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XXXXXX XXXXXXX ABS CAPITAL I INC.,
as Depositor,
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as Master Servicer and Securities Administrator,
SAXON MORTGAGE SERVICES, INC.
as Servicer,
IXIS REAL ESTATE CAPITAL INC.,
as Unaffiliated Seller,
and
DEUTSCHE BANK NATIONAL TRUST COMPANY,
as Trustee and Custodian.
POOLING AND SERVICING AGREEMENT
Dated as of January 1, 2007
IXIS REAL ESTATE CAPITAL TRUST 2007-HE1
MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2007-HE1
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TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS.............................................................................. 21
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES............................ 72
Section 2.01 Conveyance of Mortgage Loans...................................................... 72
Section 2.02 Acceptance by the Custodian of the Mortgage Loans................................. 79
Section 2.03 Representations, Warranties and Covenants of the Unaffiliated Seller and the
Servicer.......................................................................... 80
Section 2.04 The Depositor and the Mortgage Loans.............................................. 85
Section 2.05 Delivery of Opinion of Counsel or Officer's Certificate in Connection with
Substitutions and Non-Qualified Mortgages......................................... 85
Section 2.06 Execution and Delivery of Certificates............................................ 86
Section 2.07 REMIC Matters..................................................................... 86
Section 2.08 Representations and Warranties of the Depositor................................... 86
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS......................................... 88
Section 3.01 Servicer to Service Mortgage Loans................................................ 88
Section 3.02 Subservicing Agreements Between the Servicer and Subservicers..................... 90
Section 3.03 Successor Subservicers............................................................ 92
Section 3.04 Liability of the Servicer......................................................... 92
Section 3.05 No Contractual Relationship Between Subservicers and the Trustee.................. 93
Section 3.06 Assumption or Termination of Subservicing Agreements by Master Servicer........... 93
Section 3.07 Collection of Certain Mortgage Loan Payments; Establishment of Certain Accounts... 93
Section 3.08 Subservicing Accounts............................................................. 99
Section 3.09 Collection of Taxes, Assessments and Similar Items; Escrow Accounts............... 99
Section 3.10 Collection Accounts............................................................... 100
Section 3.11 Withdrawals from the Collection Account........................................... 101
Section 3.12 Investment of Funds in the Accounts............................................... 103
Section 3.13 Maintenance of Hazard Insurance and Errors and Omissions and Fidelity Coverage.... 105
Section 3.14 Enforcement of Due-On-Sale Clauses Assumption Agreements.......................... 106
Section 3.15 Realization Upon Defaulted Mortgage Loans......................................... 107
Section 3.16 Release of Mortgage Files......................................................... 109
Section 3.17 Title, Conservation and Disposition of REO Property............................... 110
Section 3.18 Notification of Adjustments....................................................... 111
Section 3.19 Access to Certain Documentation and Information Regarding the Mortgage Loans...... 112
Section 3.20 Documents, Records and Funds in Possession of the Servicer to be Held for the
Securities Administrator.......................................................... 112
Section 3.21 Servicing Compensation............................................................ 113
Section 3.22 Annual Statement as to Compliance................................................. 113
i
Section 3.23 Annual Independent Public Accountants' Servicing Statement; Financial Statements.. 114
Section 3.24 Master Servicer to Act as Servicer................................................ 116
Section 3.25 Compensating Interest............................................................. 116
Section 3.26 Credit Reporting; Xxxxx-Xxxxx-Xxxxxx Act.......................................... 116
Section 3.27 Advance Facilities................................................................ 117
ARTICLE IV DISTRIBUTIONS AND ADVANCES BY THE SERVICER.............................................. 119
Section 4.01 Advances.......................................................................... 119
Section 4.02 Priorities of Distribution........................................................ 120
Section 4.03 Monthly Statements to Certificateholders.......................................... 129
Section 4.04 Certain Matters Relating to the Determination of LIBOR............................ 133
Section 4.05 [Reserved]........................................................................ 134
Section 4.06 [Reserved]........................................................................ 134
Section 4.07 Allocation of Applied Realized Loss Amounts....................................... 134
ARTICLE V THE CERTIFICATES......................................................................... 134
Section 5.01 The Certificates.................................................................. 134
Section 5.02 Certificate Register; Registration of Transfer and Exchange of Certificates....... 135
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates................................. 140
Section 5.04 Persons Deemed Owners............................................................. 140
Section 5.05 Access to List of Certificateholders' Names and Addresses......................... 141
Section 5.06 Maintenance of Office or Agency................................................... 141
ARTICLE VI THE DEPOSITOR AND THE SERVICER.......................................................... 141
Section 6.01 Respective Liabilities of the Depositor and the Servicer.......................... 141
Section 6.02 Merger or Consolidation of the Depositor or the Servicer.......................... 141
Section 6.03 Limitation on Liability of the Depositor, the Servicer and Others................. 142
Section 6.04 Limitation on Resignation of the Servicer......................................... 143
Section 6.05 Additional Indemnification by the Servicer; Third Party Claims.................... 144
ARTICLE VII DEFAULT ............................................................................... 145
Section 7.01 Events of Default................................................................. 145
Section 7.02 Master Servicer to Act; Appointment of Successor.................................. 148
Section 7.03 Notification to Certificateholders................................................ 149
ARTICLE VIII CONCERNING THE TRUSTEE................................................................ 150
Section 8.01 Duties of the Trustee............................................................. 150
Section 8.02 Certain Matters Affecting the Trustee and the Custodian........................... 151
Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans............................. 152
Section 8.04 Trustee May Own Certificates...................................................... 153
Section 8.05 Trustee's and Custodian's Fees and Expenses....................................... 153
Section 8.06 Eligibility Requirements for the Trustee.......................................... 153
Section 8.07 Resignation and Removal of the Trustee............................................ 154
Section 8.08 Successor Trustee................................................................. 154
Section 8.09 Merger or Consolidation of the Trustee............................................ 155
Section 8.10 Appointment of Co-Trustee or Separate Trustee..................................... 155
ii
Section 8.11 Tax Matters....................................................................... 157
Section 8.12 Periodic Filings.................................................................. 159
Section 8.13 Tax Classification of the Supplemental Interest Trust, the Excess Reserve Fund
Account and the Swap Account...................................................... 165
Section 8.14 Interest Rate Swap Agreement...................................................... 166
Section 8.15 Interest Rate Cap Agreement....................................................... 166
ARTICLE IX ADMINISTRATION OF THE MORTGAGE LOANS BY THE MASTER SERVICER............................. 166
Section 9.01 Duties of the Master Servicer; Enforcement of the Servicer's Obligations.......... 166
Section 9.02 Maintenance of Fidelity Bond and Errors and Omissions Insurance................... 167
Section 9.03 Representations and Warranties of the Master Servicer............................. 167
Section 9.04 Master Servicer Events of Default................................................. 169
Section 9.05 Waiver of Default................................................................. 170
Section 9.06 Successor to the Master Servicer.................................................. 171
Section 9.07 Compensation of the Master Servicer............................................... 172
Section 9.08 Merger or Consolidation........................................................... 172
Section 9.09 Resignation of the Master Servicer................................................ 172
Section 9.10 Assignment or Delegation of Duties by the Master Servicer......................... 173
Section 9.11 Limitation on Liability of the Master Servicer.................................... 173
Section 9.12 Indemnification; Third Party Claims............................................... 174
ARTICLE X CONCERNING THE SECURITIES ADMINISTRATOR.................................................. 175
Section 10.01 Duties of Securities Administrator................................................ 175
Section 10.02 Certain Matters Affecting the Securities Administrator............................ 176
Section 10.03 Securities Administrator Not Liable for Certificates or Mortgage Loans............ 178
Section 10.04 Securities Administrator May Own Certificates..................................... 178
Section 10.05 Securities Administrator's Fees and Expenses...................................... 178
Section 10.06 Eligibility Requirements for Securities Administrator............................. 179
Section 10.07 Resignation and Removal of Securities Administrator............................... 180
Section 10.08 Successor Securities Administrator................................................ 180
Section 10.09 Merger or Consolidation of Securities Administrator............................... 181
Section 10.10 Assignment or Delegation of Duties by the Securities Administrator................ 181
ARTICLE XI TERMINATION............................................................................. 182
Section 11.01 Termination upon Liquidation or Purchase of the Mortgage Loans.................... 182
Section 11.02 Final Distribution on the Certificates............................................ 183
Section 11.03 Additional Termination Requirements............................................... 184
ARTICLE XII MISCELLANEOUS PROVISIONS............................................................... 185
Section 12.01 Amendment......................................................................... 185
Section 12.02 Recordation of Agreement; Counterparts............................................ 187
Section 12.03 Governing Law..................................................................... 188
Section 12.04 Intention of Parties.............................................................. 188
Section 12.05 Notices........................................................................... 188
Section 12.06 Severability of Provisions........................................................ 189
Section 12.07 Assignment........................................................................ 190
iii
Section 12.08 Limitation on Rights of Certificateholders........................................ 190
Section 12.09 Inspection and Audit Rights....................................................... 191
Section 12.10 Certificates Nonassessable and Fully Paid......................................... 191
Section 12.11 [Reserved]........................................................................ 191
Section 12.12 Third Party Beneficiary........................................................... 191
Section 12.13 Waiver of Jury Trial.............................................................. 191
Section 12.14 Regulation AB Compliance; Intent of the Parties; Reasonableness................... 191
SCHEDULES
Schedule I Mortgage Loan Schedule
Schedule IA [Reserved]
Schedule IB Schedule of Saxon Serviced Loans
Schedule II [Reserved]
Schedule IIA [Reserved]
Schedule III Representations and Warranties of Saxon
Schedule IIIA Further Representations and Warranties of Saxon
Schedule IV Representations and Warranties as to the Unaffiliated Seller
EXHIBITS
Exhibit A Form of Class A-1, Class X-0, Xxxxx X-0, Class A-4, Class
M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6,
Class B-1, Class B-2 and Class B-3
Exhibit B Form of Class B-4 Certificate
Exhibit C Form of Class P Certificate
Exhibit D Form of Class R Certificate
Exhibit E Form of Class X Certificate
Exhibit F Form of Initial Certification of Custodian
Exhibit G Form of Final Certification of Custodian
Exhibit H Form of Residual Transfer Affidavit
Exhibit I Form of Transferor Certificate
Exhibit J Form of Rule 144A Letter
Exhibit K Form of Request for Release
Exhibit L Form of Subsequent Transfer Agreement
Exhibit M Depositor Certification
Exhibit N-1 Servicer Certification to be provided to Depositor
Exhibit N-2 Master Servicer Certification to be provided to Depositor
Exhibit O Trustee Certification to be provided to Depositor
Exhibit P Form for Calculation of Realized Loss/Gain
Exhibit Q Servicing Criteria
Exhibit R Additional Form 10-D Disclosure
Exhibit S Additional Form 10-K Disclosure
Exhibit T Form 8-K Disclosure Information
Exhibit U Interest Rate Swap Agreement
Exhibit V Interest Rate Cap Agreement
Exhibit W Form of Advance Reimbursement Notice
Exhibit X Form of Master Servicer's Report
Exhibit Y Accredited Agreements
iv
Exhibit Z CIT Agreements
Exhibit AA First Bank Agreements
Exhibit BB First Horizon Agreements
Exhibit CC First NLC Agreements
Exhibit DD FlexPoint Agreements
Exhibit EE Funding America Agreements
Exhibit FF Lenders Direct Agreements
Exhibit GG Lime Financial Agreements
Exhibit HH Mandalay Agreements
Exhibit II Master Financial Agreements
Exhibit XX Xxxxx Agreements
Exhibit KK NC Capital Agreements
Exhibit LL Platinum Agreements
Exhibit MM Quick Loan Agreements
Exhibit NN Rose Agreements
Exhibit OO Sebring Purchase Agreement
v
THIS POOLING AND SERVICING AGREEMENT, dated as of January 1, 2007,
among XXXXXX XXXXXXX ABS CAPITAL I INC., a Delaware corporation, as depositor
(the "Depositor"), XXXXX FARGO BANK, NATIONAL ASSOCIATION, a banking association
organized under the laws of the United States, as master servicer and securities
administrator (in each such capacity, respectively, the "Master Servicer" and
the "Securities Administrator"), SAXON MORTGAGE SERVICES, INC., a Texas
corporation ("Saxon" or the "Servicer"), IXIS REAL ESTATE CAPITAL INC. (f/k/a
CDC Mortgage Capital Inc.), a New York corporation, as unaffiliated seller (the
"Unaffiliated Seller") and DEUTSCHE BANK NATIONAL TRUST COMPANY, a national
banking association, as trustee and custodian (in each such capacity
respectively, the "Trustee" and the "Custodian").
WITNESSETH:
In consideration of the mutual agreements herein contained, the parties hereto
agree as follows:
PRELIMINARY STATEMENT
The Securities Administrator on behalf of the Trustee shall elect that
five segregated asset pools within the Trust Fund be treated for federal income
tax purposes as comprising five REMICs (each a "REMIC" or, in the alternative,
REMIC I, REMIC II, REMIC III, REMIC IV and REMIC V, respectively). Each Class of
Certificates, other than the Class P and Class R Certificates and other than the
right of each Class of LIBOR Certificates to receive Basis Risk Carry Forward
Amounts and the right of the Class X Certificates to receive payments from the
Interest Rate Swap Agreement, the Interest Rate Cap Agreement and the
Pre-Funding Reserve Account, represents ownership of one or more regular
interests in REMIC V for purposes of the REMIC Provisions. Additionally, the
Class X Certificates represent the obligation to make certain payments of Basis
Risk Carry Forward Amounts to Holders of LIBOR Certificates, and the LIBOR
Certificates represent the obligation to make certain payments to the Class X
Certificateholder to the extent that the interest accrued on its corresponding
REMIC V Regular Interest is in excess of the interest accrued on such LIBOR
Certificate. The Class P Certificates represent beneficial ownership of the
Prepayment Charges, which portion of the Trust Fund shall be treated as a
grantor trust. The Class I Interests are uncertificated REMIC V Regular
Interests and are designed to fund net swap payments, in full or in part, on the
Interest Rate Swap Agreement. The Class R Certificate represents ownership of
the sole class of residual interest in each of REMIC I, REMIC II, REMIC III,
REMIC IV and REMIC V for purposes of the REMIC Provisions. The Class R-V, Class
R-IV, Class R-III, Class R-II and Class R-I Interests comprise the Class R
Certificate. The Startup Day for each REMIC described herein is the Closing
Date. The latest possible maturity date for each regular interest is the date
referenced for such regular interest in this preliminary statement.
REMIC V shall hold as assets the several classes of uncertificated
REMIC IV Regular Interests. Each such REMIC IV Regular Interest is hereby
designated as a regular interest in REMIC IV. The Class IV-A-1, Class IV-A-2,
Class IV-A-3, Class IV-A-4, Class IV-M-1, Class IV-M-2, Class IV-M-3, Class
IV-M-4, Class IV-M-5, Class IV-M-6, Class IV-B-1,
1
Class IV-B-2, Class IV-B-3, and Class IV-B-4 Interests are hereby designated the
REMIC IV Accretion Directed Classes.
REMIC IV shall hold as assets the several classes of uncertificated
REMIC III Regular Interests. Each such REMIC III Regular Interest is hereby
designated as a regular interest in REMIC III.
REMIC III shall hold as assets the several classes of uncertificated
REMIC II Regular Interests. Each such REMIC II Regular Interest is hereby
designated as a regular interest in REMIC II.
REMIC II shall hold as assets the several classes of uncertificated
REMIC I Regular Interests. Each such REMIC I Regular Interest is hereby
designated as a regular interest in REMIC I.
REMIC I shall hold as assets all of the assets included in the Trust
Fund other than the Prepayment Charges, the Supplemental Interest Trust, the
Excess Reserve Fund Account, the Swap Account, the Pre-Funding Account, the
Pre-Funding Reserve Account, the Capitalized Interest Account, the Interest Rate
Cap Agreement and the Interest Rate Swap Agreement.
The REMIC I Regular Interests and the Class R-I Interest shall have
the following tier interest rate, initial tier principal amount and latest
possible maturity date as set forth in the table below.
REMIC I CLASS TIER INTEREST INITIAL TIER PRINCIPAL LATEST POSSIBLE
DESIGNATION RATE AMOUNT MATURITY DATE
------------- ------------- ---------------------- ----------------
Class I-C1 (1) $649,793,393.95 May 25, 2037
Class I-PO1 (2) $145,206,606.05 May 25, 2037
Class I-N (3) (4) April 25, 2007
Class R-I (5) (5)
(1) The interest rate with respect to any Distribution Date for this Class I-C1
Interest is (i) for the first three Distribution Dates, a per annum
variable rate equal to the weighted average of the Adjusted Net Mortgage
Rates then in effect at the beginning of the related Prepayment Period on
the Initial Mortgage Loans, and (ii) thereafter, a per annum variable rate
equal to the weighted average of the Adjusted Net Mortgage Rates then in
effect at the beginning of the related Prepayment Period on the Mortgage
Loans.
(2) The interest rate with respect to any Distribution Date for the Class I-PO1
Interest is (i) for the first three Distribution Dates, 0.00% and (ii)
thereafter, a per annum variable rate equal to the weighted average of the
Adjusted Net Mortgage Rates then in effect at the beginning of the related
Prepayment Period on the Mortgage Loans.
2
(3) The interest rate with respect to any Distribution Date for the Class I-N
Interest is (i) for the first three Distribution Dates, all interest on the
Subsequent Mortgage Loans for such Distribution Date divided by
$145,206,606.05 and (ii) thereafter, 0.00%.
(4) The Class I-N Interest will have a notional principal balance equal to
$145,206,606.05.
(5) The Class R-I Interest is the sole class of residual interest in REMIC I.
The Class R-I does not have a principal amount or an interest rate.
During the Pre-Funding Period, all principal payments (scheduled and
prepaid) and Realized Losses with respect to the Initial Mortgage Loans shall be
allocated to the Class I-C1 Interest, until such Class is paid in full or
eliminated by such losses. All principal payments (scheduled and prepaid) and
Realized Losses generated with respect to the Subsequent Mortgage Loans and any
amounts transferred from the Pre-Funding Account to REMIC I shall be allocated
to the Class I-PO1 Interest.
On each Distribution Date thereafter, all principal payments
(scheduled and prepaid) and Realized Losses generated with respect to the
Mortgage Loans shall be allocated, pro rata, to the Class I-C1 and Class I-PO1
Interests, until such Classes are paid in full or eliminated by such losses..
The REMIC II Regular Interests and the Class R-II Interest shall have
the following tier interest rate, initial tier principal amount and latest
possible maturity date as set forth in the table below.
REMIC II CLASS TIER INTEREST INITIAL TIER PRINCIPAL LATEST POSSIBLE
DESIGNATION RATE AMOUNT MATURITY DATE
-------------- ------------- ---------------------- ----------------
Class II-C1 (1) $ 21,848,018.30 May 25, 2037
Class II-C2 (1) $ 21,165,492.00 May 25, 2037
Class II-C3 (1) $ 20,453,385.90 May 25, 2037
Class II-C4 (1) $ 19,751,451.70 May 25, 2037
Class II-C5 (1) $ 18,863,516.40 May 25, 2037
Class II-C6 (1) $ 35,798,061.50 May 25, 2037
Class II-C7 (1) $ 37,518,606.30 May 25, 2037
Class II-C8 (1) $ 19,983,395.30 May 25, 2037
Class II-C9 (1) $ 24,276,866.20 May 25, 2037
Class II-C10 (1) $ 53,088,625.00 May 25, 2037
3
Class II-C11 (1) $ 17,161,009.20 May 25, 2037
Class II-C12 (1) $ 16,703,818.30 May 25, 2037
Class II-C13 (1) $ 15,026,406.40 May 25, 2037
Class II-C14 (1) $ 13,934,763.10 May 25, 2037
Class II-C15 (1) $ 18,474,501.60 May 25, 2037
Class II-C16 (1) $ 47,825,248.60 May 25, 2037
Class II-C17 (1) $ 11,632,187.70 May 25, 2037
Class II-C18 (1) $ 11,346,918.00 May 25, 2037
Class II-C19 (1) $ 9,893,387.30 May 25, 2037
Class II-C20 (1) $ 7,551,006.00 May 25, 2037
Class II-C21 (1) $ 10,156,370.90 May 25, 2037
Class II-C22 (1) $ 27,448,617.00 May 25, 2037
Class II-C23 (1) $ 9,351,583.60 May 25, 2037
Class II-C24 (1) $ 7,019,121.20 May 25, 2037
Class II-C25 (1) $ 5,555,409.80 May 25, 2037
Class II-C26 (1) $ 2,888,583.90 May 25, 2037
Class II-C27 (1) $ 2,522,876.40 May 25, 2037
Class II-C28 (1) $ 2,902,737.70 May 25, 2037
Class II-C29 (1) $ 5,322,823.20 May 25, 2037
Class II-C30 (1) $ 3,089,245.20 May 25, 2037
Class II-C31 (1) $ 2,355,432.20 May 25, 2037
Class II-C32 (1) $ 1,979,033.80 May 25, 2037
4
Class II-C33 (1) $ 1,685,879.30 May 25, 2037
Class II-C34 (1) $ 1,901,240.70 May 25, 2037
Class II-C35 (1) $ 3,289,302.50 May 25, 2037
Class II-C36 (1) $ 2,006,419.80 May 25, 2037
Class II-C37 (1) $ 1,571,495.10 May 25, 2037
Class II-C38 (1) $ 1,360,861.10 May 25, 2037
Class II-C39 (1) $ 1,176,127.60 May 25, 2037
Class II-C40 (1) $ 1,095,065.30 May 25, 2037
Class II-C41 (1) $ 1,046,772.80 May 25, 2037
Class II-C42 (1) $ 1,010,354.00 May 25, 2037
Class II-C43 (1) $ 975,193.10 May 25, 2037
Class II-C44 (1) $ 941,247.00 May 25, 2037
Class II-C45 (1) $ 908,468.50 May 25, 2037
Class II-C46 (1) $ 876,821.90 May 25, 2037
Class II-C47 (1) $ 857,031.20 May 25, 2037
Class II-C48 (1) $ 852,653.50 May 25, 2037
Class II-C49 (1) $ 797,161.00 May 25, 2037
Class II-C50 (1) $ 763,960.50 May 25, 2037
Class II-C51 (1) $ 736,578.50 May 25, 2037
Class II-C52 (1) $ 708,301.50 May 25, 2037
Class II-C53 (1) $ 694,070.90 May 25, 2037
Class II-54 (1) $ 695,436.40 May 25, 2037
5
Class II-55 (1) $ 643,744.00 May 25, 2037
Class II-56 (1) $ 615,481.30 May 25, 2037
Class II-57 (1) $ 593,129.90 May 25, 2037
Class II-58 (1) $ 569,704.70 May 25, 2037
Class II-59 (1) $ 555,563.90 May 25, 2037
Class II-60 (1) $ 550,753.70 May 25, 2037
Class II-61 (1) $ 515,895.70 May 25, 2037
Class II-62 (1) $ 13,957,632.10 May 25, 2037
Class II-J1 (1) $228,159,152.80 May 25, 2037
Class II-N (2) (3) April 25, 2007
Class R-II (4) (4)
(1) The interest rate with respect to any Distribution Date for these interests
is the weighted average of the interest rates of the Class I-C1 and Class
I-PO1 Interests.
(2) The Class II-N Interest is entitled to all distributions of interest on the
Class I-N Interest.
(3) The Class II-N Interest will have a notional principal balance equal to the
notional principal balance of the Class I-N Interest.
(4) The Class R-II Interest is the sole class of residual interest in REMIC II.
The Class R-II Interest does not have a principal amount or an interest
rate.
On each Distribution Date, all principal payments (scheduled and
prepaid) and Realized Losses generated with respect to the Mortgage Loans and
any amounts transferred from the Pre-Funding Account to REMIC I shall be
allocated in the following order: (i) first, to the Class II-J1 Interest until
such Class is paid in full or eliminated by such losses, (ii) second, to the
Class II-C1, Class II-C2, Class II-C3 and Class II-C4, in reverse numerical
order, until such Classes are paid in full or eliminated by such losses and
(iii) third to the Class II-C5 through Class II-C62 Interests, sequentially,
until such Classes are paid in full or eliminated by such losses.
6
The REMIC III Regular Interests and the Class R-III Interest shall
have the following, Corresponding REMIC II Regular Interest, tier interest rate,
initial tier principal amount and latest possible maturity date as set forth in
the table below.
CORRESPONDING INITIAL TIER
REMIC III CLASS REMIC II REGULAR TIER INTEREST PRINCIPAL LATEST POSSIBLE MATURITY
DESIGNATION INTEREST RATE AMOUNT DATE
--------------- ---------------- ------------- ------------ ------------------------
Class III-C1a Class II-C1 (1) (2) May 25, 2037
Class III-C1b Class II-C1 (5) (3) May 25, 2037
Class III-C1c Class II-C1 (6) (4) May 25, 2037
Class III-C2a Class II-C2 (1) (2) May 25, 2037
Class III-C2b Class II-C2 (5) (3) May 25, 2037
Class III-C2c Class II-C2 (6) (4) May 25, 2037
Class III-C3a Class II-C3 (1) (2) May 25, 2037
Class III-C3b Class II-C3 (5) (3) May 25, 2037
Class III-C3c Class II-C3 (6) (4) May 25, 2037
Class III-C4a Class II-C4 (1) (2) May 25, 2037
Class III-C4b Class II-C4 (5) (3) May 25, 2037
Class III-C4c Class II-C4 (6) (4) May 25, 2037
Class III-C5a Class II-C5 (1) (2) May 25, 2037
Class III-C5b Class II-C5 (5) (3) May 25, 2037
Class III-C5c Class II-C5 (6) (4) May 25, 2037
Class III-C6a Class II-C6 (1) (2) May 25, 2037
Class III-C6b Class II-C6 (5) (3) May 25, 2037
Class III-C6c Class II-C6 (6) (4) May 25, 2037
Class III-C7a Class II-C7 (1) (2) May 25, 2037
Class III-C7b Class II-C7 (5) (3) May 25, 2037
Class III-C7c Class II-C7 (6) (4) May 25, 2037
Class III-C8a Class II-C8 (1) (2) May 25, 2037
Class III-C8b Class II-C8 (5) (3) May 25, 2037
Class III-C8c Class II-C8 (6) (4) May 25, 2037
Class III-C9a Class II-C9 (1) (2) May 25, 2037
Class III-C9b Class II-C9 (5) (3) May 25, 2037
Class III-C9c Class II-C9 (6) (4) May 25, 2037
Class III-C10a Class II-C10 (1) (2) May 25, 2037
7
CORRESPONDING INITIAL TIER
REMIC III CLASS REMIC II REGULAR TIER INTEREST PRINCIPAL LATEST POSSIBLE MATURITY
DESIGNATION INTEREST RATE AMOUNT DATE
--------------- ---------------- ------------- ------------ ------------------------
Class III-C10b Class II-C10 (5) (3) May 25, 2037
Class III-C10c Class II-C10 (6) (4) May 25, 2037
Class III-C11a Class II-C11 (1) (2) May 25, 2037
Class III-C11b Class II-C11 (5) (3) May 25, 2037
Class III-C11c Class II-C11 (6) (4) May 25, 2037
Class III-C12a Class II-C12 (1) (2) May 25, 2037
Class III-C12b Class II-C12 (5) (3) May 25, 2037
Class III-C12c Class II-C12 (6) (4) May 25, 2037
Class III-C13a Class II-C13 (1) (2) May 25, 2037
Class III-C13b Class II-C13 (5) (3) May 25, 2037
Class III-C13c Class II-C13 (6) (4) May 25, 2037
Class III-C14a Class II-C14 (1) (2) May 25, 2037
Class III-C14b Class II-C14 (5) (3) May 25, 2037
Class III-C14c Class II-C14 (6) (4) May 25, 2037
Class III-C15a Class II-C15 (1) (2) May 25, 2037
Class III-C15b Class II-C15 (5) (3) May 25, 2037
Class III-C15c Class II-C15 (6) (4) May 25, 2037
Class III-C16a Class II-C16 (1) (2) May 25, 2037
Class III-C16b Class II-C16 (5) (3) May 25, 2037
Class III-C16c Class II-C16 (6) (4) May 25, 2037
Class III-C17a Class II-C17 (1) (2) May 25, 2037
Class III-C17b Class II-C17 (5) (3) May 25, 2037
Class III-C17c Class II-C17 (6) (4) May 25, 2037
Class III-C18a Class II-C18 (1) (2) May 25, 2037
Class III-C18b Class II-C18 (5) (3) May 25, 2037
Class III-C18c Class II-C18 (6) (4) May 25, 2037
Class III-C19a Class II-C19 (1) (2) May 25, 2037
Class III-C19b Class II-C19 (5) (3) May 25, 2037
8
CORRESPONDING INITIAL TIER
REMIC III CLASS REMIC II REGULAR TIER INTEREST PRINCIPAL LATEST POSSIBLE MATURITY
DESIGNATION INTEREST RATE AMOUNT DATE
--------------- ---------------- ------------- ------------ ------------------------
Class III-C19c Class II-C19 (6) (4) May 25, 2037
Class III-C20a Class II-C20 (1) (2) May 25, 2037
Class III-C20b Class II-C20 (5) (3) May 25, 2037
Class III-C20c Class II-C20 (6) (4) May 25, 2037
Class III-C21a Class II-C21 (1) (2) May 25, 2037
Class III-C21b Class II-C21 (5) (3) May 25, 2037
Class III-C21c Class II-C21 (6) (4) May 25, 2037
Class III-C22a Class II-C22 (1) (2) May 25, 2037
Class III-C22b Class II-C22 (5) (3) May 25, 2037
Class III-C22c Class II-C22 (6) (4) May 25, 2037
Class III-C23a Class II-C23 (1) (2) May 25, 2037
Class III-C23b Class II-C23 (5) (3) May 25, 2037
Class III-C23c Class II-C23 (6) (4) May 25, 2037
Class III-C24a Class II-C24 (1) (2) May 25, 2037
Class III-C24b Class II-C24 (5) (3) May 25, 2037
Class III-C24c Class II-C24 (6) (4) May 25, 2037
Class III-C25a Class II-C25 (1) (2) May 25, 2037
Class III-C25b Class II-C25 (5) (3) May 25, 2037
Class III-C25c Class II-C25 (6) (4) May 25, 2037
Class III-C26a Class II-C26 (1) (2) May 25, 2037
Class III-C26b Class II-C26 (5) (3) May 25, 2037
Class III-C26c Class II-C26 (6) (4) May 25, 2037
Class III-C27a Class II-C27 (1) (2) May 25, 2037
Class III-C27b Class II-C27 (5) (3) May 25, 2037
Class III-C27c Class II-C27 (6) (4) May 25, 2037
Class III-C28a Class II-C28 (1) (2) May 25, 2037
Class III-C28b Class II-C28 (5) (3) May 25, 2037
Class III-C28c Class II-C28 (6) (4) May 25, 2037
9
CORRESPONDING INITIAL TIER
REMIC III CLASS REMIC II REGULAR TIER INTEREST PRINCIPAL LATEST POSSIBLE MATURITY
DESIGNATION INTEREST RATE AMOUNT DATE
--------------- ---------------- ------------- ------------ ------------------------
Class III-C29a Class II-C29 (1) (2) May 25, 2037
Class III-C29b Class II-C29 (5) (3) May 25, 2037
Class III-C29c Class II-C29 (6) (4) May 25, 2037
Class III-C30a Class II-C30 (1) (2) May 25, 2037
Class III-C30b Class II-C30 (5) (3) May 25, 2037
Class III-C30c Class II-C30 (6) (4) May 25, 2037
Class III-C31a Class II-C31 (1) (2) May 25, 2037
Class III-C31b Class II-C31 (5) (3) May 25, 2037
Class III-C31c Class II-C31 (6) (4) May 25, 2037
Class III-C32a Class II-C32 (1) (2) May 25, 2037
Class III-C32b Class II-C32 (5) (3) May 25, 2037
Class III-C32c Class II-C32 (6) (4) May 25, 2037
Class III-C33a Class II-C33 (1) (2) May 25, 2037
Class III-C33b Class II-C33 (5) (3) May 25, 2037
Class III-C33c Class II-C33 (6) (4) May 25, 2037
Class III-C34a Class II-C34 (1) (2) May 25, 2037
Class III-C34b Class II-C34 (5) (3) May 25, 2037
Class III-C34c Class II-C34 (6) (4) May 25, 2037
Class III-C35a Class II-C35 (1) (2) May 25, 2037
Class III-C35b Class II-C35 (5) (3) May 25, 2037
Class III-C35c Class II-C35 (6) (4) May 25, 2037
Class III-C36a Class II-C36 (1) (2) May 25, 2037
Class III-C36b Class II-C36 (5) (3) May 25, 2037
Class III-C36c Class II-C36 (6) (4) May 25, 2037
Class III-C37a Class II-C37 (1) (2) May 25, 2037
Class III-C37b Class II-C37 (5) (3) May 25, 2037
Class III-C37c Class II-C37 (6) (4) May 25, 2037
Class III-C38a Class II-C38 (1) (2) May 25, 2037
10
CORRESPONDING INITIAL TIER
REMIC III CLASS REMIC II REGULAR TIER INTEREST PRINCIPAL LATEST POSSIBLE MATURITY
DESIGNATION INTEREST RATE AMOUNT DATE
--------------- ---------------- ------------- ------------ ------------------------
Class III-C38b Class II-C38 (5) (3) May 25, 2037
Class III-C38c Class II-C38 (6) (4) May 25, 2037
Class III-C39a Class II-C39 (1) (2) May 25, 2037
Class III-C39b Class II-C39 (5) (3) May 25, 2037
Class III-C39c Class II-C39 (6) (4) May 25, 2037
Class III-C40a Class II-C40 (1) (2) May 25, 2037
Class III-C40b Class II-C40 (5) (3) May 25, 2037
Class III-C40c Class II-C40 (6) (4) May 25, 2037
Class III-C41a Class II-C41 (1) (2) May 25, 2037
Class III-C41b Class II-C41 (5) (3) May 25, 2037
Class III-C41c Class II-C41 (6) (4) May 25, 2037
Class III-C42a Class II-C42 (1) (2) May 25, 2037
Class III-C42b Class II-C42 (5) (3) May 25, 2037
Class III-C42c Class II-C42 (6) (4) May 25, 2037
Class III-C43a Class II-C43 (1) (2) May 25, 2037
Class III-C43b Class II-C43 (5) (3) May 25, 2037
Class III-C43c Class II-C43 (6) (4) May 25, 2037
Class III-C44a Class II-C44 (1) (2) May 25, 2037
Class III-C44b Class II-C44 (5) (3) May 25, 2037
Class III-C44c Class II-C44 (6) (4) May 25, 2037
Class III-C45a Class II-C45 (1) (2) May 25, 2037
Class III-C45b Class II-C45 (5) (3) May 25, 2037
Class III-C45c Class II-C45 (6) (4) May 25, 2037
Class III-C46a Class II-C46 (1) (2) May 25, 2037
Class III-C46b Class II-C46 (5) (3) May 25, 2037
Class III-C46c Class II-C46 (6) (4) May 25, 2037
Class III-C47a Class II-C47 (1) (2) May 25, 2037
Class III-C47b Class II-C47 (5) (3) May 25, 2037
11
CORRESPONDING INITIAL TIER
REMIC III CLASS REMIC II REGULAR TIER INTEREST PRINCIPAL LATEST POSSIBLE MATURITY
DESIGNATION INTEREST RATE AMOUNT DATE
--------------- ---------------- ------------- ------------ ------------------------
Class III-C47c Class II-C47 (6) (4) May 25, 2037
Class III-C48a Class II-C48 (1) (2) May 25, 2037
Class III-C48b Class II-C48 (5) (3) May 25, 2037
Class III-C48c Class II-C48 (6) (4) May 25, 2037
Class III-C49a Class II-C49 (1) (2) May 25, 2037
Class III-C49b Class II-C49 (5) (3) May 25, 2037
Class III-C49c Class II-C49 (6) (4) May 25, 2037
Class III-C50a Class II-C50 (1) (2) May 25, 2037
Class III-C50b Class II-C50 (5) (3) May 25, 2037
Class III-C50c Class II-C50 (6) (4) May 25, 2037
Class III-C51a Class II-C51 (1) (2) May 25, 2037
Class III-C51b Class II-C51 (5) (3) May 25, 2037
Class III-C51c Class II-C51 (6) (4) May 25, 2037
Class III-C52a Class II-C52 (1) (2) May 25, 2037
Class III-C52b Class II-C52 (5) (3) May 25, 2037
Class III-C52c Class II-C52 (6) (4) May 25, 2037
Class III-C53a Class II-C53 (1) (2) May 25, 2037
Class III-C53b Class II-C53 (5) (3) May 25, 2037
Class III-C53c Class II-C53 (6) (4) May 25, 2037
Class III-C54a Class II-C54 (1) (2) May 25, 2037
Class III-C54b Class II-C54 (5) (3) May 25, 2037
Class III-C54c Class II-C54 (6) (4) May 25, 2037
Class III-C55a Class II-C55 (1) (2) May 25, 2037
Class III-C55b Class II-C55 (5) (3) May 25, 2037
Class III-C55c Class II-C55 (6) (4) May 25, 2037
Class III-C56a Class II-C56 (1) (2) May 25, 2037
Class III-C56b Class II-C56 (5) (3) May 25, 2037
Class III-C56c Class II-C56 (6) (4) May 25, 2037
12
CORRESPONDING INITIAL TIER
REMIC III CLASS REMIC II REGULAR TIER INTEREST PRINCIPAL LATEST POSSIBLE MATURITY
DESIGNATION INTEREST RATE AMOUNT DATE
--------------- ---------------- ------------- ------------ ------------------------
Class III-C57a Class II-C57 (1) (2) May 25, 2037
Class III-C57b Class II-C57 (5) (3) May 25, 2037
Class III-C57c Class II-C57 (6) (4) May 25, 2037
Class III-C58a Class II-C58 (1) (2) May 25, 2037
Class III-C58b Class II-C58 (5) (3) May 25, 2037
Class III-C58c Class II-58 (6) (4) May 25, 2037
Class III-C59a Class II-C59 (1) (2) May 25, 2037
Class III-C59b Class II-C59 (5) (3) May 25, 2037
Class III-C59c Class II-C59 (6) (4) May 25, 2037
Class III-C60a Class II-C60 (1) (2) May 25, 2037
Class III-C60b Class II-C60 (5) (3) May 25, 2037
Class III-C60c Class II-60 (6) (4) May 25, 2037
Class III-C61a Class II-C61 (1) (2) May 25, 2037
Class III-C61b Class II-C61 (5) (3) May 25, 2037
Class III-C61c Class II-61 (6) (4) May 25, 2037
Class III-C62a Class II-C62 (1) (2) May 25, 2037
Class III-C62b Class II-C62 (5) (3) May 25, 2037
Class III-C62c Class II-62 (6) (4) May 25, 2037
Class III-J1 Class II-J1 (7) (8) May 25, 2037
Class III-N Class II-N (9) (10) April 25, 2006
Class R-III (11) (11)
(1) The interest rate for these REMIC III Regular Interests will be as follows:
(i) for all Distribution Dates commencing on the first Distribution Date
through and including the Distribution Date in November 2007, REMIC III Net
WAC, (ii) for all Distribution Dates commencing on the Distribution Date in
December 2007 through and including the Corresponding Distribution Date,
1.5 multiplied by (REMIC III Net WAC minus 4.883%) and (iii) for all other
Distribution Dates, REMIC III Net WAC.
(2) These REMIC III Regular Interests will have an initial principal balance
equal to the product of (i) the initial principal balance of the
Corresponding REMIC II Regular Interest and (ii) two divided by three.
(3) These REMIC III Regular Interests will have an initial principal balance
equal to the initial principal balance of the Corresponding REMIC II
Regular Interest divided by three.
(4) These REMIC III Regular Interests will have a notional principal balance
equal to the principal balance of the Corresponding REMIC II Regular
Interest.
(5) The interest rate for these REMIC III Regular Interests will be as follows:
(i) for all Distribution Dates commencing on the first Distribution Date
through and including the Distribution Date in November 2007, REMIC III Net
WAC, (ii) for all Distribution Dates commencing on the Distribution Date in
December 2007 through and including the Corresponding Distribution Date, 3
multiplied by 1 Month LIBOR, subject to a cap of 14.65% and (iii) for
all other Distribution Dates, REMIC III Net WAC.
(6) The interest rate for these REMIC III Regular Interests will be as follows:
(i) for all Distribution Dates commencing on the first Distribution Date
through and including the Distribution Date in November 2007, REMIC III Net
WAC, (ii) for all Distribution Dates commencing on the Distribution Date in
December 2007 through and including the Corresponding Distribution Date,
14.65% minus 1 month LIBOR, subject to a floor of zero and (ii) for all
other Distribution Dates, zero.
(7) The interest rate for this REMIC III Regular Interest will be equal to the
REMIC III Net WAC.
(8) These REMIC III Regular Interests will have an initial principal balance
equal to the initial principal balance of the Corresponding REMIC II
Regular Interest.
(9) The Class III-N Interest is entitled to all distributions of interest on
the Class II-N Interest.
(10) The Class III-N Interest will have a notional principal balance equal to
the notional principal balance of the Class II-N Interest.
(11) The Class R-III Interest is the sole class of residual interest in REMIC
III. The Class R-III Interest does not have a principal amount or an
interest rate.
On each Distribution Date, all principal payments (scheduled and
prepaid) and Realized Losses generated with respect to the Mortgage Loans and
any amounts transferred from the Pre-Funding Account to REMIC I shall be
allocated in the following order: (i) first, to the Class III-J1 Interest until
such Class is paid in full or eliminated by such losses, (ii) second, to the
Class III-C1a through Class III-C62a and Class III-C1b through Class III-C62b
Interests, first, pro rata between the two subsets of interests, and second, in
reverse numerical order among the subsets of interests, until such Classes are
paid in full or eliminated by such losses.
The REMIC IV Regular Interests and the Class R-IV Interest shall have
the following tier interest rate, initial principal amount, Corresponding REMIC
V Interest, and latest possible maturity date as set forth in the table below.
TIER CORRESPONDING
REMIC IV CLASS INTEREST INITIAL TIER PRINCIPAL REMIC V INTEREST/ LATEST POSSIBLE
DESIGNATION RATE AMOUNT CORRESPONDING CLASS MATURITY DATE
-------------- -------- ------------------------ ------------------- ---------------
Class IV-A-1 (1) 1/2 of the Corresponding Class A-1 May 25, 2037
Class initial principal
balance
Class IV-A-2 (1) 1/2 of the Corresponding Class A-2 May 25, 2037
Class initial principal
balance
Class IV-A-3 (1) 1/2 of the Class A-3 May 25, 2037
13
TIER CORRESPONDING
REMIC IV CLASS INTEREST INITIAL TIER PRINCIPAL REMIC V INTEREST/ LATEST POSSIBLE
DESIGNATION RATE AMOUNT CORRESPONDING CLASS MATURITY DATE
-------------- -------- ------------------------ ------------------- ---------------
Corresponding Class
initial principal
balance
Class IV-A-4 (1) 1/2 of the Corresponding Class A-4 May 25, 2037
Class initial principal
balance
Class IV-M-1 (1) 1/2 of the Corresponding Class M-1 May 25, 2037
Class initial principal
balance
Class IV-M-2 (1) 1/2 of the Corresponding Class M-2 May 25, 2037
Class initial principal
balance
Class IV-M-3 (1) 1/2 of the Corresponding Class M-3 May 25, 2037
Class initial principal
balance
Class IV-M-4 (1) 1/2 of the Corresponding Class M-4 May 25, 2037
Class initial principal
balance
Class IV-M-5 (1) 1/2 of the Corresponding Class M-5 May 25, 2037
Class initial principal
balance
Class IV-M-6 (1) 1/2 of the Corresponding Class M-6 May 25, 2037
Class initial principal
balance
Class IV-B-1 (1) 1/2 of the Corresponding Class B-1 May 25, 2037
Class initial principal
balance
Class IV-B-2 (1) 1/2 of the Corresponding Class B-2 May 25, 2037
Class initial principal
balance
14
TIER CORRESPONDING
REMIC IV CLASS INTEREST INITIAL TIER PRINCIPAL REMIC V INTEREST/ LATEST POSSIBLE
DESIGNATION RATE AMOUNT CORRESPONDING CLASS MATURITY DATE
-------------- -------- ------------------------ ------------------- ---------------
Class IV-B-3 (1) 1/2 of the Corresponding Class B-3 May 25, 2037
Class initial principal
balance
Class IV-B-4 (1) 1/2 of the Corresponding Class B-4 May 25, 2037
Class initial principal
balance
Class IV- (1) (2) N/A May 25, 2037
Accrual
Class IV-N (3) (4) Class X-2 April 25, 2006
Class IV-I1 (5) (5) Class I-1 August 25, 2007
Class IV-I2 (6) (6) Class I-2 August 25, 2008
Class IV-I3 (7) (7) Class I-3 August 25, 2009
Class IV-I4 (8) (8) Class I-4 August 25, 2010
Class IV-I5 (9) (9) Class I-5 June 25, 2011
Class R-IV (10) (10) Class R
(1) The interest rate with respect to any Distribution Date for these REMIC IV
Regular Interests is the REMIC IV Net WAC.
(2) The Class IV-Accrual Interest will have an initial principal balance equal
to the product of (a) 50% and (b) the sum of (i) the Pool Stated Principal
Balance (ii) the Subordinated Amount and (ii) the Initial Pre-Funded
Amount.
(3) The Class IV-N Interest is entitled to all distributions of interest on the
Class III-N Interest.
(4) The Class IV-N Interest will have a notional principal balance equal to the
notional principal balance of the Class III-N Interest.
(5) The Class IV-I1 Interest will be an interest-only regular interest and will
be entitled to receive, on each Distribution Date, the amount distributable
on the Class III-C1c through Class III-C13c Interests on such Distribution
Date.
15
(6) The Class IV-I2 Interest will be an interest-only regular interest and will
be entitled to receive, on each Distribution Date, the sum of the amounts
distributable on the Class III-C14c through Class III-C25c Interests on
such Distribution Date.
(7) The Class IV-I3 Interest will be an interest-only regular interest and will
be entitled to receive, on each Distribution Date, the sum of the amounts
distributable on the Class III-C26c through Class III-C37c Interests on
such Distribution Date.
(8) The Class IV-I4 Interest will be an interest-only regular interest and will
be entitled to receive, on each Distribution Date, the sum of the amounts
distributable on the Class III-C38c through Class III-C49c Interests on
such Distribution Date.
(9) The Class IV-I5 Interest will be an interest-only regular interest and will
be entitled to receive, on each Distribution Date, the sum of the amounts
distributable on the Class III-C50c through Class III-C62c Interests on
such Distribution Date.
(10) The Class R-IV Interest is the sole class of residual interest in REMIC IV.
The Class R-IV Interest does not have a principal amount or an interest
rate.
On each Distribution Date, 50% of the increase in the Subordinated
Amount will be payable as a reduction of the principal balances of the REMIC IV
Accretion Directed Classes and will be accrued and added to the principal
balance of the Class IV-Accrual Interest. To this end, each REMIC IV Accretion
Directed Class will be reduced by an amount equal to 50% of any increase in the
Subordinated Amount that is attributable to a reduction in the principal balance
of its Corresponding Class. On each Distribution Date, the increase in the
principal balance of the Class IV-Accrual Interest may not exceed interest
accruals for such Distribution Date for the Class IV-Accrual Interest. If, with
respect to any Distribution Date, 50% of the increase in the Subordinated Amount
exceeds accrued interest on the Class IV-Accrual Interest, the excess
(accumulated with all such excess for all prior Distribution Dates) will be
added to any increase in the Subordinated Amount for purposes of calculating
accrued interest on the Class IV-Accrual Interest payable as principal on the
REMIC IV Accretion Directed Classes on the next Distribution Date.
On each Distribution Date, all principal payments (scheduled and
prepaid) on the Mortgage Loans and any amounts transferred from the Pre-Funding
Account to REMIC I shall be allocated as follows: 50% to the Class IV-Accrual
Interest and 50% to the REMIC IV Accretion Directed Classes, until such
interests are paid in full. To this end, principal payments shall be allocated
among such REMIC IV Accretion Directed Classes in an amount equal to 50% of the
principal amounts allocated to their respective Corresponding Classes.
Notwithstanding the foregoing, principal payments allocated to the Class X
Certificates that result in the reduction in the Subordinated Amount shall be
allocated to the Class IV-Accrual Interest until paid in full. On each
Distribution Date, Realized Losses shall be applied so that after all
distributions have been made on each Distribution Date (i) the principal balance
of each REMIC IV Accretion Directed Class is equal to 50% of the principal
balance of its Corresponding Class, and (ii) the principal balance of the Class
IV-Accrual Interest is equal to 50% of the sum of (1) the Pool Stated Principal
Balance, (2) the Subordinated Amount and (3) the Pre-Funding Amount.
16
The REMIC V Regular Interests and the Class R-V Interest shall have
the following tier interest rate, initial tier principal amount, corresponding
classes, and latest possible maturity date as set forth in the table below.
TIER
REMIC V CLASS INTEREST INITIAL TIER PRINCIPAL LATEST POSSIBLE MATURITY
DESIGNATION RATE AMOUNT CORRESPONDING CLASS DATE
------------- -------- ---------------------- ------------------- ------------------------
Class A-1 (1) $306,010,000 Class A-1(8) May 25, 2037
Class A-2 (1) $102,870,000 Class A-2(8) May 25, 2037
Class A-3 (1) $133,770,000 Class A-3(8) May 25, 2037
Class A-4 (1) $ 92,155,000 Class A-4(8) May 25, 2037
Class M-1 (1) $ 32,993,000 Class M-1(8) May 25, 2037
Class M-2 (1) $ 24,645,000 Class M-2(8) May 25, 2037
Class M-3 (1) $ 15,503,000 Class M-3(8) May 25, 2037
Class M-4 (1) $ 13,118,000 Class M-4(8) May 25, 2037
Class M-5 (1) $ 12,720,000 Class M-5(8) May 25, 2037
Class M-6 (1) $ 11,528,000 Class M-6(8) May 25, 2037
Class B-1 (1) $ 11,130,000 Class B-1(8) May 25, 2037
Class B-2 (1) $ 7,950,000 Class B-2(8) May 25, 2037
Class B-3 (1) $ 5,963,000 Class B-3(8) May 25, 2037
Class B-4 (1) $ 7,950,000 Class B-4(8) May 25, 2037
Class X-1(7) (2) (2) Class X(9) May 25, 2037
Class X-2(7) (3) (4) Class X(9) May 25, 2037
Class V-I1 (5) (5) Class I-1 May 25, 2037
Class V-I2 (5) (5) Class I-2 May 25, 2037
Class V-I3 (5) (5) Class I-3 May 25, 2037
Class V-I4 (5) (5) Class I-4 May 25, 2037
Class V-I5 (5) (5) Class I-5 May 25, 2037
Class R-V (6) (6) Class R
(1) These Certificates will bear interest during each Interest Accrual Period
at a per annum variable rate equal to the least of (a) one-month LIBOR plus
the applicable Pass-Through Margin or (c) the REMIC Adjusted WAC Cap.
17
(2) The Class X-1 Interest has an initial principal balance of $16,694,900 but
it will not accrue interest on such balance but will accrue interest on a
notional principal balance. As of any Distribution Date, the Class X-1
Interest shall have a notional principal balance equal to the sum of (i)
the Pool Stated Principal Balance and (ii) any amount remaining in the
Pre-Funding Account as of the first day of the related Interest Accrual
Period. With respect to any Interest Accrual Period, the Class X-1 Interest
shall bear interest at a rate equal to the excess, if any, of the REMIC
Adjusted WAC Cap over the product of (i) 2 and (ii) the weighted average
interest rates of the REMIC IV Accretion Direction Classes and the Class
IV-Accrual Interest, where each REMIC IV Accretion Directed Class is
subject to a cap equal to the interest rate on its Corresponding REMIC V
Interest and the Class IV-Accrual Interest is subject to a cap of zero.
With respect to any Distribution Date, interest that so accrues on the
notional principal balance of the Class X-1 Interest shall be deferred in
an amount equal to any increase in the Subordinated Amount on such
Distribution Date. Such deferred interest shall not itself bear interest.
(3) The Class X-2 Interest is entitled to all distributions of interest on the
Class IV-N Interest.
(4) The Class X-2 Interest will have a notional principal balance equal to the
notional principal balance of the Class IV-N Interest.
(5) These REMIC V Regular Interests will be interest-only regular interests and
will be entitled to receive on each Distribution Date all distribution on
its corresponding REMIC IV Regular Interest for such Distribution Date.
(6) The Class R-V Interest is the sole class of residual interest in REMIC V.
The Class R-V Interest does not have a principal amount or an interest
rate.
(7) The Class X Certificates will represent two REMIC V Regular Interests, the
Class X-1 and Class X-2 Interests.
(8) Each of these Certificates will represent not only the ownership of the
Corresponding Class of REMIC V Regular Interest but also the right to
receive payments from the Excess Reserve Fund Account (including amounts in
respect of the Interest Rate Cap Agreement) and the Swap Account in respect
of any Basis Risk Carry Forward Amounts. For federal income tax purposes,
the Trustee will treat a Certificateholder's right to receive of Basis Risk
Carry Forward Amounts (including amounts in respect of the Interest Rate
Cap Agreement) as payments made pursuant to a notional principal contract
written by the Class X Certificateholders. Each of these Certificates will
also represent the obligation to make certain payments on such notional
principal contract to the extent that the interest accrued on its
Corresponding REMIC V Regular Interest is in excess of the related Accrued
Certificate Interest.
(9) The Class X Certificates also represent the right to receive payments from
the Interest Rate Swap Agreement, the Interest Rate Cap Agreement, the
Pre-Funding Reserve Account and certain payments from Holders of the LIBOR
Certificates as described in footnote 8 and the obligation to fund certain
Basis Risk Carry Forward Amounts.
18
Set forth below are designations of Classes of Certificates to the
categories used herein:
Book-Entry Certificates............ All Classes of Certificates other than the
Physical Certificates.
Delay Certificates................. None.
ERISA-Restricted Certificates...... Class B-4 Certificates, Class R
Certificates, Class P Certificate and
Class X Certificate; any certificate with
a rating below the lowest applicable
permitted rating under the Underwriters'
Exemption.
LIBOR Certificates................. Class A-1, Class A-2, Class A-3, Class A-4
and Subordinated Certificates.
Non-Delay Certificates............. Class A-1, Class A-2, Class A-3, Class
A-4, Class X and Subordinated
Certificates.
Offered Certificates............... All Classes of Certificates other than the
Private Certificates.
Physical Certificates.............. Class P, Class X and Class R Certificates.
Private Certificates............... Class B-4, Class P, Class X and Class R
Certificates.
Rating Agencies.................... Xxxxx'x, Fitch and Standard & Poor's.
Regular Certificates............... All Classes of Certificates other than the
Class P and Class R Certificates.
Residual Certificates.............. Class R Certificates.
Subordinated Certificates.......... Class M-1, Class M-2, Class M-3, Class
M-4, Class M-5, Class M-6, Class B-1,
Class B-2, Class B-3 and Class B-4
Certificates.
19
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
10-K Filing Deadline: As defined in Section 8.12(c).
60+ Day Delinquent Loan: Each Mortgage Loan with respect to which any
portion of a Scheduled Payment is, as of the last day of the prior Due Period,
two months or more past due (without giving effect to any grace period),
including Mortgage Loans related to REO Property.
Accepted Servicing Practices: With respect to the Servicer and any
Mortgage Loan, those mortgage servicing practices set forth in Section 3.01.
Account: Any of the Capitalized Interest Account, the Collection
Account, the Distribution Account, any Escrow Account, the Excess Reserve Fund
Account, the Swap Account, the Pre-Funding Account or the Pre-Funding Reserve
Account. Each Account shall be an Eligible Account.
Accredited: Accredited Home Lenders, Inc., a California corporation,
and its successors in interest.
Accredited Agreements: The Accredited Purchase Agreement and the
Accredited Assignment Agreement, copies of which are attached hereto as Exhibit
Y.
Accredited Assignment Agreement: The Assignment and Recognition
Agreement, dated as of January 30, 2007, by and among the Unaffiliated Seller,
the Depositor and Accredited, and each other Assignment and Recognition
Agreement, by and among the Unaffiliated Seller, the Depositor and Accredited in
connection with any Subsequent Transfer of Accredited Mortgage Loans.
Accredited Mortgage Loan: A Mortgage Loan which was acquired from
Accredited by the Unaffiliated Seller pursuant to the Accredited Purchase
Agreement, and which has been acquired by the Trust Fund.
Accredited Purchase Agreement: The Third Amended and Restated Mortgage
Loan Purchase and Warranties Agreement, dated as of August 1, 2006, as amended
to date, by and between the Unaffiliated Seller and Accredited.
Accrued Certificate Interest: With respect to any Distribution Date
for each Class of Certificates (other than the Class P, Class R and Class X
Certificates), the amount of interest accrued during the related Interest
Accrual Period at the applicable Pass-Through Rate on the related Class
Certificate Balance immediately prior to such Distribution Date, as reduced by
such Class's share of Net Prepayment Interest Shortfalls and Relief Act
Shortfalls for such Distribution Date allocated to such Class pursuant to
Section 4.02.
20
Additional Form 10-D Disclosure: As defined in Section 8.12(b).
Additional Form 10-K Disclosure: As defined in Section 8.12(c).
Addition Notice: A written notice from the Unaffiliated Seller to the
Trustee, the Rating Agencies and the Securities Administrator that the
Unaffiliated Seller desires to make a Subsequent Transfer.
Adjustable Rate Mortgage Loan: A Mortgage Loan bearing interest at an
adjustable rate.
Adjusted Mortgage Rate: As to each Mortgage Loan and at any time, the
per annum rate equal to the Mortgage Rate less the Servicing Fee Rate.
Adjusted Net Mortgage Rate: As to each Mortgage Loan and at any time,
the per annum rate equal to the Mortgage Rate less the Expense Fee Rate.
Adjustment Date: As to any Adjustable Rate Mortgage Loan, the first
Due Date on which the related Mortgage Rate adjusts as set forth in the related
Mortgage Note and each Due Date thereafter on which the Mortgage Rate adjusts as
set forth in the related Mortgage Note.
Advances: Collectively, the P&I Advances and Servicing Advances.
Advance Facility: As defined in Section 3.27.
Advance Facility Notice: As defined in Section 3.27.
Advance Facility Termination Notice: As defined in Section 3.27.
Advance Reimbursement Amount: As defined in Section 3.27.
Advancing Person: As defined in Section 3.27.
Affiliate: With respect to any Person, any other Person controlling,
controlled by or under common control with such first Person. For the purposes
of this definition, "control" means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agreement: This Pooling and Servicing Agreement and all amendments or
supplements hereto.
Amount Held for Future Distribution: As to the Certificates on any
Distribution Date, the aggregate amount held in each Collection Account at the
close of business on the related Determination Date on account of (i) Principal
Prepayments, Insurance Proceeds, Condemnation Proceeds and Liquidation Proceeds
on the Mortgage Loans received after the end
21
of the related Prepayment Period and (ii) all Scheduled Payments on the Mortgage
Loans due after the end of the related Due Period.
Analytics Company: Intex Solutions, Inc., or any other bond analytics
service provider identified to the Securities Administrator by the Depositor.
Applied Realized Loss Amount: With respect to any Distribution Date,
the amount, if any, by which the aggregate Class Certificate Balance of the
LIBOR Certificates after distributions of principal on such Distribution Date
exceeds the aggregate Stated Principal Balance of the Mortgage Loans for such
Distribution Date.
Appraised Value: The value set forth in an appraisal made in
connection with the origination of the related Mortgage Loan as the value of the
Mortgaged Property.
Assignment and Recognition Agreement: The Accredited Assignment
Agreement, the CIT Assignment Agreement, the First Bank Assignment Agreement,
the First Horizon Assignment Agreement, the First NLC Assignment Agreement, the
FlexPoint Assignment Agreement, the Funding America Assignment Agreement, the
Lenders Direct Assignment Agreement, the Lime Financial Assignment Agreement,
the Mandalay Assignment Agreement, the Master Financial Assignment Agreement,
the Maxim Assignment Agreement, the NC Capital Assignment Agreement, the Quick
Loan Assignment Agreement, the Platinum Assignment Agreement, the Rose
Assignment Agreement or the Sebring Assignment Agreement, as applicable.
Assignment of Mortgage: An assignment of the Mortgage, notice of
transfer or equivalent instrument in recordable form (other than the assignee's
name and recording information not yet returned from the recording office),
reflecting the sale of the Mortgage to the Trustee.
Available Funds: With respect to any Distribution Date and the
Mortgage Loans, to the extent received by the Securities Administrator (x) the
sum of (i) the aggregate amount of Scheduled Payments on the Mortgage Loans due
on the related Due Date (net of the related Expense Fees) and received by the
Servicer on or prior to the related Determination Date, together with any P&I
Advance in respect thereof, (ii) certain unscheduled payments in respect of the
Mortgage Loans received by the Servicer during the related Prepayment Period and
remitted to the Master Servicer, including all partial or full prepayments,
Insurance Proceeds, Condemnation Proceeds, Liquidation Proceeds (excluding
Prepayment Charges), (iii) Compensating Interest payments from the Servicer to
the Master Servicer in respect of Prepayment Interest Shortfalls for that
Distribution Date, (iv) for any Distribution Date on or prior to April 25, 2007,
any funds required to be paid from the Capitalized Interest Account to make up
for any interest shortfalls on the Initial Mortgage Loans, (v) immediately
following the end of the Pre-Funding Period, all amounts, if any, on deposit in
the Pre-Funding Account, (vi) the proceeds from repurchases of Mortgage Loans,
and any Substitution Adjustment Amounts received in connection with respect to
the substitutions of Mortgage Loans that occur during the month in which such
Distribution Date occurs at the Repurchase Price and (vii) all proceeds received
with respect to the termination of the Trust Fund pursuant to Section 11.01
hereof, reduced by (y) amounts in reimbursement for Advances previously made
with respect to the
22
Mortgage Loans and other amounts, in each case, as to which the Master Servicer,
the Securities Administrator, the Servicer, the Depositor, the Custodian or the
Trustee are entitled to be paid or reimbursed pursuant to this Agreement and any
costs associated with a transfer of servicing to the extent not paid by the
predecessor servicer.
Balloon Loan: Any Mortgage Loan that requires only payments of
interest until the stated maturity date of the Mortgage Loan or Scheduled
Payments of principal which (not including the payment due on its stated
maturity date) are based on an amortization schedule that would be insufficient
to fully amortize the principal thereof by the stated maturity date of the
Mortgage Loan.
Basic Principal Distribution Amount: With respect to any Distribution
Date, the excess of (i) the aggregate Principal Remittance Amount for such
Distribution Date over (ii) the sum of the Excess Subordinated Amount, if any,
for such Distribution Date and any Net Swap Payment to the extent not covered by
the Interest Remittance Amount.
Basis Risk Carry Forward Amount: With respect to each Class of LIBOR
Certificates, as of any Distribution Date, the sum of (A) if on such
Distribution Date the Pass-Through Rate for any Class of LIBOR Certificates is
based upon the WAC Cap, the excess of (i) the amount of interest such Class of
Certificates would otherwise be entitled to receive on such Distribution Date
had such rate been calculated as the sum of LIBOR and the applicable
Pass-Through Margin on such Class of Certificates for such Distribution Date,
over (ii) the amount of interest payable on such Class of Certificates
calculated at the WAC Cap for such Distribution Date and (B) the Basis Risk
Carry Forward Amount for such Class of Certificates for all previous
Distribution Dates not previously paid, together with interest thereon at a rate
equal to the sum of LIBOR and the applicable Pass-Through Margin for such Class
of Certificates for such Distribution Date. For federal income tax purposes,
with respect to each Class of LIBOR Certificates, as of any Distribution Date,
the sum of (A) if on such Distribution Date, the interest rate for any
Corresponding REMIC V Regular Interest is based upon the REMIC Adjusted WAC Cap,
the excess of (i) the amount of interest such Class of Certificates would
otherwise be entitled to receive on such Distribution Date had such rate been
calculated as the sum of LIBOR and the applicable Pass-Through Margin on such
Class of Certificates for such Distribution Date, over (ii) the amount of
interest payable on such REMIC V Regular Interest calculated at the REMIC
Adjusted WAC Cap for such Distribution Date and (B) the Basis Risk Carry Forward
Amount for such Class of Certificates for all previous Distribution Dates not
previously paid, together with interest thereon at a rate equal to the sum of
LIBOR and the applicable Pass-Through Margin for such Class of Certificates for
such Distribution Date.
Basis Risk Payment: For any Distribution Date, a payment in an amount
equal to any Basis Risk Carry Forward Amount; provided, however, that with
respect to any Distribution Date, the payment cannot exceed the amounts
otherwise available for distribution on the Class X Certificates (prior to any
reduction for (x) amounts paid from the Excess Reserve Fund Account to pay any
Basis Risk Carry Forward Amount or (y) any Defaulted Swap Termination Payment).
Best's: Best's Key Rating Guide, as the same shall be amended from
time to time.
Book-Entry Certificates: As specified in the Preliminary Statement.
23
Business Day: Any day other than (i) Saturday or Sunday, or (ii) a day
on which banking and savings and loan institutions, in (a) the States of
California, Minnesota, New York, Utah, New Jersey and Florida, (b) the
applicable states in which the Servicer's servicing operations are located, (c)
the State in which the Securities Administrator's or Master Servicer's
operations are located or (d) the State in which the Custodian's operations are
located, are authorized or obligated by law or executive order to be closed.
Cap Provider: IXIS Financial Products Inc., a Delaware corporation,
and any successor thereto.
Capitalized Interest Account: The separate Eligible Account created
and maintained by the Securities Administrator pursuant to Section 3.07(e) in
the name of the Securities Administrator for the benefit of the LIBOR
Certificateholders and designated "Xxxxx Fargo Bank, National Association, in
trust for registered holders of IXIS Real Estate Capital Trust 2007-HE1,
Mortgage Pass-Through Certificates, Series 2007-HE1".
Capitalized Interest Requirement: With respect to the Distribution
Dates occurring in February 2007, March 2007 or April 2007, the excess, if any,
of (x) the Accrued Certificate Interests for all classes of the LIBOR
Certificates for such Distribution Date over (y) all scheduled installments of
interest (net of the related Expense Fees) due on the Mortgage Loans in the
related Due Period. In no event will the Capitalized Interest Requirement be
less than zero.
Certificate: Any one of the Certificates executed by the Securities
Administrator in substantially the forms attached hereto as exhibits.
Certificate Balance: With respect to any Class of Certificates, other
than the Class X and Class R Certificates, at any date, the maximum dollar
amount of principal to which the Holder thereof is then entitled hereunder, such
amount being equal to the Denomination thereof minus all distributions of
principal previously made with respect thereto and in the case of any
Certificates, reduced by any Applied Realized Loss Amounts allocated to such
Class of Certificates pursuant to Section 4.07; provided, however, that
immediately following the Distribution Date on which a Subsequent Recovery is
distributed, the Class Certificate Balances of any Class or Classes of
Certificates that have been previously reduced by Applied Realized Loss Amounts
will be increased, in order of seniority, by the amount of the Subsequent
Recovery distributed on such Distribution Date (up to the amount of Unpaid
Realized Loss Amounts for such Class or Classes for such Distribution Date);
provided, that the Certificate Balance of any Class of Certificates that had
previously been reduced to zero shall not be increased as a result of any
Subsequent Recoveries. The Class X and Class R Certificates have no Certificate
Balance.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Book-Entry Certificate.
Certificate Register: The register maintained pursuant to Section
5.02.
Certificateholder or Holder: The person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purpose of
giving any consent pursuant to
24
this Agreement, any Certificate registered in the name of the Unaffiliated
Seller, Depositor or any of their respective Affiliates shall be deemed not to
be Outstanding and the Percentage Interest evidenced thereby shall not be taken
into account in determining whether the requisite amount of Percentage Interests
necessary to effect such consent has been obtained; provided, however, that if
the Unaffiliated Seller (together with its Affiliates) or the Depositor
(together with its Affiliates) owns 100% of the Percentage Interests evidenced
by a Class of Certificates, such Certificates shall be deemed to be Outstanding
for the purposes of any provision hereof that requires the consent of the
Holders of Certificates of a particular Class as a condition to the taking of
any action hereunder. The Securities Administrator is entitled to rely
conclusively on a certification of the Unaffiliated Seller, the Depositor or any
such Affiliate in determining which Certificates are registered in the name of
an Affiliate of Unaffiliated Seller or the Depositor.
Charge-off Date: As defined in Section 3.07(o).
CIT: The CIT Group/Consumer Finance Inc., a New York Corporation (and
its Affiliates and their respective successors in interest),.
CIT Agreements: The CIT Purchase Agreement and the CIT Assignment
Agreement, copies of which are attached hereto as Exhibit Z.
CIT Assignment Agreement: The Assignment and Recognition Agreement,
dated as of January 30, 2007, by and among the Unaffiliated Seller, the
Depositor and CIT, and each other Assignment and Recognition Agreement by and
among the Unaffiliated Seller, the Depositor and CIT in connection with any
Subsequent Transfer of CIT Mortgage Loans.
CIT Mortgage Loan: A Mortgage Loan which was acquired from CIT by the
Unaffiliated Seller pursuant to the CIT Purchase Agreement, and which has been
acquired by the Trust Fund.
CIT Purchase Agreement: The Amended and Restated Mortgage Loan
Purchase and Warranties Agreement, dated as of January 1, 2007 as amended to
date, by and between the Unaffiliated Seller and CIT.
Class: All Certificates bearing the same class designation as set
forth in the Preliminary Statement.
Class A Certificates: The Class A-1, Class A-2, Class A-3 and Class
A-4 Certificates.
Class A Principal Distribution Amount: With respect to any
Distribution Date, an amount equal to the excess of (x) the aggregate Class
Certificate Balances of the Class A Certificates immediately prior to such
Distribution Date over (y) the lesser of (A) 59.70% of the Current Maximum
Amount and (B) the excess, if any, of the Current Maximum Amount over
$3,975,000.
Class A-1 Certificates: All Certificates bearing the class designation
of "Class A-1."
25
Class A-2 Certificates: All Certificates bearing the class designation
of "Class A-2."
Class A-3 Certificates: All Certificates bearing the class designation
of "Class A-3."
Class A-4 Certificates: All Certificates bearing the class designation
of "Class A-4."
Class B Certificates: The Class B-1, Class B-2, Class B-3 and Class
B-4 Certificates.
Class B-1 Certificates: All Certificates bearing the class designation
of "Class B-1."
Class B-1 Principal Distribution Amount: With respect to any
Distribution Date, an amount equal to the excess of (i) the sum of (A) the
aggregate Class Certificate Balances of the Class A Certificates (after taking
into account the distribution of the Class A Principal Distribution Amount on
such Distribution Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount on such Distribution Date), (C) the Class
Certificate Balance of the Class M-2 Certificates (after taking into account the
distribution of the Class M-2 Principal Distribution Amount on such Distribution
Date), (D) the Class Certificate Balance of the Class M-3 Certificates (after
taking into account the distribution of the Class M-3 Principal Distribution
Amount on such Distribution Date), (E) the Class Certificate Balance of the
Class M-4 Certificates (after taking into account the distribution of the Class
M-4 Principal Distribution Amount on such Distribution Date), (F) the Class
Certificate Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount on such Distribution
Date), (G) the Class Certificate Balance of the Class M-6 Certificates (after
taking into account the distribution of the Class M-6 Principal Distribution
Amount on such Distribution Date), and (H) the Class Certificate Balance of the
Class B-1 Certificates immediately prior to such Distribution Date over (ii) the
lesser of (A) 90.30% of the Current Maximum Amount and (B) the excess, if any,
of the Current Maximum Amount over $3,975,000.
Class B-2 Certificates: All Certificates bearing the class designation
of "Class B-2".
Class B-2 Principal Distribution Amount: With respect to any
Distribution Date, an amount equal to the excess of (i) the sum of (A) the
aggregate Class Certificate Balances of the Class A Certificates (after taking
into account the distribution of the Class A Principal Distribution Amount on
such Distribution Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount on such Distribution Date), (C) the Class
Certificate Balance of the Class M-2 Certificates (after taking into account the
distribution of the Class M-2 Principal Distribution Amount on such Distribution
Date), (D) the Class Certificate Balance of the Class M-3 Certificates (after
taking into account the distribution of the Class M-3 Principal
26
Distribution Amount on such Distribution Date), (E) the Class Certificate
Balance of the Class M-4 Certificates (after taking into account the
distribution of the Class M-4 Principal Distribution Amount on such Distribution
Date), (F) the Class Certificate Balance of the Class M-5 Certificates (after
taking into account the distribution of the Class M-5 Principal Distribution
Amount on such Distribution Date), (G) the Class Certificate Balance of the
Class M-6 Certificates (after taking into account the distribution of the Class
M-6 Principal Distribution Amount on such Distribution Date), (H) the Class
Certificate Balance of the Class B-1 Certificates (after taking into account the
distribution of the Class B-1 Principal Distribution Amount on such Distribution
Date), and (I) the Class Certificate Balance of the Class B-2 Certificates
immediately prior to such Distribution Date over (ii) the lesser of (A) 92.30%
of the Current Maximum Amount and (B) the excess, if any, of the Current Maximum
Amount over $3,975,000.
Class B-3 Certificates: All Certificates bearing the class designation
of "Class B-3".
Class B-3 Principal Distribution Amount: With respect to any
Distribution Date, an amount equal to the excess of (i) the sum of (A) the
aggregate Class Certificate Balances of the Class A Certificates (after taking
into account the distribution of the Class A Principal Distribution Amount on
such Distribution Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount on such Distribution Date), (C) the Class
Certificate Balance of the Class M-2 Certificates (after taking into account the
distribution of the Class M-2 Principal Distribution Amount on such Distribution
Date), (D) the Class Certificate Balance of the Class M-3 Certificates (after
taking into account the distribution of the Class M-3 Principal Distribution
Amount on such Distribution Date), (E) the Class Certificate Balance of the
Class M-4 Certificates (after taking into account the distribution of the Class
M-4 Principal Distribution Amount on such Distribution Date), (F) the Class
Certificate Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount on such Distribution
Date), (G) the Class Certificate Balance of the Class M-6 Certificates (after
taking into account the distribution of the Class M-6 Principal Distribution
Amount on such Distribution Date), (H) the Class Certificate Balance of the
Class B-1 Certificates (after taking into account the distribution of the Class
B-1 Principal Distribution Amount on such Distribution Date), (I) the Class
Certificate Balance of the Class B-2 Certificates (after taking into account the
distribution of the Class B-2 Principal Distribution Amount on such Distribution
Date), and (J) the Class Certificate Balance of the Class B-3 Certificates
immediately prior to such Distribution Date over (ii) the lesser of (A) 93.80%
of the Current Maximum Amount and (B) the excess, if any, of the Current Maximum
Amount over $3,975,000.
Class B-4 Certificates: All Certificates bearing the class designation
of "Class B-4".
