Company shall be deemed to represent to the Purchaser, as of the date on
which
information is first provided to the Purchaser under this Section 9.01(f)
that,
except as disclosed in writing to the Purchaser prior to such date: (1) the
Company is not aware and has not received notice that any default, early
amortization or other performance triggering event has occurred as to any
other
securitization due to any act or failure to act of the Company; (2) the Company
has not been terminated as servicer in a residential mortgage loan
securitization, either due to a servicing default or to application of a
servicing performance test or trigger; (3) no material noncompliance with
the
applicable servicing criteria with respect to other securitizations of
residential mortgage loans involving the Company as servicer has been disclosed
or reported by the Company; (4) no material changes to the Company’s policies or
procedures with respect to the servicing function it will perform under this
Agreement and any Reconstitution Agreement for mortgage loans of a type similar
to the Mortgage Loans have occurred during the three-year period immediately
preceding the related Securitization Transaction; (5) there are no aspects
of
the Company’s financial condition that could have a material adverse effect on
the performance by the Company of its servicing obligations under this Agreement
or any Reconstitution Agreement; (6) there are no material legal or governmental
proceedings pending (or known to be contemplated) against the Company, any
Subservicer or any Third-Party Originator; and (7) there are no affiliations,
relationships or transactions relating to the Company, any Subservicer or
any
Third-Party Originator with respect to any Securitization Transaction and
any
party thereto identified by the related Depositor of a type described in
Item
1119 of Regulation AB.
(B) If
so
requested by the Purchaser on any date following the date on which information
is first provided to the Purchaser under this Section 9.01(f), the Company
shall, within five (5) Business Days following such request, confirm in writing
the accuracy of the representations and warranties set forth in sub clause
(A)
above or, if any such representation and warranty is not accurate as of the
date
of such request, provide reasonably adequate disclosure of the pertinent
facts,
in writing, to the requesting party.
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(vii)
|
In
addition to such information as the Company, as servicer, is obligated
to
provide pursuant to other provisions of this Agreement, if so requested
by
the Purchaser or any Depositor, the Company shall provide such
information
regarding the performance or servicing of the Mortgage Loans as
is
reasonably required to facilitate preparation of distribution reports
in
accordance with Item 1121 of Regulation AB. Such information shall
be
provided concurrently with the monthly reports otherwise required
to be
delivered by the servicer under this Agreement, commencing with
the first
such report due not less than ten (10) Business Days following
such
request.
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(g)
|
the
Company shall indemnify the Purchaser, each affiliate of the Purchaser,
and each of the following parties participating in a Securitization
Transaction; each sponsor and issuing entity; each Person responsible
for
the preparation, execution or filing of any report required to
be filed
with the Commission with respect to such Securitization Transaction,
or
for execution of a certification pursuant to Rule 13a-14(d) or
Rule
15d-14(d) under the Exchange Act with respect to such Securitization
Transaction; each broker dealer acting as underwriter, placement
agent or
initial purchaser, each Person who controls any of such parties
or the
Depositor (within the meaning of Section 15 of the Securities Act
and
Section 20 of the Exchange Act); and the respective present and
former
directors, officers, employees and agents of each of the foregoing
and of
the Depositor, and shall hold each of them harmless from and against
any
losses, damages, penalties, fines, forfeitures, legal fees and
expenses
and related costs, judgments, and any other costs, fees and expenses
that
any of them may sustain arising out of or based
upon:
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(i)
(A) any
untrue statement of a material fact contained or alleged to be contained
in any
information, report, certification, accountants’ letter or other material
provided in written or electronic form under Sections 4.28, 6.04, 6.06, 9.01(e)
and (f) by or on behalf of the Company, or provided under Sections 4.28,
6.04,
6.06, 9.01(e) and (f) by or on behalf of any Subservicer, Subcontractor or
Third-Party Originator (collectively, the “Company Information”), or (B) the
omission or alleged omission to state in the Company Information a material
fact
required to be stated in the Company Information or necessary in order to
make
the statements therein, in the light of the circumstances under which they
were
made, not misleading; provided,
by way of clarification, that
clause (B) of this paragraph shall be construed solely by reference to the
Company Information and not to any other information communicated in connection
with a sale or purchase of securities, without regard to whether the Company
Information or any portion thereof is presented together with or separately
from
such other information;
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(ii)
|
any
failure by the Company, any Subservicer, any Subcontractor or any
Third-Party Originator to deliver any information, report, certification,
accountants’ letter or other material when and as required under Sections
4.28, 6.04, 6.06, 9.01(e) and (f), including any failure by the
Company to
identify any Subcontractor “participating in the servicing function”
within the meaning of Item 1122 of Regulation AB;
or
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|
(iii)
|
any
breach by the Company of a representation or warranty set forth
in Section
9.01(f)(vi)(A) or in a writing furnished pursuant to Section
9.01(f)(vi)(B) and made as of a date prior to the closing date
of the
related Securitization Transaction, to the extent that such breach
is not
cured by such closing date, or any breach by the Company of a
representation or warranty in a writing furnished pursuant to Section
9.01(f)(vi)(B) to the extent made as of a date subsequent to such
closing
date.
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In
the
case of any failure of performance described in sub-clause (ii) of this Section
9.01(g), the Company shall promptly reimburse the Purchaser, any Depositor,
as
applicable, and each Person responsible for the preparation, execution or
filing
of any report required to be filed with the Commission with respect to such
Securitization Transaction, or for execution of a certification pursuant
to Rule
13a-14(d) or Rule 15d-14(d) under the Exchange Act with respect to such
Securitization Transaction, for all costs reasonably incurred by each such
party
in order to obtain the information, report, certification, accountants’ letter
or other material not delivered as required by the Company, any Subservicer,
any
Subcontractor or any Third-Party Originator.
This
indemnification shall survive the termination of this Agreement or the
termination of any party to this Agreement.
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(h)
|
the
Purchaser and a credit-worthy parent of the Purchaser, reasonably
acceptable to the Company, shall indemnify the Company, each affiliate
of
the Company, each Person who controls any of such parties or the
Company
(within the meaning of Section 15 of the Securities Act and Section
20 of
the Exchange Act) and the respective present and former directors,
officers, employees and agents of each of the foregoing and of
the
Company, and shall hold each of them harmless from and against
any losses,
damages, penalties, fines, forfeitures, legal fees and expenses
and
related costs, judgments, and any other costs, fees and expenses
that any
of them may sustain arising out of or based
upon:
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(i)
(A) any
untrue statement of a material fact contained or alleged to be contained
in any
offering materials related to a Securitization Transaction, including without
limitation the registration statement, prospectus, prospectus supplement,
any
private placement memorandum, any freewriting prospectuses, any ABS
informational and computational material, any offering circular, any
computational materials, and any amendments or supplements to the foregoing
(collectively, the “Securitization Materials”) or
-86-
(B)
the
omission or alleged omission to state in the Securitization Materials a material
fact required to be stated in the Securitization Materials or necessary in
order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading, but only to the extent that such untrue
statement or alleged untrue statement or omission or alleged omission is
other
than a statement or omission arising out of, resulting from, or based upon
the
Company Information.
This
indemnification shall survive the termination of this Agreement or the
termination of any party to this Agreement.
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(i)
|
the
Company and Purchaser shall enter into an indemnification agreement,
substantially in the form of Exhibit L attached hereto;
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(j)
|
with
respect to any Mortgage Loan that is subject to a Securitization
Transaction in which Xxxxxxx Mac provides a guarantee for some
or all of
the securities issued therein, the Company and the Purchaser shall
enter
into an amendment to this Agreement, substantially in the form
of
Exhibit J attached hereto;
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(k)
|
with
respect to any Mortgage Loan that is subject to a Securitization
Transaction in which Xxxxxx Mae provides a guarantee for some or
all of
the securities issued therein, the Company and the Purchaser shall
enter
into an assignment, assumption and recognition agreement, substantially
in
the form of Exhibit J attached
hereto.
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The
Purchaser and the Company acknowledge and agree that the purpose of Section
9.01(f) is to facilitate compliance by the Purchaser and any Depositor with
the
provisions of Regulation AB and related rules and regulations of the Commission.
Although
Regulation AB is applicable by its terms only to offerings of asset-backed
securities that are registered under the Securities Act, the Company
acknowledges that investors in privately offered securities may require that
the
Purchaser or any Depositor provide comparable disclosure in unregistered
offerings. References in this Agreement to compliance with Regulation AB
include
provision of comparable disclosure in private offerings.
Neither
the Purchaser nor any Depositor shall exercise its right to request delivery
of
information or other performance under these provisions other than in good
faith, or for purposes other than compliance with the Securities Act, the
Exchange Act and the rules and regulations of the Commission thereunder (or
the
provision in a private offering of disclosure comparable to that required
under
the Securities Act). The Company acknowledges that interpretations of the
requirements of Regulation AB may change over time, whether due to interpretive
guidance provided by the Commission or its staff, consensus among participants
in the asset-backed securities markets, advice of counsel, or otherwise,
and
agrees to comply with requests made by the Purchaser or any Depositor in
good
faith for delivery of information under these provisions on the basis of
evolving interpretations of Regulation AB. In connection with any Securitization
Transaction, the Company shall cooperate fully with the Purchaser to deliver
to
the Purchaser (including any of its assignees or designees) and any Depositor,
any and all statements, reports, certifications, records and any other
information necessary in the good faith determination of the Purchaser or
any
Depositor to permit the Purchaser or such Depositor to comply with the
provisions of Regulation AB, together with such disclosures relating to the
Company, any Subservicer, any Third-Party Originator and the Mortgage Loans,
or
the servicing of the Mortgage Loans, reasonably believed by the Purchaser
or any
Depositor to be necessary in order to effect such compliance.
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The
Purchaser (including any of its assignees or designees) shall cooperate with
the
Company by providing timely notice of requests for information under these
provisions and by reasonably limiting such requests to information required,
in
the Purchaser’s reasonable judgment, to comply with Regulation AB.
In
the
event the Purchaser has elected to have the Company hold record title to
the
Mortgages, prior to the Reconstitution Date and after the Closing Date the
Company shall prepare an Assignment of Mortgage in blank or, at the option
of
the Purchaser, to the trustee from the Company (to the extent such Assignment
of
Mortgage has not been prepared on or before the Closing Date) acceptable
to the
trustee for each Mortgage Loan that is part of the Whole Loan Transfers or
Securitization Transactions. The Purchaser shall pay all preparation and
recording costs associated therewith. The Company shall execute each Assignment
of Mortgage, track such Assignments of Mortgage to ensure they have been
recorded and deliver them as required by the trustee upon the Company’s receipt
thereof. Additionally, the Company shall prepare and execute, at the direction
of the Purchaser, any note endorsements in connection with any and all
seller/servicer agreements.
The
Company acknowledges that the Purchaser may from to time sell or transfer
certain of the Mortgage Loans to Xxxxxx Xxx and/or Xxxxxxx Mac or deliver
certain securities secured by the Mortgage Loans to Xxxxxx Xxx or Xxxxxxx
Mac to
be guaranteed. In the event such sale or delivery occurs, the Company agrees
that it shall deliver to Xxxxxx Mae, Xxxxxxx Mac, FHA, VA or RHS, as applicable,
all reports, certificates, and other documentation required by each such
agency
and that it shall remit to Xxxxxx Mae or Xxxxxxx Mac, as applicable, all
amounts
required to be remitted in accordance such agency’s guaranty program. The
Purchaser and the Company agree that any Mortgage Loans sold by the Purchaser
to
Xxxxxx Mae on a recourse basis, will be managed in accordance with the Process
Guidelines set forth in Exhibit H hereto. The Company acknowledges that the
requirements of the Process Guidelines are in addition to the Company’s
obligations to service the Loans in accordance with the Servicing Guides
and
Accepted Servicing Practices. All Mortgage Loans not sold or transferred
pursuant to Whole Loan Transfers, Agency Transfers or Securitization
Transactions shall remain subject to this Agreement and shall continue to
be
serviced in accordance with the terms of this Agreement and with respect
thereto
this Agreement shall remain in full force and effect.
-88-
ARTICLE
X
DEFAULT
Section
10.01 Events
of Default.
Each
of
the following shall constitute an Event of Default on the part of the
Company:
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(i)
|
any
failure by the Company to remit to the Purchaser any payment required
to
be made under the terms of this Agreement which continues unremedied
for a
period of two (2) Business Days after the date upon which written
notice
of such failure, requiring the same to be remedied, shall have
been given
to the Company by the Purchaser; or
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(ii)
|
failure
by the Company duly to observe or perform in any material respect
any
other of the covenants or agreements on the part of the Company
set forth
in this Agreement which continues unremedied for a period of thirty
(30)
days after the date on which written notice of such failure, requiring
the
same to be remedied, shall have been given to the Company by the
Purchaser
or by the Custodian; or
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(iii)
|
failure
by the Company to maintain its license to do business in any jurisdiction
where the Mortgaged Property is located if such license is required;
or
|
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(iv)
|
a
decree or order of a court or agency or supervisory authority having
jurisdiction for the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, including bankruptcy,
marshaling of assets and liabilities or similar proceedings, or
for the
winding-up or liquidation of its affairs, shall have been entered
against
the Company and such degree or order shall have remained in force
undischarged or unstayed for a period of sixty (60) days;
or
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|
(v)
|
the
Company shall consent to the appointment of a conservator or receiver
or
liquidator in any insolvency, readjustment of debt, marshaling
of assets
and liabilities or similar proceedings of or relating to the Company
or of
or relating to all or substantially all of its property;
or
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(vi)
|
the
Company shall admit in writing its inability to pay its debts generally
as
they become due, file a petition to take advantage of any applicable
insolvency, bankruptcy or reorganization statute, make an assignment
for
the benefit of its creditors, voluntarily suspend payment of its
obligations or cease its normal business operations for three (3)
Business
Days; or
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|
(vii)
|
the
Company ceases to meet the qualifications of a Xxxxxx Xxx, Xxxxxxx
Mac,
GNMA, VA or RHS servicer; or
|
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(viii)
|
the
Company attempts to assign its right to servicing compensation
hereunder
or to assign this Agreement or the servicing responsibilities hereunder
in
violation of Section 8.04; or
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(ix)
|
the
taking of any action by the Company, any Company Employee, any
Affiliate
or any director or employee thereof that constitutes fraud or criminal
activity in the performance of its obligations under this Agreement
or the
indictment of any of the foregoing Persons for criminal activity
related
to the mortgage origination or servicing activities of the Company,
in
each case, where such indictment materially and adversely affects
the
ability of the Company to perform its obligations under this Agreement
(subject to the condition that such indictment is not dismissed
within
ninety (90) days).
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In
each
and every such case, so long as an Event of Default shall not have been
remedied, in addition to whatever rights the Purchaser may have at law or
equity
to damages, including injunctive relief and specific performance, the Purchaser,
by notice in writing to the Company, may terminate with cause all the rights
and
obligations of the Company under this Agreement and in and to the Mortgage
Loans
and the proceeds thereof. If the Company obtains knowledge of an Event of
Default, the Company shall promptly notify the Purchaser.
Upon
receipt by the Company of such written notice, all authority and power of
the
Company under this Agreement, whether with respect to the Mortgage Loans
or
otherwise, shall pass to and be vested in the successor appointed pursuant
to
Section 12.01. Upon written request from any Purchaser, the Company shall
prepare, execute and deliver to the successor entity designated by the Purchaser
any and all documents and other instruments, place in such successor’s
possession all Mortgage Files, and do or cause to be done all other acts
or
things necessary or appropriate to effect the purposes of such notice of
termination, including but not limited to the transfer and endorsement or
assignment of the Mortgage Loans and related documents, at the Company’s sole
expense. The Company shall cooperate with the Purchaser and such successor
in
effecting the termination of the Company’s responsibilities and rights
hereunder, including without limitation, the transfer to such successor for
administration by it of all cash amounts which shall at the time be credited
by
the Company to the Custodial Account, Subsidy Account or Escrow Account or
thereafter received with respect to the Mortgage Loans.
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If
any of
the Mortgage Loans are MERS Mortgage Loans, in connection with the termination
or resignation (as described in Section 8.04) of the Company hereunder, either
(i) the successor servicer shall represent and warrant that it is a member
of MERS in good standing and shall agree to comply in all material respects
with
the rules and procedures of MERS in connection with the servicing of the
Mortgage Loans that are registered with MERS, or (ii) the Company shall
cooperate with the successor servicer either (x) in causing MERS to execute
and deliver an assignment of Mortgage in recordable form to transfer the
Mortgage from MERS to the Purchaser and to execute and deliver such other
notices, documents and other instruments as may be necessary to effect a
transfer of such Mortgage Loan or servicing of such Mortgage Loan on the
MERS®
System
to the successor servicer or (y) in causing MERS to designate on the
MERS®
System
the successor servicer as the servicer of such Mortgage Loan.
Section
10.02 Waiver
of Defaults.
By
a
written notice, the Purchaser may waive any default by the Company in the
performance of its obligations hereunder and its consequences. Upon any waiver
of a past default, such default shall cease to exist, and any Event of Default
arising therefrom shall be deemed to have been remedied for every purpose
of
this Agreement. No such waiver shall extend to any subsequent or other default
or impair any right consequent thereon except to the extent expressly so
waived.
ARTICLE
XI
TERMINATION
Section
11.01 Termination.
This
Agreement shall terminate upon any of: (i) the later of the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or the disposition of any REO Property with respect to the last Mortgage
Loan and the remittance of all funds due hereunder, (ii) mutual consent of
the Company and the Purchaser in writing or (iii) termination pursuant to
Section 10.01, 11.02 or 11.03.
Section
11.02 Termination
Without Cause.
The
Purchaser may terminate, at its sole option, any rights the Company may have
hereunder, without cause, as provided in this Section 11.02. Any such notice
of
termination shall be in writing and delivered to the Company and any Rating
Agency by registered mail as provided in Section 12.05.
The
Company shall be entitled to receive, as such liquidated damages, upon its
termination as servicer hereunder without cause pursuant to this Section
11.02
an amount equal to 2.50% of the aggregate outstanding principal amount of
the
Mortgage Loans as of the termination date paid by the Purchaser to the Company
with respect to all of the Mortgage Loans.
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Section
11.03 Termination
With Cause.
Notwithstanding
any other provision hereof to the contrary, the Purchaser, at its option,
may
terminate this Agreement, and any and all rights that the Company may have
hereunder, with cause upon ten (10) Business Days’ prior written notice. For all
purposes of determining “cause” with respect to termination of this Agreement or
the rights of the Company hereunder, such term shall mean, without limitation,
termination upon the occurrence of any Event of Default hereunder which is
not
cured within any applicable cure period. In the event of a termination of
the
Company for cause under this Section 11.03, no liquidated damages shall be
payable to the Company pursuant to Section 11.02.
ARTICLE
XII
MISCELLANEOUS
PROVISIONS
Section
12.01 Successor
to Company.
Prior
to
termination of the Company’s responsibilities and duties under this Agreement
pursuant to Section 8.04, 10.01 or 11.01, the Purchaser shall, (i) succeed
to
and assume all of the Company’s responsibilities, rights, duties and obligations
under this Agreement, or (ii) appoint a successor having the
characteristics set forth in Section 8.02 and which shall succeed to all
rights
and assume all of the responsibilities, duties and liabilities of the Company
under this Agreement prior to the termination of the Company’s responsibilities,
duties and liabilities under this Agreement. In connection with such appointment
and assumption, the Purchaser may make such arrangements for the compensation
of
such successor out of payments on Mortgage Loans as it and such successor
shall
agree. In the event that the Company’s duties, responsibilities and liabilities
under this Agreement should be terminated pursuant to the aforementioned
sections, the Company shall discharge such duties and responsibilities during
the period from the date it acquires knowledge of such termination until
the
effective date thereof with the same degree of diligence and prudence which
it
is obligated to exercise under this Agreement and shall take no action
whatsoever that might impair or prejudice the rights or financial condition
of
its successor. The resignation or removal of the Company pursuant to the
aforementioned sections shall not become effective until a successor shall
be
appointed pursuant to this Section 12.01 and shall in no event relieve the
Company of the representations and warranties made pursuant to Sections 3.01
and
3.02 and the remedies available to the Purchaser under Sections 2.03, 3.03
and
6.02, it being understood and agreed that the provisions of such Sections
2.03,
3.01, 3.02, 3.03 and 6.02 shall be applicable to the Company notwithstanding
any
such sale, assignment, resignation or termination of the Company or the
termination of this Agreement.
Any
successor appointed, as provided herein, shall execute, acknowledge and deliver
to the Company and the Purchaser an instrument accepting such appointment,
wherein the successor shall make the representations and warranties set forth
in
Section 3.01, except for the portion of subsection (h) relating to sale of
the
mortgage loans and all of subsections (j) and (l) thereof, whereupon such
successor shall become fully vested with all of the rights, powers, duties,
responsibilities, obligations and liabilities of the Company, with like effect
as if originally named as a party to this Agreement. Any termination or
resignation of the Company or termination of this Agreement pursuant to Section
8.04, 10.01, 11.01, 11.02 or 11.03 shall not affect any claims that any
Purchaser may have against the Company arising out of the Company’s actions or
failure to act prior to any such termination or resignation.
-92-
The
Company shall deliver promptly to the successor servicer the funds in the
Custodial Account, Subsidy Account and Escrow Account and all Mortgage Files
and
related documents and statements held by it hereunder and the Company shall
account for all funds and shall execute and deliver such instruments and
do such
other things as may reasonably be required to more fully and definitively
vest
in the successor all such rights, powers, duties, responsibilities, obligations
and liabilities of the Company.
Upon
a
successor’s acceptance of appointment as such, the Company shall notify by mail
the Purchaser of such appointment in accordance with the procedures set forth
in
Section 12.05.
Section
12.02 Amendment.
This
Agreement may be amended from time to time by written agreement signed by
the
Company and the Purchaser.
Section
12.03 Governing
Law.
This
Agreement shall be construed in accordance with the laws of the State of
New
York and the obligations, rights and remedies of the parties hereunder shall
be
determined in accordance with such laws.
Each
of
the Company and the Purchaser hereby knowingly, voluntarily and intentionally
waives any and all rights it may have to a trial by jury in respect or any
litigation based on, or arising out of, under, or in connection with, this
Agreement, or any other documents and instruments executed in connection
herewith, or any course of conduct, course of dealing, statements (whether
oral
or written), or actions of the Company or the Purchaser. This provision is
a
material inducement for the Purchaser to enter into this Agreement.
Section
12.04 Duration
of Agreement.
This
Agreement shall continue in existence and effect until terminated as herein
provided. This Agreement shall continue notwithstanding transfers of the
Mortgage Loans by the Purchaser.
Section
12.05 Notices.
All
demands, notices and communications hereunder shall be in writing and shall
be
deemed to have been duly given if personally delivered at or mailed by
registered mail, postage prepaid, addressed as follows:
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(1) if
to the
Company with respect to servicing issues:
Xxxxx
Fargo Bank, N.A.
1
Home
Campus, MAC #0000-000
Xxx
Xxxxxx, Xxxx 00000-0000
Attention:
Xxxx X. Xxxxx
Tel:
(000) 000-0000; Fax: (000) 000-0000
if
to the
Company with respect to all other issues:
Xxxxx
Fargo Bank, N.A.
7430
New
Technology Way, MAC X3906-012
Xxxxxxxxx,
Xxxxxxxx 00000
Attention:
Structured Finance Manager
Fax:
(000) 000-0000
in
each
instance with a copy to:
Xxxxx
Fargo Bank, N.A.
1
Home
Campus, MAC #X2401-06T
Xxx
Xxxxxx, Xxxx 00000-0000
Attention:
General Counsel
Tel:
(000) 000-0000; Fax: (000) 000-0000
or
such
other address as may hereafter be furnished to the Purchaser in writing by
the
Company; and
(2) if
to
Purchaser:
Xxxxxxx
Xxxxx Mortgage Company
000
Xxxxxx Xxxxxx Xxxxx, Xxxxx 000 Xxxxx
Xx.
Xxxxxxxxxx, XX 00000
Attention:
Xxxxxxx Xxxxxxxx
Tel:
(000) 000-0000; Fax: (000) 000-0000
With
a
copy to:
Xxxxxxx
Xxxxx Mortgage Company
00
Xxxxx
Xxxxxx, Xxx Xxxx, XX 00000
Attention:
Xxx Xxxxx
Tel:
(000) 000-0000; Fax: (000) 000-0000
or
such
other address as may hereafter be furnished to the Company in writing by
the
Purchaser.
Section
12.06 Severability
of Provisions.
If
any
one or more of the covenants, agreements, provisions or terms of this Agreement
shall be held invalid for any reason whatsoever, then such covenants,
agreements, provisions or terms shall be deemed severable from the remaining
covenants, agreements, provisions or terms of this Agreement and shall in
no way
affect the validity or enforceability of the other provisions of this
Agreement.
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Section
12.07 Relationship
of Parties.
Nothing
herein contained shall be deemed or construed to create a partnership or
joint
venture between the parties hereto and the services of the Company shall
be
rendered as an independent contractor and not as agent for the
Purchaser.
Section
12.08 Execution;
Successors and Assigns.
This
Agreement may be executed in one or more counterparts and by the different
parties hereto on separate counterparts, each of which, when so executed,
shall
be deemed to be an original; such counterparts, together, shall constitute
one
and the same agreement. Subject to Section 8.04 hereof, this Agreement shall
inure to the benefit of and be binding upon, and shall be enforceable by,
the
Company and the Purchaser and their respective successors and assigns, including
without limitation, any trustee appointed by the Purchaser with respect to
any
Whole Loan Transfer or Securitization Transaction.
Section
12.09 Recordation
of Assignments of Mortgage.
To
the
extent permitted by Applicable Law, as to any Mortgage Loan which is not
a MERS
Mortgage Loan, each of the Assignments of Mortgage is subject to recordation
in
all appropriate public offices for real property records in all the counties
or
other comparable jurisdictions in which any or all of the Mortgaged Properties
are situated, and in any other appropriate public recording office or elsewhere,
which recordation shall have been effected at the Company’s expense in the event
recordation is either necessary under Applicable Law or requested by the
Purchaser at its sole option.
Section
12.10 Assignment
by Purchaser.
The
Purchaser shall have the right, without the consent of the Company but subject
to the limit set forth in Section 2.02 hereof, to assign, in whole or in
part,
its interest under this Agreement with respect to some or all of the Mortgage
Loans, and designate any Person to exercise any rights of the Purchaser
hereunder, by executing an Assignment, Assumption and Recognition Agreement(s)
substantially in the form(s) of Exhibit F-1 hereto, with respect to any Mortgage
Loan that is subject to a Securitization Transaction in which Xxxxxx Xxx
or
Xxxxxxx Mac provides a guarantee for some or all of the securities issued
therein or Form F-2 hereto, for Mortgage Loans subject to all other
Securitization Transactions, and the assignee or designee shall accede to
the
rights and obligations hereunder of the Purchaser with respect to such Mortgage
Loans. All references to the Purchaser in this Agreement shall be deemed
to
include its assignee or designee.
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Section
12.11 Solicitation
of Mortgagor.
Neither
party shall, after each Closing Date, take any action to solicit the refinancing
of any Mortgage Loan. It is understood and agreed that neither (i) promotions
undertaken by either party or any affiliate of either party which are directed
to the general public at large, including, without limitation, mass mailings
based upon commercially acquired mailing lists, newspaper, radio, television
advertisements nor (ii) serving the refinancing needs of a Mortgagor who,
without solicitation, contacts either party in connection with the refinancing
of such Mortgage or Mortgage Loan, shall constitute solicitation under this
Section 12.11.
Section
12.12 General
Interpretative Principles.
For
purposes of this Agreement, except as otherwise expressly provided or unless
the
context otherwise requires:
|
(a)
|
the
terms defined in this Agreement have the meanings assigned to them
in this
Agreement and include the plural as well as the singular, and the
use of
any gender herein shall be deemed to include the other
gender;
|
|
(b)
|
any
reference in this Agreement to this Agreement or any other agreement,
document, or instrument shall be a reference to this Agreement
or any
other such agreement, document, or instrument as the same has been
amended, modified, or supplemented in accordance with the terms
hereof and
thereof (as applicable);
|
|
(c)
|
accounting
terms not otherwise defined herein have the meanings assigned to
them in
accordance with generally accepted accounting
principles;
|
|
(d)
|
references
herein to “Articles,” “Sections,” “Subsections,” “Paragraphs, ” and other
subdivisions without reference to a document are to designated
articles,
sections, subsections, paragraphs and other subdivisions of this
Agreement, unless the context shall otherwise
require;
|
|
(e)
|
a
reference to a subsection without further reference to a section
is a
reference to such subsection as contained in the same section in
which the
reference appears, and this rule shall also apply to Paragraphs
and other
subdivisions;
|
|
(f)
|
a
reference to a “day” shall be a reference to a calendar
day;
|
|
(g)
|
the
words “herein,” “hereof,” “hereunder” and other words of similar import
refer to this Agreement as a whole and not to any particular provision;
and
|
|
(h)
|
the
terms “include” and “including” shall mean without limitation by reason of
enumeration.
|
-96-
IN
WITNESS WHEREOF, the Company and the Purchaser have caused their names to
be
signed hereto by their respective duly authorized officers as of the day
and
year first above written.
XXXXXXX
SACHS MORTGAGE
COMPANY,
as Purchaser
By: Xxxxxxx
Xxxxx Real Estate Funding Corp.,
General
Partner
By:
Name:
Title:
XXXXX
FARGO BANK, N.A.,
as
Company
By:
Name:
Title:
STATE
OF
NEW YORK )
) ss.:
COUNTY
OF
NEW YORK )
On
the
_____ day of __________, 2004 before me, a Notary Public in and for said
State,
personally appeared ____________________, known to me to be the
______________________ of Xxxxxxx Xxxxx Real Estate Funding Corp., the general
partner of Xxxxxxx Sachs Mortgage Company, the partnership that executed
the
within instrument and also known to me to be the person who executed it on
behalf of said partnership, and acknowledged to me that such corporation
executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand affixed my office seal the day
and
year in this certificate first above written.
Notary
Public
My
commission expires:
STATE
OF
MARYLAND )
) ss:
COUNTY
OF
WASHINGTON )
On
the
_____ day of __________, 2004 before me, a Notary Public in and for said
State,
personally appeared _________________, known to me to be the ___________________
of Xxxxx Fargo Bank, N.A., the national banking organization that executed
the
within instrument and also known to me to be the person who executed it on
behalf of said bank, and acknowledged to me that such bank executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand affixed my office seal the day
and
year in this certificate first above written.
Notary
Public
My
commission expires:
EXHIBIT
A
MORTGAGE
LOAN SCHEDULE
[See
Schedule A to Assignment and Conveyance Agreement.]
A-1
EXHIBIT
B
CONTENTS
OF EACH MORTGAGE FILE
With
respect to each Mortgage Loan, the Mortgage File shall include each of the
following items, which shall be available for inspection by the Purchaser
and
any prospective Purchaser, and which shall be retained by the Company in
the
Servicing File or delivered to the Custodian pursuant to Sections 2.01 and
2.03
of the Master Seller’s Warranties and the Servicing Agreement to which this
Exhibit is attached (the “Agreement”):
|
1.
|
The
original Mortgage Note bearing all intervening endorsements, endorsed
“Pay
to the order of ______________, without recourse” and signed in the name
of the Company by an authorized officer (in the event that the
Mortgage
Loan was acquired by the Company in a merger, the signature must
be in the
following form: “[Company], successor by merger to [name of predecessor]”;
and in the event that the Mortgage Loan was acquired or originated
by the
Company while doing business under another name, the signature
must be in
the following form: “[Company], formerly know as [previous
name]”).
|
|
2.
|
The
original of any personal endorsement, surety and/or guaranty agreement
executed in connection with the Mortgage Note, if
any.
|
|
3.
|
Except
as set forth below, and for each mortgage loan that is not a MERS
Mortgage
Loan, the original Mortgage, with evidence of recording thereon
or a
certified true and correct copy of the Mortgage sent for recordation.