Class B-4 Principal Distribution Amount: With respect to any
Distribution Date, an amount equal to the excess of (i) the sum of (A) the
aggregate Class Certificate Balances of the Class A Certificates (after taking
into account the distribution of the Class A Principal Distribution Amount on
such Distribution Date), (B) the Class Certificate Balance of the Class
27
M-1 Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount on such Distribution Date), (C) the Class
Certificate Balance of the Class M-2 Certificates (after taking into account the
distribution of the Class M-2 Principal Distribution Amount on such Distribution
Date), (D) the Class Certificate Balance of the Class M-3 Certificates (after
taking into account the distribution of the Class M-3 Principal Distribution
Amount on such Distribution Date), (E) the Class Certificate Balance of the
Class M-4 Certificates (after taking into account the distribution of the Class
M-4 Principal Distribution Amount on such Distribution Date), (F) the Class
Certificate Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount on such Distribution
Date), (G) the Class Certificate Balance of the Class M-6 Certificates (after
taking into account the distribution of the Class M-6 Principal Distribution
Amount on such Distribution Date), (H) the Class Certificate Balance of the
Class B-1 Certificates (after taking into account the distribution of the Class
B-1 Principal Distribution Amount on such Distribution Date), (I) the Class
Certificate Balance of the Class B-2 Certificates (after taking into account the
distribution of the Class B-2 Principal Distribution Amount on such Distribution
Date), (J) the Class Certificate Balance of the Class B-3 Certificates (after
taking into account the distribution of the Class B-3 Principal Distribution
Amount on such Distribution Date), and (K) the Class Certificate Balance of the
Class B-4 Certificates immediately prior to such Distribution Date over (ii) the
lesser of (A) approximately 95.80% of the Current Maximum Amount and (B) the
excess, if any, of the Current Maximum Amount over approximately $3,975,000.
Class Certificate Balance: With respect to any Class and as to any
date of determination, the aggregate of the Certificate Balances of all
Certificates of such Class as of such date.
Class I Interests: As described in the Preliminary Statement.
Class M Certificates: The Class M-1, Class M-2, Class M-3, Class M-4,
Class M-5 and Class M-6 Certificates.
Class M-1 Certificates: All Certificates bearing the class designation
of "Class M-1".
Class M-1 Enhancement Percentage: With respect to any Distribution
Date, the percentage obtained by dividing (x) the sum of (i) the aggregate Class
Certificate Balance of the Class M-2, Class M-3, Class M-4, Class M-5, Class
M-6, Class B-1, Class B-2, Class B-3, Class B-4 Certificates and (ii) the
Subordinated Amount (in each case after taking into account the allocation of
the Principal Distribution Amount and any principal payments on those classes of
certificates from the Swap Account for such Distribution Date) by (y) the
Current Maximum Amount for that Distribution Date.
Class M-1 Principal Distribution Amount: With respect to any
Distribution Date, an amount equal to the excess of (i) the sum of (A) the
aggregate Class Certificate Balances of the Class A Certificates (after taking
into account the distribution of the Class A Principal Distribution Amount on
such Distribution Date) and (B) the Class Certificate Balance of the Class M-1
Certificates immediately prior to such Distribution Date over (ii) the lesser of
(A)
28
68.00% of the Current Maximum Amount and (B) the excess, if any, of the Current
Maximum Amount over $3,975,000.
Class M-2 Certificates: All Certificates bearing the class designation
of "Class M-2."
Class M-2 Principal Distribution Amount: With respect to any
Distribution Date, an amount equal to the excess of (i) the sum of (A) the
aggregate Class Certificate Balances of the Class A Certificates (after taking
into account the distribution of the Class A Principal Distribution Amount on
such Distribution Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount on such Distribution Date) and (C) the Class
Certificate Balance of the Class M-2 Certificates immediately prior to such
Distribution Date over (ii) the lesser of (A) 74.20% of the Current Maximum
Amount and (B) the excess, if any, of the Current Maximum Amount over
$3,975,000.
Class M-3 Certificates: All Certificates bearing the class designation
of "Class M-3".
Class M-3 Principal Distribution Amount: With respect to any
Distribution Date, an amount equal to the excess of (i) the sum of (A) the
aggregate Class Certificate Balances of the Class A Certificates (after taking
into account the distribution of the Class A Principal Distribution Amount on
such Distribution Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount on such Distribution Date), (C) the Class
Certificate Balance of the Class M-2 Certificates (after taking into account the
distribution of the Class M-2 Principal Distribution Amount on such Distribution
Date), and (D) the Class Certificate Balance of the Class M-3 Certificates
immediately prior to such Distribution Date over (ii) the lesser of (A) 78.10%
of the Current Maximum Amount and (B) the excess, if any, of the Current Maximum
Amount over $3,975,000.
Class M-4 Certificates: All Certificates bearing the class designation
of "Class M-4".
Class M-4 Principal Distribution Amount: With respect to any
Distribution Date, an amount equal to the excess of (i) the sum of (A) the
aggregate Class Certificate Balances of the Class A Certificates (after taking
into account the distribution of the Class A Principal Distribution Amount on
such Distribution Date), (B) the Class Certificate Balances of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount on such Distribution Date), (C) the Class
Certificate Balances of the Class M-2 Certificates (after taking into account
the distribution of the Class M-2 Principal Distribution Amount on such
Distribution Date), (D) the Class Certificate Balances of the Class M-3
Certificates (after taking into account the distribution of the Class M-3
Principal Distribution Amount on such Distribution Date) and (E) the Class
Certificate Balances of the Class M-4 Certificates immediately prior to such
Distribution Date over (ii) the lesser of (A) 81.40% of the Current Maximum
Amount and (B) the excess, if any, of the Current Maximum Amount over
$3,975,000.
29
Class M-5 Certificates: All Certificates bearing the class designation
of "Class M-5".
Class M-5 Principal Distribution Amount: With respect to any
Distribution Date, an amount equal to the excess of (i) the sum of (A) aggregate
Class Certificate Balances of the Class A Certificates (after taking into
account the distribution of the Class A Principal Distribution Amount on such
Distribution Date), (B) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount on such Distribution Date), (C) the Certificate
Principal Balance of the Class M-2 Certificates (after taking into account the
distribution of the Class M-2 Principal Distribution Amount on such Distribution
Date), (D) the Certificate Principal Balance of the Class M-3 Certificates
(after taking into account the distribution of the Class M-3 Principal
Distribution Amount on such Distribution Date), (E) the Certificate Principal
Balance of the Class M-4 Certificates (after taking into account the
distribution of the Class M-4 Principal Distribution Amount on such Distribution
Date) and (F) the Certificate Principal Balance of the Class M-5 Certificates
immediately prior to such Distribution Date over (i) the lesser of (A) 84.60% of
the Current Maximum Amount and (B) the excess, if any, of the Current Maximum
Amount over $3,975,000.
Class M-6 Certificates: All Certificates bearing the class designation
of "Class M-6".
Class M-6 Principal Distribution Amount: With respect to any
Distribution Date, an amount equal to the excess of (i) the sum of (A) the
aggregate Class Certificate Balances of the Class A Certificates (after taking
into account the distribution of the Class A Principal Distribution Amount on
such Distribution Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount on such Distribution Date), (C) the Class
Certificate Balance of the Class M-2 Certificates (after taking into account the
distribution of the Class M-2 Principal Distribution Amount on such Distribution
Date), (D) the Class Certificate Balance of the Class M-3 Certificates (after
taking into account the distribution of the Class M-3 Principal Distribution
Amount on such Distribution Date), (E) the Class Certificate Balance of the
Class M-4 Certificates (after taking into account the distribution of the Class
M-4 Principal Distribution Amount on such Distribution Date), (F) the Class
Certificate Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount on such Distribution
Date) and (G) the Class Certificate Balance of the Class M-6 Certificates
immediately prior to such Distribution Date over (ii) the lesser of (A) 87.50%
of the Current Maximum Amount and (B) the excess, if any, of the Current Maximum
Amount over $3,975,000.
Class P Certificates: All Certificates bearing the class designation
of "Class P".
Class R Certificates: All Certificates bearing the class designation
of "Class R".
Class X Certificates: All Certificates bearing the class designation
of "Class X".
30
Class X Distributable Amount: On any Distribution Date, the sum of (i)
as a distribution in respect of interest, the amount of interest that has
accrued on the Class X Regular Interests and not applied as an Extra Principal
Distribution Amount on such Distribution Date, plus any such accrued interest
remaining undistributed from prior Distribution Dates, plus, without
duplication, (ii) as a distribution in respect of principal, any portion of the
principal balance of the Class X Regular Interest which is distributable as a
Subordination Reduction Amount, less (iii) any amounts paid as a Basis Risk
Payment and any Defaulted Swap Termination Payment that is not a Senior Swap
Termination Payment.
Class X Regular Interest: The REMIC V Regular Interests represented by
the Class X Certificates as specified and described in the Preliminary Statement
and the related footnote thereto.
Closing Date: January 30, 2007.
Code: The Internal Revenue Code of 1986, including any successor or
amendatory provisions.
Collection Accounts: As defined in Section 3.10(a).
Commission: The United States Securities and Exchange Commission.
Compensating Interest: For any Distribution Date, the lesser of (a)
the amount by which the Prepayment Interest Shortfall, if any, for such
Distribution Date exceeds all Prepayment Interest Excesses for such Distribution
Date, with respect to voluntary Principal Prepayments in Full (excluding any
payments made upon liquidation of the Mortgage Loan) and (b) the Servicing Fee
payable to the Servicer for such Distribution Date.
Condemnation Proceeds: All awards of settlements in respect of a
Mortgaged Property, whether permanent or temporary, partial or entire, by
exercise of the power of eminent domain or condemnation.
Corporate Trust Office: With respect to the Securities Administrator
(i) for the transfer, presentation or surrender of Certificates, the office at
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000, Attention:
Corporate Trust Services - IXIS 2007-HE1, and (ii) for all other purposes 0000
Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust
Services IXIS 2007-HE1. The designated office in the State of California at
which at any particular time the Trustee's corporate trust business with respect
to this Agreement is administered, which office at the date of the execution of
this Agreement is located at 0000 Xxxx Xx. Xxxxxx Xxxxx, Xxxxx Xxx, Xxxxxxxxxx
00000, Attn: Trust Administration IX0701, facsimile no. (000) 000-0000 and which
is the address to which notices to and correspondence with the Trustee should be
directed.
Corresponding Class: As described in the Preliminary Statement.
Corresponding Distribution Date:
31
REMIC III Regular Corresponding Distribution Date is the
Interest Distribution Date occurring in:
----------------- --------------------------------------
Class III-C1a-c December 2007
Class III-C2a-c January 2008
Class III-C3a-c February 2008
Class III-C4a-c March 2008
Class III-C5a-c April 2008
Class III-C6a-c May 2008
Class III-C7a-c June 2008
Class III-C8a-c July 2008
Class III-C9a-c August 2008
Class III-C10a-c September 2008
Class III-C11a-c October 2008
Class III-C12a-c November 2008
Class III-C13a-c December 2008
Class III-C14a-c January 2009
Class III-C15a-c February 2009
Class III-C16a-c March 2009
Class III-C17a-c April 2009
Class III-C18a-c May 2009
Class III-C19a-c June 2009
Class III-C20a-c July 2009
Class III-C21a-c August 2009
Class III-C22a-c September 2009
Class III-C23a-c October 2009
32
Class III-C24a-c November 2009
Class III-C25a-c December 2009
Class III-C26a-c January 2010
Class III-C27a-c February 2010
Class III-C28a-c March 2010
Class III-C29a-c April 2010
Class III-C30a-c May 2010
Class III-C31a-c June 2010
Class III-C32a-c July 2010
Class III-C33a-c August 2010
Class III-C34a-c September 2010
Class III-C35a-c October 2010
Class III-C36a-c November 2010
Class III-C37a-c December 2010
Class III-C38a-c January 2011
Class III-C39a-c February 2011
Class III-C40a-c March 2011
Class III-C41a-c April 2011
Class III-C42a-c May 2011
Class III-C43a-c June 2011
Class III-C44a-c July 2011
Class III-C45a-c August 2011
Class III-C46a-c September 2011
Class III-C47a-c October 2011
33
Class III-C48a-c November 2011
Class III-C49a-c December 2011
Class III-C50a-c January 2012
Class III-C51a-c February 2012
Class III-C52a-c March 2012
Class III-C53a-c April 2012
Class III-C54a-c May 2012
Class III-C55a-c June 2012
Class III-C56a-c July 2012
Class III-C57a-c August 2012
Class III-C58a-c September 2012
Class III-C59a-c October 2012
Class III-C60a-c November 2012
Class III-C61a-c December 2012
Class III-C62a-c January 2013
Corresponding REMIC V Interest: As described in the Preliminary
Statement.
Covered Loan: A Mortgage Loan categorized as Covered pursuant to
Appendix E of Standard and Poor's Glossary.
Cumulative Loss Percentage: With respect to any Distribution Date, the
percentage equivalent of a fraction, the numerator of which is the aggregate
amount of Realized Losses incurred from the Cut-off Date through the last day of
the related Prepayment Period and the denominator of which is the Cut-off Date
Pool Principal Balance of the Mortgage Loans.
Cumulative Loss Trigger Event: With respect to any Distribution Date,
a Cumulative Loss Trigger Event exists if the quotient (expressed as a
percentage) of the aggregate amount of Realized Losses incurred since the
related Cut-off Date through the last day of the related Prepayment Period
divided by the Maximum Pool Principal Balance exceeds the applicable cumulative
loss percentage as follows with respect to such Distribution Date:
DISTRIBUTION DATE OCCURRING IN CUMULATIVE LOSS PERCENTAGE
---------------------------------- --------------------------------------------------------------------
February 2009 through January 2010 1.450% for the first month, plus an additional 1/12th of 1.750% for
each month thereafter (e.g., 2.325% in August 2009)
February 2010 through January 2011 3.200% for the first month, plus an additional 1/12th of 1.800% for
each month thereafter (e.g., 4.100% in August 2010)
February 2011 through January 2012 5.000% for the first month, plus an additional 1/12th of 1.500% for
each month thereafter (e.g., 5.750% in August 2011)
February 2012 through January 2013 6.500% for the first month, plus an additional 1/12th of 0.750% for
each month thereafter (e.g., 6.875% in August 2012)
February 2013 through January 2014 7.250% for the first month, plus an additional 1/12th of 0.050% for
each month thereafter (e.g., 7.275% in August 2013)
February 2014 and thereafter 7.300%
34
Current Maximum Amount: With respect to any date of determination, the
sum of (i) the aggregate of the Stated Principal Balances of the Mortgage Loans
held by the Trust at such time, and (ii) with respect to each date of
determination prior to the Distribution Date on or prior to April 25, 2007, the
Pre-Funding Amount immediately prior to such Distribution Date, net of
investment earnings on deposit therein.
Custodian: Deutsche Bank National Trust Company, a national banking
association, and its successors in interest.
Custodial File: With respect to each Mortgage Loan, the file retained
by the Custodian consisting of items (i) - (viii) of Section 2.01(b).
Cut-off Date: With respect to the Initial Mortgage Loans, January 1,
2007, and with respect to each Subsequent Mortgage Loan, the related Subsequent
Cut-off Date.
Cut-off Date Pool Principal Balance: The aggregate Stated Principal
Balances of all Mortgage Loans as of the Cut-off Date (after giving effect to
payments of principal due on that date, whether or not received).
Cut-off Date Principal Balance: As to any Mortgage Loan, the Stated
Principal Balance thereof as of the close of business on the Cut-off Date.
Data Tape Information: The information provided by the Unaffiliated
Seller as of January 1, 2007 to the Depositor setting forth the following
information with respect to each Mortgage Loan: (1) the Mortgagor's name; (2) as
to each Mortgage Loan, the Scheduled Principal Balance as of the Cut-off Date;
(3) the Mortgage Rate Cap; (4) the Index; (5) a code indicating whether the
Mortgaged Property is owner-occupied; (6) the type of Mortgaged Property; (7)
the first date on which the Scheduled Payment was due on the Mortgage Loan and,
if such date is not consistent with the Due Date currently in effect, such Due
Date; (8) the "paid through date" based on payments received from the related
Mortgagor; (9) the original principal amount of the Mortgage Loan; (10) with
respect to Adjustable Rate Mortgage Loans, the Maximum Mortgage Rate; (11) the
type of Mortgage Loan (i.e., Fixed Rate Mortgage Loan, Adjustable Rate Mortgage
Loan, First Lien Mortgage Loan or Second Lien Mortgage Loan); (12) a code
indicating the purpose of the loan (i.e., purchase, rate and term refinance,
equity take-out refinance); (13) a code indicating the documentation style
(i.e., full, asset verification, income verification and no documentation); (14)
the credit risk score (FICO score); (15) the loan credit grade classification
(as described in the Underwriting Guidelines); (16) with respect to each
Adjustable Rate Mortgage Loan, the Minimum Mortgage Rate; (17) the Mortgage Rate
at origination; (18) with respect to each Adjustable Rate Mortgage Loan, the
first Adjustment Date immediately following the Cut-off Date; (19) the value of
the Mortgaged Property; (20) a code indicating the type and term of Prepayment
Charges applicable to such Mortgage Loan, if any; and (21) with respect to each
Adjustable Rate Mortgage Loan, the Periodic Mortgage Rate Cap. With respect to
the Mortgage Loans in the aggregate, the Data Tape Information shall set forth
the following information, as of the Cut-off Date: (1) the number of Mortgage
Loans; (2) the current aggregate outstanding principal balance of the Mortgage
Loans; (3) the weighted average Mortgage Rate of the Mortgage Loans; and (4) the
weighted average maturity of the Mortgage Loans.
35
Debt Service Reduction: With respect to any Mortgage Loan, a reduction
by a court of competent jurisdiction in a proceeding under the United States
Bankruptcy Code in the Scheduled Payment for such Mortgage Loan which became
final and non-appealable, except such a reduction resulting from a Deficient
Valuation or any reduction that results in a permanent forgiveness of principal.
Defaulted Swap Termination Payment: Any termination payment required
to be made by the Trust to the Swap Provider pursuant to the Interest Rate Swap
Agreement as a result of: either (i) an event of default under the Interest Rate
Swap Agreement with respect to which the Swap Provider is the defaulting party
or (ii) an additional termination event or a tax event upon merger under the
Interest Rate Swap Agreement with respect to which the Swap Provider is the sole
affected party.
Deficiency Collection: As defined in Section 3.07(o).
Deficiency Collection Agent: As defined in Section 3.07(o).
Deficient Valuation: With respect to any Mortgage Loan, a valuation of
the related Mortgaged Property by a court of competent jurisdiction in an amount
less than the then- outstanding principal balance of the Mortgage Loan, which
valuation results from a proceeding initiated under the United States Bankruptcy
Code.
Definitive Certificates: Any Certificate evidenced by a Physical
Certificate and any Certificate issued in lieu of a Book-Entry Certificate
pursuant to Section 5.02(e).
Delay Certificates: As specified in the Preliminary Statement.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased by the
Unaffiliated Seller or the related Originator, as applicable, or replaced with a
Substitute Mortgage Loan in accordance with the terms hereof and the related
Mortgage Loan Purchase Agreement.
Delinquency Trigger Event: With respect to a Distribution Date after
the Stepdown Date, the event that is in effect if the quotient (expressed as a
percentage) of (x) the three-month rolling daily average of the aggregate Stated
Principal Balance of 60+ Day Delinquent Loans as of the last day of the related
Due Period, over (y) the Current Maximum Amount of the Mortgage Loans as of the
last day of the related Due Period exceeds (a) 39.70% of the prior period's
Senior Enhancement Percentage while any Class A Certificates remain outstanding,
or (b) 50.00% of the prior period's Class M-1 Enhancement Percentage if the
Class A Certificates are no longer outstanding.
Delinquent: A mortgage loan is "Delinquent" if any Scheduled Payment
due on a due date is not made by the close of business on the next scheduled due
date for that mortgage loan (including all Mortgage Loans in foreclosure,
Mortgage Loans in respect of REO Properties and Mortgage Loans for which the
related Mortgagor has declared bankruptcy). A mortgage loan is "30 days
Delinquent" if the Scheduled Payment has not been received by the close of
business on the corresponding day of the month immediately succeeding the month
in which that Scheduled Payment was due or, if there was no corresponding date
(e.g., as when a 30-day
36
month follows a 31-day month in which the payment was due on the 31st day of
that month), then on the last day of that immediately preceding month; and
similarly for "60 days Delinquent" and "90 days Delinquent," etc.
Delivery Date: With respect to the Initial Mortgage Loans, the Closing
Date; with respect to any Subsequent Mortgage Loans, the related Subsequent
Transfer Date therefor.
Denomination: With respect to each Certificate, the amount set forth
on the face thereof as the "Initial Certificate Balance of this Certificate" or
the Percentage Interest appearing on the face thereof.
Depositor: Xxxxxx Xxxxxxx ABS Capital I Inc., a Delaware corporation,
and its successors in interest.
Depository: The initial Depository shall be The Depository Trust
Company, the nominee of which is CEDE & Co., as the registered Holder of the
Book-Entry Certificates. The Depository shall at all times be a "clearing
corporation" as defined in Section 8-102(a)(5) of the Uniform Commercial Code of
the State of New York.
Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
Determination Date: With respect to each Remittance Date, the 15th of
each month, or if the 15th is not a Business Day, the immediately preceding
Business Day.
Distribution Account: The separate Eligible Account created and
maintained by the Securities Administrator pursuant to Section 3.07(d) in the
name of the Securities Administrator for the benefit of the Certificateholders
and designated "Xxxxx Fargo Bank, National Association, in trust for registered
holders of IXIS Real Estate Capital Trust 2007-HE1, Mortgage Pass-Through
Certificates, Series 2007-HE1". Funds in the Distribution Account shall be held
in trust for the Certificateholders for the uses and purposes set forth in this
Agreement.
Distribution Date: The 25th day of each calendar month, or if such day
is not a Business Day, the next succeeding Business Day, commencing in February
2007.
Document Certification and Exception Report: The report attached to
Exhibit F hereto.
Due Date: The day of the month on which the Scheduled Payment is due
on a Mortgage Loan, exclusive of any days of grace.
Due Period: With respect to each Distribution Date, the period
commencing on the second day of the calendar month preceding the month in which
such Distribution Date occurs and ending on the first day of the calendar month
in which such Distribution Date occurs.
Eligible Account: Any of (i) an account or accounts maintained with a
federal or state chartered depository institution or trust company the
commercial paper, short-term debt
37
obligations, demand deposits or other short-term deposits of which are rated in
one of the two highest rating categories by each of the Rating Agencies at the
time any amounts are held on deposit therein, (ii) an account or accounts the
deposits in which are fully insured by the FDIC (to the limits established by
such corporation), the uninsured deposits in which account are otherwise secured
such that, as evidenced by an Opinion of Counsel delivered to each Rating
Agency, the Certificateholders will have a claim with respect to the funds in
such account or a perfected first priority security interest against such
collateral (which shall be limited to Permitted Investments) securing such funds
that is superior to claims of any other depositors or creditors of the
depository institution with which such account is maintained, (iii) a trust
account or accounts maintained with the trust department of a federal or state
chartered depository institution, national banking association or trust company
acting in its fiduciary capacity, (iv) an account otherwise acceptable to each
Rating Agency or (v) an account maintained with a "qualified depository".
Eligible Accounts may bear interest.
Eligible Institution: A federal or state chartered depository
institution or trust company, which (x) with respect to any Eligible Account,
the amounts on deposit in which will be held for less than 30 days, the
commercial paper, short-term debt obligations, or other short-term deposits of
which are rated at least "F1" by Fitch, "P-1" by Xxxxx'x, and either "A-1+" or
"A-1", if the amounts on deposit represent less than 20% of the initial par
value of the securities, are not intended to be used as credit enhancement and
are to be held for less than 30 days, by Standard & Poor's (or a comparable
rating if another Rating Agency is specified by the Depositor by written notice
to the Servicer and the Securities Administrator) or (y) with respect to any
Eligible Account, the amounts on deposit in which will be held for no more than
365 days, the long-term unsecured debt obligations of which are rated at least
"A" by Fitch, "A" by Standard & Poor's and "A2" by Xxxxx'x (or a comparable
rating if another Rating Agency is specified by the Depositor by written notice
to the Servicer and the Securities Administrator).
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
Escrow Account: The Eligible Account or Accounts established and
maintained pursuant to Section 3.09(b).
Escrow Payments: As defined in Section 3.09(b).
Event of Default: As defined in Section 7.01.
Excess Reserve Fund Account: The separate Eligible Account created and
maintained by the Securities Administrator pursuant to Sections 3.07(b) and
3.07(c) in the name of the Securities Administrator, on behalf of the
Supplemental Interest Trust, for the benefit of the Holders of the Regular
Certificates and designated "Xxxxx Fargo Bank, National Association, in trust
for registered holders of IXIS Real Estate Capital Trust 2007-HE1, Mortgage
Pass-Through Certificates, Series 2007-HE1". Funds in the Excess Reserve Fund
Account shall be held in trust for the Holders of the Regular Certificates for
the uses and purposes set forth in this Agreement. Amounts on deposit in the
Excess Reserve Fund Account shall not be invested.
38
Excess Subordinated Amount: With respect to any Distribution Date, the
excess, if any, of (a) the Subordinated Amount on such Distribution Date over
(b) the Specified Subordinated Amount for such Distribution Date.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Expense Fee Rate: As to each Mortgage Loan, a per annum rate equal to
the sum of the Servicing Fee Rate and the Securities Administrator and Master
Servicer Fee Rate.
Expense Fees: As to each Mortgage Loan, the sum of the Servicing Fee
and the Securities Administrator and Master Servicer Fee.
Extra Principal Distribution Amount: As of any Distribution Date, the
lesser of (x) the related Total Monthly Excess Spread for such Distribution Date
and (y) the Subordination Deficiency for such Distribution Date.
Xxxxxx Xxx: The Federal National Mortgage Association, or any
successor thereto.
Xxxxxx Mae Guides: The Xxxxxx Xxx Xxxxxxx' Guide and the Xxxxxx Mae
Servicers' Guide and all amendments or additions thereto.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created and existing under Title III of the
Emergency Home Finance Act of 1970, as amended, or any successor thereto.
Final Certification: A certification submitted by the Custodian in
substantially the form of Exhibit G hereto.
Final Recovery Determination: With respect to any defaulted Mortgage
Loan or any REO Property (other than a Mortgage Loan or REO Property purchased
by an Originator as contemplated by the Assignment and Recognition Agreements),
a determination made by the Servicer that all Insurance Proceeds, Condemnation
Proceeds, Liquidation Proceeds and other payments or recoveries which the
Servicer, in its reasonable good faith judgment, expects to be finally
recoverable in respect thereof have been so recovered. The Servicer shall
maintain records, prepared by a Servicing Officer, of each Final Recovery
Determination made thereby.
Final Scheduled Distribution Date: The Final Scheduled Distribution
Date for each Class of Certificates is the Distribution Date in each of the
following months:
FINAL SCHEDULED
DISTRIBUTION DATE
-----------------
Class A-1 Certificates.............................. May 2037
Class A-2 Certificates.............................. May 2037
Class A-3 Certificates.............................. May 2037
Class A-4 Certificates.............................. May 2037
39
FINAL SCHEDULED
DISTRIBUTION DATE
-----------------
Class M-1 Certificates.............................. May 2037
Class M-2 Certificates.............................. May 2037
Class M-3 Certificates.............................. May 2037
Class M-4 Certificates.............................. May 2037
Class M-5 Certificates.............................. May 2037
Class M-6 Certificates.............................. May 2037
Class B-1 Certificates.............................. May 2037
Class B-2 Certificates.............................. May 2037
Class B-3 Certificates.............................. May 2037
Class B-4 Certificates.............................. May 2037
Class X Certificates................................ May 2037
Class P Certificates................................ May 2037
Class R Certificates................................ May 2037
First Bank: First Bank Mortgage, a Missouri corporation, and its
successors in interest.
First Bank Agreements: The First Bank Purchase Agreement and the First
Bank Assignment Agreement, copies of which are attached hereto as Exhibit AA.
First Bank Assignment Agreement: The Assignment and Recognition
Agreement, dated as of January 30, 2007, by and among the Unaffiliated Seller,
the Depositor and First Bank, and each other Assignment and Recognition
Agreement by and among the Unaffiliated Seller, the Depositor and First Bank in
connection with any Subsequent Transfer of First Bank Mortgage Loans.
First Bank Mortgage Loan: A Mortgage Loan which was acquired from
First Bank by the Unaffiliated Seller pursuant to the First Bank Purchase
Agreement, and which has been acquired by the Trust Fund.
First Bank Purchase Agreement: The First Amended and Restated Mortgage
Loan Purchase and Warranties Agreement, dated as of January 1, 2006, as amended
to date, by and between the Unaffiliated Seller and First Bank.
First Horizon: First Horizon Home Loan Corp., a Kansas corporation,
and its successors in interest.
First Horizon Agreements: The First Horizon Purchase Agreement and the
First Horizon Assignment Agreement, copies of which are attached hereto as
Exhibit BB.
First Horizon Assignment Agreement: The Assignment and Recognition
Agreement, dated as of January 30, 2007, by and among the Unaffiliated Seller,
the Depositor and First Horizon, and each other Assignment and Recognition
Agreement by and among the
40
Unaffiliated Seller, the Depositor and First Horizon in connection with any
Subsequent Transfer of First Horizon Mortgage Loans.
First Horizon Mortgage Loan: A Mortgage Loan which was acquired from
First Horizon by the Unaffiliated Seller pursuant to the First Horizon Purchase
Agreement, and which has been acquired by the Trust Fund.
First Horizon Purchase Agreement: The Second Amended and Restated
Mortgage Loan Purchase and Warranties Agreement, dated as of July 1, 2006, as
amended to date, by and between the Unaffiliated Seller and First Horizon.
First Lien Mortgage Loan: A Mortgage Loan secured by a first lien
Mortgage on the related Mortgaged Property.
First NLC: First NLC Financial Services., a Florida limited liability
company, and its successors in interest.
First NLC Agreements: The First NLC Purchase Agreement and the First
NLC Assignment Agreement, copies of which are attached hereto as Exhibit CC.
First NLC Assignment Agreement: The Assignment and Recognition
Agreement, dated as of January 30, 2007, by and among the Unaffiliated Seller,
the Depositor and First NLC, and each other Assignment and Recognition Agreement
by and among the Unaffiliated Seller, the Depositor and First NLC in connection
with any Subsequent Transfer of First Bank Mortgage Loans.
First NLC Mortgage Loan: A Mortgage Loan which was acquired from First
NLC by the Unaffiliated Seller pursuant to the First NLC Purchase Agreement, and
which has been acquired by the Trust Fund.
First NLC Purchase Agreement: The Third Amended Mortgage Loan Purchase
and Warranties Agreement, dated as of May 1, 2006, as amended to date, by and
between the Unaffiliated Seller and First NLC.
Fitch: Fitch, Inc., and its successors in interest. If Fitch is
designated as a Rating Agency in the Preliminary Statement, for purposes of
Section 10.06 the address for notices to Fitch shall be Fitch, Inc., Xxx Xxxxx
Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Residential Mortgage
Surveillance Group - IXIS Real Estate Capital Trust 2007-HE1, or such other
address as Fitch may hereafter furnish to the Depositor, the Securities
Administrator, the Trustee and the Servicer.
Fixed Rate Mortgage Loan: A Mortgage Loan bearing interest at a fixed
rate.
FlexPoint: FlexPoint Funding Corp., a California corporation, and its
successors in interest.
FlexPoint Agreements: The FlexPoint Purchase Agreement and the
FlexPoint Assignment Agreement, copies of which are attached hereto as Exhibit
DD.
41
FlexPoint Assignment Agreement: The Assignment and Recognition
Agreement, dated as of January 30, 2007, by and among the Unaffiliated Seller,
the Depositor and FlexPoint, and each other Assignment and Recognition Agreement
by and among the Unaffiliated Seller, the Depositor and FlexPoint in connection
with any Subsequent Transfer of FlexPoint Mortgage Loans.
FlexPoint Mortgage Loan: A Mortgage Loan which was acquired from
FlexPoint by the Unaffiliated Seller pursuant to the FlexPoint Purchase
Agreement, and which has been acquired by the Trust Fund.
FlexPoint Purchase Agreement: The Second Amended and Restated Mortgage
Loan Purchase and Warranties Agreement, dated as of February 1, 2006, as amended
to date, by and between the Unaffiliated Seller and FlexPoint.
Floor Amount: An amount equal to the product of (x) 0.50% and (y) the
Maximum Pool Principal Balance.
Form 8-K Disclosure Information: As defined in Section 8.12(g).
Funding America: Funding America Mortgage Warehouse Trust, a Delaware
statutory trust and/or Funding America Mortgage Warehouse Trust I, a Delaware
statutory trust, each a wholly owned subsidiary of Funding America, LLC, and
their respective successors in interest.
Funding America Agreements: The Funding America Purchase Agreement and
the Funding America Assignment Agreement, copies of which are attached hereto as
Exhibit EE.
Funding America Assignment Agreement: The Assignment and Recognition
Agreement, dated as of January 30, 2007, by and among the Unaffiliated Seller,
the Depositor and Funding America, and each other Assignment and Recognition
Agreement by and among the Unaffiliated Seller, the Depositor and Funding
America in connection with any Subsequent Transfer of Funding America Mortgage
Loans.
Funding America Mortgage Loan: A Mortgage Loan which was acquired from
Funding America by the Unaffiliated Seller pursuant to the Funding America
Purchase Agreement, and which has been acquired by the Trust Fund.
Funding America Purchase Agreement: The Second Amended and Restated
Mortgage Loan Purchase and Warranties Agreement, dated as of May 1, 2006, as
amended to date, by and between the Unaffiliated Seller and Funding America
Mortgage Warehouse Trust, and the Mortgage Loan Purchase and Warranties
Agreement, dated as of October 1, 2006, by and between the Unaffiliated Seller,
Ocwen Loan Servicing LLC and Funding America Mortgage Warehouse Trust X.
Xxxxx Margin: With respect to each Adjustable Rate Mortgage Loan, the
fixed percentage amount set forth in the related Mortgage Note to be added to
the applicable Index to determine the Mortgage Rate.
42
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 a
similarly classified loan using different terminology under a law imposing
heightened regulatory scrutiny or additional legal liability for residential
mortgage loans having high interest rates, points and/or fees) or (c) a Mortgage
Loan categorized as High Cost pursuant to Appendix E of Standard & Poor's
Glossary.
Home Loan: A Mortgage Loan categorized as Home Loan pursuant to
Appendix E of Standard & Poor's Glossary.
Index: As to each Adjustable Rate Mortgage Loan, the index from time
to time in effect for the adjustment of the Mortgage Rate set forth as such on
the related Mortgage Note.
Initial Cut-off Date: January 1, 2007.
Initial Mortgage Loans: The Mortgage Loans delivered by the Depositor
on the Startup Day.
Initial Pre-Funded Amount: $145,206,606
Insurance Policy: With respect to any Mortgage Loan included in the
Trust Fund, any insurance policy, including all riders and endorsements thereto
in effect, including any replacement policy or policies for any Insurance
Policies.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
Interest Accrual Period: With respect to any Distribution Date, the
period beginning with the preceding Distribution Date (or in the case of the
first Distribution Date, the period from and including the Closing Date to but
excluding such first Distribution Date) through and including the day
immediately preceding the current Distribution Date (on an actual/360 day count
basis).
Interest Rate Cap Agreement: The Interest Rate Cap Agreement dated as
of January 30, 2007, between the Supplemental Interest Trust and the Cap
Provider, a copy if which is attached hereto as Exhibit V.
Interest Rate Cap Payment: With respect to any Distribution Date, the
payment, if any, required to be made by the Cap Provider under the Interest Rate
Cap Agreement with respect to such Distribution Date.
Interest Rate Swap Agreement: The Interest Rate Swap Agreement dated
as of January 30, 2007, between the Supplemental Interest Trust and the Swap
Provider, a copy if which is attached hereto as Exhibit U.
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Interest Remittance Amount: With respect to any Distribution Date, the
sum of (a) the sum, without duplication, of the following amounts received by
the Master Servicer from the Servicer on the related Remittance Date:
(i) all installments of interest due on the Mortgage Loans during the
related Prepayment Period and received or advanced by the Servicer on or prior
to the related Remittance Date;
(ii) Compensating Interest paid by the Servicer on such Remittance
Date;
(iii) the interest component of all Substitution Adjustment Amounts
and Repurchase Prices received by the Servicer during the related Prepayment
Period;
(iv) the interest component of all Condemnation Proceeds, Insurance
Proceeds and Liquidation Proceeds received by the Servicer during the related
Prepayment Period (in each case, net (but not to be reduced below zero) of
unreimbursed expenses incurred in connection with a liquidation or foreclosure
and unreimbursed Advances, if any); and
(v) the interest component of the proceeds of any termination of the
Trust Fund;
reduced by the Securities Administrator and Master Servicer Fee and
the Servicing Fee for the related Prepayment Period for the related Distribution
Date, together with amounts in reimbursement for Advances previously made with
respect to the Mortgage Loans and other amounts as to which the Servicer, or the
Trustee, Securities Administrator, Master Servicer and Custodian is entitled to
be reimbursed pursuant to the Agreement; and
(b) the Capitalized Interest Requirement, if any, deposited into the
Distribution Account on such Distribution Date.
Investment Account: As defined in Section 3.12(a).
Investor: With respect to each MERS Designated Mortgage Loan, the
Person named on the MERS System as the investor pursuant to the MERS Procedures
Manual.
Investor-Based Exemption: Prohibited Transaction Class Exemption
84-14, Prohibited Transaction Class Exemption 90-1, Prohibited Transaction Class
Exemption 91-38, PTCE 95-60 or Prohibited Transaction Class Exemption 96-23, as
each may be amended from time to time, or any similar prohibited transaction
class exemption granted by the U.S. Department of Labor or, with respect to any
governmental plan (as defined in Section 3(32) of ERISA), granted pursuant to
any federal, state or local law materially similar to Title I of ERISA or
Section 4975 of the Code.
Late Collections: With respect to any Mortgage Loan and any Due
Period, all amounts received subsequent to the Determination Date immediately
following such Due Period, whether as late payments of Scheduled Payments or as
Insurance Proceeds, Condemnation Proceeds, Liquidation Proceeds or otherwise,
which represent late payments or collections of
44
principal and/or interest due (without regard to any acceleration of payments
under the related Mortgage and Mortgage Note) but delinquent for such Due Period
and not previously recovered.
Lenders Direct: Lenders Direct Capital Corp., a California
corporation, and its successors in interest.
Lenders Direct Agreements: The Lenders Direct Purchase Agreement and
the Lenders Direct Assignment Agreement, copies of which are attached hereto as
Exhibit FF.
Lenders Direct Assignment Agreement: The Assignment and Recognition
Agreement, dated as of January 30, 2007, by and among the Unaffiliated Seller,
the Depositor and Lenders Direct, and each other Assignment and Recognition
Agreement by and among the Unaffiliated Seller, the Depositor and Lenders Direct
in connection with any Subsequent Transfer of Lenders Mortgage Loans.
Lenders Direct Mortgage Loan: A Mortgage Loan which was acquired from
Lenders Direct by the Unaffiliated Seller pursuant to the Lenders Direct
Purchase Agreement, and which has been acquired by the Trust Fund.
Lenders Direct Purchase Agreement: The Second Amended and Restated
Mortgage Loan Purchase and Warranties Agreement, dated as of December 1, 2005,
as amended to date, by and between the Unaffiliated Seller and Lenders Direct.
LIBOR: With respect to any Interest Accrual Period for the LIBOR
Certificates, the rate determined by the Securities Administrator on the related
LIBOR Determination Date on the basis of the offered rate for one-month U.S.
dollar deposits as such rate appears on Telerate Page 3750 as of 11:00 a.m.
(London time) on such date; provided that if such rate does not appear on
Telerate Page 3750, the rate for such date will be determined on the basis of
the rates at which one-month U.S. dollar deposits are offered by the Reference
Banks at approximately 11:00 a.m. (London time) on such date to prime banks in
the London interbank market. In such event, the Securities Administrator shall
request that the principal London office of each of the Reference Banks to
provide a quotation of its rate. If at least two such quotations are provided,
the rate for that date will be the arithmetic mean of the quotations. If fewer
than two quotations are provided as requested, the rate for that date will be
the arithmetic mean of the rates quoted by major banks in New York City,
selected by the Securities Administrator, after consultation with the Depositor,
at approximately 11:00 a.m. (New York City time) on such date for one-month U.S.
dollar loans to leading European banks. LIBOR for the initial Interest Accrual
Period shall be 5.320%.
LIBOR Certificates: As specified in the Preliminary Statement.
LIBOR Determination Date: With respect to any Interest Accrual Period
(other than the initial Interest Accrual Period) for the LIBOR Certificates, the
second London Business Day preceding the commencement of such Interest Accrual
Period.
Lime Financial: Lime Financial Services, Ltd., an Oregon corporation,
and its successors in interest.
45
Lime Financial Agreements: The Lime Financial Purchase Agreement and
the Lime Financial Assignment Agreement, copies of which are attached hereto as
Exhibit GG.
Lime Financial Assignment Agreement: The Assignment and Recognition
Agreement, dated as of January 30, 2007, by and among the Unaffiliated Seller,
the Depositor and Lime Financial, and each other Assignment and Recognition
Agreement by and among the Unaffiliated Seller, the Depositor and Lime Financial
in connection with any Subsequent Transfer of Lime Financial Mortgage Loans.
Lime Financial Mortgage Loan: A Mortgage Loan which was acquired from
Lime Financial by the Unaffiliated Seller pursuant to the Lime Financial
Purchase Agreement, and which has been acquired by the Trust Fund.
Lime Financial Purchase Agreement: The Second Amended and Restated
Mortgage Loan Purchase and Warranties Agreement, dated as of April 27, 2006, as
amended to date, by and between the Unaffiliated Seller and Lime Financial.
Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) which either (a) was
liquidated in the calendar month preceding the month of such Distribution Date
and as to which the Servicer has certified to the Securities Administrator and
the Master Servicer that it has received all amounts it expects to receive in
connection with the liquidation of such Mortgage Loan including the final
disposition of an REO Property ; or (b) is a Second Lien Mortgage Loan (1) that
is delinquent 180 days or longer, (2) for which the related first lien mortgage
loan is not a Mortgage Loan, and (3) as to which the Servicer has certified to
the Master Servicer that it does not believe there is a reasonable likelihood
that any further net proceeds will be received or recovered with respect to such
Second Lien Mortgage Loan.
Liquidation Event: With respect to any Mortgage Loan, any of the
following events: (i) such Mortgage Loan is paid in full; (ii) a Final Recovery
Determination is made as to such Mortgage Loan; or (iii) such Mortgage Loan is
removed from coverage under this Agreement by reason of its being purchased,
sold or replaced pursuant to or as contemplated by this Agreement. With respect
to any REO Property, either of the following events: (i) a Final Recovery
Determination is made as to such REO Property; or (ii) such REO Property is
removed from coverage under this Agreement by reason of its being purchased
pursuant to this Agreement.
Liquidation Proceeds: Cash received in connection with the liquidation
of a Liquidated Mortgage Loan, whether through a trustee's sale, foreclosure
sale or otherwise, including any Subsequent Recoveries.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan, the
ratio (expressed as a percentage) of the original outstanding principal amount
of the Mortgage Loan as of the Cut-off Date (unless otherwise indicated), to the
lesser of (a) the Appraised Value of the Mortgaged Property at origination, and
(b) if the Mortgage Loan was made to finance the acquisition of the related
Mortgaged Property, the purchase price of the Mortgaged Property.
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London Business Day: Any day on which dealings in deposits of United
States dollars are transacted in the London interbank market.
Mandalay: Mandalay Mortgage, LLC, a Delaware limited liability
company, and its successors in interest.
Mandalay Agreements: The Mandalay Purchase Agreement and the Mandalay
Assignment Agreement, copies of which are attached hereto as Exhibit HH.
Mandalay Assignment Agreement: The Assignment and Recognition
Agreement, dated as of January 30, 2007, by and among the Unaffiliated Seller,
the Depositor and Mandalay, and each other Assignment and Recognition Agreement
by and among the Unaffiliated Seller, the Depositor and Mandalay in connection
with any Subsequent Transfer of Mandalay Mortgage Loans.
Mandalay Mortgage Loan: A Mortgage Loan which was acquired from
Mandalay by the Unaffiliated Seller pursuant to the Mandalay Purchase Agreement,
and which has been acquired by the Trust Fund.
Mandalay Purchase Agreement: The Amended and Restated Mortgage Loan
Purchase and Warranties Agreement, dated as of June 1, 2006, as amended to date,
by and between the Unaffiliated Seller and Mandalay.
Master Financial: Master Financial, Inc., a California corporation,
and its successors in interest.
Master Financial Agreements: The Master Financial Purchase Agreement
and the Master Financial Assignment Agreement, copies of which are attached
hereto as Exhibit II.
Master Financial Assignment Agreement: The Assignment and Recognition
Agreement, dated as of January 30, 2007, by and among the Unaffiliated Seller,
the Depositor and Master Financial, and each other Assignment and Recognition
Agreement by and among the Unaffiliated Seller, the Depositor and Master
Financial in connection with any Subsequent Transfer of Master Financial
Mortgage Loans.
Master Financial Mortgage Loan: A Mortgage Loan which was acquired
from Master Financial by the Unaffiliated Seller pursuant to the Master
Financial Purchase Agreement, and which has been acquired by the Trust Fund.
Master Financial Purchase Agreement: The Second Amended and Restated
Mortgage Loan Purchase and Warranties Agreement, dated as of February 1, 2006,
as amended to date, by and between the Unaffiliated Seller and Master Financial.
Master Servicer: Xxxxx Fargo Bank, National Association, a banking
association organized under the laws of the United States, and its successors in
interest and, if a successor master servicer is appointed hereunder, such
successor master servicer.
Master Servicer Events of Default: As defined in Section 9.04.
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Maxim: Maxim Mortgage Corp., a Texas corporation, and its successors
in interest.
Maxim Agreements: The Maxim Purchase Agreement and the Maxim
Assignment Agreement, copies of which are attached hereto as Exhibit JJ.
Maxim Assignment Agreement: The Assignment and Recognition Agreement,
dated as of January 30, 2007, by and among the Unaffiliated Seller, the
Depositor and Maxim, and each other Assignment and Recognition Agreement by and
among the Unaffiliated Seller, the Depositor and Maxim in connection with any
Subsequent Transfer of Maxim Mortgage Loans.
Maxim Mortgage Loan: A Mortgage Loan which was acquired from Maxim by
the Unaffiliated Seller pursuant to the Maxim Purchase Agreement, and which has
been acquired by the Trust Fund.
Maxim Purchase Agreement: The Mortgage Loan Purchase and Warranties
Agreement, dated as of August 1, 2006, as amended to date, by and between the
Unaffiliated Seller and Maxim.
Maximum Mortgage Rate: With respect to each Adjustable Rate Mortgage
Loan, a rate that (i) is set forth on the Data Tape Information and in the
related Mortgage Note and (ii) is the maximum interest rate to which the
Mortgage Rate on such Adjustable Rate Mortgage Loan may be increased during the
lifetime of such Adjustable Rate Mortgage Loan.
Maximum Pool Principal Balance: The aggregate Stated Principal
Balances of all Initial Mortgage Loans as of the Initial Cut-off Date plus the
Initial Pre-Funded Amount.
MERS: Mortgage Electronic Registration System, Inc, and its successors
in interest, or any designee thereof.
MERS Designated Mortgage Loan: Mortgage Loans for which (a) the
Originators have designated or will designate MERS as, and have taken or will
take such action as is necessary to cause MERS to be, the mortgagee of record,
as nominee for the Originators, in accordance with the MERS Procedure Manual and
(b) the Originators have designated or will designate the Trustee as the
Investor on the MERS(R) System.
MERS Procedures Manual: The MERS Procedures Manual, as it may be
amended, supplemented or otherwise modified from time to time.
MERS(R) System: MERS mortgage electronic registry system, as more
particularly described in the MERS Procedures Manual.
Minimum Mortgage Rate: With respect to each Adjustable Rate Mortgage
Loan, a rate that (i) is set forth on the Data Tape Information and in the
related Mortgage Note and (ii) is the minimum interest rate to which the
Mortgage Rate on such Adjustable Rate Mortgage Loan may be decreased during the
lifetime of such Adjustable Rate Mortgage Loan.
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Monthly Statement: The statement delivered to the Certificateholders
and other parties as specified in and pursuant to Section 4.03(a).
Moody's: Xxxxx'x Investors Service, Inc, and its successors in
interest. If Xxxxx'x is designated as a Rating Agency in the Preliminary
Statement, for purposes of Section 10.06 the address for notices to Moody's
shall be Xxxxx'x Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Residential Mortgage Pass-Through Group, or such other address
as Moody's may hereafter furnish to the Depositor, the Trustee, and the
Servicer.
Mortgage: The mortgage, deed of trust or other instrument identified
on the Mortgage Loan Schedule as securing a Mortgage Note.
Mortgage File: The items pertaining to a particular Mortgage Loan
contained in either the Servicing File or Custodial File.
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 Scheduled Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
REO Disposition proceeds, Prepayment Charges, and all other rights, benefits,
proceeds and obligations arising from or in connection with such Mortgage Loan,
excluding replaced or repurchased Mortgage Loans. As applicable, "Mortgage Loan"
shall be deemed to refer to REO Property.
Mortgage Loan Purchase Agreement: The Accredited Purchase Agreement,
the CIT Purchase Agreement, the First Bank Purchase Agreement, the First Horizon
Purchase Agreement, the First NLC Purchase Agreement, the FlexPoint Purchase
Agreement, the Funding America Purchase Agreement, the Lenders Direct Purchase
Agreement, the Lime Financial Purchase Agreement, the Mandalay Purchase
Agreement, the Master Financial Purchase Agreement, the Maxim Purchase
Agreement, the NC Capital Purchase Agreement, the Quick Loan Purchase Agreement,
the Platinum Purchase Agreement, the Rose Purchase Agreement or the Sebring
Purchase Agreement, as applicable.
Mortgage Loan Schedule: A schedule of Mortgage Loans annexed hereto as
Schedule I, such schedule setting forth the following information with respect
to each Mortgage Loan: (1) the Originator's Mortgage Loan number; (2) the 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, PUD or condominium; (4) the
current Mortgage Rate; (5) the current net Mortgage Rate; (6) the current
Scheduled Payment; (7) with respect to each Adjustable Rate Mortgage Loan, the
Gross Margin; (8) the original term to maturity; (9) the scheduled maturity
date; (10) 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; (11) the Loan-to-Value Ratio; (12) the next Interest
Rate Adjustment Date; (13) with respect to each Adjustable Rate Mortgage Loan,
the lifetime mortgage interest rate cap; (14) whether the Mortgage Loan is
convertible or not; (15) a code indicating the mortgage guaranty insurance
company; (16) the Servicing Fee; (17) the
49
identity of the related Originator of such Mortgage Loan; (18) the Mortgagor's
name; (19) the "paid-through" date (based on payments received from the related
Mortgagor) as of the Cut-off Date; (20) the Servicing Transfer Date; (21)
whether such Mortgage Loan has been 30 days Delinquent since the applicable
Servicing Transfer Date; and (22) whether such Mortgage Loan provides for a
Prepayment Charge as well as the term and amount of such Prepayment Charge, if
any.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor under a Mortgage Loan.
Mortgage Rate: The annual rate of interest borne on a Mortgage Note,
which shall be adjusted from time to time with respect to Adjustable Rate
Mortgage Loans.
Mortgage Rate Caps: With respect to an Adjustable Rate Mortgage Loan,
the Periodic Mortgage Rate Cap, the Maximum Mortgage Rate, and the Minimum
Mortgage Rate for such Mortgage Loan.
Mortgaged Property: With respect to each Mortgage Loan, the real
property (or leasehold estate, if applicable) identified on the Mortgage Loan
Schedule as securing repayment of the debt evidenced by the related Mortgage
Note.
Mortgagor: The obligor(s) on a Mortgage Note.
NC Capital: NC Capital Corporation, a California corporation, and its
successors in interest.
NC Capital Agreements: The NC Capital Purchase Agreement and the NC
Capital Assignment Agreement, copies of which are attached hereto as Exhibit KK.
NC Capital Assignment Agreement: The Assignment and Recognition
Agreement, dated as of January 30, 2007, by and among the Unaffiliated Seller,
the Depositor and NC Capital, and each other Assignment and Recognition
Agreement by and among the Unaffiliated Seller, the Depositor and NC Capital in
connection with any Subsequent Transfer of NC Capital Mortgage Loans.
NC Capital Mortgage Loan: A Mortgage Loan which was acquired from NC
Capital by the Unaffiliated Seller pursuant to the NC Capital Purchase
Agreement, and which has been acquired by the Trust Fund.
NC Capital Purchase Agreement: The Third Amended and Restated Mortgage
Loan Purchase and Warranties Agreement, dated as of April 1, 2006, as amended to
date, by and between the Unaffiliated Seller and NC Capital.
Net Monthly Excess Cash Flow: For any Distribution Date the amount
remaining for distribution pursuant to subsection 4.02(a)(iii) (before giving
effect to distributions pursuant to such subsection).
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Net Prepayment Interest Shortfall: For any Distribution Date, the
amount by which the sum of the Prepayment Interest Shortfalls for such
Distribution Date exceeds the sum of (i) the Compensating Interest payments made
with respect to such Distribution Date and (ii) all Prepayment Interest Excesses
for such Distribution Date.
Net Swap Payment: With respect to any Distribution Date, any net
payment (other than a Swap Termination Payment) payable by the Supplemental
Interest Trust to the Swap Provider on the related Fixed Rate Payer Payment Date
(as defined in the Interest Rate Swap Agreement).
Net Swap Receipt: With respect to any Distribution Date, any net
payment (other than a Swap Termination Payment) payable by the Swap Provider to
the Supplemental Interest Trust on the related Floating Rate Payer Payment Date
(as defined in the Interest Rate Swap Agreement).
NIM Issuer: Any entity established as the issuer of a series of NIM
Securities.
NIM Indenture: The Indenture, dated as of January 30, 2007, between
IXIS Real Estate Capital Inc. NIM Trust 2007-HE1N, as co-issuer, and Xxxxx Fargo
Bank, National Association, as indenture trustee.
NIM Securities: Any debt securities secured or otherwise backed by
some or all of the Class X and Class P Certificates that are rated by one or
more Rating Agencies.
NIM Trustee: The trustee for any series of NIM Securities.
Non-Delay Certificates: As specified in the Preliminary Statement.
Non-Permitted Transferee: A Person other than a Permitted Transferee.
Nonrecoverable P&I Advance: Any P&I Advance previously made or
proposed to be made in respect of a Mortgage Loan or REO Property that, in the
good faith business judgment of the Servicer or the Master Servicer or any
successor Master Servicer, will not or, in the case of a proposed P&I Advance,
would not be ultimately recoverable from related late payments, Insurance
Proceeds, Condemnation Proceeds, Liquidation Proceeds or otherwise on such
Mortgage Loan or REO Property as provided herein.
Nonrecoverable Servicing Advance: Any Servicing Advances previously
made or proposed to be made in respect of a Mortgage Loan or REO Property,
which, in the good faith business judgment of the Servicer, or the Master
Servicer or any successor Master Servicer, will not or, in the case of a
proposed Servicing Advance, would not, be ultimately recoverable from related
late payments, Insurance Proceeds, Condemnation Proceeds, Liquidation Proceeds
or otherwise on such Mortgage Loan or REO Property. The determination by the
Servicer or the Master Servicer or any successor Master Servicer that it has
made a Nonrecoverable Servicing Advance or that any proposed Servicing Advances,
if made, would constitute a Nonrecoverable Servicing Advance, shall be evidenced
by an Officers' Certificate delivered to the Securities Administrator and the
Master Servicer.
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Notice of Final Distribution: The notice to be provided pursuant to
Section 11.02 to the effect that final distribution on any of the Certificates
shall be made only upon presentation and surrender thereof.
Offered Certificates: As specified in the Preliminary Statement.
Officer's Certificate: A certificate signed by an officer of the
Servicer or Subservicer responsibility for the servicing of the Mortgage Loans
required to be serviced by the Servicer or Subservicer and listed on a list
delivered to the Securities Administrator pursuant to this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be in-house
counsel for the Servicer or the Subservicer, reasonably acceptable to the
Trustee and the Securities Administrator; provided that any Opinion of Counsel
relating to (a) qualification of the Mortgage Loans in a REMIC or (b) compliance
with the REMIC Provisions, must be (unless otherwise stated in such Opinion of
Counsel) an opinion of counsel who (i) is in fact independent of the Servicer,
(ii) does not have any material direct or indirect financial interest in the
Servicer or in an Affiliate thereof and (iii) is not connected with the Servicer
as an officer, employee, director or person performing similar functions.
Optional Termination Date: means:
(i) For so long as the Class X Certificates are 100% owned, either
directly or indirectly, by the Unaffiliated Seller or any Affiliate thereof,
then the Servicer may cause the Optional Termination Date to occur on any
Distribution Date when the aggregate Stated Principal Balance of the Mortgage
Loans is 5.00% or less of the Maximum Pool Principal Balance; provided, that if
the Servicer does not exercise its right to cause the Optional Termination Date
to occur, the Master Servicer may cause the Optional Termination Date to occur
on any Distribution Date when the aggregate Stated Principal Balance of the
Mortgage Loans is 5.00% or less of the Maximum Pool Principal Balance; and
(ii) If the Class X Certificates are not 100% owned, either directly
or indirectly, by the Unaffiliated Seller or any Affiliate thereof, then the
Holders of a majority in Class Certificate Balance of the Class X Certificates
may cause the Optional Termination Date to occur on any Distribution Date when
the aggregate Stated Principal Balance of the Mortgage Loans is 5.00% or less of
the Maximum Pool Principal Balance, and, if such Class X Certificateholders do
not do so, then the Servicer shall also have such right; provided, however, that
the Unaffiliated Seller or any of its Affiliates, may only participate in the
exercise of the clean-up call by the majority owners of the Class X Certificates
if the Unaffiliated Seller or any of its Affiliates, is not the majority owner
of the Class X Certificates, either directly or indirectly.
Originator: The party that originated or acquired a Mortgage Loan and,
more specifically, (i) with respect to any Accredited Mortgage Loan, Accredited,
(ii) with respect to any CIT Mortgage Loan, CIT, (iii) with respect to any First
Bank Mortgage, Inc., First Bank, (iv) with respect to any First Horizon Mortgage
Loan, First Horizon, (v) with respect to any First NLC Mortgage Loan, First NLC,
(vi) with respect to any FlexPoint Mortgage Loan, FlexPoint, (vii) with respect
to any Funding America, LLC, Funding America, (viii) with respect to any
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Lenders Direct Mortgage Loan, Lenders Direct, (ix) with respect to any Lime
Financial Mortgage Loan, Lime Financial, (x) with respect to Mandalay Mortgage,
LLC, Mandalay, (xi) with respect to any Master Financial Mortgage Loan, Master
Financial, (xii) with respect to any Maxim Mortgage Loan, Maxim, (xiii) with
respect to any NC Capital Mortgage Loan, NC Capital, (xiv) with respect to any
Quick Loan Mortgage Loan, Quick Loan, (xv) with respect to any Platinum Mortgage
Loan, Platinum, (xvi) with respect to any Rose Mortgage Loan, Rose and (xvii)
with respect to any Sebring Mortgage Loan, Sebring.
OTS: Office of Thrift Supervision, and any successor thereto.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Securities Administrator
or delivered to the Securities Administrator for cancellation; and
(ii) Certificates in exchange for which or in lieu of which other
Certificates have been executed and delivered by the Securities Administrator
pursuant to this Agreement.
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan with a
Stated Principal Balance greater than zero which was not the subject of a
Principal Prepayment in Full prior to such Due Date and which did not become a
Liquidated Mortgage Loan prior to such Due Date.
Ownership Interest: As to any Residual Certificate, any ownership
interest in such Certificate including any interest in such Certificate as the
Holder thereof and any other interest therein, whether direct or indirect, legal
or beneficial.
P&I Advance: As to any Mortgage Loan or REO Property, any advance made
by the Servicer or the Master Servicer (including the Trustee as successor
Master Servicer and any other successor Master Servicer, as applicable) in
respect of any Remittance Date with respect to any Mortgage Loan representing
the aggregate of all payments of principal and/or interest on such Mortgage
Loan, net of the related Servicing Fee, that were due during the related Due
Period on the Mortgage Loan, and that were delinquent or unpaid on the related
Determination Date, plus certain amounts representing assumed payments not
covered by any current net income on the Mortgaged Properties acquired by
foreclosure or deed in lieu of foreclosure as determined pursuant to Section
4.01.
Pass-Through Margin: With respect to each Class of Regular
Certificates, on or prior to the Optional Termination Date the following
percentages: Class A-1, 0.0600%; Class A-2, 0.1100%; Class A-3, 0.1600%; Class
A-4, 0.2300%; Class M-1, 0.2800%; Class M-2, 0.2900%; Class M-3, 0.3300%; Class
M-4, 0.3800%; Class M-5, 0.4000%; Class M-6, 0.4600%; Class B-1, 1.1000%; Class
B-2, 1.8000%; Class B-3, 2.4000%; and Class B-4, 2.4000% On the first
Distribution Date after the Optional Termination Date, the Pass-Through Margins
shall increase to the following percentages: Class A-1, 0.1200%; Class A-2,
0.2200%; Class A-3, 0.3200%; Class A-4, 0.4600%; Class M-1, 0.4200%; Class M-2,
0.4350%; Class M-3, 0.4950%; Class M-4, 0.5700%; Class M-5, 0.6000%; Class M-6,
0.6900%; Class B-1, 1.6500%; Class B-2, 2.7000%; Class B-3, 3.6000%; and Class
B-4, 3.6000%.
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Pass-Through Rate: For any Distribution Date, the "Pass-Through Rate"
for each class of LIBOR Certificates will be a per annum rate equal to the
lesser of (1) One-Month LIBOR plus the related Pass-Through Margin for such
classes and that Distribution Date and (2) the WAC Cap.
PCAOB: The Public Company Accounting Oversight Board.
Percentage Interest: As to any Certificate, the percentage interest
evidenced thereby in distributions required to be made on the related Class,
such percentage interest being set forth on the face thereof or equal to the
percentage obtained by dividing the Denomination of such Certificate by the
aggregate of the Denominations of all Certificates of the same Class.
Periodic Mortgage Rate Cap: With respect to an Adjustable Rate
Mortgage Loan, the periodic limit on each Mortgage Rate adjustment as set forth
in the related Mortgage Note.
Permitted Investments: Any one or more of the following obligations or
securities acquired at a purchase price of not greater than par, regardless of
whether issued by the Servicer, the Trustee, the Securities Administrator or any
of their respective Affiliates:
(i) direct obligations of, or obligations fully guaranteed as to
timely payment of 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;
(ii) demand and time deposits in, certificates of deposit of, or
bankers' acceptances (which shall each have an original maturity of not
more than 90 days and, in the case of bankers' acceptances, shall in no
event have an original maturity of more than 365 days or a remaining
maturity of more than 30 days) denominated in United States dollars and
issued by, any Eligible Institution;
(iii) repurchase obligations with respect to any security described in
clause (i) above entered into with an Eligible Institution (acting as
principal);
(iv) securities bearing interest or sold at a discount that are issued
by any corporation incorporated under the laws of the United States of
America or any state thereof and that are rated by each Rating Agency that
rates such securities in its highest long-term unsecured rating categories
at the time of such investment or contractual commitment providing for such
investment;
(v) commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations payable on demand or on a
specified date not more than 30 days after the date of acquisition thereof)
that is rated by each Rating Agency that rates such securities in its
highest short-term unsecured debt rating available at the time of such
investment;
(vi) any demand, money market fund, common trust fund or time deposit
or obligation, or interest-bearing or other security or investment, (A)
rated in the highest rating category by each Rating Agency (if rated by
such Rating Agency) or (B) that would not adversely affect the then current
rating by either Rating Agency of any of the
54
Certificates. Such investments in this subsection (vi) may include money
market mutual funds or common trust funds, including, without limitation,
the Xxxxx Fargo Advantage Prime Money Market Fund or any other fund for
which Xxxxx Fargo Bank, National Association, the Trustee or an affiliate
thereof serves as an investment advisor, administrator, shareholder
servicing agent, and/or custodian or subcustodian, notwithstanding that (i)
Xxxxx Fargo Bank, National Association, or an affiliate thereof charges and
collects fees and expenses from such funds for services rendered, (ii)
Xxxxx Fargo Bank, National Association, or an affiliate thereof charges and
collects fees and expenses for services rendered pursuant to this
Agreement, and (iii) services performed for such funds and pursuant to this
Agreement may converge at any time. The Trustee specifically authorizes
Xxxxx Fargo Bank, National Association, or an affiliate thereof to charge
and collect from the Trust Fund such fees as are collected from all
investors in such funds for services rendered to such funds (but not to
exceed investment earnings thereon); and
(vii) if previously confirmed in writing to the Securities
Administrator, any other demand, money market or time deposit, or any other
obligation, security or investment, as may be acceptable to the Rating
Agencies as a permitted investment of funds backing "Aaa" or "AAA" rated
securities;
provided, however, that no instrument described hereunder shall evidence 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.
Permitted Transferee: Any Person other than (i) the United States, any
State or political subdivision thereof, or any agency or instrumentality of any
of the foregoing, (ii) a foreign government, international organization or any
agency or instrumentality of either of the foregoing, (iii) an organization
(except certain farmers' cooperatives described in section 521 of the Code)
which is exempt from tax imposed by Chapter 1 of the Code (including the tax
imposed by section 511 of the Code on unrelated business taxable income) on any
excess inclusions (as defined in section 860E(c)(1) of the Code) with respect to
any Residual Certificate, (iv) rural electric and telephone cooperatives
described in section 1381(a)(2)(C) of the Code, (v) a Person that is not a U.S.
Person, (vi) an "electing large partnership" within the meaning of section 775
of the Code and (vii) any other Person so designated by the Depositor based upon
an Opinion of Counsel that the Transfer of an Ownership Interest in a Residual
Certificate to such Person may cause any REMIC created hereunder to fail to
qualify as a REMIC at any time that the Certificates are outstanding. The terms
"United States," "State" and "international organization" shall have the
meanings set forth in section 7701 of the Code or successor provisions. A
corporation will not be treated as an instrumentality of the United States or of
any State or political subdivision thereof for these purposes if all of its
activities are subject to tax and, with the exception of the Federal Home Loan
Mortgage Corporation, a majority of its board of directors is not selected by
such government unit.
55
Person: Any individual, corporation, partnership, joint venture,
association, limited liability company, joint-stock company, trust,
unincorporated organization or government, or any agency or political
subdivision thereof.
Physical Certificates: As specified in the Preliminary Statement.
Plan: As defined in Section 5.02(b).
Platinum: Platinum Capital Group, a California corporation, and its
successors in interest.
Platinum Agreements: The Platinum Purchase Agreement and the Platinum
Assignment Agreement, copies of which are attached hereto as Exhibit LL.
Platinum Assignment Agreement: The Assignment and Recognition
Agreement, dated as of January 30, 2007, by and among the Unaffiliated Seller,
the Depositor and Platinum, and each other Assignment and Recognition Agreement
by and among the Unaffiliated Seller, the Depositor and Platinum in connection
with any Subsequent Transfer of Platinum Mortgage Loans.
Platinum Mortgage Loan: A Mortgage Loan which was acquired from
Platinum by the Unaffiliated Seller pursuant to the Platinum Purchase Agreement,
and which has been acquired by the Trust Fund.
Platinum Purchase Agreement: The Amended and Restated Mortgage Loan
Purchase and Warranties Agreement, dated as of December 1, 2006, as amended to
date, by and between the Unaffiliated Seller and Platinum.
Pool Stated Principal Balance: As to any Distribution Date, the
aggregate of the Stated Principal Balances of the Mortgage Loans for such
Distribution Date which were Outstanding Mortgage Loans as of the last day of
the related Due Period.
Pre-Funding Account: The separate Eligible Account created and
maintained by the Securities Administrator pursuant to Section 3.07(f) in the
name of Securities Administrator for the benefit of the Certificateholders, and
designated in trust for registered holders of IXIS Real Estate Capital Trust
2007-HE1, Mortgage Pass Through Certificates, Series 2007-HE1, the funds of
which, during the Pre-Funding Period, shall be applied solely to the purchase of
Subsequent Mortgage Loans.
Pre-Funding Amount: With respect to any date, the amount on deposit in
the Pre-Funding Account, which amount the Securities Administrator shall
evidence to the Custodian upon request.
Pre-Funding Earnings: The actual investment earnings realized on
amounts deposited in the Pre-Funding Account.
Pre-Funding Period: The period commencing on the Startup Day and
ending on the earliest to occur of (i) the date on which the amount on deposit
in the Pre-Funding Account
56
(exclusive of any investment earnings) is less than $100,000, (ii) the date on
which any Event of Default occurs and (iii) April 25, 2007.
Pre-Funding Reserve Account: The separate Eligible Account created and
maintained by the Securities Administrator pursuant to Section 3.07(j) in the
name of the Securities Administrator, for the benefit of the Class X
Certificateholders and designated "Xxxxx Fargo Bank, National Association, in
trust for holders of IXIS Real Estate Capital Trust 2007-HE1, Mortgage
Pass-Through Certificates, Series 2007-HE1, Class X".
Prepayment Charge: Any prepayment premium, penalty or charge collected
by the Servicer with respect to a Mortgage Loan from a Mortgagor in connection
with any voluntary Principal Prepayment pursuant to the terms of the related
Mortgage Note.
Prepayment Interest Excess: With respect to any Distribution Date, any
interest collected by the Servicer with respect to any Mortgage Loan as to which
a Principal Prepayment in Full occurs from the 1st day of the month through the
15th day of the month in which such Distribution Date occurs and that represents
interest that accrues from the 1st day of such month to the date of such
Principal Prepayment in Full.
Prepayment Interest Shortfall: With respect to any Remittance Date,
the sum of, for each Mortgage Loan that was during the portion of the Prepayment
Period from and including the 16th day of the month preceding the month in which
such Distribution Date occurs (or from the day following the Cut-off Date, in
the case of the first Distribution Date) through the last day of such month the
subject of a Principal Prepayment in Full, that was applied by the Servicer to
reduce the outstanding principal balance of such Mortgage Loan on a date
preceding the Due Date in the succeeding Prepayment Period, an amount equal to
interest at the applicable Adjusted Net Mortgage Rate on the amount of such
Principal Prepayment for the number of days commencing on the date on which the
prepayment is applied and ending on the last day of the calendar month preceding
such Distribution date.
Prepayment Period: With respect to any Distribution Date, the period
from and including the 16th day of the month preceding the month in which such
Distribution Date occurs (or, in the case of the first Distribution Date, from
and including the Cut-off Date) to and including the 15th day of the month in
which such Distribution Date occurs.
Principal Distribution Amount: For any Distribution Date, the sum of
(i) the Basic Principal Distribution Amount for such Distribution Date and (ii)
the Extra Principal Distribution Amount for such Distribution Date.
Principal Prepayment: Any full or partial payment or other recovery of
principal on a Mortgage Loan (including upon liquidation of a Mortgage Loan)
which is received in advance of its scheduled Due Date, excluding any Prepayment
Charge 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 in Full: Any Principal Prepayment made by a
Mortgagor of the entire principal balance of a Mortgage Loan.
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Principal Remittance Amount: With respect to any Distribution Date,
the amount equal to the sum of the following amounts (without duplication) with
respect to the related Due Period, of: (i) each Scheduled Payment of principal
on a Mortgage Loan during the related Due Period and received by the Servicer on
or prior to the related Determination Date or advanced by the Servicer for the
related Remittance Date and all Principal Prepayments received during the
related Prepayment Period; (ii) the principal component of all Condemnation
Proceeds, Insurance Proceeds and Liquidation Proceeds during the related Due
Period (in each case, net of remaining (i.e., not deducted from the Interest
Remittance Amount) unreimbursed expenses incurred in connection with a
liquidation or foreclosure and unreimbursed Advances, if any); (iii) all partial
or full prepayments on the Mortgage Loans received during the related Prepayment
Period; (iv) the principal component of all Substitution Adjustment Amounts
allocable to principal and Repurchase Prices received by the Servicer with
respect to such Distribution Date; and (v) the proceeds of any termination of
the Trust Fund pursuant to Section 11.01 (to the extent such proceeds relate to
principal); reduced by remaining amounts (i.e., not deducted from the Interest
Remittance Amount) in reimbursement for Advances previously made with respect to
the Mortgage Loans and other amounts as to which the Servicer is entitled to be
reimbursed pursuant to this Agreement.
Private Certificates: As specified in the Preliminary Statement.
Prospectus Supplement: The Prospectus Supplement, dated January 23,
2007, relating to the Offered Certificates.
PTCE 95-60: As defined in Section 5.02(b).
PUD: Planned Unit Development.
Qualified Insurer: A mortgage guaranty insurance company duly
qualified as such under the laws of the state of its principal place of business
and each state having jurisdiction over such insurer in connection with the
insurance policy issued by such insurer, duly authorized and licensed in such
states to transact a mortgage guaranty insurance business in such states and to
write the insurance provided by the insurance policy issued by it, approved as a
FNMA- or FHLMC-approved mortgage insurer or having a claims paying ability
rating of at least "AA" or equivalent rating by a nationally recognized
statistical rating organization. Any replacement insurer with respect to a
Mortgage Loan must have at least as high a claims paying ability rating as the
insurer it replaces had on the Closing Date.
Quick Loan: Quick Loan Funding Inc., a California corporation, and its
successors in interest.
Quick Loan Agreements: The Quick Loan Purchase Agreement and the Quick
Loan Assignment Agreement, copies of which are attached hereto as Exhibit MM.
Quick Loan Assignment Agreement: The Assignment and Recognition
Agreement, dated as of January 30, 2007, by and among the Unaffiliated Seller,
the Depositor and Quick Loan, and each other Assignment and Recognition
Agreement by and among the Unaffiliated Seller, the Depositor and Quick Loan in
connection with any Subsequent Transfer of Quick Loan Mortgage Loans.
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Quick Loan Mortgage Loan: A Mortgage Loan which was acquired from
Quick Loan by the Unaffiliated Seller pursuant to the Quick Loan Purchase
Agreement, and which has been acquired by the Trust Fund.
Quick Loan Purchase Agreement: The Mortgage Loan Purchase and
Warranties Agreement, dated as of May 1, 2006, as amended to date, by and
between the Unaffiliated Seller and Quick Loan.
Rating Agency: Each of Standard & Poor's, Fitch and Xxxxx'x. If such
organization or a successor is no longer in existence, "Rating Agency" shall be
such nationally recognized statistical rating organization, or other comparable
Person, as is designated by the Depositor, notice of which designation shall be
given to the Trustee and the Securities Administrator. References herein to a
given rating or rating category of a Rating Agency shall mean such rating
category without giving effect to any modifiers. For purposes of Section 10.06,
the addresses for notices to each Rating Agency shall be the address specified
therefor in the definition corresponding to the name of such Rating Agency, or
such other address as such Rating Agency may hereafter furnish to the Depositor,
the Trustee, the Securities Administrator, and the Servicer.