If
in connection with any Mortgage Loan, the Company cannot deliver
or cause
to be delivered the original Mortgage with evidence of recording
thereon
on or prior to the Closing Date because of a delay caused by the
public
recording office where such Mortgage has been delivered for recordation
or
because such Mortgage has been lost or because such public recording
office retains the original recorded Mortgage, the Company shall
deliver
or cause to be delivered to the Custodian, a photocopy of such
Mortgage,
together with (i) in the case of a delay caused by the public
recording office, an Officer’s Certificate of the Company stating that
such Mortgage has been dispatched to the appropriate public recording
office for recordation and that the original recorded Mortgage
or a copy
of such Mortgage certified by such public recording office to be
a true
and complete copy of the original recorded Mortgage will be promptly
delivered to the Custodian upon receipt thereof by the Company;
or
(ii) in the case of a Mortgage where a public recording office
retains the original recorded Mortgage or in the case where a Mortgage
is
lost after recordation in a public recording office, a copy of
such
Mortgage certified by such public recording office or by the title
insurance company that issued the title policy to be a true and
complete
copy of the original recorded
Mortgage.
|
|
4.
|
The
originals or certified true copies of all assumption, modification,
consolidation or extension agreements, with evidence of recording
noted
thereon if recordation is required to maintain the lien of the
mortgage or
is otherwise required, or, if recordation is not so required, an
original
or copy of any such assumption, modification, consolidation or
extension
agreements.
|
B-1
|
5.
|
The
original Assignment of Mortgage for each Mortgage Loan, in form
and
substance acceptable for recording, from the Company to “______________”
or as otherwise directed by the Purchaser. If the Mortgage Loan
was
acquired by the Company in a merger, the Assignment of Mortgage
must be
made by “[Company], successor by merger to [name of predecessor].” If the
Mortgage Loan was acquired or originated by the Company while doing
business under another name, the Assignment of Mortgage must be
by
“[Company], formerly know as [previous name].” Subject to the foregoing
and where permitted under the Applicable Laws of the jurisdiction
wherein
the Mortgaged Property is located, such Assignments of Mortgage
may be
made by blanket assignments for Mortgage Loans secured by the Mortgaged
Properties located in the same
county.
|
|
6.
|
Originals
or certified true copies of all intervening assignments of the
Mortgage
necessary to show a complete chain of title from the original mortgagee
to
the Company, with evidence of recording thereon, or if any such
intervening assignment has not been returned from the applicable
recording
office or has been lost or if such public recording office retains
the
original recorded assignments of mortgage, the Company shall deliver
or
cause to be delivered to the Custodian, a photocopy of such intervening
assignment, together with (i) in the case of a delay caused by the
public recording office, an Officer’s Certificate of the Company stating
that such intervening assignment of mortgage has been dispatched
to the
appropriate public recording office for recordation and that such
original
recorded intervening assignment of mortgage or a copy of such intervening
assignment of mortgage certified by the appropriate public recording
office or by the title insurance company that issued the title
policy to
be a true and complete copy of the original recorded intervening
assignment of mortgage will be promptly delivered to the Custodian
upon
receipt thereof by the Company; or (ii) in the case of an intervening
assignment where a public recording office retains the original
recorded
intervening assignment or in the case where an intervening assignment
is
lost after recordation in a public recording office, a copy of
such
intervening assignment certified by such public recording office
to be a
true and complete copy of the original recorded intervening
assignment.
|
|
7.
|
With
respect to the Non-Conventional Mortgage Loans, the MIC, LGC or
Loan Note
Guarantee, as applicable, where required pursuant to the Agreement,
or any
other evidence of FHA insurance coverage or VA or RHS guaranty,
as the
case may be, that is acceptable to the
Purchaser.
|
|
8.
|
The
original mortgage policy of title insurance or other evidence of
title
such as a copy of the title commitment or copy of the preliminary
title
commitment.
|
|
9.
|
Any
security agreement, chattel mortgage or equivalent executed in
connection
with the Mortgage.
|
B-2
With
respect to each Mortgage Loan, the Mortgage File shall include each of the
following items to the extent in the possession of the Company or in the
possession of the Company’s agent(s):
|
10.
|
With
respect to Conventional Mortgage Loans, verification of the Primary
Mortgage Insurance Policy.
|
|
11.
|
The
original hazard insurance policy and, if required by law, flood
insurance
policy, in accordance with Section 4.10 of the
Agreement.
|
|
12.
|
Residential
loan application.
|
|
13.
|
Mortgage
Loan closing statement.
|
|
14.
|
Verification
of employment and income, unless originated under the Company’s Limited
Documentation program, Xxxxxx Mae Timesaver
Plus.
|
|
15.
|
Verification
of acceptable evidence of source and amount of down
payment.
|
|
16.
|
Credit
report on the Mortgagor, if
available.
|
|
17.
|
Residential
appraisal report.
|
|
18.
|
Photograph
of the Mortgaged Property.
|
|
19.
|
Survey
of the Mortgaged Property, if required by the title company or
Applicable
Law.
|
|
20.
|
Copy
of each instrument necessary to complete identification of any
exception
set forth in the exception schedule in the title policy, i.e.,
map or
plat, restrictions, easements, sewer agreements, home association
declarations, etc.
|
|
21.
|
All
required disclosure statements.
|
|
22.
|
If
available, termite report, structural engineer’s report, water potability
and septic certification.
|
|
23.
|
Sales
contract, if applicable.
|
|
24.
|
Evidence
of payment of taxes and insurance premiums, insurance claim files,
correspondence, current and historical computerized data files,
and all
other processing, underwriting and closing papers and records which
are
customarily contained in a mortgage loan file and which are required
to
document the Mortgage Loan or to service the Mortgage
Loan.
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|
25.
|
Amortization
schedule, if available.
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26.
|
Original
power of attorney, if
applicable.
|
B-3
In
the
event an Officer’s Certificate of the Company is delivered to the Custodian
because of a delay caused by the public recording office in returning any
recorded document, the Company shall deliver to the Custodian, within 240
days
of the related Closing Date, an Officer’s Certificate which shall
(i) identify the recorded document, (ii) state that the recorded
document has not been delivered to the Custodian due solely to a delay caused
by
the public recording office, (iii) state the amount of time generally
required by the applicable recording office to record and return a document
submitted for recordation, and (iv) specify the date the applicable
recorded document will be delivered to the Custodian. The Company shall be
required to deliver to the Custodian the applicable recorded document by
the
date specified in sub clause (iv) above. An extension of the date specified
in sub clause (iv) above may be requested from the Purchaser, which consent
shall not be unreasonably withheld.
Notwithstanding
sub-clauses 1 and 6 above, the Purchaser acknowledges that the Company may
deliver (i) a Mortgage Note for which the chain of endorsements is not identical
to that of the intervening Assignments of Mortgage with respect to such Mortgage
Note, which shall not affect the enforceability of such Mortgage Note, and/or
(ii) intervening Assignments of Mortgage which are not identical to the chain
of
endorsements with respect to such Mortgage Note, which shall not affect the
validity of such intervening Assignment of Mortgage; provided, however, that
such acknowledgement shall in no way operate to negate the Purchaser’s remedies
for the Company’s breach of the representations and warranties under this
Agreement.
B-4
EXHIBIT
C
FORM
OF CUSTODIAL AGREEMENT
See
attached
C-1
EXHIBIT
D
FORM
OF OPINION OF COUNSEL
|
Re:
|
Sale
of Series [ ] Mortgage
Loans by
|
Xxxxx
Fargo Bank, N.A., to
Xxxxxxx
Sachs Mortgage Company
Dear
Sir/Madam:
I
am
_____ of Xxxxx Fargo Bank, N.A. and have acted as counsel to Xxxxx Fargo
Bank,
N.A. (the “Company”), with respect to certain matters in connection with the
sale by the Company of certain mortgage loans (the “Mortgage Loans”) pursuant to
that certain Amended and Restated Master Seller’s Warranties and Servicing
Agreement designated as Mortgage Loan Series the “Amended and Restated Master
Seller’s Warranties and Servicing Agreement” by and between the Company and
Xxxxxxx Xxxxx Mortgage Company (the “Purchaser”), dated as of March 1, 2006,
which sale is in the form of whole Mortgage Loans. The Mortgage Loans are
listed
on Schedule A to the Assignment and Conveyance Agreement. Capitalized terms
not
otherwise defined herein have the meanings set forth in the Amended and Restated
Master Seller’s Warranties and Servicing Agreement.
I
have
examined the following documents:
1. the
Amended and Restated Master Seller’s Warranties and Servicing
Agreement;
2. the
Custodial Agreement;
3. the
form
of endorsement of the Mortgage Notes; and
4. such
other documents, records and papers as I have deemed necessary and relevant
as a
basis for this opinion.
To
the
extent I have deemed necessary and proper, I have relied upon the
representations and warranties of the Company contained in the Amended and
Restated Master Seller’s Warranties and Servicing Agreement. I have assumed the
authenticity of all documents submitted to me as originals, the genuineness
of
all signatures, the legal capacity of natural persons and the conformity
to the
originals of all documents.
Based
upon the foregoing, it is my opinion that:
The
Company is a national banking association duly organized, validly existing
and
in good standing under the laws of the United States.
The
Company has the power to engage in the transactions contemplated by the Amended
and Restated Master Seller’s Warranties and Servicing Agreement and the
Custodial Agreement and all requisite power, authority and legal right to
execute and deliver the Amended and Restated Master Seller’s Warranties and
Servicing Agreement, the Custodial Agreement and the Mortgage Loans, and
to
perform and observe the terms and conditions of such
instruments.
D-1
Each
person who, as an officer or attorney-in-fact of the Company, signed
(a) the Amended and Restated Master Seller’s Warranties and Servicing
Agreement, (b) the Custodial Agreement , and (c) any other document
delivered prior hereto or on the date hereof in connection with the sale
and
servicing of the Mortgage Loans in accordance with the Amended and Restated
Master Seller’s Warranties and Servicing Agreement and the person was, at the
respective times of such signing and delivery, and is, as of the date hereof,
duly elected or appointed, qualified and acting as such officer or
attorney-in-fact, and the signatures of such persons appearing on such documents
are their genuine signatures.
Each
of
the Amended and Restated Master Seller’s Warranties and Servicing Agreement, the
Custodial Agreement and the Mortgage Loans, has been duly authorized, executed
and delivered by the Company and is a legal, valid and binding agreement
enforceable in accordance with its terms, subject to the effect of insolvency,
liquidation, conservatorship and other similar laws administered by the Federal
Deposit Insurance Corporation affecting the enforcement of contract obligations
of insured banks and subject to the application of the rules of equity,
including those respecting the availability of specific performance, none
of
which will materially interfere with the realization of the benefits provided
thereunder or with the Purchaser’s ownership of the Mortgage Loans.
The
Company has been duly authorized to allow any of its officers to execute
any and
all documents by original or facsimile signature in order to complete the
transactions contemplated by the Amended and Restated Master Seller’s Warranties
and Servicing Agreement and the Custodial Agreement, and in order to execute
the
endorsements to the Mortgage Notes and the assignments of the Mortgages,
and the
original or facsimile signature of the officer at the Company executing the
Amended and Restated Master Seller’s Warranties and Servicing Agreement, the
Custodial Agreement, the endorsements to the Mortgage Notes and the assignments
of the Mortgages represents the legal and valid signature of said officer
of the
Company.
Either
(i) no consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Company of or compliance by the Company with the Amended
and
Restated Master Seller’s Warranties and Servicing Agreement, the Custodial
Agreement or the sale and delivery of the Mortgage Loans or the consummation
of
the transactions contemplated by the Amended and Restated Master Seller’s
Warranties and Servicing Agreement and the Custodial Agreement; or (ii) any
required consent, approval, authorization or order has been obtained by the
Company.
Neither
the consummation of the transactions contemplated by, nor the fulfillment
of the
terms of the Amended and Restated Master Seller’s Warranties and Servicing
Agreement and the Custodial Agreement, will conflict with or results in or
will
result in a breach of or constitutes or will constitute a default under the
charter or by-laws of the Company, the terms of any indenture or other agreement
or instrument to which the Company is a party or by which it is bound or
to
which it is subject, or violates any statute or order, rule, regulations,
writ,
injunction or decree of any court, governmental authority or regulatory body
to
which the Company is subject or by which it is bound.
D-2
There
is
no action, suit, proceeding or investigation pending or, to the best of my
knowledge, threatened against the Company which, in my opinion, either in
any
one instance or in the aggregate, may result in any material adverse change
in
the business, operations, financial condition, properties or assets of the
Company or in any material impairment of the right or ability of the Company
to
carry on its business substantially as now conducted or in any material
liability on the part of the Company or which would draw into question the
validity of the Amended and Restated Master Seller’s Warranties and Servicing
Agreement, and the Custodial Agreement, or of any action taken or to be taken
in
connection with the transactions contemplated thereby, or which would be
likely
to impair materially the ability of the Company to perform under the terms
of
the Amended and Restated Master Seller’s Warranties and Servicing Agreement and
the Custodial Agreement.
For
purposes of the foregoing, I have not regarded any legal or governmental
actions, investigations or proceedings to be “threatened” unless the potential
litigant or governmental authority has manifested to the legal department
of the
Company or an employee of the Company responsible for the receipt of process
a
present intention to initiate such proceedings; nor have I regarded any legal
or
governmental actions, investigations or proceedings as including those that
are
conducted by state or federal authorities in connection with their routine
regulatory activities. The sale of each Mortgage Note and Mortgage as and
in the
manner contemplated by the Amended and Restated Master Seller’s Warranties and
Servicing Agreement is sufficient fully to transfer all right, title and
interest of the Company thereto as noteholder and mortgagee, apart from the
rights to service the Mortgage Loans pursuant to the Amended and Restated
Master
Seller’s Warranties and Servicing Agreement.
The
form
of endorsement that is to be used with respect to the Mortgage Loans is legally
valid and sufficient to duly endorse the Mortgage Notes to the Purchaser.
Upon
the completion of the endorsement of the Mortgage Notes and the completion
of
the assignments of the Mortgages, and the recording thereof, the endorsement
of
the Mortgage Notes, the delivery to the Custodian of the completed assignments
of the Mortgages, and the delivery of the original endorsed Mortgage Notes
to
the Custodian would be sufficient to permit the entity to which such Mortgage
Note is initially endorsed at the Purchaser’s direction, and to whom such
assignment of Mortgages is initially assigned at the Purchaser’s direction, to
avail itself of all protection available under Applicable Law against the
claims
of any present or future creditors of the Company, and would be sufficient
to
prevent any other sale, transfer, assignment, pledge or hypothecation of
the
Mortgages and the Mortgage Notes by the Company from being enforceable, such
that in a properly presented and argued case under title 11, United States
Code
(the “Bankruptcy Code”), in which the Company were the debtor, a bankruptcy
court having jurisdiction over the Company would consider the transfer of
the
Mortgage Loans from the Company to the Purchaser to be a true sale of the
Mortgage Loans from the Company to the Purchaser and not a secured loan by
the
Purchaser to the Company and, accordingly, the Mortgage Loans and the payments
and other collections thereon (other than those at any given time that may
be
commingled with unrelated funds held by the Company) and the proceeds
thereof transferred to the Purchaser by the Company in accordance with the
Company’s Warranties and Servicing Agreement would not be deemed property of the
Company’s estate for purposes of Section 541 of the Bankruptcy Code or be
subject to the automatic stay provisions of Section 362 of the Bankruptcy
Code.
D-3
This
opinion is given to you for your sole benefit, and no other person or entity
is
entitled to rely hereon except that the purchaser or purchasers to which
you
initially and directly resell the Mortgage Loans may rely on this opinion
as if
it were addressed to them as of its date.
Sincerely,
D-4
EXHIBIT
E
ITEMS
TO BE INCLUDED IN MONTHLY REMITTANCE ADVICE
On
each
Closing Date, the Company shall deliver to the Purchaser an initial set-up
report (the “Initial Set-up Report”), dated as of the related Cut-off Date,
which shall set forth certain information regarding the related pool of Mortgage
Loans. Such information shall include, without limitation, the principal
balance
of each Mortgage Loan, the interest rate, delinquency status and any other
information requested by the Purchaser. For each month after each Closing
Date,
the Company shall provide a monthly remittance advice report (the “Monthly
Remittance Advice Reports”) to the Purchaser, which shall set forth for each
related Mortgage Loan, the trial balance, interest rate, delinquency,
foreclosure and related default information, and such other information as
may
be requested by the Purchaser. The Initial Set-up Report and the Monthly
Remittance Advice Reports will be delivered in an Excel format or in such
other
electronic format as agreed to by the parties. Each Initial Set-up Report
and
Monthly Remittance Advice Report shall contain only such information as is
readily available to the Company and is mutually agreed to by the Company
and
the Purchaser.
E-1
EXHIBIT
F-1
FORM
OF ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
ASSIGNMENT,
ASSUMPTION AND RECOGNITION AGREEMENT made this ___ day of ________, 200_
(this
“Agreement”), among Xxxxx Fargo Bank, N.A., as servicer (the “Servicer”),
_______________________, as assignee (the “Assignee”), and
_____________________, as assignor (the “Depositor”) and as acknowledged by
_______________________, as master servicer (the “Master
Servicer”).
WHEREAS,
Xxxxxxx Sachs Mortgage Company (the “Assignor”) and the Servicer have entered
into the Amended and Restated Master Seller’s Warranties and Servicing Agreement
dated as of March 1, 2006 (the “Sale and Servicing Agreement”) pursuant to which
the Servicer sold certain mortgage loans listed on the mortgage loan schedule
attached as an exhibit to the Assignment and Conveyance Agreement;
WHEREAS,
the Assignor, the Depositor and the Servicer have entered into an Assignment,
Assumption and Recognition Agreement dated as of ________, 200_ (the “GSMC
Assignment Agreement”), pursuant to which the Assignor assigned its right title
and interest in and to the Mortgage Loans and the Sale and Servicing Agreement
to the Depositor;
WHEREAS,
the Assignee has agreed on certain terms and conditions to purchase from
the
Depositor certain mortgage loans (the “Mortgage Loans”), which Mortgage Loans
are subject to the provisions of the Sale and Servicing Agreement and are
listed
on the mortgage loan schedule attached as Exhibit
1
hereto
(the “Mortgage Loan Schedule”); and
WHEREAS,
pursuant to a Master Servicing and Trust Agreement, dated as of _______,
200_
(together with the _______ 200_ Edition of the Standard Terms thereto, the
“Trust Agreement”), among _______________________, as depositor, Xxxxxxx Xxxxx
Mortgage Company, as Assignor, _______________________, as master servicer
(the
“Master Servicer”), _______________________, as guarantor (the
“Guarantor”)_______________________, as Trustee (the “Trustee”), and
_______________________, as custodian (the “Custodian”), the Depositor will
transfer the Mortgage Loans to the Trustee on behalf of the Assignee, together
with the Depositor’s rights in the Sale and Servicing Agreement.
NOW
THEREFORE, in consideration of the mutual promises contained herein and other
good and valuable consideration, the receipt and sufficiency of which are
hereby
acknowledged, the parties agree as follows:
1. Assignment
and Assumption.
(a) The
Depositor hereby assigns to the Assignee, as of the date hereof, all of its
right, title and interest in and to the Mortgage Loans and the Sale and
Servicing Agreement, to the extent relating to the Mortgage Loans, and the
Assignee hereby assumes all of the Depositor’s obligations under the Sale and
Servicing Agreement, to the extent relating to the Mortgage Loans from and
after
________, 200_; the Servicer hereby acknowledges such assignment and assumption
and hereby agrees to the release of the Depositor from any obligations under
the
Sale and Servicing Agreement from and after _____, 200_, to the extent relating
to the Mortgage Loans.
(b) The
Depositor represents and warrants to the Assignee that the Depositor has
not
taken any action which would serve to impair or encumber the Depositor’s
ownership interest in the Mortgage Loans since the date of the Sale and
Servicing Agreement.
(c) The
Servicer and the Depositor, with the consent of the Guarantor, shall have
the
right to amend, modify or terminate the Sale and Servicing Agreement without
the
joinder of the Assignee with respect to mortgage loans not conveyed to the
Assignee hereunder; provided, however, that such amendment, modification
or
termination shall not affect or be binding on the Assignee.
2. Accuracy
of the Sale and Servicing Agreement.
The
Servicer and the Depositor represent and warrant to the Assignee that (i)
attached hereto as Exhibit 2 is a true, accurate and complete copy of the
Sale
and Servicing Agreement, (ii) the Sale and Servicing Agreement is in full
force
and effect as of the date hereof, (iii) the Sale and Servicing Agreement
has not
been amended or modified in any respect, other than by the amendments described
in the recitals hereto and appended to such Sale and Servicing Agreement
and
(iv) no notice of termination has been given to the Servicer under the Sale
and
Servicing Agreement. The Servicer, in its capacity as seller and/or servicer
under the Sale and Servicing Agreement, further represents and warrants that
the
representations and warranties contained in Section 3.01 of the Sale and
Servicing Agreement are true and correct as of the Closing Date (as defined
in
the Trust Agreement).
3. Recognition
of Assignee; Recognition of Master Servicer.
(a) From
and
after the date hereof, the Servicer shall note the transfer of the Mortgage
Loans to the Assignee in its books and records, shall recognize the Assignee
as
the owner of the Mortgage Loans and shall, subject to clause (b) below, service
the Mortgage Loans for the benefit of the Assignee pursuant to the Sale and
Servicing Agreement, the terms of which are incorporated herein by reference.
It
is the intention of the Depositor, Servicer and the Assignee that the Sale
and
Servicing Agreement shall be binding upon and inure to the benefit of the
Servicer and the Assignee and their successors and assigns.
(b) The
Servicer further acknowledges that, from and after the date hereof, it (and
any
of its successors under the Sale and Servicing Agreement) will be subject
to the
supervision of the Master Servicer (except that the Master Servicer shall
not be
responsible for supervising the servicing of defaulted Mortgage Loans and
REO
Properties) and that the Master Servicer, acting on behalf of the Trustee
as the
owner of the Mortgage Loans, shall have the same rights as were assigned
by the
Assignor, in its capacity as the original purchaser under the Sale and Servicing
Agreement, to the Depositor under the GSMC Assignment Agreement, and further
assigned by the Depositor to the Trustee, on behalf of the Trust, hereunder.
Such rights will include, without limitation, the right to terminate the
Servicer under the Sale and Servicing Agreement upon the occurrence of an
event
of default thereunder, the right to receive all remittances required to be
made
by the Servicer under the Sale and Servicing Agreement, the right to receive
all
monthly reports and other data required to be delivered by the Servicer under
the Sale and Servicing Agreement, indemnification rights and the right to
exercise certain rights of consent and approval relating to actions taken
by the
Servicer.
F-1-2
(c) All
reports, notices and other written information required to be delivered to
the
Trustee, as the successor in interest to the Assignor and the Depositor under
the Sale and Servicing Agreement, shall also be delivered to the Master Servicer
at the address set forth in Section 10 hereof. All remittances required to
be
made to the Trustee, as the successor in interest to the Assignor and the
Depositor under the Sale and Servicing Agreement, shall be made instead to
the
Master Servicer by wire transfer to the following account:
ABA#
[
]
For
credit to: SAS CLEARING
Account
Number:
[
]
For
further credit to:
Collection Acct#
[
]
4. Representations
and Warranties of the Assignee.
The
Assignee hereby represents and warrants to the Assignor as follows:
(a) Decision
to Purchase.
The
Assignee represents and warrants that it is a sophisticated investor able
to
evaluate the risks and merits of the transactions contemplated hereby, and
that
it has not relied in connection therewith upon any statements or representations
of the Depositor or the Servicer other than those contained in the Sale and
Servicing Agreement or this Agreement.
(b) Authority.
The
Assignee hereto represents and warrants that it is duly and legally authorized
to enter into this Agreement and to perform its obligations hereunder and
under
the Sale and Servicing Agreement.
(c) Enforceability.
The
Assignee hereto represents and warrants that this Agreement has been duly
authorized, executed and delivered by it and (assuming due authorization,
execution and delivery thereof by each of the other parties hereto) constitutes
its legal, valid and binding obligation, enforceable in accordance with its
terms, except as such enforcement may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of creditors’
rights generally and by general equitable principles (regardless of whether
such
enforcement is considered in a proceeding in equity or at law).
5. Representations
and Warranties of the Depositor.
The
Depositor hereby represents and warrants to the Assignee as
follows:
(a) Organization.
The
Depositor has been duly organized and is validly existing as a limited
partnership in good standing under the laws of the State of New York with
full
power and authority (corporate and other) to enter into and perform its
obligations under the Sale and Servicing Agreement and this
Agreement.
(b) Enforceability.
This
Agreement has been duly executed and delivered by the Depositor, and, assuming
due authorization, execution and delivery by each of the other parties hereto,
constitutes a legal, valid, and binding agreement of the Depositor, enforceable
against it in accordance with its terms, subject to bankruptcy, insolvency,
reorganization, moratorium, or other similar laws affecting creditors’ rights
generally and to general principles of equity regardless of whether enforcement
is sought in a proceeding in equity or at law.
F-1-3
(c) No
Consent.
The
execution, delivery and performance by the Depositor of this Agreement and
the
consummation of the transactions contemplated thereby do not require the
consent
or approval of, the giving of notice to, the registration with, or the taking
of
any other action in respect of, any state, federal or other governmental
authority or agency, except such as has been obtained, given, effected or
taken
prior to the date hereof.
(d) Authorization;
No Breach.
The
execution and delivery of this Agreement have been duly authorized by all
necessary corporate action on the part of the Depositor; neither the execution
and delivery by the Depositor of this Agreement, nor the consummation by
the
Depositor of the transactions herein contemplated, nor compliance by the
Depositor with the provisions hereof, will conflict with or result in a breach
of, or constitute a default under, any of the provisions of the governing
documents of the Depositor or any law, governmental rule or regulation or
any
material judgment, decree or order binding on the Depositor or any of its
properties, or any of the provisions of any material indenture, mortgage,
deed
of trust, contract or other instrument to which the Depositor is a party
or by
which it is bound.
(e) Actions;
Procedures.
There
are no actions, suits or proceedings pending or, to the knowledge of the
Depositor, threatened, before or by any court, administrative agency, arbitrator
or governmental body (A) with respect to any of the transactions contemplated
by
this Agreement or (B) with respect to any other matter that in the judgment
of
the Depositor will be determined adversely to the Depositor and will if
determined adversely to the Depositor materially adversely affect its ability
to
perform its obligations under this Agreement.
(f) Prior
Assignments;
Pledges.
Except
for the sale to the Assignee, the Depositor has not assigned or pledged any
Mortgage Note or the related Mortgage or any interest or participation
therein.
(g) Releases.
The
Depositor has not satisfied, canceled, or subordinated in whole or in part,
or
rescinded any Mortgage, and the Depositor has not released any Mortgaged
Property from the lien of the related Mortgage, in whole or in part, nor
has the
Depositor executed an instrument that would effect any such release,
cancellation, subordination, or rescission. The Depositor has not released
any
Mortgagor, in whole or in part, except in connection with an assumption
agreement or other agreement approved by the FHA, VA or RHS, as applicable,
to
the extent such approval was required.
It
is
understood and agreed that the representations and warranties set forth in
this
Section 5 shall survive delivery of the respective Mortgage Files to the
Custodian and shall inure to the benefit of the Assignee and its assigns
notwithstanding any restrictive or qualified endorsement or assignment. Upon
the
discovery by the Depositor, the Master Servicer or the Trustee of a breach
of
the foregoing representations and warranties, the party discovering such
breach
shall give prompt written notice thereof to the other parties to this Agreement,
and in no event later than two (2) Business Days from the date of such
discovery. It is understood and agreed that the obligations of the Depositor
set
forth in Section 6 to repurchase a Mortgage Loan constitute the sole remedies
available to the Assignee and its assigns on their behalf respecting a breach
of
the representations and warranties contained in this Section 5.
F-1-4
It
is
understood and agreed that the Depositor has made no representations or
warranties to the Assignee other than those contained in this Section 5,
and no
other affiliate of the Depositor has made any representations or warranties
of
any kind to the Assignee.
6. Repurchase
of Mortgage Loans.
Upon
discovery or notice of any breach by the Depositor of any representation,
warranty, or covenant under this Agreement that materially and adversely
affects
the value of any Mortgage Loan or the interest of the Assignee therein (it
being
understood that any such defect or breach shall be deemed to have materially
and
adversely affected the value of the related Mortgage Loan or the interest
of the
Assignee therein if the Assignee incurs a loss as a result of such defect
or
breach), the Assignee promptly shall request that the Depositor cure such
breach
and, if the Depositor does not cure such breach in all material respects
within
60 days from the date on which it is notified of the breach, the Assignee
may
enforce the Depositor’s obligation hereunder to purchase such Mortgage Loan from
the Assignee. Notwithstanding the foregoing, however, if such breach is a
Qualification Defect, such cure or repurchase must take place within 45 days
of
the discovery date of such defect.
Except
as
specifically set forth herein, the Depositor shall have no responsibility
to
enforce any provision of this Agreement, to oversee compliance hereof, or
to
take notice of any breach or default thereof.
7. Amendment
of the Sale and Servicing Agreements.
In
connection with the transfer of the Mortgage Loans hereunder, the Servicer
agrees that, from and after the date hereof, each Mortgage Loan transferred
hereunder will be subject to, and serviced under, the Sale and Servicing
Agreement under which the Mortgage Loans were originally transferred to the
Assignor. Notwithstanding anything to the contrary set forth herein, the
amended
provisions shall apply only to the Mortgage Loans transferred hereunder and
any
other mortgage loans subject to the Agreement shall continue to be serviced
under all of the existing provisions of the applicable Sale and Servicing
Agreement. For purposes of this Section 7, capitalized terms used herein shall
have the meanings assigned to such terms in the Sale and Servicing Agreement.
Each reference herein to “Agreement” shall be understood as a reference to the
Sale and Servicing Agreement and each reference to “Company” shall be understood
as a reference to the Servicer.
(a) Article
I
of the Sale and Servicing Agreement shall be amended as follows:
(i) by
adding
the following new definitions thereto, in alphabetical order:
“Guarantor:
With respect to the ___________ 200__ Reconstituted Mortgage Loans, [Xxxxxxx
Mac] [Xxxxxx
Xxx],
in its
capacity as guarantor of certain classes of securities issued in connection
with
the securitization of such
F-1-5
____________
200__ Reconstituted Mortgage Loans; provided that [Xxxxxxx
Mac]
[Xxxxxx
Xxx]
shall be
entitled to exercise any rights it may have under this Agreement with respect
to
the May 2004 Reconstituted Mortgage Loans in its capacity as Guarantor only
for
so long as no uncured default has occurred under its guarantee and either
(x)
any portion of the guaranteed securities remains outstanding or (y) amounts
are
otherwise owed to the Guarantor under the trust agreement pursuant to which
such
guaranteed securities were issued.”
“___________
200__ Securitization Transaction: A Securitization Transaction of certain
of the
Mortgage Loans by the Purchaser in connection with a securitization thereof
to
be effected on or about __________ __, 200__.”
“___________
200__ Reconstituted Mortgage Loans: The Mortgage Loans transferred pursuant
to
the ___________ 200__ Securitization Transaction and set forth on Exhibit
I of
the GSMC Assignment Agreement and this Agreement.”
(ii) by
amending the definition of “Business Day” by inserting the words “or the
Guarantor or the master servicer with respect to the __________ 200__
Securitization Transaction” immediately following the words “where the parties”
and immediately preceding the words “are
located. . . .”
(iii) by
deleting the definition of “Monthly Advance” in its entirety and replacing it
with the following: “With respect to each Remittance Date, advances of interest
and principal required to be made on the Business Day immediately preceding
such
Remittance Date to cover any shortfall between (i) Monthly Payments for each
Mortgage Loan and (ii) the amounts actually collected on account of such
Monthly
Payments for each such Mortgage Loan during the related Due
Period.”
(iv) by
deleting the definition of “Scheduled Principal Balance” in its entirety and
restating it as follows: “For any Mortgage Loan as of any Due Date subsequent to
the cut-off date for the ___________ 200__ Securitization Transaction up
to and
including, the date on which such Mortgage Loan is finally liquidated or
repurchased from the Trustee, the scheduled principal balance thereof as
of such
cut-off date, as reduced by (i) the principal portion of all Monthly Payments
due on or before such Due Date, to the extent actually paid by the related
Mortgagor or advanced by the Company, or the master servicer or trustee with
respect to the __________ 200__ Securitization Transaction, net of any portion
thereof that represents principal due on a Due Date occurring on or before
the
date on which such proceeds were received, and (ii) the principal portion
of all
Principal Prepayments, including Liquidation Proceeds, Condemnation Proceeds,
Insurance Proceeds and all payoffs received on or before the last day of
the
Principal Prepayment Period preceding the applicable date of
determination.”
(b) Section
2.02 of the Agreement shall be amended by replacing the first reference to
“the
Purchaser” in the third paragraph thereof with “the Purchaser or the Guarantor.”
F-1-6
Section
4.01 of the Agreement shall be amended by replacing the period at the end
of the
first paragraph thereof and adding the following: “;provided that in the event
the guidelines of FHA or VA conflict with the Servicing Guides of the Guarantor,
the Company shall service the loans in accordance with the guidelines of
FHA or
VA, as applicable”. The Company shall be required to reimburse the Purchaser for
any losses suffered as a result of a loss or reduction of FHA or VA coverage
due
to the failure of the Company to comply with the provisions of this Article
IV
not later than 60 days following receipt of notice from the Purchaser of
any
such loss.
(c) Section
4.04 of the Agreement shall be amended by changing each reference to “Mortgage
Loan” or Mortgage Loans” to “__________ 200__ Reconstituted Mortgage Loan” or
“____________ 200__ Reconstituted Mortgage Loans.”
(d) In
addition, clause (8) of Section 4.04 of the Agreement shall be amended by
adding
the words “without reimbursement” inside the parentheses immediately following
the words “out of its funds” and preceding the words “which, when added to all
amounts.”
(e) Section
4.10 of the Agreement shall be amended by replacing the words “Xxxxxx Mae or
FHLMC” in the first sentence of the first paragraph thereof with the words “the
Guarantor.”
(f) Section
4.20 of the Agreement shall be amended by adding the following sentence at
the
end thereof: “Upon request by the Guarantor, the Servicer shall provide evidence
of such accurate and complete information to the Guarantor as reasonably
requested and in a mutually agreed-upon format.”
(g) The
first
sentence of the second paragraph of Section 5.01 of the Agreement shall be
amended by adding the words “accrued from the Remittance Date to (and including)
the date on which such remittance is actually received by the Purchaser”
immediately following the words “interest on such late
payment. . . ” and preceding the words “at an annual rate equal
to. . . ”
(h) Section
5.03 of the Agreement shall be amended by removing the period at the end
of the
third sentence thereof and adding thereto the following clause:
“provided,
however,
that
following the __________ 200__ Securitization Transaction, the Guarantor,
in its
reasonable judgment, shall have the right to require the Company to remit,
from
its own funds, to the Custodial Account an amount equal to all advances
previously made with respect to the ___________ 200__ Reconstituted Mortgage
Loans out of funds held in the Custodial Account and not previously repaid
from
collections on the ___________ 200__ Reconstituted Mortgage Loans, and in
such
event, the Company shall thereafter remit all advances with respect to the
___________ 200__ Reconstituted Mortgage Loans from its own funds. In no
event
shall the preceding sentence be construed as limiting the Company’s right to (i)
pass through late collections on the Mortgages related to the ___________
200__
Reconstituted Mortgage Loans in lieu of making advances or (ii) reimburse
itself
for such advances from late collections on such Mortgages.”.”