Realized Loss: With respect to each Liquidated Mortgage Loan the
excess (not less than zero or more than the Stated Principal Balance of the
Mortgage Loan) of the unpaid principal balance of a Liquidated Mortgage Loan
together with accrued and unpaid interest thereon over the Liquidation Proceeds,
net of customary out-of-pocket expenses incurred by the Servicer in connection
with the liquidation of such Liquidated Mortgage Loan and net of the amount of
any unreimbursed Servicing Advances with respect to such Liquidated Mortgage
Loan.
Record Date: With respect to any Distribution Date, the close of
business on the Business Day immediately preceding such Distribution Date;
provided, however, that for any Certificate issued in definitive form, the
Record Date shall be the close of business on the last Business Day of the month
immediately preceding the month in which such applicable Distribution Date
occurs.
Reference Bank: As defined in Section 4.04.
Regular Certificates: As specified in the Preliminary Statement.
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. Sections 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. 1506-1631 (January 7, 2005)) or by the
staff of the Commission, or as may be provided by the Commission or its staff
from time to time.
Relief Act Shortfall: With respect to any Distribution Date and any
Mortgage Loan, any reduction in the amount of interest or principal collectible
on such Mortgage Loan for the most recently ended Due Period as a result of the
application of the Servicemembers Civil Relief Act and similar state laws.
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Remainder Amount: As defined in Section 11.01.
REMIC: A "real estate mortgage investment conduit" within the meaning
of section 860D of the Code.
REMIC Adjusted WAC Cap: The weighted average of the interest rates on
the REMIC IV Accretion Directed Classes and the Class IV-Accrual Interest.
REMIC Provisions: Provisions of the federal income tax law relating to
REMICs, which appear at sections 860A through 860G of Subchapter M of Chapter 1
of the Code, and related provisions, and regulations promulgated thereunder, as
the foregoing may be in effect from time to time as well as provisions of
applicable state laws.
REMIC Trust: The segregated pool of assets consisting of the Trust
Fund, exclusive of Prepayment Charges, the Supplemental Interest Trust, the
Excess Reserve Fund Account, the Pre-Funding Account, the Swap Account, the
Pre-Funding Reserve Account, the Capitalized Interest Account, the Interest Rate
Cap Agreement and the Interest Rate Swap Agreement.
REMIC I: As described in the Preliminary Statement.
REMIC I Regular Interest: As described in the Preliminary Statement.
REMIC II: As described in the Preliminary Statement.
REMIC II Regular Interest: As described in the Preliminary Statement.
REMIC III: As described in the Preliminary Statement.
REMIC III Net WAC: The weighted average of the interest rates on the
Class II C1 through Class II C62 Interests and the Class II J1 Interests.
REMIC III Regular Interest: As described in the Preliminary Statement.
REMIC IV: As described in the Preliminary Statement.
REMIC IV Accretion Directed Class: As described in the Preliminary
Statement.
REMIC IV Net WAC: The weighted average of the interest rates on the
Class III-C1a through Class III-C62a, Class III-C1b through Class III-C62b
Interests and the Class III-J1 Interests.
REMIC IV Regular Interest: As described in the Preliminary Statement.
REMIC V: As described in the Preliminary Statement.
REMIC V Regular Interest: As described in the Preliminary Statement.
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Remittance Date: With respect to any Distribution Date, the 21st day
(or if such day is a Saturday, then the first business day immediately preceding
that day, or if such day is a Sunday or otherwise not a Business Day, then the
immediately following Business Day) of the month of the related Distribution
Date.
REO Disposition: The final sale by the Servicer of any REO Property.
REO Imputed Interest: As to any REO Property, for any period, an
amount equivalent to interest (at the Mortgage Rate net of the Servicing Fee
Rate that would have been applicable to the related Mortgage Loan had it been
outstanding) on the unpaid principal balance of the Mortgage Loan as of the date
of acquisition thereof (as such balance is reduced pursuant to Section 3.17 by
any income from the REO Property treated as a recovery of principal).
REO Property: A Mortgaged Property acquired by the Trust Fund through
foreclosure or deed-in-lieu of foreclosure in connection with a defaulted
Mortgage Loan.
Replacement Swap Provider Payment: Any payments that have been
received by the Supplemental Interest Trust as a result of entering into a
replacement interest rate swap agreement following an Additional Termination
Event described in Part 1(q)(iv) or (v) of the Schedule to the Interest Rate
Swap Agreement.
Reportable Event: As defined in Section 8.12(g).
Representative: Xxxxxx Xxxxxxx & Co. Incorporated, as representative
on behalf of itself and IXIS Securities LLC.
Repurchase Price: With respect to any Mortgage Loan, an amount equal
to the sum (without duplication) of (i) the unpaid principal balance of such
Mortgage Loan as of the date of repurchase and (ii) (x) if such Mortgage Loan is
being repurchased by the Unaffiliated Seller, the sum of (A) interest on such
unpaid principal balance of such Mortgage Loan at the Mortgage Rate from the
last date through which interest has been paid and distributed to the Trustee to
the last day of the month in which such repurchase occurs, (B) all xxxxxxxxxxxx
X&X Advances and Servicing Advances, (C) all unpaid Servicing Fees, (D) all
expenses reasonably incurred by the Servicer, the Trustee, the Custodian, the
Securities Administrator, the Master Servicer or the Unaffiliated Seller, as the
case may be, in respect of a breach or defect, including, without limitation,
expenses arising out of any such party's enforcement of the Originator's
repurchase obligation, to the extent not included in (B), and (E) all costs and
expenses incurred by, or on behalf of, the Trust Fund in connection with any
violation by such Mortgage Loan of a predatory or abusive-lending law or (y) if
such Mortgage Loan is being repurchased by the related Originator, the
repurchase price specified in the related Mortgage Loan Purchase Agreement.
Request for Release: The Request for Release submitted by the Servicer
to the Trustee and Custodian, substantially in the form of Exhibit K.
Residual Certificates: As specified in the Preliminary Statement.
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Responsible Officer: When used with respect to the Trustee, the Master
Servicer or the Securities Administrator, as applicable, any vice president, any
assistant vice president, any assistant secretary, any assistant treasurer or
any other officer of the Trustee, the Master Servicer or the Securities
Administrator, as applicable, customarily performing functions similar to those
performed by any of the above designated officers who at such time shall be
officers to whom, with respect to a particular matter, such matter is referred
because of such officer's knowledge of and familiarity with the particular
subject and who, in each case, shall have direct responsibility for the
administration of this Agreement.
Rose: Rose Mortgage, Inc., a New Jersey corporation, and its
successors in interest.
Rose Agreements: The Rose Purchase Agreement and the Rose Assignment
Agreement, copies of which are attached hereto as Exhibit NN.
Rose Assignment Agreement: The Assignment and Recognition Agreement,
dated as of January 30, 2007, by and among the Unaffiliated Seller, the
Depositor and Rose, and each other Assignment and Recognition Agreement by and
among the Unaffiliated Seller, the Depositor and Rose in connection with any
Subsequent Transfer of Rose Mortgage Loans.
Rose Mortgage Loan: A Mortgage Loan which was acquired from Rose by
the Unaffiliated Seller pursuant to the Rose Purchase Agreement, and which has
been acquired by the Trust Fund.
Rose Purchase Agreement: The Third Amended and Restated Mortgage Loan
Purchase and Warranties Agreement, dated as of August 1, 2006, as amended to
date, by and between the Unaffiliated Seller and Rose.
Rule 144A Letter: As defined in Section 5.02(b).
Sarbanes Certification: As defined in Section 8.12(c).
Saxon: Saxon Mortgage Services, Inc., a Texas corporation, and it
successors in interest.
Scheduled Payment: The scheduled monthly payment on a Mortgage Loan
due on any Due Date allocable to principal and/or interest on such Mortgage Loan
which, unless otherwise specified herein, shall give effect to any related Debt
Service Reduction and any Deficient Valuation that affects the amount of the
scheduled payment due on such Mortgage Loan.
Scheduled Principal Balance: With respect to any Mortgage Loan: (a) as
of the Cut-off Date, the outstanding principal balance of such Mortgage Loan as
of such date, net of the principal portion of all unpaid Scheduled Payments, if
any, due on or before such date; (b) as of any Due Date subsequent to the
Cut-off Date up to and including the Due Date in the calendar month in which a
Liquidation Event occurs with respect to such Mortgage Loan, the Scheduled
Principal Balance of such Mortgage Loan as of the Cut-off Date, minus the sum of
(i) the principal portion of each Scheduled Payment due on or before such Due
Date but subsequent to
62
the Cut-off Date, whether or not received, (ii) all Principal Prepayments
received before such Due Date but after the Cut-off Date, (iii) the principal
portion of all Liquidation Proceeds and Insurance Proceeds received before such
Due Date but after the Cut-off Date, net of any portion thereof that represents
principal due (without regard to any acceleration of payments under the related
Mortgage and Mortgage Note) on a Due Date occurring on or before the date on
which such proceeds were received and (iv) any reduction in the principal
balance of such Mortgage Loan incurred with respect thereto as a result of a
Deficient Valuation occurring before such Due Date, but only to the extent such
reduction in principal balance represents a reduction in the portion of
principal of such Mortgage Loan not yet due (without regard to any acceleration
of payments under the related Mortgage and Mortgage Note) as of the date of such
Deficient Valuation; and (c) as of any Due Date subsequent to the occurrence of
a Liquidation Event with respect to such Mortgage Loan, zero.
Sebring: Sebring Capital Partners, LP, a Delaware limited partnership,
and its successors in interest.
Sebring Mortgage Loan: A Mortgage Loan which was acquired from Sebring
by the Unaffiliated Seller pursuant to the Sebring Purchase Agreement, and which
has been acquired by the Trust Fund.
Sebring Purchase Agreement: The Mortgage Loan Purchase and Warranties
Agreement, dated as of October 1, 2006, as amended to date, by and between the
Unaffiliated Seller and Sebring , a copy of which is attached hereto as Exhibit
OO.
Second Lien Mortgage Loan: A Mortgage Loan secured by a second lien
Mortgage on the related Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Securities Administrator: Xxxxx Fargo Bank, National Association, a
banking association organized under the laws of the United States, and its
successors and assigns, in its capacity as Securities Administrator hereunder.
Securities Administrator and Master Servicer Fee: With respect to any
Distribution Date, an amount equal to the product of (a) one-twelfth of the
Securities Administrator and Master Servicer Fee Rate and (b) the sum of (i) the
Stated Principal Balance of the Mortgage Loans as of the prior Distribution Date
(or as of the Cut-off Date in the case of the first Distribution Date) and (ii)
the Pre-Funding Amount.
Securities Administrator and Master Servicer Fee Rate: With respect to
each Mortgage Loan, 0.0050% per annum.
Senior Defaulted Swap Termination Payment: As of any date, the lesser
of (x) any Replacement Swap Provider Payment and (y) any Defaulted Swap
Termination Payment owed to the Swap Provider.
Senior Enhancement Percentage: With respect to any Distribution Date,
the percentage obtained by dividing (x) the sum of (i) the aggregate Class
Certificate Balance of the
63
Subordinated Certificates and (ii) the Subordinated Amount (in each case after
taking into account the distribution of the Principal Distribution Amount and
any principal payments on those Classes of Certificates from the Swap Account
for such Distribution Date) by (y) the Current Maximum Amount for that
Distribution Date.
Senior Specified Enhancement Percentage: As of any date of
determination, 40.30%.
Servicer: Saxon Mortgage Services, Inc., a Texas corporation, its
successors and assigns, in its capacity as the Servicer hereunder.
Servicer Remittance Report: As defined in Section 4.03(c).
Servicing Advances: The reasonable "out-of-pocket" costs and expenses
(including legal fees) incurred by the Servicer in the performance of its
servicing obligations in connection with a default, delinquency or other
unanticipated event, including, but not limited to, the cost of (i) the
preservation, restoration, inspection and protection of a Mortgaged Property,
(ii) any enforcement, administrative or judicial proceedings, including
foreclosures and litigation, in respect of a particular Mortgage Loan, (iii) the
management (including reasonable fees in connection therewith) and liquidation
of any REO Property and (iv) the performance of its obligations under Section
3.01, Section 3.09, Section 3.13 and Section 3.15. Servicing Advances also
include any reasonable "out-of-pocket" costs and expenses (including legal fees)
incurred by the Servicer in connection with executing and recording instruments
of satisfaction, deeds of reconveyance or Assignments of Mortgage in connection
with any foreclosure in respect of any Mortgage Loan to the extent not recovered
from the Mortgagor or otherwise payable under this Agreement. The Servicer shall
not be required to make any Nonrecoverable Servicing Advances.
Servicing Criteria: The "servicing criteria" set forth in Item 1122(d)
of Regulation AB, which as of the Closing Date are listed on Exhibit Q hereto.
Servicing Fee: With respect to the Servicer and each Mortgage Loan and
for any calendar month, an amount equal to one month's interest (or in the event
of any payment of interest which accompanies a Principal Prepayment in Full made
by the Mortgagor during such calendar month, interest for the number of days
covered by such payment of interest) at the Servicing Fee Rate on the applicable
Stated Principal Balance of such Mortgage Loan as of the first day of the
related Due Period (or the Cut-off Date, in the case of the First Distribution
Date). Such fee shall be payable monthly, and shall be pro rated for any portion
of a month during which the Mortgage Loan is serviced by the Servicer under this
Agreement. The Servicing Fee is payable solely from, the interest portion
(including recoveries with respect to interest from Liquidation Proceeds,
Insurance Proceeds, Condemnation Proceeds and proceeds received with respect to
REO Properties, to the extent permitted by Section 3.11) of such Scheduled
Payment collected by the Servicer, or as otherwise provided under Section 3.11.
Servicing Fee Rate: With respect to each Mortgage Loan, 0.50% per
annum.
Servicing File: With respect to each Mortgage Loan, the file retained
by the Servicer consisting of originals or copies of all documents in the
Mortgage File which are not
64
delivered to the Custodian in the Custodial File and copies of each of the other
Mortgage Loan documents required to be delivered by the related Originator
pursuant to the terms of the related Mortgage Loan Purchase Agreement.
Servicing Function Participant: As defined in Section 3.23(a).
Servicing Officer: Any officer of the Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose
name and facsimile signature appear on a list of servicing officers furnished to
the Trustee, the Securities Administrator, the Master Servicer and the Custodian
by the Servicer on the Closing Date pursuant to this Agreement, as such list may
from time to time be amended.
Servicing Transfer Date: With respect to each Mortgage Loan, the date
on which Saxon commenced servicing such Mortgage Loan, as set forth on the
Mortgage Loan Schedule.
Servicing Trigger Event: With respect to each Determination Date, a
Servicing Trigger Event exists if total Cumulative Loss Percentage exceeds: (i)
8.50% on any Determination Date up to, and including, the fifth anniversary of
the Cut-off Date; or (ii) 10.82% on any Determination Date from the fifth to,
and including, the tenth anniversary of the Cut-off Date. Following the tenth
anniversary of the Cut-off Date, no Servicing Trigger Event shall exist.
Specified Subordinated Amount: With respect to any Distribution Date
prior to the Stepdown Date, an amount equal to 2.10% of the Maximum Pool
Principal Balance; and with respect to any Distribution Date on and after the
Stepdown Date, an amount equal to 4.20% of the Current Maximum Amount for that
Distribution Date subject to a minimum amount equal to 0.50% of the Maximum Pool
Principal Balance; provided, however, that if, on any Distribution Date, a
Trigger Event exists, the Specified Subordinated Amount shall not be reduced to
the applicable percentage of the Current Maximum Amount, but instead will remain
the same as the prior period's Specified Subordinated Amount until the
Distribution Date on which a Trigger Event no longer exists. When the Class
Certificate Balance of each Class of LIBOR Certificates has been reduced to
zero, the Specified Subordinated Amount shall thereafter equal zero.
Standard & Poor's: Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies, Inc., and its successors in interest. If Standard &
Poor's is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 10.06 the address for notices to Standard & Poor's shall be
Standard & Poor's, 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Residential Mortgage Surveillance Group - IXIS Real Estate Capital Trust
2007-HE1, or such other address as Standard & Poor's may hereafter furnish to
the Depositor, the Trustee, the Securities Administrator and the Servicer.
Standard & Poor's Glossary: The Standard & Poor's LEVELS(R) Glossary,
as may be in effect from time to time.
Startup Day: For each REMIC created hereunder, the Closing Date.
Stated Principal Balance: As to each Mortgage Loan and as of any date
of determination, (i) the principal balance of the Mortgage Loan at the Cut-off
Date after giving
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effect to payments of principal due on or before such date, to the extent
actually received, minus (ii) all amounts previously remitted to the Securities
Administrator with respect to the related Mortgage Loan representing payments or
recoveries of principal, including Advances in respect of Scheduled Payments of
principal. For purposes of any Distribution Date, the Stated Principal Balance
of any Mortgage Loan will give effect to any Scheduled Payments of principal
received by the Servicer on or prior to the related Determination Date or
advanced by the Servicer prior to the related Remittance Date and any
unscheduled principal payments and other unscheduled principal collections
received during the related Prepayment Period, and the Stated Principal Balance
of any Mortgage Loan that has prepaid in full or has become a Liquidated
Mortgage Loan during the related Prepayment Period shall be zero.
Stepdown Date: The later to occur of (i) the earlier to occur of (a)
the Distribution Date in February 2010 and (b) the Distribution Date on which
the aggregate Class Certificate Balance of the Class A Certificates have been
reduced to zero and (ii) the first Distribution Date on which the Senior
Enhancement Percentage (calculated for this purpose only after taking into
account scheduled and unscheduled payments of principal on the Mortgage Loans on
the last day of the related Due Period but prior to any allocation of the
Principal Distribution Amount together with any principal payments from the Swap
Account to the LIBOR Certificates on the applicable Distribution Date) is
greater than or equal to the Senior Specified Enhancement Percentage.
Subcontractor: Any third-party or Affiliated vendor, subcontractor or
other Person utilized by the Servicer, a Subservicer, or the Master Servicer or
the Securities Administrator, as applicable, 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.
Subordinated Amount: With respect to any Distribution Date, the
excess, if any, of (a) the Current Maximum Amount for that Distribution Date on
such Distribution Date over (b) the aggregate of the Class Certificate Balances
of the LIBOR Certificates as of such Distribution Date plus, except for federal
income tax purposes, the Class Certificate Balances of the Class P Certificates
(after giving effect to the payment of the Principal Remittance Amount on such
Certificates on such Distribution Date).
Subordinated Certificates: As specified in the Preliminary Statement.
Subordination Deficiency: With respect to any Distribution Date, the
excess, if any, of (a) the Specified Subordinated Amount applicable to such
Distribution Date over (b) the Subordinated Amount applicable to such
Distribution Date.
Subordination Reduction Amount: With respect to any Distribution Date,
an amount equal to the lesser of (a) the Excess Subordinated Amount and (b) the
Net Monthly Excess Cash Flow.
Subsequent Recovery: With respect to any Mortgage Loan or related
Mortgaged Property that became a Liquidated Mortgage Loan or was otherwise
disposed of, all amounts
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received in respect of such Liquidated Mortgage Loan after an Applied Realized
Loss Amount related to such Mortgage Loan or Mortgaged Property is allocated to
reduce the Class Certificate Balance of any Class of Subordinated Certificates.
Any Subsequent Recovery that is received during a Prepayment Period will be
treated as Liquidation Proceeds and included as part of the Principal Remittance
Amount for the related Distribution Date.
Subsequent Cut-off Date: As to any Subsequent Mortgage Loans, the date
specified in the addition notice delivered in connection therewith, which date
shall be the close of business on the first day of the month in which such
Subsequent Mortgage Loans will be conveyed to the Trust Fund.
Subsequent Mortgage Loans: The Mortgage Loans hereafter transferred
and assigned to the Trust Fund pursuant to Section 2.01(c), each of which shall
have been purchased by the Unaffiliated Seller under a Mortgage Loan Purchase
Agreement.
Subsequent Transfer: The transfer and assignment by the Depositor to
the Trust of the Subsequent Mortgage Loans pursuant to the terms hereof.
Subsequent Transfer Agreement: A subsequent transfer agreement in
substantially the form of Exhibit L.
Subsequent Transfer Date: The Business Day on which a Subsequent
Transfer occurs.
Subservicer: Any Person that services Mortgage Loans on behalf of the
Servicer 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 Servicer under
this Agreement, with respect to some or all of the Mortgage Loans, that are
identified in Item 1122(d) of Regulation AB.
Subservicing Account: As defined in Section 3.08.
Subservicing Agreement: As defined in Section 3.02(a).
Substitute Mortgage Loan: A Mortgage Loan substituted by the
Unaffiliated Seller or an Originator for a Deleted Mortgage Loan in accordance
with the terms of this Agreement or the related Mortgage Loan Purchase
Agreement, as applicable, which must, on the date of such substitution, as
confirmed in a Request for Release, substantially in the form of Exhibit K, (i)
have a Stated Principal Balance, after deduction of the principal portion of the
Scheduled Payment due in the month of substitution, not in excess of, and not
more than 10% less than, the Stated Principal Balance of the Deleted Mortgage
Loan; (ii) be accruing interest at a rate no lower than and not more than 1% per
annum higher than, that of the Deleted Mortgage Loan; (iii) have a Loan-to-Value
Ratio no higher than that of the Deleted Mortgage Loan; (iv) have a remaining
term to maturity no greater than (and not more than one year less than that of)
the Deleted Mortgage Loan; and (v) comply with each representation and warranty
set forth in Sections 3.01(f), 3.01(h), 3.01(n), 3.01(o), 3.01(p) and 3.03 of
the Unaffiliated Seller's Agreement, each representation and warranty set forth
in the applicable Mortgage Loan Purchase Agreement and each of the requirements
set forth in Sections 2.01(c) hereof.
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Substitution Adjustment Amount: The meaning ascribed to such term
pursuant to Section 2.03(d).
Supplemental Interest Trust: IXIS Real Estate Capital Supplemental
Interest Trust 2007-HE1 established pursuant to Section 2.01(d).
Swap Account: The separate Eligible Account created and maintained by
the Securities Administrator pursuant to Section 3.07(m) in the name of the
Securities Administrator, on behalf of the Supplemental Interest Trust, for the
benefit of the Certificateholders and the Swap Provider, and designated "Xxxxx
Fargo Bank, National Association, in trust for registered holders of IXIS Real
Estate Capital Trust 2007-HE1, Mortgage Pass-Through Certificates, Series
2007-HE1 and IXIS Financial Products, Inc.".
Swap Payment Rate: For any Distribution Date, a fraction, the
numerator of which is any Net Swap Payment or Swap Termination Payment (other
than a Defaulted Swap Termination Payment) owed to the Swap Provider for such
Distribution Date and the denominator of which is the Stated Principal Balance
of the mortgage loans at the beginning of the related Due Period plus amounts in
the Pre-Funding Account, multiplied by 12.
Swap Provider: IXIS Financial Products Inc., a Delaware corporation,
and any successor thereto.
Swap Termination Payment: A termination payment required to be made by
either the Supplemental Interest Trust or the Swap Provider pursuant to the
Interest Rate Swap Agreement as a result an Event of Default (as defined in the
Interest Rate Swap Agreement) or a Termination Event (as defined in the Interest
Rate Swap Agreement).
Tax Matters Person: The Holder of the Class R Certificates designated
as "tax matters person" of REMIC I, REMIC II, REMIC III, REMIC IV and REMIC V,
respectively, in the manner provided under Treasury regulations section
1.860F-4(d) and Treasury regulations section 301.6231(a)(7)-1.
Tax Service Contract: As defined in Section 3.09(a).
Telerate Page 3750: The display page currently so designated on the
Bridge Telerate Service (or such other page as may replace that page on that
service for displaying comparable rates or prices).
Termination Price: As defined in Section 11.01.
Total Monthly Excess Spread: As to any Distribution Date, an amount
equal to the excess if any, of (i) the interest on the Mortgage Loans received
by the Servicer on or prior to the related Determination Date (other than
Prepayment Interest Excesses) or advanced by the Servicer for the related
Remittance Date (net of Expense Fees) over (ii) the sum of the amounts payable
to the LIBOR Certificates pursuant to Section 4.02(a)(i) and Net Swap Payments
and Swap Termination Payment (other than a Defaulted Swap Termination Payment
that is not a Senior Defaulted Swap Termination Payment) to the Swap Provider on
such Distribution Date.
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Transfer: Any direct or indirect transfer or sale of any Ownership
Interest in a Residual Certificate.
Transfer Affidavit: As defined in Section 5.02(c).
Transferor Certificate: As defined in Section 5.02(b).
Trigger Event: The occurrence of either a Delinquency Trigger Event or
a Cumulative Loss Trigger Event.
Trust: The express trust created hereunder in Section 2.01(d).
Trust Fund: The corpus of the trust created hereunder consisting of
(i) the Mortgage Loans and all interest and principal received on or with
respect thereto after the related Cut-off Date, other than such amounts which
were due on the Mortgage Loans on or before the related Cut-off Date; (ii) each
Account, other than the Swap Account and the Excess Reserve Fund Account, and
all amounts deposited therein pursuant to the applicable provisions of this
Agreement; (iii) property that secured a Mortgage Loan and has been acquired by
foreclosure, deed-in-lieu of foreclosure or otherwise; (iv) all rights of the
Depositor against the Unaffiliated Seller under the Unaffiliated Seller's
Agreement; (v) all rights of the Depositor against each Originator under the
related Assignment and Recognition Agreement and the related Mortgage Loan
Purchase Agreement; (vi) the Interest Rate Swap Agreement and the Interest Rate
Cap Agreement; and (vi) all proceeds of the conversion, voluntary or
involuntary, of any of the foregoing.
Trustee: Deutsche Bank National Trust Company, a national banking
association, and its successors in interest and, if a successor trustee is
appointed hereunder, such successor.
Unaffiliated Seller's Agreement: The Unaffiliated Seller's Agreement,
dated as of the date hereof, among the Unaffiliated Seller and the Depositor
relating to the sale of the Mortgage Loans from the Unaffiliated Seller to the
Depositor.
Underwriter: Xxxxxx Xxxxxxx & Co. Incorporated.
Underwriters' Exemption: Prohibited Transaction Exemption 90-24, as
amended.
Unpaid Interest Amount: As of any Distribution Date and any Class of
Certificates, the sum of (a) the excess of (i) the sum of the Accrued
Certificate Interest for such Distribution Date and any portion of such Accrued
Certificate Interest from prior Distribution Dates remaining unpaid over (ii)
the amount in respect of interest on such Class of Certificates actually
distributed on that Distribution Date and (b) 30 days' interest on the amount in
clause (a) above at the applicable Pass-Through Rate (to the extent permitted by
applicable law).
Unpaid Realized Loss Amount: With respect to any Class of Subordinated
Certificates and as to any Distribution Date, is the excess of (i) the Applied
Realized Loss Amount with respect to such Class over (ii) the sum of (without
duplication) (a) all distributions in reduction of such Applied Realized Loss
Amounts on all previous Distribution Dates and (b) the amount by which the Class
Certificate Balance of such Class has been increased due to
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the distribution of any Subsequent Recoveries on all previous Distribution
Dates. Any amounts distributed to a Class of Subordinated Certificates in
respect of any Unpaid Realized Loss Amount will not be applied to reduce the
Class Certificate Balance of such Class.
U.S. Person: (i) A citizen or resident of the United States; (ii) a
corporation (or entity treated as a corporation for tax purposes) created or
organized in the United States or under the laws of the United States or of any
State thereof, including, for this purpose, the District of Columbia; (iii) a
partnership (or entity treated as a partnership for tax purposes) organized in
the United States or under the laws of the United States or of any State
thereof, including, for this purpose, the District of Columbia (unless provided
otherwise by future Treasury regulations); (iv) an estate whose income is
includible in gross income for United States income tax purposes regardless of
its source; or (v) a trust, if a court within the United States is able to
exercise primary supervision over the administration of the trust and one or
more U.S. Persons have authority to control substantial decisions of the trust.
Notwithstanding the last clause of the preceding sentence, to the extent
provided in Treasury regulations, certain trusts in existence on August 20,
1996, and treated as U.S. Persons prior to such date, may elect to continue to
be U.S. Persons.
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. As of any date of
determination, (a) 1% of all Voting Rights shall be allocated to the Class X
Certificates, if any (such Voting Rights to be allocated among the Holders of
Certificates of each such Class in accordance with their respective Percentage
Interests), (b) 1% of all Voting Rights shall be allocated to the Class P
Certificates, if any, and (c) the remaining Voting Rights shall be allocated
among Holders of the remaining Classes of Certificates in proportion to the
Certificate Balances of their respective Certificates on such date.
WAC Cap: With respect to the Mortgage Loans as of any Distribution
Date, the product of (i) the weighted average of the Adjusted Net Mortgage Rates
then in effect on the beginning of the related Due Period on the Mortgage Loans,
less the Swap Payment Rate, and (ii) a fraction, the numerator of which is 30
and the denominator of which is the actual number of days in the Interest
Accrual Period related to such Distribution Date.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Mortgage Loans.
(a) The Depositor, concurrently with the execution and delivery
hereof, hereby sells, transfers, assigns, sets over and otherwise conveys to the
Trustee for the benefit of the Certificateholders, without recourse, all the
right, title and interest of the Depositor in and to the Trust Fund and the
Trustee, on behalf of the Trust, hereby accepts the Trust Fund, other than any
Subsequent Mortgage Loans, which will be so sold, transferred, assigned,
set-over and conveyed on the related Subsequent Transfer Date. The Mortgage
Loans permitted by the terms of this Agreement to be included in the Trust Fund
are limited to (i) the Initial Mortgage Loans (which the Depositor is required
hereunder to have acquired pursuant to Subsequent Transfer
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Agreements) and (iii) Substitute Mortgage Loans. It is agreed and understood by
the parties hereto that it is not intended that any Mortgage Loan be included in
the Trust Fund that is a High Cost Loan. On the Closing Date, the Depositor
shall pay, without any right of reimbursement from the Trust, to the Cap
Provider the "Fixed Amount" (as defined in the Interest Rate Cap Agreement) due
and payable to the Cap Provider pursuant to the terms of the Interest Rate Cap
Agreement.
(b) In connection with the transfer and assignment of each Mortgage
Loan, the Unaffiliated Seller has delivered or caused to be delivered to the
Custodian for the benefit of the Certificateholders the following documents or
instruments with respect to each Mortgage Loan so assigned (to the extent such
documents or instruments are required to be delivered by the related Originator
under each Mortgage Loan Purchase Agreement):
(i) the original Mortgage Note bearing all intervening
endorsements evidencing a complete chain of assignment from the originator
to the related Originator, endorsed "Pay to the order of _________, without
recourse" and signed in the name of the related Originator by an authorized
officer. To the extent that there is no room on the face of the Mortgage
Notes for endorsements, the endorsement may be contained on an allonge,
unless the Trustee and the Custodian are advised by the related Originator
that state law does not so allow. If the Mortgage Loan was acquired by an
Originator in a merger, the endorsement must be by "[related Originator],
successor by merger to [name of predecessor]". If the Mortgage Loan was
acquired or originated by the related Originator while doing business under
another name, the endorsement must be by "[related Originator], formerly
known as [previous name]";
(ii) the original of any guarantee executed in connection with
the Mortgage Note;
(iii) the original Mortgage with evidence of recording thereon.
If in connection with any Mortgage Loan, the original Mortgage with
evidence of recording thereon cannot be delivered on or prior to the
related Delivery 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, then the related Originator, as required by
the terms of the related Mortgage Loan Purchase Agreement, will be required
to deliver to the Custodian, on behalf of the Trustee, a photocopy of such
Mortgage and (i) 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 promptly upon receipt thereof by the related
Originator (but in any event within 360 days from the related Delivery
Date); 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 to be a true and
complete copy of the original recorded Mortgage;
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(iv) the originals of all assumption, modification, consolidation
or extension agreements, if any, with evidence of recording thereon;
(v) the original Assignment of Mortgage for each Mortgage Loan
endorsed in blank, in form and substance acceptable for recording (except
with respect to MERS Designated Mortgage Loans);
(vi) the originals of all intervening assignments of mortgage,
evidencing a complete chain of assignment from the originator (or MERS with
respect to each MERS Designated Mortgage Loan) to the related Originator,
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;
(vii) the original or duplicate lender's title policy and all
riders thereto or, if such original is unavailable, either an original
title binder or an original or copy of the title commitment, and if copies
then certified to be true and complete by the title company; and
(viii) the security agreement, chattel mortgage or equivalent
document executed in connection with the Mortgage, if any.
If any Mortgage has been recorded in the name of MERS, no Assignment
of Mortgage in favor of the Trustee will be required to be prepared or delivered
and instead, the Servicer shall take all reasonable actions as are necessary at
the expense of the applicable Originator to the extent permitted under the
related Purchase Agreement and otherwise at the expense of the Depositor to
cause the Trustee to be shown as Investor of the related Mortgage Loan on the
records of MERS for the purpose of the system of recording transfers of
beneficial ownership of mortgages maintained by MERS. Within 90 days after the
Closing Date, the Trustee shall, for the benefit of the Holders of the
Certificates, based solely on the list of MERS Designated Mortgage Loans and
screen printouts from the MERS system provided to the Trustee by the
Unaffiliated Seller (such to be provided to the Trustee no later than 45 days
from the Closing Date), the Trustee shall confirm, on behalf of the Trust, that
the Trustee is shown as the Investor with respect to each MERS Designated
Mortgage Loan on such screen printouts. If the Trustee is not shown as the
Investor with respect to any MERS Designated Mortgage Loans on such screen
printouts, the Trustee shall promptly notify the Unaffiliated Seller of such
fact and the Unaffiliated Seller shall then either cure such defect or
repurchase such Mortgage Loan in accordance with Section 2.03.
From time to time, the Servicer shall forward to the Custodian
additional original documents, additional documents evidencing an assumption,
modification, consolidation or extension of a Mortgage Loan approved by the
Servicer, in accordance with the terms of this Agreement. All such mortgage
documents held by the Custodian as to each Mortgage Loan shall constitute the
"Custodial File".
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On or prior to the related Delivery Date, the Unaffiliated Seller
shall deliver, or cause the related Originator to deliver, to the Custodian
Assignments of Mortgage, in blank, for each Mortgage Loan. If an Assignment of
Mortgage is required to be recorded pursuant to the terms hereof, the Servicer,
or the Servicer's designee shall direct the Custodian to promptly forward such
Assignment of Mortgage to the Servicer for recording. No later than thirty (30)
Business Days following the date of receipt by the Servicer of all necessary
recording information for a Mortgage, the Servicer shall promptly submit or
cause to be submitted for recording, at the expense of the Unaffiliated Seller
(the Unaffiliated Seller to seek reimbursement from the related Originator under
the applicable Mortgage Loan Purchase Agreement) in the appropriate public
office for real property records, each Assignment of Mortgage referred to in
Section 2.01(b)(v). Notwithstanding the foregoing, however, for administrative
convenience and facilitation of servicing and to reduce closing costs, the
Assignment of Mortgage shall not be required to be completed and submitted for
recording with respect to any MERS Designated Mortgage Loan or any Mortgage Loan
(other than any Mortgage Loan where the Mortgaged Property is located in any
state where recordation is required by any Rating Agency to obtain the initial
ratings on the Certificates, which states as of the date hereof, are Florida and
Maryland) upon a determination by the Servicer that recordation is necessary for
the enforcement of rights under, or satisfaction or assignment of, the related
Mortgage, at which time, the Servicer shall record any such Assignment of
Mortgage in accordance with the terms hereof. If any Assignment of Mortgage is
required to be recorded pursuant to the terms hereof, the Mortgage shall be
assigned from the related Originator, to "Deutsche Bank National Trust Company,
as trustee under the Pooling and Servicing Agreement dated as of January 1,
2007, IXIS Real Estate Capital Trust 2007-HE1." In the event that any such
assignment is lost or returned unrecorded because of a defect therein, the
Unaffiliated Seller shall cause the related Originator to promptly prepare a
substitute assignment to cure such defect and thereafter cause each such
assignment to be duly recorded. In the event the Unaffiliated Seller does not
pay or otherwise reimburse the Servicer for any of the foregoing costs of
recording any such Assignment of Mortgage, the Servicer shall be entitled to be
reimbursed from the Trust Fund from amounts on deposit in its Collection
Account. In the event the related Originator fails to reimburse the Unaffiliated
Seller for the recording costs described above, upon receipt of written
direction from the Unaffiliated Seller, the Trustee shall assign its rights
under the applicable Mortgage Loan Purchase Agreement solely with respect to
payment of such expenses to the Unaffiliated Seller.
The Unaffiliated Seller shall use commercially reasonable efforts to
assist the Servicer in causing the related Originator to deliver (at the expense
of such Originator pursuant to the related Mortgage Loan Purchase Agreement) to
the Servicer copies of all trailing documents required to be included in the
Custodial File at the same time the originals or certified copies thereof are
delivered to the Custodian, such documents, including, but not limited to, the
mortgagee policy of title insurance and any mortgage loan documents upon return
from the recording office. The Unaffiliated Seller shall use commercially
reasonable efforts to assist the Servicer in seeking reimbursement from the
related Originator pursuant to the related Mortgage Loan Purchase Agreement for
any fees or costs incurred by the Servicer in obtaining such documents.
On or prior to the Closing Date, the Unaffiliated Seller shall deliver
to the Trustee, the Custodian, the Securities Administrator, the Master Servicer
and the Servicer a copy of the Data Tape Information in electronic, machine
readable medium in a form mutually
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acceptable to the Custodian, the Trustee, the Securities Administrator, the
Master Servicer and the Servicer. Within ten days of the Closing Date, the
Unaffiliated Seller shall deliver a copy of the complete Mortgage Loan Schedule
to the Custodian, the Trustee, the Securities Administrator, the Master Servicer
and the Servicer.
In the event that such original or copy of any document submitted for
recordation to the appropriate public recording office is not so delivered to
the Custodian within 90 days following the related Delivery Date, as evidenced
by the Custodian's Final Certification, and in the event that the Originator
does not cure such failure within 30 days of discovery or receipt of written
notification of such failure from the Depositor, the Trustee, the Securities
Administrator, the Master Servicer or the Custodian, then the Trustee shall
notify the related Originator to repurchase the Mortgage Loan pursuant to the
related Mortgage Loan Purchase Agreement, upon the request of the Depositor, the
Trustee or the Securities Administrator, at the Repurchase Price and in the
manner specified in Section 2.03. The foregoing repurchase provision shall not
apply in the event that the related Originator cannot deliver such original or
copy of any document submitted for recordation to the appropriate public
recording office within the specified period due to a delay caused by the
recording office in the applicable jurisdiction; provided that the related
Originator shall instead be required to deliver a recording receipt of such
recording office or, if such recording receipt is not available, an officer's
certificate of a servicing officer of the Originator confirming that such
document has been accepted for recording.
(c) Purchase and Sale of Subsequent Mortgage Loans.
(i) Subject to the satisfaction of the conditions set forth in
paragraph (ii) below, and upon the Securities Administrator's receipt of a
Subsequent Transfer Agreement executed by all other parties thereto, in
consideration of the Securities Administrator's delivery on the related
Subsequent Transfer Dates to or upon the order of the Depositor of all or a
portion of the balance of funds in the Pre-Funding Account, the Depositor
shall on any Subsequent Transfer Date sell, transfer, assign, set over and
convey to the Trustee without recourse but subject to terms and provisions
of this Agreement, all of the right, title and interest of the Depositor in
and to the Subsequent Mortgage Loans, including the outstanding principal
of and interest due on such Subsequent Mortgage Loans, and all other
related assets included or to be included in the Trust Fund with respect
thereto.
The amount released from the Pre-Funding Account with respect to a
transfer of Subsequent Mortgage Loans shall be one-hundred percent (100%)
of the aggregate Stated Principal Balances as of the related Subsequent
Cut-off Date of the Subsequent Mortgage Loans so transferred.
(ii) The Subsequent Mortgage Loans and the other property and
rights related thereto described in paragraph (a) above shall be
transferred by the Depositor to the Trust Fund only upon the satisfaction
of each of the following conditions on or prior to the related Subsequent
Transfer Date:
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(a) the Unaffiliated Seller shall have provided the Depositor, the
Trustee, the Securities Administrator and the Rating Agencies
with a timely addition notice, which shall include a Mortgage
Loan Schedule, listing the Subsequent Mortgage Loans and shall
have provided any other information reasonably requested by any
of the foregoing with respect to the Subsequent Mortgage Loans;
(b) the Servicer shall have deposited in the Collection Account all
collections of (x) principal in respect of the Subsequent
Mortgage Loans received and due after the related Subsequent
Cut-off Date and (y) interest due on the Subsequent Mortgage
Loans after the related Subsequent Cut-off Date;
(c) as of each Subsequent Transfer Date, the Unaffiliated Seller was
not insolvent nor will be made insolvent by such transfer nor is
the Unaffiliated Seller aware of any pending insolvency;
(d) such addition will not result in a "prohibited transaction" (as
defined in the REMIC Provisions) for any REMIC created hereunder,
and will not cause any REMIC created hereunder to cease to
qualify as a REMIC, as evidenced by an Opinion of Counsel with
respect to such matters (which may be a blanket opinion dated the
Closing Date);
(e) the Pre-Funding Period shall not have terminated;
(f) the Unaffiliated Seller shall have delivered to the Securities
Administrator an executed Assignment and Recognition Agreement
with respect to each related Originator of Subsequent Mortgage
Loans to be added to the Trust Fund on such Subsequent Transfer
Date (which Assignment and Recognition Agreement shall include a
representation and warranty from the related Originator that none
of the Subsequent Mortgage Loans is a High Cost Loan, none of the
Subsequent Mortgage Loans is covered by the Home Ownership and
Equity Protection Act of 1994 and none of the Subsequent Mortgage
Loans is in violation of any comparable state law);
(g) each of the Rating Agencies shall have notified the Unaffiliated
Seller of its consent to the transfer of the Subsequent Mortgage
Loans to the Trust Fund which will be evidenced to the Trustee in
writing;.
(h) the parties to this Agreement shall have delivered to the
Securities Administrator an executed copy of a Subsequent
Transfer Agreement, substantially in the form of Exhibit L
hereto;
(i) the Unaffiliated Seller shall have delivered to the Securities
Administrator an Officer's Certificate confirming the
satisfaction of each condition precedent specified in this
paragraph (ii), and the Opinion of Counsel referenced in clause
(d);
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The Trustee shall have no obligation to monitor or otherwise determine
the compliance of any other party with the foregoing conditions, and shall
have no liability for any such noncompliance.
(iii) The obligation of the Trust Fund to purchase the Subsequent
Mortgage Loans on a Subsequent Transfer Date is subject to the requirements
that, following the purchase of such Subsequent Mortgage Loans, with
respect to the entire mortgage loan pool:
(A) no more than 5.00% may be second lien mortgage loans;
(B) no more than 37.00% may be first lien mortgage loans which are
secured by Mortgaged Properties which also secure second lien
mortgage loans;
(C) no less than 18.00% and no more than 23.00% may be Fixed Rate
Mortgage Loans;
(D) the weighted average original term to maturity may not exceed 360
months;
(E) the weighted average gross Mortgage Rate must not be less than
8.300%, or more than 8.700%;
(F) the weighted average original LTV must not exceed 81.50%, and no
more than 32.50% of the Mortgage Loans may have LTVs in excess of
80.00%;
(G) at least 75.00% of the Mortgage Loans must have Prepayment
Charges;
(H) the weighted average Gross Margin for the Adjustable Rate
Mortgage Loans must be at least 6.100%;
(I) the weighted average credit score (FICO Score) must be at least
620, and none of the Mortgage Loans may have credit scores below
500;
(J) the weighted average credit score for the second-lien mortgage
loans must be at least 645;
(K) no more than 25.00% may have an interest-only period;
(L) the weighted average initial periodic rate cap for the Adjustable
Rate Mortgage Loans may not exceed 3.100%
(M) no mortgage loan is classified as a "high cost" loan under the
Home Ownership and Equity Protection Act of 1994 ("HOEPA") and no
mortgage loan is in violation of, or classified as a "high cost,"
"threshold," "predatory" or similar loan under, any other
applicable state, federal or local law;
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Any of the requirements set forth in clauses (ii) and (iii) above may
be waived or modified in any respect with the consent of the Rating
Agencies.
(iv) In connection with the transfer and assignment of the
Subsequent Mortgage Loans, the Unaffiliated Seller shall satisfy the
document delivery requirements set forth in Section 2.01(b).
(d) The Depositor does hereby establish, pursuant to the further
provisions of the Agreement and the laws of the State of New York, an express
trust (the "Trust") to be known, for convenience, as "IXIS REAL ESTATE CAPITAL
TRUST 2007-HE1" and Deutsche Bank National Trust Company is hereby appointed as
Trustee in accordance with the provisions of this Agreement. The parties hereto
acknowledge and agree that it is the policy and intention of the Trust to
acquire only Mortgage Loans meeting the requirements set forth in this
Agreement. In addition Depositor does hereby establish, pursuant to the further
provisions of the Agreement and the laws of the State of New York, an express
trust (the "Supplemental Interest Trust") to be known, for convenience, as "IXIS
REAL ESTATE CAPITAL SUPPLEMENTAL INTEREST TRUST 2007-HE1", which, as a subtrust
of the Trust Fund, will hold the Interest Rate Swap Agreement, the Swap Account
and the Excess Reserve Fund Account.
(e) The Trust shall have the capacity, power and authority, and the
Trustee on behalf of the Trust is hereby authorized, to accept the sale,
transfer, assignment, set over and conveyance by the Depositor to the Trust of
all the right, title and interest of the Depositor in and to the Trust Fund
(including, without limitation, the Mortgage Loans) pursuant to Section 2.01(a).
The Securities Administrator is hereby authorized and directed to execute the
Interest Rate Swap Agreement on behalf of the Supplemental Interest Trust.
Section 2.02 Acceptance by the Custodian of the Mortgage Loans.
The Custodian shall acknowledge, on each Delivery Date, receipt of the
documents identified in the Initial Certification in the form annexed hereto as
Exhibit F, and declares that it holds and will hold such documents and the other
documents delivered to it pursuant to Section 2.01, and that it holds or will
hold such other assets as are included in the Trust Fund, on behalf of the
Trustee, in trust for the exclusive use and benefit of all present and future
Certificateholders. The Custodian acknowledges that it will maintain possession
of the related Mortgage Notes in the State of California, unless otherwise
permitted under this Agreement or by the Rating Agencies.
In connection with each Delivery, the Custodian shall deliver or cause
to be delivered via facsimile or original to the Depositor, the Trustee, the
Securities Administrator, the Unaffiliated Seller and the Servicer an Initial
Certification on or prior to the related Delivery Date, certifying receipt of
the related Mortgage Notes and Assignments of Mortgage for each related Mortgage
Loan. The Custodian shall not be responsible for verifying the validity,
sufficiency or genuineness of any document in any Custodial File.
Within 120 days after the related Delivery Date, the Custodian shall
ascertain that all documents required to be reviewed by it are in its
possession, and shall deliver to the Depositor, the Unaffiliated Seller, the
Servicer, the Trustee and the Securities Administrator a
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Final Certification to the effect that, as to each Mortgage Loan listed in the
Mortgage Loan Schedule (other than any Mortgage Loan paid in full or any
Mortgage Loan specifically identified in such certification as an exception and
not covered by such certification): (i) all documents required to be reviewed by
it are in its possession; (ii) such documents have been reviewed by it and
appear regular on their face and relate to such Mortgage Loan; (iii) based on
its examination and only as to the foregoing documents, the information set
forth in items (1), (2) and (18) of the Mortgage Loan Schedule and items (1),
(9) and (17) of the Data Tape Information respecting such Mortgage Loan is
correct; (iv) each Mortgage Note has been endorsed as provided in Section 2.01
of this Agreement; and (v) upon receipt of the screen printouts specified in
Section 2.01, with respect to each MERS Designated Loan, the Trustee, on behalf
of the Trust Fund, is listed as the Investor of such MERS Designated Loan on the
MERS System. The Custodian shall not be responsible to verify the validity,
sufficiency or genuineness of any document in any Custodial File. Upon receipt
of such Final Certification, if the Depositor or the Unaffiliated Seller
determines that any noncompliance identified by the Custodian is a breach of a
representation or warranty relating to such Mortgage Loan, such party shall give
written notice to the Trustee and the Securities Administrator thereof.
The Custodian shall retain possession and custody of each Custodial
File in accordance with and subject to the terms and conditions set forth
herein. The Servicer shall promptly deliver to the Custodian, upon the execution
or receipt thereof, the originals of such other documents or instruments
constituting the Custodial File as come into the possession of the Servicer from
time to time.
Section 2.03 Representations, Warranties and Covenants of the
Unaffiliated Seller and the Servicer.
(a) [Reserved]
(b) Saxon hereby makes the representations and warranties set forth in
(i) Schedule III hereto to the Depositor, the Unaffiliated Seller, the
Custodian, the Securities Administrator and the Trustee and (ii) Schedule IIIA
hereto to the Unaffiliated Seller, in each case, as of the Closing Date, and
with respect to Subsequent Mortgage Loans, as of the related Subsequent Transfer
Date; provided, however, that in the case of clause (ii), Saxon only makes
representations and warranties with respect to those Mortgage Loans on Schedule
IB hereto for which the Servicing Transfer Date has occurred prior to the
Closing Date or the related Subsequent Transfer Date, as applicable.
(c) IXIS Real Estate Capital Inc., in its capacity as the Unaffiliated
Seller, hereby makes the representations and warranties set forth in Schedule IV
hereto to the Depositor, the Trustee, the Securities Administrator and the
Custodian as of the Closing Date.
(d) It is understood and agreed by the Servicer and the Unaffiliated
Seller that the representations and warranties set forth in Section 2.03 shall
survive the transfer of the Mortgage Loans to the Trust Fund, and shall inure to
the benefit of the Trust Fund 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 any of the Depositor,
the Unaffiliated Seller, the Trustee, the Securities Administrator or the
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Servicer of a breach by the Unaffiliated Seller of any of the foregoing
representations or any of the representations and warranties made pursuant to
Sections 3.01(f), 3.01(h), 3.01(n), 3.01(o), 3.01(p) or 3.03 of the Unaffiliated
Seller's Agreement or by any Originator of the representations and warranties
made pursuant to the related Assignment and Recognition Agreement, the party
discovering such breach shall give prompt written notice to the others.
Within 90 days of the earlier of either discovery by or notice to the
Unaffiliated Seller of any breach of a representation or warranty set forth in
Section 3.01(f), 3.01(h), 3.01(n), 3.01(o), 3.01(p) or 3.03 of the Unaffiliated
Seller's Agreement that materially and adversely affects the value of the
Mortgage Loans or the interest of the Trustee or the Certificateholders therein,
the Unaffiliated Seller shall use its best efforts to cure such breach in all
material respects and, if such breach cannot be remedied, the Unaffiliated
Seller shall, (i) if such 90-day period expires prior to the second anniversary
of the related Delivery Date, remove such Mortgage Loan from the Trust Fund and
substitute in its place a Substitute Mortgage Loan, in the manner and subject to
the conditions set forth in this Section 2.03; or (ii) repurchase such Mortgage
Loan at the Repurchase Price; provided, however, that any such substitution
pursuant to (i) above shall not be effected prior to the delivery to the Trustee
of the Opinion of Counsel or Officer's Certificate, as applicable, as required
by Section 2.05 and a Request for Release substantially in the form of Exhibit
K, and the Mortgage File for any such Substitute Mortgage Loan. The Trustee
shall forward such Request for Release to the Custodian and the Custodian shall
release the related Mortgage File.
In the event there is a breach of a representation or warranty by
Accredited with respect to an Accredited Home Loan that materially and adversely
affects the value of such Mortgage Loan or the interest of the Trustee and the
Certificateholders therein, and, upon discovery or receipt of notice, Accredited
fails to cure, substitute or repurchase such Mortgage Loan within the period
specified in either the Accredited Assignment Agreement or the Accredited
Purchase Agreement, the Unaffiliated Seller shall cure, substitute or repurchase
such Mortgage Loan subject to the conditions set forth in this Section 2.03. In
the event there is a breach of a representation or warranty by CIT with respect
to a CIT Home Loan that materially and adversely affects the value of such
Mortgage Loan or the interest of the Trustee and the Certificateholders therein,
and, upon discovery or receipt of notice, CIT fails to cure, substitute or
repurchase such Mortgage Loan within the period specified in either the CIT
Assignment Agreement or the CIT Purchase Agreement, the Unaffiliated Seller
shall cure, substitute or repurchase such Mortgage Loan subject to the
conditions set forth in this Section 2.03. In the event there is a breach of a
representation or warranty by First Bank with respect to a First Bank Mortgage
Loan that materially and adversely affects the value of such Mortgage Loan or
the interest of the Trustee and the Certificateholders therein, and, upon
discovery or receipt of notice, First Bank fails to cure, substitute or
repurchase such Mortgage Loan within the period specified in either the First
Bank Assignment Agreement or the First Bank Purchase Agreement, the Unaffiliated
Seller shall cure, substitute or repurchase such Mortgage Loan subject to the
conditions set forth in this Section 2.03. In the event there is a breach of a
representation or warranty by First NLC with respect to a First NLC Mortgage
Loan that materially and adversely affects the value of such Mortgage Loan or
the interest of the Trustee and the Certificateholders therein, and, upon
discovery or receipt of notice, First NLC fails to cure, substitute or
repurchase such Mortgage Loan within the period specified in either the First
NLC Assignment Agreement or the First NLC Purchase Agreement, the Unaffiliated
Seller shall cure, substitute or repurchase
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such Mortgage Loan subject to the conditions set forth in this Section 2.03. In
the event there is a breach of a representation or warranty by FlexPoint with
respect to a FlexPoint Mortgage Loan that materially and adversely affects the
value of such Mortgage Loan or the interest of the Trustee and the
Certificateholders therein, and, upon discovery or receipt of notice, FlexPoint
fails to cure, substitute or repurchase such Mortgage Loan within the period
specified in either the FlexPoint Assignment Agreement or the FlexPoint Purchase
Agreement, the Unaffiliated Seller shall cure, substitute or repurchase such
Mortgage Loan subject to the conditions set forth in this Section 2.03. In the
event there is a breach of a representation or warranty by Funding America with
respect to a Funding America Mortgage Loan that materially and adversely affects
the value of such Mortgage Loan or the interest of the Trustee and the
Certificateholders therein, and, upon discovery or receipt of notice, Funding
America fails to cure, substitute or repurchase such Mortgage Loan within the
period specified in either the Funding America Assignment Agreement or the
Funding America Purchase Agreement, the Unaffiliated Seller shall cure,
substitute or repurchase such Mortgage Loan subject to the conditions set forth
in this Section 2.03. In the event there is a breach of a representation or
warranty by Lenders Direct with respect to a Lenders Direct Mortgage Loan that
materially and adversely affects the value of such Mortgage Loan or the interest
of the Trustee and the Certificateholders therein, and, upon discovery or
receipt of notice, Lenders Direct fails to cure, substitute or repurchase such
Mortgage Loan within the period specified in either the Lenders Direct
Assignment Agreement or the Lenders Direct Purchase Agreement, the Unaffiliated
Seller shall cure, substitute or repurchase such Mortgage Loan subject to the
conditions set forth in this Section 2.03. In the event there is a breach of a
representation or warranty by Lime Financial with respect to a Lime Financial
Mortgage Loan that materially and adversely affects the value of such Mortgage
Loan or the interest of the Trustee and the Certificateholders therein, and,
upon discovery or receipt of notice, Lime Financial fails to cure, substitute or
repurchase such Mortgage Loan within the period specified in either the Lime
Financial Assignment Agreement or the Lime Financial Purchase Agreement, the
Unaffiliated Seller shall cure, substitute or repurchase such Mortgage Loan
subject to the conditions set forth in this Section 2.03. In the event there is
a breach of a representation or warranty by Mandalay with respect to a Mandalay
Mortgage Loan that materially and adversely affects the value of such Mortgage
Loan or the interest of the Trustee and the Certificateholders therein, and,
upon discovery or receipt of notice, Mandalay fails to cure, substitute or
repurchase such Mortgage Loan within the period specified in either the Mandalay
Assignment Agreement or the Mandalay Purchase Agreement, the Unaffiliated Seller
shall cure, substitute or repurchase such Mortgage Loan subject to the
conditions set forth in this Section 2.03. In the event there is a breach of a
representation or warranty by Master Financial with respect to a Master
Financial Mortgage Loan that materially and adversely affects the value of such
Mortgage Loan or the interest of the Trustee and the Certificateholders therein,
and, upon discovery or receipt of notice, Master Financial fails to cure,
substitute or repurchase such Mortgage Loan within the period specified in
either the Master Financial Assignment Agreement or the Master Financial
Purchase Agreement, the Unaffiliated Seller shall cure, substitute or repurchase
such Mortgage Loan subject to the conditions set forth in this Section 2.03. In
the event there is a breach of a representation or warranty by Maxim with
respect to a Maxim Mortgage Loan that materially and adversely affects the value
of such Mortgage Loan or the interest of the Trustee and the Certificateholders
therein, and, upon discovery or receipt of notice, Maxim fails to cure,
substitute or repurchase such Mortgage Loan within the period specified in
either the Maxim Assignment Agreement or the Maxim Purchase Agreement, the
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Unaffiliated Seller shall cure, substitute or repurchase such Mortgage Loan
subject to the conditions set forth in this Section 2.03. In the event there is
a breach of a representation or warranty by Platinum with respect to a Platinum
Home Loan that materially and adversely affects the value of such Mortgage Loan
or the interest of the Trustee and the Certificateholders therein, and, upon
discovery or receipt of notice, Platinum fails to cure, substitute or repurchase
such Mortgage Loan within the period specified in either the Platinum Assignment
Agreement or the Platinum Purchase Agreement, the Unaffiliated Seller shall
cure, substitute or repurchase such Mortgage Loan subject to the conditions set
forth in this Section 2.03. In the event there is a breach of a representation
or warranty by Quick Loan with respect to a Quick Loan Mortgage Loan that
materially and adversely affects the value of such Mortgage Loan or the interest
of the Trustee and the Certificateholders therein, and, upon discovery or
receipt of notice, Quick Loan fails to cure, substitute or repurchase such
Mortgage Loan within the period specified in either the Quick Loan Assignment
Agreement or the Quick Loan Purchase Agreement, the Unaffiliated Seller shall
cure, substitute or repurchase such Mortgage Loan subject to the conditions set
forth in this Section 2.03. In the event there is a breach of a representation
or warranty by Rose with respect to a Rose Mortgage Loan that materially and
adversely affects the value of such Mortgage Loan or the interest of the Trustee
and the Certificateholders therein, and, upon discovery or receipt of notice,
Rose fails to cure, substitute or repurchase such Mortgage Loan within the
period specified in either the Rose Assignment Agreement or the Rose Purchase
Agreement, the Unaffiliated Seller shall cure, substitute or repurchase such
Mortgage Loan subject to the conditions set forth in this Section 2.03. In the
event there is a breach of a representation or warranty by Sebring with respect
to a Sebring Home Loan that materially and adversely affects the value of such
Mortgage Loan or the interest of the Trustee and the Certificateholders therein,
and, upon discovery or receipt of notice, Sebring fails to cure, substitute or
repurchase such Mortgage Loan within the period specified in the Sebring
Purchase Agreement, the Unaffiliated Seller shall cure, substitute or repurchase
such Mortgage Loan subject to the conditions set forth in this Section 2.03.
Notwithstanding the Unaffiliated Seller's lack of knowledge, in the event it is
discovered by the Unaffiliated Seller, the Depositor or the Trust (including the
Trustee and the Servicer acting on the Trust's behalf), that the substance of a
representation or warranty was inaccurate as of the applicable date of such
representation or warranty and such inaccuracy materially and adversely affects
the value of the related Mortgage Loan, the Unaffiliated Seller shall use its
best efforts to cure such breach or substitute or repurchase such Mortgage Loan
in accordance with this Section 2.03(d).
With respect to any Substitute Mortgage Loan or Loans, the
Unaffiliated Seller shall deliver to the Custodian, on behalf of the Trustee,
for the benefit of the Certificateholders the Mortgage Note, the Mortgage, the
related Assignment of the Mortgage, and such other documents and agreements as
are required by Section 2.01, with the Mortgage Note endorsed and the Mortgage
assigned as required by Section 2.01. No substitution is permitted to be made in
any calendar month after the Determination Date for such month. Scheduled
Payments due with respect to Substitute Mortgage Loans in the Due Period of
substitution shall not be part of the Trust Fund and will be retained by the
related Originator on the next succeeding Distribution Date. For the Due Period
of substitution, distributions to Certificateholders will include the Scheduled
Payment due on any Deleted Mortgage Loan for such Due Period and thereafter the
related Originator shall be entitled to retain all amounts received in respect
of such Deleted Mortgage Loan.
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For any month in which the Unaffiliated Seller substitutes one or more
Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the Servicer
will determine the amount (if any) by which the aggregate principal balance of
all such Substitute Mortgage Loans as of the date of substitution is less than
the aggregate unpaid principal balance of all such Deleted Mortgage Loans. The
Unaffiliated Seller shall deposit the amount of such shortage plus an amount
equal to the aggregate of any unreimbursed Advances and accrued and unpaid
Servicing Fee with respect to such Deleted Mortgage Loans (the "Substitution
Adjustment Amount") into the Collection Account on or before the Remittance Date
for the Distribution Date in the month succeeding the calendar month during
which the related Mortgage Loan became required to be purchased or replaced
hereunder.
Upon receipt of written notice (x) from the Custodian that any
document does not comply with the requirements set forth in clauses (i) through
(iv) of the Custodian's review of the Custodial Files pursuant to Section 2.02
or (y) of a breach of a representation and warranty, the Trustee shall in turn
promptly notify the applicable Originator (with a copy to the Servicer, the
Custodian and the Unaffiliated Seller) in writing of such non-compliance or
breach and request that the related Originator cure such non-compliance or
breach within the time period set forth in the applicable Mortgage Loan Purchase
Agreement (but in any event, within 60 days from the date the related Originator
is notified of such non-compliance or breach) and if the related Originator does
not cure such non-compliance or breach in all material respects during such
period, the Securities Administrator shall notify such Originator to repurchase
such Mortgage Loan from the Trust Fund at the Repurchase Price. In the event the
Trustee receives written notice (x) of a breach by any Originator of a
representation and warranty that is subject to an automatic sixty-day repurchase
obligation pursuant to Section 9.03 of the related Mortgage Loan Purchase
Agreement, which representations and warranties relate to Prepayment Fees,
Predatory Lending Regulations, Single Premium Credit Insurance, the Georgia Fair
Lending Act, the Fair Credit Reporting Act, New York State Banking Law or (y)
that a Mortgage Loan does not constitute a "qualified mortgage" within the
meaning of Section 860G(a)(3) of the Code, the Trustee shall notify such
Originator to repurchase the Mortgage Loan at the Repurchase Price within sixty
(60) days of such Originator's receipt of such notice.
(e) Upon receipt of the Final Certification with respect to each
Mortgage Loan, the Trustee will notify the related Originator within 5 Business
Days of such delivery of any missing documents from the Custodial File and if
the related Originator does not deliver such missing documents within 60 days
from the date the related Originator is notified of such noncompliance or
breach, the Trustee shall notify such Originator to repurchase such Mortgage
Loan from the Trust Fund at the Repurchase Price.
(f) Based solely on information received with respect to any
Substitute Mortgage Loan from the Unaffiliated Seller or the related Originator,
as applicable, the Servicer shall amend the Mortgage Loan Schedule to reflect
the removal of such Deleted Mortgage Loan and the substitution of the Substitute
Mortgage Loan or Loans and the Servicer shall deliver the amended Mortgage Loan
Schedule to the Securities Administrator. Upon such substitution, the Substitute
Mortgage Loan or Loans shall be subject to the terms of this Agreement in all
respects, and the Unaffiliated Seller shall be deemed to have made with respect
to such Substitute Mortgage Loan or Loans, as of the date of substitution, the
representations and warranties made pursuant to Sections 3.01(f), 3.01(h),
3.01(n), 3.01(o), 3.01(p) and 3.03 of the
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Unaffiliated Seller's Agreement with respect to such Mortgage Loan. Upon any
such substitution and the deposit to the Collection Account of the amount
required to be deposited therein in connection with such substitution as
described in this Section 2.03, the Securities Administrator shall forward the
Request for Release from the Servicer to the Custodian and the Custodian shall
release the Mortgage File relating to such Deleted Mortgage Loan to the
Unaffiliated Seller or the related Originator, as applicable, and shall execute
and deliver at the Unaffiliated Seller's or related Originator's direction, as
applicable, such instruments of transfer or assignment prepared by such party,
in each case without recourse, as shall be necessary to vest title in the
Unaffiliated Seller or the related Originator, or its designee, as applicable,
the Trustee's interest in any Deleted Mortgage Loan substituted for pursuant to
this Section 2.03.
(g) In the event that the Unaffiliated Seller or the related
Originator, as applicable, shall have repurchased a Mortgage Loan, the
Repurchase Price therefor shall be deposited in the Collection Account pursuant
to Section 3.10 on or before the Remittance Date for the Distribution Date in
the month following the month during which the Unaffiliated Seller or the
related Originator, as applicable, became obligated hereunder to repurchase or
replace such Mortgage Loan and upon such deposit of the Repurchase Price, the
delivery of the Opinion of Counsel or Officer's Certificate, as applicable,
required by Section 2.05 and receipt of a Request for Release in the form of
Exhibit K hereto, the Trustee shall forward the Request for Release from the
Servicer to the Custodian, and the Custodian shall release the related Custodial
File to such Person as directed by the Servicer, and the Trustee shall execute
and deliver at such Person's direction such instruments of transfer or
assignment prepared by such Person, in each case without recourse, as shall be
necessary to transfer title from the Trustee. It is understood and agreed that
the obligation under this Agreement of any Person to cure, repurchase or replace
any Mortgage Loan as to which a breach has occurred and is continuing shall
constitute the sole remedy against such Persons respecting such breach available
to Certificateholders, the Depositor, the Unaffiliated Seller, the Custodian,
the Securities Administrator or the Trustee on their behalf. In the event such
required repurchase or replacement does not occur, the Securities Administrator
shall take such actions as directed upon written direction from the Depositor
and the provision of reasonable indemnity satisfactory to the Securities
Administrator in accordance with Sections 6.03 and 10.02.
(h) If the Unaffiliated Seller is required to repurchase or replace a
Mortgage Loan pursuant to the terms hereof, upon receipt by the Trustee of
written direction from the Unaffiliated Seller and either written certification
from the Unaffiliated Seller that it has deposited the related Repurchase Price
with the Securities Administrator or receipt by the Trustee of a Substitute
Mortgage Loan, as applicable, the Trustee shall assign to the Unaffiliated
Seller its rights under the related Mortgage Loan Purchase Agreement solely with
respect to such Mortgage Loan by an assignment in form and substance mutually
satisfactory to the Unaffiliated Seller, the Trustee and the Securities
Administrator.
(i) The representations and warranties made pursuant to this Section
2.03 shall survive delivery of the respective Custodial Files to the Custodian.
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Section 2.04 The Depositor and the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee and the
Securities Administrator with respect to each Mortgage Loan as of the date
hereof or such other date set forth herein that as of the related Delivery Date,
and following the transfer of the Mortgage Loans to it by the Unaffiliated
Seller, the Depositor had good title to the Mortgage Loans and the Mortgage
Notes were subject to no offsets, defenses or counterclaims.
The Depositor hereby assigns, transfers and conveys to the Trustee all
of its rights with respect to the Initial Mortgage Loans and shall, on each
Subsequent Transfer Date, convey all of its right, title and interest with
respect to the related subsequent Mortgage Loans.
Section 2.05 Delivery of Opinion of Counsel or Officer's Certificate
in Connection with Substitutions and Non-Qualified Mortgages.
Notwithstanding any contrary provision of this Agreement, no
substitution pursuant to Section 2.03 shall be made more than 30 days after the
related Delivery Date unless the Unaffiliated Seller delivers, or causes the
related Originator to deliver, as applicable, to the Securities Administrator
and the Trustee (i) with respect to any substitution occurring in the first 23
months following the Startup Day, an Officer's Certificate stating that the
Deleted Mortgage Loan was in violation of a representation or warranty that was
made with respect to such loan as of the Closing Date or related Subsequent
Transfer Date, as applicable (ii) with respect to any substitution occurring in
the 24th month following the Startup Day and thereafter, an Opinion of Counsel,
at the expense of the Unaffiliated Seller or the related Originator, as
applicable, addressed to the Trustee and the Securities Administrator, to the
effect that such substitution will not (i) result in the imposition of the tax
on "prohibited transactions" on the Trust Fund or contributions after the
Startup Day, as defined in Sections 860F(a)(2) and 860G(d) of the Code,
respectively, or (ii) cause any REMIC created hereunder to fail to qualify as
one or more REMICs at any time that any Certificates are outstanding.
Section 2.06 Execution and Delivery of Certificates.
The Trustee acknowledges the transfer and assignment to it of the
Trust Fund and, concurrently with such transfer and assignment, the Securities
Administrator has executed and delivered to or upon the order of the Depositor,
the Certificates in authorized denominations evidencing directly or indirectly
the entire ownership of the Trust Fund. The Trustee agrees to hold the Trust
Fund and exercise the rights referred to above for the benefit of all present
and future Holders of the Certificates.
Section 2.07 REMIC Matters.
The Preliminary Statement sets forth the designations for federal
income tax purposes of all interests created hereby. The "Startup Day" for
purposes of the REMIC Provisions shall be the Closing Date. Unless otherwise
stated, the "latest possible maturity date" is May 25, 2038, which is the
Distribution Date in the thirteenth month following the month in which the
latest maturity date of any Mortgage Loan occurs.
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Section 2.08 Representations and Warranties of the Depositor.
The Depositor hereby represents, warrants and covenants to the
Trustee, the Custodian, the Securities Administrator, the Master Servicer, the
Unaffiliated Seller and the Servicer that as of the date of this Agreement or as
of such date specifically provided herein:
(a) The Depositor is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware;
(b) The Depositor has the corporate power and authority to convey the
Mortgage Loans and to execute, deliver and perform, and to enter into and
consummate the transactions contemplated by, this Agreement;
(c) This Agreement has been duly and validly authorized, executed and
delivered by the Depositor, all requisite corporate action having been taken,
and, assuming the due authorization, execution and delivery hereof by the other
parties hereto, constitutes or will constitute the legal, valid and binding
agreement of the Depositor, enforceable against the Depositor in accordance with
its terms, except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
rights of creditors generally, and by general equity principles (regardless of
whether such enforcement is considered in a proceeding in equity or at law);
(d) No consent, approval, authorization or order of or registration or
filing with, or notice to, any governmental authority or court is required for
the execution, delivery and performance of or compliance by the Depositor with
this Agreement or the consummation by the Depositor of any of the transactions
contemplated hereby, except as have been made on or prior to the Closing Date;
(e) None of the execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby or thereby, or the
fulfillment of or compliance with the terms and conditions of this Agreement,
(i) conflicts or will conflict with or results or will result in a breach of, or
constitutes or will constitute a default or results or will result in an
acceleration under (A) the charter or by-laws of the Depositor, or (B) of any
term, condition or provision of any material indenture, deed of trust, contract
or other agreement or instrument to which the Depositor or any of its
subsidiaries is a party or by which it or any of its subsidiaries is bound; (ii)
results or will result in a violation of any law, rule, regulation, order,
judgment or decree applicable to the Depositor of any court or governmental
authority having jurisdiction over the Depositor or its subsidiaries; or (iii)
results in the creation or imposition of any lien, charge or encumbrance which
would have a material adverse effect upon the Mortgage Loans or any documents or
instruments evidencing or securing the Mortgage Loans;
(f) There are no actions, suits or proceedings before or against or
investigations of, the Depositor pending, or to the knowledge of the Depositor,
threatened, before any court, administrative agency or other tribunal, and no
notice of any such action, which, in the Depositor's reasonable judgment, might
materially and adversely affect the performance by the Depositor of its
obligations under this Agreement, or the validity or enforceability of this
Agreement;
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(g) The Depositor is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal, state,
municipal or governmental agency that may materially and adversely affect its
performance hereunder; and
(h) Immediately prior to the transfer and assignment by the Depositor
to the Trustee, the Depositor had, or, with respect to the Subsequent Mortgage
Loans, will have, good title to, and was, or will be, the sole owner of each
Mortgage Loan, free of any interest of any other Person, and the Depositor has
transferred, or shall transfer, all right, title and interest in each Mortgage
Loan to the Trustee. The transfer of the Mortgage Note and the Mortgage to the
Custodian, on behalf of the Trustee, as and in the manner contemplated by this
Agreement is sufficient either (i) fully to transfer to the Trustee, for the
benefit of the Certificateholders, all right, title, and interest of the
Depositor thereto as note holder and mortgagee or (ii) to grant to the Trustee,
for the benefit of the Certificateholders and the security interest referred to
in Section 10.04.
(i) The Depositor has caused any payment to the Swap Provider or the
Cap Provider due and payable on or prior to the Closing Date to have been fully
paid on or prior to the Closing Date.
It is understood and agreed that the representations, warranties and
covenants set forth in this Section 2.08 shall survive delivery of the
respective Custodial Files to the Custodian and shall inure to the benefit of
the Trustee.
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Servicer to Service Mortgage Loans.
(a) For and on behalf of the Certificateholders, the Servicer shall
service and administer the Mortgage Loans for which it is acting as Servicer in
accordance with the terms of this Agreement and the respective Mortgage Loans
and, to the extent consistent with such terms, in the same manner in which it
services and administers similar mortgage loans for its own portfolio, giving
due consideration to customary and usual standards of practice of prudent
mortgage lenders and loan servicers administering similar mortgage loans but
without regard to:
(i) any relationship that the Servicer, any Subservicer or any
Affiliate of the Servicer or any Subservicer may have with the related
Mortgagor;
(ii) the ownership or non-ownership of any Certificate by the
Servicer or any Affiliate of the Servicer;
(iii) the Servicer's obligation to make P&I Advances or Servicing
Advances; or
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(iv) the Servicer's or any Subservicer's right to receive
compensation for its services hereunder or with respect to any particular
transaction.
To the extent consistent with the foregoing, the Servicer shall seek
to maximize the timely and complete recovery of principal and interest on the
Mortgage Notes. Subject only to the above-described servicing standards and the
terms of this Agreement and of the respective Mortgage Loans, the Servicer shall
have full power and authority, acting alone or through Subservicers as provided
in Section 3.02, to do or cause to be done any and all things in connection with
such servicing and administration which it may deem necessary or desirable.