F-1-7
(i) A
new
Section 5.04 shall be added to Article V immediately after existing Section
5.03
of the Agreement, which shall be entitled: “Penalties for Failure to Report
Timely and Accurately” and shall state the following:
“At
any
time following the ____________ 200__ Securitization Transaction, if the
Company
fails (A) to transmit the Monthly Remittance Advice to the entity acting
as the
master servicer with respect to such Securitization Transaction by the
Remittance Advice Date, or (B) to transmit the Monthly Remittance Advice
in a
materially accurate and complete manner, then:
(i) For
the
first such failure, the Company shall pay to the Master Servicer the amount
of
$500; provided,
however,
that
the Company shall not be required to make any such payment upon the first
such
failure during each successive two-year period following the closing date
for
the Securitization Transaction;
(ii) For
the
second such failure, the Company shall pay to the Master Servicer the amount
of
$750;
(iii) For
the
third such failure, the Company shall pay to the Master Servicer the amount
of
$1,000; and
(iv) For
the
fourth such failure, the Company shall pay to the Master Servicer the amount
of
$2,500.
The
payment for any such failure, as stated in (i) through (iv) above, shall
be paid
by the Company to the Master Servicer and the Master Servicer shall remit
such
payments to the Guarantor.”
(j) Section
6.06 of the Agreement shall be amended and restated in its entirety as
follows:
“The
Purchaser, or its designee, and, following the __________ 200__ Securitization
Transaction, the Guarantor, or its designee, shall have the right to examine
and
audit any and all of the books, records, or other information of the Company,
whether held by the Company or by another on its behalf, with respect to
or
concerning this Agreement or, in the case of the Purchaser, the Mortgage
Loans,
and, in the case of the Guarantor, the __________ 200__ Reconstituted Mortgage
Loans, during business hours or at such other times as may be reasonable
under
applicable circumstances, upon reasonable advance notice; provided, however,
in
the event the Purchaser or the Guarantor, as applicable, have a reasonable
good
faith belief that the books and records of the Company concerning this Agreement
or, in the case of the Purchaser, the Mortgage Loans and, in the case of
the
Guarantor, the ___________ 200__ Reconstituted Mortgage Loans, are not being
maintained in accordance with generally accepted accounting procedures or
Accepted Servicing Practices, the Purchaser and the Guarantor may request
additional opportunities to examine the Company’s books and records. Each of the
Purchaser and the Guarantor shall pay its own travel expenses associated
with
such examination.”
F-1-8
(k) Section
8.01 of the Agreement shall be amended by adding the words “(and if the Mortgage
Loans are securitized, Xxxxxxx Xxxxx & Co., GS Mortgage Securities Corp.,
________________________, in its capacity as trustee for the trust issuing
securities backed by the Mortgage Loans, and the entity, if any, acting in
the
capacity of a master servicer in connection with any securitization)”
immediately following the words “. . . indemnify the Purchaser”
and preceding the words “and hold it harmless . . .”
(l) Section
8.01 shall further be amended by adding the words “and the Guarantor”
immediately following the words “…indemnify the Purchaser” in the first
sentence.
(m) Section
8.02 of the Agreement shall be amended by adding the words “which shall be
acceptable to the Guarantor” immediately following the words “the successor or
surviving Person shall be an institution which is a Xxxxxx Mae, Xxxxxxx Mac,
HUD
and VA-approved company in good standing” and immediately preceding the words “.
Furthermore, in the event the Company. . . .”
(n) Section
8.04 of the Agreement shall be amended by adding the following language to
the
end of the first paragraph thereof: “Further, following the ____ 200_
Securitization Transaction, the Company may, upon thirty (30) days’ notice to
the Purchaser and the Guarantor, with the written consent of the Purchaser
and
the Guarantor, which consent shall not be unreasonably withheld or delayed
by
either such party and upon written confirmation that the ratings on any
securities backed by the Mortgage Loans will not be downgraded, qualified
or
withdrawn, transfer all or part of the administration and servicing of the
Mortgage Loans to any Person that is an institution approved to service loans
on
behalf of FHA and VA, has a net worth of not less than $25,000,000, and
satisfies the requirements of Section 12.01 with respect to the qualifications
of a successor to the Company. In any event, the Company shall pay all costs
associated with such transfer.”
(o) Section
8.04 shall further be amended by adding “and the Guarantor” immediately
following the words “…consent of the Purchaser” in the second sentence of the
first paragraph thereof.
(p) Section
8.04 shall further be amended by adding the words “and the Guarantor”
immediately following the words “…consent of the Purchaser” and preceding the
words “,then the Purchaser…” in the third paragraph thereof.
(q) Section
9.01 of the Agreement shall further be amended by (i) deleting “Purchaser” at
the end of clause (e) of and replacing it with “Xxxxxxx Xxxxx Mortgage Company
without the right of reimbursement,” (ii) deleting “Purchaser” in the second
sentence of clause f(iii) and replacing it “Xxxxxxx Sachs Mortgage Company,”
(iii) adding the words “without the right of reimbursement” at the end of the
second sentence of clause f(iii), and (iv) add “and the Guarantor” after the
first reference to the “Purchaser” in clause (g).
(r) Section
10.01 of the Agreement shall be amended by removing the period at the end
of
existing clause (ix) and replacing it with a semi-colon and the word “or” and
adding thereafter the following new clause:
F-1-9
“(x) the
failure of the Company to a maintain Tier I or Tier II rating from Xxxxxxx
Mac
for two consecutive Due Periods.”
(s) Section
10.01 shall be further amended by deleting the first sentence of the immediately
succeeding paragraph and replacing it with the following: “So long as any of the
foregoing Events of Default shall not have been remedied, in addition to
whatever rights the Purchaser may have at law or equity to damages, including
injunctive relief and specific performance, the Guarantor or the Purchaser
(with
the consent of the Guarantor), by notice in writing to the Company, may
terminate with cause all the rights and obligations of the Company under
this
Agreement and in and to the Mortgage Loans and the proceeds
thereof.”
(t) The
Purchaser must obtain the consent of the Guarantor to exercise it rights
or give
its consent under Sections 10.02, 11.01, 11.02, 11.03 and 12.02.
(u) Section
10.02 of the Agreement shall be amended by inserting the words “, with the
consent of the Guarantor,” immediately following the words “the Purchaser” and
preceding the words “may waive any default by the Company.”
(v) The
second sentence of the first paragraph of Section 11.02 of the Agreement
shall
be amended by deleting the words “the Company and any Rating Agency” and
replacing them with the words “the Company, any Rating Agency and the
Guarantor.”
(w) The
first
sentence of the second paragraph of Section 12.01 of the Agreement shall
be
amended by replacing the words “to the Company and to the Purchaser” with the
words “to the Company, the Purchaser and the Guarantor.”
(x) Section
12.01 shall be further amended by replacing the reference to “6.01” with “6.02”
in the first paragraph thereof.
(y) Notwithstanding
anything to the contrary set forth in Sections 4.16 and 6.01 of the Agreement,
it is understood and agreed that the Servicer shall determine, in accordance
with the servicing standard described in Section 4.01 of the Agreement, whether
or not to take the actions described in such Sections, and the consent of
the
Purchaser shall not be required therefor.
8. Continuing
Effect.
Except
as
contemplated hereby, the Sale and Servicing Agreement shall remain in full
force
and effect in accordance with their respective terms.
F-1-10
9. Governing
Law.
THIS
AGREEMENT AND THE RIGHTS AND OBLIGATIONS HEREUNDER SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD
TO THE CONFLICT OF LAWS PROVISIONS THEREOF).
EACH
PARTY HERETO HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY AND
ALL
RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED
ON, OR
ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT, OR ANY OTHER
DOCUMENTS AND INSTRUMENTS EXECUTED IN CONNECTION HEREWITH, OR ANY COURSE
OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN), OR ACTIONS
OF
SUCH PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES TO ENTER
INTO THIS AGREEMENT.
10. Notices.
Any
notices or other communications permitted or required hereunder or under
the
Sale and Servicing Agreement shall be in writing and shall be deemed
conclusively to have been given if personally delivered at or mailed by
registered mail, postage prepaid, and return receipt requested or transmitted
by
telex, telegraph or telecopier and confirmed by a similar mailed writing,
to:
(1) in
the
case of the Servicer,
Xxxxx
Fargo Bank, N.A.
1
Home
Campus, MAC X0000-000
Xxx
Xxxxxx, Xxxx 00000-0000
Attention:
Xxxx Xxxxx
Tel:
(000) 000-0000; Fax: (000) 000-0000
With
a
copy to:
Xxxxx
Fargo Bank, N.A.
1
Home
Campus, MAC #X2401-06T
Xxx
Xxxxxx, Xxxx 00000-0000
Attention:
General Counsel
Tel:
(000) 000-0000; Fax: (000) 000-0000
or
such
address as may hereafter be furnished by the Servicer;
or
such
address as may hereafter be furnished by the Servicer;
F-1-11
in
the
case of the Assignee,
[ ]
or
such
other address as may hereafter be furnished by the Assignee,
in
the
case of the Depositor,
[ ]
With
a
copy to:
[ ]
or
such
other address as may hereafter be furnished by the Depositor, and
in
the
case of the Master Servicer,
[ ]
or
such
other address as may hereafter be furnished by the Master Servicer.
11. Counterparts.
This
Agreement may be executed in counterparts, each of which when so executed
shall
be deemed to be an original and all of which when taken together shall
constitute one and the same instrument.
12. Definitions.
Any
capitalized term used but not defined in this Agreement has the meaning assigned
thereto in the Sale and Servicing Agreement.
F-1-12
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement the day
and
year first above written.
ASSIGNEE:
[ ]
|
By:
|
[
],
|
not
in
its individual capacity but solely as Trustee
By:
Name:
Title:
DEPOSITOR:
[
]
By:
Name:
Title:
Acknowledged
by:
SERVICER:
Xxxxx
Fargo Bank, N.A.
By:
Name:
Title:
MASTER
SERVICER:
[ ]
By:
Name:
Title:
F-1-13
EXHIBIT
1
Mortgage
Loan Schedule
F-1-14
EXHIBIT
2
Sale
and Servicing Agreement
F-1-15
EXHIBIT
F-2
FORM
OF ASSIGNMENT,
ASSUMPTION AND RECOGNITION AGREEMENT
ASSIGNMENT,
ASSUMPTION AND RECOGNITION AGREEMENT made this ___ day of ________, 200_
(this
“Agreement”), among Xxxxx Fargo Bank, N.A., as servicer (the “Servicer”),
_______________________, as assignee (the “Assignee”), and
_____________________, as assignor (the “Depositor”) and as acknowledged by
_______________________, as master servicer (the “Master
Servicer”).
WHEREAS,
Xxxxxxx Xxxxx Mortgage Company (the “Assignor”) and the Servicer have entered
the Master Seller’s Warranties and Servicing Agreement dated as of November 1,
2005 (the “Sale and Servicing Agreement”) pursuant to which the Servicer sold
certain mortgage loans listed on the mortgage loan schedule attached as an
exhibit to the Assignment and Conveyance Agreement;
WHEREAS,
the Assignor, the Depositor and the Servicer have entered into an Assignment,
Assumption and Recognition Agreement dated as of ________, 200_ (the “GSMC
Assignment Agreement”), pursuant to which the Assignor assigned its right title
and interest in and to the Mortgage Loans and the Sale and Servicing Agreement
to the Depositor;
WHEREAS,
the Assignee has agreed on certain terms and conditions to purchase from
the
Depositor certain mortgage loans (the “Mortgage Loans”), which Mortgage Loans
are subject to the provisions of the Sale and Servicing Agreement and are
listed
on the mortgage loan schedule attached as Exhibit
1
hereto
(the “Mortgage Loan Schedule”); and
WHEREAS,
pursuant to a Master Servicing and Trust Agreement, dated as of _______,
200_
(together with the _______ 200_ Edition of the Standard Terms thereto, the
“Trust Agreement”), among _______________________, as depositor, Xxxxxxx Sachs
Mortgage Company, as Assignor, _______________________, as master servicer
(the
“Master Servicer”), _______________________, as Trustee (the “Trustee”), and
_______________________, as custodian (the “Custodian”), the Depositor will
transfer the Mortgage Loans to the Trustee on behalf of the Assignee, together
with the Depositor’s rights in the Sale and Servicing Agreement.
NOW
THEREFORE, in consideration of the mutual promises contained herein and other
good and valuable consideration, the receipt and sufficiency of which are
hereby
acknowledged, the parties agree as follows:
1. Assignment
and Assumption.
(a)
The
Depositor hereby assigns to the Assignee, as of the date hereof, all of its
right, title and interest in and to the Mortgage Loans and the Sale and
Servicing Agreement, to the extent relating to the Mortgage Loans, and the
Assignee hereby assumes all of the Depositor’s obligations under the Sale and
Servicing Agreement, to the extent relating to the Mortgage Loans from and
after
________, 200_; the Servicer hereby acknowledges such assignment and assumption
and hereby agrees to the release of the Depositor from any obligations under
the
Sale and Servicing Agreement from and after _____, 200_, to the extent relating
to the Mortgage Loans.
F-2-1
(b)
The
Depositor represents and warrants to the Assignee that the Depositor has
not
taken any action which would serve to impair or encumber the Depositor’s
ownership interest in the Mortgage Loans since the date of the Sale and
Servicing Agreement.
(c)
The
Servicer and the Depositor shall have the right to amend, modify or terminate
the Sale and Servicing Agreement without the joinder of the Assignee with
respect to mortgage loans not conveyed to the Assignee hereunder; provided,
however,
that
such amendment, modification or termination shall not affect or be binding
on
the Assignee.
2. Accuracy
of Servicing Agreement.
The
Servicer and the Depositor represent and warrant to the Assignee that (i)
attached hereto as Exhibit
2
is a
true, accurate and complete copy of the Sale and Servicing Agreement, (ii)
the
Sale and Servicing Agreement is in full force and effect as of the date hereof,
(iii) the Sale and Servicing Agreement has not been amended or modified in
any
respect, other than by the amendments described in the recitals hereto and
appended to such Sale and Servicing Agreement and (iv) no notice of termination
has been given to the Servicer under the Sale and Servicing Agreement. The
Servicer, in its capacity as seller and/or servicer under the Sale and Servicing
Agreement, further represents and warrants that the representations and
warranties contained in Section 3.01 of the Sale and Servicing Agreement
are
true and correct as of the Closing Date (as defined in the Trust
Agreement).
3. Recognition
of Assignee; Recognition of Master Servicer.
(a) From
and
after the date hereof, the Servicer shall note the transfer of the Mortgage
Loans to the Assignee in its books and records, shall recognize the Assignee
as
the owner of the Mortgage Loans and shall, subject to clause (b) below, service
the Mortgage Loans for the benefit of the Assignee pursuant to the Sale and
Servicing Agreement, the terms of which are incorporated herein by reference.
It
is the intention of the Depositor, Servicer and the Assignee that the Sale
and
Servicing Agreement shall be binding upon and inure to the benefit of the
Servicer and the Assignee and their successors and assigns.
(b) The
Servicer further acknowledges that, from and after the date hereof, it (and
any
of its successors under the Sale and Servicing Agreement) will be subject
to the
supervision of the Master Servicer (except that the Master Servicer shall
not be
responsible for supervising the servicing of defaulted Mortgage Loans and
REO
Properties) and that the Master Servicer, acting on behalf of the Trustee
as the
owner of the Mortgage Loans, shall have the same rights as were assigned
by the
Assignor, in its capacity as the original purchaser under the Sale and Servicing
Agreement, to the Depositor under the GSMC Assignment Agreement, and further
assigned by the Depositor to the Trustee, on behalf of the Trust, hereunder.
Such rights will include, without limitation, the right to terminate the
Servicer under the Sale and Servicing Agreement upon the occurrence of an
event
of default thereunder, the right to receive all remittances required to be
made
by the Servicer under the Sale and Servicing Agreement, the right to receive
all
monthly reports and other data required to be delivered by the Servicer under
the Sale and Servicing Agreement, indemnification rights and the right to
exercise certain rights of consent and approval relating to actions taken
by the
Servicer.
F-2-2
(c) All
reports, notices and other written information required to be delivered to
the
Trustee, as the successor in interest to the Assignor and the Depositor under
the Sale and Servicing Agreement, shall also be delivered to the Master Servicer
at the address set forth in Section 10 hereof. All remittances required to
be
made to the Trustee, as the successor in interest to the Assignor and the
Depositor under the Sale and Servicing Agreement, shall be made instead to
the
Master Servicer by wire transfer to the following account:
_______________________
ABA#
[
]
For
credit to: SAS CLEARING
Account
Number: [
]
For
further credit to: _______________________ Collection Acct#
[
]
4. Representations
and Warranties of the Assignee. The Assignee hereby represents and warrants
as
follows:
(a) Decision
to Purchase.
The
Assignee represents and warrants that it is a sophisticated investor able
to
evaluate the risks and merits of the transactions contemplated hereby, and
that
it has not relied in connection therewith upon any statements or representations
of the Depositor or the Servicer other than those contained in the Sale and
Servicing Agreement or this Agreement.
(b) Authority.
The
Assignee hereto represents and warrants that it is duly and legally authorized
to enter into this Agreement and to perform its obligations hereunder and
under
the Sale and Servicing Agreement.
(c) Enforceability.
The
Assignee hereto represents and warrants that this Agreement has been duly
authorized, executed and delivered by it and (assuming due authorization,
execution and delivery thereof by each of the other parties hereto) constitutes
its legal, valid and binding obligation, enforceable in accordance with its
terms, except as such enforcement may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of creditors’
rights generally and by general equitable principles (regardless of whether
such
enforcement is considered in a proceeding in equity or at law).
5. Representations
and Warranties of the Depositor. The Depositor hereby represents and warrants
as
follows:
(a) Organization.
The
Depositor has been duly organized and is validly existing as a limited
partnership in good standing under the laws of the State of New York with
full
power and authority (corporate and other) to enter into and perform its
obligations under the Sale and Servicing Agreement and this Agreement.
(b) Enforceability.
This
Agreement has been duly executed and delivered by the Depositor, and, assuming
due authorization, execution and delivery by each of the other parties hereto,
constitutes a legal, valid, and binding agreement of the Depositor, enforceable
against it in accordance with its terms, subject to bankruptcy, insolvency,
reorganization, moratorium, or other similar laws affecting creditors’ rights
generally and to general principles of equity regardless of whether enforcement
is sought in a proceeding in equity or at law.
F-2-3
(c) No
Consent.
The
execution, delivery and performance by the Depositor of this Agreement and
the
consummation of the transactions contemplated thereby do not require the
consent
or approval of, the giving of notice to, the registration with, or the taking
of
any other action in respect of, any state, federal or other governmental
authority or agency, except such as has been obtained, given, effected or
taken
prior to the date hereof.
(d) Authorization;
No Breach.
The
execution and delivery of this Agreement have been duly authorized by all
necessary corporate action on the part of the Depositor; neither the execution
and delivery by the Depositor of this Agreement, nor the consummation by
the
Depositor of the transactions herein contemplated, nor compliance by the
Depositor with the provisions hereof, will conflict with or result in a breach
of, or constitute a default under, any of the provisions of the governing
documents of the Depositor or any law, governmental rule or regulation or
any
material judgment, decree or order binding on the Depositor or any of its
properties, or any of the provisions of any material indenture, mortgage,
deed
of trust, contract or other instrument to which the Depositor is a party
or by
which it is bound.
(e) Actions;
Procedures.
There
are no actions, suits or proceedings pending or, to the knowledge of the
Depositor, threatened, before or by any court, administrative agency, arbitrator
or governmental body (A) with respect to any of the transactions contemplated
by
this Agreement or (B) with respect to any other matter that in the judgment
of
the Depositor will be determined adversely to the Depositor and will if
determined adversely to the Depositor materially adversely affect its ability
to
perform its obligations under this Agreement.
(f) Prior
Assignments; Pledges.
Except
for the sale to the Assignee, the Depositor has not assigned or pledged any
Mortgage Note or the related Mortgage or any interest or participation
therein.
(g) Releases.
The
Depositor has not satisfied, canceled, or subordinated in whole or in part,
or
rescinded any Mortgage, and the Depositor has not released any Mortgaged
Property from the lien of the related Mortgage, in whole or in part, nor
has the
Depositor executed an instrument that would effect any such release,
cancellation, subordination, or rescission. The Depositor has not released
any
Mortgagor, in whole or in part, except in connection with an assumption
agreement or other agreement approved by the FHA, VA or RHS, as applicable,
to
the extent such approval was required.
It
is
understood and agreed that the representations and warranties set forth in
this
Section 5 shall survive delivery of the respective Mortgage Files to the
Custodian and shall inure to the benefit of the Assignee and its assigns
notwithstanding any restrictive or qualified endorsement or assignment. Upon
the
discovery by the Depositor, the Master Servicer or the Trustee of a breach
of
the foregoing representations and warranties, the party discovering such
breach
shall give prompt written notice thereof to the other parties to this Agreement,
and in no event later than two (2) Business Days from the date of such
discovery. It is understood and agreed that the obligations of the Depositor
set
forth in Section 6 to repurchase a Mortgage Loan constitute the sole remedies
available to the Assignee and its assigns on their behalf respecting a breach
of
the representations and warranties contained in this Section 5.
F-2-4
It
is
understood and agreed that the Depositor has made no representations or
warranties to the Assignee other than those contained in this Section 5,
and no
other affiliate of the Depositor has made any representations or warranties
of
any kind to the Assignee.
6. Repurchase
of Mortgage Loans.
Upon
discovery or notice of any breach by the Depositor of any representation,
warranty, or covenant under this Agreement that materially and adversely
affects
the value of any Mortgage Loan or the interest of the Assignee therein (it
being
understood that any such defect or breach shall be deemed to have materially
and
adversely affected the value of the related Mortgage Loan or the interest
of the
Assignee therein if the Assignee incurs a loss as a result of such defect
or
breach), the Assignee promptly shall request that the Depositor cure such
breach
and, if the Depositor does not cure such breach in all material respects
within
60 days from the date on which it is notified of the breach, the Assignee
may
enforce the Depositor’s obligation hereunder to purchase such Mortgage Loan from
the Assignee. Notwithstanding the foregoing, however, if such breach is a
Qualification Defect, such cure or repurchase must take place within 45 days
of
the discovery date of such defect.
Except
as
specifically set forth herein, the Depositor shall have no responsibility
to
enforce any provision of this Agreement, to oversee compliance hereof, or
to
take notice of any breach or default thereof.
7. Amendment
of the Sale and Servicing Agreement.
In
connection with the transfer of the Mortgage Loans hereunder, the Servicer
agrees that, from and after the date hereof, each Mortgage Loan transferred
hereunder will be subject to, and serviced under, the Sale and Servicing
Agreement under which the Mortgage Loans were originally transferred to the
Assignor. Notwithstanding anything to the contrary set forth herein, the
amended
provisions shall apply only to the Mortgage Loans transferred hereunder and
any
other mortgage loans subject to the Sale and Servicing Agreement shall continue
to be serviced under all of the existing provisions of the Sale and Servicing
Agreement. For purposes of this Section 7, capitalized terms used herein
shall
have the meanings assigned to such terms in the Sale and Servicing Agreement.
Each reference herein to “Agreement” shall be understood as a reference to the
Sale and Servicing Agreement and each reference to “Company” shall be understood
as a reference to the Servicer.
(a)
Article I of the Sale and Servicing Agreement, shall be amended as
follows:
(i) by
adding
the following new definitions thereto, in alphabetical order:
“FHA/VA/RHS
Claims Proceeds:
Either
(i) the amount of insurance proceeds received from the FHA under the FHA
insurance in the event of a default with respect to a Mortgage Loan insured
by
the FHA, (ii) the amount of proceeds received from the VA under the VA guaranty
in the event of a default with respect to a Mortgage Loan guaranteed by the
VA
or (iii) the amount of proceeds received from RHS under the RHS guaranty
in the
event of a default with respect to a Mortgage Loan guaranteed by
RHS.
F-2-5
“_____
200_ Securitization Transaction:
A
Securitization Transaction of certain of the Mortgage Loans by the Purchaser
in
connection with a securitization thereof to be effected on or about _______,
200_.
“________
200_ Reconstituted Mortgage Loans:
The
Mortgage Loans transferred pursuant to the _____ 200_ Securitization Transaction
and sent forth on Exhibit I of the GSMC Assignment Agreement and this
Agreement.
“Prime
Rate:
The
prime rate of United States money center commercial banks as published in
The
Wall Street Journal.”
(ii) by
amending the definition of “Business Day” by inserting the words “or the master
servicer with respect to the ______ 200_ Securitization Transaction” immediately
following the words “where the parties” and immediately preceding the words “are
located....”
(iii) by
deleting the definition of “Monthly Advance” in its entirety and replacing it
with the following: “With respect to each Remittance Date, advances of interest
and principal required to be made on the Business Day immediately preceding
such
Remittance Date to cover any shortfall between (i) Monthly Payments for each
Mortgage Loan and (ii) the amounts actually collected on account of such
Monthly
Payments for each such Mortgage Loan during the related Due
Period.”
(iv) by
deleting the definition of “Scheduled Principal Balance” in its entirety and
restating it as follows: “For any Mortgage Loan as of any Due Date subsequent to
the cut-off date for the ______ 200_ Securitization Transaction up to and
including, the date on which such Mortgage Loan is finally liquidated or
repurchased from the Trustee, the scheduled principal balance thereof as
of such
cut-off date, as reduced by (i) the principal portion of all Monthly Payments
due on or before such Due Date, to the extent actually paid by the related
Mortgagor or advanced by the Company, or the master servicer or trustee with
respect to the ______ 200_ Securitization Transaction, net of any portion
thereof that represents principal due on a Due Date occurring on or before
the
date on which such proceeds were received, and (ii) the principal portion
of all
Principal Prepayments, including Liquidation Proceeds, Condemnation Proceeds,
Insurance Proceeds and all payoffs received on or before the last day of
the
Principal Prepayment Period preceding the applicable date of
determination.”
(b)
Section 4.01 shall be amended by adding the following as a new paragraph
at the
end thereof: “For the avoidance of doubt and without regard to references herein
to any servicing guidelines, all ______ 200_ Reconstituted Mortgage Loans
that
are (i) insured by FHA shall be serviced in accordance with FHA guidelines,
(ii)
guaranteed by VA shall be serviced in accordance with VA guidelines and (iii)
guaranteed by RHS shall be serviced in accordance with RHS guidelines. The
Company shall be required to reimburse the Purchaser for any losses suffered
due
to loss of FHA, VA or RHS coverage as a result of a failure by the Company
to
comply with the provisions of this Article IV not later than 60 days following
receipt of notice from the Purchaser of any such loss.”
F-2-6
(c)
Section 4.04 of the Sale and Servicing Agreement shall be amended by changing
each reference to “Mortgage Loan” or Mortgage Loans” to “______ 200_
Reconstituted Mortgage Loan” or “______ 200_ Reconstituted Mortgage
Loans.”
(d)
In
addition, clause (8) of Section 4.04 of the Sale and Servicing Agreement
shall
be amended by adding the words “without reimbursement” inside the parentheses
immediately following the words “out of its funds” and preceding the words
“which, when added to all amounts.”
(e)
The
first sentence of the second paragraph of Section 5.01 of the Sale and Servicing
Agreement shall be amended by adding the words “accrued from the Remittance Date
to (and including) the date on which such remittance is actually received
by the
Purchaser” immediately following the words “interest on such late
payment. . . ” and preceding the words “at an annual rate equal
to. . . ”
(f)
Section 5.03 of the Sale and Servicing Agreement shall be further amended
by
inserting the words “Subject to the provisions of Section 4.02,” at the
beginning of the fourth sentence therefor which begins with the words “[T]he
Company’s obligation to make such Monthly
Advances. . . .”
(g)
Section 8.01 of the Sale and Servicing Agreement shall be amended by adding
the
words “(and if the Mortgage Loans are securitized, Xxxxxxx Xxxxx & Co., GS
Mortgage Securities Corp., ________________, in its capacity as trustee for
the
trust issuing securities backed by the Mortgage Loans, and the entity, if
any,
acting in the capacity of a master servicer in connection with any
securitization)” immediately following the words “. . . indemnify the Purchaser”
and preceding the words “and hold it harmless . . .”
(h) Section
8.02 of the Sale and Servicing Agreement shall be amended by deleting in
the
second paragraph thereof the reference to “Xxxxxx Mae, Xxxxxxx Mac, HUD and
VA-approved company in good standing” and replacing it with “FHA, VA, RHS,
Xxxxxx Mae and Xxxxxxx Mac -approved company in good standing.”
(i) Section
8.04 of the Sale and Servicing Agreement shall be amended by adding the
following language to the end of the above referenced section: “Notwithstanding
anything in this Agreement to the contrary, the Company may, upon thirty
(30)
days’ notice to the Purchaser, with the written consent of the Purchaser, which
consent shall not be unreasonably withheld or delayed by such party and upon
written confirmation that the ratings on any securities backed by the Mortgage
Loans will not be downgraded, qualified or withdrawn, transfer all or part
of
the administration and servicing of the Mortgage Loans to any Person that
is an
institution approved to service loans on behalf of FHA, VA and RHS, has a
net
worth of not less than $25,000,000, and satisfies the requirements of Section
12.01 with respect to the qualifications of a successor to the
Company.”
F-2-7
(j)
Notwithstanding anything to the contrary set forth in Sections 4.16 and 6.01
of
the Sale and Servicing Agreement, it is understood and agreed that the Company
shall determine, in accordance with the servicing standard described in Section
4.01 of the Sale and Servicing Agreement, whether or not to take the actions
described in such Sections, and the consent of the Purchaser shall not be
required therefor.
8. Continuing
Effect.
Except
as
contemplated hereby, the Sale and Servicing Agreement shall remain in full
force
and effect in accordance with their respective terms.
9. Governing
Law.
THIS
AGREEMENT AND THE RIGHTS AND OBLIGATIONS HEREUNDER SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD
TO THE CONFLICT OF LAWS PROVISIONS THEREOF).
EACH
PARTY HERETO HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY AND
ALL
RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED
ON, OR
ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT, OR ANY OTHER
DOCUMENTS AND INSTRUMENTS EXECUTED IN CONNECTION HEREWITH, OR ANY COURSE
OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN), OR ACTIONS
OF
SUCH PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES TO ENTER
INTO THIS AGREEMENT.
10. Notices.
Any
notices or other communications permitted or required hereunder or under
the
Sale and Servicing Agreement shall be in writing and shall be deemed
conclusively to have been given if personally delivered at or mailed by
registered mail, postage prepaid, and return receipt requested or transmitted
by
telex, telegraph or telecopier and confirmed by a similar mailed writing,
to:
Section
12.12 in
the
case of the Servicer,
Xxxxx
Fargo Bank, N.A.
1
Home
Campus, MAC #X2401-042
Xxx
Xxxxxx, Xxxx 00000-0000
Attention:
Xxxx Xxxxx
Tel:
(000) 000-0000
Fax:
(000) 000-0000
With
a
copy to:
F-2-8
Xxxxx
Fargo Bank, N.A.
1
Home
Campus, MAC #X2401-06T
Xxx
Xxxxxx, Xxxx 00000-0000
Attention:
General Counsel
Tel:
(000) 000-0000
Fax:
(000) 000-0000
or
such
address as may hereafter be furnished by the Servicer;
(b) in
the
case of the Assignee,
[
]
or
such
other address as may hereafter be furnished by the Assignee,
(c) in
the
case of the Depositor,
[ ]
With
a
copy to:
[
]
or
such
other address as may hereafter be furnished by the Depositor, and
(d) in
the
case of the Master Servicer,
[
]
or
such
other address as may hereafter be furnished by the Master Servicer.
11. Counterparts.
This
Agreement
may be executed in counterparts, each of which when so executed shall be
deemed
to be an original and all of which when taken together shall constitute one
and
the same instrument.
12. Definitions.
Any
capitalized term used but not defined in this Agreement has the meaning assigned
thereto in the Sale and Servicing Agreement.
F-2-9
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement the day
and
year first above written.
ASSIGNEE:
[
]
|
By:
|
[ ],
|
not
in
its individual capacity but solely as Trustee
By:
Name:
Title:
DEPOSITOR:
[ ]
By:
Name:
Title:
Acknowledged
by:
SERVICER:
Xxxxx
Fargo Bank, N.A.
By:
Name:
Title:
MASTER
SERVICER:
[ ]
By:
Name:
Title:
F-2-10
EXHIBIT
1
Mortgage
Loan Schedule
F-2-11
EXHIBIT
2
Sale
and Servicing Agreement
F-2-12
EXHIBIT
G
FORM
OF SELLER’S OFFICER’S CERTIFICATE
I,
______________________, hereby certify that I am a duly elected [Vice President]
of Xxxxx Fargo Bank, N.A., a national banking association organized under
the
laws of the United States (the “Company”) and further as follows:
1. Attached
hereto as Exhibit A is a true, correct and complete copy of the articles
of
association of the Company which are in full force and effect on the date
hereof.
2. Attached
hereto as Exhibit B is a true, correct and complete copy of the by-laws of
the
Company which are in effect on the date hereof.
3. The
execution and delivery by the Company of the Amended and Restated Master
Seller’s Warranties and Servicing Agreement, dated as of March 1, 2006 (the
“Sale and Servicing Agreement”) and the Custodial Agreement, dated as of October
1, 2004 (the “Custodial Agreement” and, together with the Sale and Servicing
Agreement, the “Agreements”) are in the ordinary course of business of the
Company.