Without limiting the generality of the foregoing, the Servicer, in its own name
or in the name of a Subservicer, is hereby authorized and empowered by the
Trustee when the Servicer believes it appropriate in its best judgment in
accordance with the servicing standards set forth above, to execute and deliver
any and all instruments of satisfaction or cancellation, or of partial or full
release or discharge, and all other comparable instruments, with respect to the
Mortgage Loans and the Mortgaged Properties and to institute foreclosure
proceedings or obtain a deed-in-lieu of foreclosure so as to convert the
ownership of such properties, and to hold or cause to be held title to such
properties, on behalf of the Trustee. The Servicer shall service and administer
the Mortgage Loans in accordance with applicable state and federal law and shall
provide to the Mortgagors any reports required to be provided to them thereby.
The Servicer covenants that its computer and other systems used in servicing the
Mortgage Loans operate in a manner such that the Servicer can service the
Mortgage Loans in accordance with the terms of this Agreement. The Servicer
shall also comply in the performance of this Agreement with all reasonable rules
and requirements of each insurer under any standard hazard insurance policy.
Subject to Section 3.15, the Trustee shall execute, at the written request of
the Servicer, and furnish, or cause to be furnished, to the Servicer and any
Subservicer such documents as are necessary or appropriate to enable the
Servicer or any Subservicer to carry out their servicing and administrative
duties hereunder, and the Trustee hereby grants to the Servicer, and this
Agreement shall constitute, a power of attorney to carry out such duties
including a power of attorney to take title to Mortgaged Properties after
foreclosure on behalf of the Trustee. The Trustee shall execute a separate power
of attorney in favor of the Servicer for the purposes described herein to the
extent necessary or desirable to enable the Servicer to perform its duties
hereunder. The Trustee shall not be liable for the actions of the Servicer or
any Subservicers under such powers of attorney.
(b) Subject to Section 3.09(b), in accordance with the standards of
the preceding paragraph, the Servicer shall advance or cause to be advanced
funds as necessary for the purpose of effecting the timely payment of taxes and
assessments on the Mortgaged Properties, which advances shall be Servicing
Advances reimbursable in the first instance from related collections from the
Mortgagors pursuant to Section 3.09(b), and further as provided in Section 3.11.
Any cost incurred by the Servicer or by Subservicers in effecting the timely
payment of taxes and assessments on a Mortgaged Property shall not be added to
the unpaid principal balance of the related Mortgage Loan, notwithstanding that
the terms of such Mortgage Loan so permit.
(c) Notwithstanding anything in this Agreement to the contrary, the
Servicer may not make any future advances with respect to a Mortgage Loan
(except as provided in Section 4.01) and the Servicer shall not (i) permit any
modification with respect to any Mortgage Loan (except in the case of a
defaulted Mortgage Loan) that would change the Mortgage Rate,
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reduce or increase the principal balance (except for reductions resulting from
actual payments of principal) or change the final maturity date on such Mortgage
Loan (except for a reduction of interest payments resulting from the application
of the Servicemembers Civil Relief Act or any similar state statutes) or (ii)
permit any modification, waiver or amendment of any term of any Mortgage Loan
that would both (A) effect an exchange or reissuance of such Mortgage Loan under
Section 1001 of the Code (or final, temporary or proposed Department of the
Treasury regulations promulgated thereunder) and (B) cause any REMIC created
hereunder to fail to qualify as a REMIC under the Code or the imposition of any
tax on "prohibited transactions" or "contributions after the startup day" under
the REMIC Provisions, or (iii) except as provided in Section 3.07(a), waive any
Prepayment Charges.
(d) The Servicer may delegate its responsibilities under this
Agreement; provided, however, that no such delegation shall release the Servicer
from the responsibilities or liabilities arising under this Agreement.
(e) In the event that the Mortgage Loan Documents relating to any
Mortgage Loan contain provisions requiring the related Mortgagor to submit to
binding arbitration of any disputes arising in connection with such Mortgage
Loan, the Servicer shall be entitled at its sole discretion to waive any such
provisions on behalf of the Trust and to send written notice of such waiver to
the related Mortgagor, although the Mortgagor may still require arbitration of
such disputes at its option.
(f) [Reserved]
(g) [Reserved]
Section 3.02 Subservicing Agreements Between the Servicer and
Subservicers.
(a) The Servicer may enter into subservicing agreements with
Subservicers for the servicing and administration of the Mortgage Loans
("Subservicing Agreements"). The Servicer represents and warrants to the other
parties hereto that, except as otherwise set forth herein, no Subservicing
Agreement is in effect as of the Closing Date. The Servicer shall give notice to
the Depositor, the Securities Administrator, the Master Servicer and the Trustee
of any such Subservicer and Subservicing Agreement, which notice shall contain
all information (including without limitation a copy of the Subservicing
Agreement) reasonably necessary to enable the Securities Administrator, pursuant
to Section 8.12(g), to accurately and timely report the event under Item 6.02 of
Form 8-K pursuant to the Exchange Act (if such reports under the Exchange Act
are required to be filed under the Exchange Act). No Subservicing Agreement
shall be effective until 30 days after such written notice is received by both
the Depositor, the Securities Administrator, the Master Servicer and the
Trustee. The Securities Administrator, Master Servicer, the Back-up Servicer and
the Trustee shall not be required to review or consent to such Subservicing
Agreements and shall have no liability in connection therewith.
Each Subservicer shall be (i) authorized to transact business in the
state or states in which the related Mortgaged Properties it is to service are
situated, if and to the extent required by applicable law to enable the
Subservicer to perform its obligations hereunder and under the Subservicing
Agreement, (ii) an institution approved as a mortgage loan originator by
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the Federal Housing Administration or an institution that has deposit accounts
insured by the FDIC and (iii) a Xxxxxxx Mac or Xxxxxx Mae approved mortgage
servicer. Each Subservicing Agreement must impose on the Subservicer
requirements conforming to the provisions set forth in Section 3.08 and provide
for servicing of the Mortgage Loans consistent with the terms of this Agreement.
The Servicer will examine each Subservicing Agreement to which it is a party and
will be familiar with the terms thereof. The terms of any Subservicing Agreement
will not be inconsistent with any of the provisions of this Agreement. The
Servicer and the Subservicers may enter into and make amendments to the
Subservicing Agreements or enter into different forms of Subservicing
Agreements; provided, however, that any such amendments or different forms shall
be consistent with and not violate the provisions of this Agreement, and that no
such amendment or different form shall be made or entered into which could be
reasonably expected to be materially adverse to the interests of the Trustee.
Any variation from the provisions set forth in Section 3.08 relating to
insurance or priority requirements of Subservicing Accounts, or credits and
charges to the Subservicing Accounts or the timing and amount of remittances by
the Subservicers to the Servicer, are conclusively deemed to be inconsistent
with this Agreement and therefore prohibited. The Servicer shall deliver to the
Securities Administrator, the Trustee, the Master Servicer, the Unaffiliated
Seller and the Depositor copies of all Subservicing Agreements, and any
amendments or modifications thereof, promptly upon the Servicer's execution and
delivery of such instruments.
(b) As part of its servicing activities hereunder, the Servicer
(except as otherwise provided in the last sentence of this paragraph), for the
benefit of the Trustee, shall enforce the obligations of each Subservicer under
the related Subservicing Agreement, including, without limitation, any
obligation to make advances in respect of delinquent payments as required by a
Subservicing Agreement. Such enforcement, including, without limitation, the
legal prosecution of claims, termination of Subservicing Agreements, and the
pursuit of other appropriate remedies, shall be in such form and carried out to
such an extent and at such time as the Servicer, in its good faith business
judgment, would require were it the owner of the related Mortgage Loans. The
Servicer shall pay the costs of such enforcement at its own expense, and shall
be reimbursed therefor only (i) from a general recovery resulting from such
enforcement, to the extent, if any, that such recovery exceeds all amounts due
in respect of the related Mortgage Loans or (ii) from a specific recovery of
costs, expenses or attorneys' fees against the party against whom such
enforcement is directed.
(c) The Servicer shall cause any Subservicer engaged by the Servicer
(or by any Subservicer) for the benefit of the Depositor, the Securities
Administrator, the Master Servicer and the Trustee to comply with the provisions
of this Section 3.02 and with Sections 3.22, 3.23, 6.02 and 6.05 of this
Agreement to the same extent as if such Subservicer were the Servicer, and to
provide the information required with respect to such Subservicer under Section
8.12 of this Agreement. The Servicer shall be responsible for obtaining from
each such Subservicer and delivering to applicable Persons the Servicer
compliance statement required to be delivered by such Subservicer under Section
3.22 and any assessment of compliance report and related accountant's
attestation required to be delivered by such Subservicer under Section 3.23, in
each case as and when required to be delivered.
(d) Subject to the conditions set forth in this Section 3.02(d), the
Servicer and any Subservicer engaged by the Servicer is permitted to utilize one
or more Subcontractors to
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perform certain of its obligations hereunder. The Servicer shall promptly upon
request provide to the Depositor a written description (in form and substance
satisfactory to the Depositor) of the role and function of each Subcontractor
utilized by the Servicer or any such Subservicer, specifying, not later than the
date specified for delivery of the annual report on assessment of compliance set
forth in Section 3.23(b) (i) the identity of each such Subcontractor, if any,
that is materially "participating in the servicing function" (with respect to
more than 5% of the pool assets) within the meaning of Item 1122 of Regulation
AB, and (ii) which elements of the Servicing Criteria will be addressed in
assessments of compliance provided by each Subcontractor identified pursuant to
clause (i) of this paragraph. As a condition to the utilization by the Servicer
or any such Subservicer of any Subcontractor determined to be materially
"participating in the servicing function" (with respect to more than 5% of the
pool assets)within the meaning of Item 1122 of Regulation AB, the Servicer shall
cause any such Subcontractor used by the Servicer (or by any such Subservicer)
for the benefit of the Depositor, the Securities Administrator, the Master
Servicer and the Trustee to comply with the provisions of Section 3.23 of this
Agreement to the same extent as if such Subcontractor were the Servicer. The
Servicer shall be responsible for obtaining from each such Subcontractor and
delivering to the applicable Persons any assessment of compliance report and
related accountant's attestation required to be delivered by such Subcontractor
under Section 3.23, in each case as and when required to be delivered.
(e) Notwithstanding the foregoing, if the Servicer engages a
Subcontractor in connection with the performance of any of its duties under this
Agreement, the Servicer shall be responsible for determining whether such
Subcontractor is a "servicer" within the meaning of Item 1101 of Regulation AB
and whether any such affiliate or third-party vendor meets the criteria in Item
1108(a)(2)(i) through (iii) of Regulation AB. If the Servicer determines,
pursuant to the preceding sentence, that such Subcontractor is a "servicer"
within the meaning of Item 1101 of Regulation AB and meets the criteria in Item
1108(a)(2)(i) through (iii) of Regulation AB, then such Subcontractor shall be
deemed to be a Subservicer for purposes of this Agreement, the engagement of
such Subservicer shall not be effective unless and until notice is given
pursuant to Section 3.02(a) and the Servicer shall comply with Section 3.02(c)
with respect thereto.
Section 3.03 Successor Subservicers.
The Servicer shall be entitled to terminate any Subservicing Agreement
to which it is a party and the rights and obligations of any Subservicer
pursuant to any Subservicing Agreement in accordance with the terms and
conditions of such Subservicing Agreement provided, however, that the
termination, resignation or removal of a Subservicer shall be not be effective
until 30 days after written notice is received by the Depositor and the
Securities Administrator that contains all information reasonably necessary to
enable the Securities Administrator, pursuant to Section 8.12(g), to accurately
and timely report the event under Item 6.02 of Form 8-K pursuant to the Exchange
Act (if such reports under the Exchange Act are required to be filed under the
Exchange Act). In the event of termination of any Subservicer, all servicing
obligations of such Subservicer shall be assumed simultaneously by the Servicer
without any act or deed on the part of such Subservicer or the Servicer, and the
Servicer either shall service directly the related Mortgage Loans or shall enter
into a Subservicing Agreement with a successor Subservicer which qualifies under
Section 3.02.
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Any Subservicing Agreement shall include the provision that such
agreement may be immediately terminated by the Depositor, the Master Servicer or
the Securities Administrator without fee, in accordance with the terms of this
Agreement, in the event that the Servicer shall, for any reason, no longer be
the Servicer (including termination due to an Event of Default).
Section 3.04 Liability of the Servicer.
Notwithstanding any Subservicing Agreement, any of the provisions of
this Agreement relating to agreements or arrangements between the Servicer and a
Subservicer or reference to actions taken through a Subservicer or otherwise,
the Servicer shall remain obligated and primarily liable to the Trustee for the
servicing and administering of the Mortgage Loans in accordance with the
provisions of Section 3.01 without diminution of such obligation or liability by
virtue of such Subservicing Agreements or arrangements or by virtue of
indemnification from the Subservicer and to the same extent and under the same
terms and conditions as if the Servicer alone were servicing and administering
the Mortgage Loans. The Servicer shall be entitled to enter into any agreement
with a Subservicer for indemnification of the Servicer by such Subservicer and
nothing contained in this Agreement shall be deemed to limit or modify such
indemnification.
Section 3.05 No Contractual Relationship Between Subservicers and the
Trustee.
Any Subservicing Agreement that may be entered into and any
transactions or services relating to the Mortgage Loans involving a Subservicer
in its capacity as such shall be deemed to be between the Subservicer and the
Servicer alone, and neither the Trustee nor the Securities Administrator (or any
successor Servicer) shall not be deemed a party thereto and shall have no
claims, rights, obligations, duties or liabilities with respect to the
Subservicer except as set forth in Section 3.06. The Servicer shall be solely
liable for all fees owed by it to any Subservicer, irrespective of whether the
Servicer's compensation pursuant to this Agreement is sufficient to pay such
fees.
Section 3.06 Assumption or Termination of Subservicing Agreements by
Master Servicer.
In the event that Saxon at any time shall for any reason no longer be
the Servicer (including by reason of the occurrence of an Event of Default), the
Master Servicer or its designee shall thereupon assume all of the rights and
obligations of the Servicer under each Subservicing Agreement that the Servicer
may have entered into, with copies thereof provided to the Master Servicer,
prior to the Master Servicer assuming such rights and obligations, unless the
Master Servicer elects to terminate any Subservicing Agreement in accordance
with its terms as provided in Section 3.03.
Upon such assumption, the Master Servicer, its designee or the
successor Servicer shall be deemed, subject to Section 3.03, to have assumed all
of the Servicer's interest therein and to have replaced the Servicer as a party
to each Subservicing Agreement to which the predecessor Servicer was a party to
the same extent as if each Subservicing Agreement had been assigned to the
assuming party, except that (i) the Servicer shall not thereby be relieved of
any
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liability or obligations under any Subservicing Agreement that arose before it
ceased to be the Servicer and (ii) none of the Depositor, the Trustee, the
Master Servicer, their designees or any successor Servicer shall be deemed to
have assumed any liability or obligation of the Servicer (including, but without
limitation, any and all Advances made by the predecessor Servicer) that arose
before such predecessor Servicer ceased to be the Servicer.
The Servicer at its expense shall, upon request of the Master
Servicer, deliver to the assuming party all documents and records relating to
the Subservicing Agreement to which it is a party and the Mortgage Loans then
being serviced by it and an accounting of amounts collected and held by or on
behalf of it, and otherwise use its best efforts to effect the orderly and
efficient transfer of the Subservicing Agreements to the assuming party.
Section 3.07 Collection of Certain Mortgage Loan Payments;
Establishment of Certain Accounts.
(a) Subject to Section 3.07(o), the Servicer shall make reasonable
efforts to collect all payments called for under the terms and provisions of the
Mortgage Loans, and shall, to the extent such procedures shall be consistent
with this Agreement and the terms and provisions of any applicable Insurance
Policies, follow such collection procedures as it would follow with respect to
mortgage loans comparable to the Mortgage Loans and held for its own account.
Consistent with the foregoing and Accepted Servicing Practices, in the event
that any Mortgage Loan is in default or, in the judgment of the Servicer, such
default is reasonably foreseeable, the Servicer may waive, modify or vary any
term of such Mortgage Loan (including, but not limited to, modifications that
change the Mortgage Rate, forgive the payment of principal or interest or extend
the final maturity date of such Mortgage Loan), accept payment from the related
Mortgagor of an amount less than the Stated Principal Balance in final
satisfaction of such Mortgage Loan or consent to the postponement of strict
compliance with any such term or otherwise grant indulgence to any Mortgagor
(any and all such waivers, modifications, variances, forgiveness of principal or
interest, postponements, or indulgences collectively referred to herein as
"forbearance"). The Servicer's analysis supporting any forbearance and the
conclusion that any forbearance meets the Accepted Servicing Practices shall be
reflected in writing in the Mortgage File. In the event of any such arrangement
pursuant to clause (ii) above, the Servicer shall make timely advances on such
Mortgage Loan during such extension pursuant to Section 4.01 and in accordance
with the amortization schedule of such Mortgage Loan without modification
thereof by reason of such arrangements, subject to Section 4.01(d) pursuant to
which the Servicer shall not be required to make any such advances that are
Nonrecoverable P&I Advances. Notwithstanding the foregoing, the Servicer may not
waive, in whole or in part, a Prepayment Charge, except under the following
circumstances: (i) such waiver relates to a default or a reasonably foreseeable
default and would, in the reasonable judgment of the Servicer, maximize recovery
of total proceeds taking into account the value of such Prepayment Charge and
the related Mortgage Loan, and doing so is standard and customary in servicing
mortgage loans similar to the Mortgage Loans (including any waiver of a
Prepayment Charge in connection with a refinancing of a Mortgage Loan that is
related to a default or a reasonably foreseeable default), and in no event will
the Servicer waive a Prepayment Charge in connection with a refinancing of a
Mortgage Loan that is not related to a default or a reasonably foreseeable
default, or (ii) such Prepayment Charge is not permitted to be collected by
applicable law. If a Prepayment Charge is waived other than as permitted by the
prior sentence, then the Servicer is
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required to pay the amount of such waived Prepayment Charge, for the benefit of
the Holders of the Class P Certificates, by depositing such amount into the
Collection Account together with and at the time that the amount prepaid on the
related Mortgage Loan is required to be deposited into the Collection Account.
Notwithstanding any provision in this Agreement to the contrary, in the event
the Prepayment Charge payable under the terms of the Mortgage Note is less than
the amount of the Prepayment Charge set forth in the Mortgage Loan Schedule or
other information provided to the Servicer, the Servicer shall not have any
liability or obligation with respect to such difference, and in addition shall
not have any liability or obligation to pay the amount of any uncollected
Prepayment Charge if the failure to collect such amount is the direct result of
inaccurate or incomplete information on the Mortgage Loan Schedule.
(b) (i) The Securities Administrator shall establish and maintain the
Excess Reserve Fund Account, on behalf of the Class X Certificateholders to
receive any Basis Risk Payment and any Interest Rate Cap Payment and to secure
their limited recourse obligation to pay to the LIBOR Certificateholders Basis
Risk Carry Forward Amounts.
(ii) On each Distribution Date, the Securities Administrator
shall deposit the amount of any Basis Risk Payment made for the benefit of the
Certificateholders made for the benefit of the LIBOR Certificates for such date
into the Excess Reserve Fund Account.
(c) (i) On each Distribution Date on which there exists a Basis Risk
Carry Forward Amount on any Class of Certificates, the Securities Administrator
shall (1) withdraw from the Distribution Account and deposit in the Excess
Reserve Fund Account, as set forth in Section 4.02(a)(iii)(U), the lesser of (a)
the Class X Distributable Amount (without regard to the reduction in the
definition thereof with respect to the Basis Risk Payment) (to the extent
remaining after the distributions specified in Sections 4.02(a)(iii)(A)-(T), and
(b) the Basis Risk Payment and (2) withdraw from the Excess Reserve Fund Account
amounts necessary to pay to such Class or Classes of Certificates the Basis Risk
Carry Forward Amount. Such payments shall be allocated to those Classes on a pro
rata basis based upon the amount of Basis Risk Carry Forward Amount owed to each
such Class and shall be paid in the priority set forth in Section
4.02(a)(iii)(W).
(ii) The Securities Administrator shall account for each of the
Supplemental Interest Trust, the Excess Reserve Fund Account and the Swap
Account as an outside reserve fund within the meaning of Treasury regulations
section 1.860G-2(h) and not as an asset of any REMIC created pursuant to this
Agreement. The beneficial owners of the Supplemental Interest Trust, the Excess
Reserve Fund Account and the Swap Account are the Class X Certificateholders.
For all federal tax purposes, amounts transferred by REMIC V to the Excess
Reserve Fund Account shall be treated as distributions by the Securities
Administrator to the Class X Certificateholders. For all federal tax purposes,
amounts transferred by REMIC V to the Swap Account shall be treated as
distributions by the Securities Administrator on the Class I Interests.
(iii) Any Basis Risk Carry Forward Amounts paid by the Securities
Administrator to the LIBOR Certificateholders shall be accounted for by the
Securities
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Administrator as amounts paid first to the Holders of the Class X Certificates
and then to the respective Class or Classes of LIBOR Certificates.
(iv) Notwithstanding any provision contained in this Agreement,
the Securities Administrator shall not be required to make any payments from the
Excess Reserve Fund Account except as expressly set forth in this Section
3.07(c) and Sections 4.02(a)(iii)(V), (W) and (Y).
(d) The Securities Administrator, on behalf of the Trustee, shall
establish and maintain the Distribution Account on behalf of the
Certificateholders. The Securities Administrator shall segregate and hold all
funds in the Distribution Account separate and apart from its own funds and
general assets. The Securities Administrator shall, promptly upon receipt,
deposit in the Distribution Account and retain therein the following:
(i) the aggregate amount remitted by the Servicer to the Master
Servicer pursuant to Section 3.11(a)(i) which amounts the Master Servicer
will then remit to the Securities Administrator prior to the related
distribution date;
(ii) any amount deposited by the Servicer pursuant to Section
3.10 in connection with any losses on Permitted Investments; and
(iii) any other amounts deposited hereunder which are required to
be deposited in the Distribution Account.
In the event that the Servicer remit any amount not required to be
remitted, it may at any time direct the Securities Administrator in writing to
withdraw such amount from the Distribution Account, any provision herein to the
contrary notwithstanding. Such direction may be accomplished by delivering
notice to the Securities Administrator which describes the amounts deposited in
error in the Distribution Account. All funds deposited in the Distribution
Account shall be held by the Securities Administrator in trust for the
Certificateholders until disbursed in accordance with this Agreement or
withdrawn in accordance with Section 4.02. In no event shall the Securities
Administrator incur liability for withdrawals from the Distribution Account at
the direction of the Servicer.
(e) The Securities Administrator, on behalf of the Trustee, shall
establish and maintain the Capitalized Interest Account, on behalf of the
Certificateholders. On the Closing Date, the Securities Administrator shall
deposit $100.00 into the Capitalized Interest Account received from the
Unaffiliated Seller. Withdrawals from the Capitalized Interest Account shall be
made in accordance with Sections 4.02(c) and (d). The Securities Administrator
shall account for the Capitalized Interest Account as an outside reserve fund
within the meaning of Treasury regulations section 1.860G-2(h) and not as an
asset of any REMIC created pursuant to this Agreement. The beneficial owner of
the Capitalized Interest Account shall be the Unaffiliated Seller.
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(f) The Securities Administrator, on behalf of the Trustee, shall
establish and maintain the Pre-Funding Account on behalf of the
Certificateholders. On the Closing Date, the Securities Administrator shall
deposit the Initial Pre-Funded Amount into the Pre-Funding Account from the
proceeds of the sale of the LIBOR Certificates. Withdrawals from the Pre-Funding
Account shall be made in accordance with Sections 4.02(e) and (f).
(g) The Securities Administrator may invest the funds in the Accounts,
other than the Collection Account, the Excess Reserve Fund Account or the
Distribution Account, with prior written investment direction. With respect to
the Distribution Account and the Excess Reserve Fund Account such funds shall be
held uninvested. With respect to the Pre-Funding Account and the Capitalized
Interest Account such direction shall be provided by the Unaffiliated Seller,
and shall be in Permitted Investments and such directions shall be in accordance
with Section 3.12.
(h) The Servicer shall give prior written notice to the Trustee, the
Securities Administrator, the Master Servicer, each Rating Agency and the
Depositor of any proposed change of the location of the Collection Account.
(i) To help fight the funding of terrorism and money laundering
activities, the Trustee will obtain, verify, and record information that
identifies individuals or entities that establish a relationship or open an
account with the Trustee. The Trustee will ask for the name, address, tax
identification number and other information that will allow the Trustee to
identify the individual or entity who is establishing the relationship or
opening the account. The Trustee may also ask for formation documents such as
articles or incorporation, an offering memorandum, or other identifying
documents to be provided.
(j) The Securities Administrator shall establish and maintain the
Pre-Funding Reserve Account, on behalf of the Class X Certificateholders. On the
Closing Date, the Unaffiliated Seller shall remit to the Securities
Administrator and the Securities Administrator shall deposit $4,949,810 into the
Pre-Funding Reserve Account. The Securities Administrator shall account for the
Pre-Funding Reserve Account as an outside reserve fund within the meaning of
Treasury regulations section 1.860G-2(h) and not as an asset of any REMIC
created pursuant to this Agreement. For federal income tax purposes, the
beneficial owner of the funds in the Pre-Funding Reserve Account shall be the
Unaffiliated Seller. On the Closing Date, the Class X Certificateholders' rights
in the Pre-Funding Reserve Account will be conveyed to Xxxxx Fargo Bank,
National Association, as indenture trustee on behalf of the Noteholders of the
IXIS Real Estate Capital Inc. NIM 2007-HE1N Notes and shall be subject to the
terms of the NIM Indenture.
(k) On each Subsequent Transfer Date, the amount required to remain on
deposit in the Pre-Funding Reserve Account will be permitted to step down to an
amount equal to the product of (a) $4,949,810 multiplied by (b) a fraction, the
numerator of which is the amount remaining in the Pre-Funding Account (after
giving effect to any withdrawals on such Subsequent Transfer Date) and the
denominator of which is the Initial Pre-Funded Amount. Any excess amount that is
not required to remain in the Pre-Funding Reserve Account will be withdrawn by
the Securities Administrator from the Pre-Funding Reserve Account and released
to the Unaffiliated Seller.
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(l) On any Subsequent Transfer Date on which at least 99% of the
Initial Pre-Funded Amount has been used to purchase Subsequent Mortgage Loans,
the Securities Administrator shall withdraw and release to the Unaffiliated
Seller any remaining amounts in the Pre-Funding Reserve Account. If less than
99% of the Initial Pre-Funded Amount has been used to purchase Subsequent
Mortgage Loans, then on the Distribution Date following the end of the
Pre-Funding Period, the Securities Administrator shall (a) withdraw an amount
equal to (i) the percentage of the Initial Pre-Funded Amount not used to
purchase Subsequent Mortgage Loans multiplied by (ii) $4,949,810 and remit such
amount to the Class X Certificateholders and (b) withdraw any remaining amounts
in the Pre-Funding Reserve Account and release such amounts to the Unaffiliated
Seller, and thereafter the Pre-Funding Reserve Account shall be terminated.
(m) The Securities Administrator, on behalf of the Trustee, shall
establish and maintain the Swap Account, on behalf of the Supplemental Interest
Trust and the Swap Provider. Withdrawals from the Swap Account shall be made in
accordance with Section 4.02(h) and all funds therein shall be held uninvested.
(n) The Securities Administrator shall pay the Trustee an annual fee
based on a separate fee schedule. The fee of the Trustee shall be payable solely
by the Securities Administrator from its own funds. The expenses of the Trustee,
if any, shall be paid from the Trust Fund and the fees and expenses of the
Custodian shall be paid in accordance with Section 8.05.
(o) The Servicer shall pursue collection efforts on Mortgage Loans
which are Delinquent in accordance with the provisions of this Agreement until
the date on which the Mortgage Loan becomes 180 days Delinquent (the "Charge-off
Date"). If the Servicer determines in its sole discretion that net Liquidation
Proceeds with respect to such Mortgage Loan are unlikely to exceed the costs and
expenses of such foreclosure, the Servicer shall charge-off such Mortgage Loan
as of the applicable Charge-off Date. Once a Mortgage Loan is so charged-off,
unless foreclosure proceedings are ongoing or the related Mortgagor has
commenced bankruptcy proceedings, the Servicer shall have the right to appoint
(and to subsequently terminate) one or more agents (none of which may be an
Affiliate of the Servicer) (each a "Deficiency Collection Agent") for the
purpose of pursuing additional collections relating to such charged-off Mortgage
Loans (any such collection, a "Deficiency Collection"); provided, however, that
the Servicer shall not make any such appointment unless the applicable
Deficiency Collection Agent enters into a written agreement with the Servicer
(with a copy to the Trustee) to (i) promptly remit any Deficiency Collection
(net of any fees and expenses the Deficiency Collection Agent is permitted to
retain, as set forth in such agreement) to the Servicer promptly upon receipt by
such Deficiency Collection Agent, (ii) indemnify the Servicer, Trust Fund, the
Trustee, the Unaffiliated Seller and the Depositor and hold them harmless
against any and all claims, losses, penalties, fines, forfeitures, legal fees
and related costs, judgments, and any other costs, liability, fees and expenses
that they may incur or sustain as a result of any act or omission by the
Deficiency Collection Agent, and (iii) make the Trust Fund and the Trustee
third-party beneficiaries of such agreement. The Trustee shall reasonably
cooperate with the Deficiency Collection Agent with respect to its reasonable
requests in connection obtaining any Deficiency Collection. The Trustee shall
have no obligation to approve of, or consent to, the appointment or termination
of any Deficiency Collection Agent and shall have no obligation or
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responsibility to supervise or monitor any of its activities or actions, or to
verify compliance with any written agreement with such Deficiency Collection
Agent.
To the extent a Deficiency Collection Agent recovers any Deficiency
Collection, such Deficiency Collection (net of any fees and expenses the
Deficiency Collection Agent is permitted to retain) shall be remitted by the
Servicer to the Master Servicer on the next Remittance Date and such amount
shall be first, applied as a Subsequent Recovery, if applicable, and second,
distributed by the Securities Administrator on the next Distribution Date as
part of the Available Funds in accordance with Section 4.02.
Section 3.08 Subservicing Accounts.
In those cases where a Subservicer is servicing a Mortgage Loan
pursuant to a Subservicing Agreement, the Subservicer will be required to
establish and maintain one or more accounts (collectively, the "Subservicing
Account"). The Subservicing Account shall be an Eligible Account and shall
otherwise be acceptable to the Servicer. The Subservicer shall deposit in the
clearing account (which account must be an Eligible Account) in which it
customarily deposits payments and collections on mortgage loans in connection
with its mortgage loan servicing activities on a daily basis, and in no event
more than one Business Day after the Subservicer's receipt thereof, all proceeds
of Mortgage Loans received by the Subservicer less its servicing compensation to
the extent permitted by the Subservicing Agreement, and shall thereafter deposit
such amounts in the Subservicing Account, in no event more than two Business
Days after the deposit of such funds into the clearing account. The Subservicer
shall thereafter deposit such proceeds in the Collection Account or remit such
proceeds to the Servicer for deposit in the Collection Account not later than
two Business Days after the deposit of such amounts in the Subservicing Account.
For purposes of this Agreement, the Servicer shall be deemed to have received
payments on the Mortgage Loans when the Subservicer receives such payments.
Section 3.09 Collection of Taxes, Assessments and Similar Items;
Escrow Accounts.
(a) The Servicer shall ensure that each of the first lien Mortgage
Loans serviced by the Servicer shall be covered by a paid-in-full,
life-of-the-loan tax service contract with a nationally recognized provider
acceptable to the Servicer (each, a "Tax Service Contract"). Each Tax Service
Contract shall be assigned to the Trustee, or its designee, at the Servicer's
expense in the event that the Servicer is terminated as servicer of the related
Mortgage Loan.
(b) To the extent that the services described in this paragraph (b)
are not otherwise provided pursuant to the Tax Service Contracts described in
paragraph (a) hereof, the Servicer undertakes to perform such functions. The
Servicer shall establish and maintain, or cause to be established and
maintained, one or more accounts (the "Escrow Accounts"), which shall be
Eligible Accounts. The Servicer shall deposit in the clearing account (which
account must be an Eligible Account) in which it customarily deposits payments
and collections on mortgage loans in connection with its mortgage loan servicing
activities on a daily basis, and in
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no event more than two Business Days after the Servicer's receipt thereof, all
collections from the Mortgagors (or related advances from Subservicers) for the
payment of taxes, assessments, hazard insurance premiums and comparable items
for the account of the Mortgagors ("Escrow Payments") collected on account of
the Mortgage Loans and shall thereafter deposit such Escrow Payments in the
Escrow Accounts, in no event more than one Business Day after the deposit of
such funds in the clearing account, for the purpose of effecting the payment of
any such items as required under the terms of this Agreement. Withdrawals of
amounts from an Escrow Account may be made only to (i) effect payment of taxes,
assessments, hazard insurance premiums, and comparable items; (ii) reimburse the
Servicer (or a Subservicer to the extent provided in the related Subservicing
Agreement) out of related collections for any advances made pursuant to Section
3.01 (with respect to taxes and assessments) and Section 3.13 (with respect to
hazard insurance); (iii) refund to Mortgagors any sums as may be determined to
be overages; (iv) pay interest, if required and as described below, to
Mortgagors on balances in the Escrow Account, and the Servicer shall be entitled
to withdraw from the Escrow Account any interest earned and not required to be
paid to Mortgagors; (v) clear and terminate the Escrow Account at the
termination of the Servicer's obligations and responsibilities in respect of the
Mortgage Loans under this Agreement, and the Servicer shall be entitled to
withdraw from the Escrow Account any interest earned and not required to be paid
to the Mortgagors; (vi) to transfer such funds to a replacement Escrow Account
that meets the requirements hereof; or (vii) recover amounts deposited in error.
As part of its servicing duties, the Servicer or Subservicer shall pay to the
Mortgagors interest on funds in Escrow Accounts, to the extent required by law
and, to the extent that interest earned on funds in the Escrow Accounts is
insufficient, to pay such interest from its or their own funds, without any
reimbursement therefor. To the extent that a Mortgage does not provide for
Escrow Payments, the Servicer shall determine whether any such payments are made
by the Mortgagor in a manner and at a time that avoids the loss of the Mortgaged
Property due to a tax sale or the foreclosure of a tax lien. The Servicer
assumes full responsibility for the payment of all such bills within such time
and shall effect payments of all such bills irrespective of the Mortgagor's
faithful performance in the payment of same or the making of the Escrow Payments
and shall make advances from its own funds to effect such payments; provided,
however, that such advances are deemed to be Servicing Advances.
Section 3.10 Collection Accounts.
(a) On behalf of the Trustee, the Servicer shall establish and
maintain, or cause to be established and maintained, a separate Eligible Account
(such account, a "Collection Account"), held in trust for the benefit of the
Trustee entitled "Deutsche Bank National Trust Company on behalf of IXIS Real
Estate Capital Trust 2007-HE1". On behalf of the Trustee, the Servicer shall
deposit or cause to be deposited in the clearing account (which account must be
an Eligible Account) in which it customarily deposits payments and collections
on mortgage loans in connection with its mortgage loan servicing activities on a
daily basis, and in no event more than two Business Days after the Servicer's
receipt thereof, and shall thereafter deposit in the Collection Account, in no
event more than one Business Day after the deposit of such funds into the
clearing account, as and when received or as otherwise required hereunder, the
following payments and collections received or made by it subsequent to the
related Cut-off Date (other than Principal Prepayments) received by it on or
prior to the related Cut-off Date but allocable to a Due Period subsequent
thereto:
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(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest (net of the related
Servicing Fee) on each Mortgage Loan;
(iii) all Insurance Proceeds and Condemnation Proceeds to the
extent such Insurance Proceeds and Condemnation Proceeds are not to be
applied to the restoration of the related Mortgaged Property or released to
the related Mortgagor in accordance with the express requirements of law or
in accordance with Accepted Servicing Practices, and Liquidation Proceeds;
(iv) any amounts required to be deposited pursuant to Section
3.12 in connection with any losses realized on Permitted Investments with
respect to funds held in the Collection Account;
(v) any amounts required to be deposited by the Servicer pursuant
to the second paragraph of Section 3.13(a) in respect of any blanket policy
deductibles;
(vi) all proceeds of any Mortgage Loan repurchased or purchased
in accordance with this Agreement;
(vii) all Prepayment Charges collected by the Servicer; and
(viii) any amounts collected or received by the Servicer pursuant
to Section 3.07(o) hereof.
The foregoing requirements for deposit in the Collection 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, NSF
fees, reconveyance fees, assumption fees and other similar fees and charges need
not be deposited by the Servicer in the Collection Account and shall, upon
collection, belong to the Servicer as additional compensation for its servicing
activities. In the event that the Servicer shall deposit in the Collection
Account any amount not required to be deposited therein, the Servicer may at any
time withdraw such amount from the Collection Account, any provision herein to
the contrary notwithstanding.
(b) Funds in the Collection Account may be invested in Permitted
Investments in accordance with the provisions set forth in Section 3.12. The
Servicer shall give notice to the Trustee, the Securities Administrator, the
Master Servicer and the Depositor of the location of the Collection Account
maintained when established and prior to any change thereof.
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Section 3.11 Withdrawals from the Collection Account.
(a) The Servicer shall, from time to time, make withdrawals from the
Collection Account for any of the following purposes or as described in Section
4.01:
(i) On or prior to each Remittance Date, to remit to the Master
Servicer the Interest Remittance Amount and the Principal Remittance Amount
in respect of the related Distribution Date together with all amounts
representing Prepayment Charges from the Mortgage Loans received during the
related Prepayment Period;
(ii) to reimburse the Servicer or the Master Servicer for
xxxxxxxxxxxx X&X Advances, but only to the extent of amounts received which
represent Late Collections (net of the related Servicing Fee) of Scheduled
Payments on Mortgage Loans that it Services with respect to which such P&I
Advances were made in accordance with the provisions of Section 4.01;
(iii) to pay the Servicer, the Master Servicer or any Subservicer
(a) any unpaid Servicing Fee or (b) any unreimbursed Servicing Advances
with respect to each Mortgage Loan that it services, but only to the extent
of any Late Collections, Liquidation Proceeds, Condemnation Proceeds,
Insurance Proceeds, or other amounts as may be collected by the Servicer
from the related Mortgagor, or otherwise received with respect to such
Mortgage Loan (or the related REO Property);
(iv) to pay to the Servicer as servicing compensation (in
addition to the Servicing Fee) on the Remittance Date any interest or
investment income earned on funds deposited in the Collection Account and
any Prepayment Interest Excesses;
(v) to pay to the Unaffiliated Seller or the related Originator,
as applicable, with respect to each Mortgage Loan that it services that has
previously been purchased or replaced by the Unaffiliated Seller or such
Originator, as applicable, pursuant to this Agreement, all amounts received
thereon subsequent to the date of purchase or substitution, as the case may
be;
(vi) to reimburse the Servicer or the Master Servicer for (a) any
P&I Advance or Servicing Advance previously made which the Servicer has
determined to be a Nonrecoverable P&I Advance or Nonrecoverable Servicing
Advance in accordance with the provisions of Section 4.01 and (b) any
unpaid Servicing Fee to the extent not recoverable from Late Collections,
Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds, or other
amounts received with respect to the related Mortgage Loan under Section
3.11(a)(iii); provided, that this clause (b) shall only apply with respect
to the Servicing Fee for second lien Mortgage Loans;
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(vii) to pay, or to reimburse the Servicer for advances in
respect of, expenses incurred in connection with any Mortgage Loan pursuant
to Section 3.15;
(viii) to reimburse the Servicer, the Master Servicer, the
Depositor, the Custodian, the Securities Administrator or the Trustee for
expenses and/or indemnities incurred by or reimbursable to the Servicer,
the Depositor, the Custodian, the Securities Administrator or the Trustee,
as the case may be, pursuant to Section 6.03;
(ix) to reimburse the Servicer, the Unaffiliated Seller, the
Depositor, the Custodian, the Master Servicer, the Securities Administrator
or the Trustee, as the case may be, for expenses reasonably incurred in
respect of the breach or defect giving rise to the repurchase obligation
under Section 2.03 of this Agreement that were included in the Repurchase
Price of the Mortgage Loan, including any expenses arising out of the
enforcement of the repurchase obligation to the extent not otherwise paid
pursuant to the terms hereof;
(x) to invest funds in Permitted Investments in accordance with
Section 3.12;
(xi) to withdraw any amounts deposited in the Collection Account
in error; and
(xii) to clear and terminate the Collection Account upon
termination of this Agreement.
(b) The Servicer shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawal from its Collection Account, to the extent held by or on behalf of
it, pursuant to subclauses (a)(ii), (iii), (v), (vi), (vii), (viii) and (ix)
above. The Servicer shall provide written notification to the Master Servicer,
on or prior to the next succeeding Remittance Date, upon making any withdrawals
from the Collection Account pursuant to subclause (a)(vi) above.
(c) The Servicer shall be responsible for reviewing and reconciling
the Collection Account in accordance with Accepted Servicing Practices. The
Servicer shall act promptly to resolve any discrepancies.
Section 3.12 Investment of Funds in the Accounts.
(a) The Servicer may invest funds in its Collection Account and the
Master Servicer may direct the Securities Administrator to invest funds in the
Distribution Account, and the Unaffiliated Seller may direct the Securities
Administrator to invest the funds in the Pre-Funding Account, the Pre-Funding
Reserve Account and the Capitalized Interest Account (each of such Accounts, for
purposes of this Section 3.12, an "Investment Account"), in one or more
Permitted Investments bearing interest or sold at a discount, and maturing,
unless payable on
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demand no later than the second Business Day immediately preceding the date on
which such funds are required to be withdrawn from such account pursuant to this
Agreement. All such investment directions shall be in writing and if the
Securities Administrator does not receive such written instructions the
Securities Administrator shall invest such amounts in the Xxxxx Fargo Advantage
Prime Money Market Fund. All such Permitted Investments shall be held to
maturity, unless payable on demand. Any investment of funds in an Investment
Account (other than the Collection Account) shall be made in the name of the
Securities Administrator. The Securities Administrator shall be entitled to sole
possession (except with respect to investment direction of funds held in the
related Account and any income and gain realized thereon) over each such
investment, and any certificate or other instrument evidencing any such
investment shall be delivered directly to the Securities Administrator or its
agent, together with any document of transfer necessary to transfer title to
such investment to the Securities Administrator. Any investment of funds in the
Collection Account shall be made in the name of the Servicer. The Servicer shall
be entitled to sole possession (except with respect to investment direction of
funds held in the related Account and any income and gain realized thereon) over
each such investment, and any certificate or other instrument evidencing any
such investment shall be delivered directly to the Servicer or its agent,
together with any document of transfer necessary to transfer title to such
investment to the Servicer. In the event amounts on deposit in an Investment
Account are at any time invested in a Permitted Investment payable on demand,
the Securities Administrator may:
(i) consistent with any notice required to be given thereunder,
demand that payment thereon be made on the last day such
Permitted Investment may otherwise mature hereunder in an amount
equal to the lesser of (1) all amounts then payable thereunder
and (2) the amount required to be withdrawn on such date; and
(ii) demand payment of all amounts due thereunder that such Permitted
Investment would not constitute a Permitted Investment in respect
of funds thereafter on deposit in the Investment Account.
(b) (i) All income and gain realized from the investment of funds
deposited in the Collection Account shall be for the benefit of the Servicer and
shall be subject to its withdrawal in the manner set forth in Section 3.11. The
Servicer shall deposit in the Collection Account the amount of any loss of
principal incurred in respect of any such Permitted Investment directed by the
Servicer made with funds in such accounts immediately upon realization of such
loss. (ii) All income and gain realized from the investment of funds deposited
in the Pre-Funding Account, the Pre-Funding Reserve Account and the Capitalized
Interest Account held by or on behalf of the Unaffiliated Seller shall be
retained in such Investment Account, subject to withdrawal as provided in
Section 4.02. Whether in regard to the Pre-Funding Account or the Capitalized
Interest Account, the Unaffiliated Seller shall deposit in the Pre-Funding
Account or the Capitalized Interest Account, as applicable, the amount of any
loss of principal incurred in respect of any such Permitted Investment made with
funds in such accounts immediately upon realization of such loss.
(c) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment, or
if a default occurs in
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any other performance required under any Permitted Investment, the Securities
Administrator shall take such action as may be appropriate to enforce such
payment or performance, including the institution and prosecution of appropriate
proceedings. The Securities Administrator shall not be liable for the amount of
any loss incurred in respect of any investment or lack of investment of funds
held in any Investment Account or the Distribution Account if made in accordance
with this Section 3.12.
(d) The Securities Administrator and Master Servicer or any of their
Affiliates shall be permitted to receive additional compensation that could be
deemed to be in the Securities Administrator's or Master Servicer's economic
self-interest for (i) serving as investment adviser, administrator, shareholder,
servicing agent, custodian or sub-custodian with respect to certain of the
Permitted Investments, (ii) using Affiliates to effect transactions in certain
Permitted Investments and (iii) effecting transactions in certain Permitted
Investments. Such compensation shall not be considered an amount that is
reimbursable or payable pursuant to this Agreement.
Section 3.13 Maintenance of Hazard Insurance and Errors and Omissions
and Fidelity Coverage.
(a) The Servicer shall cause to be maintained for each Mortgaged
Property securing any Mortgage Loan serviced by the Servicer fire insurance with
extended coverage on the related Mortgaged Property in an amount which is at
least equal to the least of (i) the outstanding principal balance of such
Mortgage Loan, (ii) the amount necessary to fully compensate for any damage or
loss to the improvements that are a part of such property on a replacement cost
basis and (iii) the maximum insurable value of the improvements which are a part
of such Mortgaged Property, in each case in an amount not less than such amount
as is necessary to avoid the application of any coinsurance clause contained in
the related hazard insurance policy. The Servicer shall also cause to be
maintained fire insurance with extended coverage on each REO Property serviced
by the Servicer in an amount which is at least equal to the lesser of (i) the
maximum insurable value of the improvements which are a part of such property
and (ii) the outstanding principal balance of the related Mortgage Loan at the
time it became an REO Property, plus accrued interest at the Mortgage Rate and
related Servicing Advances. The Servicer will comply in the performance of this
Agreement with all reasonable rules and requirements of each insurer under any
such hazard policies. Any amounts to be collected by the Servicer under any such
policies (other than amounts to be applied to the restoration or repair of the
property subject to the related Mortgage or amounts to be released to the
Mortgagor in accordance with the procedures that the Servicer would follow in
servicing loans held for its own account, subject to the terms and conditions of
the related Mortgage and Mortgage Note) shall be deposited in the Collection
Account, subject to withdrawal pursuant to Section 3.11. Any cost incurred by
the Servicer in maintaining any such insurance shall not, for the purpose of
calculating distributions to the Securities Administrator, be added to the
unpaid principal balance of the related Mortgage Loan, notwithstanding that the
terms of such Mortgage Loan so permit. It is understood and agreed that no
earthquake or other additional insurance is to be required of any Mortgagor
other than pursuant to such applicable laws and regulations as shall at any time
be in force and as shall require such additional insurance. If the Mortgaged
Property or REO Property is at any time in an area identified in the Federal
Register by the Federal Emergency Management Agency as having special flood
hazards and flood insurance has been
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made available, the Servicer will cause to be maintained a flood insurance
policy in respect thereof. Such flood insurance shall be in an amount equal to
the lesser of (i) the unpaid principal balance of the related Mortgage Loan and
(ii) the maximum amount of such insurance available for the related Mortgaged
Property under the national flood insurance program (assuming that the area in
which such Mortgaged Property is located is participating in such program).
In the event that the Servicer shall obtain and maintain a blanket
policy with an insurer having a General Policy Rating of A:X or better from
Best's (or such other rating that is comparable to such rating) insuring against
hazard losses on all of the Mortgage Loans, it shall conclusively be deemed to
have satisfied its obligations as set forth in the first two sentences of this
Section 3.13, it being understood and agreed that such policy may contain a
deductible clause, in which case the Servicer shall, in the event that there
shall not have been maintained on the related Mortgaged Property or REO Property
a policy complying with the first two sentences of this Section 3.13, and there
shall have been one or more losses which would have been covered by such policy,
deposit to the Collection Account from its own funds the amount not otherwise
payable under the blanket policy because of such deductible clause. In
connection with its activities as administrator and servicer of the Mortgage
Loans, the Servicer agrees to prepare and present, on behalf of itself, the
Trustee claims under any such blanket policy in a timely fashion in accordance
with the terms of such policy.
(b) The Servicer shall keep in force during the term of this Agreement
a policy or policies of insurance covering errors and omissions for failure in
the performance of the Servicer's obligations under this Agreement, which policy
or policies shall be in such form and amount that would meet the requirements of
Xxxxxx Mae or Xxxxxxx Mac if it were the purchaser of the Mortgage Loans, unless
the Servicer has obtained a waiver of such requirements from Xxxxxx Mae or
Xxxxxxx Mac. The Servicer shall also maintain a fidelity bond in the form and
amount that would meet the requirements of Xxxxxx Mae or Xxxxxxx Mac, unless the
Servicer has obtained a waiver of such requirements from Xxxxxx Mae or Xxxxxxx
Mac. The Servicer shall provide the Master Servicer with copies of any such
insurance policies and fidelity bond upon the Master Servicer's request. The
Servicer shall be deemed to have complied with this provision if an Affiliate of
the Servicer has such errors and omissions and fidelity bond coverage and, by
the terms of such insurance policy or fidelity bond, the coverage afforded
thereunder extends to the Servicer. Any such errors and omissions policy and
fidelity bond shall by its terms not be canceled by the Servicer without thirty
days' prior written notice to the Master Servicer. The Servicer shall also cause
each Subservicer to maintain a policy of insurance covering errors and omissions
and a fidelity bond which would meet such requirements.
Section 3.14 Enforcement of Due-On-Sale Clauses Assumption Agreements.
The Servicer will, to the extent it has knowledge of any conveyance or
prospective conveyance of any Mortgaged Property by any Mortgagor (whether by
absolute conveyance or by contract of sale, and whether or not the Mortgagor
remains or is to remain liable under the Mortgage Note and/or the Mortgage),
exercise its rights to accelerate the maturity of such Mortgage Loan under the
"due-on-sale" clause, if any, applicable thereto; provided, however, that the
Servicer shall not be required to take such action if, in its sole business
judgment, the Servicer believes it is not in the best interests of the Trust
Fund and shall not exercise any such rights if prohibited by law from doing so.
If the Servicer reasonably
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believes it is unable under applicable law to enforce such "due-on-sale" clause
or if any of the other conditions set forth in the proviso to the preceding
sentence apply, the Servicer will enter into an assumption and modification
agreement from or with the person to whom such property has been conveyed or is
proposed to be conveyed, pursuant to which such person becomes liable under the
Mortgage Note and, to the extent permitted by applicable state law, the
Mortgagor remains liable thereon. The Servicer is also authorized to enter into
a substitution of liability agreement with such person, pursuant to which the
original Mortgagor is released from liability and such person is substituted as
the Mortgagor and becomes liable under the Mortgage Note; provided that no such
substitution shall be effective unless such person satisfies the underwriting
criteria of the Servicer, and such substitution is in the best interest of the
Certificateholders as determined by the Servicer. In connection with any
assumption, modification or substitution, the Servicer shall apply such
underwriting standards and follow such practices and procedures as shall be
normal and usual in its general mortgage servicing activities and as it applies
to other mortgage loans owned solely by it. The Servicer shall not take or enter
into any assumption and modification agreement, however, unless (to the extent
practicable in the circumstances) it shall have received confirmation, in
writing, of the continued effectiveness of any applicable hazard insurance
policy, or a new policy meeting the requirements of this Section is obtained.
Any fee collected by the Servicer in respect of an assumption or substitution of
liability agreement will be retained by the Servicer as additional servicing
compensation. In connection with any such assumption, no material term of the
Mortgage Note (including, but not limited to, the related Mortgage Rate and the
amount of the Scheduled Payment) may be amended or modified, except as otherwise
required pursuant to the terms thereof. The Servicer shall notify the Trustee,
the Securities Administrator, the Master Servicer and the Custodian that any
such substitution, modification or assumption agreement has been completed and
forward to the Custodian the executed original of such substitution or
assumption agreement, which document shall be added to the related Mortgage File
and shall, for all purposes, be considered a part of such Mortgage File to the
same extent as all other documents and instruments constituting a part thereof.
Notwithstanding the foregoing paragraph or any other provision of this
Agreement, the Servicer shall not be deemed to be in default, breach or any
other violation of its obligations hereunder by reason of any assumption of a
Mortgage Loan by operation of law or by the terms of the Mortgage Note or any
assumption which the Servicer may be restricted by law from preventing, for any
reason whatsoever. For purposes of this Section 3.14, the term "assumption" is
deemed to also include a sale (of the Mortgaged Property) subject to the
Mortgage that is not accompanied by an assumption or substitution of liability
agreement.
Section 3.15 Realization Upon Defaulted Mortgage Loans.
The Servicer shall use its best efforts, consistent with Accepted
Servicing Practices, to, except with respect to Mortgage Loans that have been
charged-off pursuant to Section 3.07(o), foreclose upon or otherwise comparably
convert (which may include an acquisition of REO Property) the ownership of
properties securing such of the Mortgage Loans as come into and continue in
default and as to which no satisfactory arrangements can be made for collection
of delinquent payments pursuant to Section 3.07, and which are not released from
this Agreement pursuant to any other provision hereof. The Servicer shall use
reasonable efforts to realize upon such defaulted Mortgage Loans in such manner
as will maximize the receipt of principal and interest, taking into account,
among other things, the timing of foreclosure
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proceedings. The foregoing is subject to the provisions that, in any case in
which Mortgaged Property shall have suffered damage from an uninsured cause, the
Servicer shall not be required to expend its own funds toward the restoration of
such property unless it shall determine in its sole discretion (i) that such
restoration will increase the net proceeds of liquidation of the related
Mortgage Loan, after reimbursement to itself for such expenses, and (ii) that
such expenses will be recoverable by the Servicer through Insurance Proceeds,
Condemnation Proceeds or Liquidation Proceeds from the related Mortgaged
Property, as contemplated in Section 3.11. The Servicer shall be responsible for
all other costs and expenses incurred by it in any such proceedings; provided,
however, that it shall be entitled to reimbursement thereof from the related
property, as contemplated in Section 3.11.
The proceeds of any liquidation or REO Disposition, as well as any
recovery resulting from a partial collection of Insurance Proceeds, Condemnation
Proceeds or Liquidation Proceeds or any income from an REO Property, will be
applied in the following order of priority: first, to reimburse the Servicer or
any Subservicer for any related unreimbursed Servicing Advances, pursuant to
Section 3.11 or 3.17; second, to reimburse the Servicer for any related
xxxxxxxxxxxx X&X Advances, pursuant to Section 3.11; third, to accrued and
unpaid interest on the Mortgage Loan or REO Imputed Interest, at the Mortgage
Rate, to the date of the liquidation or REO Disposition, or to the Due Date
prior to the Remittance Date on which such amounts are to be distributed if not
in connection with a liquidation or REO Disposition and fourth, as a recovery of
principal of the Mortgage Loan. If the amount of the recovery so allocated to
interest is less than a full recovery thereof, that amount will be allocated as
follows: first, to unpaid Servicing Fee; and second, as interest at the Mortgage
Rate (net of the Servicing Fee Rate). The portion of the recovery so allocated
to unpaid Servicing Fee shall be reimbursed to the Servicer or any Subservicer
pursuant to Section 3.11 or 3.17. The portions of the recovery so allocated to
interest at the Mortgage Rate (net of the Servicing Fee Rate) and to principal
of the Mortgage Loan shall be applied as follows: first, to reimburse the
Servicer or any Subservicer for any related unreimbursed Servicing Advances in
accordance with Section 3.11 or 3.17, and second, to the Securities
Administrator in accordance with the provisions of Section 4.02, subject to the
last paragraph of Section 3.17 with respect to certain excess recoveries from an
REO Disposition.
Notwithstanding anything to the contrary contained herein, in
connection with a foreclosure or acceptance of a deed in lieu of foreclosure, in
the event the Servicer has received actual notice of, or has actual knowledge of
the presence of, hazardous or toxic substances or wastes on the related
Mortgaged Property, or if the Master Servicer otherwise requests, the Servicer
shall cause an environmental inspection or review of such Mortgaged Property to
be conducted by a qualified inspector. Upon completion of the inspection, the
Servicer shall promptly provide the Master Servicer with a written report of the
environmental inspection.
After reviewing the environmental inspection report, the Servicer
shall determine consistent with Accepted Servicing Practices, how to proceed
with respect to the Mortgaged Property. In the event (a) the environmental
inspection report indicates that the Mortgaged Property is contaminated by
hazardous or toxic substances or wastes and (b) the Servicer determines,
consistent with Accepted Servicing Practices, to proceed with foreclosure or
acceptance of a deed in lieu of foreclosure, the Servicer shall be reimbursed
for all reasonable costs associated with such foreclosure or acceptance of a
deed in lieu of foreclosure and any
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related environmental clean-up costs, as applicable, from the related
Liquidation Proceeds, or if the Liquidation Proceeds are insufficient to fully
reimburse the Servicer, the Servicer shall be entitled to be reimbursed from
amounts in the Collection Account pursuant to Section 3.11. In the event the
Servicer determines not to proceed with foreclosure or acceptance of a deed in
lieu of foreclosure, the Servicer shall be reimbursed from general collections
for all Servicing Advances made with respect to the related Mortgaged Property
from the Collection Account pursuant to Section 3.11.
Section 3.16 Release of Mortgage Files.
(a) Upon the payment in full of any Mortgage Loan, or the receipt by
the Servicer of a notification that payment in full shall be escrowed in a
manner customary for such purposes, the Servicer will, within five (5) Business
Days of the payment in full, notify the Trustee, the Securities Administrator
and the Custodian by a certification (which certification shall include a
statement to the effect that all amounts received or to be received in
connection with such payment which are required to be deposited in the
Collection Account pursuant to Section 3.10 have been or will be so deposited)
of a Servicing Officer and shall request delivery to it of the Custodial File.
Upon receipt of such certification and Request for Release, the Custodian shall
promptly release the related Custodial File to the Servicer within five (5)
Business Days. No expenses incurred in connection with any instrument of
satisfaction or deed of reconveyance shall be chargeable to the Collection
Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection under
any Insurance Policy relating to the Mortgage Loans, the Custodian shall, upon
request of the Servicer and delivery to the Custodian, of a Request for Release,
release the related Custodial File to the Servicer, and the Trustee shall, at
the direction of the Servicer, execute such documents as shall be necessary to
the prosecution of any such proceedings and the Servicer shall retain the
Mortgage File in trust for the benefit of the Trustee. Such Request for Release
shall obligate the Servicer to return each and every document previously
requested from the Custodial File to the Custodian when the need therefor by the
Servicer no longer exists, unless the Mortgage Loan has been charged-off or
liquidated and the Liquidation Proceeds relating to the Mortgage Loan have been
deposited in the Collection Account or the Mortgage File or such document has
been delivered to an attorney, or to a public trustee or other public official
as required by law, for purposes of initiating or pursuing legal action or other
proceedings for the foreclosure of the Mortgaged Property either judicially or
non-judicially, and the Servicer has delivered to the Custodian a certificate of
a Servicing Officer certifying as to the name and address of the Person to which
such Mortgage File or such document was delivered and the purpose or purposes of
such delivery. Upon receipt of a certificate of a Servicing Officer stating that
such Mortgage Loan was charged-off or liquidated and that all amounts received
or to be received in connection with such liquidation that are required to be
deposited into the Collection Account have been so deposited, or that such
Mortgage Loan has become an REO Property, a copy of the Request for Release of
documents shall be released by the Custodian to the Servicer or its designee.
Upon written certification of a Servicing Officer, the Trustee shall
execute and deliver to the Servicer any court pleadings, requests for trustee's
sale or other documents reasonably necessary to the foreclosure or trustee's
sale in respect of a Mortgaged Property or to
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any legal action brought to obtain judgment against any Mortgagor on the
Mortgage Note or Mortgage or to obtain a deficiency judgment, or to enforce any
other remedies or rights provided by the Mortgage Note or Mortgage or otherwise
available at law or in equity, or shall exercise and deliver to the Servicer a
power of attorney sufficient to authorize the Servicer to execute such documents
on its behalf. Each such certification shall include a request that such
pleadings or documents be executed by the Trustee and a statement as to the
reason such documents or pleadings are required and that the execution and
delivery thereof by the Trustee will not invalidate or otherwise affect the lien
of the Mortgage, except for the termination of such a lien upon completion of
the foreclosure or trustee's sale.
Upon receipt of a Request for Release under this Section 3.16, the
Custodian shall deliver the related Custodial File to the Servicer by regular
mail, unless the Servicer requests that the Custodian deliver such Custodial
File to the Servicer by overnight courier (in which case such delivery shall be
at the Servicer's expense). To the extent that the Servicer requires an
overnight courier for such delivery and incurs the related expense due to the
Servicer not having previously received copies of the documents required to be
delivered to the Servicer hereunder, the Unaffiliated Seller shall use
commercially reasonable efforts to assist the Servicer in causing the related
Originator pursuant to the related Mortgage Loan Purchase Agreement to reimburse
the Servicer for such expense.
Section 3.17 Title, Conservation and Disposition of REO Property.
(a) This Section shall apply only to REO Properties acquired for the
account of the Trustee and shall not apply to any REO Property relating to a
Mortgage Loan which was purchased or repurchased from the Trustee pursuant to
any provision hereof. In the event that title to any such REO Property is
acquired, the Servicer shall cause the deed or certificate of sale to be issued
in the name of the Trustee, on behalf of the Certificateholders. Upon written
request by the Servicer, the Trustee shall provide the Servicer with a power of
attorney prepared by the Servicer with respect to such REO Property.
(b) The Servicer shall manage, conserve, protect and operate each REO
Property for the Trustee solely for the purpose of its prompt disposition and
sale. The Servicer, either itself or through an agent selected by the Servicer,
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 Servicer 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 Servicer
deems to be in the best interest of the Trustee on behalf of the
Certificateholders. The Servicer shall notify the Trustee, the Master Servicer
and the Securities Administrator from time to time as to the status of each REO
Property.
(c) [Reserved].
(d) [Reserved].
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(e) The Servicer shall segregate and hold all funds collected and
received in connection with the operation of any REO Property separate and apart
from its own funds and general assets and shall deposit such funds in the
Collection Account.
(f) The Servicer shall deposit net of reimbursement to the Servicer
for any related outstanding P&I Advances, Servicing Advances and unpaid
Servicing Fee provided in Section 3.11, or cause to be deposited, on a daily
basis in the Collection Account all revenues received with respect to the
related REO Property and shall withdraw therefrom funds necessary for the proper
operation, management and maintenance of the REO Property. The Master Servicer
shall retain all initial proceeds from REO Properties until all liquidation
proceeds with respect to such REO Properties have been received.
(g) The Servicer, upon an REO Disposition, shall be entitled to
reimbursement for any related xxxxxxxxxxxx X&X Advances and Servicing Advances
as well as any unpaid Servicing Fee from proceeds received in connection with
the REO Disposition, as further provided in Section 3.11.
(h) Any net proceeds from a REO Disposition which are in excess of the
applicable Stated Principal Balance plus all unpaid REO Imputed Interest thereon
through the date of the REO Disposition shall be retained by the Servicer as
additional servicing compensation.
(i) The Servicer shall use its reasonable best efforts to sell, or
cause the Subservicer to sell, any REO Property as soon as possible, but in no
event later than the conclusion of the third calendar year beginning after the
year of its acquisition by REMIC I unless (i) the Servicer applies for an
extension of such period from the Internal Revenue Service pursuant to the REMIC
Provisions and Code Section 856(e)(3), in which event such REO Property shall be
sold within the applicable extension period, or (ii) the Servicer obtains for
the Trustee and the Securities Administrator an Opinion of Counsel, addressed to
the Depositor, the Trustee, the Securities Administrator and the Servicer, to
the effect that the holding by REMIC I of such REO Property subsequent to such
period will not result in the imposition of taxes on "prohibited transactions"
as defined in Section 860F of the Code or cause any REMIC created hereunder to
fail to qualify as a REMIC under the REMIC Provisions or comparable provisions
of relevant state laws at any time. The Servicer shall manage, conserve, protect
and operate each REO Property that it services for the Trustee solely for the
purpose of its prompt disposition and sale in a manner which does not cause such
REO Property to fail to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) or result in the receipt by any REMIC created hereunder of
any "income from non-permitted assets" within the meaning of Section
860F(a)(2)(B) of the Code or any "net income from foreclosure property" which is
subject to taxation under Section 860G(a)(1) of the Code. Pursuant to its
efforts to sell such REO Property, the Servicer shall either itself or through
an agent selected by the Servicer protect and conserve such REO Property in the
same manner and to such extent as is customary in the locality where such REO
Property is located and may, incident to its conservation and protection of the
interests of the Trustee on behalf of the Certificateholders, rent the same, or
any part thereof, as the Servicer deems to be in the best interest of the
Trustee on behalf of the Certificateholders for the period prior to the sale of
such REO Property; provided, however, that any rent received or
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accrued with respect to such REO Property qualifies as "rents from real
property" as defined in Section 856(d) of the Code.
Section 3.18 Notification of Adjustments.
With respect to each Adjustable Rate Mortgage Loan that it services,
the Servicer shall adjust the Mortgage Rate on the related Adjustment Date and
shall adjust the Scheduled Payment on the related mortgage payment adjustment
date, if applicable, in compliance with the requirements of applicable law and
the related Mortgage and Mortgage Note. The Servicer shall execute and deliver
any and all necessary notices required under applicable law and the terms of the
related Mortgage Note and Mortgage regarding the Mortgage Rate and Scheduled
Payment adjustments. The Servicer shall promptly, upon written request therefor,
deliver to the Master Servicer such notifications and any additional applicable
data regarding such adjustments and the methods used to calculate and implement
such adjustments. Upon the discovery by the Servicer or the receipt of notice
from the Master Servicer that the Servicer has failed to adjust a Mortgage Rate
or Scheduled Payment in accordance with the terms of the related Mortgage Note,
the Servicer shall deposit in its Collection Account from its own funds the
amount of any interest loss caused as such interest loss occurs.
Section 3.19 Access to Certain Documentation and Information Regarding
the Mortgage Loans.
The Servicer shall provide, or cause the applicable Subservicer to
provide, to the Depositor, the Custodian, the Unaffiliated Seller, the
Securities Administrator, the Master Servicer, the Trustee, the OTS or the FDIC
and the examiners and supervisory agents thereof access to the documentation
regarding the Mortgage Loans in its possession. Such access shall be afforded
without charge, but only upon reasonable and prior written request and during
normal business hours at the offices of the Servicer or any Subservicer. Nothing
in this Section shall derogate from the obligation of any such party to observe
any applicable law prohibiting disclosure of information regarding the
Mortgagors and the failure of any such party to provide access as provided in
this Section as a result of such obligation shall not constitute a breach of
this Section.
Section 3.20 Documents, Records and Funds in Possession of the
Servicer to be Held for the Securities Administrator.
The Servicer shall account fully to the Trustee, the Master Servicer,
the Securities Administrator for any funds received by the Servicer or which
otherwise are collected by the Servicer as Liquidation Proceeds, Condemnation
Proceeds or Insurance Proceeds in respect of any Mortgage Loan. All Mortgage
Files and funds collected or held by, or under the control of, the Servicer in
respect of any Mortgage Loans, whether from the collection of principal and
interest payments or from Liquidation Proceeds, including, but not limited to,
any funds on deposit in the Collection Account, shall be held by the Servicer
for and on behalf of the Trustee and shall be and remain the sole and exclusive
property of the Trustee, subject to the applicable provisions of this Agreement.
The Servicer also agrees that it shall not create, incur or subject any Mortgage
File or any funds that are deposited in any Account, or any funds that otherwise
are or may become due or payable to the Securities Administrator for the benefit
of the
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Certificateholders, to any claim, lien, security interest, judgment, levy, writ
of attachment or other encumbrance, or assert by legal action or otherwise any
claim or right of setoff against any Mortgage File or any funds collected on, or
in connection with, a Mortgage Loan, except, however, that the Servicer shall be
entitled to set off against and deduct from any such funds any amounts that are
properly due and payable to the Servicer under this Agreement.
Section 3.21 Servicing Compensation.
(a) As compensation for its activities hereunder, the Servicer shall,
with respect to each Mortgage Loan, be entitled to retain from deposits to its
Collection Account and from Liquidation Proceeds, Condemnation Proceeds,
Insurance Proceeds and REO Proceeds related to such Mortgage Loan, the Servicing
Fee with respect to each Mortgage Loan that it services (less any portion of
such amounts retained by any Subservicer). In addition, the Servicer shall be
entitled to recover unpaid Servicing Fee out of related late collections and as
otherwise permitted under Section 3.11. The right to receive the Servicing Fee
may not be transferred in whole or in part except in connection with the
transfer of all of the Servicer's responsibilities and obligations under this
Agreement; provided, however, that the Servicer may pay from the Servicing Fee
any amounts due to a Subservicer pursuant to a Subservicing Agreement entered
into under Section 3.02.
(b) Additional servicing compensation in the form of assumption or
modification fees, late payment charges, NSF fees, reconveyance fees and other
similar fees and charges (other than Prepayment Charges) shall be retained by
the Servicer only to the extent such fees or charges are received by the
Servicer. The Servicer shall also be entitled pursuant to Section 3.11(a)(iv) to
withdraw from the Collection Account, as additional servicing compensation,
interest or other income earned on deposits therein. In addition, the Servicer
shall be entitled to retain Prepayment Interest Excesses (to the extent not
required to offset Prepayment Interest Shortfalls), but only to the extent such
amounts are received by the Servicer.
(c) The Servicer shall be required to pay all expenses incurred by it
in connection with its servicing activities hereunder (including payment of
premiums for any blanket policy insuring against hazard losses pursuant to
Section 3.13, servicing compensation of the Subservicer to the extent not
retained by it and the fees and expenses of independent accountants and any
agents appointed by the Servicer), and shall not be entitled to reimbursement
therefor from the Trust Fund except as specifically provided in Section 3.11.
Section 3.22 Annual Statement as to Compliance.
The Servicer shall deliver, and shall cause each Subservicer engaged
by the Servicer to deliver or cause to be delivered, and the Master Servicer
shall deliver, to the Depositor, the Securities Administrator and the Trustee on
or before March 15th of each calendar year, commencing in 2008, an Officer's
Certificate stating, as to each signatory thereof, that (i) a review of the
activities of such Master Servicer, Servicer or Subservicer, as applicable,
during the preceding calendar year and of its performance under this Agreement
or the applicable Subservicing Agreement, as the case may be, has been made
under such officers' supervision, and (ii) to the best of such officers'
knowledge, based on such review, the Master Servicer, the Servicer or such
Subservicer, as applicable, has fulfilled all of its obligations under this
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Agreement or the applicable Subservicing Agreement, as the case may be, in all
material respects, throughout such year, or, if there has been a default in the
fulfillment of any such obligation in any material respect, specifying each such
default known to such officers and the nature and status thereof including the
steps being taken by the Master Servicer, Servicer or Subservicer, as
applicable. Promptly after receipt of each such Officer's Certificate, the
Depositor shall review such Officer's Certificate and, if applicable, consult
with the Master Servicer, the Servicer or the applicable Subservicer as to the
nature of any defaults by the Master Servicer, the Servicer or such Subservicer
in the fulfillment of any of the Master Servicer's, the Servicer's or such
Subservicer's obligations. The obligations of the Master Servicer, the Servicer
and each Subservicer under this Section apply to each Master Servicer, Servicer
and Subservicer that acted as Master Servicer or serviced a Mortgage Loan, as
applicable, during the applicable period, whether or not the Master Servicer,
the Servicer or any Subservicer is acting as Master Servicer, the Servicer or a
Subservicer, as applicable, at the time such Officer's Certificate is required
to be delivered. None of the Master Servicer, the Servicer or any Subservicer
shall be required to cause the delivery of any Officer's Certificate required by
this Section until March 24th in any given year so long as it has received
written confirmation from the Depositor that a Form 10-K is not required to be
filed in respect of the Trust for the preceding calendar year.
Section 3.23 Annual Independent Public Accountants' Servicing
Statement; Financial Statements.
(a) Not later than March 15th of each calendar year commencing in
2008, the Servicer, the Master Servicer and the Securities Administrator shall
deliver, and the Servicer shall cause each Subservicer engaged by the Servicer
and the Servicer, the Master Servicer and the Securities Administrator shall
cause each Subcontractor utilized by the Servicer (or by any such Subservicer)
or the Master Servicer or the Securities Administrator, as applicable, and
determined by the Servicer, the Master Servicer or the Securities Administrator,
as applicable, pursuant to Section 3.02(e) to be materially "participating in a
servicing function" within the meaning of Item 1122 of Regulation AB (in each
case, a "Servicing Function Participant"), to deliver, each at its own expense,
to the Depositor and the Securities Administrator, a report on an assessment of
compliance with the Servicing Criteria applicable to it that contains (A) a
statement by such party of its responsibility for assessing compliance with the
Servicing Criteria applicable to it, (B) a statement that such party used the
Servicing Criteria to assess compliance with the applicable Servicing Criteria,
(C) such party's assessment of compliance with the applicable Servicing Criteria
as of and for the period ending the end of the fiscal year covered by the Form
10-K required to be filed pursuant to Section 8.12, setting forth any material
instance of noncompliance with the applicable Servicing Criteria, a discussion
of each such failure and the nature and status thereof, and (D) a statement that
a registered public accounting firm has issued an attestation report on such
Person's assessment of compliance with the applicable Servicing Criteria as of
and for such period. Each such assessment of compliance report shall be signed
by an authorized officer of the applicable company, and shall address each of
the applicable Servicing Criteria set forth on Exhibit Q hereto, or as set forth
in the notification furnished to the Depositor and the Trustee pursuant to
Section 3.23(c). The parties to this Agreement acknowledge that where a
particular Servicing Criteria has multiple components, each party's assessment
of compliance (and related attestation of compliance) will relate only to those
components that are applicable to such party. The Servicer, the Securities
Administrator and the Master Servicer hereby acknowledge and agree that their
respective assessments of compliance
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will cover the items identified on Exhibit Q hereto as being covered by such
party. Promptly after receipt of each such report on assessment of compliance,
(i) the Depositor shall review each such report and, if applicable, consult with
the Servicer, the Securities Administrator or the Master Servicer as to the
nature of any material instance of noncompliance with the Servicing Criteria
applicable to it (and each Subservicer or Servicing Function Participant engaged
or utilized by the Servicer, such Subservicer, the Master Servicer or the
Securities Administrator, as applicable), as the case may be. None of the
Servicer, the Securities Administrator or the Master Servicer or any Subservicer
or Servicing Function Participant shall be required to cause the delivery of any
such assessments if a Form 10-K is not required to be filed in respect of the
Trust for the preceding calendar year.
(b) Not later than March 15th of each calendar year commencing in
2008, the Servicer, the Securities Administrator and the Master Servicer shall
cause, and the Servicer shall cause each Subservicer engaged by the Servicer and
the Servicer, the Securities Administrator and the Master Servicer shall cause
each Servicing Function Participant utilized by the Servicer, the Securities
Administrator or the Master Servicer, as applicable (or by any Subservicer
engaged by the Servicer), to cause, each at its own expense, a registered public
accounting firm (which may also render other services to such party) and that is
a member of the American Institute of Certified Public Accountants to furnish a
report to the Securities Administrator and the Depositor to the effect that (i)
it has obtained a representation regarding certain matters from the management
of such Person, which includes an assertion that such Person has complied with
the Servicing Criteria applicable to it pursuant to Section 3.23(a) and (ii) on
the basis of an examination conducted by such firm in accordance with standards
for attestation engagements issued or adopted by the PCAOB, that attests to and
reports on such Person's assessment of compliance with the Servicing Criteria
applicable to it. In the event that an overall opinion cannot be expressed, such
registered public accounting firm shall state in such report why it was unable
to express such an opinion. Each such related accountant's attestation report
shall be made in accordance with Rules 1-02(a)(3) and 2-02(g) of Regulation S-X
under the Securities Act and the Exchange Act. Such report must be available for
general use and not contain restricted use language. Promptly after receipt of
each such accountants' attestation report, the Depositor shall review the report
and, if applicable, consult with the Servicer, the Securities Administrator or
the Master Servicer as to the nature of any material instance of noncompliance
with the Servicing Criteria applicable to it (and each Subservicer or Servicing
Function Participant engaged or utilized by the Servicer, the Securities
Administrator or the Master Servicer, as applicable, or by any Subservicer
engaged by the Servicer), as the case may be, in the fulfillment of any of the
Servicer's, the Securities Administrator's, the Master Servicer's or the
applicable Subservicer's or Servicing Function Participant's obligations
hereunder or under any applicable sub-servicing agreement. None of the Servicer,
the Securities Administrator or the Master Servicer or any Subservicer or
Servicing Function Participant shall be required to cause the delivery of any
such attestation required by this paragraph if a Form 10-K is not required to be
filed in respect of the Trust for the preceding calendar year.
(c) No later than February 1 of each fiscal year, commencing in 2008,
the Servicer shall notify the Securities Administrator and the Depositor as to
the name of each Subservicer engaged by it and each Servicing Function
Participant utilized by it and by each Subservicer engaged by it, and each of
the Master Servicer and the Securities Administrator shall notify the Depositor
as to the name of each Servicing Function Participant utilized by it, and
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each such notice will specify what specific Servicing Criteria will be addressed
in the report on assessment of compliance prepared by such Servicing Function
Participant in each case, to the extent of any change from the prior year's
notice, if any. When the Servicer, the Master Servicer or the Securities
Administrator submits its assessment pursuant to Section 3.23(a), the Servicer,
the Master Servicer or the Securities Administrator, as applicable, will also at
such time include the assessment (and related attestation pursuant to Section
3.23(b)) of each Servicing Function Participant utilized by it and by each
Subservicer engaged by it.
Section 3.24 Master Servicer to Act as Servicer.
(a) [Reserved]
(b) In the event that Saxon shall for any reason no longer be the
Servicer hereunder (including by reason of an Event of Default), except as
provided under Section 7.02, the Master Servicer or its successor shall, within
90 days, assume all of the rights and obligations of Saxon hereunder arising
thereafter (except that the Master Servicer shall not be (i) liable for losses
of Saxon pursuant to Section 3.10 or any acts or omissions of the predecessor
Servicer hereunder, (ii) obligated to make Advances if it is prohibited from
doing so by applicable law, (iii) obligated to effectuate repurchases or
substitutions of Mortgage Loans hereunder, including, but not limited to,
repurchases or substitutions pursuant to Section 2.03, (iv) responsible for
expenses incurred by, or advances made by, the predecessor Servicer or (v)
deemed to have made any representations and warranties of the Servicer
hereunder).
Every subservicing agreement entered into by the Servicer shall
contain a provision giving the successor Servicer the option to terminate such
agreement in the event a successor Servicer is appointed.
If the Servicer shall for any reason no longer be the Servicer
(including by reason of any Event of Default), the Master Servicer (or any other
successor Servicer) may, at its option, succeed to any rights and obligations of
the Servicer under any subservicing agreement in accordance with the terms
thereof; provided that the Master Servicer (or any other successor Servicer)
shall not incur any liability or have any obligations in its capacity as
successor Servicer under a subservicing agreement arising prior to the date of
such succession unless it expressly elects to succeed to the rights and
obligations of the Servicer thereunder; and the Servicer shall not thereby be
relieved of any liability or obligations under the subservicing agreement
arising prior to the date of such succession.
The Servicer shall, upon request of the Master Servicer, as
applicable, but at the expense of the Servicer, deliver to the assuming party
all documents and records relating to each subservicing agreement (if any) and
the Mortgage Loans then being serviced thereunder and an accounting of amounts
collected and held by it and otherwise use its best efforts to effect the
orderly and efficient transfer of the subservicing agreement to the assuming
party.
Section 3.25 Compensating Interest.
The Servicer shall remit to the Master Servicer on each Remittance
Date an amount from its own funds equal to the Compensating Interest payable by
the Servicer for the related Distribution Date.
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Section 3.26 Credit Reporting; Xxxxx-Xxxxx-Xxxxxx Act.
(a) With respect to each Mortgage Loan that it services, the Servicer
agrees to fully furnish, in accordance with the Fair Credit Reporting Act and
its implementing regulations, accurate and complete information (i.e., favorable
and unfavorable) on its borrower credit files to Equifax, Experian, and Trans
Union Credit Information Company (three of the national credit repositories), on
a monthly basis.
(b) The Servicer shall comply with Title V of the Xxxxx-Xxxxx-Xxxxxx
Act of 1999 and all applicable regulations promulgated thereunder, relating to
the Mortgage Loans that it services and the related borrowers and shall provide
all required notices thereunder.
Section 3.27 Advance Facilities.
The Servicer is hereby authorized to enter into a financing or other
facility (an "Advance Facility") under which (l) the Servicer sells, assigns or
pledges to another Person (an "Advancing Person") the Servicer's rights under
this Agreement to be reimbursed for any Advances and/or (2) an Advancing Person
agrees to fund some or all P&I Advances or Servicing Advances required to be
made by the Servicer pursuant to this Agreement. The Servicer may enter into an
Advance Facility without the consent of any Person. Upon entering into any such
Advance Facility, the Servicer shall promptly notify the Securities
Administrator with a notice substantively in the form attached hereto as Exhibit
W and the Securities Administrator shall execute an acknowledgement of such
Advance Facility Notice promptly upon the receipt of such notice from the
Servicer. Notwithstanding the existence of any Advance Facility under which an
Advancing Person agrees to fund P&I Advances and/or Servicing Advances on the
Servicer's behalf, the Servicer shall remain obligated pursuant to this
Agreement to make P&I Advances and Servicing Advances pursuant to and as
required by this Agreement, and shall not be relieved of such obligations by
virtue of such Advance Facility.
An Advancing Person shall not be required to meet the criteria for
qualification of a subservicer set forth in this Agreement. An Advancing Person
shall be permitted to finance, or otherwise sell, assign, pledge or otherwise
transfer, any rights to reimbursement for Advances funded, financed or acquired
under the Advance Facility.
If the Servicer enters into an Advance Facility, the Servicer shall
deliver to the Trustee, the Securities Administrator and the Master Servicer a
notice (an "Advance Facility Notice") stating (a) the identity of the Advancing
Person and (b) the identity of the Person (the "Servicer's Assignee"), which may
be the Advancing Person, that will have the right to be reimbursed by the
Securities Administrator or the Master Servicer directly, or to make withdrawals
from the Servicer's Collection Account pursuant to Section 3.11 to reimburse
itself, for previously xxxxxxxxxxxx X&X Advances and/or Servicing Advances
("Advance Reimbursement Amounts"). Advance Reimbursement Amounts shall consist
solely of amounts in respect of P&I Advances and/or Servicing Advances for which
the Servicer would be permitted to reimburse itself in accordance with Section
3.11, assuming the Servicer had made the related P&I Advance(s) and/or Servicing
Advance(s). An Advance Facility may be terminated by the joint written direction
of the Servicer and the related Advancing Person. Upon any such termination, the
Servicer shall deliver to the Trustee, the Securities Administrator and
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the Master Servicer a notice (an "Advance Facility Termination Notice") stating
(a) the identity of the terminated Advancing Person and (b) the identity of the
Servicer's Assignee that will have the right to be reimbursed by the Securities
Administrator or the Master Servicer directly, or to make withdrawals from the
Servicer's Collection Account pursuant to Section 3.11 to reimburse itself, for
Advance Reimbursement Amounts.
Notwithstanding the existence of an Advance Facility, the Servicer, on
behalf of the Advancing Person, shall be entitled to receive reimbursements of
P&I Advances and/or Servicing Advances in accordance with Section 3.11, which
entitlement may be terminated by the Advancing Person pursuant to a written
notice to the Servicer, the Trustee, the Securities Administrator and the Master
Servicer. Upon receipt of such written notice, the Servicer shall no longer be
entitled to receive reimbursement for any Advance Reimbursement Amounts and the
Servicer's Assignee shall immediately have the right to receive from the
Collection Account all Advance Reimbursement Amounts. None of the Trustee, the
Securities Administrator, the Master Servicer or any Certificateholder shall
have any right to, or otherwise be entitled to, receive any Advance
Reimbursement Amounts to which the Servicer or Servicer's Assignee, as
applicable, shall be entitled pursuant to Section 3.11. Without limiting the
foregoing, none of the Trustee, the Securities Administrator, the Master
Servicer, any successor Servicer or other Person shall have any right of set-off
against Advance Reimbursement Amounts hereunder.
The Servicer shall maintain and provide to any successor Servicer a
detailed accounting on a loan-by-loan basis as to amounts advanced by, pledged
or assigned to, and reimbursed to any Advancing Person. The successor Servicer
shall be entitled to rely on any such information provided by the predecessor
Servicer, and the successor Servicer shall not be liable for any errors in such
information.
As between a predecessor Servicer and its Advancing Person, on the one
hand, and a successor Servicer and/or its Advancing Person, if any, on the other
hand, Advance Reimbursement Amounts on a loan-by-loan basis with respect to each
Mortgage Loan as to which a P&I Advance and/or Servicing Advance shall have been
made and be outstanding shall be allocated on a "first-in, first out" basis. In
the event the Servicer's Assignee shall have received some or all of an Advance
Reimbursement Amount related to P&I Advances and/or Servicing Advances that were
made by a Person other than such predecessor Servicer or its related Advancing
Person in error, then the Servicer's Assignee shall be required to remit any
portion of such Advance Reimbursement Amount to each Person entitled to such
portion of such Advance Reimbursement Amount. The Servicer shall remain entitled
to be reimbursed pursuant to the Advance Facility by the Advancing Person for
all P&I Advances and Servicing Advances funded by the Servicer to the extent the
related rights to be reimbursed therefor have not been sold, assigned or pledged
to an Advancing Person.
Any amendment to this Section 3.27 or to any other provision of this
Agreement that may be necessary or appropriate to effect the terms of an Advance
Facility as described generally in this Section 3.27, including amendments to
add provisions relating to successor Servicers, may be entered into by the
Trustee, the Securities Administrator, the Master Servicer, the Depositor, the
Unaffiliated Seller and the Servicer without the consent of any
Certificateholder notwithstanding anything to the contrary in this Agreement.
Notwithstanding anything to the contrary contained in this Agreement, this
Agreement shall not be amended,
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waived or modified in any respect without the prior written consent of an
Advancing Person if such amendment, waiver or modification would adversely
affect the rights of the Advancing Person hereunder in any material respect, it
being understood that the Advancing Person is an intended third party
beneficiary under this Agreement. The Securities Administrator shall be entitled
to rely on an Opinion of Counsel (which Opinion of Counsel shall not be an
expense of the Securities Administrator, the Master Servicer, the Trustee or the
Trust) as to whether the amendment will adversely affect the Advancing Person.
None of the Trustee, the Securities Administrator, or the Master Servicer is
obligated or liable to repay from its own funds any Advances financed, funded or
otherwise acquired by the Advancing Person, and none of the Master Servicer, the
Trustee or the Securities Administrator shall have any responsibility to track
or monitor the administration of the financing arrangement between the Servicer
and the Advancing Person. If the Servicer is replaced by a successor Servicer,
the Advancing Person shall continue to be entitled to receive reimbursements as
provided herein but shall have no further right to make further advances under
this Agreement. The pledge, if any, of Servicer's rights to the Applicable
Person under the Advance Facility conveys no other rights (such as a right to
fees after the removal of the Servicer or the right to become a substitute
Servicer) under this Agreement, or against the Trust Fund or any
Certificateholder or any other party to this Agreement other than the Servicer.
ARTICLE IV
DISTRIBUTIONS AND
ADVANCES BY THE SERVICER
Section 4.01 Advances.
(a) The amount of P&I Advances to be made by the Servicer for any
Remittance Date shall equal, subject to Section 4.01(c), the sum of (i) with
respect to the Mortgage Loans, the aggregate amount of Scheduled Payments (with
each interest portion thereof net of the related Servicing Fee), due on the Due
Date immediately preceding such Remittance Date in respect of such Mortgage
Loans, which Scheduled Payments were not received as of the related
Determination Date, plus (ii) with respect to each REO Property, which REO
Property was acquired during or prior to the related Prepayment Period and as to
which such REO Property an REO Disposition did not occur during the related
Prepayment Period, an amount equal to the excess, if any, of the Scheduled
Payments (with each interest portion thereof net of the related Servicing Fee)
that would have been due on the related Due Date in respect of the related
Mortgage Loans, over the net income from such REO Property transferred to the
Collection Account for distribution on such Remittance Date.
(b) On the Remittance Date, the Servicer shall remit in immediately
available funds to the Master Servicer an amount equal to the aggregate amount
of P&I Advances, if any, to be made in respect of the Mortgage Loans and REO
Properties serviced by the Servicer for the related Remittance Date either (i)
from its own funds, (ii) from the Collection Account, to the extent of funds
held therein for future distribution (in which case, it will cause to be made an
appropriate entry in the records of the Collection Account that Amounts Held for
Future Distribution have been, as permitted by this Section 4.01, used by the
Servicer in discharge of any such P&I Advance) or (iii) in the form of any
combination of (i) and (ii) aggregating the
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total amount of P&I Advances to be made by the Servicer with respect to the
Mortgage Loans and REO Properties. Any Amounts Held For future Distribution and
so used shall be appropriately reflected in the Servicer's records and replaced
by the Servicer by deposit in the Collection Account on or before any future
Remittance Date to the extent required.
(c) The obligation of the Servicer to make such P&I Advances is
mandatory, notwithstanding any other provision of this Agreement but subject to
paragraph (d) below, and, with respect to any Mortgage Loan or REO Property,
shall continue until a Final Recovery Determination in connection therewith or
the removal thereof from coverage under this Agreement, except as otherwise
provided in this Section.
(d) Notwithstanding anything herein to the contrary, no P&I Advance or
Servicing Advance shall be required to be made hereunder by the Servicer if such
P&I Advance or Servicing Advance would, if made, constitute a Nonrecoverable P&I
Advance or Nonrecoverable Servicing Advance. The Servicer may determine at any
time that an Advance made constitutes a Nonrecoverable P&I Advance or a
Nonrecoverable Servicing Advance, as applicable. The determination by the
Servicer that it has made a Nonrecoverable P&I Advance or a Nonrecoverable
Servicing Advance or that any proposed P&I Advance or Servicing Advance, if
made, would constitute a Nonrecoverable P&I Advance or a Nonrecoverable
Servicing Advance, respectively, shall be evidenced by an Officers' Certificate
of the Servicer delivered to the Securities Administrator and Master Servicer.
(e) The Servicer shall be entitled to reimbursement for P&I Advances
and Servicing Advances as and to the extent set forth in Section 3.11.
(f) On each Remittance Date, the Master Servicer shall deposit all
funds remitted to it by the Servicer pursuant to Sections 3.11(a)(i) and 3.25
and this Section 4.01 in a segregated Eligible Account for the benefit of the
Certificateholders and, prior to each Distribution Date, will remit such amounts
to the Securities Administrator for deposit in the Distribution Account. The
Master Servicer may retain or withdraw from the Distribution Account, (i) the
Securities Administrator and Master Servicer Fee, (ii) amounts necessary to
reimburse it for any previously unreimbursed Advances and any Advances the
Master Servicer deems to be nonrecoverable from the related Mortgage Loan
proceeds, (iii) an amount to indemnify itself for amounts due in accordance with
this Agreement, and (iv) any other amounts that it is entitled to receive
hereunder for reimbursement, indemnification or otherwise. The amounts remitted
by the Servicer to the Master Servicer on the Servicer Remittance Date shall be
credited to the Master Servicing Account within 2 Business Days once the amounts
are identified as a remittance in connection with the trust and reconciled to
the reports provided by the Servicer.
Section 4.02 Priorities of Distribution.
(a) On each Distribution Date, the Securities Administrator shall,
solely in accordance with the information provided by the Master Servicer,
allocate from amounts then on deposit in the Distribution Account in the
following order of priority and to the extent of the Available Funds remaining:
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(i) to the Holders of each class of LIBOR Certificates and the
Swap Account in the following order of priority:
(A) to the Swap Account, first, from the Interest Remittance Amount
and, second from the Principal Remittance Amount, the sum of (x)
all Net Swap Payments and (y) any Swap Termination Payment owed
to the Swap Provider other than a Defaulted Swap Termination
Payment owed to the Swap Provider, if any;
(B) from the Interest Remittance Amount, after taking into account
payment to the Swap Account pursuant to Section 4.02(a)(i)(A), in
the following order of priority:
(1) concurrently, to the holders of the Class A Certificates,
pro rata, based on their respective Class Certificate
Balances, the Accrued Certificate Interest and any Unpaid
Interest Amount for each class of Class A Certificates;
(2) payable from any remaining Interest Remittance Amount, to
the Class M-1 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date;
(3) payable from any remaining Interest Remittance Amount, to
the Class M-2 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date;
(4) payable from any remaining Interest Remittance Amount, to
the Class M-3 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date;
(5) payable from any remaining Interest Remittance Amount, to
the Class M-4 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date;
(6) payable from any remaining Interest Remittance Amount, to
the Class M-5 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date;
(7) payable from any remaining Interest Remittance Amount, to
the Class M-6 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date;
(8) payable from any remaining Interest Remittance Amount, to
the Class B-1 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date;
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(9) payable from any remaining Interest Remittance Amount, to
the Class B-2 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date;
(10) payable from any remaining Interest Remittance Amount, to
the Class B-3 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date; and
(11) payable from any remaining Interest Remittance Amount, to
the Class B-4 Certificates, the Accrued Certificate Interest
for such Class on such Distribution Date.
(ii) (x) on each Distribution Date (A) before the Stepdown Date
or (B) with respect to which a Trigger Event is in effect, to the Holders
of the Class or Classes of LIBOR Certificates then entitled to
distributions of principal as set forth below from the amounts remaining on
deposit in the Distribution Account after making distributions pursuant to
clause (i) above, in an amount equal to the Principal Distribution Amount
in the following order of priority:
(A) to the Holders of the Class A Certificates, first, to the Class
A-1 Certificates until the Certificate Balance of the Class A-1
Certificates has been reduced to zero, second, to the Class A-2
Certificates until the Certificate Balance of the Class A-2
Certificates has been reduced to zero, third, to the Class A-3
Certificates until the Certificate Balance of the Class A-3
Certificates has been reduced to zero and fourth, to the Class
A-4 Certificates until the Certificate Principal Balance of the
Class A-4 Certificates has been reduced to zero; provided,
however, that on and after the Distribution Date on which the
aggregate Class Certificate Balances of the Subordinated
Certificates and the principal balance of the Class X
Certificates have been reduced to zero, any principal
distributions allocated to the Class A Certificates shall be
allocated pro rata among the Class A-1, Class A-2, Class A-3 and
Class A-4 Certificates, based on their respective Class
Certificate Balances, and distributed concurrently to the Class
A-1, Class A-2, Class A-3 and Class A-4 Certificates;
(B) sequentially to the Class X-0, Xxxxx X-0, Class M-3, Class M-4,
Class M-5, Class M-6, Class B-1, Class B-2, Class B-3 and Class
B-4 Certificates, in that order, until the respective Class
Certificate Balances are reduced to zero;
(y) on each Distribution Date (1) on and after the Stepdown Date
and (2) as long as a Trigger Event is not in effect, to the Holders of the
related Class or Classes of LIBOR Certificates then entitled to
distribution of principal from amounts remaining on deposit in the
Distribution Account after making distributions pursuant to clause (i)
above, in an amount equal to, in the aggregate, the Principal Distribution
Amount in the following amounts and order of priority:
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(A) to the Class A Certificates, the lesser of the Principal
Distribution Amount and the Class A Principal Distribution
Amount, allocated among the Class A Certificates, first, to the
Class A-1 Certificates until the Certificate Balance of the Class
A-1 Certificates has been reduced to zero, second, to the Class
A-2 Certificates until the Certificate Balance of the Class A-2
Certificates has been reduced to zero, third, to the Class A-3
Certificates until the Certificate Balance of the Class A-3
Certificates has been reduced to zero and fourth, to the Class
A-4 Certificates until the Certificate Balance of the Class A-4
Certificates has been reduced to zero; provided, however, that on
and after the Distribution Date on which the aggregate Class
Certificate Balances of the Subordinated Certificates and the
principal balance of the Class X Certificates have been reduced
to zero, any principal distributions allocated to the Class A
Certificates shall be allocated pro rata among the Class A-1,
Class A-2, Class A-3 and Class A-4 Certificates, based on their
respective Class Certificate Balances, and distributed
concurrently to the Class A-1, Class A-2, Class A-3 and Class A-4
Certificates;
(B) to the Class M-1 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class M-1 Principal
Distribution Amount, until the Class Certificate Balance thereof
has been reduced to zero;
(C) to the Class M-2 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class M-2 Principal
Distribution Amount, until the Class Certificate Balance thereof
has been reduced to zero;
(D) to the Class M-3 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class M-3 Principal
Distribution Amount, until the Class Certificate Balance thereof
has been reduced to zero;
(E) to the Class M-4 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class M-4 Principal
Distribution Amount, until the Class Certificate Balance thereof
has been reduced to zero;
(F) to the Class M-5 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class M-5 Principal
Distribution Amount, until the Class Certificate Balance thereof
has been reduced to zero;
(G) to the Class M-6 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class M-6 Principal
Distribution Amount, until the Class Certificate Balance thereof
has been reduced to zero;
(H) to the Class B-1 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class B-1 Principal
Distribution Amount, until the Class Certificate Balance thereof
has been reduced to zero;
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(I) to the Class B-2 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class B-2 Principal
Distribution Amount, until the Class Certificate Balance thereof
has been reduced to zero;
(J) to the Class B-3 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class B-3 Principal
Distribution Amount, until the Class Certificate Balance thereof
has been reduced to zero; and
(K) to the Class B-4 Certificates, the lesser of the remaining
Principal Distribution Amount and the Class B-4 Principal
Distribution Amount, until the Class Certificate Balance thereof
has been reduced to zero;
(iii) any amount remaining in the Distribution Account after the
distributions in clauses (i) and (ii) above, plus as specifically indicated
below, from amounts on deposit in the Excess Reserve Fund Account, shall be
distributed in the following order of priority:
(A) to the Holders of the Class M-1 Certificates, any Unpaid Interest
Amount for such Class;
(B) to the Holders of the Class M-1 Certificates, any Unpaid Realized
Loss Amount for such Class;
(C) to the Holders of the Class M-2 Certificates, any Unpaid Interest
Amount for such Class;
(D) to the Holders of the Class M-2 Certificates, any Unpaid Realized
Loss Amount for such Class;
(E) to the Holders of the Class M-3 Certificates, any Unpaid Interest
Amount for such Class;
(F) to the Holders of the Class M-3 Certificates, any Unpaid Realized
Loss Amount for such Class;
(G) to the Holders of the Class M-4 Certificates, any Unpaid Interest
Amount for such Class;
(H) to the Holders of the Class M-4 Certificates, any Unpaid Realized
Loss Amount for such Class;
(I) to the Holders of the Class M-5 Certificates, any Unpaid Interest
Amount for such Class;
(J) to the Holders of the Class M-5 Certificates, any Unpaid Realized
Loss Amount for such Class;
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(K) to the Holders of the Class M-6 Certificates, any Unpaid Interest
Amount for such Class;
(L) to the Holders of the Class M-6 Certificates, any Unpaid Realized
Loss Amount for such Class;
(M) to the Holders of the Class B-1 Certificates, any Unpaid Interest
Amount for such Class;
(N) to the Holders of the Class B-1 Certificates, any Unpaid Realized
Loss Amount for such Class;
(O) to the Holders of the Class B-2 Certificates, any Unpaid Interest
Amount for such Class;
(P) to the Holders of the Class B-2 Certificates, any Unpaid Realized
Loss Amount for such Class;
(Q) to the Holders of the Class B-3 Certificates, any Unpaid Interest
Amount for such Class;
(R) to the Holders of the Class B-3 Certificates, any Unpaid Realized
Loss Amount for such Class;
(S) to the Holders of the Class B-4 Certificates, any Unpaid Interest
Amount for such Class;
(T) to the Holders of the Class B-4 Certificates, any Unpaid Realized
Loss Amount for such Class;
(U) to the Excess Reserve Fund Account, the amount of any Basis Risk
Payment for such Distribution Date;
(V) from any Interest Rate Cap Payment on deposit in the Excess
Reserve Fund Account with respect to that Distribution Date, an
amount equal to any unpaid Basis Risk Carry Forward Amount with
respect to the LIBOR Certificates for that Distribution Date,
allocated first, among those Classes of Certificates, pro rata,
based upon their respective Class Certificate Balances, and
second, any remaining amounts allocated among those Classes of
Certificates, pro rata, based on any Basis Risk Carry Forward
Amounts remaining unpaid, in order to reimburse such unpaid
amounts;
(W) from amounts on deposit in the Excess Reserve Fund Account (not
including any Interest Rate Cap Payment on deposit therein), an
amount equal to any unpaid Basis Risk Carry Forward Amount, prior
to application of any amounts on deposit in the Swap Account
(after taking into account any payments made pursuant to Section
4.02(a)(iii)(V) above), with respect to any LIBOR Certificates
allocated to the LIBOR
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Certificates in the same order and priority in which Accrued
Certificate Interest is allocated among those Classes of
Certificates, with the allocation to the Class A Certificates
being further allocated: first, between the Class A-1, Class A-2,
Class A-3 and Class A-4 Certificates pro rata, based upon their
respective Class Certificate Balances and second, any remaining
amounts to the Class A-1, Class A-2, Class A-3 and Class A-4
Certificates, pro rata, based on any Basis Risk Carry Forward
Amounts remaining unpaid, in order to reimburse such unpaid
amounts;
(X) to the Swap Account, the amount of any Defaulted Swap Termination
Payment owed to the Swap Provider;
(Y) to the Holders of the Class P Certificates (as a payment from
REMIC V to the Class X Certificates), the outstanding principal
balance thereof, if any, and to the Holders of the Class X
Certificates, the remainder of the Class X Distributable Amount
not distributed pursuant to Sections 4.02(a)(iii)(A)-(X) (to the
extent stated in clause (i) of the definition of Class X
Distributable Amount, as interest, and to the extent stated in
clause (ii) of the definition of Class X Distributable Amount, as
principal); and
(Z) to the Holders of the Class R Certificates, any remaining amount.
(b) On each Distribution Date prior to any distributions on any other
Class of Certificates, all amounts representing Prepayment Charges from the
Mortgage Loans received during the related Prepayment Period shall be
distributed by the Securities Administrator to the Holders of the Class P
Certificates.
(c) On the February 2007 and March 2007 Distribution Dates and on
April 24, 2007, the Securities Administrator shall transfer from the Capitalized
Interest Account to the Distribution Account the Capitalized Interest
Requirement, if any, for such Distribution Date.
(d) On either the Distribution Date following the final Subsequent
Transfer Date or April 24, 2007, whichever date is earlier, any amounts
remaining in the Capitalized Interest Account and all Pre-Funding Earnings in
the Pre-Funding Account, after taking into account the transfers in respect of
the Distribution Date described in clause (c) above, shall be paid by the
Securities Administrator to the Unaffiliated Seller.
(e) On each Subsequent Transfer Date, the Unaffiliated Seller shall
instruct in writing the Securities Administrator to withdraw from the
Pre-Funding Account an amount equal to 100% of the aggregate Stated Principal
Balances as of the related Subsequent Cut-off Date of the Subsequent Mortgage
Loans sold to the Trust Fund on such Subsequent Transfer Date and pay such
amount to or upon the order of the Unaffiliated Seller upon satisfaction of the
conditions set forth in Section 2.01(c) with respect to such transfer. The
Securities Administrator may conclusively rely on such written instructions from
the Unaffiliated Seller.
(f) If the Pre-Funding Amount available in the Pre-Funding Account
(exclusive of Pre-Funding Earnings) has been reduced to $100,000 or less by the
close of
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business on March 24, 2007 then, on the March 25, 2007 Distribution Date, after
giving effect to any reductions in such Pre-Funding Amount on such date, the
Securities Administrator shall withdraw from the Pre-Funding Account on such
date and deposit in the Distribution Account the amount on deposit in such
Pre-Funding Account other than any Pre-Funding Earnings; if the Pre-Funding
Amount available in such Pre-Funding Account has not been reduced to zero by the
close of business on April 24, 2007, the Securities Administrator shall withdraw
from such Pre-Funding Account the amount on deposit therein, other than the
Pre-Funding Earnings, and deposit such amount into the Distribution Account on
such day for distribution on the April 25, 2007 Distribution Date into the
Distribution Account. Any amount deposited into the Distribution Account
pursuant to the preceding sentence from the Pre-Funding Account shall be
distributed to the Class A Certificates until those Certificates are reduced to
zero; provided that amounts allocated to the Class A Certificates shall be
allocated as follows: first, to the Class A-1 Certificates until the Certificate
Balance of the Class A-1 Certificates has been reduced to zero, second, to the
Class A-2 Certificates until the Certificate Balance of the Class A-2
Certificates has been reduced to zero, and third, to the Class A-3 Certificates
until the Certificate Balance of the Class A-3 Certificates has been reduced to
zero, as a separate payment of principal, on the related Distribution Date.
(g) On any Distribution Date, any Relief Act Shortfalls and Net
Prepayment Interest Shortfalls for such Distribution Date shall be allocated by
the Securities Administrator as a reduction in the following order:
(1) first, to the amount of interest payable to the Class X
Certificates; and
(2) second, pro rata, as a reduction of the Accrued Certificate
Interest for the Class A-1, Class A-2, Class X-0, Xxxxx X-0, Class M-1,
Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class B-1, Class
B-2, Class B-3 and Class B-4 Certificates, based on the amount of interest
to which such Classes would otherwise be entitled.
(h) On any Distribution Date any funds on deposit in the Swap Account
shall be distributed in the following order of priority:
(i) to the Swap Provider, all Net Swap Payments, if any, owed to the
Swap Provider for that Distribution Date;
(ii) to the Swap Provider, any Swap Termination Payment, including,
without limitation, any Senior Defaulted Swap Termination Payment but not
including any other Defaulted Swap Termination Payment, if any, owed to the
Swap Provider for that Distribution Date;
(iii) to the Class A Certificates, to pay Accrued Certificate Interest
and, if applicable, any Unpaid Interest Amounts to the extent unpaid from
Available Funds;
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(iv) sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class M-4,
Class M-5, Class M-6, Class B-1, Class B-2, Class B-3 and Class B-4, in
that order to pay to pay Accrued Certificate Interest and, if applicable,
any Unpaid Interest Amounts the extent unpaid from Available Funds;
(v) to the LIBOR Certificates, to pay principal but only to the extent
necessary to restore the Subordinated Amount to the Specified Subordinated
Amount as a result of prior or current Realized Losses not previously
reimbursed, after giving effect to payments and distributions from
Available Funds;
(vi) to the Class A certificates, to pay any Basis Risk Carry Forward
Amounts, pro rata, based on their Class Certificate Balances for such
Distribution Date, up to the Swap Payment Allocation for each class of
Class A certificates and to the extent unpaid from Available Funds
(including funds on deposit in the Excess Reserve Fund Account);
(vii) sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class M-4,
Class M-5, Class M-6, Class B-1, Class B-2, Class B-3 and Class B-4
certificates, to pay any Basis Risk Carry Forward Amounts, up to the Swap
Payment Allocation for each class of Class M and Class B certificates and
to the extent unpaid from Available Funds (including funds on deposit in
the Excess Reserve Fund Account);
(viii) to the LIBOR Certificates, any remaining unpaid Basis Risk
Carry Forward Amount, pro rata, based on their respective remaining unpaid
Basis Risk Carry Forward Amount after the allocation of payments as set
forth in clauses (vi) and (vii) above;
(ix) sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class M-4,
Class M-5, Class M-6, Class B-1, Class B-2, Class B-3 and Class B-4
certificates, to pay any Unpaid Realized Loss Amounts, to the extent unpaid
from Available Funds;
(x) to the Swap Provider, any Defaulted Swap Termination Payment other
than a Senior Defaulted Swap Termination Payment owed to the Swap Provider
for that Distribution Date; and
(xi) to the holders of the Class X certificates, any remaining
amounts.
(i) Following the applicable Final Scheduled Distribution Date, no
Class of Certificates other than the Class R Certificates shall be entitled to
receive any remaining amounts. Any amounts remaining in any of the Accounts
shall be applied (i) to the Securities Administrator, the Master Servicer and
the Servicer pro rata to the extent of any remaining
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unpaid amounts then owed to them, and then (ii) to the Class R Certificates, any
remaining amount.
Section 4.03 Monthly Statements to Certificateholders.
(a) Not later than each Distribution Date, the Securities
Administrator shall make available to each Certificateholder, the Servicer, the
Depositor, the Unaffiliated Seller, the Trustee, the Master Servicer, the Swap
Provider, the Cap Provider and each Rating Agency a statement (the "Monthly
Statement"), based solely on the information provided by the Master Servicer two
Business Days prior to the Distribution Date, setting forth with respect to the
related distribution:
(i) the amount thereof allocable to principal, separately identifying
the aggregate amount of any Principal Prepayments and Liquidation Proceeds
included therein;
(ii) the amount thereof allocable to interest, any Unpaid Interest
Amounts included in such distribution and any remaining Unpaid Interest
Amounts after giving effect to such distribution, any Basis Risk Carry
Forward Amount for such Distribution Date and the amount of all Basis Risk
Carry Forward Amount covered by withdrawals from the Excess Reserve Fund
Account on such Distribution Date;
(iii) if the distribution to the Holders of such Class of Certificates
is less than the full amount that would be distributable to such Holders if
there were sufficient funds available therefor, the amount of the shortfall
and the allocation thereof as between principal and interest, including any
Basis Risk Carry Forward Amount not covered by amounts in the Excess
Reserve Fund Account;
(iv) the Class Certificate Balance of each Class of Certificates after
giving effect to the distribution of principal on such Distribution Date;
(v) the Pool Stated Principal Balance for the following Distribution
Date;
(vi) the amount of the Expense Fees (stated separately and in the
aggregate) paid to or retained by (i) the Servicer with respect to such
Distribution Date and (ii) the Master Servicer and the Securities
Administrator;
(vii) the Pass-Through Rate for each such Class of Certificates with
respect to such Distribution Date;
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(viii) the amount of Advances included in the distribution on such
Distribution Date and the aggregate amount of Advances reported by the
Servicer and the Master Servicer as outstanding as of the close of business
on such Distribution Date;
(ix) the number and aggregate Scheduled Principal Balances of Mortgage
Loans (1) as to which the Scheduled Payment is Delinquent 31 to 60 days, 61
to 90 days and 91 or more days, (2) that have become REO Property, (3) that
are in foreclosure and (4) that are in bankruptcy, in each case as of the
close of business on the last Business Day of the immediately preceding
calendar month as reported in the OTS methodology;
(x) with respect to any Mortgage Loan that became an REO Property
during the preceding calendar month, the loan number and Stated Principal
Balance of such Mortgage Loan as of the close of business on the last
Business Day of the immediately preceding calendar month and the date of
acquisition thereof;
(xi) the total number and aggregate principal balance of any REO
Properties (and market value, if available) as of the close of business on
the last Business Day of the immediately preceding month;
(xii) whether a Trigger Event has occurred and is continuing
(including the calculation of thereof and the aggregate outstanding balance
of all 60+ Day Delinquent Loans);
(xiii) the amount on deposit in the Excess Reserve Fund Account (after
giving effect to distributions on such Distribution Date);
(xiv) for each Class of Certificates, the amount of Applied Realized
Loss Amounts incurred during the preceding calendar month and aggregate
Applied Realized Loss Amounts through such Distribution Date;
(xv) the aggregate amount of Subsequent Recoveries incurred during the
preceding calendar month and aggregate Subsequent Recoveries through such
Distribution Date;
(xvi) the amount of any Net Monthly Excess Cash Flow on such
Distribution Date and the allocation thereof to the Certificateholders with
respect to Applied Realized Loss Amounts and Unpaid Interest Amounts;
(xvii) the Subordinated Amount and Specified Subordinated Amount;
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(xviii) the Interest Remittance Amount, the Principal Remittance
Amount and the Prepayment Charges remitted by the Servicer with respect to
that Distribution Date;
(xix) the Pre-Funded Amount as of the end of the prior Due Period;
(xx) the amount of any principal prepayment on the Certificates
resulting from the application of unused moneys in the Pre-Funding Account;
(xxi) the Net Swap Payment or Net Swap Receipt, as applicable, or any
Defaulted Swap Termination Payment, if any, for such Distribution Date; and
(xxii) any Interest Rate Cap Payments for such Distribution Date.
In addition, each Form 10-D prepared and filed by the Securities Administrator
pursuant to Section 8.12 shall include the following information with respect to
the related distribution:
(i) material breaches of Mortgage Loan representations and warranties of
which the Securities Administrator has received written instruction to
include in the Form 10-D; and
(ii) material breaches of any covenants under this Agreement of which the
Securities Administrator has received written instruction to include in the
Form 10-D.
(b) The Securities Administrator's responsibility for providing the
above statement is limited to the availability, timeliness and accuracy of the
information derived from the Master Servicer. The Master Servicer's
responsibility for providing the above information is limited to the
availability, timeliness and accuracy of the information provided to the Master
Servicer by the Servicer in the Servicer Remittance Reports upon which the
Master Servicer's information provided to the Securities Administrator shall be
based. The Securities Administrator will provide the above statement via the
Securities Administrator's internet website. The Securities Administrator's
website will initially be located at xxx.XXXXxxx.xxx and assistance in using the
website can be obtained by calling the Securities Administrator's investor
relations desk at 0-000-000-0000. A paper copy of the statement will also be
made available upon written request. Upon timely and adequate prior notice to
the Depositor and each Certificateholder, the Securities Administrator may
change the manner in which statements are distributed in order to make such
distributions more convenient and or more accessible to the Depositor and each
Certificateholder.
The Securities Administrator shall make available to each Analytics
Company via its website each statement to Certificateholders prepared pursuant
to Section 4.03(a). The Securities Administrator, the Master Servicer and the
Servicer shall cooperate in good faith with the Depositor to reconcile any
discrepancies in such statements, and the Securities Administrator
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shall provide any corrections to such statements to each Analytics Company as
soon as reasonably practicable after the such discrepancies have been identified
and resolved.
The Securities Administrator will also be entitled to rely on but
shall not be responsible for the content or accuracy of any information provided
by third parties for purposes of preparing the monthly statement to
Certificateholders and may affix thereto any disclaimer it deems appropriate in
its reasonable discretion (without suggesting liability on the part of any other
party hereto).
(c) Within a reasonable period of time after the end of each calendar
year, the Securities Administrator shall cause to be made available to each
Person who at any time during the calendar year was a Certificateholder, a
statement containing the information set forth in clauses (a)(i) and (a)(ii) of
this Section 4.03 aggregated for such calendar year or applicable portion
thereof during which such Person was a Certificateholder. Such obligation of the
Securities Administrator shall be deemed to have been satisfied to the extent
that substantially comparable information shall have been previously provided by
the Securities Administrator.
Not later than the 18th day of each month (or if such day is a
Saturday, the prior Business Day and if such day is a Sunday or otherwise not a
Business Day, prior to, the following Business Day), the Servicer shall furnish
to Depositor with respect to clause (i) below and the Master Servicer and the
Swap Provider with respect to clause (ii) below, a monthly remittance advice
statement (the "Servicer Remittance Report") (in a format mutually agreed upon
by the Servicer, the Master Servicer and the Depositor) and including the
information as provided in Exhibit X hereto, containing such information as
shall be reasonably requested (i) by the Depositor to enable the Depositor to
disclose "static pool information", as required by Item 1105 of Regulation AB,
with respect to the Mortgage Loans, and (ii) by the Securities Administrator
(and including the information as provided in Exhibit X hereto) to enable the
Securities Administrator to provide the reports required by Section 4.03(a) as
to the accompanying remittance and the period ending on the close of business on
the last day of the preceding month. The Servicer shall deliver to the Depositor
a data tape containing a supplemental report of principal prepayment made during
such period, in form and substance reasonably satisfactory to the Depositor,
containing the information required pursuant to this Section 4.03(d) on a
loan-by-loan basis for all of the Mortgage Loans.
Not later than the 18th day of each month (or if such day is a
Saturday, the prior Business Day and if such day is a Sunday or otherwise not a
Business Day, prior to, the following Business Day), the Servicer shall furnish,
subject to the terms of the confidentiality agreement between the Servicer and
the Unaffiliated Seller, the Unaffiliated Seller, an individual loan accounting
report, which may be the same as the Servicer Remittance Report described in the
previous paragraph, as of the Determination Date of each month to document
Mortgage Loan payment activity on an individual Mortgage Loan basis. The
corresponding individual loan accounting report (in electronic format) shall
contain the following:
(i) with respect to each Scheduled Payment, the amount of such
remittance allocable to principal (including a separate breakdown of any
Principal Prepayment);
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(ii) with respect to each Scheduled Payment, the amount of such
remittance allocable to interest and assumption fees;
(iii) the amount of servicing compensation received by the Servicer
during the related distribution period;
(iv) the individual and aggregate Stated Principal Balance of the
Mortgage Loans;
(v) the individual and aggregate Scheduled Principal Balances of the
Mortgage Loans;
(vi) the aggregate of any expenses reimbursed to the Servicer during
the prior distribution period pursuant to Section 3.05 and 3.11;
(vii) the number and aggregate Scheduled Principal Balances of
Mortgage Loans (a) as to which the Scheduled Payment is Delinquent (1) 31
to 60 days, (2) 61 to 90 days and (3) 91 days or more; (b) as to which
foreclosure has commenced; (c) as to which REO Property has been acquired
and (d) that are in bankruptcy.
Section 4.04 Certain Matters Relating to the Determination of LIBOR.
LIBOR shall be calculated by the Securities Administrator in
accordance with the definition of LIBOR. Until all of the LIBOR Certificates are
paid in full, the Securities Administrator will at all times retain at least
four Reference Banks for the purpose of determining LIBOR with respect to each
LIBOR Determination Date. The Securities Administrator, after consultation with
the Depositor, initially shall designate the Reference Banks. Each "Reference
Bank" shall be a leading bank engaged in transactions in Eurodollar deposits in
the international Eurocurrency market, shall not control, be controlled by, or
be under common control with, the Securities Administrator and shall have an
established place of business in London. If any such Reference Bank should be
unwilling or unable to act as such or if the Securities Administrator should
terminate a Reference Bank, the Securities Administrator, after consultation
with the Depositor, shall promptly appoint or cause to be appointed another
Reference Bank. The Securities Administrator shall have no liability or
responsibility to any Person for (i) the selection of any Reference Bank for
purposes of determining LIBOR or (ii) any inability to retain at least four
Reference Banks which is caused by circumstances beyond its reasonable control.
The Pass-Through Rate for each Class of LIBOR Certificates for each
Interest Accrual Period shall be determined by the Securities Administrator on
each LIBOR Determination Date so long as the LIBOR Certificates are outstanding
on the basis of LIBOR and the respective formulae appearing in footnotes
corresponding to the LIBOR Certificates in the table relating to the
Certificates in the Preliminary Statement. The Securities Administrator
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shall not have any liability or responsibility to any Person for its inability,
following a good-faith reasonable effort, to obtain quotations from the
Reference Banks or to determine the arithmetic mean referred to in the
definition of LIBOR, all as provided for in this Section 4.04 and the definition
of LIBOR. The establishment of LIBOR and each Pass-Through Rate for the LIBOR
Certificates by the Securities Administrator shall (in the absence of manifest
error) be final, conclusive and binding upon each Holder of a Certificate and
the Securities Administrator.
Section 4.05 [Reserved]
Section 4.06 [Reserved]
Section 4.07 Allocation of Applied Realized Loss Amounts.
Any Applied Realized Loss Amounts shall be allocated by the Securities
Administrator to the most junior Class of Subordinated Certificates then
outstanding in reduction of the Class Certificate Balance thereof.
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates.
The Certificates shall be substantially in the forms attached hereto
as exhibits. The Certificates shall be issuable in registered form, in the
minimum denominations, integral multiples in excess thereof (except that one
Certificate in each Class may be issued in a different amount and aggregate
denominations per Class set forth in the Preliminary Statement).
The Depositor hereby directs the Securities Administrator to register
the Class X Certificates and the Class P Certificates initially to Xxxxx Fargo
Bank, National Association, as indenture trustee on behalf of the Noteholders of
the IXIS Real Estate Capital Inc. NIM 2007-HE1N Notes, and to deliver such Class
X Certificates and Class P Certificates on the Closing Date to Xxxxx Fargo Bank
National Association, or as otherwise directed by the Depositor.
Subject to Section 11.02 respecting the final distribution on the
Certificates, on each Distribution Date the Securities Administrator shall make
distributions to each Certificateholder of record on the preceding Record Date
(x) by wire transfer in immediately available funds to the account of such
holder at a bank or other entity having appropriate facilities therefor, or (y)
upon the request, in writing, of the applicable Certificateholder, by check
mailed by first class mail to such Certificateholder at the address of such
holder appearing in the Certificate Register.
The Certificates shall be executed by manual or facsimile signature on
behalf of the Trustee by an authorized officer and authenticated by the
Securities Administrator by manual or facsimile signature by an authorized
officer. Certificates bearing the manual or facsimile signatures of individuals
who were, at the time such signatures were affixed, authorized to sign on behalf
of the Trustee or Securities Administrator, respectively, shall bind the Trustee
and the Securities Administrator, respectively, notwithstanding that such
individuals or any of them have
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ceased to be so authorized prior to the execution, authentication and delivery
of any such Certificates or did not hold such offices at the date of such
Certificate. No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless authenticated by the Securities
Administrator by manual signature, and such authentication upon any Certificate
shall be conclusive evidence, and the only evidence, that such Certificate has
been duly executed and delivered hereunder. All Certificates shall be dated the
date of their authentication. On the Closing Date, the Securities Administrator
shall authenticate the Certificates to be issued at the direction of the
Depositor, or any affiliate thereof.
Section 5.02 Certificate Register; Registration of Transfer and
Exchange of Certificates.
(a) The Securities Administrator, on behalf of the Trustee, shall
maintain, or cause to be maintained in accordance with the provisions of Section
5.06, a Certificate Register for the Trust Fund in which, subject to the
provisions of subsections (b) and (c) below and to such reasonable regulations
as it may prescribe, the Securities Administrator shall provide for the
registration of Certificates and of transfers and exchanges of Certificates as
herein provided. Upon surrender for registration of transfer of any Certificate,
the Securities Administrator shall execute and deliver, in the name of the
designated transferee or transferees, one or more new Certificates of the same
Class and aggregate Percentage Interest.
At the option of a Certificateholder, Certificates may be exchanged
for other Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest upon surrender of the
Certificates to be exchanged at the office or agency of the Securities
Administrator. Whenever any Certificates are so surrendered for exchange, the
Securities Administrator shall execute, authenticate, and deliver the
Certificates which the Certificateholder making the exchange is entitled to
receive. Every Certificate presented or surrendered for registration of transfer
or exchange shall be accompanied by a written instrument of transfer in form
satisfactory to the Securities Administrator duly executed by the holder thereof
or his attorney duly authorized in writing.
No service charge to the Certificateholders shall be made for any
registration of transfer or exchange of Certificates, but payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates may be required.
All Certificates surrendered for registration of transfer or exchange
shall be cancelled and subsequently destroyed by the Securities Administrator in
accordance with the Securities Administrator's customary procedures.
(b) No transfer of a Private Certificate shall be made unless such
transfer is made pursuant to an effective registration statement under the
Securities Act and any applicable state securities laws or is exempt from the
registration requirements under said Act and such state securities laws. Except
with respect to (i) the transfer of Class X, Class P or Class R Certificates to
the Depositor or an Affiliate of the Depositor, (ii) the transfer of the Class X
and Class P Certificates to the NIM Issuer, if any, or the NIM Trustee, if any,
or (iii) a transfer of the Class X or Class P Certificates from the NIM Issuer,
if any, or the NIM Trustee, if any, to the
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Depositor, Unaffiliated Seller or an Affiliate of the Depositor or the
Unaffiliated Seller, in the event that a transfer of a Private Certificate which
is a Physical Certificate is to be made in reliance upon an exemption from the
Securities Act and such laws, in order to assure compliance with the Securities
Act and such laws, the Certificateholder desiring to effect such transfer shall
certify to the Securities Administrator in writing the facts surrounding the
transfer in substantially the form set forth in Exhibit I (the "Transferor
Certificate") and either (i) there shall be delivered to the Securities
Administrator a letter in substantially the form of Exhibit J (the "Rule 144A
Letter") or (ii) there shall be delivered to the Securities Administrator at the
expense of the transferor an Opinion of Counsel that such transfer may be made
without registration under the Securities Act. In the event that a transfer of a
Private Certificate which is a Book-Entry Certificate is to be made in reliance
upon an exemption from the Securities Act and such laws, in order to assure
compliance with the Securities Act and such laws, the Certificateholder desiring
to effect such transfer will be deemed to have made as of the transfer date each
of the certifications set forth in the Transferor Certificate in respect of such
Certificate and the transferee will be deemed to have made as of the transfer
date each of the certifications set forth in the Rule 144A Letter in respect of
such Certificate, in each case as if such Certificate were evidenced by a
Physical Certificate. The Depositor shall, and the Unaffiliated Seller may,
provide to any Holder of a Private Certificate and any prospective transferee
designated by any such Holder, information regarding the related Certificates
and the Mortgage Loans and such other information as shall be necessary to
satisfy the condition to eligibility set forth in Rule 144A(d)(4) for transfer
of any such Certificate without registration thereof under the Securities Act
pursuant to the registration exemption provided by Rule 144A. The Trustee, the
Securities Administrator, the Master Servicer and the Servicer shall cooperate
with the Depositor and the Unaffiliated Seller in providing the Rule 144A
information referenced in the preceding sentence, including providing to the
Depositor such information regarding the Certificates, the Mortgage Loans and
other matters regarding the Trust Fund as the Depositor and the Unaffiliated
Seller shall reasonably request to meet its obligation under the preceding
sentence. Each Holder of a Private Certificate desiring to effect such transfer
shall, and does hereby agree to, indemnify the Trustee, the Securities
Administrator, the Depositor, the Servicer, the Master Servicer and the
Unaffiliated Seller against any liability that may result if the transfer is not
so exempt or is not made in accordance with such federal and state laws.
Except with respect to (i) the transfer of Class X, Class P or Class R
Certificates to the Depositor or an Affiliate of the Depositor, (ii) a transfer
of the Class X and Class P Certificates to the NIM Issuer, if any, or the NIM
Trustee, if any, or (iii) a transfer of the Class X or Class P Certificates from
the NIM Issuer, if any, or the NIM Trustee, if any, to the Depositor,
Unaffiliated Seller or an Affiliate of the Depositor or the Unaffiliated Seller,
no transfer of an ERISA-Restricted Certificate shall be made unless the
Securities Administrator shall have received a representation letter from the
transferee in substantially the form of Exhibit J, to the effect that either (A)
such transferee is not an employee benefit plan or arrangement subject to Title
I of ERISA, Section 4975 of the Code or any Federal, state or local law
materially similar to the foregoing provisions of ERISA or the Code (each, a
"Plan"), and is not acting on behalf of any Plan or using the assets of any Plan
to effect such transfer or (B) with respect to the transfer of an
ERISA-Restricted Certificate that is not a Class P, Class X or Class R
Certificate, such transferee is an insurance company that is purchasing the
Certificate with funds contained in an "insurance company general account" (as
such term is defined in Section V(e) of Prohibited Transaction Class Exemption
95-60 ("PTCE 95-60")) and the conditions for exemptive relief
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under Sections I and III of PTCE 95-60 are satisfied with respect to the
purchase and holding of such Certificate. For purposes of the preceding
sentence, with respect to (i) the transfer of an ERISA-Restricted Certificate
that is not a Physical Certificate and (ii) the transfer of the Class X or Class
P Certificates from the NIM Issuer, if any, or the NIM Trustee, if any, to an
Affiliate of the Depositor or Unaffiliated Seller, in the event the
representation letter referred to in the preceding sentence is not furnished,
such representation shall be deemed to have been made to the Securities
Administrator by the transferee's (including an initial acquiror's) acceptance
of the ERISA-Restricted Certificate. In the event that such representation is
violated, such attempted transfer or acquisition shall be void and of no effect.
Each purchaser or transferee of an Offered Certificate that is a Plan,
or that is acting on behalf of a Plan or using the assets of a Plan to acquire
such Offered Certificate, shall be deemed to represent that (i) it qualifies as
an accredited investor as defined in Rule 501(a)(1) of Regulation D of the
Securities and Exchange Commission under the Securities Act and, for so long as
either of the Interest Rate Swap Agreement or the Interest Rate Cap Agreement is
in effect, (ii) its acquisition and holding of an interest in the Supplemental
Interest Trust will be eligible for the exemptive relief available under either
an Investor-Based Exemption or the statutory exemption under Section 408(b)(17)
of ERISA and Section 4975(d)(20) of the Code.
To the extent permitted under applicable law (including, but not
limited to, ERISA), the Securities Administrator shall be under no liability to
any Person for any registration of transfer of any ERISA-Restricted Certificate
that is in fact not permitted by this Section 5.02(b) or for making any payments
due on such Certificate to the Holder thereof or taking any other action with
respect to such Holder under the provisions of this Agreement so long as the
transfer was registered by the Securities Administrator in accordance with the
foregoing requirements.
(c) Each Person who has or who acquires any Ownership Interest in a
Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions, and
the rights of each Person acquiring any Ownership Interest in a Residual
Certificate are expressly subject to the following provisions:
(i) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall be a Permitted Transferee and shall promptly
notify the Securities Administrator of any change or impending change in
its status as a Permitted Transferee;
(ii) Other than in the case of the Depositor or an Affiliate of the
Depositor, no Ownership Interest in a Residual Certificate may be
registered on the Closing Date or thereafter transferred, and the
Securities Administrator shall not register the Transfer of any Residual
Certificate unless, in addition to the certificates required to be
delivered to the Securities Administrator under subparagraph (b) above, the
Securities Administrator shall have been furnished with an affidavit (a
"Transfer Affidavit") of the initial owner or the proposed transferee in
the form attached hereto as Exhibit H;
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(iii) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall agree (A) to obtain a Transfer Affidavit from
any other Person to whom such Person attempts to Transfer its Ownership
Interest in a Residual Certificate, (B) to obtain a Transfer Affidavit from
any Person for whom such Person is acting as nominee, trustee or agent in
connection with any Transfer of a Residual Certificate, and (C) not to
Transfer its Ownership Interest in a Residual Certificate or to cause the
Transfer of an Ownership Interest in a Residual Certificate to any other
Person if it has actual knowledge that such Person (i) is a Non-Permitted
Transferee;
(iv) Any attempted or purported Transfer of any Ownership Interest in
a Residual Certificate in violation of the provisions of Section 5.02(b)
and this Section 5.02(c) shall be absolutely null and void and shall vest
no rights in the purported Transferee. If any purported transferee shall
become a Holder of a Residual Certificate in violation of the provisions of
Section 5.02(b) and this Section 5.02(c), then the last preceding Permitted
Transferee shall be restored to all rights as Holder thereof retroactive to
the date of registration of Transfer of such Residual Certificate. The
Securities Administrator shall be under no liability to any Person for any
registration of Transfer of a Residual Certificate that is in fact not
permitted by Section 5.02(b) and this Section 5.02(c) or for making any
payments due on such Certificate to the Holder thereof or taking any other
action with respect to such Holder under the provisions of this Agreement
so long as the Transfer was registered after receipt of the related
Transfer Affidavit, Transferor Certificate and the Rule 144A Letter. The
Securities Administrator shall be entitled but not obligated to recover
from any Holder of a Residual Certificate that was in fact a Non-Permitted
Transferee at the time it became a Holder or, at such subsequent time as it
became a Non-Permitted Transferee, all payments made on such Residual
Certificate at and after either such time. Any such payments so recovered
by the Securities Administrator shall be paid and delivered by the
Securities Administrator to the last preceding Permitted Transferee of such
Certificate; and
(v) The Depositor shall use its best efforts to make available, upon
receipt of written request from the Securities Administrator, all
information necessary to compute any tax imposed under Section 860E(e) of
the Code as a result of a Transfer of an Ownership Interest in a Residual
Certificate to any Holder who is a Non-Permitted Transferee.
The restrictions on Transfers of a Residual Certificate set forth in
this Section 5.02(c) shall cease to apply (and the applicable portions of the
legend on a Residual Certificate may be deleted) with respect to Transfers
occurring after delivery to the Securities Administrator of an Opinion of
Counsel, which Opinion of Counsel shall not be an expense of the Trust Fund, the
Trustee, the Securities Administrator, the Unaffiliated Seller or the Servicer,
to the effect that the elimination of such restrictions will not cause the
transfer to be disregarded under Treasury regulations section 1.860E-1(c), cause
any REMIC created hereunder to fail to qualify as a REMIC at any time that the
Certificates are outstanding or result in the imposition of any tax on the Trust
Fund, a Certificateholder or another Person. Each Person holding or acquiring
any Ownership Interest in a Residual Certificate hereby consents to any
amendment of this
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Agreement which, based on an Opinion of Counsel furnished to the Securities
Administrator, is reasonably necessary (a) to ensure that the record ownership
of, or any beneficial interest in, a Residual Certificate is not transferred,
directly or indirectly, to a Person that is a Non-Permitted Transferee and (b)
to provide for a means to compel the Transfer of a Residual Certificate which is
held by a Person that is a Non-Permitted Transferee to a Holder that is a
Permitted Transferee.
(d) The preparation and delivery of all certificates and opinions
referred to above in this Section 5.02 in connection with transfer shall be at
the expense of the parties to such transfers.
(e) Except as provided below, the Book-Entry Certificates shall at all
times remain registered in the name of the Depository or its nominee and at all
times: (i) registration of the Certificates may not be transferred by the
Securities Administrator except to another Depository; (ii) the Depository shall
maintain book-entry records with respect to the Certificate Owners and with
respect to ownership and transfers of such Book-Entry Certificates; (iii)
ownership and transfers of registration of the Book-Entry Certificates on the
books of the Depository shall be governed by applicable rules established by the
Depository; (iv) the Depository may collect its usual and customary fees,
charges and expenses from its Depository Participants; (v) the Securities
Administrator shall deal with the Depository, Depository Participants and
indirect participating firms as representatives of the Certificate Owners of the
Book-Entry Certificates for purposes of exercising the rights of Holders under
this Agreement, and requests and directions for and votes of such
representatives shall not be deemed to be inconsistent if they are made with
respect to different Certificate Owners; and (vi) the Securities Administrator
may rely and shall be fully protected in relying upon information furnished by
the Depository with respect to its Depository Participants and furnished by the
Depository Participants with respect to indirect participating firms and persons
shown on the books of such indirect participating firms as direct or indirect
Certificate Owners.
All transfers by Certificate Owners of Book-Entry Certificates shall
be made in accordance with the procedures established by the Depository
Participant or brokerage firm representing such Certificate Owner. Each
Depository Participant shall only transfer Book-Entry Certificates of
Certificate Owners it represents or of brokerage firms for which it acts as
agent in accordance with the Depository's normal procedures.
If (x) (i) the Depository or the Depositor advises the Securities
Administrator in writing that the Depository is no longer willing or able to
properly discharge its responsibilities as Depository, and (ii) the Securities
Administrator or the Depositor is unable to locate a qualified successor or (y)
after the occurrence of an Event of Default, Certificate Owners representing at
least a majority of the Certificate Balance of the Book-Entry Certificates
together advise the Securities Administrator and the Depository through the
Depository Participants in writing that the continuation of a book-entry system
through the Depository is no longer in the best interests of the Certificate
Owners, the Securities Administrator shall notify all Certificate Owners,
through the Depository, of the occurrence of any such event and of the
availability of definitive, fully-registered Certificates (the "Definitive
Certificates") to Certificate Owners requesting the same. Upon surrender to the
Securities Administrator of the related Class of Certificates by the Depository,
accompanied by the instructions from the Depository for registration, the
Securities Administrator shall issue the Definitive Certificates. None of the
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Servicer, the Depositor, the Securities Administrator nor the Trustee shall be
liable for any delay in delivery of such instruction and each may conclusively
rely on, and shall be protected in relying on, such instructions. The Depositor
shall provide the Securities Administrator with an adequate inventory of
Certificates to facilitate the issuance and transfer of Definitive Certificates.
Upon the issuance of Definitive Certificates all references herein to
obligations imposed upon or to be performed by the Depository shall be deemed to
be imposed upon and performed by the Securities Administrator, to the extent
applicable with respect to such Definitive Certificates and the Securities
Administrator shall recognize the Holders of the Definitive Certificates as
Certificateholders hereunder; provided, that the Securities Administrator shall
not by virtue of its assumption of such obligations become liable to any party
for any act or failure to act of the Depository.
(f) Each Private Certificate presented or surrendered for registration
of transfer or exchange shall be accompanied by a written instrument of transfer
and accompanied by IRS Form W-8ECI, W-8BEN, W-8IMY (and all appropriate
attachments) or W-9 in form satisfactory to the Securities Administrator, duly
executed by the Certificateholder or his attorney duly authorized in writing.
Each Certificate presented or surrendered for registration of transfer or
exchange shall be canceled and subsequently disposed of by the Securities
Administrator in accordance with its customary practice. No service charge shall
be made for any registration of transfer or change of Private Certificates, but
the Securities Administrator may require payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in connection with any
transfer or exchange of private Certificates.
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates.
If (a) any mutilated Certificate is surrendered to the Securities
Administrator, or the Securities Administrator receives evidence to its
satisfaction of the destruction, loss or theft of any Certificate and (b) there
is delivered to the Depositor, the Servicer, the Securities Administrator and
the Trustee such security or indemnity as may be required by them to hold each
of them harmless, then, in the absence of notice to the Securities Administrator
that such Certificate has been acquired by a bona fide purchaser, the Securities
Administrator shall execute, authenticate and deliver, in exchange for or in
lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of like Class, tenor and Percentage Interest. In connection with the
issuance of any new Certificate under this Section 5.03, the Securities
Administrator may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Securities Administrator and
its counsel) connected therewith. Any replacement Certificate issued pursuant to
this Section 5.03 shall constitute complete and indefeasible evidence of
ownership, as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
Section 5.04 Persons Deemed Owners.
The Servicer, the Trustee, the Securities Administrator, the Master
Servicer and the Depositor and any agent of the Servicer, the Depositor, the
Securities Administrator, the Master Servicer or the Trustee may treat the
Person in whose name any Certificate is registered as the owner of such
Certificate for the purpose of receiving distributions as provided in this
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Agreement and for all other purposes whatsoever, and none of the Servicer, the
Trustee, the Securities Administrator, the Master Servicer and the Depositor nor
any agent of the Servicer, the Depositor, the Securities Administrator, the
Master Servicer or the Trustee shall be affected by any notice to the contrary.
Section 5.05 Access to List of Certificateholders' Names and
Addresses.
If three or more Certificateholders (a) request in writing such
information from the Securities Administrator, (b) state that such
Certificateholders desire to communicate with other Certificateholders with
respect to their rights under this Agreement or under the Certificates, and (c)
provide a copy of the communication which such Certificateholders propose to
transmit, or if the Depositor or the Servicer shall request such information in
writing from the Securities Administrator, then the Securities Administrator
shall, within ten Business Days after the receipt of such request, provide the
Depositor, the Servicer or such Certificateholders at such recipients' expense
the most recent list of the Certificateholders of such Trust Fund held by the
Securities Administrator, if any. The Depositor and every Certificateholder, by
receiving and holding a Certificate, agree that the Securities Administrator
shall not be held accountable by reason of the disclosure of any such
information as to the list of the Certificateholders hereunder, regardless of
the source from which such information was derived.
Section 5.06 Maintenance of Office or Agency.
The Securities Administrator will maintain or cause to be maintained
at its expense an office or offices or agency or agencies in Minnesota where
Certificates may be surrendered for registration of transfer or exchange. The
Securities Administrator initially designates its office for such purposes
located at Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx, XX 00000. The
Securities Administrator shall give prompt written notice to the
Certificateholders of any change in such location of any such office or agency.
ARTICLE VI
THE DEPOSITOR AND THE SERVICER
Section 6.01 Respective Liabilities of the Depositor and the Servicer.
The Depositor and the Servicer shall each be liable in accordance
herewith only to the extent of the obligations specifically and respectively
imposed upon and undertaken by them herein.
Section 6.02 Merger or Consolidation of the Depositor or the Servicer.
The Depositor and the Servicer will each keep in full effect its
existence, rights and franchises as a corporation or limited partnership, as the
case may be, under the laws of the United States or under the laws of one of the
states thereof and will each obtain and preserve its qualification to do
business as a foreign corporation 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 respective duties under this Agreement.
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Any Person into which the Depositor or the Servicer may be merged or
consolidated, or any Person resulting from any merger or consolidation to which
the Depositor or the Servicer shall be a party, or any person succeeding to the
business of the Depositor or the Servicer, shall be the successor of the
Depositor or the Servicer, as the case may be, 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 successor or surviving Person to the Servicer shall be qualified to sell
mortgage loans to, and to service mortgage loans on behalf of, Xxxxxx Xxx or
FHLMC.
The Servicer is and shall continue to be an institution which is a
Xxxxxx Mae and FHLMC approved seller/servicer in good standing.
Section 6.03 Limitation on Liability of the Depositor, the Servicer
and Others.
None of the Depositor, the Servicer, the Custodian, the Securities
Administrator, the Trustee, the Master Servicer nor any of their respective
directors, officers, employees or agents shall be under any liability to the
Certificateholders 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 Depositor, the
Servicer, the Custodian, the Securities Administrator, the Trustee, the Master
Servicer or any such Person against any breach of representations or warranties
made by it herein or protect the Depositor, the Servicer, the Custodian, the
Securities Administrator, the Trustee, the Master Servicer or any such Person
from any liability which would otherwise be imposed by reasons of willful
misfeasance, bad faith or negligence (or with respect to the Depositor, gross
negligence) in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder. The Depositor and any director, officer,
employee or agent of the Depositor 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 Depositor, the Servicer, the Custodian, the
Securities Administrator, the Trustee, the Master Servicer and any director,
officer, employee or agent of the Depositor, the Servicer, the Custodian, the
Securities Administrator, the Master Servicer or the Trustee shall be
indemnified by the Trust Fund and held harmless against any loss, liability or
expense incurred in connection with any audit, controversy or judicial
proceeding relating to a governmental taxing authority or any legal action and,
in the case of the Trustee, the Master Servicer and the Securities
Administrator, other matters (other than standard administrative expenses
incurred in its role as Securities Administrator) relating to this Agreement or
the Certificates (including, as to the Trustee and the Securities Administrator,
the undertaking of actions as directed by the Unaffiliated Seller pursuant to
Section 2.03), other than any loss, liability or expense incurred by reason of
willful misfeasance, bad faith or negligence (or with respect to the Depositor,
gross negligence) in the performance of their respective duties hereunder or by
reason of reckless disregard of their respective obligations and duties
hereunder. The Depositor shall not be under any obligation to appear in,
prosecute or defend any legal action that is not incidental to its respective
duties hereunder and which in its opinion may involve it in any expense or
liability; provided, however, that the Depositor may in its discretion undertake
any such action (or direct the Securities Administrator to undertake any such
actions pursuant to Section 2.03 hereof for the benefit of the
Certificateholders) that it may deem necessary or desirable in respect of this
Agreement and the rights and duties of the parties hereto and interests of the
Securities Administrator and the Certificateholders hereunder. In such event,
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the legal expenses and costs of such action and any liability resulting
therefrom shall be expenses, costs and liabilities of the Trust Fund, and the
Depositor shall be entitled to be reimbursed therefor out of the Collection
Account.
Neither the Servicer nor any of the officers, employees or agents of
the Servicer shall be under any liability to the Trustee, the Custodian, the
Securities Administrator, the Master Servicer or the Depositor for any action
taken or for refraining from the taking of any action in good faith pursuant to
this Agreement; provided, however, that this provision shall not protect the
Servicer or any such person against any breach of warranties or representations
made herein, or failure to perform its obligations in compliance with the terms
of this Agreement, or any liability which would otherwise be imposed by reason
of any breach of the terms and conditions of this Agreement. The Servicer and
any officer, employee or agent of the Servicer 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 Servicer 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 expenses or liability;
provided, however, that the Servicer may 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 legal expenses and costs of
such action and any liability resulting therefrom shall be expenses, costs and
liabilities of the Trust Fund, and the Servicer shall be entitled to be
reimbursed therefor out of its Collection Account. In the event the Servicer
agrees, at the request of the Depositor, to act on behalf of the Depositor in
any litigation relating to the origination of a Mortgage Loan, the Depositor
shall pay all expenses associated with the defense and management of such claim
(without reimbursement from the Trust Fund).
Section 6.04 Limitation on Resignation of the Servicer.
The Servicer shall not assign this Agreement or resign from the
obligations and duties hereby imposed on it except by mutual consent of the
Servicer, the Securities Administrator, the Master Servicer, the Depositor and
the Trustee (and written notice to the Custodian) or upon the determination that
its duties hereunder are no longer permissible under applicable law and such
incapacity cannot be cured by the Servicer. Any such determination permitting
the resignation of the Servicer shall be evidenced by an Opinion of Counsel to
such effect delivered to the Depositor and the Securities Administrator which
Opinion of Counsel shall be in form and substance acceptable to the Depositor
and the Securities Administrator. No such resignation shall become effective
until a successor shall have assumed the Servicer's responsibilities and
obligations hereunder. Notwithstanding anything to the contrary herein, the
Servicer may pledge or assign as collateral all its rights, title and interest
under this Agreement to a lender (the "Lender"); provided that the Lender may
only terminate the Servicer under this Agreement if there has been an Event of
Default under this Agreement, in which event the Lender may replace the Servicer
in the same manner and subject to the same conditions applicable in the event
the Servicer is appointing a successor Servicer upon a servicer termination
pursuant to Section 7.02.
Notwithstanding the provisions of Section 6.04 herein to the contrary,
in the event that the Servicer determines that it will no longer engage in the
business of servicing mortgage
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loans, the Servicer may assign its rights under this Agreement, provided that,
(i) the Rating Agencies' ratings of the Certificates in effect immediately prior
to such action will not be qualified, reduced or withdrawn as a result thereof
(as evidenced by a letter to such effect from the Rating Agencies) and (ii) the
Servicer shall be liable for all costs and expenses associated with the transfer
of servicing, provided further, that the Servicer shall indemnify and hold each
of the Trust Fund, the Master Servicer, the Trustee, the Custodian, the
Depositor, any sub-servicer, the successor Servicer and each Certificateholder
harmless against any and all claims, losses, penalties, fines, forfeitures,
reasonable legal fees and related costs, judgments, and any other costs, fees
and expenses that such party may sustain in any way related to such assignment
except with respect to a successor Servicer's failure to comply with the terms
of this Agreement. No assignment by the Servicer shall become effective until a
successor Servicer acceptable to the Depositor and the Master Servicer shall
have assumed in writing the Servicer's responsibilities, duties, liabilities
(other than those liabilities arising prior to the appointment of such
successor) and obligations under this Agreement. Any such assignment shall not
relieve the Servicer of responsibility for any of the obligations specified
herein except to the extent that such responsibilities have been expressly
assumed by the successor Servicer.
Section 6.05 Additional Indemnification by the Servicer; Third Party
Claims.
(a) The Servicer shall indemnify the Depositor (and its Affiliate,
Xxxxxx Xxxxxxx Mortgage Capital Inc.), the Unaffiliated Seller, the Custodian,
the Securities Administrator, the Master Servicer and the Trustee and any
director, officer, employee, or agent of the Depositor (or its Affiliate, Xxxxxx
Xxxxxxx Mortgage Capital Inc.), the Unaffiliated Seller, the Custodian, the
Securities Administrator, the Master Servicer and the Trustee and hold them
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 any of them may sustain in any way
related to any breach by the Servicer, of any of its representations and
warranties referred to in Section 2.03(a)(i) or the failure of the Servicer to
perform its duties and service the Mortgage Loans in compliance with the terms
of this Agreement (including without limitation, the failure to deliver accurate
and complete information on a timely basis pursuant to Section 4.03(d)). The
Servicer shall indemnify the Unaffiliated Seller and any director, officer,
employee, or agent of the Unaffiliated Seller and the Trust Fund 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 it may sustain in any way related to
any breach by the Servicer, of any of its representations and warranties
referred to in Section 2.03(a)(ii). The Servicer immediately shall notify the
Depositor, the Unaffiliated Seller, the Custodian, the Securities Administrator,
the Master Servicer and the Trustee if a claim is made by a third party with
respect to any such breach or failure by the Servicer under this Agreement,
assume (with the prior written consent of the Depositor, the Unaffiliated
Seller, the Custodian, the Securities Administrator, the Master Servicer and the
Trustee, as applicable) the defense of any such claim and pay all expenses in
connection therewith, including reasonable counsel fees, and promptly pay,
discharge and satisfy any judgment or decree which may be entered against it or
the Depositor, the Unaffiliated Seller, the Custodian, the Securities
Administrator, the Master Servicer or the Trustee in respect of such claim;
provided, that if it is determined that the Servicer is not obligated to
indemnify such parties in accordance with this Section 6.05, each such party (or
the Trust Fund, if applicable)
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shall promptly reimburse the Servicer in connection with each of the foregoing
payments made to such party by the Servicer. This indemnity shall survive the
termination of this Agreement or the earlier resignation or removal of the
Servicer.
(b) Notwithstanding anything to the contrary contained in this
Agreement, the Servicer shall indemnify the Depositor (and its Affiliate Xxxxxx
Xxxxxxx Mortgage Capital Inc.), the Unaffiliated Seller, the Custodian, the
Trustee, the Securities Administrator, the Master Servicer and any director,
officer, employee or agent of the Depositor (and its Affiliate Xxxxxx Xxxxxxx
Mortgage Capital Inc.), the Unaffiliated Seller, the Custodian, the Trustee, the
Securities Administrator and the Master Servicer and hold them 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 any of them may sustain in any way related to any failure by
the Servicer or any Subservicer engaged by the Servicer or any Subcontractor
utilized by the Servicer to deliver any information, report, certification or
accountants' letter when and as required under Sections 3.22, 3.23, 6.02 or
8.12, including without limitation any failure by the Servicer to identify
pursuant to Section 3.02(e) any Subcontractor "participating in the servicing
function" within the meaning of Item 1122 of Regulation AB.
(c) If the indemnification provided for in this Section 6.05 is
unavailable or insufficient to hold harmless any Person entitled to
indemnification thereunder, then the Servicer shall contribute to the amount
paid or payable by the Person entitled to indemnification as a result of the
losses, claims, damages or liabilities of such Person in such proportion as is
appropriate to reflect the relative fault of such Person on the one hand and the
Servicer, on the other, in connection with the Servicer's obligations pursuant
to this Section 6.05. This Section 6.05 shall survive the termination of this
Agreement or the earlier resignation or removal of the Servicer.
ARTICLE VII
DEFAULT
Section 7.01 Events of Default.
"Event of Default," wherever used herein, means with respect to the
Servicer individually, any one of the following events:
(a) any failure by the Servicer to remit to the Securities
Administrator or the Master Servicer any payment required to be made under the
terms of this Agreement which continues unremedied for a period of one Business
Day after the date upon which written notice of such failure, requiring the same
to be remedied, shall have been given to the Servicer by the Depositor, by the
Securities Administrator, by the Master Servicer or by the Trustee or to the
Servicer, the Trustee, the Depositor, the Securities Administrator or the Master
Servicer by Certificateholders entitled to at least 25% of the Voting Rights in
the Certificates; or
(b) failure on the part of the Servicer to duly observe or perform in
any material respect any other of the covenants or agreements on the part of the
Servicer set forth in
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this Agreement which continues unremedied for a period of forty-five days
(except that (x) such number of days shall be fifteen in the case of a failure
to pay any premium for any insurance policy required to be maintained under this
Agreement and (y) such number of days shall be ten in the case of a failure to
observe or perform any of the obligations set forth in Sections 3.02, 3.22,
3.23, 6.02 or 8.12 (provided that with respect to Sections 3.22, 3.23 and 8.12,
the number of days shall in no case result in the Servicer's delivery of the
required documents thereunder to be delivered after March 1 of each year)) after
the earlier of (i) the date on which written notice of such failure, requiring
the same to be remedied, shall have been given to the Servicer by the Depositor,
by the Securities Administrator, the Master Servicer or by the Trustee, or to
the Master Servicer by Certificateholders entitled to at least 25% of the Voting
Rights in the Certificates and (ii) actual knowledge of such failure by a
Servicing Officer of the Servicer; or
(c) 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, bankruptcy, readjustment of debt, marshalling of
assets and liabilities or similar proceedings, or for the winding-up or
liquidation of its affairs, shall have been entered against the Servicer and
such decree or order shall have remained in force undischarged or unstayed for a
period of sixty days; or
(d) the Servicer shall consent to the appointment of a conservator or
receiver or liquidator in any insolvency, bankruptcy, readjustment of debt,
marshalling of assets and liabilities or similar proceedings of or relating to
the Servicer or of or relating to all or substantially all of its property; or
(e) the Servicer 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 or reorganization statute, make an assignment for the
benefit of its creditors, or voluntarily suspend payment of its obligations; or
(f) Fitch reduces its servicer rating of the Servicer to "RPS2-" or
lower, Xxxxx'x reduces its servicer rating of the Servicer to "SQ3" or lower, or
Standard & Poor's reduces its servicer rating of the Servicer to "Average" or
lower; or
(g) any failure of the Servicer to make any P&I Advance on any
Remittance Date required to be made from its own funds pursuant to Section 4.01
which continues unremedied for one Business Day immediately following the
Remittance Date; or
(h) a breach of any representation and warranty of the Servicer
referred to in Section 2.03(a), which materially and adversely affects the
interests of the Certificateholders and which continues unremedied for a period
of thirty days after the earlier of (i) the date upon which written notice of
such breach is given to the Servicer by the Trustee, by the Securities
Administrator, by the Master Servicer or by the Depositor, or to the Servicer,
the Depositor, the Master Servicer, the Securities Administrator and the Trustee
by any Certificateholders entitled to at least 25% of the Voting Rights in the
Certificates and (ii) actual knowledge of such breach by a Servicing Officer of
the Servicer; or
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(i) any reduction, withdrawal or qualification of the Servicer's
servicer rating by any Rating Agency which results in the Servicer being deemed
unacceptable by any Rating Agency to act as a primary servicer for this
transaction or a primary servicer or a special servicer for any other
mortgage-backed or asset-backed transaction rated or to be rated by any such
Rating Agency; or
(j) the occurrence of a Servicing Trigger Event.
If an Event of Default shall occur, then, and in each and every such
case, so long as such Event of Default shall not have been remedied, the Master
Servicer may, or at the direction of Holders holding a majority of the Voting
Rights, the Master Servicer shall, by notice in writing to the Servicer (with a
copy to each Rating Agency), terminate all of the rights and obligations of the
Servicer under this Agreement and in and to the Mortgage Loans and the proceeds
thereof, other than its rights as a Certificateholder hereunder; provided,
however, that the Master Servicer shall not be required to give written notice
to the Servicer of the occurrence of an Event of Default described in clauses
(b) through (i) of this Section 7.01 unless and until a Responsible Officer of
the Master Servicer has actual knowledge of the occurrence of such an Event of
Default. In the event that a Responsible Officer of the Master Servicer has
actual knowledge of the occurrence of an event of default described in clause
(a) of this Section 7.01, the Master Servicer shall give written notice to the
Servicer and the Unaffiliated Seller of the occurrence of such an event within
one Business Day of the first day on which such Responsible Officer obtains
actual knowledge of such occurrence; provided, however, that the failure of the
Master Servicer to provide such notice within one Business Day will not affect
the rights of the Depositor or the Certificateholders to provide notice as
required pursuant to clause (a) of this Section 7.01. On and after the receipt
by the Servicer of such written notice, all authority and power of the Servicer
hereunder, whether with respect to the Mortgage Loans serviced by the Servicer
or otherwise, shall pass to and be vested the Master Servicer within a period of
time not to exceed 90 days. If an Event of Default described in clause (g) shall
occur, and shall not have been cured at least two (2) Business Days, prior to
the related Distribution Date, the Master Servicer shall, prior to the related
Distribution Date, immediately terminate the rights and obligations of the
Servicer hereunder and the Master Servicer, as the case may be, shall succeed to
the rights and obligations of the Servicer hereunder pursuant to Section 7.02,
including the obligation to immediately make any P&I Advances, which the
Servicer failed to make subject to Section 4.01 pursuant to the terms hereof
prior to such Distribution Date. Any costs related to the transfer of servicing
from the Servicer to the Master Servicer shall be reimbursable by the Trust
Fund. The Master Servicer is hereby authorized and empowered to execute and
deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and
all documents and other instruments, and to do or accomplish all other acts or
things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement or assignment of
the Mortgage Loans and related documents, or otherwise. Unless expressly
provided in such written notice, no such termination shall affect any obligation
of the Servicer to pay amounts owed pursuant to Article VIII. The Servicer
agrees to cooperate with the Master Servicer in effecting the termination of the
Servicer's responsibilities and rights hereunder, including, without limitation,
the transfer to the Master Servicer, as applicable, of all cash amounts which
shall at the time be credited to the Collection Account of such predecessor
Servicer, or thereafter be received with respect to the Mortgage Loans serviced
by such predecessor Servicer.
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Notwithstanding any termination of the activities of the Servicer
hereunder, the Servicer shall be entitled to receive, out of any late collection
of a Scheduled Payment on a Mortgage Loan which was due prior to the notice
terminating the Servicer's rights and obligations as the Servicer hereunder and
received after such notice, that portion thereof to which the Servicer would
have been entitled pursuant to Section 3.11, and any other amounts payable to
the Servicer hereunder the entitlement to which arose prior to the termination
of its activities hereunder in accordance with Section 3.11 and in the time
period specified in Section 3.11. The Servicer shall continue to be entitled to
the benefits of Section 6.03, notwithstanding any termination hereunder, with
respect to events occurring prior to such termination.
Section 7.02 Master Servicer to Act; Appointment of Successor.
On and after the time the Servicer receives a notice of termination
pursuant to Section 3.24 or Section 7.01, subject to the third paragraph of this
Section 7.02, the Master Servicer shall, subject to and to the extent provided
in Section 3.24, be the successor to the Servicer in its capacity as servicer
under this Agreement and the transactions set forth or provided for herein and
shall be subject to all the responsibilities, duties and liabilities relating
thereto placed on the Servicer by the terms and provisions hereof and applicable
law including the obligation to make P&I Advances and Servicing Advances
pursuant to Section 4.01. As compensation therefor, the Master Servicer shall be
entitled to all funds relating to the Mortgage Loans that the Servicer would
have been entitled to charge to the Collection Account or the Distribution
Account if the Servicer had continued to act hereunder including, if the
Servicer was receiving the Servicing Fee, the Servicing Fee and the income on
investments or gain related to the Collection Account and the Distribution
Account. The predecessor Servicer shall pay all costs and expenses incurred in
connection with a transfer of servicing in the event of termination of the
Servicer for cause to a successor Servicer. In the event the full costs
associated with the transition of servicing responsibilities to the Master
Servicer are not paid by the predecessor Servicer, such costs shall be paid by
the Trust.
Notwithstanding the foregoing, if the Master Servicer has become the
successor to the Servicer in accordance with Section 7.01, the Master Servicer,
as applicable, may, if it shall be unwilling to so act, or shall, if it is
prohibited by applicable law from making P&I Advances and Servicing Advances
pursuant to Section 4.01, if it is otherwise unable to so act, or at the
direction of Holders holding a majority of the Voting Rights, appoint, or
petition a court of competent jurisdiction to appoint, any established mortgage
loan servicing institution the appointment of which does not adversely affect
the then current rating of the Certificates by each Rating Agency, as the
successor to the Servicer hereunder in the assumption of all or any part of the
responsibilities, duties or liabilities of the Servicer hereunder. Any successor
to the Servicer shall be an institution which is a Xxxxxx Mae and FHLMC approved
seller/servicer in good standing, which is willing to service the Mortgage Loans
and which executes and delivers to the Depositor and the Trustee an agreement
accepting such delegation and assignment, containing an assumption by such
Person of the rights, powers, duties, responsibilities, obligations and
liabilities of the Servicer (other than liabilities of the Servicer under
Section 6.03 incurred prior to termination of the Servicer under Section 7.01),
with like effect as if originally named as a party to this Agreement; provided
that each Rating Agency acknowledges that its rating of the Certificates in
effect immediately prior to such assignment and delegation will not be qualified
or reduced, as a result of such assignment and delegation. Pending appointment
of a successor to
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the Servicer hereunder, the Master Servicer, unless the Master Servicer is
prohibited by law from so acting, shall, subject to Section 3.05, act in such
capacity as hereinabove provided. In connection with such appointment and
assumption, the Master Servicer may make such arrangements for the compensation
of such successor out of payments on Mortgage Loans serviced by such predecessor
Servicer as it and such successor shall agree; provided, however, that no such
compensation shall be in excess of the Servicing Fee Rate and amounts paid to
the predecessor Servicer from investments. The Master Servicer and such
successor shall take such action, consistent with this Agreement, as shall be
necessary to effectuate any such succession. Neither the Master Servicer nor any
other successor Servicer shall be deemed to be in default hereunder by reason of
any failure to make, or any delay in making, any distribution hereunder or any
portion thereof or any failure to perform, or any delay in performing, any
duties or responsibilities hereunder, in either case caused by the failure of
the predecessor Servicer to deliver or provide, or any delay in delivering or
providing, any cash, information, documents or records to it. If no successor
Servicer meeting such qualifications shall have been approved by the Depositor
within 30 days after the giving of such notice or resignation, the Master
Servicer may petition any court of competent jurisdiction for the appointment of
a successor Servicer meeting the qualifications set forth in Section 7.02.
Notwithstanding any provision in this Agreement to the contrary, prior
to the 20th day following the notice of termination of the Servicer, the
terminated Servicer may appoint a successor Servicer that satisfies the
eligibility criteria of a successor Servicer set forth in this Section 7.02;
provided any successor Servicer hereunder agrees to fully effect the servicing
transfer within 30 days following the termination of the predecessor Servicer
and to make all P&I Advances, Servicing Advances and payments pursuant to
Section 7.01(a) that would otherwise be made by the Servicer under this Section
7.02 as of the date of such appointment and prior thereto, the terminated
Servicer makes all P&I Advances, Servicing Advances and payments pursuant to
Section 7.02; provided, however, that, in the event that such terminated
Servicer does not make such P&I Advances, Servicing Advances or payments under
Section 7.01(a), the provisions of this paragraph shall not apply; otherwise the
Master Servicer shall appoint a successor Servicer as otherwise set forth in
this Section 7.02. Any proceeds received in connection with the appointment of
such successor Servicer shall be the property of the terminated Servicer or its
designee.
Any successor to the Servicer as servicer shall give notice to the
related Mortgagors of such change of servicer and shall, during the term of its
service as servicer, maintain in force the policy or policies that the Servicer
is required to maintain pursuant to Section 3.13.
Section 7.03 Notification to Certificateholders.
(a) Upon any termination of or appointment of a successor to the
Servicer, the Securities Administrator shall give prompt written notice thereof
to Certificateholders, the Unaffiliated Seller, the Swap Provider, the Cap
Provider and to each Rating Agency.
(b) Within 60 days after the occurrence of any Event of Default, the
Securities Administrator shall transmit by mail to all Certificateholders, the
Unaffiliated Seller, the Cap Provider, the Swap Provider and each Rating Agency
notice of each such Event of Default
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hereunder known to the Securities Administrator, unless such Event of Default
shall have been cured or waived.
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01 Duties of the Trustee.
The Trustee, before the occurrence of a Master Servicer Event of
Default and after the curing of Master Servicer Events of Default that may have
occurred, shall undertake to perform such duties and only such duties as are
specifically set forth in this Agreement. In case a Master Servicer Event of
Default has occurred and remains uncured, the Trustee shall exercise such of the
rights and powers vested in it by this Agreement, and use the same degree of
care and skill in their exercise as a prudent person would exercise or use under
the circumstances in the conduct of such person's own affairs.
The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee that are specifically required to be furnished pursuant to any
provision of this Agreement shall examine them to determine whether they are in
the form required by this Agreement. The Trustee shall not be responsible for
the accuracy or content of any resolution, certificate, statement, opinion,
report, document, order, or other instrument.
No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct.
Unless a Master Servicer Event of Default of which a Responsible
Officer of the Trustee has actual knowledge or written notice has occurred and
is continuing,
(a) the duties and obligations of the Trustee shall be determined
solely by the express provisions of this Agreement, the Trustee shall not be
liable except for the performance of the duties and obligations specifically set
forth in this Agreement, no implied covenants or obligations shall be read into
this Agreement against the Trustee, and the Trustee may conclusively rely, as to
the truth of the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the Trustee and
conforming to the requirements of this Agreement which it believed in good faith
to be genuine and to have been duly executed by the proper authorities
respecting any matters arising hereunder;
(b) the Trustee shall not be liable for an error of judgment made in
good faith by a Responsible Officer or Responsible Officers of the Trustee,
unless it is finally proven that the Trustee was negligent in ascertaining the
pertinent facts;
(c) the Trustee shall not be liable with respect to any action taken,
suffered, or omitted to be taken by it in good faith in accordance with the
direction of the Holders of Certificates evidencing not less than 25% of the
Voting Rights of Certificates relating to the
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time, method, and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred upon the Trustee under
this Agreement; and
(d) none of the provisions contained in this Agreement shall in any
event require the Trustee to perform, or be responsible for the manner of
performance of, any of the obligations of the Master Servicer under this
Agreement except during such time, if any, as the Trustee shall be the successor
to, and be vested with the rights, duties, powers and privileges of, the Master
Servicer in accordance with the terms of this Agreement.
Section 8.02 Certain Matters Affecting the Trustee and the Custodian.
Except as otherwise provided in Section 8.01:
(a) the Trustee may request and rely upon and shall be protected in
acting or refraining from acting upon any resolution, Officer's Certificate,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond or other paper
or document believed by it to be genuine and to have been signed or presented by
the proper party or parties and the Trustee shall have no responsibility to
ascertain or confirm the genuineness of any signature of any such party or
parties;
(b) the Trustee may consult with counsel, financial advisers or
accountants and the advice of any such counsel, financial advisers or
accountants and any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken or suffered or omitted by it
hereunder in good faith and in accordance with such Opinion of Counsel;
(c) the Trustee shall not be liable for any action taken, suffered or
omitted by it in good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Agreement;
(d) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or other paper
or document, unless requested in writing to do so by the Holders of Certificates
evidencing not less than 25% of the Voting Rights allocated to each Class of
Certificates; provided, however, that if the payment within a reasonable time to
the Trustee of the costs, expenses or liabilities likely to be incurred by it in
the making of such investigation is, in the opinion of the Trustee, not assured
to the Trustee by the security afforded to it by the terms of this Agreement,
the Trustee may require indemnity satisfactory to the Trustee against such cost,
expense or liability as a condition to taking any such action;
(e) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents,
accountants or attorneys and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agents, accountants or attorneys
appointed with due care by it hereunder;
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(f) the Trustee shall not be required to risk or expend its own funds
or otherwise incur any financial liability in the performance of any of its
duties or in the exercise of any of its rights or powers hereunder if it shall
have reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not assured to it;
(g) the Trustee shall not be liable for any loss on any investment of
funds pursuant to this Agreement;
(h) except as otherwise provided in Section 7.01 or if a Responsible
Officer of the Trustee has actual knowledge or written notice of the occurrence
of a Master Servicer Event of Default, the Trustee shall not be deemed to have
knowledge of a Master Servicer Event of Default until a Responsible Officer of
the Trustee shall have received written notice thereof;
(i) the Trustee shall be under no obligation to exercise any of the
trusts, rights or powers vested in it by this Agreement or to institute, conduct
or defend any litigation hereunder or in relation hereto at the request, order
or direction of any of the Certificateholders, pursuant to this Agreement,
unless such Certificateholders shall have offered to the Trustee reasonable
security or indemnity satisfactory to the Trustee against the costs, expenses
and liabilities which may be incurred therein or thereby;
(j) the right of the Trustee to perform any discretionary act
enumerated in this Agreement shall not be construed as a duty, and the Trustee
shall not be answerable for other than its negligence or willful misconduct in
the performance of such act;
(k) the Trustee shall not be required to give any bond or surety in
respect of the execution of the Trust Fund created hereby or the powers granted
hereunder; and
(l) the Custodian shall be entitled to the same protections,
immunities and indemnities afforded the Trustee in and under this Agreement.
(m) the Custodian shall be permitted to utilize one or more
Subcontractors for the performance of certain of its obligations under this
Agreement, provided that the Custodian complies with Section 3.02(e) as if the
Custodian were a "Servicer" pursuant to that Section. The Custodian shall
indemnify the Depositor (and its Affiliate Xxxxxx Xxxxxxx Mortgage Capital
Inc.), the Unaffiliated Seller, the Trustee, the Securities Administrator, the
Master Servicer and any director, officer, employee or agent of the Depositor
(and its Affiliate Xxxxxx Xxxxxxx Mortgage Capital Inc.), the Unaffiliated
Seller, the Trustee, the Securities Administrator and the Master Servicer and
hold them 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 any of them may sustain
in any way related to the failure of the Custodian to perform any of its
obligations under Section 3.23, including without limitation any failure by the
Custodian to identify pursuant to Section 3.02(e) any Subcontractor that is a
Servicing Function Participant. This indemnity shall survive the termination of
this Agreement or the earlier resignation or removal of the Custodian.
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Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates shall be taken
as the statements of the Depositor and the Trustee assumes no responsibility for
their correctness. The Trustee makes no representations as to the validity or
sufficiency of this Agreement or of the Certificates or of any Mortgage Loan or
related document other than with respect solely as to the Trustee's execution of
the Certificates. The Trustee shall not be accountable for the use or
application by the Depositor, the Master Servicer, the Securities Administrator
or the Servicer of any funds paid to the Depositor, the Master Servicer, the
Securities Administrator or the Servicer in respect of the Mortgage Loans or
deposited in or withdrawn from the Distribution Account or any Collection
Account by the Depositor, the Master Servicer, the Securities Administrator or
the Servicer.
The Trustee, the Securities Administrator, and the Master Servicer
shall have no responsibility for filing or recording any financing or
continuation statement in any public office at any time or to otherwise perfect
or maintain the perfection of any security interest or lien granted to it
hereunder.
Section 8.04 Trustee May Own Certificates.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Certificates with the same rights as it would have if it
were not the Trustee.
Section 8.05 Trustee's and Custodian's Fees and Expenses.
(a) As compensation for its activities under this Agreement, the
Trustee and the Custodian each shall be paid its fee by the Securities
Administrator from the Securities Administrator's own funds pursuant to a
separate fee schedule and shall have no lien on the Trust Fund for the payment
of such fees. The Custodian, the Trustee and any director, officer, employee, or
agent of the Custodian or the Trustee shall be indemnified by the Servicer
against any loss, liability, or expense (including reasonable attorney's fees)
resulting from any failure by the Servicer to perform their obligations under
this Agreement. This indemnity shall survive the termination of this Agreement
or the resignation or removal of the Trustee and the Custodian, as applicable,
under this Agreement.
(b) [Reserved].
(c) Each of the undertakings and agreements made on the part of the
Trustee on behalf of the Trust Fund in the Certificates is made and intended not
as a personal undertaking or agreement by the Trustee but is made and intended
for the purpose of binding only the Trust Fund.
Section 8.06 Eligibility Requirements for the Trustee.
The Trustee hereunder shall at all times be a corporation or
association organized and doing business under the laws of a state or the United
States of America, authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at least $50,000,000, subject
to supervision or examination by federal or state authority and with a credit
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rating which would not cause any of the Rating Agencies to reduce their
respective then current ratings of the Certificates (or having provided such
security from time to time as is sufficient to avoid such reduction) as
evidenced in writing by each Rating Agency. If such corporation or association
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purposes of this Section 8.06 the combined capital and surplus of such
corporation or association shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with this
Section 8.06, the Trustee shall resign immediately in the manner and with the
effect specified in Section 8.07. The entity serving as Trustee may have normal
banking and trust relationships with the Depositor and its affiliates or the
Servicer and its affiliates; provided, however, that such entity cannot be an
affiliate of the Depositor, the Unaffiliated Seller or the Servicer.
Section 8.07 Resignation and Removal of the Trustee.
The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice of resignation to the Depositor, the
Servicer, the Swap Provider, the Cap Provider, the Custodian, the Unaffiliated
Seller, the Securities Administrator, the Master Servicer and each Rating Agency
not less than 60 days before the date specified in such notice, when, subject to
Section 8.08, such resignation is to take effect, and acceptance by a successor
trustee in accordance with Section 8.08 meeting the qualifications set forth in
Section 8.06. If no successor trustee meeting such qualifications shall have
been so appointed and have accepted appointment within 30 days after the giving
of such notice or resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor trustee.
If at any time the Trustee shall cease to be eligible in accordance
with Section 8.06 and shall fail to resign after written request thereto by the
Depositor, or if at any time the Trustee shall become incapable of acting, or
shall be adjudged as bankrupt or insolvent, or a receiver of the Trustee or of
its property shall be appointed, or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, or a tax is imposed with respect to
the Trust Fund by any state in which the Trustee or the Trust Fund is located
and the imposition of such tax would be avoided by the appointment of a
different trustee, then the Depositor may remove the Trustee and appoint a
successor trustee by written instrument, in triplicate, one copy of which shall
be delivered to the Trustee, one copy to the Servicer, one copy to the Master
Servicer and one copy to the successor trustee.
The Holders of Certificates entitled to at least a majority of the
Voting Rights may at any time remove the Trustee and appoint a successor trustee
by written instrument or instruments, in triplicate, signed by such Holders or
their attorneys-in-fact duly authorized, one complete set of which shall be
delivered by the successor Trustee to the Servicer, one complete set to the
Trustee so removed and one complete set to the successor so appointed. The
successor trustee shall notify the Swap Provider, the Cap Provider and each
Rating Agency of any removal of the Trustee.
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Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to this Section 8.07 shall become effective upon
acceptance of appointment by the successor trustee as provided in Section 8.08.
Section 8.08 Successor Trustee.
Any successor trustee appointed as provided in Section 8.07 shall
execute, acknowledge and deliver to the Swap Provider, the Cap Provider, the
Depositor and to its predecessor trustee and the Servicer an instrument
accepting such appointment hereunder and thereupon the resignation or removal of
the predecessor trustee shall become effective and such successor trustee,
without any further act, deed or conveyance, shall become fully vested with all
the rights, powers, duties and obligations of its predecessor hereunder, with
the like effect as if originally named as trustee herein. The Depositor, the
Servicer, Securities Administrator and the predecessor trustee shall execute and
deliver such instruments and do such other things as may reasonably be required
for more fully and certainly vesting and confirming in the successor trustee all
such rights, powers, duties, and obligations.
No successor trustee shall accept appointment as provided in this
Section 8.08 unless at the time of its acceptance, the successor trustee is
eligible under Section 8.06 and its appointment does not adversely affect the
then current rating of the Certificates.
Upon acceptance of appointment by a successor trustee as provided in
this Section 8.08, the Depositor shall mail notice of the succession of such
trustee hereunder to all Holders of Certificates. If the Depositor fails to mail
such notice within 10 days after acceptance of appointment by the successor
trustee, the successor trustee shall cause such notice to be mailed at the
expense of the Depositor.
Section 8.09 Merger or Consolidation of the Trustee.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to the business of the Trustee, shall be the successor of
the Trustee hereunder; provided that such corporation shall be eligible under
Section 8.06 without the execution or filing of any paper or further act on the
part of any of the parties hereto, anything herein to the contrary
notwithstanding. In connection with the succession to the Trustee under this
Agreement by any Person (i) into which the Trustee may be merged or
consolidated, or (ii) which may be appointed as a successor to the Trustee, the
Trustee shall notify the Securities Administrator and the Depositor of such
succession or appointment and shall furnish to the Securities Administrator and
the Depositor in writing and in form and substance reasonably satisfactory to
the Securities Administrator and the Depositor, all information reasonably
necessary for the Securities Administrator to accurately and timely report,
pursuant to Section 8.12(g), the event under Item 6.02 of Form 8-K pursuant to
the Exchange Act (if such reports under the Exchange Act are required to be
filed under the Exchange Act).
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Section 8.10 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time,
for the purpose of meeting any legal requirements of any jurisdiction in which
any part of the Trust Fund or property securing any Mortgage Note may at the
time be located, the Servicer and the Trustee acting jointly shall have the
power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Trustee to act as co-trustee or co-trustees jointly with
the Trustee, or separate trustee or separate trustees, of all or any part of the
Trust Fund, and to vest in such Person or Persons, in such capacity and for the
benefit of the Certificateholders, such title to the Trust Fund or any part
thereof, whichever is applicable, and, subject to the other provisions of this
Section 8.10, such powers, duties, obligations, rights and trusts as the
Servicer and the Trustee may consider appropriate. If the Servicer shall not
have joined in such appointment within 15 days after the receipt by it of a
request to do so, or in the case an Event of Default shall have occurred and be
continuing, the Trustee alone shall have the power to make such appointment. No
co-trustee or separate trustee hereunder shall be required to meet the terms of
eligibility as a successor trustee under Section 8.06 and no notice to
Certificateholders of the appointment of any co-trustee or separate trustee
shall be required under Section 8.08.
Every separate trustee and co-trustee shall, to the extent permitted
by law, be appointed and act subject to the following provisions and conditions:
(a) To the extent necessary to effectuate the purposes of this Section
8.10, all rights, powers, duties and obligations conferred or imposed upon the
Trustee (except for the obligation of the Trustee as successor Master Servicer
under this Agreement to advance funds), shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or co-trustee is not
authorized to act separately without the Trustee joining in such act), except to
the extent that under any law of any jurisdiction in which any particular act or
acts are to be performed (whether as Trustee hereunder or as successor to the
Master Servicer hereunder), the Trustee shall be incompetent or unqualified to
perform such act or acts, in which event such rights, powers, duties and
obligations (including the holding of title to the applicable Trust Fund or any
portion thereof in any such jurisdiction) shall be exercised and performed
singly by such separate trustee or co-trustee, but solely at the direction of
the Trustee;
(b) No trustee hereunder shall be held personally liable because of
any act or omission of any other trustee hereunder and such appointment shall
not, and shall not be deemed to, constitute any such separate trustee or
co-trustee as agent of the Trustee;
(c) The Trustee may at any time accept the resignation of or remove
any separate trustee or co-trustee; and
(d) The Trust, and not the Master Servicer, shall be liable for the
payment of reasonable compensation and expenses to any such separate trustee or
co-trustee on each Distribution Date.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the separate trustees and co-trustees, when
and as effectively as if given to
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each of them. Every instrument appointing any separate trustee or co-trustee
shall refer to this Agreement and the conditions of this Article VIII. Each
separate trustee and co-trustee, upon its acceptance of the trusts conferred,
shall be vested with the estates or property specified in its instrument of
appointment, either jointly with the Trustee or separately, as may be provided
therein, subject to all the provisions of this Agreement, specifically including
every provision of this Agreement relating to the conduct of, affecting the
liability of, or affording protection and indemnity to, the Trustee. Every such
instrument shall be filed with the Trustee and a copy thereof given to the
Servicer and the Depositor.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.
Section 8.11 Tax Matters.
As set forth in the Preliminary Statement, the assets within the Trust
Fund for which any REMIC election is to be made shall constitute, and the
conduct of matters relating to such assets shall be consistent with the
treatment of such assets as, a REMIC. To this end, the Securities Administrator
covenants and agrees to act as agent (and the Securities Administrator is hereby
appointed to act as agent) on behalf of any REMIC created hereunder, and that in
such capacity it shall:
(a) prepare and file in a timely manner, a U.S. Real Estate Mortgage
Investment Conduit Income Tax Return (Form 1066 or any successor form adopted by
the Internal Revenue Service) and prepare and file with the Internal Revenue
Service and applicable state or local tax authorities income tax or information
returns for each taxable year with respect to any REMIC described in the
Preliminary Statement containing such information and at the times and in the
manner as may be required by the Code or state or local tax laws, regulations,
or rules, and furnish to Certificateholders the schedules, statements or
information at such times and in such manner as may be required thereby;
(b) within thirty days of the Closing Date, furnish to the Internal
Revenue Service on Form 8811 or as otherwise may be required by the Code, the
name, title, address, and telephone number of the person that the Holders of the
Certificates may contact for tax information relating thereto, together with
such additional information as may be required by such Form, and update such
information at the time or times in the manner required by the Code;
(c) make an election that each of REMIC I, REMIC II, REMIC III, REMIC
IV and REMIC V be treated as a REMIC on the federal tax return for its first
taxable year (and, if necessary, under applicable state law);
(d) prepare and forward to the Certificateholders and to the Internal
Revenue Service and, if necessary, state tax authorities, all information
returns and reports as and when required to be provided to them in accordance
with the REMIC Provisions, including the
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calculation of any original issue discount using the prepayment assumption (as
described in the Prospectus Supplement);
(e) provide information necessary for the computation of tax imposed
on the transfer of a Residual Certificate to a Person that is a Non-Permitted
Transferee, or an agent (including a broker, nominee or other middleman) of a
Non-Permitted Transferee, or a pass-through entity in which a Non-Permitted
Transferee is the record holder of an interest (the reasonable cost of computing
and furnishing such information may be charged to the Person liable for such
tax);
(f) to the extent that they are under its control, conduct matters
relating to such assets at all times that any Certificates are outstanding so as
to maintain the status of any REMIC created hereunder as a REMIC under the REMIC
Provisions;
(g) not knowingly or intentionally take any action or omit to take any
action that would cause the termination of the REMIC status of any REMIC created
hereunder;
(h) pay, from the sources specified in the last paragraph of this
Section 8.11, the amount of any federal or state tax, including prohibited
transaction taxes as described below, imposed on any REMIC created hereunder
before its termination when and as the same shall be due and payable (but such
obligation shall not prevent the Securities Administrator or any other
appropriate Person from contesting any such tax in appropriate proceedings and
shall not prevent the Securities Administrator from withholding payment of such
tax, if permitted by law, pending the outcome of such proceedings);
(i) cause federal, state or local income tax or information returns to
be signed by the Trustee or the Securities Administrator or such other person as
may be required to sign such returns by the Code or state or local laws,
regulations or rules;
(j) maintain records relating to each REMIC created hereunder,
including the income, expenses, assets, and liabilities thereof on a calendar
year basis and on the accrual method of accounting and the fair market value and
adjusted basis of the assets determined at such intervals as may be required by
the Code, as may be necessary to prepare the foregoing returns, schedules,
statements or information; and
The Holder of the largest Percentage Interest of the Class R
Certificates shall act as Tax Matters Person for REMIC I, REMIC II, REMIC III,
REMIC IV and REMIC V, within the meaning of Treasury regulations section
1.860F-4(d), and the Securities Administrator is hereby designated as agent of
such Certificateholder for such purpose (or if the Securities Administrator is
not so permitted, such Holder shall be the Tax Matters Person in accordance with
the REMIC Provisions). In such capacity, the Securities Administrator shall, as
and when necessary and appropriate, represent each REMIC created hereunder in
any administrative or judicial proceedings relating to an examination or audit
by any governmental taxing authority, request an administrative adjustment as to
any taxable year of each REMIC created hereunder, enter into settlement
agreements with any governmental taxing agency, extend any statute of
limitations relating to any tax item of any REMIC created hereunder, and
otherwise act on behalf of the REMIC in relation to any tax matter or
controversy involving it.
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The Securities Administrator shall treat the rights of the Class P
Certificateholders to Prepayment Charges as the beneficial ownership of
interests in a grantor trust, and not as an obligation of any REMIC created
hereunder, for federal income tax purposes.
To enable the Securities Administrator to perform its duties under
this Agreement, the Depositor shall provide to the Securities Administrator
within ten days after the Closing Date all information or data that the
Securities Administrator requests in writing and determines to be relevant for
tax purposes to the valuations and offering prices of the Certificates,
including the price, yield, prepayment assumption, and projected cash flows of
the Certificates and the Mortgage Loans. Moreover, the Depositor shall provide
information to the Securities Administrator concerning the value to each Class
of Certificates of the right to receive Basis Risk Carry Forward Amounts from
the Excess Reserve Fund Account and the Swap Account. Thereafter, the Depositor
shall provide to the Securities Administrator promptly upon written request
therefor any additional information or data that the Securities Administrator
may, from time to time, reasonably request to enable the Securities
Administrator to perform its duties under this Agreement. The Depositor hereby
indemnifies the Securities Administrator for any losses, liabilities, damages,
claims, or expenses of the Securities Administrator arising from any errors or
miscalculations of the Securities Administrator that result from any failure of
the Depositor to provide, or to cause to be provided, accurate information or
data to the Securities Administrator on a timely basis.
If any tax is imposed on "prohibited transactions" of any REMIC
created hereunder as defined in Section 860F(a)(2) of the Code, on the "net
income from foreclosure property" of such REMIC as defined in Section 860G(c) of
the Code, on any contribution to the REMIC after the Startup Day pursuant to
Section 860G(d) of the Code, or any other tax is imposed, including any minimum
tax imposed on the REMIC pursuant to Sections 23153 and 24874 of the California
Revenue and Taxation Code, if not paid as otherwise provided for herein, the tax
shall be paid by (i) the Master Servicer or the Securities Administrator if such
tax arises out of or results from negligence of the Securities Administrator in
the performance of any of its obligations under this Agreement, (ii) the
Servicer if such tax arises out of or results from a breach by the Servicer of
any of its obligations under this Agreement, (iii) the Unaffiliated Seller shall
pay if such tax arises out of or results from the Unaffiliated Seller's
obligation to repurchase a Mortgage Loan pursuant to Section 2.03, or (iv) in
all other cases, or if the Master Servicer, the Securities Administrator, the
Servicer or the Unaffiliated Seller fails to honor its obligations under the
preceding clauses (i), (ii) or (iii), any such tax will be paid with amounts
otherwise to be distributed to the Certificateholders, as provided in Section
4.02(a).
Section 8.12 Periodic Filings.
(a) The Securities Administrator, the Master Servicer and the Servicer
shall reasonably cooperate with the Depositor in connection with the reporting
requirements of the Trust under the Exchange Act. The Securities Administrator
shall prepare for execution by the Depositor any Forms 8-K, 10-D and 10-K
required by the Exchange Act and the rules and regulations of the Commission
thereunder, in order to permit the timely filing thereof, pursuant to the terms
of this Section 8.12, and the Securities Administrator shall file (via the
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Commission's Electronic Data Gathering and Retrieval System) such Forms executed
by the Depositor.
(b) The Securities Administrator shall compile all such information
provided to it in a Form 10-D prepared by it.
As set forth on Exhibit R hereto, by the related Distribution Date,
certain parties to this Agreement, within five (5) calendar days after the
related Distribution Date, shall be required to provide to the Securities
Administrator, in XXXXX compatible form, or in such other form as agreed upon by
the Securities Administrator and such party and shall be required to provide to
the Securities Administrator and the Depositor, to the extent known by such
additional parties, any additional information required to be disclosed on Form
10-D ("Additional Form 10-D Disclosure"), if applicable and the Depositor will
approve, as to form and substance, or disapprove, as the case may be, the
inclusion of the Additional Form 10-D Disclosure. Within 10 days after each
Distribution Date (subject to permitted extensions under the Exchange Act), the
Securities Administrator shall prepare and provide to the Depositor for approval
on behalf of the Trust any Form 10-D required by the Exchange Act, in form and
substance as required by the Exchange Act, including, without limitation the
Additional Form 10-D Disclosure, as applicable. The Securities Administrator
will have no duty or liability for any failure hereunder to determine or prepare
any Additional Form 10-D Disclosure, except as set forth in the next paragraph.
(c) Each 10-D filing prepared by the Securities Administrator shall be
submitted to the Depositor for approval no later than the fifth calendar day
preceding the filing deadline for such 10-D filing. Upon receipt of written
notice via electronic mail from the Depositor that the 10-D has been approved,
the Securities Administrator shall submit such 10-D for filing with the
commission. If a Form 10-D cannot be filed on time or if a previously filed Form
10-D needs to be amended, the Securities Administrator will follow the
procedures set forth in Section 8.12(f)(ii). The signing party at the Depositor
can be contacted at 0000 Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx, 00000, or
such other address as to which the Depositor has provided prior written notice
to the Securities Administrator. The Depositor, the Master Servicer and the
Servicer acknowledge that the performance by the Securities Administrator of its
duties under this Section 8.12(c) related to the timely preparation and filing
of Form 10-D is contingent upon the Servicer, the Master Servicer and the
Depositor and any other Person obligated to provide Additional Form 10-D
Disclosure as set forth on Exhibit R hereto observing all applicable deadlines
in the performance of their duties under this Section 8.12(c). The Securities
Administrator shall have no liability for any loss, expense, damage, or claim
arising out of or with respect to any failure to properly prepare and/or timely
file such Form 10-D, where such failure results from the Securities
Administrator's inability or failure to obtain or receive, on a timely basis,
any information or signatures from any party hereto (other than the Securities
Administrator or any Subcontractor utilized by the Securities Administrator)
needed to prepare, arrange for execution or file such Form 10-D, not resulting
from its own negligence, bad faith or willful misconduct. The Depositor shall be
responsible for reasonable fees and expenses assessed or incurred by the
Securities Administrator in connection with the preparation of such Form 10-D.
Promptly (but no later than one Business Day) after filing with the SEC, the
Securities Administrator will make available on its internet website a final
executed copy of each Form 10-D prepared and filed by the Securities
Administrator.
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Form 10-D requires the registrant to indicate (by checking "yes" or
"no") that it (1) has filed all reports required to be filed by Section 13 and
15(d) of the Exchange Act during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. The Depositor shall
notify the Securities Administrator in writing, no later than the fifth calendar
day after the related Distribution Date with respect to the filing of a report
on Form 10-D if the answer to the questions should be "no".
Within 90 days after the end of each fiscal year of the Trust or such
earlier date as may be required by the Exchange Act (the "10-K Filing
Deadline"), commencing in March 2008, the Securities Administrator shall prepare
and file on behalf of the Trust a Form 10-K, in form and substance as required
by the Exchange Act. Each such Form 10-K shall include the following items, in
each case to the extent they have been delivered to the Securities Administrator
within the applicable time frames set forth in this Agreement, (i) an annual
compliance statement for the Servicer, the Master Servicer and each Subservicer
engaged by the Servicer or the Master Servicer, as described under Section 3.22,
(ii)(A) the annual reports on assessment of compliance with servicing criteria
for the Securities Administrator, the Servicer, the Master Servicer, each
Subservicer engaged by the Servicer and each Servicing Function Participant
utilized by the Servicer, the Master Servicer or the Securities Administrator,
as described under Section 3.23, and (B) if any such report on assessment of
compliance with servicing criteria described under Section 3.23 identifies any
material instance of noncompliance, disclosure identifying such instance of
noncompliance, or such report on assessment of compliance with servicing
criteria described under Section 3.23 is not included as an exhibit to such Form
10-K, disclosure that such report is not included, (iii)(A) the registered
public accounting firm attestation report for the Securities Administrator, the
Servicer, the Master Servicer, each Subservicer engaged by the Servicer and each
Servicing Function Participant utilized by the Servicer, the Master Servicer or
the Securities Administrator, as described under Section 3.23, and (B) if any
registered public accounting firm attestation report described under Section
3.23 identifies any material instance of noncompliance, disclosure identifying
such instance of noncompliance, or if any such registered public accounting firm
attestation report is not included as an exhibit to such Form 10-K, disclosure
that such report is not included, and (iv) a certification in the form attached
hereto as Exhibit M, with such changes as may be necessary or appropriate as a
result of changes promulgated by the Commission (the "Sarbanes Certification"),
which shall be signed by the officer of the Depositor in charge of
securitization. Any disclosure or information in addition to (i) through (iv)
above that is required to be included on Form 10-K ("Additional Form 10-K
Disclosure") shall be delivered to the Securities Administrator by the
Depositor. Pursuant to the following paragraph, the Securities Administrator
will have no duty or liability for any failure hereunder to determine or prepare
any Additional Form 10-K Disclosure, except as set forth in the next paragraph.
All materials delivered to the Securities Administrator for purposes
of this Section 8.12 shall be provided in electronic format compatible with the
XXXXX system. As set forth on Exhibit S hereto, no later than March 1st of each
year that the Trust is subject to the Exchange Act reporting requirements,
commencing in 2008, certain parties to this Agreement shall be required to
provide to the Securities Administrator and the Depositor, to the extent known
by such applicable parties, any Additional Form 10-K Disclosure, which is
identified as such, if applicable. The Securities Administrator shall compile
all such information provided to it in a
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Form 10-K prepared by it. The Depositor will review the Additional Form 10-K
Disclosure and either approve or disapprove the information and inclusion. The
Depositor shall be responsible for reasonable fees and expenses assessed or
incurred by the Securities Administrator in connection with the preparation of
such Additional Form 10-K Disclosure.
After preparing the Form 10-K, the Securities Administrator shall
forward electronically a draft copy of the Form 10-K to the Depositor for
review. On the 3rd Business Day prior to the 10-K Filing Deadline, an officer of
the Depositor shall sign the Form 10-K and return an electronic or fax copy of
such signed Form 10-K (with an original executed hard copy to follow by
overnight mail) to the Securities Administrator. If a Form 10-K cannot be filed
on time or if a previously filed Form 10-K needs to be amended, the Securities
Administrator will follow the procedures set forth in Section 8.12(f)(ii). The
signing party at the Depositor can be contacted at 0000 Xxxxxxxx, 00xx Xxxxx,
Xxx Xxxx, Xxx Xxxx, 00000, or such other address as to which the Depositor has
provided prior written notice to the Securities Administrator. The Depositor,
the Servicer and the Master Servicer acknowledge that the performance by the
Securities Administrator of its duties under this Section 8.12(c) related to the
timely preparation and filing of Form 10-K is contingent upon the Servicer, the
Master Servicer (and any Subservicer or Servicing Function Participant engaged
by the Servicer) and the Depositor and any other Person obligated to provide
Additional Form 10-K Disclosure as set forth on Exhibit R hereto, observing all
applicable deadlines in the performance of their duties under this Section
8.12(c), Section 8.12(e), Section 3.22 and Section 3.23. The Securities
Administrator shall have no liability for any loss, expense, damage or claim
arising out of or with respect to any failure to properly prepare and/or timely
file such Form 10-K, where such failure results from the Securities
Administrator's inability or failure to obtain or receive, on a timely basis,
any information or signatures from any party hereto (other than the Securities
Administrator or any Subcontractor utilized by the Securities Administrator)
needed to prepare, arrange for execution or file such Form 10-K, not resulting
from its own negligence, bad faith or willful misconduct. Promptly (but no later
than on Business Day) after filing with the SEC, the Securities Administrator
will make available on its internet website a final executed copy of each Form
10-K prepared and filed by the Securities Administrator.
Form 10-K requires the registrant to indicate (by checking "yes" or
"no") that it (1) has filed all reports required to be filed by Section 13 and
15(d) of the Exchange Act during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. The Depositor shall
notify the Securities Administrator in writing, no later than the fifth calendar
day after the related Distribution Date with respect to the filing of a report
on Form 10-K if the answer to the questions should be "no".
(d) In connection with the execution of a Sarbanes Certification, the
Securities Administrator shall sign a certification (in the form attached hereto
as Exhibit O, with such changes as may be necessary or appropriate as a result
of changes promulgated by the Commission) for the benefit of the Depositor and
its officers and directors and the Master Servicer and the Servicer shall sign a
certification solely with respect to the Master Servicer or the Servicer, as the
case may be, (in the form attached hereto as Exhibit N, with such changes as may
be necessary or appropriate as a result of changes promulgated by the
Commission) for the benefit of the Depositor, the Securities Administrator and
their respective officers, directors and
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Affiliates. Each such certification shall be delivered to the Depositor no later
than March 15th of each year (or if such day is not a Business Day, the
immediately following Business Day) and the Depositor shall deliver the Sarbanes
Certification no later than the time set forth for the delivery to the
Securities Administrator of the signed Form 10-K pursuant to Section 8.12(e) for
such year). In the event that prior to the filing date of the Form 10-K in March
of each year, a Responsible Officer of the Securities Administrator, the Master
Servicer or the Servicer has actual knowledge of information material to the
Sarbanes Certification, that party shall promptly notify the Depositor and each
of the other parties signing the certifications. In addition, (i) the Securities
Administrator shall indemnify and hold harmless the Depositor and its officers,
directors, employees, agents and Affiliates from and against any losses,
damages, penalties, fines, forfeitures, reasonable and necessary legal fees and
related costs, judgments and other costs and expenses arising out of or based
upon any breach of the Securities Administrator's obligations under this Section
8.12(d) or the Securities Administrator's negligence, bad faith or willful
misconduct in connection therewith, (ii) the Servicer, severally and not
jointly, shall indemnify and hold harmless the Depositor, the Securities
Administrator, the Master Servicer and their respective officers, directors,
employees, agents and Affiliates from and against any losses, damages,
penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments and other costs and expenses arising out of or based upon any
breach of the Servicer's obligations under this Section 8.12(d) or any
negligence, bad faith or willful misconduct of the Servicer in connection
therewith, and (iii) the Master Servicer shall indemnify and hold harmless the
Depositor, the Securities Administrator and their respective officers,
directors, employees, agents and Affiliates from and against any losses,
damages, penalties, fines, forfeitures, reasonable and necessary legal fees and
related costs, judgments and other costs and expenses arising out of or based
upon any breach of the Servicer's obligations under this Section 8.12(d) or any
negligence, bad faith or willful misconduct of the Servicer in connection
therewith. If the indemnification provided for herein is unavailable or
insufficient to hold harmless any indemnified party, then (i) the Securities
Administrator agrees in connection with a breach of the Securities
Administrator's obligations under this Section 8.12(d) or the Securities
Administrator's negligence, bad faith or willful misconduct in connection
therewith that it shall contribute to the amount paid or payable by the
Depositor as a result of the losses, claims, damages or liabilities of the
Depositor in such proportion as is appropriate to reflect the relative fault of
the Depositor on the one hand and the Securities Administrator on the other and
(ii) the Servicer agrees that it shall contribute to the amount paid or payable
by such indemnified party as a result of the losses, claims, damages or
liabilities of such indemnified party in such proportion as is appropriate to
reflect the relative fault of such indemnified party, on the one hand, and the
Servicer, on the other hand, in connection with a breach of the Servicer's
obligations under this Section 8.12(d) or any material misstatement or omission,
negligence, bad faith or willful misconduct of the Servicer in connection
therewith.
(e) Upon any filing with the Commission, the Securities Administrator
shall promptly notify the Depositor of such filing.
(f) (i) The obligations set forth in paragraphs (a) through (e) of
this Section shall only apply with respect to periods for which reports are
required to be filed with respect to the Trust under the Exchange Act. Prior to
January 30 of the first year in which the Securities Administrator is able to do
so under applicable law, the Securities Administrator shall file a Form 15
Suspension Notification with respect to the Trust, with a copy to the Depositor.
At any
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time after the filing of a Form 15 Suspension Notification, if the number of
Holders of the Offered Certificates of record exceeds the number set forth in
Section 15(d) of the Exchange Act or the regulations promulgated pursuant
thereto which would cause the Trust to again become subject to the reporting
requirements of the Exchange Act, the Securities Administrator shall, solely at
the written direction and expense of the Depositor, recommence preparing and
filing reports on Form 10-K, 10-D and 8-K as required pursuant to this Section
8.12 and the parties hereto shall again have the obligations set forth in this
Section.
(ii) In the event that the Securities Administrator is unable to
timely file with the Commission all or any required portion of any Form 8-K,
10-D or 10-K required to be filed pursuant to this Agreement because required
disclosure information was either not delivered to it or delivered to it after
the delivery deadlines set forth in this Agreement, the Securities Administrator
will immediately notify the Depositor and, to the extent affected thereby, the
Servicer and the Master Servicer. In the case of Form 10-D and 10-K, the
Depositor, the Servicer, the Master Servicer and Securities Administrator will
thereupon cooperate to prepare and file a Form 12b-25 and a 10-DA and 10-KA as
applicable, pursuant to Rule 12b-25 of the Exchange Act. In the case of Form
8-K, the Securities Administrator will, upon receipt of all disclosure
information required to be included on Form 8-K, include such disclosure
information on the next Form 10-D. In the event that any previously filed Form
8-K, 10-D or 10-K needs to be amended, the party to this Agreement deciding that
an amendment to such Form 8-K, 10-D or 10-K is required will notify the
Depositor, the Securities Administrator and, to the extent affected thereby,
and, to the extent affected thereby, the Servicer and the Master Servicer and
such parties will cooperate to prepare any necessary Form 8-KA, 10-DA or 10-KA.
Any Form 15, Form 12b-25 or any amendment to Form 8-K, 10-D or 10-K shall be
signed by an officer of the Depositor. The Depositor, the Master Servicer and
Servicer acknowledge that the performance by the Securities Administrator of its
duties under this Section 8.12(f) related to the timely preparation and filing
of Form 15, a Form 12b-25 or any amendment to Form 8-K, 10-D or 10-K is
contingent upon the Master Servicer, the Servicer and the Depositor observing
all applicable deadlines in the performance of their duties under this Section
8.12 and Sections 3.22 and 3.23. The Securities Administrator shall have no
liability for any loss, expense, damage, claim arising out of or with respect to
any failure to properly prepare and/or timely file any such Form 15, Form 12b-25
or any amendments to Forms 8-K, 10-D or 10-K, where such failure results from
the Securities Administrator's inability or failure to obtain or receive, on a
timely basis, any information or signatures from any party hereto (other than
the Securities Administrator or any Subcontractor utilized by the Securities
Administrator) needed to prepare, arrange for execution or file such Form 15,
Form 12b-25 or any amendments to Forms 8-K, 10-D or 10-K, not resulting from its
own negligence, bad faith or willful misconduct.
(g) Within four (4) Business Days after the occurrence of an event
requiring disclosure on Form 8-K (each such event, a "Reportable Event"), solely
upon the prior written request and at the expense of the Depositor, the
Securities Administrator shall prepare and file on behalf of the Trust any Form
8-K, as required by the Exchange Act, provided that the Depositor shall file the
initial Form 8-K in connection with the issuance of the Certificates. Any
disclosure or information related to a Reportable Event or that is otherwise
required to be included on Form 8-K ("Form 8-K Disclosure Information") shall be
prepared by the party responsible for preparing such disclosure as set forth on
Exhibit T hereto and compiled by the Securities Administrator at the direction
of the Depositor pursuant to the following paragraph and the
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Securities Administrator will have no duty or liability for any failure
hereunder to determine or prepare any Form 8-K Disclosure Information or any
Form 8-K, except as set forth in the next paragraph. The Depositor will approve,
as to form and substance, or disapprove, as the case may be, the inclusion of
the Form 8-K Disclosure Information. The Depositor shall be responsible for
reasonable fees and expenses assessed or incurred by the Securities
Administrator in connection with the preparation of such Form 8-K Disclosure
Information.
As set forth on Exhibit T hereto, for so long as the Trust is subject
to the Exchange Act reporting requirements, no later than the end of business on
the 2nd Business Day after the occurrence of a Reportable Event, certain parties
to this Agreement shall be required to provide to the Depositor and the
Securities Administrator, to the extent known by such applicable parties, any
Form 8-K Disclosure Information which shall be identified as such, if
applicable. The Securities Administrator shall compile all such information
provided to it in a Form 8-K prepared by it.
After preparing the Form 8-K, the Securities Administrator shall
forward electronically a draft copy of the Form 8-K to the Depositor for review.
No later than 12:00 noon on the 4th Business Day after the Reportable Event, an
officer of the Depositor shall sign the Form 8-K and return an electronic or fax
copy of such signed Form 8-K (with an original executed hard copy to follow by
overnight mail) to the Securities Administrator. If a Form 8-K cannot be filed
on time or if a previously filed Form 8-K needs to be amended, the Securities
Administrator will follow the procedures set forth in Section 8.12(f)(ii).
Promptly (but in any case within one Business Day) after filing with the
Commission, the Securities Administrator will, make available on its internet
website a final executed copy of each Form 8-K prepared and filed by the
Securities Administrator. The signing party at the Depositor can be contacted at
0000 Xxxxxxxx, Xxx Xxxx, XX 00000, Attention: Xxxxx Xxxxxxx, or such other
address as to which the Depositor has provided prior written notice to the
Securities Administrator. The Depositor, the Master Servicer and the Servicer
acknowledge that the performance by the Securities Administrator of its duties
under this Section 8.12(g) related to the timely preparation and filing of Form
8-K is contingent upon the Master Servicer, the Servicer and the Depositor and
any other Person obligated to proved Form 8-K Disclosure Information as set
forth on Exhibit T hereto, observing all applicable deadlines in the performance
of their duties under this Section 8.12(g). The Securities Administrator shall
have no liability for any loss, expense, damage or claim arising out of or with
respect to any failure to properly prepare and/or timely file such Form 8-K,
where such failure results from the Securities Administrator's inability or
failure to obtain or receive, on a timely basis, any information or signatures
from any party hereto (other than the Securities Administrator or any
Subcontractor utilized by the Securities Administrator) needed to prepare,
arrange for execution or file such Form 8-K, not resulting from its own
negligence, bad faith or willful misconduct.
(h) The Securities Administrator shall have no liability for any loss,
expense, damage or claim arising out of or resulting from (i) the accuracy or
inaccuracy of any Additional Form 10-D Disclosure, Additional Form 10-K
Disclosure or Form 8-K Disclosure Information (excluding any information therein
provided by the Securities Administrator or any Subcontractor utilized by the
Securities Administrator) provided to the Securities Administrator in connection
with the preparation of Forms 10-D, 10-K and 8-K pursuant to this Section 8.12,
or (ii) the failure of the Depositor to approve for filing any Forms 10-D, 10-K
and 8-K required to
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be prepared by the Securities Administrator pursuant to this Section 8.12, in
either case, not resulting from the Securities Administrator's own negligence,
bad faith or misconduct.
(i) To the extent no notice is provided to the Securities
Administrator as described in this section 8.12 of events or in formation set
forth in this section 8.12, the Securities Administrator shall, without further
notice, conclude that there is no event or information to be reported pursuant
to this Section 8.12.
Section 8.13 Tax Classification of the Supplemental Interest Trust,
the Excess Reserve Fund Account and the Swap Account.
For federal income tax purposes, the Securities Administrator shall
treat each of the Supplemental Interest Trust, the Excess Reserve Fund Account
and the Swap Account as an outside reserve fund, within the meaning of Treasury
Regulation Section 1.860G-2(h), that is beneficially owned by the holder of the
Class X Certificate. The Securities Administrator shall treat the rights that
each Class of LIBOR Certificates has to receive payments of Basis Risk Carry
Forward Amounts from the Excess Reserve Fund Account and the Swap Account as
rights to receive payments under a notional principal contract written by the
Class X Certificateholder in favor of each Class. Accordingly, each Class of
Certificates (excluding the Class X, Class P and Class R Certificates) will be
comprised of two components - a REMIC V Regular Interest and an interest in a
notional principal contract. The Securities Administrator shall allocate the
issue price for a Class of Certificates between such two components for purposes
of determining the issue price of the REMIC V Regular Interest component based
on information received from the Depositor.
Section 8.14 Interest Rate Swap Agreement.
The Securities Administrator is hereby authorized and directed to
execute and deliver the Interest Rate Swap Agreement not in its individual
capacity but solely on behalf of the Supplemental Interest Trust of the Trust
and to acknowledge the provisions thereof. The Securities Administrator is
directed to administer the Interest Rate Swap Agreement in accordance with the
terms thereof and hereof. The Securities Administrator shall not enter into any
amendment to the Interest Rate Swap Agreement other than pursuant to the terms
thereof. In the event that the Swap Provider fails to make a payment as required
pursuant to the Interest Rate Swap Agreement, the Securities Administrator shall
make a demand for such payment from the guarantor of the Interest Rate Swap
Agreement.
Section 8.15 Interest Rate Cap Agreement.
The Securities Administrator is hereby authorized and directed to
execute and deliver the Interest Rate Cap Agreement not in its individual
capacity but solely on behalf of the Supplemental Interest Trust of the Trust
and to acknowledge the provisions thereof. The Securities Administrator is
directed to administer the Interest Rate Cap Agreement in accordance with the
terms thereof and hereof. The Securities Administrator shall not enter into any
amendment to the Interest Rate Cap Agreement other than pursuant to the terms
thereof. In the event that the Cap Provider fails to make a payment as required
pursuant to the Interest Rate Cap
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Agreement, the Securities Administrator shall make a demand for such payment
from the guarantor of the Interest Rate Cap Agreement.
ARTICLE IX
ADMINISTRATION OF THE MORTGAGE LOANS
BY THE MASTER SERVICER
Section 9.01 Duties of the Master Servicer; Enforcement of the
Servicer's Obligations. (a) In addition to the other duties of the Master
Servicer set forth in this Agreement, the Master Servicer, on behalf of the
Trustee, the Securities Administrator, the Depositor and the Certificateholders,
shall monitor the performance of the Servicer under this Agreement (other than
in connection with defaulted or REO Properties), and (except as set forth below)
shall use its reasonable good faith efforts to cause the Servicer to duly and
punctually perform their duties and obligations hereunder as applicable. Upon
the occurrence of an Event of Default of which a Responsible Officer of the
Master Servicer has actual knowledge, the Master Servicer shall promptly notify
the Securities Administrator and the Trustee and shall specify in such notice
the action, if any, the Master Servicer plans to take in respect of such
default. So long as an Event of Default shall occur and be continuing, the
Master Servicer shall take the actions specified in Article VII.
(b) The Master Servicer shall bear the costs of monitoring the
Servicer as required hereunder. The costs associated with (i) termination of the
Servicer, (ii) the appointment of a successor Servicer or (iii) the transfer to
and assumption of, the servicing by the Master Servicer shall be paid by the
terminated Servicer. In the event the full costs associated with the transition
of servicing responsibilities to the Master Servicer are not paid for by the
predecessor or successor Servicer (provided such successor Servicer is not the
Master Servicer), such costs shall be paid by the Trust.
(c) If the Master Servicer assumes the servicing with respect to any
of the Mortgage Loans, it will not assume liability for the representations and
warranties of the Servicer it replaces or for any errors or omissions of the
Servicer.
(d) Neither the Depositor nor the Securities Administrator shall
consent to the assignment by the Servicer of the Servicer's rights and
obligations under the Agreement without the prior written consent of the Master
Servicer and the Depositor, which consent, in the case of the Depositor, shall
not be unreasonably withheld.
Section 9.02 Maintenance of Fidelity Bond and Errors and Omissions
Insurance. (a) The Master Servicer, at its expense, shall maintain in effect a
blanket fidelity bond and an errors and omissions insurance policy, affording
coverage with respect to all directors, officers, directors, employees and other
Persons acting on such Master Servicer's behalf, and covering errors and
omissions in the performance of the Master Servicer's obligations hereunder. The
errors and omissions insurance policy and the fidelity bond shall be in such
form and amount generally acceptable for entities serving as master servicers or
trustees.
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Section 9.03 Representations and Warranties of the Master Servicer.
(a) The Master Servicer hereby represents and warrants to the Depositor, the
Securities Administrator and the Trustee, for the benefit of the
Certificateholders, as of the Closing Date that:
(i) it is a banking association organized under the laws of the
United States of America, validly existing and in good standing under the
laws of the United States of America, and as Master Servicer has full power
and authority to transact any and all business contemplated by this
Agreement and to execute, deliver and comply with its obligations under the
terms of this Agreement, the execution, delivery and performance of which
have been duly authorized by all necessary corporate action on the part of
the Master Servicer;
(ii) the execution and delivery of this Agreement by the Master
Servicer and its performance and compliance with the terms of this
Agreement will not (A) violate the Master Servicer's charter or bylaws, (B)
violate any law or regulation or any administrative decree or order to
which it is subject or (C) constitute a default (or an event which, with
notice or lapse of time, or both, would constitute a default) under, or
result in the breach of, any material contract, agreement or other
instrument to which the Master Servicer is a party or by which it is bound
or to which any of its assets are subject, which violation, default or
breach would materially and adversely affect the Master Servicer's ability
to perform its obligations under this Agreement;
(iii) this Agreement constitutes, assuming due authorization,
execution and delivery hereof by the other respective parties hereto, a
legal, valid and binding obligation of the Master Servicer, enforceable
against it in accordance with the terms hereof, except as such enforcement
may be limited by bankruptcy, insolvency, reorganization, moratorium and
other laws affecting the enforcement of creditors' rights in general, and
by general equity principles (regardless of whether such enforcement is
considered in a proceeding in equity or at law);
(iv) the Master Servicer is not in default with respect to any
order or decree of any court or any order or regulation of any federal,
state, municipal or governmental agency to the extent that any such default
would materially and adversely affect its performance hereunder;
(v) the Master Servicer is not a party to or bound by any
agreement or instrument or subject to any charter provision, bylaw or any
other corporate restriction or any judgment, order, writ, injunction,
decree, law or regulation that may materially and adversely affect its
ability as Master Servicer to perform its obligations under this Agreement
or that requires the consent of any third person to the execution of this
Agreement or the performance by the Master Servicer of its obligations
under this Agreement;
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(vi) no litigation is pending or, to the best of the Master
Servicer's knowledge, threatened against the Master Servicer which would
prohibit its entering into this Agreement or performing its obligations
under this Agreement;
(vii) [Reserved];
(viii) no consent, approval, authorization or order of any court
or governmental agency or body is required for the execution, delivery and
performance by the Master Servicer of or compliance by the Master Servicer
with this Agreement or the consummation of the transactions contemplated by
this Agreement, except for such consents, approvals, authorizations and
orders (if any) as have been obtained; and
(ix) the consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Master Servicer.
(b) It is understood and agreed that the representations and
warranties set forth in this Section shall survive the execution and delivery of
this Agreement. The Master Servicer shall indemnify the Depositor, Securities
Administrator, the Trustee and the Trust and hold them harmless against any
loss, damages, penalties, fines, forfeitures, reasonable legal fees and related
costs, judgments, and other reasonable costs and expenses resulting from any
claim, demand, defense or assertion based on or grounded upon, or resulting
from, a material breach of the Master Servicer's representations and warranties
contained in Section 9.03(a) above. It is understood and agreed that the
enforcement of the obligation of the Master Servicer set forth in this Section
9.03 to indemnify the Depositor, Securities Administrator, the Trustee and the
Trust constitutes the sole remedy of the Depositor and the Trustee, respecting a
breach of the foregoing representations and warranties. Such indemnification
shall survive any termination of the Master Servicer as Master Servicer
hereunder and any termination of this Agreement.
Any cause of action against the Master Servicer relating to or arising
out of the breach of any representations and warranties made in this Section
shall accrue upon discovery of such breach by either the Depositor, the Master
Servicer, Securities Administrator or the Trustee or notice thereof by any one
of such parties to the other parties.
Section 9.04 Master Servicer Events of Default. Each of the following
shall constitute a "Master Servicer Event of Default":
(a) any failure by the Master Servicer to remit to the Securities
Administrator for deposit in the Distribution Account any payment received by it
from the Servicer or required to be made by the Master Servicer 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 Master Servicer by any other
party hereto;
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(b) failure by the Master Servicer to duly observe or perform, in any
material respect, any other covenants, obligations or agreements of the Master
Servicer as set forth in this Agreement which failure 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 Master
Servicer by the Trustee or to the Master Servicer and Trustee by the holders of
Certificates evidencing at least 25% of the Voting Rights;
(c) 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, bankruptcy, readjustment of debt, marshaling of
assets and liabilities or similar proceedings, or for the winding-up or
liquidation of its affairs, shall have been entered against the Master Servicer
and such decree or order shall have remained in force, undischarged or unstayed
for a period of sixty (60) days;
(d) the Master Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, bankruptcy,
readjustment of debt, marshaling of assets and liabilities or similar
proceedings of or relating to the Master Servicer or relating to all or
substantially all of its property;
(e) the Master Servicer shall admit in writing its inability to pay
its debts as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for the
benefit of its creditors, or voluntarily suspend payment of its obligations for
three (3) Business Days;
(f) Except as otherwise set forth herein, the Master Servicer attempts
to assign this Agreement or its responsibilities hereunder or to delegate its
duties hereunder (or any portion thereof) without the consent of the Trustee,
Securities Administrator and the Depositor; or
(g) the indictment of the Master Servicer for the taking of any action
by the Master Servicer, any employee thereof, any Affiliate or any director or
employee thereof that constitutes fraud or criminal activity in the performance
of its obligations under this Agreement, in each case, where such indictment
materially and adversely affects the ability of the Master Servicer to perform
its obligations under this Agreement (subject to the condition that such
indictment is not dismissed within ninety (90) days).
In each and every such case, so long as a Master Servicer Event of
Default shall not have been remedied, in addition to whatever rights the
Securities Administrator may have at law or equity to damages, including
injunctive relief and specific performance, the Securities Administrator, by
notice in writing to the Master Servicer may, and at the direction of the
Holders of Certificates representing at least 51% of the Voting Rights, shall,
terminate with cause all the rights and obligations of the Master Servicer under
this Agreement.
Upon receipt by the Master Servicer of such written notice, all
authority and power of the Master Servicer under this Agreement, shall pass to
and be vested in any successor master servicer appointed hereunder which accepts
such appointments. Upon written request from the Trustee or the Depositor, the
Master Servicer shall prepare, execute and deliver to the
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successor entity designated by the Trustee any and all documents and other
instruments related to the performance of its duties hereunder as the Master
Servicer and place in such successor's possession all such documents with
respect to the master servicing of the Mortgage Loans and do or cause to be done
all other acts or things necessary or appropriate to effect the purposes of such
notice of termination, at the Master Servicer's sole expense. The Master
Servicer shall cooperate with the Trustee and such successor master servicer in
effecting the termination of the Master Servicer's responsibilities and rights
hereunder, including without limitation, the transfer to such successor master
servicer for administration by it of all cash amounts which shall at the time be
credited to the Distribution Account or are thereafter received with respect to
the Mortgage Loans.
Section 9.05 Waiver of Default. By a written notice, the Trustee may,
with the consent of a Holders of Certificates evidencing at least 51% of the
Voting Rights waive any default by the Master Servicer 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 Master Servicer 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.
Section 9.06 Successor to the Master Servicer. Upon termination of the
Master Servicer's responsibilities and duties under this Agreement, the Trustee
shall appoint a successor, which shall succeed to all rights and assume all of
the responsibilities, duties and liabilities of the Master Servicer under this
Agreement, except liabilities incurred by the terminated Master Servicer (unless
such terminated Master Servicer is the Trustee) for which the terminated Master
Servicer shall still be responsible. Any successor shall be a Xxxxxx Mae and
Xxxxxxx Mac approved servicer in good standing and acceptable to the Depositor
and the Rating Agencies. In connection with such appointment and assumption, the
Trustee may make such arrangements for the compensation of such successor out of
payments on Mortgage Loans as it and such successor shall agree; provided,
however, that in no event shall the master servicing fee paid to such successor
master servicer exceed the Securities Administrator and Master Servicer Fee paid
to the Master Servicer hereunder. In the event that the Master Servicer's
duties, responsibilities and liabilities under this Agreement are terminated,
the Master Servicer shall continue to discharge its duties and responsibilities
hereunder until the effective date of such termination 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 of
its successor. The termination of the Master Servicer shall not become effective
until a successor shall be appointed pursuant hereto and shall in no event (i)
relieve the Master Servicer of responsibility for the representations and
warranties made pursuant to Section 9.03(a) hereof and the remedies available to
the Trustee under Section 9.03(b) hereof, it being understood and agreed that
the provisions of Section 9.03 hereof shall be applicable to the Master Servicer
notwithstanding any such sale, assignment, resignation or termination of the
Master Servicer or the termination of this Agreement; or (ii) affect the right
of the Master Servicer to receive payment and/or reimbursement of any amounts
accruing to it hereunder prior to the date of termination (or during any
transition period in which the Master Servicer continues to perform its duties
hereunder prior to the date the successor master servicer fully assumes its
duties).
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If no successor Master Servicer has accepted its appointment within 90
days of the time the Trustee receives the resignation of the Master Servicer,
the Trustee shall become the successor Master Servicer in all respects under
this Agreement until another successor Master Servicer is appointed, and shall
have all the rights and powers and be subject to all the responsibilities,
duties and liabilities, except liabilities incurred by the terminated Master
Servicer (unless such terminated Master Servicer is the Trustee) for which the
terminated Master Servicer shall still be responsible, including the obligation
to make P&I Advances; provided, however, that any failure to perform any duties
or responsibilities caused by the Master Servicer's failure to provide
information required by this Agreement shall not be considered a default by the
Trustee hereunder. In the Trustee's capacity as such successor Master Servicer,
the Trustee shall have the same limitations on liability herein granted to the
Master Servicer. As compensation therefor, the Trustee shall be entitled to
receive the compensation, reimbursement and indemnities otherwise payable to the
Master Servicer, including the fees and other amounts payable pursuant to
Section 9.07 hereof.
Any successor master servicer appointed as provided herein, shall
execute, acknowledge and deliver to the predecessor Master Servicer and to the
Trustee an instrument accepting such appointment, wherein the successor shall
make the representations and warranties set forth in Section 9.03 hereof, and
whereupon such successor shall become fully vested with all of the rights,
powers, duties, responsibilities, obligations and liabilities of the Master
Servicer, with like effect as if originally named as a party to this Agreement.
Any termination or resignation of the Master Servicer or termination of this
Agreement shall not affect any claims that the Trustee may have against the
Master Servicer arising out of the Master Servicer's actions or failure to act
prior to any such termination or resignation or in connection with the Trustee's
assumption of such obligations, duties and responsibilities.
Upon a successor's acceptance of appointment as such, the Master
Servicer shall notify by mail the Trustee of such appointment.
Section 9.07 Compensation of the Master Servicer. As compensation for
its activities under this Agreement, the Master Servicer shall be paid the
Securities Administrator and Master Servicer Fee.
Section 9.08 Merger or Consolidation. Any Person into which the Master
Servicer may be merged or consolidated, or any Person resulting from any merger,
conversion, other change in form or consolidation to which the Master Servicer
shall be a party, or any Person succeeding to the business of the Master
Servicer, shall be the successor to the Master Servicer 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 successor or resulting Person to the Master Servicer shall (i)
be a Person (or have an Affiliate) that is qualified and approved to service
mortgage loans for Xxxxxx Xxx and FHLMC (provided further that a successor
Master Servicer that satisfies subclause (i) through an Affiliate agrees to
service the Mortgage Loans in accordance with all applicable Xxxxxx Mae and
FHLMC guidelines) and (ii) have a net worth of not less than $25,000,000. In
connection with the succession to the Master Servicer under this Agreement by
any Person (i) into which the Master Servicer may be merged or consolidated, or
(ii) which may be appointed as a successor to the Master Servicer, the Master
Servicer shall notify the Securities Administrator and the Depositor
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of such succession or appointment and shall furnish to the Securities
Administrator and the Depositor, all information reasonably necessary for the
Securities Administrator to accurately and timely report, pursuant to Section
8.12(g), the event under Item 6.02 of Form 8-K pursuant to the Exchange Act (if
such reports under the Exchange Act are required to be filed under the Exchange
Act).
Section 9.09 Resignation of the Master Servicer. Except as otherwise
provided in Sections 9.08 and 9.10 hereof, the Master Servicer shall not resign
from the obligations and duties hereby imposed on it unless the Master
Servicer's duties hereunder are no longer permissible under applicable law or
are in material conflict by reason of applicable law with any other activities
carried on by it and cannot be cured. Any such determination permitting the
resignation of the Master Servicer shall be evidenced by an Opinion of Counsel
that shall be independent to such effect delivered to the Trustee. No such
resignation shall become effective until the Trustee shall have assumed, or a
successor master servicer satisfactory to the Trustee and the Depositor shall
have assumed, the Master Servicer's responsibilities and obligations under this
Agreement. Notice of such resignation shall be given promptly by the Master
Servicer and the Depositor to the Trustee.
If at any time, Xxxxx Fargo Bank, National Association, as Master
Servicer, resigns under this Section 9.09, or is removed as Master Servicer
pursuant to Section 9.04, then at such time Xxxxx Fargo Bank, National
Association, shall also resign (and shall be entitled to resign) as Securities
Administrator under this Agreement.
Section 9.10 Assignment or Delegation of Duties by the Master
Servicer. Except as expressly provided herein, the Master Servicer shall not
assign or transfer any of its rights, benefits or privileges hereunder to any
other Person, or delegate to or subcontract with, or authorize or appoint any
other Person to perform any of the duties, covenants or obligations to be
performed by the Master Servicer; provided, however, that the Master Servicer
shall have the right with the prior written consent of the Depositor (which
shall not be unreasonably withheld or delayed), and upon delivery to the
Trustee, the Securities Administrator and the Depositor of a letter from each
Rating Agency to the effect that such action shall not result in a downgrade of
the ratings assigned to any of the Certificates, to delegate or assign to or
subcontract with or authorize or appoint any qualified Person to perform and
carry out any duties, covenants or obligations to be performed and carried out
by the Master Servicer hereunder, provided, further, that the Master Servicer
complies with Section 3.02(e) as if the Master Servicer were a "Servicer"
pursuant to that Section. Notice of such permitted assignment shall be given
promptly by the Master Servicer to the Depositor, the Securities Administrator
and the Trustee. If, pursuant to any provision hereof, the duties of the Master
Servicer are transferred to a successor master servicer, the entire compensation
payable to the Master Servicer pursuant hereto shall thereafter be payable to
such successor master servicer but in no event shall the fee payable to the
successor master servicer exceed that payable to the predecessor master
servicer.
Section 9.11 Limitation on Liability of the Master Servicer. Neither
the Master Servicer, nor any of the directors, officers, employees or agents of
the Master Servicer shall be under any liability to the Trustee, Securities
Administrator, the Servicer or the Certificateholders 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
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Master Servicer or any such person against any liability that would otherwise be
imposed by reason of willful malfeasance, bad faith or negligence in the
performance of its duties or by reason of reckless disregard for its obligations
and duties under this Agreement. The Master Servicer and any director, officer,
employee or agent of the Master Servicer may rely in good faith on any document
prima facie properly executed and submitted by any Person respecting any matters
arising hereunder. The Master Servicer shall be under no obligation to appear
in, prosecute or defend any legal action that is not incidental to its duties as
Master Servicer with respect to the Mortgage Loans under this Agreement and that
in its opinion may involve it in any expenses or liability; provided, however,
that the Master Servicer may in its sole discretion undertake any such action
that it may deem necessary or desirable in respect to this Agreement and the
rights and duties of the parties hereto and the interests of the
Certificateholders hereunder. In such event, the legal expenses and costs of
such action and any liability resulting therefrom, shall be liabilities of the
Trust Fund, and the Master Servicer shall be entitled to be reimbursed therefor
out of the Master Servicer Account in accordance with the provisions of Section
9.07 and Section 9.12.
The Master Servicer shall not be liable for any acts or omissions of
the Servicer except to the extent that damages or expenses are incurred as a
result of such act or omissions and such damages and expenses would not have
been incurred but for the negligence, willful malfeasance, bad faith or
recklessness of the Master Servicer in supervising, monitoring and overseeing
the obligations of the Servicer as required under this Agreement.
Section 9.12 Indemnification; Third Party Claims. The Master Servicer
agrees to indemnify the Depositor, the Servicer, the Trustee, the Custodian, the
Securities Administrator and the Trust Fund, and hold them harmless against any
and all claims, losses, penalties, fines, forfeitures, legal fees and related
costs, judgments, and any other costs, liability, fees and expenses that the
Depositor, the Servicer, the Trustee, the Custodian, the Securities
Administrator or the Trust Fund may sustain as a result of the Master Servicer's
willful malfeasance, bad faith or negligence in the performance of its duties
hereunder or by reason of its reckless disregard for its obligations and duties
under this Agreement, including, without limitation, its obligations under
Sections 3.02(e), 3.22 and 3.23 notwithstanding any transfer to a successor
master servicer or securities administrator, as the case may be. The Depositor,
Securities Administrator, the Servicer, the Custodian and the Trustee shall
immediately notify the Master Servicer if a claim is made by a third party with
respect to this Agreement or the Mortgage Loans which would entitle the
Depositor, the Servicer, the Trustee, the Securities Administrator, the
Custodian or the Trust Fund to indemnification under this Section 9.12,
whereupon the Master Servicer shall assume 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
them in respect of such claim.
The Master Servicer agrees to indemnify and hold harmless the Trustee
from and against any and all claims, losses, penalties, fines, forfeitures,
legal fees and related costs, judgments, and any other costs, liability, fees
and expenses (including reasonable attorneys' fees) that the Trustee may sustain
as a result of such respective liability or obligations of the Master Servicer
and in connection with the Trustee's assumption (not including the Trustee's
performance, except to the extent that costs or liability of the Trustee are
created or increased as a result of negligent or wrongful acts or omissions of
the Master Servicer prior to its replacement
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as Master Servicer) of the Master Servicer's obligations, duties or
responsibilities under such agreement.
The Trust Fund will indemnify the Master Servicer and hold it harmless
against any and all claims, losses, penalties, fines, forfeitures, legal fees
and related costs, judgments, and any other costs, liabilities, fees and
expenses that the Master Servicer, as applicable may incur or sustain in
connection with, arising out of or related to this Agreement or the
Certificates, except to the extent that any such loss, liability or expense is
related to (i) a material breach of the Master Servicer's representations and
warranties in this Agreement or (ii) the Master Servicer's willful malfeasance,
bad faith or negligence or by reason of its reckless disregard of its duties and
obligations under any such agreement; provided that any such loss, liability or
expense constitutes an "unanticipated expense incurred by the REMIC" within the
meaning of Treasury Regulations Section 1.860G-1(b)(3)(ii). The Master Servicer
shall be entitled to reimbursement for any such indemnified amount from funds on
deposit in the Distribution Account.
ARTICLE X
CONCERNING THE SECURITIES ADMINISTRATOR
Section 10.01 Duties of Securities Administrator. The Securities
Administrator shall undertake to perform such duties and only such duties as are
specifically set forth in this Agreement.
The Securities Administrator, upon receipt of all resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to the Securities Administrator that are specifically
required to be furnished pursuant to any provision of this Agreement shall
examine them to determine whether they are in the form required by this
Agreement; provided, however, that the Securities Administrator shall not be
responsible for the accuracy or content of any such resolution, certificate,
statement, opinion, report, document, order or other instrument. If any such
instrument is found not to conform in any material respect to the requirements
of this Agreement, the Securities Administrator shall notify the
Certificateholders of such non conforming instrument in the event the Securities
Administrator, after so requesting, does not receive a satisfactorily corrected
instrument.
No provision of this Agreement shall be construed to relieve the
Securities Administrator from liability for its own negligent action, its own
negligent failure to act or its own willful misconduct; provided, however, that:
(i) the duties and obligations of the Securities Administrator shall
be determined solely by the express provisions of this Agreement, the
Securities Administrator shall not be liable except for the performance of
such duties and obligations as are specifically set forth in this
Agreement, no implied covenants or obligations shall be read into this
Agreement against the Securities Administrator and the Securities
Administrator may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon any certificates or
opinions furnished to the Securities Administrator and conforming to the
requirements of this Agreement
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which it believed in good faith to be genuine and to have been duly
executed by the proper authorities respecting any matters arising
hereunder;
(ii) the Securities Administrator shall not be liable for an error of
judgment made in good faith by a Responsible Officer or Responsible
Officers of the Securities Administrator, unless it shall be conclusively
determined by a court of competent jurisdiction, such determination no
longer subject to appeal, that the Securities Administrator was negligent
in ascertaining the pertinent facts;
(iii) the Securities Administrator shall not be liable with respect to
any action or inaction taken, suffered or omitted to be taken by it in good
faith in accordance with the direction of the Holders of Certificates
evidencing not less than 25% of the Voting Rights of Certificates relating
to the time, method and place of conducting any proceeding for any remedy
available to the Securities Administrator, or exercising or omitting to
exercise any trust or power conferred upon the Securities Administrator
under this Agreement; and
(iv) the Securities Administrator shall not be accountable, shall have
no liability and makes no representation as to any acts or omissions
hereunder of the Master Servicer or the Trustee.
Section 10.02 Certain Matters Affecting the Securities Administrator.
Except as otherwise provided in Section 10.01:
(i) the Securities Administrator may request and conclusively rely
upon and shall be fully protected in acting or refraining from acting upon
any resolution, Officer's Certificate, certificate of auditors or any other
certificate, statement, instrument, opinion, report, notice, request,
consent, order, appraisal, bond or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party or
parties and the Securities Administrator shall have no responsibility to
ascertain or confirm the genuineness of any signature of any such party or
parties;
(ii) the Securities Administrator may consult with counsel, financial
advisers or accountants and the advice of any such counsel, financial
advisers or accountants and any advice or Opinion of Counsel shall be full
and complete authorization and protection in respect of any action taken or
suffered or omitted by it hereunder in good faith and in accordance with
such advice or Opinion of Counsel;
(iii) the Securities Administrator shall not be liable for any action
or inaction taken, suffered or omitted by it in good faith and believed by
it to be authorized or within the discretion or rights or powers conferred
upon it by this Agreement;
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(iv) the Securities Administrator shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
consent, order, approval, bond or other paper or document, unless requested
in writing so to do by Holders of Certificates evidencing not less than 25%
of the Voting Rights allocated to each Class of Certificates; provided,
however, that if the payment within a reasonable time to the Securities
Administrator of the costs, expenses or liabilities likely to be incurred
by it in the making of such investigation is, in the opinion of the
Securities Administrator, not reasonably assured to the Securities
Administrator by the security afforded to it by the terms of this
Agreement, the Securities Administrator may require reasonable indemnity
against such expense or liability as a condition to so proceeding. Nothing
in this clause (iv) shall derogate from the obligation of the Master
Servicer to observe any applicable law prohibiting disclosure of
information regarding the Mortgagors, provided that the Master Servicer
shall have no liability for disclosure required by this Agreement;
(v) the Securities Administrator may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through agents or attorneys or a custodian and the Securities Administrator
shall not be responsible for any misconduct or negligence on the part of
any such agent, attorney or custodian appointed by the Securities
Administrator with due care;
(vi) the Securities Administrator shall not be required to risk or
expend its own funds or otherwise incur any financial liability in the
performance of any of its duties or in the exercise of any of its rights or
powers hereunder if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or
liability is not assured to it, and none of the provisions contained in
this Agreement shall in any event require the Securities Administrator to
perform, or be responsible for the manner of performance of, any of the
obligations of the Master Servicer under this Agreement;
(vii) the Securities Administrator shall be under no obligation to
exercise any of the trusts, rights or powers vested in it by this Agreement
or to institute, conduct or defend any litigation hereunder or in relation
hereto at the request, order or direction of any of the Certificateholders,
pursuant to the provisions of this Agreement, unless such
Certificateholders shall have offered to the Securities Administrator
reasonable security or indemnity satisfactory to the Securities
Administrator against the costs, expenses and liabilities which may be
incurred therein or thereby;
(viii) the Securities Administrator shall have no obligation to appear
in, prosecute or defend any legal action that is not incidental to its
duties hereunder and which in its opinion may involve it in any expense or
liability; provided, however, that the Securities Administrator may in its
discretion undertake any such action that it may deem necessary or
desirable in respect of this Agreement and the rights and duties of the
parties hereto and the interests of the Trustee, the Securities
Administrator and the
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Certificateholders hereunder. In such event, the legal expenses and costs
of such action and any liability resulting therefrom shall be expenses,
costs and liabilities of the Trust Fund, and the Securities Administrator
shall be entitled to be reimbursed therefor out of the Distribution
Account;
(ix) the right of the Securities Administrator to perform any
discretionary act enumerated in this Agreement shall not be construed as a
duty, and the Securities Administrator shall not be answerable for other
than its negligence, bad faith or willful misconduct in the performance of
such act; and
(x) the Securities Administrator shall not be required to give any
bond or surety in respect of the execution of the Trust Fund created hereby
or the powers granted hereunder.
The Securities Administrator shall have no duty (A) to see to any
recording, filing, or depositing of this Agreement or any agreement referred to
herein or any financing statement or continuation statement evidencing a
security interest, or to see to the maintenance of any such recording or filing
or depositing or to any rerecording, refiling or redepositing thereof, (B) to
see to the provision of any insurance or (C) to see to the payment or discharge
of any tax, assessment, or other governmental charge or any lien or encumbrance
of any kind owing with respect to, assessed or levied against, any part of the
Trust Fund other than from funds available in the Distribution Account.
Section 10.03 Securities Administrator Not Liable for Certificates or
Mortgage Loans. The recitals contained herein and in the Certificates shall not
be taken as the statements of the Securities Administrator, and the Securities
Administrator assumes no responsibility for their correctness. The Securities
Administrator makes no representations as to the validity or sufficiency of this
Agreement or of the Certificates or of any Mortgage Loan or related document
other than with respect to the Securities Administrator's execution and
authentication of the Certificates. The Securities Administrator shall not be
accountable for the use or application by the Depositor or the Master Servicer
of any funds paid to the Depositor or the Master Servicer in respect of the
Mortgage Loans or deposited in or withdrawn from the Distribution Account by the
Depositor or the Master Servicer.
Section 10.04 Securities Administrator May Own Certificates. The
Securities Administrator in its individual or any other capacity may become the
owner or pledgee of Certificates and may transact business with the parties
hereto and their Affiliates with the same rights as it would have if it were not
the Securities Administrator.
Section 10.05 Securities Administrator's Fees and Expenses. The
Securities Administrator shall be entitled to the investment income earned on
amounts in the Distribution Account. The Securities Administrator and any
director, officer, employee, agent or "control person" within the meaning of the
Securities Act of 1933, as amended, and the Securities Exchange of 1934, as
amended ("Control Person"), of the Securities Administrator shall be indemnified
by the Trust and held harmless against any loss, liability or expense (including
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reasonable attorney's fees) (i) incurred in connection with any claim or legal
action relating to (a) this Agreement, (b) the Mortgage Loans or (c) the
Certificates, other than any loss, liability or expense incurred by reason of
willful misfeasance, bad faith or negligence in the performance of any of the
Securities Administrator's duties hereunder, (ii) incurred in connection with
the performance of any of the Securities Administrator's duties hereunder, other
than any loss, liability or expense incurred by reason of willful misfeasance,
bad faith or negligence in the performance of any of the Securities
Administrator's duties hereunder or (iii) incurred by reason of any action of
the Securities Administrator taken at the direction of the Certificateholders,
provided that any such loss, liability or expense constitutes an "unanticipated
expense incurred by the REMIC" within the meaning of Treasury Regulations
Section 1.860G 1(b)(3)(ii). Such indemnity shall survive the termination of this
Agreement or the resignation or removal of the Securities Administrator
hereunder. Without limiting the foregoing, and except for any such expense,
disbursement or advance as may arise from the Securities Administrator's
negligence, bad faith or willful misconduct, or which would not be an
"unanticipated expense" within the meaning of the second preceding sentence, the
Securities Administrator shall be reimbursed by the Trust for all reasonable
expenses, disbursements and advances incurred or made by the Securities
Administrator in accordance with any of the provisions of this Agreement with
respect to: (A) the reasonable compensation and the expenses and disbursements
of its counsel not associated with the closing of the issuance of the
Certificates, (B) the reasonable compensation, expenses and disbursements of any
accountant, engineer, appraiser or other agent that is not regularly employed by
the Securities Administrator, to the extent that the Securities Administrator
must engage such Persons to perform acts or services hereunder and (C) printing
and engraving expenses in connection with preparing any Definitive Certificates.
The Trust shall fulfill its obligations under this paragraph from amounts on
deposit from time to time in the Distribution Account. The Securities
Administrator shall be required to pay all expenses incurred by it in connection
with its activities hereunder and shall not be entitled to reimbursement
therefor except as provided in this Agreement.
The Securities Administrator shall not be entitled to payment or
reimbursement from the Unaffiliated Seller for any routine ongoing expenses
incurred by Xxxxx Fargo Bank, National Association, in its capacity as
Securities Administrator and/or Master Servicer in the ordinary course of its
duties as Securities Administrator, Master Servicer, Registrar, or paying agent
under this Agreement or for any other expenses, including indemnification
payments, except as set forth herein.
The Trustee executes the Certificates and the Securities Administrator
authenticates the Certificates not in its individual capacity but solely as
Trustee and Securities Administrator, respectively, of the Trust Fund created by
this Agreement, in the exercise of the powers and authority conferred and vested
in it by this Agreement.
Section 10.06 Eligibility Requirements for Securities Administrator.
The Securities Administrator hereunder shall at all times be a corporation or
association organized and doing business under the laws the United States of
America or any state thereof, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at
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least $50,000,000, subject to supervision or examination by federal or state
authority and with a credit rating of at least investment grade. If such
corporation or association publishes reports of condition at least annually,
pursuant to law or to the requirements of the aforesaid supervising or examining
authority, then for the purposes of this Section 10.06 the combined capital and
surplus of such corporation or association shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. In case at any time the Securities Administrator shall cease to be
eligible in accordance with the provisions of this Section 10.06, the Securities
Administrator shall resign immediately in the manner and with the effect
specified in Section 10.07 hereof. The entity serving as Securities
Administrator may have normal banking and trust relationships with the Depositor
and its affiliates or the Trustee and its affiliates.
Any successor Securities Administrator (i) may not be an originator,
the Master Servicer, the Servicer, the Depositor or an affiliate of the
Depositor unless the Securities Administrator functions are operated through an
institutional trust department of the Securities Administrator, (ii) must be
authorized to exercise corporate trust powers under the laws of its jurisdiction
of organization, and (iii) must be rated at least "A/F1" by Fitch, if Fitch is a
Rating Agency and rates such successor, or the equivalent rating by S&P or
Xxxxx'x. If no successor Securities Administrator shall have been appointed and
shall have accepted appointment within 60 days after the Securities
Administrator ceases to be the Securities Administrator pursuant to Section
10.07, then the Trustee may (but shall not be obligated to) become the successor
Securities Administrator. The Depositor shall appoint a successor to the
Securities Administrator in accordance with Section 10.07. The Trustee shall
notify the Rating Agencies of any change of Securities Administrator.
Section 10.07 Resignation and Removal of Securities Administrator. The
Securities Administrator may at any time resign by giving written notice of
resignation to the Depositor, the Swap Provider and the Trustee and each Rating
Agency not less than 60 days before the date specified in such notice when,
subject to Section 10.08, such resignation is to take effect, and acceptance by
a successor Securities Administrator in accordance with Section 10.08 meeting
the qualifications set forth in Section 10.06. If no successor Securities
Administrator meeting such qualifications shall have been so appointed by the
Depositor and have accepted appointment within 30 days after the giving of such
notice of resignation, the resigning Securities Administrator may petition any
court of competent jurisdiction for the appointment of a successor Securities
Administrator.
If at any time the Securities Administrator shall cease to be eligible
in accordance with the provisions of Section 10.06 hereof and shall fail to
resign after written request thereto by the Depositor, or if at any time the
Securities Administrator shall become incapable of acting, or shall be adjudged
as bankrupt or insolvent, or a receiver of the Securities Administrator or of
its property shall be appointed, or any public officer shall take charge or
control of the Securities Administrator or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation, or a tax is imposed with
respect to the Trust Fund by any state in which the Securities Administrator or
the Trust Fund is located and the imposition of such tax would be avoided by the
appointment of a different Securities Administrator, then the Depositor may
remove the Securities Administrator and appoint a successor Securities
Administrator by written instrument, in triplicate, one copy of which instrument
shall be delivered to the Securities
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Administrator so removed, one copy of which shall be delivered to the Master
Servicer and one copy to the successor Securities Administrator.
Any resignation or removal of the Securities Administrator and
appointment of a successor Securities Administrator pursuant to any of the
provisions of this Section 10.07 shall become effective upon acceptance by the
successor Securities Administrator of appointment as provided in Section 10.08
hereof.
Section 10.08 Successor Securities Administrator. Any successor
Securities Administrator (which may be the Trustee) appointed as provided in
Section 10.07 hereof shall execute, acknowledge and deliver to the Swap Provider
and the Depositor and to its predecessor Securities Administrator and the
Trustee an instrument accepting such appointment hereunder and thereupon the
resignation or removal of the predecessor Securities Administrator shall become
effective and such successor Securities Administrator, without any further act,
deed or conveyance, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor hereunder, with the like effect as if
originally named as Securities Administrator herein. The Depositor, the Trustee,
the Master Servicer and the predecessor Securities Administrator shall execute
and deliver such instruments and do such other things as may reasonably be
required for more fully and certainly vesting and confirming in the successor
Securities Administrator all such rights, powers, duties, and obligations.
No successor Securities Administrator shall accept appointment as
provided in this Section 10.08 unless at the time of such acceptance such
successor Securities Administrator shall be eligible under the provisions of
Section 10.06 hereof and its appointment shall not adversely affect the then
current rating of the Certificates, as confirmed in writing by each Rating
Agency.
Upon acceptance by a successor Securities Administrator of appointment
as provided in this Section 10.08, the Depositor shall mail notice of the
succession of such Securities Administrator hereunder to all Holders of
Certificates. If the Depositor fails to mail such notice within 10 days after
acceptance by the successor Securities Administrator of appointment, the
successor Securities Administrator shall cause such notice to be mailed at the
expense of the Depositor.
Section 10.09 Merger or Consolidation of Securities Administrator. Any
corporation or other entity into which the Securities Administrator may be
merged or converted or with which it may be consolidated or any corporation or
other entity resulting from any merger, conversion or consolidation to which the
Securities Administrator shall be a party, or any corporation or other entity
succeeding to the business of the Securities Administrator, shall be the
successor of the Securities Administrator hereunder, provided that such
corporation or other entity shall be eligible under the provisions of Section
10.06 hereof, without the execution or filing of any paper or further act on the
part of any of the parties hereto, anything herein to the contrary
notwithstanding. In connection with the succession to the Securities
Administrator under this Agreement by any Person (i) into which the Securities
Administrator may be merged or consolidated, or (ii) which may be appointed as a
successor to the Securities Administrator, the Securities Administrator shall
notify the Depositor of such succession or appointment and shall furnish to the
Depositor all information reasonably necessary for the Securities
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Administrator to accurately and timely report, pursuant to Section 8.12(g), the
event under Item 6.02 of Form 8-K pursuant to the Exchange Act (if such reports
under the Exchange Act are required to be filed under the Exchange Act).
Section 10.10 Assignment or Delegation of Duties by the Securities
Administrator. Except as expressly provided herein, the Securities Administrator
shall not assign or transfer any of its rights, benefits or privileges hereunder
to any other Person, or delegate to or subcontract with, or authorize or appoint
any other Person to perform any of the duties, covenants or obligations to be
performed by the Securities Administrator; provided, however, that the
Securities Administrator shall have the right with the prior written consent of
the Depositor (which shall not be unreasonably withheld or delayed) and upon
delivery to the Trustee and the Depositor of a letter from each Rating Agency to
the effect that such action shall not result in a downgrade of the ratings
assigned to any of the Certificates, to delegate or assign to or subcontract
with or authorize or appoint any qualified Person to perform and carry out any
duties, covenants or obligations to be performed and carried out by the
Securities Administrator hereunder, provided, further, that the Securities
Administrator complies with Section 3.02(e) as if the Securities Administrator
were a "Servicer" pursuant to that Section. Notice of such permitted assignment
shall be given promptly by the Securities Administrator to the Depositor, the
Swap Provider and the Trustee. If, pursuant to any provision hereof, the duties
of the Securities Administrator are transferred to a successor securities
administrator, the entire compensation payable to the Securities Administrator
pursuant hereto shall thereafter be payable to such successor securities
administrator but in no event shall the fee payable to the successor Securities
Administrator exceed that payable to the predecessor Securities Administrator.
ARTICLE XI
TERMINATION
Section 11.01 Termination upon Liquidation or Purchase of the Mortgage
Loans.
Subject to Section 11.03, the obligations and responsibilities of the
Depositor, the Servicer, the Securities Administrator and the Trustee created
hereby with respect to the Trust Fund shall terminate upon the earlier of (a)
the purchase, on or after the applicable Optional Termination Date, by the
Servicer, the Master Servicer or the Class X Certificateholders (subject to the
restrictions set forth in the definition of "Optional Termination Date") of all
Mortgage Loans (and REO Properties) at the price equal to the sum of (i) 100% of
the unpaid principal balance of each Mortgage Loan (other than in respect of REO
Property) plus accrued and unpaid interest thereon at the applicable Mortgage
Rate, (ii) the lesser of (x) the appraised value of any REO Property as
determined by the higher of two appraisals completed by two independent
appraisers selected by the party exercising the optimal termination at the
expense of the party exercising the optimal termination plus, accrued and unpaid
interest on each Mortgage Loan at the applicable Mortgage Rate and (y) the
unpaid principal balance of each Mortgage Loan related to any REO Property, in
each case plus accrued and unpaid interest thereon at the applicable Mortgage
Rate, (iii) all costs and expenses incurred by, or on behalf of, the Trust Fund,
of which the Securities Administrator has actual knowledge, in connection with
any violation by such Mortgage Loan of any predatory or abusive-lending law and
(iv) any Swap Termination Payment, other than a Defaulted Swap Termination
Payment, owed to the Swap
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Provider (the "Termination Price") and (b) the later of (i) the maturity or
other liquidation of the last Mortgage Loan remaining in the Trust Fund and the
disposition of all REO Property and (ii) the distribution to Certificateholders
of all amounts required to be distributed to them pursuant to this Agreement. In
no event shall the trusts created hereby continue beyond the expiration of 21
years from the death of the survivor of the descendants of Xxxxxx X. Xxxxxxx,
the late Ambassador of the United States to the Court of St. James's, living on
the date hereof.
Notwithstanding the foregoing, if Standard & Poor's has rated a class
of debt securities ("NIM Securities") that are backed by the Class X
Certificates and Class P Certificates and that are outstanding on any date on
which the Servicer intends to exercise its option to purchase the Mortgage
Loans, the Servicer will be permitted to exercise such option only if one of the
following additional conditions is met: (i) after distribution of the
Termination Price to the Certificateholders (other than the Holders of the Class
X Certificates, Class P Certificates and Class R Certificates) to redeem the
related Certificates, the remainder of the Termination Price (the "Remainder
Amount") is distributed to the Holders of the Class X Certificates and Class P
Certificates and is sufficient to pay the outstanding principal amount of and
accrued and unpaid interest on the NIM Securities to the extent the NIM
Securities are then outstanding; or (ii) (A) at the same time that the Servicer
remits the Termination Price to the Master Servicer, it also remits to the
Securities Administrator an additional amount which, in combination with the
Remainder Amount, is sufficient to pay the outstanding principal amount of and
accrued and unpaid interest on the NIM Securities, to the extent the NIM
Securities are then outstanding, and (B) the Securities Administrator remits the
Remainder Amount to the Holders of the Class X Certificates and Class P
Certificates and remits that additional amount directly to the NIM Trustee (plus
any outstanding fees and expenses due and owing to the NIM Trustee) under the
indenture creating the NIM Securities.
Section 11.02 Final Distribution on the Certificates.
If on any Remittance Date, the Servicer determines that there are no
Outstanding Mortgage Loans and no other funds or assets in the Trust Fund other
than the funds in the Collection Accounts, the Servicer shall direct the
Securities Administrator promptly to send a Notice of Final Distribution to each
Certificateholder and the Swap Provider. If the Servicer so elects to terminate,
by the 25th day of the month preceding the month of the final distribution, the
Servicer shall notify the Depositor, the Securities Administrator and the
Trustee of the final Distribution Date the Servicer or the Class X
Certificateholder of the date the Servicer intends to terminate the Trust Fund
and of the applicable repurchase price of the Mortgage Loans and REO Properties.
A Notice of Final Distribution, specifying the Distribution Date on
which Certificateholders may surrender their Certificates for payment of the
final distribution and cancellation, shall be given promptly by the Securities
Administrator by letter to Certificateholders mailed not earlier than the 10th
day and not later than the 15th day of the month of such final distribution. Any
such Notice of Final Distribution shall specify (a) the Distribution Date upon
which final distribution on the Certificates will be made upon presentation and
surrender of Certificates at the office therein designated, (b) the amount of
such final distribution, (c) the location of the office or agency at which such
presentation and
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surrender must be made, and (d) that the Record Date otherwise applicable to
such Distribution Date is not applicable, distributions being made only upon
presentation and surrender of the Certificates at the office therein specified.
The Servicer will give such Notice of Final Distribution to each Rating Agency
and the Swap Provider at the time such Notice of Final Distribution is given to
Certificateholders.
In the event such Notice of Final Distribution is given, the Servicer
shall cause all funds in its Collection Account to be remitted to the Master
Servicer for deposit in the Distribution Account on the Business Day prior to
the applicable Distribution Date in an amount equal to the final distribution in
respect of the Certificates. Upon such final deposit with respect to the Trust
Fund and the receipt by the Securities Administrator of a Request for Release
therefor, the Securities Administrator shall forward the Request for Release to
the Custodian and the Custodian shall promptly release to the Servicer the
Custodial Files for the Mortgage Loans.
Upon presentation and surrender of the Certificates, the Securities
Administrator shall cause to be distributed to the Certificateholders of each
Class (after reimbursement of all amounts due to the Servicer, the Depositor,
the Swap Provider and the Trustee hereunder), in each case on the final
Distribution Date and in the order set forth in Section 4.02, in proportion to
their respective Percentage Interests, with respect to Certificateholders of the
same Class, up to an amount equal to (i) as to each Class of Regular
Certificates (except the Class X Certificates), the Certificate Balance thereof
plus for each such Class and the Class X Certificates accrued interest thereon
in the case of an interest-bearing Certificate and all other amounts to which
such Classes are entitled pursuant to Section 4.02 and (ii) as to the Residual
Certificates, the amount, if any, which remains on deposit in the Distribution
Account (other than the amounts retained to meet claims) after application
pursuant to clause (i) above.
In the event that any affected Certificateholders shall not surrender
Certificates for cancellation within six months after the date specified in the
above mentioned written notice, the Securities Administrator shall give a second
written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within six months after the second notice all the applicable
Certificates shall not have been surrendered for cancellation, the Securities
Administrator may take appropriate steps, or may appoint an agent to take
appropriate steps, to contact the remaining Certificateholders concerning
surrender of their Certificates, and the cost thereof shall be paid out of the
funds and other assets which remain a part of the Trust Fund. If within one year
after the second notice all Certificates shall not have been surrendered for
cancellation, the Class R Certificateholders shall be entitled to all unclaimed
funds and other assets of the Trust Fund which remain subject hereto.
Section 11.03 Additional Termination Requirements.
In the event the Servicer exercises its purchase option with respect
to the Mortgage Loans as provided in Section 11.01, the Trust Fund shall be
terminated in accordance with the following additional requirements, unless the
Securities Administrator has been supplied with an Opinion of Counsel, at the
expense of the Servicer or the Class X Certificateholder, as
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applicable, to the effect that the failure to comply with the requirements of
this Section 11.03 will not (i) result in the imposition of taxes on "prohibited
transactions" on any REMIC created hereunder as defined in Section 860F of the
Code, or (ii) cause any REMIC created hereunder to fail to qualify as a REMIC at
any time that any Certificates are outstanding:
(a) The Securities Administrator on behalf of the Trustee shall sell
all of the assets of the Trust Fund to the Servicer and, no later than the next
Distribution Date after such sale (and in no event more than 90 days after such
sale), shall, in the order set forth in Section 4.02 and subject to the payment
of all amounts payable under Section 4.02, distribute to the Certificateholders
the proceeds of such sale in complete liquidation of each of the REMICs created
hereunder; and
(b) The Securities Administrator shall attach a statement to the final
federal income tax return for each of the REMICs created hereunder stating that
pursuant to Treasury regulations section 1.860F-1, the first day of the 90-day
liquidation period for each such REMIC was the date on which the Securities
Administrator on behalf of the Trustee sold the assets of the Trust Fund to the
Servicer.
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01 Amendment.
This Agreement may be amended from time to time (x) by the Depositor,
the Servicer, the Custodian, the Securities Administrator, the Master Servicer
and the Trustee (y) with the consent of the Unaffiliated Seller unless the
Securities Administrator and the Trustee receive an Opinion of Counsel (which
Opinion of Counsel shall not be an expense of the Securities Administrator, the
Master Servicer, the Trustee or the Trust) stating that the amendment will not
adversely affect the Unaffiliated Seller, but (z) without the consent of any of
the Certificateholders (i) to cure any ambiguity or mistake, (ii) to correct any
defective provision herein or to supplement any provision herein which may be
inconsistent with any other provision herein, (iii) to add to the duties of the
Depositor, the Master Servicer, the Securities Administrator or the Servicer,
(iv) to add any other provisions with respect to matters or questions arising
hereunder or (v) to modify, alter, amend, add to or rescind any of the terms or
provisions contained in this Agreement; provided, that any action pursuant to
clauses (iv) or (v) above shall not, as evidenced by an Opinion of Counsel
(which Opinion of Counsel shall not be an expense of the Securities
Administrator, the Trustee, the Master Servicer or the Trust), adversely affect
in any material respect the interests of any Certificateholder (it being
understood that any Opinion of Counsel with respect to income tax matters will
be limited to an opinion that such amendment will not cause the imposition of
any federal income tax on any REMIC created hereunder or the Certificateholders
or cause any REMIC created hereunder to fail to qualify as a REMIC at any time
that any Certificates are outstanding); and provided, further, that any such
action pursuant to clause (iv) or (v) above shall not be deemed to adversely
affect in any material respect the interests of the Swap Provider, the Cap
Provider or the Certificateholders if the Person requesting the amendment
obtains a letter from each Rating Agency stating that the amendment would not
result in the downgrading or withdrawal of the respective ratings then
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assigned to the Certificates; it being understood and agreed that any such
letter in and of itself will not represent a determination as to the materiality
of any such amendment and will represent a determination only as to the credit
issues affecting any such rating.
In addition, this Agreement may also be amended from time to time (x)
by the Trustee, the Depositor, the Custodian, the Securities Administrator, the
Master Servicer and the Servicer and (y) with the consent of the Unaffiliated
Seller unless the Trustee and the Securities Administrator receive an Opinion of
Counsel (which Opinion of Counsel shall not be an expense of the Securities
Administrator, the Master Servicer, the Trustee or the Trust) stating that the
amendment will not adversely affect the Unaffiliated Seller, but (z) without the
consent of the Certificateholders, to modify, eliminate or add to any of its
provisions to such extent as shall be necessary or helpful to (i) maintain the
qualification of REMIC I, REMIC II, REMIC III, REMIC IV and REMIC V under the
Code, (ii) avoid or minimize the risk of the imposition of any tax on REMIC I,
REMIC II, REMIC III, REMIC IV or REMIC V pursuant to the Code that would be a
claim at any time prior to the final redemption of the Certificates or (iii)
comply with any other requirements of the Code; provided, that the Trustee and
the Securities Administrator has been provided an Opinion of Counsel, which
opinion shall be an expense of the party requesting such opinion but in any case
shall not be an expense of the Securities Administrator, the Master Servicer,
the Trustee or the Trust, to the effect that such action is necessary or helpful
to, as applicable, (i) maintain such qualification, (ii) avoid or minimize the
risk of the imposition of such a tax or (iii) comply with any such requirements
of the Code.
This Agreement may also be amended from time to time (x) by the
Depositor, the Servicer, the Master Servicer, the Custodian, the Securities
Administrator and the Trustee (y) with the consent of the Unaffiliated Seller
unless the Securities Administrator receives an Opinion of Counsel (which
Opinion of Counsel shall not be an expense of the Securities Administrator, the
Master Servicer, the Trustee or the Trust) stating that the amendment will not
adversely affect the Unaffiliated Seller, and (z), except as set forth in
Section 3.27, with the consent of the Holders of Certificates evidencing
Percentage Interests aggregating not less than 66-2/3% of each Class of
Certificates (based on the aggregate outstanding principal balance of such class
at such time) affected thereby, for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement or
of modifying in any manner the rights of the Holders of Certificates; provided,
however, that no such amendment shall (i) reduce in any manner the amount of, or
delay the timing of, payments required to be distributed on any Certificate
without the consent of the Holder of such Certificate, (ii) adversely affect in
any material respect the interests of the Holders of any Class of Certificates
in a manner other than as described in (i), without the consent of the Holders
of Certificates of such Class evidencing, as to such Class, Percentage Interests
aggregating not less than 66-2/3%, or (iii) reduce the aforesaid percentages of
Certificates the Holders of which are required to consent to any such amendment,
without the consent of the Holders of all such Certificates then outstanding.
Notwithstanding any contrary provision of this Agreement, the Trustee
shall not consent to any amendment to this Agreement unless it shall have first
received an Opinion of Counsel, which opinion shall not be an expense of the
Securities Administrator, the Master Servicer, the Trustee or the Trust, to the
effect that such amendment will not cause the imposition of any federal income
tax on any REMIC or the Certificateholders or cause any
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REMIC created hereunder to fail to qualify as a REMIC at any time that any
Certificates are outstanding.
Notwithstanding the foregoing provisions of this Section 12.01, with
respect to any amendment that significantly modifies the permitted activities of
the Trustee, the Securities Administrator, the Master Servicer or the Servicer,
any Certificate beneficially owned by the Depositor, the Unaffiliated Seller or
any of their respective Affiliates shall be deemed not to be outstanding (and
shall not be considered when determining the percentage of Certificateholders
consenting or when calculating the total number of Certificates entitled to
consent) for purposes of determining if the requisite consents of
Certificateholders under this Section 12.01 have been obtained.
Notwithstanding any contrary provision of this Agreement, the
Securities Administrator shall not consent to any amendment, modification or
change to this Agreement without the prior written consent of the Swap Provider
or the Cap Provider, as applicable, if such amendment, modification or change
could reasonably be expected to have a material adverse effect on the rights or
obligations of the Swap Provider or the Cap Provider, as applicable, under this
Agreement or under the Interest Rate Swap Agreement or the Interest Rate Cap
Agreement, as applicable. Unless notified by the Swap Provider or the Cap
Provider, as applicable, that the Swap Provider or the Cap Provider, as
applicable, could reasonably be materially and adversely affected by such
amendment, modification or change, for purposes of determining whether an
amendment, modification or change could reasonably be expected to have a
material adverse effect on the Swap Provider or the Cap Provider, as applicable,
the Trustee and the Securities Administrator shall be entitled to rely on an
Opinion of Counsel (which Opinion of Counsel shall not be an expense of the
Securities Administrator or the Trustee) after giving notice of such amendment,
modification or change to the Swap Provider. The Securities Administrator shall
furnish to the Swap Provider and the Cap Provider a copy of each proposed
amendment, modification or change to this Agreement at least ten Business Days
prior to the execution thereof and a copy of each executed amendment,
modification or change to this Agreement promptly upon execution thereof, along
with copies of the letter from each Rating Agency stating that the amendment,
modification or change would not result in the downgrading or withdrawal of the
respective ratings then assigned to the Certificates.
Promptly after the execution of any amendment to this Agreement
requiring the consent of Certificateholders, the Securities Administrator shall
furnish written notification of the substance or a copy of such amendment to the
Swap Provider, the Cap Provider, each Certificateholder and each Rating Agency.
It shall not be necessary for the consent of Certificateholders under
this Section 12.01 to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
regulations as the Trustee may prescribe.
Nothing in this Agreement shall require the Securities Administrator,
the Trustee or the Custodian to enter into an amendment without receiving an
Opinion of Counsel (which Opinion shall not be an expense of the Trustee, the
Custodian, the Securities Administrator, the
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Master Servicer or the Trust), satisfactory to the Trustee, the Securities
Administrator, the Master Servicer and the Custodian that (i) such amendment is
permitted and is not prohibited by this Agreement and that all requirements for
amending this Agreement have been complied with; and (ii) either (A) the
amendment does not adversely affect in any material respect the interests of any
Certificateholder or (B) the conclusion set forth in the immediately preceding
clause (A) is not required to be reached pursuant to this Section 12.01.
Section 12.02 Recordation of Agreement; Counterparts.
This Agreement 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, such recordation
to be effected by the Servicer at its expense, but only upon receipt of an
Opinion of Counsel to the effect that such recordation materially and
beneficially affects the interests of the Certificateholders.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
Section 12.03 Governing Law.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND
TO BE PERFORMED IN THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
Section 12.04 Intention of Parties.
It is the express intent of the parties hereto that the conveyance (i)
of the Mortgage Loans by the Depositor and (ii) of the Trust Fund by the
Depositor to the Trustee each be, and be construed as, an absolute sale thereof.
It is, further, not the intention of the parties that such conveyances be deemed
a pledge thereof. However, in the event that, notwithstanding the intent of the
parties, such assets are held to be the property of the Depositor, as the case
may be, or if for any other reason this Agreement is held or deemed to create a
security interest in either such assets, then (i) this Agreement shall be deemed
to be a security agreement within the meaning of the Uniform Commercial Code of
the State of New York and (ii) the conveyances provided for in this Agreement
shall be deemed to be an assignment and a grant by the Depositor to the Trustee,
for the benefit of the Certificateholders, of a security interest in all of the
assets transferred, whether now owned or hereafter acquired.
The Depositor, for the benefit of the Certificateholders and the Swap
Provider, shall, to the extent consistent with this Agreement, take such actions
as may be necessary to ensure that, if this Agreement were deemed to create a
security interest in the Trust Fund, such security interest would be deemed to
be a perfected security interest of first priority under
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applicable law and will be maintained as such throughout the term of the
Agreement. The Depositor shall arrange for filing any Uniform Commercial Code
continuation statements in connection with any security interest granted or
assigned to the Trustee for the benefit of the Certificateholders.
Section 12.05 Notices.
(a) The Securities Administrator shall use its best efforts to
promptly provide notice to each Rating Agency with respect to each of the
following of which it has actual knowledge:
1. Any material change or amendment to this Agreement;
2. The occurrence of any Event of Default that has not been cured;
3. The resignation or termination of the Servicer, the Securities
Administrator, the Master Servicer or the Trustee and the
appointment of any successor;
4. The repurchase or substitution of Mortgage Loans pursuant to
Section 2.03; and
5. The final payment to Certificateholders.
(b) In addition, the Securities Administrator shall promptly furnish
to each Rating Agency copies of the following:
1. Each report to Certificateholders described in Section 4.03; and
2. Any notice of a purchase of a Mortgage Loan pursuant to Section
2.02, 2.03 or 3.11.
All directions, demands, consents, notices and other 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 or the Representative, Xxxxxx Xxxxxxx ABS
Capital I Inc. or Xxxxxx Xxxxxxx & Co. Incorporated, 0000 Xxxxxxxx, 00xx Xxxxx,
Xxx Xxxx, Xxx Xxxx, 00000, Attention: Xxxxxxx Xxx, with a copy to Xxxxx Xxx,
Esq., 0000 Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, (b) in the case of
the Servicer, Saxon Mortgage Services, Inc. 0000 Xxxxxxxxxx Xxxxx, Xxxx Xxxxx,
Xxxxx, 00000, Attention: Xxxxx Xxxx, President, with a copy to Saxon Capital,
Inc., 0000 Xxx Xxxx, Xxxxx 000, Xxxx Xxxxx, Xxxxxxxx 00000, Attention: General
Counsel, or such other address as may be hereafter furnished to the parties
hereto in writing, (c) in the case of the Securities Administrator or Master
Servicer to the Corporate Trust Office or such other address as the Securities
Administrator or Master Servicer may hereafter furnish to the parties hereto,
(d) in the case of the Trustee and the Custodian to Deutsche Bank National Trust
Company, 0000 Xxxx Xx. Xxxxxx Xxxxx, Xxxxx Xxx, Xxxxxxxxxx 00000-0000,
Attention: Trust Administration - IX0701, (e) in the case of the Unaffiliated
Seller, IXIS Real Estate Capital, Inc., 0 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: General Counsel, or such other address as the Unaffiliated
Seller may hereafter furnish to the parties hereto, (f) in the case of each of
the Rating Agencies,
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the address specified therefor in the definition corresponding to the name of
such Rating Agency, (g) in the case of any Originator, the address specified
therefor in the applicable Mortgage Loan Purchase Agreement and (h) in the case
of the Swap Provider, the address specified therefor in the Interest Rate Swap
Agreement. Notices to Certificateholders shall be deemed given when mailed,
first class postage prepaid, to their respective addresses appearing in the
Certificate Register.
Section 12.06 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms
of this Agreement shall be for any reason whatsoever held invalid, 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 or of the Certificates or the rights of the Holders thereof.
Section 12.07 Assignment.
Notwithstanding anything to the contrary contained herein, except as
provided in Section 6.04, this Agreement may not be assigned by the Servicer
without the prior written consent of the Trustee, the Securities Administrator
and the Depositor; provided, however, that, subject to Section 3.27, the
Servicer may pledge or sell its interest in any reimbursements for P&I Advances
or Servicing Advances hereunder.
Section 12.08 Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not operate to
terminate this Agreement or the trust created hereby, nor entitle such
Certificateholder's legal representative or heirs to claim an accounting or to
take any action or commence any proceeding in any court for a petition or
winding up of the trust created hereby, or otherwise affect the rights,
obligations and liabilities of the parties hereto or any of them.
No Certificateholder shall have any right to vote (except as provided
herein) or in any manner otherwise control the operation and management of the
Trust Fund, or the obligations of the parties hereto, nor shall anything herein
set forth or contained in the terms of the Certificates be construed so as to
constitute the Certificateholders from time to time as partners or members of an
association; nor shall any Certificateholder be under any liability to any third
party by reason of any action taken by the parties to this Agreement pursuant to
any provision hereof.
No Certificateholder shall have any right by virtue or by availing
itself of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Agreement,
unless such Holder previously shall have given to the Trustee a written notice
of an Event of Default and of the continuance thereof, as herein provided, and
unless the Holders of Certificates evidencing not less than 25% of the Voting
Rights evidenced by the Certificates shall also have made written request to the
Trustee to institute such action, suit or proceeding in its own name as Trustee
hereunder and shall have offered to the Trustee such reasonable indemnity as it
may require against the costs, expenses,
188
and liabilities to be incurred therein or thereby, and the Trustee, for 60 days
after its receipt of such notice, request and offer of indemnity shall have
neglected or refused to institute any such action, suit or proceeding; it being
understood and intended, and being expressly covenanted by each
Certificateholder with every other Certificateholder and the Trustee, that no
one or more Holders of Certificates shall have any right in any manner whatever
by virtue or by availing itself or themselves of any provisions of this
Agreement to affect, disturb or prejudice the rights of the Holders of any other
of the Certificates, or to obtain or seek to obtain priority over or preference
to any other such Holder or to enforce any right under this Agreement, except in
the manner herein provided and for the common benefit of all Certificateholders.
For the protection and enforcement of the provisions of this Section 12.08, each
and every Certificateholder and the Trustee shall be entitled to such relief as
can be given either at law or in equity.
Section 12.09 Inspection and Audit Rights.
The Servicer agrees that, on reasonable prior notice, it will permit
any representative of the Depositor, the Unaffiliated Seller, the Securities
Administrator, the Master Servicer or the Trustee during the Servicer's normal
business hours, to examine all the books of account, records, reports and other
papers of the Servicer relating to the Mortgage Loans, to make copies and
extracts therefrom, to cause such books to be audited by independent certified
public accountants selected by the party conducting the inspection and to
discuss its affairs, finances and accounts relating to the Mortgage Loans with
its officers, employees and independent public accountants (and by this
provision the Servicer hereby authorizes said accountants to discuss with such
representative such affairs, finances and accounts), all at such reasonable
times and as often as may be reasonably requested. Any customary out-of-pocket
expense of the Servicer incident to the exercise by the Depositor, the
Unaffiliated Seller, the Securities Administrator or the Trustee of any right
under this Section 12.09 shall be borne by the Servicer.
Section 12.10 Certificates Nonassessable and Fully Paid.
It is the intention of the Depositor that Certificateholders shall not
be personally liable for obligations of the Trust Fund, that the interests in
the Trust Fund represented by the Certificates shall be nonassessable for any
reason whatsoever, and that the Certificates, upon due authentication thereof by
the Securities Administrator pursuant to this Agreement, are and shall be deemed
fully paid.
Section 12.11 [Reserved]
Section 12.12 Third Party Beneficiary.
The parties agree that each of the Swap Provider and the Cap Provider
is intended and shall have all rights of a third-party beneficiary of this
Agreement. Notwithstanding anything to the contrary herein, any notices required
to be provided to the Swap Provider or the Cap Provider under this Agreement
shall no longer be required following the termination of the Swap Agreement or
the Cap Agreement, as applicable.
189
Section 12.13 Waiver of Jury Trial.
EACH PARTY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, WAIVES (TO
THE EXTENT PERMITTED BY APPLICABLE LAW) ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY
OF ANY DISPUTE ARISING UNDER OR RELATING TO THIS AGREEMENT AND AGREES THAT ANY
SUCH DISPUTE SHALL BE TRIED BEFORE A JUDGE SITTING WITHOUT A JURY.
Section 12.14 Regulation AB Compliance; Intent of the Parties;
Reasonableness. The parties hereto acknowledge 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
agree to comply with reasonable requests made by the Depositor in good faith for
delivery of information under these provisions on the basis of evolving
interpretations of Regulation AB. In connection with the Trust, the Master
Servicer, the Servicer, the Securities Administrator, the Trustee and the
Custodian shall cooperate fully with the Depositor to deliver to the Depositor
(including its assignees or designees), any and all statements, reports,
certifications, records and any other information available to such party and
reasonably necessary in the good faith determination of the parties hereto to
permit the Depositor to comply with the provisions of Regulation AB, together
with such disclosures relating to the Master Servicer, the Servicer, the
Securities Administrator, the Trustee and the Custodian, as applicable,
reasonably believed by the Depositor to be necessary in order to effect such
compliance.
190
IN WITNESS WHEREOF, the Depositor, the Trustee, the Unaffiliated
Seller, the Servicer, the Securities Administrator, the Master Servicer and the
Custodian have caused their names to be signed hereto by their respective
officers thereunto duly authorized as of the day and year first above written.
XXXXXX XXXXXXX ABS CAPITAL I INC.,
as Depositor
By:
------------------------------------
Name:
Title:
XXXXX FARGO BANK, National Association,
as Master Servicer and Securities
Administrator
By:
------------------------------------
Name:
Title:
DEUTSCHE BANK NATIONAL TRUST COMPANY,
solely as Trustee and not in its
individual capacity, and as Custodian
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
SAXON MORTGAGE SERVICES, INC.,
as Servicer
By:
------------------------------------
Name:
Title:
IXIS REAL ESTATE CAPITAL INC.,
as Unaffiliated Seller
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
Signature Page to Pooling and Servicing Agreement
191
SCHEDULE I
MORTGAGE LOAN SCHEDULE
[ON FILE WITH XXXXX XXXXXXXXXX LLP]
I-A-1
SCHEDULE IA
[RESERVED]
IA-1
SCHEDULE IB
SCHEDULE OF SAXON SERVICED LOANS
[ON FILE WITH XXXXX XXXXXXXXXX LLP]
IB-1
SCHEDULE II
[Reserved]
II-1
SCHEDULE IIA
[Reserved]
II-A-1
SCHEDULE III
IXIS REAL ESTATE CAPITAL TRUST 2007-HE1
MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2007-HE1
REPRESENTATIONS AND WARRANTIES OF SAXON
(1) The Servicer is duly organized as a corporation and is validly
existing and in good standing under the laws of the state of Texas and is
licensed and qualified to transact any and all business contemplated by
this Pooling and Servicing Agreement to be conducted by the Servicer in any
state in which a Mortgaged Property securing a Mortgage Loan is located or
is otherwise not required under applicable law to effect such qualification
and, in any event, is in compliance with the doing business laws of any
such State, to the extent necessary to ensure its ability to enforce each
Mortgage Loan and to service the Mortgage Loans in accordance with the
terms of this Pooling and Servicing Agreement;
(2) The Servicer has the full power and authority to service each
Mortgage Loan, and to execute, deliver and perform, and to enter into and
consummate the transactions contemplated by this Pooling and Servicing
Agreement and has duly authorized by all necessary action on the part of
the Servicer the execution, delivery and performance of this Pooling and
Servicing Agreement; and this Pooling and Servicing Agreement, assuming the
due authorization, execution and delivery thereof by the other parties
thereto, constitutes a legal, valid and binding obligation of the Servicer,
enforceable against the Servicer in accordance with its terms, except to
the extent that (a) the enforceability thereof may be limited by
bankruptcy, insolvency, moratorium, receivership and other similar laws
relating to creditors' rights generally and (b) the remedy of specific
performance and injunctive and other forms of equitable relief may be
subject to the equitable defenses and to the discretion of the court before
which any proceeding therefor may be brought;
(3) The execution and delivery of this Pooling and Servicing Agreement
by the Servicer, the servicing of the Mortgage Loans by the Servicer
hereunder, the consummation by the Servicer of any other of the
transactions herein contemplated, and the fulfillment of or compliance with
the terms hereof are in the ordinary course of business of the Servicer and
will not (A) result in a breach of any term or provision of the
organizational documents of the Servicer or (B) conflict with, result in a
breach, violation or acceleration of, or result in a default under, the
terms of any other material agreement or instrument to which the Servicer
is a party or by which it may be bound, or any statute, order or regulation
applicable to the Servicer of any court, regulatory body, administrative
agency or governmental body having jurisdiction over the Servicer; and the
Servicer is not a party to, bound by, or in breach or violation of any
indenture or other agreement or instrument, or subject to or in violation
of any statute, order or regulation of any court, regulatory body,
administrative agency or governmental body having jurisdiction over it,
which materially and adversely affects or, to the Servicer's
III-1
knowledge, would in the future materially and adversely affect, (x) the
ability of the Servicer to perform its obligations under this Pooling and
Servicing Agreement or (y) the business, operations, financial condition,
properties or assets of the Servicer taken as a whole;
(4) The Servicer is an approved seller/servicer for Xxxxxx Xxx or
Xxxxxxx Mac;
(5) No action, suit, proceeding or investigation is pending or, to the
best of the Servicer's knowledge, threatened against the Servicer, before
any court, administrative agency or other tribunal asserting the invalidity
of this Pooling and Servicing Agreement, seeking to prevent the
consummation of any of the transactions contemplated by this Pooling and
Servicing Agreement or which, either in any one instance or in the
aggregate, may result in any material adverse change in business,
operations, financial conditions, properties or assets of the Servicer, or
in any material impairment of the right or ability of the Servicer to carry
on its business substantially as now conducted, or in any material
liability on the part of the Servicer, or which would draw into question
the validity of this Pooling and Servicing Agreement or the Mortgage Loans
or of any action taken or to be taken in connection with the obligations of
the Servicer contemplated herein, or which would be likely to impair
materially the ability of the Servicer to perform under the terms of this
Pooling and Servicing Agreement;
(6) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Servicer of, or compliance by the Servicer with, this
Pooling and Servicing Agreement or the consummation by the Servicer of the
transactions contemplated by this Pooling and Servicing Agreement, except
for such consents, approvals, authorizations or orders, if any, that have
been obtained prior to the Closing Date;
(7) The Servicer represents that its computer and other systems used
in servicing the Mortgage Loans operate in a manner such that the Servicer
can service the Mortgage Loans in accordance with the terms of this Pooling
and Servicing Agreement; and
(8) With respect to each Mortgage Loan, to the extent the Servicer
serviced such Mortgage Loan and to the extent the Servicer provided monthly
reports to the three credit repositories, the Servicer has fully furnished,
in accordance with the Fair Credit Reporting Act and its implementing
regulation, accurate and compete information (i.e., favorable and
unfavorable) on its borrower credit files to Equifax, Experian, and Trans
Union Credit Information Company (three of the national credit
repositories), on a monthly basis.
III-2
SCHEDULE IIIA
FURTHER REPRESENTATIONS AND WARRANTIES OF SAXON
(1) Mortgage Loan Schedule. With respect to each Mortgage Loan, as of
the applicable Cut-off Date, each of (1) the last Due Date on which a
payment was actually applied to the outstanding principal balance of each
Mortgage Loan; (2) the Stated Principal Balance of each Mortgage Loan,
after deduction of payments of principal due and collected on or before the
applicable Cut-off Date; and (3) the Servicing Transfer Date for each
Mortgage Loan, in each case, as listed on the Mortgage Loan Schedule, is
true and correct;
(2) Payments Current. Unless otherwise indicated on the related
Mortgage Loan Schedule, with respect to each Mortgage Loan, no Scheduled
Payment is 30 days or more Delinquent as of the Cut-off Date nor has any
Payment been 30 days or more Delinquent at any time from and after the
Servicing Transfer Date through the Cut-off Date;
(3) Original Terms Unmodified. With respect to each Mortgage Loan, the
terms of the Mortgage Note and Mortgage have not been impaired, waived,
altered or modified by or on behalf of the Servicer from and after the
Servicing Transfer Date;
(4) No Satisfaction of Mortgage. With respect to each Mortgage Loan,
since the related Servicing Transfer Date and except for prepayments in
full, the Mortgage has not been satisfied, cancelled, 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 release, cancellation,
subordination or rescission. From and after the Servicing Transfer Date,
the Servicer has not waived the performance by the Mortgagor of any action,
if the Mortgagor's failure to perform such action would cause the Mortgage
Loan to be in default, nor has the Servicer waived any default resulting
from any action or inaction by the Mortgagor;
(5) No Defaults. With respect to each Mortgage Loan, to the best
knowledge of the Servicer, other than payments due but not yet 30 days
Delinquent, there is no material default, breach, violation or event which
would permit acceleration existing under the Mortgage or the Mortgage Note;
(6) Escrow Payments/Interest Rate Adjustments. With respect to each
Mortgage Loan, since the Servicing Transfer Date, the servicing and
collection practices used by the Servicer with respect to such Mortgage
Loan have been in all material respects in compliance with Accepted
Servicing Practices, applicable laws and regulations, and have been in all
material respects legal and proper. With respect to escrow deposits and
Escrow Payments, if any, all such deposits and payments received by the
Servicer are in the possession of, or under the control of, the Servicer
and there exist no deficiencies in connection therewith for which customary
arrangements for repayment thereof have not been made. All Escrow Payments
have been collected in full
III-A-1
compliance with state and federal law and the provisions of the related
Mortgage Note and Mortgage (to the extent not otherwise prohibited by law).
From and after the Servicing Transfer Date, all Mortgage Rate adjustments
(if any) have been made in strict compliance with state and federal law and
the terms of the related Mortgage Note;
(7) Other Insurance Policies. The improvements upon each Mortgaged
Property are covered by a valid and existing hazard insurance policy with a
generally acceptable carrier that provides for fire and extended coverage
and coverage for such other hazards as are customary in the area where the
Mortgaged Property is located; and
(8) Servicemembers Civil Relief Act. With respect to each Mortgage
Loan, from and after the Servicing Transfer Date, no Mortgagor has notified
the Servicer, and the Servicer has no knowledge, of any relief requested
and allowed to the Mortgagor under the Servicemembers Civil Relief Act or
any similar state or local law.
III-A-2
SCHEDULE IV
(a) Due Organization and Authority. The Unaffiliated Seller is a corporation
duly organized, validly existing and in good standing under the laws of the
state of New York 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 wherein it owns or leases any material properties or 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
Unaffiliated Seller, and in any event the Unaffiliated Seller is in
compliance with the laws of any such state to the extent necessary; the
Unaffiliated Seller has the full corporate power, authority and legal right
to execute and deliver this Agreement and to perform its obligations
hereunder; the execution, delivery and performance of this Agreement by the
Unaffiliated Seller and the consummation of the transactions contemplated
hereby have been duly and validly authorized; this Agreement and all
agreements contemplated hereby have been duly executed and delivered and
constitute the valid, legal, binding and enforceable obligations of the
Unaffiliated Seller, regardless of whether such enforcement is sought in a
proceeding in equity or at law; and all requisite corporate action has been
taken by the Unaffiliated Seller to make this Agreement and all agreements
contemplated hereby valid and binding upon the Unaffiliated Seller in
accordance with their terms;
(b) No Conflicts. Neither the execution and delivery of this Agreement, the
consummation of 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, conditions or
provisions of the Unaffiliated Seller's charter or by-laws or any legal
restriction or any agreement or instrument to which the Unaffiliated Seller
is now a party or by which it is bound, or constitute a default or result
in an acceleration under any of the foregoing, except such unfulfillment,
non-compliance or default or acceleration does not in the aggregate have a
material adverse effect on the operation, business, condition (business or
otherwise) of the Unaffiliated Seller or result in the violation of any
law, rule, regulation, order, judgment or decree to which the Unaffiliated
Seller or its property is subject, except such violation does not in the
aggregate have a material adverse effect on the operation, business,
condition (business or otherwise) of the Unaffiliated Seller or result in
the creation or imposition of any lien, charge or encumbrance that would
have an adverse effect upon any of its properties pursuant to the terms of
any mortgage, contract, deed of trust or other instrument;
(c) No Litigation Pending. There is no action, suit, proceeding or
investigation pending nor, to the Unaffiliated Seller's knowledge,
threatened against the Unaffiliated Seller, before any court,
administrative agency or other tribunal asserting the invalidity of this
Agreement, seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or 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 Unaffiliated
Seller, or in any material impairment of the right or ability of the
Unaffiliated Seller to carry on its business substantially as now
conducted, or which would draw into question the validity of this Agreement
or of any action taken or to be taken in connection with the obligations of
the Unaffiliated Seller contemplated herein, or
IV-1
which would be likely to impair materially the ability of the Unaffiliated
Seller to perform under the terms of this Agreement; and
(d) No Consent Required. No consent, approval, authorization or order of, or
registration or filing with, or notice to any court or governmental agency
or body including HUD, the FHA or the VA is required for the execution,
delivery and performance by the Unaffiliated Seller of or compliance by the
Unaffiliated Seller with this Agreement or the consummation of the
transactions contemplated by this Agreement, or if required, such approval
has been obtained prior to the Closing Date.
IV-2
EXHIBIT A
Unless this Certificate is presented by an authorized representative of the
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent
for registration of transfer, exchange, or payment, and any certificate issued
is registered in the name of Cede & Co. or in such other name as is requested by
an authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede, has an interest
herein.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN ONE OR MORE CLASSES OF "REGULAR INTERESTS" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN
SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER ASSETS.
EACH PURCHASER OR TRANSFEREE OF THIS CERTIFICATE THAT IS AN EMPLOYEE BENEFIT
PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), SECTION 4975 OF THE CODE, OR ANY
FEDERAL, STATE OR LOCAL LAW MATERIALLY SIMILAR TO THE FOREGOING PROVISIONS OF
ERISA OR THE CODE, (EACH, A "PLAN"), OR THAT IS ACTING ON BEHALF OF A PLAN OR
USING THE ASSETS OF A PLAN TO ACQUIRE THIS CERTIFICATE, SHALL BE DEEMED TO
REPRESENT THAT (I) IT QUALIFIES AS AN ACCREDITED INVESTOR AS DEFINED IN RULE
501(A)(1) OF REGULATION D OF THE SECURITIES AND EXCHANGE COMMISSION UNDER THE
SECURITIES ACT OF 1933 AND, FOR SO LONG AS EITHER OF THE INTEREST RATE SWAP
AGREEMENT (AS DEFINED IN THE AGREEMENT) OR THE INTEREST RATE CAP AGREEMENT (AS
DEFINED IN THE AGREEMENT) IS IN EFFECT, (II) ITS ACQUISITION AND HOLDING OF AN
INTEREST IN THE SUPPLEMENTAL INTEREST TRUST (AS DEFINED IN THE AGREEMENT) WILL
BE ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER EITHER AN INVESTOR-BASED
EXEMPTION (AS DEFINED IN THE AGREEMENT) OR THE STATUTORY EXEMPTION UNDER SECTION
408(b)(17) OF ERISA AND SECTION 4975(d)(20) OF THE CODE.
Certificate No. : [A-1-1/A-2-1/A-3-1/A-4-1//M-1-1/M-2-1/
M-3-1/M-4-1/M-5-1/M-6-1/B-1-1/B-2-1/B-3-1]
Cut-off Date : January 1, 2007
First Distribution Date : February 26, 2007
Initial Certificate Balance of this
Certificate ("Denomination") :
Initial Certificate Balances of all
Certificates of this Class :
CUSIP :
ISIN :
A-1
XXXXXX XXXXXXX ABS CAPITAL I INC.
IXIS REAL ESTATE CAPITAL TRUST 2007-HE1
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2007-HE1
[CLASS A-1] [CLASS A-2] [CLASS A-3] [CLASS A-4]
[CLASS M-1] [CLASS M-2] [CLASS M-3] [CLASS
M-4] [CLASS M-5] [CLASS M-6] [CLASS B-1]
[CLASS B-2] [CLASS B-3]
evidencing a percentage interest in the distributions allocable to the
Certificates of the above-referenced Class.
Principal in respect of this Certificate is distributable monthly as set forth
herein. Accordingly, the Certificate Balance at any time may be less than the
Certificate Balance as set forth herein. This Certificate does not evidence an
obligation of, or an interest in, and is not guaranteed by the Depositor, the
Unaffiliated Seller, the Securities Administrator, the Master Servicer, any
Originator, the Servicer or the Trustee referred to below or any of their
respective affiliates. Neither this Certificate nor the Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality.
This certifies that CEDE & CO. is the registered owner of the Percentage
Interest evidenced by this Certificate (obtained by dividing the denomination of
this Certificate by the aggregate of the denominations of all Certificates of
the Class to which this Certificate belongs) in certain monthly distributions
pursuant to a Pooling and Servicing Agreement dated as of the Cut-off Date
specified above (the "Agreement") among Xxxxxx Xxxxxxx ABS Capital I Inc., as
depositor (the "Depositor"), Saxon Mortgage Services, Inc., as servicer ("Saxon"
and the "Servicer"), IXIS Real Estate Capital Inc., as unaffiliated seller (the
"Unaffiliated Seller"), Deutsche Bank National Trust Company, as trustee and
custodian (in each such capacity, respectively, the "Trustee" and the
"Custodian") and Xxxxx Fargo Bank, National Association, as securities
administrator and master servicer (in each such capacity, respectively, the
"Securities Administrator" and the "Master Servicer"). To the extent not defined
herein, the capitalized terms used herein have the meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Reference is hereby made to the further provisions of this Certificate set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement or be
valid for any purpose unless manually authenticated by an authorized signatory
of the Securities Administrator.
* * *
A-2
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:_____________
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Securities Administrator
By:
------------------------------------
Authenticated:
By:
-----------------------------------
Authorized Signatory of
XXXXX FARGO BANK, NATIONAL
ASSOCIATION,
not in its individual capacity,
but solely as Certificate Registrar
A-3
XXXXXX XXXXXXX ABS CAPITAL I INC.
IXIS REAL ESTATE CAPITAL TRUST 2007-HE1
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2007-HE1
This Certificate is one of a duly authorized issue of Certificates designated as
IXIS Real Estate Capital Trust 2007-HE1 Mortgage Pass-Through Certificates,
Series 2007-HE1 (herein collectively called the "Certificates"), and
representing a beneficial ownership interest in the Trust Fund created by the
Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that it
will look solely to the funds on deposit in the Distribution Account for payment
hereunder and that the Securities Administrator is not liable to the
Certificateholders for any amount payable under this Certificate or the
Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement.
This Certificate does not purport to summarize the Agreement and reference is
made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee and the Securities Administrator.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th
day of each month or, if such 25th day is not a Business Day, the Business Day
immediately following (the "Distribution Date"), commencing on the first
Distribution Date specified on the face hereof, to the Person in whose name this
Certificate is registered at the close of business on the applicable Record Date
in an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to Holders of Certificates
of the Class to which this Certificate belongs on such Distribution Date
pursuant to the Agreement. The Record Date applicable to each Distribution Date
is the Business Day immediately preceding such Distribution Date; provided,
however, that for any Definitive Certificates, the Record Date shall be the last
Business Day of the month next preceding the month of such Distribution Date.
Distributions on this Certificate shall be made by wire transfer of immediately
available funds to the account of the Holder hereof at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have so
notified the Securities Administrator in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment and
surrender of such Certificate at the offices designated by the Securities
Administrator for such purposes, or such other location specified in the notice
to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Trustee, the
Securities Administrator and the rights of the Certificateholders under the
Agreement at any time by the parties to the Agreement, with the consent of the
Holders of Certificates affected by such amendment evidencing the requisite
Percentage Interest, as provided in the Agreement. Any such consent by the
Holder of
A-4
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange therefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register of the Securities Administrator upon surrender of this Certificate for
registration of transfer at the offices designated by the Securities
Administrator for such purposes, accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator and the Certificate
Registrar duly executed by the holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations and evidencing the same aggregate Percentage
Interest in the Trust Fund will be issued to the designated transferee or
transferees.
The Certificates are issuable only as registered Certificates without coupons in
denominations specified in the Agreement. As provided in the Agreement and
subject to certain limitations therein set forth, Certificates are exchangeable
for new Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
The Depositor, the Servicer, the Unaffiliated Seller, the Securities
Administrator, the Master Servicer and the Trustee and any agent of any of them
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and no such party shall be affected by any notice to
the contrary.
On any Distribution Date on which the aggregate Stated Principal Balance of the
Mortgage Loans, as of the last day of the related Due Period, is less than or
equal to 5% of the Maximum Pool Principal Balance, the Servicer and/or the Class
X Certificateholders will have the option to repurchase, in whole, from the
Trust Fund all remaining Mortgage Loans and all property acquired in respect of
the Mortgage Loans at a purchase price determined as provided in the Agreement.
The obligations and responsibilities created by the Agreement will terminate as
provided in Section 11.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning.
A-5
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address: _____________________________________________________.
Dated: __________
---------------------------------------
Signature by or on behalf of assignor
A-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _____________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
for the account of______________________________________________________________
account number _______, or, if mailed by check, to _____________________________
Applicable statements should be mailed to ______________________________________
________________________________________________________________________________
This information is provided by ________________________________________________
the assignee named above, or ___________________________________________________
as its agent.
A-7
EXHIBIT B
IF THIS CERTIFICATE IS A PHYSICAL CERTIFICATE, NEITHER THIS CERTIFICATE NOR ANY
INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE PROPOSED TRANSFEROR DELIVERS TO
THE SECURITIES ADMINISTRATOR A TRANSFEROR LETTER (THE "TRANSFEROR LETTER") IN
THE FORM OF EXHIBIT I TO THE AGREEMENT REFERRED TO HEREIN AND EITHER (I) THE
SECURITIES ADMINISTRATOR RECEIVES A RULE 144A LETTER (THE "144A LETTER") IN THE
FORM OF EXHIBIT J TO THE AGREEMENT REFERRED TO HEREIN OR (II) THE SECURITIES
ADMINISTRATOR RECEIVES AN OPINION OF COUNSEL, DELIVERED AT THE EXPENSE OF THE
TRANSFEROR, THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED.
IF THIS CERTIFICATE IS A BOOK-ENTRY CERTIFICATE, THE PROPOSED TRANSFEROR WILL BE
DEEMED TO HAVE MADE EACH OF THE CERTIFICATIONS SET FORTH IN THE TRANSFEROR
LETTER AND THE PROPOSED TRANSFEREE WILL BE DEEMED TO HAVE MADE EACH OF THE
CERTIFICATIONS SET FORTH IN THE RULE 144A LETTER, IN EACH CASE AS IF SUCH
CERTIFICATE WERE EVIDENCED BY A PHYSICAL CERTIFICATE
IF THIS CERTIFICATE IS A PHYSICAL CERTIFICATE, NEITHER THIS CERTIFICATE NOR ANY
INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE
SECURITIES ADMINISTRATOR A REPRESENTATION LETTER TO THE EFFECT THAT EITHER (I)
SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE
I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"),
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR
ANY FEDERAL, STATE OR LOCAL LAW MATERIALLY SIMILAR TO THE FOREGOING PROVISIONS
OF ERISA OR THE CODE (EACH, A "PLAN"), AND IS NOT ACTING ON BEHALF OF ANY PLAN
OR USING THE ASSETS OF ANY PLAN TO ACQUIRE THIS CERTIFICATE, OR (II) SUCH
TRANSFEREE IS AN INSURANCE COMPANY AND IS PURCHASING THIS CERTIFICATE WITH FUNDS
CONTAINED IN AN "INSURANCE COMPANY GENERAL ACCOUNT" (AS SUCH TERM IS DEFINED IN
SECTION V(E) OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTCE 95-60")) AND
THE CONDITIONS FOR EXEMPTIVE RELIEF UNDER SECTIONS I AND III OF PTCE 95-60 ARE
SATISFIED WITH RESPECT TO ITS PURCHASE AND HOLDING OF THIS CERTIFICATE. IF THIS
CERTIFICATE IS A BOOK-ENTRY CERTIFICATE, EACH TRANSFEREE WILL BE DEEMED TO HAVE
MADE THE FOREGOING REPRESENTATION.
B-1
Unless this Certificate is presented by an authorized representative of the
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent
for registration of transfer, exchange, or payment, and any certificate issued
is registered in the name of Cede & Co. or in such other name as is requested by
an authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN ONE OR MORE CLASSES OF "REGULAR INTERESTS" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN
SECTIONS 860G AND 860D OF THE CODE AND CERTAIN OTHER ASSETS.
Certificate No. : B-4-1
Cut-off Date : January 1, 2007
First Distribution Date : February 26, 2007
Initial Certificate Balance of this
Certificate ("Denomination") :
Initial Certificate Balances of all
Certificates of this Class : $
CUSIP
ISIN :
B-2
XXXXXX XXXXXXX ABS CAPITAL I INC.
IXIS REAL ESTATE CAPITAL TRUST 2007-HE1
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2007-HE1
CLASS B-4
evidencing a percentage interest in the distributions allocable to the
Certificates of the above-referenced Class.
Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Balance at any time may be less
than the Certificate Balance as set forth herein. This Certificate does not
evidence an obligation of, or an interest in, and is not guaranteed by the
Depositor, the Unaffiliated Seller, any Originator, the Servicer, the Securities
Administrator, the Master Servicer or the Trustee referred to below or any of
their respective affiliates. Neither this Certificate nor the Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality.
This certifies that CEDE & CO., is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
denomination of this Certificate by the aggregate of the denominations of all
Certificates of the Class to which this Certificate belongs) in certain monthly
distributions pursuant to a Pooling and Servicing Agreement dated as of the
Cut-off Date specified above (the "Agreement") among Xxxxxx Xxxxxxx ABS Capital
I Inc., as depositor (the "Depositor"), Saxon Mortgage Services, Inc., as a
servicer ("Saxon" and the "Servicer"), IXIS Real Estate Capital Inc., as
unaffiliated seller (the "Unaffiliated Seller"), Deutsche Bank National Trust
Company, as trustee and custodian (in each such capacity, respectively, the
"Trustee" and the "Custodian") and Xxxxx Fargo Bank, National Association, as
securities administrator and master servicer (in each such capacity,
respectively, the "Securities Administrator" and the "Master Servicer"). To the
extent not defined herein, the capitalized terms used herein shall have the
meanings assigned to them in the Agreement. This Certificate is issued under and
is subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually authenticated by an
authorized signatory of the Securities Administrator.
* * *
B-3
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated: __________
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Securities Administrator
By:
------------------------------------
Authenticated:
By:
-----------------------------------
Authorized Signatory of
XXXXX FARGO BANK, NATIONAL
ASSOCIATION,
not in its individual capacity,
but solely as Certificate Registrar
B-4
XXXXXX XXXXXXX ABS CAPITAL I INC.
IXIS REAL ESTATE CAPITAL TRUST 2007-HE1
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2007-HE1
This Certificate is one of a duly authorized issue of Certificates
designated as IXIS Real Estate Capital Trust 2007-HE1 Mortgage Pass-Through
Certificates, Series 2007-HE1 (herein collectively called the "Certificates"),
and representing a beneficial ownership interest in the Trust Fund created by
the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Securities Administrator is not liable to the
Certificateholders for any amount payable under this Certificate or the
Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee and the Securities Administrator.
Pursuant to the terms of the Agreement, a distribution will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on the
first Distribution Date specified on the face hereof, to the Person in whose
name this Certificate is registered at the close of business on the applicable
Record Date in an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the amount required to be distributed to
Holders of Certificates of the Class to which this Certificate belongs on such
Distribution Date pursuant to the Agreement. The Record Date applicable to each
Distribution Date is the Business Day immediately preceding such Distribution
Date; provided, however, that for any Definitive Certificates, the Record Date
shall be the last Business Day of the month next preceding the month of such
Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Securities Administrator in writing at least five
Business Days prior to the related Record Date and such Certificateholder shall
satisfy the conditions to receive such form of payment set forth in the
Agreement, or, if not, by check mailed by first class mail to the address of
such Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the offices designated by the
Securities Administrator for such purposes, or such other location specified in
the notice to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Securities Administrator and the rights of the Certificateholders under the
Agreement at any time by the parties to the Agreement, with the consent of the
Holders of Certificates affected by such amendment evidencing the
B-5
requisite Percentage Interest, as provided in the Agreement. Any such consent by
the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange therefor or in lieu hereof whether or
not notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register of the Securities Administrator upon surrender of this
Certificate for registration of transfer at the offices designated by the
Securities Administrator for such purposes, accompanied by a written instrument
of transfer in form satisfactory to the Securities Administrator and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust Fund will be issued to the designated
transferee or transferees.
The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
The Depositor, the Servicer, the Unaffiliated Seller, the Securities
Administrator, the Master Servicer and the Trustee and any agent of any of them
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and no such party shall be affected by any notice to
the contrary.
On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans, as of the last day of the related Due Period, is
less than or equal to 5% of the Maximum Pool Principal Balance, the Servicer
and/or the Class X Certificateholders will have the option to repurchase, in
whole, from the Trust Fund all remaining Mortgage Loans and all property
acquired in respect of the Mortgage Loans at a purchase price determined as
provided in the Agreement. The obligations and responsibilities created by the
Agreement will terminate as provided in Section 11.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
B-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Securities Administrator to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
Dated: __________
Signature by or on behalf of assignor
B-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _____________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
account number _______, or, if mailed by check, to _____________________________
Applicable statements should be mailed to_______________________________________
________________________________________________________________________________
This information is provided by ________________________________________________
the assignee named above, or ___________________________________________________
as its agent.
B-8
EXHIBIT C
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEROR DELIVERS TO THE SECURITIES ADMINISTRATOR A TRANSFEROR LETTER
IN THE FORM OF EXHIBIT H TO THE AGREEMENT REFERRED TO HEREIN AND EITHER (I) THE
SECURITIES ADMINISTRATOR RECEIVES A RULE 144A LETTER IN THE FORM OF EXHIBIT I TO
THE AGREEMENT REFERRED TO HEREIN OR (II) THE SECURITIES ADMINISTRATOR RECEIVES
AN OPINION OF COUNSEL, DELIVERED AT THE EXPENSE OF THE TRANSFEROR, THAT SUCH
TRANSFER MAY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS
AMENDED.
EXCEPT AS PROVIDED IN THE AGREEMENT, NEITHER THIS CERTIFICATE NOR ANY INTEREST
HEREIN MAY BE TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE SECURITIES
ADMINISTRATOR A REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT
AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), SECTION 4975 OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR ANY FEDERAL,
STATE OR LOCAL LAW MATERIALLY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR
THE CODE, (EACH, A "PLAN"), AND IS NOT ACTING ON BEHALF OF ANY PLAN OR USING THE
ASSETS OF ANY PLAN TO EFFECT SUCH TRANSFER. ANY PURPORTED TRANSFER OF THIS
CERTIFICATE IN VIOLATION OF THE TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT
SHALL BE VOID AND OF NO EFFECT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN ONE OR MORE CLASSES OF "REGULAR INTERESTS" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT", AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN
SECTIONS 860G AND 860D OF THE CODE.
Certificate No. : P-1
Cut-off Date : January 1, 2007
First Distribution Date : February 26, 2007
Initial Certificate Balance of this
Certificate ("Denomination") : $100
Initial Certificate Balance of all
Certificates of this Class : $100
CUSIP : N/A
C-1
XXXXXX XXXXXXX ABS CAPITAL I INC.
IXIS REAL ESTATE CAPITAL TRUST 2007-HE1
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2007-HE1
CLASS P
evidencing a percentage interest in the distributions allocable to the
Certificates of the above-referenced Class.
Distributions in respect of this Certificate are distributable monthly as set
forth herein. This Certificate does not evidence an obligation of, or an
interest in, and is not guaranteed by the Depositor, the Unaffiliated Seller,
the Securities Administrator, the Master Servicer, any Originator, the Servicer
or the Trustee referred to below or any of their respective affiliates. Neither
this Certificate nor the Mortgage Loans are guaranteed or insured by any
governmental agency or instrumentality.
This certifies that XXXXX FARGO BANK, NATIONAL ASSOCIATION, AS INDENTURE TRUSTEE
is the registered owner of the Percentage Interest evidenced by this Certificate
(obtained by dividing the denomination of this Certificate by the aggregate of
the denominations of all Certificates of the Class to which this Certificate
belongs) in certain monthly distributions pursuant to a Pooling and Servicing
Agreement dated as of the Cut-off Date specified above (the "Agreement") among
Xxxxxx Xxxxxxx ABS Capital I Inc., as depositor (the "Depositor"), Saxon
Mortgage Services, Inc., as the servicer ("Saxon" and the "Servicer"), IXIS Real
Estate Capital Inc., as unaffiliated seller (the "Unaffiliated Seller"),
Deutsche Bank National Trust Company, as trustee and custodian (in each such
capacity, respectively, the "Trustee" and the "Custodian") and Xxxxx Fargo Bank,
National Association, as securities administrator and master servicer (in each
such capacity, respectively, the "Securities Administrator" and the "Master
Servicer"). To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
This Certificate does not have a Pass-Through Rate and will be entitled to
distributions only to the extent set forth in the Agreement. In addition, any
distribution of the proceeds of any remaining assets of the Trust will be made
only upon presentment and surrender of this Certificate at the offices
designated by the Securities Administrator for such purposes, or such other
location specified in the notice to Certificateholders of such final
distribution.
No transfer of a Certificate of this Class shall be made unless such disposition
is exempt from the registration requirements of the Securities Act of 1933, as
amended (the "1933 Act"), and any applicable state securities laws or is made in
accordance with the 1933 Act and such laws. In the event of any such transfer,
the Securities Administrator shall require the transferor to execute a
transferor certificate (in substantially the form attached to the Agreement) and
deliver either (i) a Rule 144A Letter, in either case substantially in the form
attached to the Agreement, or (ii) a written Opinion of Counsel to the
Securities Administrator that such transfer may be made pursuant to an
exemption, describing the applicable exemption and the basis therefor, from the
C-2
1933 Act or is being made pursuant to the 1933 Act, which Opinion of Counsel
shall be an expense of the transferor.
Except as provided in the Agreement, no transfer of a Certificate of this Class
shall be made unless the Securities Administrator shall have received a
representation letter from the transferee of this Certificate, acceptable to and
in form and substance satisfactory to the Securities Administrator, to the
effect that such transferee is not a Plan, and is not acting on behalf of any
Plan or using the assets of any Plan to effect such transfer. Any purported
transfer of a Certificate of this Class in violation of the transfer
restrictions set forth in the Agreement shall be void and of no effect.
Reference is hereby made to the further provisions of this Certificate set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement or be
valid for any purpose unless manually authenticated by an authorized signatory
of the Securities Administrator.
* * *
C-3
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed. Dated: __________
XXXXX FARGO BANK, NATIONAL
ASSOCIATION, not in its individual
capacity, but solely as Securities
Administrator
By:
------------------------------------
Authenticated:
By:
------------------------------------
Authorized Signatory of
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Certificate Registrar
C-4
XXXXXX XXXXXXX ABS CAPITAL I INC.
IXIS REAL ESTATE CAPITAL TRUST 2007-HE1
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2007-HE1
This Certificate is one of a duly authorized issue of Certificates designated as
IXIS Real Estate Capital Trust 2007-HE1 Mortgage Pass-Through Certificates,
Series 2007-HE1 (herein collectively called the "Certificates"), and
representing a beneficial ownership interest in the Trust Fund created by the
Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that it
will look solely to the funds on deposit in the Distribution Account for payment
hereunder and that the Securities Administrator is not liable to the
Certificateholders for any amount payable under this Certificate or the
Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement.
This Certificate does not purport to summarize the Agreement and reference is
made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Securities Administrator.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th
day of each month or, if such 25th day is not a Business Day, the Business Day
immediately following (the "Distribution Date"), commencing on the first
Distribution Date specified on the face hereof, to the Person in whose name this
Certificate is registered at the close of business on the applicable Record Date
in an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to Holders of Certificates
of the Class to which this Certificate belongs on such Distribution Date
pursuant to the Agreement. The Record Date applicable to each Distribution Date
is the last Business Day of the month next preceding the month of such
Distribution Date.
Distributions on this Certificate shall be made by wire transfer of immediately
available funds to the account of the Holder hereof at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have so
notified the Securities Administrator in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment and
surrender of such Certificate at the offices designated by the Securities
Administrator for such purposes or such other location specified in the notice
to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Trustee, the
Securities Administrator and the rights of the Certificateholders under the
Agreement at any time by the parties to the Agreement, with the consent of the
Holders of Certificates affected by such amendment evidencing the requisite
Percentage Interest, as provided in the Agreement. Any such consent by the
Holder of this Certificate shall be conclusive and binding on such Holder and
upon all future Holders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange therefor or
C-5
in lieu hereof whether or not notation of such consent is made upon this
Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register of the Securities Administrator upon surrender of this Certificate for
registration of transfer at the offices designated by the Securities
Administrator for such purposes, accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator and the Certificate
Registrar duly executed by the holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations and evidencing the same aggregate Percentage
Interest in the Trust Fund will be issued to the designated transferee or
transferees.
The Certificates are issuable only as registered Certificates without coupons in
denominations specified in the Agreement. As provided in the Agreement and
subject to certain limitations therein set forth, Certificates are exchangeable
for new Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
The Depositor, the Servicer, the Unaffiliated Seller, the Securities
Administrator, the Master Servicer and the Trustee and any agent of any of them
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and no such party shall be affected by any notice to
the contrary.
On any Distribution Date on which the aggregate Stated Principal Balance of the
Mortgage Loans, as of the last day of the related Due Period, is less than or
equal to 5% of the Maximum Pool Principal Balance, the Servicer and/or the Class
X Certificateholders will have the option to repurchase, in whole, from the
Trust Fund all remaining Mortgage Loans and all property acquired in respect of
the Mortgage Loans at a purchase price determined as provided in the Agreement.
The obligations and responsibilities created by the Agreement will terminate as
provided in Section 11.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning.
C-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Securities Administrator to issue a new Certificate of
a like denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
________________________________________________________________________________
Dated: __________
----------------------------------------
Signature by or on behalf of assignor
C-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ________________________________________________,
_______________________________________________________________________________,
for the account of ____________________________________________________________,
account number ________, or, if mailed by check, to ___________________________,
Applicable statements should be mailed to _____________________________________,
_______________________________________________________________________________.
This information is provided by _____________________________________,
the assignee named above, or __________________________________________________,
as its agent.
C-8
EXHIBIT D
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS "RESIDUAL
INTERESTS" IN FIVE "REAL ESTATE MORTGAGE INVESTMENT CONDUITS" ("REMICs") AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), ASSUMING COMPLIANCE WITH THE
REMIC PROVISIONS (SECTIONS 860A THROUGH 860G) OF THE CODE.
TRANSFER OF THIS CLASS R CERTIFICATE IS RESTRICTED AS SET FORTH IN THE POOLING
AND SERVICING AGREEMENT. NO TRANSFER OF THIS CLASS R CERTIFICATE MAY BE MADE TO
A "DISQUALIFIED ORGANIZATION" AS DEFINED IN SECTION 860E(5) OF THE CODE. SUCH
TERM INCLUDES THE UNITED STATES, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY
FOREIGN GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, ANY AGENCY OR
INSTRUMENTALITY OF ANY OF THE FOREGOING (OTHER THAN CERTAIN TAXABLE
INSTRUMENTALITIES), ANY COOPERATIVE ORGANIZATION FURNISHING ELECTRIC ENERGY OR
PROVIDING THEREOF SERVICE TO PERSONS IN RURAL AREAS, OR ANY ORGANIZATION (OTHER
THAN A FARMERS' COOPERATIVE) THAT IS EXEMPT FROM FEDERAL INCOME TAX UNLESS SUCH
ORGANIZATION IS SUBJECT TO THE TAX ON UNRELATED BUSINESS INCOME. NO TRANSFER OF
THIS CLASS R CERTIFICATE WILL BE REGISTERED BY THE TRUSTEE UNLESS THE PROPOSED
TRANSFEREE HAS DELIVERED AN AFFIDAVIT AFFIRMING, AMONG OTHER THINGS, THAT THE
PROPOSED TRANSFEREE IS NOT A DISQUALIFIED ORGANIZATION AND IS NOT ACQUIRING THE
CLASS R CERTIFICATE FOR THE ACCOUNT OF A DISQUALIFIED ORGANIZATION. A COPY OF
THE FORM OF AFFIDAVIT REQUIRED OF EACH PROPOSED TRANSFEREE IS ON FILE AND
AVAILABLE FROM THE TRUSTEE.
A TRANSFER IN VIOLATION OF THE APPLICABLE RESTRICTIONS MAY GIVE RISE TO A
SUBSTANTIAL TAX UPON THE TRANSFEROR OR, IN CERTAIN CASES, UPON AN AGENT ACTING
FOR THE TRANSFEREE. A PASS-THRU ENTITY THAT HOLDS THIS CLASS R CERTIFICATE AND
THAT HAS A DISQUALIFIED ORGANIZATION AS A RECORD OWNER IN ANY TAXABLE YEAR
GENERALLY WILL BE SUBJECT TO A TAX FOR EACH SUCH YEAR EQUAL TO THE PRODUCT OF
(A) THE AMOUNT OF EXCESS INCLUSIONS WITH RESPECT TO THE PORTION OF THIS
CERTIFICATE OWNED THROUGH SUCH PASS-THRU ENTITY BY SUCH DISQUALIFIED
ORGANIZATION AND (B) THE HIGHEST MARGINAL FEDERAL TAX RATE ON CORPORATIONS. FOR
PURPOSES OF THE PRECEDING SENTENCE, THE TERM "PASS-THRU" ENTITY INCLUDES
REGULATED INVESTMENT COMPANIES, REAL ESTATE INVESTMENT TRUSTS, COMMON TRUST
FUNDS, PARTNERSHIPS, TRUSTS, ESTATES, COOPERATIVES TO WHICH PART I OF SUBCHAPTER
T, CHAPTER 1 OF THE CODE APPLIES AND, EXCEPT AS PROVIDED IN REGULATIONS,
NOMINEES.
D-1
EXCEPT AS PROVIDED IN THE AGREEMENT, NEITHER THIS CERTIFICATE NOR ANY INTEREST
HEREIN MAY BE TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE SECURITIES
ADMINISTRATOR A REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT
AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), SECTION 4975 OF
CODE, OR ANY FEDERAL, STATE OR LOCAL LAW MATERIALLY SIMILAR TO THE FOREGOING
PROVISIONS OF ERISA OR THE CODE (EACH, A "PLAN"), AND IS NOT ACTING ON BEHALF OF
ANY PLAN OR USING THE ASSETS OF ANY PLAN TO EFFECT SUCH TRANSFER. ANY PURPORTED
TRANSFER OF THIS CERTIFICATE IN VIOLATION OF THE TRANSFER RESTRICTIONS SET FORTH
IN THE AGREEMENT SHALL BE VOID AND OF NO EFFECT.
Certificate No. : R-1
Cut-off Date : January 1, 2007
First Distribution Date : February 26, 2007
Percentage Interest of this
Certificate ("Denomination") : 100%
CUSIP : N/A
D-2
XXXXXX XXXXXXX ABS CAPITAL I INC.
IXIS REAL ESTATE CAPITAL TRUST 2007-HE1
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2007-HE1
CLASS R
evidencing a percentage interest in the distributions allocable to the
Certificates of the above-referenced Class.
Distributions in respect of this Certificate are distributable monthly as set
forth herein. This Class R Certificate has no Certificate Balance and is not
entitled to distributions in respect of principal or interest. This Certificate
does not evidence an obligation of, or an interest in, and is not guaranteed by
the Depositor, the Unaffiliated Seller, the Securities Administrator, the Master
Servicer, any Originator, the Servicer or the Trustee referred to below or any
of their respective affiliates. Neither this Certificate nor the Mortgage Loans
are guaranteed or insured by any governmental agency or instrumentality.
This certifies that IXIS REAL ESTATE CAPITAL INC. is the registered owner of the
Percentage Interest specified above of any monthly distributions due to the
Class R Certificates pursuant to a Pooling and Servicing Agreement dated as of
the Cut-off Date specified above (the "Agreement") among Xxxxxx Xxxxxxx ABS
Capital I Inc., as depositor (the "Depositor"), Saxon Mortgage Services, Inc.,
as the servicer ("Saxon" and the "Servicer"), IXIS Real Estate Capital Inc., as
unaffiliated seller (the "Unaffiliated Seller"), Deutsche Bank National Trust
Company, as trustee and custodian (in each such capacity, respectively, the
"Trustee" and the "Custodian") and Xxxxx Fargo Bank, National Association, as
securities administrator and master servicer (in each such capacity,
respectively, the "Securities Administrator" and the "Master Servicer"). To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Any distribution of the proceeds of any remaining assets of the Trust Fund will
be made only upon presentment and surrender of this Class R Certificate at the
offices designated by the Securities Administrator for such purposes or such
other location specified in the notice to Certificateholders of such final
distribution.
Except as provided in the Agreement, no transfer of a Class R Certificate shall
be made unless the Securities Administrator shall have received a representation
letter from the transferee of this Certificate, acceptable to and in form and
substance satisfactory to the Securities Administrator, to the effect that such
transferee is not a Plan, and is not acting on behalf of any Plan or using the
assets of any Plan to effect such transfer. Any purported transfer of a Class R
Certificate in violation of the transfer restrictions set forth in the Agreement
shall be void and of no effect.
Each Holder of this Class R Certificate shall be deemed by the acceptance or
acquisition of an Ownership Interest in this Class R Certificate to have agreed
to be bound by the following provisions, and the rights of each Person acquiring
any Ownership Interest in this Class R Certificate are expressly subject to the
following provisions: (i) each Person holding or
D-3
acquiring any Ownership Interest in this Class R Certificate shall be a
Permitted Transferee and shall promptly notify the Securities Administrator of
any change or impending change in its status as a Permitted Transferee, (ii) no
Ownership Interest in this Class R Certificate may be registered on the Closing
Date or thereafter transferred, and the Securities Administrator shall not
register the Transfer of this Certificate unless, in addition to the
certificates required to be delivered to the Securities Administrator under
Section 5.02(b) of the Agreement, the Securities Administrator shall have been
furnished with a Transfer Affidavit of the initial owner or the proposed
transferee in the form attached as Exhibit H to the Agreement, (iii) each Person
holding or acquiring any Ownership Interest in this Class R Certificate shall
agree (A) to obtain a Transfer Affidavit from any other Person to whom such
Person attempts to Transfer its Ownership Interest this Class R Certificate, (B)
to obtain a Transfer Affidavit from any Person for whom such Person is acting as
nominee, trustee or agent in connection with any Transfer of this Class R
Certificate and (C) not to Transfer the Ownership Interest in this Class R
Certificate or to cause the Transfer of the Ownership Interest in this Class R
Certificate to any other Person if it has actual knowledge that such Person is a
Non-Permitted Transferee and (iv) any attempted or purported Transfer of the
Ownership Interest in this Class R Certificate in violation of the provisions
herein shall be absolutely null and void and shall vest no rights in the
purported Transferee.
Reference is hereby made to the further provisions of this Certificate set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement or be
valid for any purpose unless manually authenticated by an authorized signatory
of the Securities Administrator.
D-4
IN WITNESS WHEREOF, the Securities Administrator has caused this Certificate to
be duly executed.
Dated: ________________
XXXXX FARGO BANK, NATIONAL
ASSOCIATION, not in its individual
capacity, but solely as Securities
Administrator
By:
------------------------------------
Authenticated:
By:
------------------------------------
Authorized Signatory of
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Certificate Xxxxxxxxx
X-0
XXXXXX XXXXXXX ABS CAPITAL I INC.
IXIS REAL ESTATE CAPITAL TRUST 2007-HE1
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2007-HE1
This Certificate is one of a duly authorized issue of Certificates designated as
IXIS Real Estate Capital Trust 2007-HE1 Mortgage Pass-Through Certificates,
Series 2007-HE1 (herein collectively called the "Certificates"), and
representing a beneficial ownership interest in the Trust Fund created by the
Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that it
will look solely to the funds on deposit in the Distribution Account for payment
hereunder and that the Securities Administrator is not liable to the
Certificateholders for any amount payable under this Certificate or the
Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement.
This Certificate does not purport to summarize the Agreement and reference is
made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Securities Administrator.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th
day of each month or, if such day is not a Business Day, the Business Day
immediately following (the "Distribution Date"), commencing on the first
Distribution Date specified on the face hereof, to the Person in whose name this
Certificate is registered at the close of business on the applicable Record Date
in an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to Holders of Certificates
of the Class to which this Certificate belongs on such Distribution Date
pursuant to the Agreement. The Record Date applicable to each Distribution Date
is the last Business Day of the month next preceding the month of such
Distribution Date.
Distributions on this Certificate shall be made by wire transfer of immediately
available funds to the account of the Holder hereof at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have so
notified the Securities Administrator in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment and
surrender of such Certificate at the offices designated by the Securities
Administrator for such purposes or such other location specified in the notice
to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Trustee, the
Securities Administrator and the rights of the Certificateholders under the
Agreement at any time by the parties to the Agreement, with the consent of the
Holders of Certificates affected by such amendment evidencing the requisite
Percentage Interest, as provided in the Agreement. Any such consent by the
Holder of this Certificate shall be conclusive and binding on such Holder and
upon all future Holders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange therefor or
D-6
in lieu hereof whether or not notation of such consent is made upon this
Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register of the Securities Administrator upon surrender of this Certificate for
registration of transfer at the offices designated by the Securities
Administrator for such purposes, accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator and the Certificate
Registrar duly executed by the holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations and evidencing the same aggregate Percentage
Interest in the Trust Fund will be issued to the designated transferee or
transferees.
The Certificates are issuable only as registered Certificates without coupons in
denominations specified in the Agreement. As provided in the Agreement and
subject to certain limitations therein set forth, Certificates are exchangeable
for new Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
The Depositor, the Servicer, the Securities Administrator, the Master Servicer,
the Unaffiliated Seller and the Trustee and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and no such party shall be affected by any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal Balance of the
Mortgage Loans, as of the last day of the related Due Period, is less than or
equal to 5% of the Maximum Pool Principal Balance, the Servicer and/or the Class
X Certificateholder will have the option to repurchase, in whole, from the Trust
Fund all remaining Mortgage Loans and all property acquired in respect of the
Mortgage Loans at a purchase price determined as provided in the Agreement. The
obligations and responsibilities created by the Agreement will terminate as
provided in Section 11.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning.
D-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto ____________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Securities Administrator to issue a new Certificate of
a like denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
________________________________________________________________________________
Dated: ____________
----------------------------------------
Signature by or on behalf of assignor
D-8
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ________________________________________________,
_______________________________________________________________________________,
for the account of ____________________________________________________________,
account number _______, or, if mailed by check, to ____________________________,
Applicable statements should be mailed to _____________________________________,
_______________________________________________________________________________.
This information is provided by _____________________________, the
assignee named above, or __________________________________________________, as
its agent.
D-9
EXHIBIT E
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN ONE OR MORE CLASSES OF "REGULAR INTERESTS" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN
SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER ASSETS.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEROR DELIVERS TO THE SECURITIES ADMINISTRATOR A TRANSFEROR LETTER
IN THE FORM OF EXHIBIT I TO THE AGREEMENT REFERRED TO HEREIN AND EITHER (I) THE
SECURITIES ADMINISTRATOR RECEIVES A RULE 144A LETTER IN THE FORM OF EXHIBIT J TO
THE AGREEMENT REFERRED TO HEREIN OR (II) THE SECURITIES ADMINISTRATOR RECEIVES
AN OPINION OF COUNSEL, DELIVERED AT THE EXPENSE OF THE TRANSFEROR, THAT SUCH
TRANSFER MAY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS
AMENDED.
EXCEPT AS PROVIDED IN THE AGREEMENT, NEITHER THIS CERTIFICATE NOR ANY INTEREST
HEREIN MAY BE TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE SECURITIES
ADMINISTRATOR A REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT
AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), SECTION 4975 OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR ANY FEDERAL,
STATE OR LOCAL LAW MATERIALLY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR
THE CODE (EACH, A "PLAN"), AND IS NOT ACTING ON BEHALF OF ANY PLAN OR USING THE
ASSETS OF ANY PLAN TO EFFECT SUCH TRANSFER. ANY PURPORTED TRANSFER OF THIS
CERTIFICATE IN VIOLATION OF THE TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT
SHALL BE VOID AND OF NO EFFECT.
Certificate No. : X-1
Cut-off Date : January 1, 2007
First Distribution Date : February 26, 2007
Percentage Interest of this
Certificate ("Denomination") : 100%
CUSIP : N/A
E-1
XXXXXX XXXXXXX ABS CAPITAL I INC.
IXIS REAL ESTATE CAPITAL TRUST 2007-HE1
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2007-HE1
CLASS X
evidencing a percentage interest in the distributions allocable to the
Certificates of the above-referenced Class.
Distributions in respect of this Certificate are distributable monthly as set
forth herein. This Certificate does not evidence an obligation of, or an
interest in, and is not guaranteed by the Depositor, the Unaffiliated Seller,
the Securities Administrator, the Master Servicer, any Originator, the Servicer
or the Trustee referred to below or any of their respective affiliates. Neither
this Certificate nor the Mortgage Loans are guaranteed or insured by any
governmental agency or instrumentality.
This certifies that XXXXX FARGO BANK, NATIONAL ASSOCIATION, AS INDENTURE TRUSTEE
is the registered owner of the Percentage Interest evidenced by this Certificate
(obtained by dividing the denomination of this Certificate by the aggregate of
the denominations of all Certificates of the Class to which this Certificate
belongs) in certain monthly distributions pursuant to a Pooling and Servicing
Agreement dated as of the Cut-off Date specified above (the "Agreement") among
Xxxxxx Xxxxxxx ABS Capital I Inc., as depositor (the "Depositor"), Saxon
Mortgage Services, Inc., as the servicer ("Saxon" and the "Servicer"), IXIS Real
Estate Capital Inc., as unaffiliated seller (the "Unaffiliated Seller"),
Deutsche Bank National Trust Company, as trustee and custodian (in each such
capacity, respectively, the "Trustee" and the "Custodian") and Xxxxx Fargo Bank,
National Association, as securities administrator and master servicer (in each
such capacity, respectively, the "Securities Administrator" and the "Master
Servicer"). To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
This Certificate does not have a Certificate Balance or a Pass-Through Rate and
will be entitled to distributions only to the extent set forth in the Agreement.
In addition, any distribution of the proceeds of any remaining assets of the
Trust will be made only upon presentment and surrender of this Certificate at
the offices designated by the Securities Administrator for such purposes, or
such other location specified in the notice to Certificateholders of such final
distribution.
No transfer of a Certificate of this Class shall be made unless such disposition
is exempt from the registration requirements of the Securities Act of 1933, as
amended (the "1933 Act"), and any applicable state securities laws or is made in
accordance with the 1933 Act and such laws. In the event of any such transfer,
the Securities Administrator shall require the transferor to execute a
transferor certificate (in substantially the form attached to the Agreement) and
deliver either (i) a Rule 144A Letter, in either case substantially in the form
attached to the Agreement, or (ii) a written Opinion of Counsel to the
Securities Administrator that such transfer may be made pursuant to an
exemption, describing the applicable exemption and the basis therefor, from the
X-0
0000 Xxx or is being made pursuant to the 1933 Act, which Opinion of Counsel
shall be an expense of the transferor.
Except as provided in the Agreement, no transfer of a Certificate of this Class
shall be made unless the Securities Administrator shall have received a
representation letter from the transferee of this Certificate, acceptable to and
in form and substance satisfactory to the Securities Administrator, to the
effect that such transferee is not a Plan, and is not acting on behalf of any
Plan or using the assets of any Plan to effect such transfer. Any purported
transfer of a Certificate of this Class in violation of the transfer
restrictions set forth in the Agreement shall be void and of no effect.
Reference is hereby made to the further provisions of this Certificate set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement or be
valid for any purpose unless manually authenticated by an authorized signatory
of the Securities Administrator.
* * *
E-3
IN WITNESS WHEREOF, the Securities Administrator has caused this Certificate to
be duly executed.
Dated: ___________
XXXXX FARGO BANK, NATIONAL
ASSOCIATION, not in its individual
capacity, but solely as Securities
Administrator
By:
------------------------------------
Authenticated:
By:
-----------------------------------
Authorized Signatory of
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Certificate Registrar
E-4
XXXXXX XXXXXXX ABS CAPITAL I INC.
IXIS REAL ESTATE CAPITAL TRUST 2007-HE1
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2007-HE1
This Certificate is one of a duly authorized issue of Certificates designated as
IXIS Real Estate Capital Trust 2007-HE1 Mortgage Pass-Through Certificates,
Series 2007-HE1 (herein collectively called the "Certificates"), and
representing a beneficial ownership interest in the Trust Fund created by the
Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that it
will look solely to the funds on deposit in the Distribution Account for payment
hereunder and that the Securities Administrator is not liable to the
Certificateholders for any amount payable under this Certificate or the
Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement.
This Certificate does not purport to summarize the Agreement and reference is
made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Securities Administrator.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th
day of each month or, if such 25th day is not a Business Day, the Business Day
immediately following (the "Distribution Date"), commencing on the first
Distribution Date specified on the face hereof, to the Person in whose name this
Certificate is registered at the close of business on the applicable Record Date
in an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to Holders of Certificates
of the Class to which this Certificate belongs on such Distribution Date
pursuant to the Agreement. The Record Date applicable to each Distribution Date
is the last Business Day of the month next preceding the month of such
Distribution Date.
Distributions on this Certificate shall be made by wire transfer of immediately
available funds to the account of the Holder hereof at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have so
notified the Securities Administrator in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment and
surrender of such Certificate at the offices designated by the Securities
Administrator for such purposes or such other location specified in the notice
to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Trustee, the
Securities Administrator and the rights of the Certificateholders under the
Agreement at any time by the parties to the Agreement, with the consent of the
Holders of Certificates affected by such amendment evidencing the requisite
Percentage Interest, as provided in the Agreement. Any such consent by the
Holder of this Certificate shall be conclusive and binding on such Holder and
upon all future Holders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange therefor or
E-5
in lieu hereof whether or not notation of such consent is made upon this
Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register of the Securities Administrator upon surrender of this Certificate for
registration of transfer at the offices designated by the Securities
Administrator for such purposes, accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator and the Certificate
Registrar duly executed by the holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations and evidencing the same aggregate Percentage
Interest in the Trust Fund will be issued to the designated transferee or
transferees.
The Certificates are issuable only as registered Certificates without coupons in
denominations specified in the Agreement. As provided in the Agreement and
subject to certain limitations therein set forth, Certificates are exchangeable
for new Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
The Depositor, the Servicer, the Unaffiliated Seller, the Securities
Administrator, the Master Servicer and the Trustee and any agent of any of them
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and no such party shall be affected by any notice to
the contrary.
On any Distribution Date on which the aggregate Stated Principal Balance of the
Mortgage Loans, as of the last day of the related Due Period, is less than or
equal to 5% of the Maximum Pool Principal Balance, the Servicer and/or the Class
X Certificateholders will have the option to repurchase, in whole, from the
Trust Fund all remaining Mortgage Loans and all property acquired in respect of
the Mortgage Loans at a purchase price determined as provided in the Agreement.
The obligations and responsibilities created by the Agreement will terminate as
provided in Section 11.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning.
E-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Securities Administrator to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
_______________________________________________________________________________.
Dated: __________
----------------------------------------
Signature by or on behalf of assignor
E-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ________________________________________________,
_______________________________________________________________________________,
for the account of ____________________________________________________________,
account number _______, or, if mailed by check, to ____________________________,
Applicable statements should be mailed to _____________________________________,
_______________________________________________________________________________.
This information is provided by _______________________________________________,
the assignee named above, or __________________________________________________,
as its agent.
E-8
EXHIBIT F
FORM OF INITIAL CERTIFICATION OF CUSTODIAN
[DATE]
Xxxxxx Xxxxxxx ABS Capital I Inc.
0000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Saxon Mortgage Services, Inc.
0000 Xxxxxxxxxx Xxxxx,
Xxxx Xxxxx, Xxxxx 00000
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank, National Association
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Deutsche Bank National Trust Company
0000 Xxxx Xx. Xxxxxx Xxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000-0000
Re: Pooling and Servicing Agreement, dated as of January 1, 2007 (the
"Pooling and Servicing Agreement"), among IXIS Real Estate Capital
Inc., as unaffiliated seller, Saxon Mortgage Services, Inc., as
servicer, Xxxxx Fargo Bank, National Association, as securities
administrator and master servicer, and Deutsche Bank National Trust
Company, as trustee and custodian of the IXIS Real Estate Capital
Trust 2007-HE1
Ladies and Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement, for each Mortgage Loan listed in the Mortgage Loan Schedule
(other than any Mortgage Loan listed in the attached schedule), it has received:
(i) the original Mortgage Note, endorsed as provided in the following
form: "Pay to the order of ________, without recourse"; and
(ii) an executed assignment of the Mortgage (which may be included in
a blanket assignment or assignments) except for the MERS Designated
Mortgage Loans.
F-1
Based on its review and examination and only as to the foregoing
documents, such documents appear regular on their face and related to such
Mortgage Loan.
The Custodian has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
Pooling and Servicing Agreement. The Custodian makes no representations as to:
(i) the validity, legality, sufficiency, enforceability or genuineness of any of
the documents contained in each Mortgage File of any of the Mortgage Loans
identified on the Mortgage Loan Schedule, or (ii) the collectability,
insurability, perfection, priority, effectiveness or suitability of any such
Mortgage Loan. Notwithstanding anything herein to the contrary, the Custodian
has made no determination and makes no representations as to whether (i) any
endorsement is sufficient to transfer all right, title and interest of the party
so endorsing, as Noteholder or assignee thereof, in and to that Mortgage Note or
(ii) any assignment is in recordable form or sufficient to effect the assignment
of and transfer to the assignee thereof, under the Mortgage to which the
assignment relates.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement.
DEUTSCHE BANK NATIONAL TRUST COMPANY,
as Custodian
By:
------------------------------------
Name:
Title:
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EXHIBIT G
FORM OF FINAL CERTIFICATION OF CUSTODIAN
[DATE]
Xxxxxx Xxxxxxx ABS Capital I Inc.
0000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Saxon Mortgage Services, Inc.
0000 Xxxxxxxxxx Xxxxx,
Xxxx Xxxxx, Xxxxx 00000
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank, National Association
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Deutsche Bank National Trust Company
0000 Xxxx Xx. Xxxxxx Xxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000-0000
----------
Re: Pooling and Servicing Agreement, dated as of January 1, 2007, among
Xxxxxx Xxxxxxx ABS Capital I Inc., as Depositor, Saxon Mortgage
Services, Inc., as the Servicer, IXIS Real Estate Capital Inc., as
Unaffiliated Seller, Deutsche Bank National Trust Company, as Trustee
and Custodian and Xxxxx Fargo Bank, National Association, as
Securities Administrator and Master Servicer, IXIS Real Estate Capital
Trust Series 2007-HE1
Ladies and Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), the undersigned, as
Custodian, hereby certifies that as to each Mortgage Loan listed in the Mortgage
Loan Schedule (other than any Mortgage Loan paid in full or listed on the
attached Document Exception Report) it has received:
(i) The original Mortgage Note, endorsed in the form provided in
Section 2.01 of the Pooling and Servicing Agreement, with all intervening
endorsements showing a complete chain of endorsement from the originator to
the last endorsee.
(ii) The original recorded Mortgage.
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(iii) Except with respect to MERS Designated Mortgage Loans, a duly
executed assignment of the Mortgage in the form provided in Section 2.01 of
the Pooling and Servicing Agreement; or, if the Unaffiliated Seller has
certified or the Custodian otherwise knows that the related Mortgage has
not been returned from the applicable recording office, a copy of the
assignment of the Mortgage (excluding information to be provided by the
recording office).
(iv) Except with respect to MERS Designated Mortgage Loans, the
original or duplicate original recorded assignment or assignments of the
Mortgage showing a complete chain of assignment from the originator to the
last endorsee.
(v) The original or duplicate lender's title policy and all riders
thereto or, if such original is unavailable, any one of an original title
binder, either an original title binder or an original or copy of the title
commitment, and if copies then certified to be true and complete by the
title company.
Based on its review and examination and only as to the foregoing documents, (a)
such documents appear regular on their face and related to such Mortgage Loan,
and (b) the information set forth in items (1), (2) and (18) of the Mortgage
Loan Schedule and items (1), (9) and (17) of the Data Tape Information
accurately reflects information set forth in the Custodial File.
The Custodian has made no independent examination of any documents contained in
each Mortgage File beyond the review of the Custodial File specifically required
in the Pooling and Servicing Agreement. The Custodian makes no representations
as to: (i) the validity, legality, sufficiency, enforceability or genuineness of
any of the documents contained in each Mortgage File of any of the Mortgage
Loans identified on the Mortgage Loan Schedule, or (ii) the collectability,
insurability, perfection, priority, effectiveness or suitability of any such
Mortgage Loan. Notwithstanding anything herein to the contrary, the Custodian
has made no determination and makes no representations as to whether (i) any
endorsement is sufficient to transfer all right, title and interest of the party
so endorsing, as Noteholder or assignee thereof, in and to that Mortgage Note or
(ii) any assignment is in recordable form or sufficient to effect the assignment
of and transfer to the assignee thereof, under the Mortgage to which the
assignment relates.
Capitalized words and phrases used herein shall have the respective meanings
assigned to them in the Pooling and Servicing Agreement.
DEUTSCHE BANK NATIONAL TRUST COMPANY,
as Custodian,
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
G-2
EXHIBIT H
RESIDUAL TRANSFER AFFIDAVIT
IXIS REAL ESTATE CAPITAL TRUST 2007-HE1,
MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2007-HE1
STATE OF )
) ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is an officer of ___________________, the proposed Transferee
of an Ownership Interest in a Class R Certificate (the "Certificate") issued
pursuant to the Pooling and Servicing Agreement dated as of January 1, 2007 (the
"Agreement"), relating to the above-referenced Series, by and among Xxxxxx
Xxxxxxx ABS Capital I Inc., as depositor (the "Depositor"), Saxon Mortgage
Services Inc., as the servicer ("Saxon" and the "Servicer"), IXIS Real Estate
Capital Inc., as unaffiliated seller (the "Unaffiliated Seller"), Deutsche Bank
National Trust Company, as trustee and custodian (in each such capacity,
respectively, the "Trustee" and the "Custodian") and Xxxxx Fargo Bank, National
Association, as securities administrator and master servicer (in each such
capacity, respectively, the "Securities Administrator" and the "Master
Servicer"). Capitalized terms used, but not defined herein or in Exhibit 1
hereto, shall have the meanings ascribed to such terms in the Agreement. The
Transferee has authorized the undersigned to make this affidavit on behalf of
the Transferee for the benefit of the Depositor and the Securities
Administrator.
2. The Transferee is not, as of the date hereof, and will not be, as of the date
of the Transfer, a "disqualified organization" within the meaning of Section
860E(e)(5) of the Internal Revenue Code of 1986. The Transferee will endeavor to
remain other than a disqualified organization for so long as it retains its
Ownership Interest in the Certificate.
3. The Transferee has historically paid its debts as they came due and will
continue to pay its debts as they come due in the future.
4. The Transferee has no present knowledge or expectation that it will be unable
to pay any United States taxes owed by it or become insolvent or subject to a
bankruptcy proceeding for so long as the Certificate remains outstanding.
5. The Transferee has been advised of, and understands that as the holder of a
noneconomic residual interest it may incur tax liabilities in excess of any cash
flows generated by the interest. The Transferee intends to pay such taxes
associated with holding the Certificate as they become due.
6. The Transferee will not cause income from the Certificate to be attributable
to a foreign permanent establishment or fixed base (within the meaning of an
applicable income tax treaty) of the Transferee or another U.S. taxpayer.
H-1
(1)7. [A. Formula Test] The Transferee agrees that the present value of the
anticipated tax liabilities associated with holding the Certificate does not
exceed the sum of the present value of any consideration given to the Transferee
to acquire the Certificate, the present value of the expected future
distributions on the Certificate, and the present value of the anticipated tax
savings associated with holding the interest as the REMIC generates losses. The
Transferee agrees that it complied with U.S. Treasury regulations section
1.860E-1(c)(8) in making such representation.
The Transferee agrees that it is not a foreign permanent establishment or
fixed base (within the meaning of an applicable income tax treaty) of the
Transferor or another U.S. taxpayer.
[B. Asset Test] The Transferee, at the time of the transfer, and at the
close of the Transferee's two fiscal years preceding the year of the transfer,
had gross assets for financial reporting purposes in excess of $100 million and
net assets in excess of $10 million (excluding any obligation of a person
related to the Transferee within the meaning of U.S. Treasury regulations
section 1.860E-1(c)(6)(ii) or any other asset if a principle purpose for holding
or acquiring the other asset was to permit the Transferee to satisfy the above
stated minimum asset requirements).
The Transferee is an "eligible corporation," as defined in U.S. Treasury
regulations section 1.860E-1(c)(6)(i). The Transferee agrees, in connection with
any subsequent transfer of its Ownership Interest in the Certificate, to
transfer its Ownership Interest only to another "eligible corporation," as
defined in U.S. Treasury regulations section 1.860E-1(c)(6)(i), and to honor the
restrictions on subsequent transfers of the Certificate by transferring its
Ownership Interest only in a transaction that satisfies the requirements of U.S.
Treasury regulations section 1.860E-1(c)(4)(i), (ii) (iii) and U.S. Treasury
regulations section 1.860E-1(c)(5).
The Transferee determined the consideration paid to it to acquire the
Certificate in good faith and based on reasonable market assumptions (including,
but not limited to, borrowing and investment rates, prepayment and loss
assumptions, expense and reinvestment assumptions, tax rates and other factors
specific to the Transferee).
8. The Transferee is a citizen or resident of the United States, a corporation,
partnership or other entity created or organized in, or under the laws of, the
United States or any political subdivision thereof, or an estate or trust whose
income from sources without the United States is includable in gross income for
United States federal income tax purposes regardless of its connection with the
conduct of a trade or business within the United States.
9. The Transferee's taxpayer identification number is ____________.
10. The Transferee is not a Plan and is not acting on behalf of any Plan, or
using the assets of any Plan to effect the Transfer.
----------
(1) Insert either section 7A or 7B.
H-2
11. The Transferee has reviewed the provisions of Section 5.02(c) of the
Agreement and understands the legal consequences of the acquisition of an
Ownership Interest in the Certificate, including, without limitation, the
restrictions on subsequent Transfers and the provisions regarding voiding the
Transfer and mandatory sales. The Transferee expressly agrees to be bound by and
to abide by the provisions of Section 5.02(c) of the Agreement and the
restrictions noted on the face of the Certificate. The Transferee understands
and agrees that any breach of any of the representations included herein shall
render the Transfer to the Transferee contemplated hereby null and void.
12. The Transferee consents to any additional restrictions or arrangements that
shall be deemed necessary upon advice of counsel to constitute a reasonable
arrangement to ensure that the Certificate will only be owned, directly or
indirectly, by a Transferee that is not a disqualified organization.
13. The Transferee will not transfer its interest in the Certificate for the
purpose of impeding the assessment or collection of any tax.
14. The Transferee will not transfer such Certificate unless (i) it has received
from any subsequent transferee an affidavit in substantially the same form as
this affidavit containing the same representations set forth herein, and (ii) as
of the time of the transfer, it does not have actual knowledge that such
affidavit is false. The Transferee will deliver such affidavit to the Securities
Administrator upon receipt.
* * *
H-3
IN WITNESS WHEREOF, the Transferee has caused this instrument to be executed on
its behalf, pursuant to authority of its Board of Directors, by its duly
authorized officer and its corporate seal to be hereunto affixed, duly attested,
this __ day of ________, 20__.
_______________________________________
Print Name of Transferee
By:
-----------------------------------
Name:
Title:
[Corporate Seal]
ATTEST:
--------------------------------------
[Assistant] Secretary
Personally appeared before me the above-named __________, known or proved to me
to be the same person who executed the foregoing instrument and to be the
___________ of the Transferee, and acknowledged that he executed the same as his
free act and deed and the free act and deed of the Transferee.
Subscribed and sworn before me this __ day of ________, 20__.
---------------------------------------
NOTARY PUBLIC
My Commission expires the __ day
of _________, 20__
H-4
EXHIBIT I
FORM OF TRANSFEROR CERTIFICATE
__________, 20__
Xxxxxx Xxxxxxx ABS Capital I Inc.
0000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank, National Association
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Re: IXIS Real Estate Capital Trust, Series 2007-HE1, Mortgage
Pass-Through Certificates, Series 2007-HE1, Class ___
Ladies and Gentlemen:
In connection with our disposition of the above Certificates we certify that (a)
we understand that the Certificates have not been registered under the
Securities Act of 1933, as amended (the "Act"), and are being disposed by us in
a transaction that is exempt from the registration requirements of the Act, (b)
we have not offered or sold any Certificates to, or solicited offers to buy any
Certificates from, any person, or otherwise approached or negotiated with any
person with respect thereto, in a manner that would be deemed, or taken any
other action which would result in, a violation of Section 5 of the Act and (c)
to the extent we are disposing of a Residual Certificate, we have no knowledge
the Transferee is a Non-Permitted Transferee.
Very truly yours,
_______________________________________
Print Name of Transferor
By:
-----------------------------------
Authorized Officer
I-1
EXHIBIT J
FORM OF RULE 144A LETTER
____________, 20__
Xxxxxx Xxxxxxx ABS Capital I Inc.
0000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank, National Association
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Re: IXIS Real Estate Capital Trust, Series 2007-HE1, Mortgage
Pass-Through Certificates, Series 2007-HE1, Class____
Ladies and Gentlemen:
In connection with our acquisition of the above Certificates we certify that (a)
we understand that the Certificates are not being registered under the
Securities Act of 1933, as amended (the "Act"), or any state securities laws and
are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws, (b) we have such
knowledge and experience in financial and business matters that we are capable
of evaluating the merits and risks of investments in the Certificates, (c) we
have had the opportunity to ask questions of and receive answers from the
Depositor concerning the purchase of the Certificates and all matters relating
thereto or any additional information deemed necessary to our decision to
purchase the Certificates, (d) either (i) we are not an employee benefit plan or
arrangement that is subject to Title I of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), Section 4975 of the Internal Revenue
Code of 1986, as amended (the "Code"), or any federal, state or local law
materially similar to the foregoing provisions of ERISA or the Code (each, a
"Plan"), and we are not acting on behalf of any Plan or using the assets of any
Plan to effect our purchase of the Certificates or (ii) with respect to any
Certificates other than Class P, Class R and Class X Certificates, we are an
insurance company and are purchasing the Certificates with funds contained in an
"insurance company general account" (as defined term is defined in Section V(e)
of Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60")), and the
conditions for exemptive relief under Sections I and III of PTCE 95-60 are
satisfied with respect to our purchase and holding of the Certificates, (e) we
have not, nor has anyone acting on our behalf offered, transferred, pledged,
sold or otherwise disposed of the Certificates, any interest in the Certificates
or any other similar security to, or solicited any offer to buy or accept a
transfer,
J-1
pledge or other disposition of the Certificates, any interest in the
Certificates or any other similar security from, or otherwise approached or
negotiated with respect to the Certificates, any interest in the Certificates 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, that would constitute a distribution of the Certificates under
the Securities Act or that would render the disposition of the Certificates a
violation of Section 5 of the Securities Act or require registration pursuant
thereto, nor will act, nor has authorized or will authorize any person to act,
in such manner with respect to the Certificates, and (f) we are a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act and have completed either of the forms of certification to that effect
attached hereto as Annex 1 or Annex 2. We are aware that the sale to us is being
made in reliance on Rule 144A. We are acquiring the Certificates for our own
account or for resale pursuant to Rule 144A and further, understand that such
Certificates may be resold, pledged or transferred only (i) to a person
reasonably believed to be a qualified institutional buyer that purchases for its
own account or for the account of a qualified institutional buyer to whom notice
is given that the resale, pledge or transfer is being made in reliance on Rule
144A, or (ii) pursuant to another exemption from registration under the
Securities Act.
In connection with our purchase of the Certificates, we acknowledge
and agree that (i) none of you nor any of your affiliates is acting as a
fiduciary or financial or investment adviser for us; (ii) we are not relying
(for purposes of making any investment decision or otherwise) upon any advice,
counsel or representations (whether written or oral) of any of you or your
affiliates with respect to the Certificates; (iii) none of you nor any of your
affiliates has given to us (directly or indirectly through any other person) any
assurance, guarantee or representation whatsoever as to the expected or
projected success, profitability, return, performance, result, effect,
consequence, or benefit (including legal, regulatory, tax, financial, accounting
or otherwise) of our purchase of the Certificates; (iv) we have performed our
own diligence to the extent we have deemed necessary and we have consulted with
our own legal, regulatory, tax, business, investment, financial and accounting
advisers to the extent that we have deemed necessary, and we have made our own
investment decisions based upon our own judgment and upon any advice from such
advisers as we have deemed necessary and appropriate and not upon any view
expressed by any of you or your affiliates with respect to the Certificates; (v)
none of you nor any of your affiliates will be obligated to make payments on the
Certificates in the event that the assets of the trust is insufficient to
provide for such payments; (vi) you and your affiliates may have positions and
may effect transactions in any of the Series 2007-HE1 securities; and (vii) we
are familiar with the Certificates and have reviewed and understand the related
pooling and servicing agreement, the prospectus supplement and prospectus
relating to Series 2007-HE1 and the other material transaction documents related
thereto.
J-2
ANNEX 1 TO EXHIBIT J
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[FOR TRANSFEREES OTHER THAN REGISTERED INVESTMENT COMPANIES]
The undersigned (the "Buyer") hereby certifies as follows to the parties listed
in the Rule 144A Transferee Certificate to which this certification relates with
respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief Financial
Officer, Senior Vice President or other executive officer of the Buyer.
2. In connection with purchases by the Buyer, the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933, as amended ("Rule 144A") because (i) the Buyer owned and/or
invested on a discretionary basis $_________ in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A and (ii)
the Buyer satisfies the criteria in the category marked below.
_____ Corporation, etc. The Buyer is a corporation (other than a bank,
savings and loan association or similar institution),
Massachusetts or similar business trust, partnership, or
charitable organization described in Section 501(c)(3) of the
Internal Revenue Code of 1986, as amended.
_____ Bank. The Buyer (a) is a national bank or banking institution
organized under the laws of any State, territory or the District
of Columbia, the business of which is substantially confined to
banking and is supervised by the State or territorial banking
commission or similar official or is a foreign bank or
equivalent institution, and (b) has an audited net worth of at
least $25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
_____ Savings and Loan. The Buyer (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is
supervised and examined by a State or Federal authority having
supervision over any such institutions or is a foreign savings
and loan association or equivalent institution and (b) has an
audited net worth of at least $25,000,000 as demonstrated in its
latest annual financial statements, a copy of which is attached
hereto.
_____ Broker-dealer. The Buyer is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934.
J-3
_____ Insurance Company. The Buyer is an insurance company whose
primary and predominant business activity is the writing of
insurance or the reinsuring of risks underwritten by insurance
companies and which is subject to supervision by the insurance
commissioner or a similar official or agency of a State,
territory or the District of Columbia.
_____ State or Local Plan. The Buyer is a plan established and
maintained by a State, its political subdivisions, or any agency
or instrumentality of the State or its political subdivisions,
for the benefit of its employees.
_____ ERISA Plan. The Buyer is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income Security
Act of 1974.
_____ Investment Advisor. The Buyer is an investment advisor
registered under the Investment Advisors Act of 1940.
_____ Small Business Investment Company. Buyer is a small business
investment company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958.
_____ Business Development Company. Buyer is a business development
company as defined in Section 202(a)(22) of the Investment
Advisors Act of 1940.
3. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Buyer, (ii) securities that are part of an
unsold allotment to or subscription by the Buyer, if the Buyer is a dealer,
(iii) securities issued or guaranteed by the U.S. or any instrumentality
thereof, (iv) bank deposit notes and certificates of deposit, (v) loan
participations, (vi) repurchase agreements, (vii) securities owned but subject
to a repurchase agreement and (viii) currency, interest rate and commodity
swaps.
4. For purposes of determining the aggregate amount of securities owned and/or
invested on a discretionary basis by the Buyer, the Buyer used the cost of such
securities to the Buyer and did not include any of the securities referred to in
the preceding paragraph, except (i) where the Buyer reports its securities
holdings in its financial statements on the basis of their market value, and
(ii) no current information with respect to the cost of those securities has
been published. If clause (ii) in the preceding sentence applies, the securities
may be valued at market. Further, in determining such aggregate amount, the
Buyer may have included securities owned by subsidiaries of the Buyer, but only
if such subsidiaries are consolidated with the Buyer in its financial statements
prepared in accordance with generally accepted accounting principles and if the
investments of such subsidiaries are managed under the Buyer's direction.
However, such securities were not included if the Buyer is a majority-owned,
consolidated subsidiary of another enterprise and the Buyer is not itself a
reporting company under the Securities Exchange Act of 1934, as amended.
J-4
5. The Buyer acknowledges that it is familiar with Rule 144A and understands
that the seller to it and other parties related to the Certificates are relying
and will continue to rely on the statements made herein because one or more
sales to the Buyer may be in reliance on Rule 144A.
6. Until the date of purchase of the Rule 144A Securities, the Buyer will notify
each of the parties to which this certification is made of any changes in the
information and conclusions herein. Until such notice is given, the Buyer's
purchase of the Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if the Buyer is a
bank or savings and loan is provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after they
become available.
_______________________________________
Print Name of Transferee
By:
-----------------------------------
Name:
Title:
Date: _________________________________
J-5
ANNEX 2 TO EXHIBIT J
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[FOR TRANSFEREES THAT ARE REGISTERED INVESTMENT COMPANIES]
The undersigned (the "Buyer") hereby certifies as follows to the parties listed
in the Rule 144A Transferee Certificate to which this certification relates with
respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief Financial Officer
or Senior Vice President of the Buyer or, if the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933, as amended ("Rule 144A") because Buyer is part of a Family of
Investment Companies (as defined below), is such an officer of the Adviser.
2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, as
amended and (ii) as marked below, the Buyer alone, or the Buyer's Family of
Investment Companies, owned at least $100,000,000 in securities (other than the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year. For purposes of determining the amount of securities owned by the
Buyer or the Buyer's Family of Investment Companies, the cost of such securities
was used, except (i) where the Buyer or the Buyer's Family of Investment
Companies reports its securities holdings in its financial statements on the
basis of their market value, and (ii) no current information with respect to the
cost of those securities has been published. If clause (ii) in the preceding
sentence applies, the securities may be valued at market.
_____ The Buyer owned $______ in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most
recent fiscal year (such amount being calculated in accordance
with Rule 144A).
_____ The Buyer is part of a Family of Investment Companies which
owned in the aggregate $ ________ in securities (other than the
excluded securities referred to below) as of the end of the
Buyer's most recent fiscal year (such amount being calculated in
accordance with Rule 144A).
3. The term "Family of Investment Companies" as used herein means two or more
registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Buyer or are part of the Buyer's Family of
Investment Companies, (ii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iii) bank deposit notes and certificates of deposit,
(iv) loan participations, (v) repurchase agreements, (vi) securities
J-6
owned but subject to a repurchase agreement and (vii) currency, interest rate
and commodity swaps.
5. The Buyer is familiar with Rule 144A and understands that the parties listed
in the Rule 144A Transferee Certificate to which this certification relates are
relying and will continue to rely on the statements made herein because one or
more sales to the Buyer will be in reliance on Rule 144A. In addition, the Buyer
will only purchase for the Buyer's own account.
6. Until the date of purchase of the Certificates, the undersigned will notify
the parties listed in the Rule 144A Transferee Certificate to which this
certification relates of any changes in the information and conclusions herein.
Until such notice is given, the Buyer's purchase of the Certificates will
constitute a reaffirmation of this certification by the undersigned as of the
date of such purchase.
_______________________________________
Print Name of Transferee
By:
-----------------------------------
Name:
Title:
IF AN ADVISER:
---------------------------------------
Print Name of Buyer
Date: _________________________________
J-7
EXHIBIT K
FORM OF REQUEST FOR RELEASE
To: Xxxxx Fargo Bank, National Association
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Deutsche Bank National Trust Company
0000 Xxxx Xx. Xxxxxx Xxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000-0000
Re:
In connection with the administration of the Mortgage Loans held by Deutsche
Bank National Trust Company as the Custodian on behalf of the
Certificateholders, we request the release, and acknowledge receipt, of the
(Custodial File/[specify documents]) for the Mortgage Loan described below, for
the reason indicated.
Mortgagor's Name, Address & Zip Code:
Mortgage Loan Number:
Send Custodial File to:
Reason for Requesting Documents (check one)
_____ 1. Mortgage Loan Paid in Full. (The undersigned hereby certifies that
all amounts received in connection therewith have been credited to
the applicable Collection Account as provided in the Pooling and
Servicing Agreement.)
_____ 2. Mortgage Loan Repurchase Pursuant to Subsection 2.03 of the
Pooling and Servicing Agreement. (The undersigned hereby certifies
that the repurchase price has been credited to the applicable
Collection Account as provided in the Pooling and Servicing
Agreement.)
_____ 3. Mortgage Loan Liquidated By _________________. (The undersigned
hereby certifies that all proceeds of foreclosure, insurance,
condemnation or other liquidation have been finally received and
credited to the applicable Collection Account pursuant to the Pooling
and Servicing Agreement.)
_____ 4. Mortgage Loan in Foreclosure.
_____ 5. Other (explain).
K-1
If box 1, 2 or 3 above is checked, and if all or part of the Custodial File was
previously released to us, please release to us our previous request and receipt
on file with you, as well as any additional documents in your possession
relating to the specified Mortgage Loan.
If box 4 or 5 above is checked, upon our return of all of the above documents to
you as the Custodian, please acknowledge your receipt by signing in the space
indicated below, and returning this form if requested.
[SERVICER]
By:
------------------------------------
Name:
Title:
Date:
K-2
EXHIBIT L
FORM OF SUBSEQUENT TRANSFER AGREEMENT
IXIS REAL ESTATE CAPITAL TRUST 2007-HE1
Pursuant to separate Mortgage Loan Purchase Agreements, First NLC Financial
Services LLC ("First NLC"), Master Financial, Inc.("Master Financial"), Lenders
Direct Capital Corp. ("Lenders Direct"), Rose Mortgage, Inc. ("Rose Mortgage"),
Funding America, LLC ("Funding America"), NC Capital Corporation ("NC Capital"),
Maxim Mortgage Corp. ("Maxim"), Sebring Capital Partners, LP ("Sebring"),
Accredited Home Lenders, Inc. ("Accredited"), First Horizon Home Loan
Corporation ("First Horizon"), Platinum Capital Group ("Platinum"), Lime
Financial Services, Ltd. ("Lime"), Mandalay Mortgage LLC ("Mandalay"), FlexPoint
Funding Corporation ("FlexPoint"), Quick Loan Funding Inc. ("Quick Loan"), First
Bank Mortgage, Inc ("First Bank") and The CIT Group/Consumer Finance Inc ("CIT")
(collectively, the "Originators") have agreed to sell to IXIS Real Estate
Capital Inc. (the "Unaffiliated Seller") certain mortgage loans (each, a
"Mortgage Loan"). These Mortgage Loans may in turn be sold by the Unaffiliated
Seller to Xxxxxx Xxxxxxx ABS Capital I Inc. (the "Depositor") and then sold by
the Depositor to the IXIS Real Estate Capital Trust 0000-XX0 (xxx "Xxxxx Xxxx").
The Trust Fund was established pursuant to a Pooling and Servicing Agreement
dated as of January 1, 2007 (the "Pooling and Servicing Agreement") among Xxxxxx
Xxxxxxx ABS Capital I Inc., as depositor (the "Depositor"), Saxon Mortgage
Services, Inc., as the servicer ("Saxon" and the "Servicer"), IXIS Real Estate
Capital Inc., as unaffiliated seller (the "Unaffiliated Seller"), Deutsche Bank
National Trust Company, as trustee and custodian (in each such capacity,
respectively, the "Trustee" and the "Custodian") and Xxxxx Fargo Bank, National
Association, as securities administrator and master servicer (in each such
capacity, respectively, the "Securities Administrator" and the "Master
Servicer"). The Pooling and Servicing Agreement permits a Pre-Funding feature,
allowing for the acquisition by the Trust Fund of Subsequent Mortgage Loans
during the Pre-Funding Period. Representations and warranties with respect to
the Mortgage Loans have been made by the Originators pursuant to separate
Assignment and Recognition Agreements.
Capitalized terms used herein and not defined herein have their respective
meanings as set forth in the Pooling and Servicing Agreement.
Conveyance of Subsequent Mortgage Loans.
The Unaffiliated Seller does hereby irrevocably sell, transfer, assign, set over
and otherwise convey to the Depositor, without recourse (except as otherwise
explicitly provided for herein) all of its right, title and interest in and to
the Subsequent Mortgage Loans, exclusive of the obligations of the Unaffiliated
Seller or any other Person with respect to the Subsequent Mortgage Loans but
including specifically, without limitation, the Mortgages, the Custodial Files
and all other documents, materials and properties appurtenant thereto and the
Mortgage Notes, including all interest and principal collected by the
Unaffiliated Seller on or with respect to the Subsequent Mortgage Loans after
the related Subsequent Cut-off Date, together with all of its right, title and
interest in and to the proceeds received after such Subsequent Cut-off Date of
any related insurance policies on behalf of the Depositor.
L-1
The Depositor does hereby irrevocably sell, transfer, assign, set over and
otherwise convey to the Trust Fund, without recourse (except as otherwise
explicitly provided for herein) all of its right, title and interest in and to
the Subsequent Mortgage Loans, exclusive of the obligations of the Depositor or
any other Person with respect to the Subsequent Mortgage Loans but including
specifically, without limitation, the Mortgages, the Custodial Files and all
other documents, materials and properties appurtenant thereto and the Mortgage
Notes, including all interest and principal collected by the Depositor on or
with respect to the Subsequent Mortgage Loans after the related Subsequent
Cut-off Date, together with all of its right, title and interest in and to the
proceeds received after such Subsequent Cut-off Date of any related insurance
policies on behalf of the Trust Fund.
The expenses and costs relating to the delivery of the Subsequent Mortgage Loans
specified in this Subsequent Transfer Agreement and the Pooling and Servicing
Agreement shall be borne by the Unaffiliated Seller.
The Unaffiliated Seller hereby affirms the representation and warranty set forth
in Sections 3.01(f), 3.01(h), 3.01(n), 3.01(o), 3.01(p) and 3.03 of the
Unaffiliated Seller's Agreement with respect to the Subsequent Mortgage Loans as
of the date hereof. The Unaffiliated Seller hereby delivers notice and confirms
that each of the conditions set forth in Section 2.01(c) of the Pooling and
Servicing Agreement are satisfied as of the date hereof.
Saxon hereby affirms the representations and warranties set forth in Schedule
IIIA to the Pooling and Servicing Agreement with respect to the Subsequent
Mortgage Loans as of the date hereof.
Additional terms of the sale are attached hereto as Attachment A.
To the extent permitted by applicable law, this Subsequent Transfer Agreement,
or a memorandum thereof if permitted under applicable law, is subject to
recordation in all appropriate public offices for real property records in all
counties or other comparable jurisdictions in which any or all of the properties
subject to the Mortgages are situated, and in any other appropriate public
recording office or elsewhere, such recordation to be effected by the Servicer
at the Unaffiliated Seller's expense, but only when accompanied by an opinion of
counsel to the effect that such recordation materially and beneficially affects
the interests of the Certificateholders or is necessary for the administration
or servicing of the Mortgage Loans.
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, without giving effect to the
principles of conflicts of laws.
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.
All terms and conditions of the Pooling and Servicing Agreement are hereby
ratified, confirmed and incorporated herein; provided, that in the event of any
conflict the provisions of this Subsequent Transfer Agreement shall control over
the conflicting provisions of the Pooling and Servicing Agreement.
[Remainder of Page Intentionally Left Blank]
L-2
IXIS REAL ESTATE CAPITAL INC.,
as Unaffiliated Seller
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
XXXXXX XXXXXXX ABS CAPITAL I INC.,
as Depositor
By:
------------------------------------
Name:
Title:
SAXON MORTGAGE SERVICES, INC.,
as the Servicer
BY: [__________________________________]
By:
------------------------------------
Name:
Title:
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as Securities Administrator and
Master Servicer
By:
------------------------------------
Name:
Title:
DEUTSCHE BANK NATIONAL TRUST COMPANY,
as Trustee
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
L-3
EXHIBIT M
FORM OF CERTIFICATION TO BE
PROVIDED BY DEPOSITOR
Re: IXIS Real Estate Capital Trust 2007-HE1 Mortgage Pass-Through Certificates,
Series 2007-HE1, issued pursuant to the Pooling and Servicing Agreement
dated as of January 1, 2007 (the "Pooling and Servicing Agreement"), among
Xxxxxx Xxxxxxx ABS Capital I Inc., as depositor (the "Depositor"), Saxon
Mortgage Services, Inc., as the servicer ("Saxon" and the "Servicer"), IXIS
Real Estate Capital Inc., as unaffiliated seller (the "Unaffiliated
Seller"), Deutsche Bank National Trust Company, as trustee and custodian
(in each such capacity, respectively, the "Trustee" and the "Custodian")
and Xxxxx Fargo Bank, National Association, as securities administrator and
master servicer (in each such capacity, respectively, the "Securities
Administrator" and the "Master Servicer").
I, [identify the certifying individual], certify that:
1. I have reviewed this annual report on Form 10-K ("Annual Report"), and
all reports on Form 10-D containing distribution or servicing reports
(collectively with this Annual Report, the "Reports") required to be
filed in the periods covered by this Annual Report of the Depositor
relating to the above-referenced trust and series of certificates;
2. Based on my knowledge, the Reports, 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 light of the
circumstances under which such statements were made, not misleading
with respect to the period covered by this Annual Report;
3. Based on my knowledge, all of the distribution, servicing and other
information required to be provided on Form 10-D for the period
covered by this Annual Report is included in the Reports;
4. Based on my knowledge and the compliance statements required in this
Annual Report under Item 1123 of Regulation AB, and except as
disclosed in the Reports, the Servicer and the Master Servicer has
fulfilled its obligations under the Pooling and Servicing Agreement;
and
5. All of the reports on assessment of compliance with servicing criteria
for asset-backed securities and their related attestation reports on
assessment of compliance with servicing criteria required to be
included in this Annual Report in accordance with Item 1122 of
Regulation AB and Exchange Act Rules 13a-18 and 15d-18 have been
included as an exhibit to this Annual Report, except as otherwise
disclosed in this Annual Report. Any material instances of
non-compliance described in such reports have been disclosed in this
Annual Report.
M-1
In giving the certifications above, I have reasonably relied on information
provided to me by the following unaffiliated parties: the Securities
Administrator, the Master Servicer and the Servicer.
Date: __________
-------------------------------
[Signature]
[Title]
M-2
EXHIBIT N-1
SERVICER CERTIFICATIONS TO BE PROVIDED TO THE MASTER SERVICER AND DEPOSITOR
Re: IXIS Real Estate Capital Trust 2007-HE1 Mortgage Pass-Through Certificates,
Series 2007-HE1, issued pursuant to the Pooling and Servicing Agreement, dated
as of January 1, 2007 (the "Pooling and Servicing Agreement"), among Xxxxxx
Xxxxxxx ABS Capital I Inc., as depositor (the "Depositor")", IXIS Real Estate
Capital Inc., as unaffiliated seller (the "Unaffiliated Seller"), Deutsche Bank
National Trust Company, as trustee and custodian (in each such capacity,
respectively, the "Trustee" and the "Custodian"), Xxxxx Fargo Bank, National
Association, as securities administrator and master servicer (in each such
capacity, respectively, the "Securities Administrator" and the "Master
Servicer"), Saxon Mortgage Services, Inc., as a servicer ("Saxon").
[NAME OF SERVICER] (the "Servicer"), certifies to the Depositor, the Master
Servicer and the Securities Administrator, as applicable, and its officers,
directors and affiliates, and with the knowledge and intent that they will rely
upon this certification, that:
1. The Servicer has reviewed the servicer compliance statement of the
Servicer and the compliance statements of each Subservicer, if any,
engaged by Servicer provided to the Depositor and the Securities
Administrator for the Trust's fiscal year [___] in accordance with
Item 1123 of Regulation AB (each a "Compliance Statement"), the report
on assessment of the Servicer's compliance with the applicable
servicing criteria set forth in Item 1122(d) of Regulation AB (the
"Servicing Criteria") and reports on assessment of compliance with
servicing criteria for asset-backed securities of the Servicer and of
each Subservicer or Subcontractor, if any, engaged or utilized by the
Servicer provided to the Depositor and the Securities Administrator
for the Trust's fiscal year [___] 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 (each a "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 related to each
Servicing Assessment (each an "Attestation Report"), and all servicing
reports, officer's certificates and other information relating to the
servicing of the Mortgage Loans by the Servicer, if any, during
[_____] that were delivered or caused to be delivered by the Servicer
pursuant to the Agreement (collectively, the "Servicing Information");
2. Based on the Servicer's knowledge, the 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
Servicing Information;
N-1-1
3. Based on the Servicer's knowledge, the Servicing Information required
to be provided to the Securities Administrator by the Servicer
pursuant to the Pooling and Servicing Agreement has been provided to
the Securities Administrator;
4. Based on the Servicer's knowledge and the compliance review conducted
in preparing Compliance Statement of the Servicer and, if applicable,
reviewing each Compliance Statement of each Subservicer, if any,
engaged by the Servicer, and except as disclosed in such Compliance
Statement[(s)], the Servicer [(directly and through its Subservicers,
if any)] has fulfilled its obligations under the Pooling and Servicing
Agreement in all material respects; and
5. Each Servicing Assessment of the Servicer and of each Subservicer or
Subcontractor, if any, engaged or utilized by the Servicer and its
related Attestation Report required to be included in the Annual
Report in accordance with Item 1122 of Regulation AB and Exchange Act
Rules 13a-18 and 15d-18 has been provided to the Depositor, the Master
Servicer and the Securities Administrator. Any material instances of
non-compliance are described in any such Servicing Assessment or
Attestation Report.
Date: __________
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
N-1-2
EXHIBIT N-2
MASTER SERVICER CERTIFICATIONS TO BE PROVIDED TO DEPOSITOR
Re: IXIS Real Estate Capital Trust 2007-HE1 Mortgage Pass-Through Certificates,
Series 2007-HE1, issued pursuant to the Pooling and Servicing Agreement, dated
as of January 1, 2007 (the "Pooling and Servicing Agreement"), among Xxxxxx
Xxxxxxx ABS Capital I Inc., as depositor (the "Depositor)", IXIS Real Estate
Capital Inc., as unaffiliated seller (the "Unaffiliated Seller"), Deutsche Bank
National Trust Company, as trustee and custodian (in each such capacity,
respectively, the "Trustee" and the "Custodian"), Xxxxx Fargo Bank, National
Association, as securities administrator and master servicer (in each such
capacity, respectively, the "Securities Administrator" and the "Master
Servicer"), Saxon Mortgage Services, Inc., as the servicer ("Saxon" and the
"Servicer").
[NAME OF MASTER SERVICER] (the "Master Servicer"), certifies to the Depositor
and the Securities Administrator, as applicable, and its officers, directors and
affiliates, and with the knowledge and intent that they will rely upon this
certification, that:
1. The Master Servicer has reviewed the servicer compliance statement of
the Master Servicer provided to the Depositor and the Securities
Administrator for the Trust's fiscal year [___] in accordance with
Item 1123 of Regulation AB (each a "Compliance Statement"), the report
on assessment of the Master Servicer's compliance with the applicable
servicing criteria set forth in Item 1122(d) of Regulation AB (the
"Servicing Assessment") and all servicing reports, officer's
certificates and other information relating to the servicing of the
Mortgage Loans by the Master Servicer, if any, during 200[_] that were
delivered or caused to be delivered by the Master Servicer pursuant to
the Agreement (collectively, the "Servicing Information");
2. Based on the Master Servicer's knowledge, the 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 Servicing Information;
3. Based on the Master Servicer's knowledge, the Servicing Information
required to be provided to the Securities Administrator by the Master
Servicer pursuant to the Pooling and Servicing Agreement has been
provided to the Securities Administrator;
4. Based on the Master Servicer's knowledge and the compliance review
conducted in preparing Compliance Statement of the Master Servicer,
and except as disclosed in such Compliance Statement or Servicing
Assessment, the Master Servicer has fulfilled its obligations under
the Pooling and Servicing Agreement in all material respects; and
N-2-1
5. Each required Servicing Assessment and Compliance Statement has been
provided to the Depositor and the Securities Administrator. Any
material instances of non-compliance are described in such reports.
In making this certification, the Master Servicer is relying upon the
information provided by the Servicer.
Date: __________
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
N-2-2
EXHIBIT O
SECURITIES ADMINISTRATOR CERTIFICATIONS TO BE PROVIDED TO DEPOSITOR
Re: IXIS Real Estate Capital Trust 2007-HE1 Mortgage Pass-Through Certificates,
Series 2007-HE1, issued pursuant to the Pooling and Servicing Agreement, dated
as of January 1, 2007 (the "Pooling and Servicing Agreement"), among Xxxxxx
Xxxxxxx ABS Capital I Inc., as depositor (the "Depositor)", IXIS Real Estate
Capital Inc., as unaffiliated seller (the "Unaffiliated Seller"), Saxon Mortgage
Services, Inc., as the servicer ("Saxon" and the "Servicer"), Deutsche Bank
National Trust Company, as custodian and trustee (respectively, the "Custodian"
and "Trustee"), and Xxxxx Fargo Bank, National Association, as securities
administrator and master servicer (in each such capacity, respectively, the
"Securities Administrator" and the "Master Servicer").
Xxxxx Fargo Bank, National Association, not in its individual capacity but
solely as securities administrator, certifies to the Depositor, and its
officers, directors and affiliates, and with the knowledge and intent that they
will rely upon this certification, that:
1. It has reviewed the annual report on Form 10-K for the fiscal year
20__