4. A
true
and correct copy of the resolutions of the Mortgage Banking Committee of
the
Board of Directors of the Company authorizing the Company to enter into the
Agreements is attached hereto as Exhibit C.
5. Each
person who, as an officer or representative of the Company, signed (a) the
Sale and Servicing Agreement, or (b) any other document delivered prior
hereto or on the date hereof in connection with any transaction described
in the
Agreements was, at the respective times of such signing and delivery a duly
elected or appointed, qualified and acting officer or representative of the
Company and the signatures of such persons appearing on such documents are
their
genuine signatures.
No
proceedings for dissolution, merger, consolidation, liquidation, conservatorship
or receivership of the Company or for the sale of all or substantially all
of
its assets is pending, or to my knowledge threatened, and no such proceeding
is
contemplated by the Company.
G-1
IN
WITNESS WHEREOF, I have hereunto signed my name and affixed the seal of the
Company.
Dated:
By:
Title:
Vice President
I,
__________________ the Secretary of Xxxxx Fargo Bank, N.A., hereby certify
that
_______________________ is a duly elected and acting Vice President of the
Company and that the signature appearing above is his genuine
signature.
IN
WITNESS WHEREOF, I have hereunto signed my name.
Dated: By:
Title:
Secretary
G-2
EXHIBIT
H
PROCESS
GUIDELINES
1. Contract
The
Purchaser must provide the Company with an Assignment & Assumption Agreement
or similar notice with respect to a transfer to Xxxxxx Mae no less than five
(5)
Business Days prior to the last Business Day of the month of transfer. Such
document will confirm that the Mortgage Loans will be serviced in accordance
with the Xxxxxx Xxx Servicing Guide. Such document must also confirm that
Mortgage Loans were sold to Xxxxxx Mae under the special servicing
option.
2. Requirements
for Xxxxxx Xxx sales
|
(a)
|
Unless
approved by the Company, Mortgage Loans must be delivered to Xxxxxx
Mae
under an arrangement pursuant to which the Purchaser provides “Recourse
(type 1)” to Xxxxxx Xxx, as defined under the Xxxxxx Mae Seller/Servicer
Guide.
|
|
(b)
|
The
Servicing Fee less the Xxxxxx Xxx guaranty fee ( the “ Net Servicing Fee”)
under the Xxxxxx Mae sale must be equal to or greater than the
current
Servicing Fee being paid to the Company by the Purchaser. Should
the Net
Servicing Fee exceed the current Servicing Fee, any excess will
be
retained by the Company.
|
|
(c)
|
Preparation
and recording of any Assignments of Mortgage with respect to the
Mortgage
Loans, other than as required by the underlying Master Seller’s Warranties
and Servicing Agreement, will be the responsibility of the
Purchaser.
|
|
(d)
|
Information
required to transfer the loans into Xxxxxx Xxx must be received
no less
than five (5) Business Days prior to the last Business Day of the
transaction month.
|
|
(e)
|
Information
to transfer the loans must be in an Excel file format with the
following
data fields:
|
(i) servicer
number; (ii) Xxxxx Fargo loan number; (iii) balance sold to Xxxxxx Xxx;
(iv) Pass-through rate; (v) interest rate; (vi) interest rate
net of the servicing fee rate and guarantee fee rate; (vii) Xxxxxx Mae loan
number; (viii) contract or pool number; (ix) if the transaction is an
“actual/actual” sale - contract number; and (x) if the transaction is an
“actual/actual” sale - date of first payment to Xxxxxx Xxx.
|
(f)
|
Balances
must be verified with the Company before the Mortgage Loan(s) are
sold to
Xxxxxx Mae.
|
|
(g)
|
The
servicer number used to deliver the Mortgage Loan(s) to Xxxxxx
Xxx must be
approved by the Company before the Mortgage Loan(s) are sold. The
Company
will assess a $500 correction penalty for each pool sold under
a different
seller/servicer number than what was
provided.
|
H-1
|
(h)
|
Final
purchase advices and/or the 2005 forms must be received by the
Company
prior to the last Business Day of the transaction
month.
|
|
(i)
|
The
Purchaser must provide name and contact information of individual
authorized to discuss the sale terms. Investor name and broker
names need
to be provided to the Company.
|
3. Fees
A
one-time set-up fee of $5,000 will be charged to the Purchaser for subsequent
sales of Mortgage Loans to Xxxxxx Mae for which recourse is maintained by
the
Purchaser. Should the Purchaser sell loans to Xxxxxxx Mac (standard, not
REMIC)
an additional setup fee may be charged. The Company will establish one investor
number on each of the Company’s related Fidelity clients for those Mortgage
Loans sold by the Purchaser to Xxxxxx Mae without recourse.
4. Process
Guidelines
|
(a)
|
Monthly
reporting to the Purchaser on the status of recourse loans will
be limited
to existing Fidelity delinquency and trial balance reports. Reports
will
be as of each month-end and will be provided to the Purchaser no
later
than the twenty (20) days following the related month-end. The
Purchaser
will provide contact information for monthly reporting, repurchase
funding
and claim settlement processes.
|
|
(b)
|
For
any Mortgage Loans required to be repurchased by the Purchaser
from Xxxxxx
Xxx due to mortgagor credit defaults (rather than administrative,
legal or
documentation issues), the Company will notify the Purchaser of
the total
amount due to Xxxxxx Mae for the Mortgage Loan to be repurchased
no later
than the 3rd Business Day prior to the end of the month of repurchase.
The
Purchaser will remit same amount, plus a $100 repurchase processing
fee to
the Company no later than the last Business Day of the repurchase
month. A
late remittance penalty of prime + 2% will be assessed from the
date such
remittance was due through the date such remittance was actually
made.
|
|
(c)
|
Wiring
instructions for repurchases by the
Purchaser:
|
Xxxxx
Fargo Bank Iowa N.A.
Des
Moines IA
ABA
000000000
Account
Number: 0000000
Account
Name: Service Holding
ATTN:
Xxxx Xxxxxxxxxxxx, Goldman/Xxxxxx Xxx
Telephone:
000-000-0000
H-2
|
(d)
|
An
additional investor number will be established for Mortgage Loans
repurchased by the Purchaser. Such investor number will be actual/actual
remittance with month-end cutoff. Reports and remittances will
be due on
the tenth calendar day of each
month.
|
H-3
EXHIBIT
I
FORM
OF XXXXXXX MAC AMENDMENT
I-1
EXHIBIT
J
FORM
OF XXXXXX XXX ASSIGNMENT,
ASSUMPTION
AND RECOGNITION AGREEMENT
[To
be
determined at time of Xxxxxx Mae transfer.]
J-1
EXHIBIT
K
FORM
OF ASSIGNMENT AND CONVEYANCE AGREEMENT
On
this
___ day of __________, ____, for good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, Xxxxx Fargo Bank, N.A.
(“Company”),
as
(i) the Seller under that certain Commitment Letter, dated as of
___________, _____ (the “Commitment
Letter”),
(ii)
the Company under that certain Amended and Restated Master Seller’s Warranties
and Servicing Agreement, dated as of March 1, 2006 (the “Purchase
Agreement”
and,
together with the Commitment Letter, the “Agreements”)
does
hereby sell, transfer, assign, set over and convey to Xxxxxxx Sachs Mortgage
Company (“Purchaser”)
as the
Purchaser under the Agreements, and the Purchaser hereby accepts from the
Company, without recourse, but subject to the terms of the Agreements, all
right, title and interest of, in and to the Mortgage Loans listed on the
Mortgage Loan Schedule attached hereto as Exhibit A
(the
“Mortgage
Loans”).
Pursuant to Section 2.03 of the Purchase Agreement, the Company has delivered
the Mortgage Loan Documents to the Custodian. The Mortgage File and the
Servicing File for each Mortgage Loan shall be retained by the Company pursuant
to Section 2.01 of the Purchase Agreement.
In
accordance with Article II
of the
Purchase Agreement, the Purchaser accepts the Mortgage Loans listed on
Exhibit A
attached
hereto. Notwithstanding the foregoing the Purchaser does not waive any rights
or
remedies it may have under the Agreements.
Capitalized
terms used herein and not otherwise defined shall have the meanings set forth
in
the Purchase Agreement.
[SIGNATURE
PAGE FOLLOWS]
K-1
XXXXX
FARGO BANK, N.A.
By:_________________________________
Name:______________________________
Title:_______________________________
Accepted
and Agreed:
XXXXXXX
SACHS MORTGAGE COMPANY
By:
Xxxxxxx Xxxxx Real Estate
Funding
Corp., its General Partner
By:
Name:______________________________
Title:
K-2
EXHIBIT
L
FORM
OF INDEMNIFICATION AGREEMENT
THIS
INDEMNIFICATION AGREEMENT dated [_______], 200___ (the “Agreement”),
between GS Mortgage Securities Corp., a Delaware corporation (the “Depositor”),
Xxxxxxx Sachs Mortgage Company, a New York limited partnership (“GSMC”), and
Xxxxx Fargo Bank, N.A., a national banking association ( “Xxxxx
Fargo”).
WITNESSETH:
WHEREAS,
Xxxxx Fargo, GSMC and the Depositor are parties to the Assignment, Assumption
and Recognition Agreement dated as of _____, 20___ (the “Assignment
Agreement”);
WHEREAS,
GSMC will sell certain Mortgage Loans to the Depositor pursuant to the
Assignment Agreement and such Mortgage Loans are and will continue to be
serviced by Xxxxx Fargo pursuant to the Servicing Agreement (as defined herein);
and
WHEREAS,
as an inducement to the Depositor to enter into the Assignment Agreement,
to the
Underwriter[s] to enter into the Underwriting Agreement (as defined herein),
and
to the Initial Purchaser[s] to enter into the Certificate Purchase Agreement
(as
defined herein), the parties hereto wish to provide for indemnification and
contribution on the terms and conditions hereinafter set forth;
NOW,
THEREFORE, in consideration of the foregoing and of other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the
parties hereto agree as follows:
ARTICLE
I DEFINITIONS
Section
1.01 Certain
Defined Terms. The following terms shall have the meanings set forth below,
unless the context clearly indicates otherwise:
1933
Act:
The
Securities Act of 1933, as amended.
1934
Act:
The
Securities Exchange Act of 1934, as amended.
Agreement:
This
Indemnification Agreement, as the same may be amended in accordance with
the
terms hereof.
Certificate
Purchase Agreement:
The
Purchase Agreement, dated as of [______], 200___, [among] the Depositor and
the
Initial Purchaser[s] relating to the Privately Offered
Certificates.
Initial
Purchaser:
Xxxxxxx, Xxxxx & Co., a New York limited partnership, and its successors and
assigns.
Offering
Circular: The
offering circular, dated [_______], 200___, relating to the private offering
of
the Privately Offered Certificates.
Person:
Any
individual, corporation, limited liability company, partnership, joint venture,
association, joint stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
Privately
Offered Certificates: [__________________],
issued pursuant to the Pooling and Servicing Agreement.
Prospectus
Supplement:
The
prospectus supplement, dated [______], 200___, relating to the public
offering of the Publicly Offered Certificates.
Publicly
Offered Certificates:
[______________________________], issued pursuant to the Pooling and Servicing
Agreement.
Servicing
Agreement:
The
Amended and Restated Master Seller’s Warranties and Servicing Agreement, dated
as of March 1, 2006, between Xxxxx Fargo Bank, N.A. and GSMC.
Underwriters:
Xxxxxxx, Xxxxx & Co., a New York limited partnership[, and [____________], a
[___________] corporation], and their successors and assigns.
Underwriting
Agreement:
The
Underwriting Agreement, dated as of [________], 200__, [among] the Depositor
and
the Underwriter[s], relating to the Publicly Offered Certificates.
Xxxxx
Fargo Information:
All
information in the Prospectus Supplement contained under the headings [“The
Mortgage Loan Pool—Underwriting Guidelines” and “The Servicers—Xxxxx Fargo Bank,
N.A. (including the table immediately following the second paragraph
therof)].
Section
1.02 Other
Terms. Capitalized terms used but not defined herein shall have the meanings
assigned to such terms in the Pooling and Servicing Agreement.
ARTICLE
II REPRESENTATIONS AND WARRANTIES
Each
party hereto represents and warrants that:
(a) it
has
all requisite organizational power and authority to execute, deliver and
perform
its obligations under this Agreement;
(b) this
Agreement has been duly authorized, executed and delivered by such party;
and
(c) assuming
the due authorization, execution and delivery by each other party hereto,
this
Agreement constitutes the legal, valid and binding obligation of such
party.
ARTICLE
III INDEMNIFICATION
Section
3.01 Indemnification
by Xxxxx Fargo.
(a) Xxxxx
Fargo shall indemnify and hold harmless the Depositor, GSMC, [each of] the
Underwriter[s], the Initial Purchaser[s], their respective affiliates and
their
respective directors, officers, partners and each Person, if any, that controls
the Depositor, GSMC, such Underwriter or the Initial Purchaser, or such
affiliate, within the meaning of either the 1933 Act or the 1934 Act
(collectively, the “GS Indemnified Parties”) against any and all losses, claims,
damages, penalties, fines, forfeitures, reasonable and necessary legal fees
and
related costs, judgments, and any other costs, fees and expenses to which
each
such GS Indemnified Party may become subject, under the 1933 Act, the 1934
Act
or otherwise, to the extent that such losses, claims, damages, penalties,
fines,
forfeitures, fees, costs, judgments or expenses arise out of or are based
upon
(1) any untrue statement or alleged untrue statement of any material fact
contained in the Prospectus Supplement or any amendment or supplement thereto
(provided that such Xxxxx Fargo Information in such amendment or supplement
was
approved by Xxxxx Fargo), or arise out of or are based upon (2) the omission
or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances
in
which they were made, not misleading; provided, by
way of clarification,
that
clause (2) of this paragraph shall be construed solely by reference to the
Xxxxx
Fargo Information and not to any other information communicated in connection
with the Certificates, without regard to whether the Xxxxx Fargo Information
or
any portion thereof is presented together with or separately from such other
information. Xxxxx Fargo shall in each case reimburse each GS Indemnified
Party
for any legal or other expenses reasonably incurred by such GS Indemnified
Party
in connection with investigating or defending any such loss, claim, damage,
liability, penalty, fine, forfeiture, or action. Xxxxx Fargo’s liability under
this Section 3.01(a) shall be in addition to any other liability that Xxxxx
Fargo may otherwise have.
(b) GSMC
shall indemnify and hold harmless Xxxxx Fargo, its affiliates and its respective
directors, officers, partners and each Person, if any, that controls Xxxxx
Fargo
or such affiliate, within the meaning of either the 1933 Act or the 1934
Act
(collectively, the “Xxxxx Fargo Indemnified Parties”), against any and all
losses, claims, damages, penalties, fines, forfeitures, reasonable and necessary
legal fees and related costs, judgments, and any other costs, fees and expenses
to which each such Xxxxx Fargo Indemnified Party may become subject, under
the
1933 Act, the 1934 Act or otherwise, to the extent that such losses, claims,
damages, penalties, fines, forfeitures, fees, costs, judgments or expenses
arise
out of or are based upon any untrue statement or alleged untrue statement
of any
material fact contained in the Prospectus Supplement, registration statement,
prospectus, any private placement memorandum or offering circular, any any
computational materials, or any amendment or supplement thereto, or arise
out of
or are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances in which they were made, not misleading, to
the
extent that such untrue statement or alleged untrue statement or omission
or
alleged omission relates to information other than that set forth in the
Xxxxx
Fargo Information, and GSMC shall in each case reimburse such Xxxxx Fargo
Indemnified Party for any legal or other expenses reasonably incurred by
such
Xxxxx Fargo Indemnified Party, in connection with investigating or defending
any
such loss, claim, damage, liability, penalty, fine, forfeiture, or action.
GSMC’s liability under this Section 3.01(b) shall be in addition to any other
liability that GSMC may otherwise have.
(c) If
the
indemnification provided for in this Section 3.01 shall for any reason be
unavailable to an indemnified party under this Section 3.01, then the party
which would otherwise be obligated to indemnify with respect thereto, on
the one
hand, and the parties which would otherwise be entitled to be indemnified,
on
the other hand, shall contribute to the losses claims, damages, penalties,
fines, forfeitures, costs, fees, judgments and expenses of the nature
contemplated herein and incurred by the parties hereto in such proportions
that
are appropriate to reflect the relative fault of the Depositor, GSMC, the
Underwriter[s], and the Initial Purchaser[s], on one hand, and Xxxxx Fargo,
on
the other hand, in connection with the applicable misstatements or omissions
or
alleged misstatements or omissions as well as any other relevant equitable
considerations. Notwithstanding the foregoing, no Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 0000 Xxx) with
respect to the misstatement or omission or alleged misstatement or omission
at
issue shall be entitled to contribution from any Person that was not guilty
of
such fraudulent misrepresentation with respect to the misstatement or omission
or alleged misstatement or omission at issue.
Section
3.02 Notification;
Procedural Matters. Promptly after receipt by an indemnified party under
Section
3.01 of notice of any claim or the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against any
indemnifying party under Section 3.01, notify the indemnifying party (or
other
contributing party) in writing of the claim or the commencement of such action;
provided, however, that the failure to notify the indemnifying party (or
other
contributing party) shall not relieve it from any liability which it may
have
under Section 3.01 except to the extent it has been materially prejudiced
by
such failure; and provided further, however, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have
to
any indemnified party otherwise than under Section 3.01. In case any such
action
is brought against any indemnified party and it notifies the indemnifying
party
of the commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that, by written notice delivered
to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, the indemnifying party elects to assume the defense thereof,
it may participate with counsel reasonably satisfactory to such indemnified
party; provided, however, that if the defendants in any such action include
both
the indemnified party and the indemnifying party and the indemnified party
or
parties shall reasonably have concluded that there may be legal defenses
available to it or them and/or other indemnified parties that are different
from
or additional to those available to the indemnifying party, the indemnified
party or parties shall have the right to select separate counsel to assert
such
legal defenses and to otherwise participate in the defense of such action
on
behalf of such indemnified party or parties. Upon receipt of notice from
the
indemnifying party to such indemnified party of its election so to assume
the
defense of such action and approval by the indemnified party of such counsel,
the indemnifying party shall not be liable to such indemnified party under
this
paragraph for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof, unless (i) the
indemnified party shall have employed separate counsel (plus any local counsel)
in connection with the assertion of legal defenses in accordance with the
proviso to the immediately preceding sentence, (ii) the indemnifying party
shall
not have employed counsel reasonably satisfactory to the indemnified party
to
represent the indemnified party within a reasonable time after notice of
commencement of the action or (iii) the indemnifying party shall have authorized
the employment of counsel for the indemnified party at the expense of the
indemnifying party. No party shall be liable for contribution with respect
to
any action or claim settled without its consent, which consent shall not
be
unreasonably withheld. In no event shall the indemnifying party be liable
for
the fees and expenses of more than one counsel representing the indemnified
parties (in addition to any local counsel) separate from its own counsel
for all
indemnified parties in connection with any one action or separate but similar
or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances.
ARTICLE
IV GENERAL
Section
4.01 Survival.
This Agreement and the obligations of the parties hereunder shall survive
the
purchase and sale of the Publicly Offered Certificates and the Privately
Offered
Certificates.
Section
4.02 Successors.
This Agreement shall inure to the benefit of and be binding upon the parties
hereto, each indemnified party and their respective successors and assigns,
and
no other Person shall have any right or obligation hereunder.
Section
4.03 Applicable
Law. This Agreement shall be governed by and construed in accordance with
the
laws of the State of New York without giving effect to principles of conflict
of
laws.
Section
4.04 Neither
this Agreement nor any term hereof may be changed, waived, discharged or
terminated except by a writing signed by the party against which enforcement
of
such change, waiver, discharge or termination is sought. This Agreement may
be
signed in any number of counterparts, each of which shall be deemed an original,
which taken together shall constitute one and the same instrument.
Section
4.05 Notices.
All communications hereunder shall be in writing and shall be deemed to have
been duly given when delivered to (a) in the case of the Depositor, GSMC,
the
Underwriter[s], or the Initial Purchaser[s], GS Mortgage Securities Corp.,
Xxxxxxx Xxxxx Mortgage Company or Xxxxxxx, Sachs & Co. c/o Goldman, Xxxxx
& Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Structured
Products Group/Xxxxxxxxxxx X. Xxxxxxx, and (b) in the case of Xxxxx Fargo:
Xxxxx
Xxxxx Xxxx, X.X., 0 Xxxx Xxxxxx, Xxx Xxxxxx, XX, 00000-0000, Attention: General
Counsel, MAC X2401-06T.
Section
4.06 Submission
To Jurisdiction; Waivers.
Each
of
the parties hereto hereby irrevocably and unconditionally:
(A) SUBMITS
FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO
THIS
AGREEMENT, OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT
THEREOF, TO THE NON-EXCLUSIVE GENERAL JURISDICTION OF THE COURTS OF THE STATE
OF
NEW YORK, THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND APPELLATE COURTS FROM ANY THEREOF;
(B) CONSENTS
THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN SUCH COURTS AND, TO
THE
EXTENT PERMITTED BY LAW, WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER
HAVE
TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH
ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT
TO
PLEAD OR CLAIM THE SAME;
(C) AGREES
THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR PROCEEDING MAY BE EFFECTED
BY
MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO ITS ADDRESS SET FORTH HEREIN OR
AT
SUCH OTHER ADDRESS OF WHICH THE OTHER PARTIES HERETO SHALL HAVE BEEN NOTIFIED;
AND
(D) AGREES
THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN
ANY
OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO XXX IN ANY OTHER
JURISDICTION.
[SIGNATURE
PAGE FOLLOWS]
IN
WITNESS WHEREOF, the parties have executed this Agreement by their duly
authorized officers as of the date first above written.
GS
MORTGAGE SECURITIES CORP.
By:
Name:
Title:
XXXXXXX
SACHS MORTGAGE COMPANY, A NEW YORK LIMITED PARTNERSHIP
By:
Xxxxxxx Xxxxx Real Estate Funding Corp., its general partner
By:
Name:
Title
XXXXX
FARGO BANK, N.A.
By:
Name:
Title:
EXHIBIT
M
SERVICING
CRITERIA TO BE ADDRESSED
IN
ASSESSMENT OF COMPLIANCE
The
assessment of compliance to be delivered by [the Company][Name of Subservicer]
shall address, as a minimum, the criteria identified below as “Applicable
Servicing Criteria”
|
Reg
AB Reference
|
Servicing
Criteria
|
Applicable
Servicing Criteria
|
Inapplicable
Servicing Criteria
|
|
General
Servicing Considerations
|
|||
|
1122(d)(1)(i)
|
Policies
and procedures are instituted to monitor any performance or other
triggers
and events of default in accordance with the transaction
agreements.
|
X
|
|
|
1122(d)(1)(ii)
|
If
any material servicing activities are outsourced to third parties,
policies and procedures are instituted to monitor the third party’s
performance and compliance with such servicing activities.
|
X
|
|
|
1122(d)(1)(iii)
|
Any
requirements in the transaction agreements to maintain a back-up
servicer
for the mortgage loans are maintained.
|
X
|
|
|
1122(d)(1)(iv)
|
A
fidelity bond and errors and omissions policy is in effect on the
party
participating in the servicing function throughout the reporting
period in
the amount of coverage required by and otherwise in accordance
with the
terms of the transaction agreements.
|
X
|
|
|
Cash
Collection and Administration
|
|||
|
1122(d)(2)(i)
|
Payments
on mortgage loans are deposited into the appropriate custodial
bank
accounts and related bank clearing accounts no more than two business
days
following receipt, or such other number of days specified in the
transaction agreements.
|
X
|
|
|
1122(d)(2)(ii)
|
Disbursements
made via wire transfer on behalf of an obligor or to an investor
are made
only by authorized personnel.
|
X
|
|
|
1122(d)(2)(iii)
|
Advances
of funds or guarantees regarding collections, cash flows or distributions,
and any interest or other fees charged for such advances, are made,
reviewed and approved as specified in the transaction agreements.
|
X
|
|
|
1122(d)(2)(iv)
|
The
related accounts for the transaction, such as cash reserve accounts
or
accounts established as a form of overcollateralization, are separately
maintained (e.g., with respect to commingling of cash) as set forth
in the
transaction agreements.
|
X
|
|
|
1122(d)(2)(v)
|
Each
custodial account is maintained at a federally insured depository
institution as set forth in the transaction agreements. For purposes
of
this criterion, “federally insured depository institution” with respect to
a foreign financial institution means a foreign financial institution
that
meets the requirements of Rule 13k-1(b)(1) of the Securities Exchange
Act.
|
X
|
|
|
1122(d)(2)(vi)
|
Unissued
checks are safeguarded so as to prevent unauthorized access.
|
X
|
|
Reg
AB Reference
|
Servicing
Criteria con’t
|
Applicable
Servicing Criteria
|
Inapplicable
Servicing Criteria
|
|
Cash
Collection and Administration con’t
|
|||
|
1122(d)(2)(vii)
|
Reconciliations
are prepared on a monthly basis for all asset-backed securities
related
bank accounts, including custodial accounts and related bank clearing
accounts. These reconciliations are (A) mathematically accurate;
(B)
prepared within 30 calendar days after the bank statement cutoff
date, or
such other number of days specified in the transaction agreements;
(C)
reviewed and approved by someone other than the person who prepared
the
reconciliation; and (D) contain explanations for reconciling items.
These
reconciling items are resolved within 90 calendar days of their
original
identification, or such other number of days specified in the transaction
agreements.
|
X
|
|
|
Investor
Remittances and Reporting
|
|||
|
1122(d)(3)(i)
|
Reports
to investors, including those to be filed with the Commission,
are
maintained in accordance with the transaction agreements and applicable
Commission requirements. Specifically, such reports (A) are prepared
in
accordance with timeframes and other terms set forth in the transaction
agreements; (B) provide information calculated in accordance with
the
terms specified in the transaction agreements; (C) are filed with
the
Commission as required by its rules and regulations; and (D) agree
with
investors’ or the trustee’s records as to the total unpaid principal
balance and number of mortgage loans serviced by the Servicer.
|
X
|
|
|
1122(d)(3)(ii)
|
Amounts
due to investors are allocated and remitted in accordance with
timeframes,
distribution priority and other terms set forth in the transaction
agreements.
|
X
|
|
|
1122(d)(3)(iii)
|
Disbursements
made to an investor are posted within two business days to the
Servicer’s
investor records, or such other number of days specified in the
transaction agreements.
|
X
|
|
|
1122(d)(3)(iv)
|
Amounts
remitted to investors per the investor reports agree with cancelled
checks, or other form of payment, or custodial bank statements.
|
X
|
|
|
Pool
Asset Administration
|
|||
|
1122(d)(4)(i)
|
Collateral
or security on mortgage loans is maintained as required by the
transaction
agreements or related mortgage loan documents.
|
X
|
|
|
1122(d)(4)(ii)
|
Mortgage
loan and related documents are safeguarded as required by the transaction
agreements
|
X
|
|
|
1122(d)(4)(iii)
|
Any
additions, removals or substitutions to the asset pool are made,
reviewed
and approved in accordance with any conditions or requirements
in the
transaction agreements.
|
X
|
|
|
1122(d)(4)(iv)
|
Payments
on mortgage loans, including any payoffs, made in accordance with
the
related mortgage loan documents are posted to the Servicer’s obligor
records maintained no more than two business days after receipt,
or such
other number of days specified in the transaction agreements, and
allocated to principal, interest or other items (e.g., escrow)
in
accordance with the related mortgage loan documents.
|
X
|
|
Reg
AB Reference
|
Servicing
Criteria con’t
|
Applicable
Servicing Criteria
|
Inapplicable
Servicing Criteria
|
|
Pool
Asset Administration con’t
|
|||
|
1122(d)(4)(v)
|
The
Servicer’s records regarding the mortgage loans agree with the Servicer’s
records with respect to an obligor’s unpaid principal balance.
|
X
|
|
|
1122(d)(4)(vi)
|
Changes
with respect to the terms or status of an obligor's mortgage loans
(e.g.,
loan modifications or re-agings) are made, reviewed and approved
by
authorized personnel in accordance with the transaction agreements
and
related pool asset documents.
|
X
|
|
|
1122(d)(4)(vii)
|
Loss
mitigation or recovery actions (e.g., forbearance plans, modifications
and
deeds in lieu of foreclosure, foreclosures and repossessions, as
applicable) are initiated, conducted and concluded in accordance
with the
timeframes or other requirements established by the transaction
agreements.
|
X
|
|
|
1122(d)(4)(viii)
|
Records
documenting collection efforts are maintained during the period
a mortgage
loan is delinquent in accordance with the transaction agreements.
Such
records are maintained on at least a monthly basis, or such other
period
specified in the transaction agreements, and describe the entity’s
activities in monitoring delinquent mortgage loans including, for
example,
phone calls, letters and payment rescheduling plans in cases where
delinquency is deemed temporary (e.g., illness or unemployment).
|
X
|
|
|
1122(d)(4)(ix)
|
Adjustments
to interest rates or rates of return for mortgage loans with variable
rates are computed based on the related mortgage loan documents.
|
X
|
|
|
1122(d)(4)(x)
|
Regarding
any funds held in trust for an obligor (such as escrow accounts):
(A) such
funds are analyzed, in accordance with the obligor’s mortgage loan
documents, on at least an annual basis, or such other period specified
in
the transaction agreements; (B) interest on such funds is paid,
or
credited, to obligors in accordance with applicable mortgage loan
documents and state laws; and (C) such funds are returned to the
obligor
within 30 calendar days of full repayment of the related mortgage
loans,
or such other number of days specified in the transaction agreements.
|
X
|
|
|
1122(d)(4)(xi)
|
Payments
made on behalf of an obligor (such as tax or insurance payments)
are made
on or before the related penalty or expiration dates, as indicated
on the
appropriate bills or notices for such payments, provided that such
support
has been received by the servicer at least 30 calendar days prior
to these
dates, or such other number of days specified in the transaction
agreements.
|
X
|
|
|
1122(d)(4)(xii)
|
Any
late payment penalties in connection with any payment to be made
on behalf
of an obligor are paid from the Servicer’s funds and not charged to the
obligor, unless the late payment was due to the obligor’s error or
omission.
|
X
|
|
|
1122(d)(4)(xiii)
|
Disbursements
made on behalf of an obligor are posted within two business days
to the
obligor’s records maintained by the servicer, or such other number of days
specified in the transaction agreements.
|
X
|
|
Reg
AB Reference
|
Servicing
Criteria con’t
|
Applicable
Servicing Criteria
|
Inapplicable
Servicing Criteria
|
|
Pool
Asset Administration con’t
|
|||
|
1122(d)(4)(xiv)
|
Delinquencies,
charge-offs and uncollectible accounts are recognized and recorded
in
accordance with the transaction agreements.
|
X
|
|
|
1122(d)(4)(xv)
|
Any
external enhancement or other support, identified in Item 1114(a)(1)
through (3) or Item 1115 of Regulation AB, is maintained as set
forth in
the transaction agreements.
|
X
|
EXHIBIT
N
SARBANES
CERTIFICATE
|
Re:
|
The
[ ]
agreement
dated as of [ ],
200[ ]
(the
“Agreement”), among [IDENTIFY
PARTIES]
|
I,
________________________________, the _______________________ of [Name of
Servicer], certify to [the Owner], [the Depositor], and the [Master Servicer]
[Securities Administrator] [Trustee], and their officers, with the knowledge
and
intent that they will rely upon this certification, that:
(1) I
have
reviewed the servicer compliance statement of the Servicer provided in
accordance with Item 1123 of Regulation AB (the “Compliance Statement”), the
report on assessment of the Servicer’s compliance with the servicing criteria
set forth in Item 1122(d) of Regulation AB (the “Servicing Criteria”), provided
in accordance with Rules 13a-18 and 15d-18 under Securities Exchange Act
of
1934, as amended (the “Exchange Act”) and Item 1122 of Regulation AB (the
“Servicing Assessment”), the registered public accounting firm’s attestation
report provided in accordance with Rules 13a-18 and 15d-18 under the Exchange
Act and Section 1122(b) of Regulation AB (the “Attestation Report”), and all
servicing reports, officer’s certificates and other information relating to the
servicing of the Mortgage Loans by the Servicer during 200[ ] that were
delivered by the Servicer to the [Depositor] [Master Servicer] [Securities
Administrator] [Trustee] pursuant to the Agreement (collectively, the “Servicer
Servicing Information”);
(2) Based
on
my knowledge, the Servicer Servicing Information, taken as a whole, does
not
contain any untrue statement of a material fact or omit to state a material
fact
necessary to make the statements made, in the light of the circumstances
under
which such statements were made, not misleading with respect to the period
of
time covered by the Servicer Servicing Information;
(3) Based
on
my knowledge, all of the Servicer Servicing Information required to be provided
by the Servicer under the Agreement has been provided to the [Depositor]
[Master
Servicer] [Securities Administrator] [Trustee];
(4) I
am
responsible for reviewing the activities performed by the Servicer under
the
Agreement, and based on my knowledge and the compliance review conducted
in
preparing the Compliance Statement and except as disclosed in the Compliance
Statement, the Servicing Assessment or the Attestation Report, the Servicer
has
fulfilled its obligations under the Agreement; and
(5) The
Compliance Statement, the Servicing Assessment and the Attestation Report
required to be provided by the Servicer pursuant to the Agreement have been
provided to the [Depositor] [Master Servicer]. Any material instances of
noncompliance described in such reports have been disclosed to the [Depositor]
[Master Servicer]. Any material instance of noncompliance with the Servicing
Criteria has been disclosed in such reports.
Date:
By:
Name:
Title:
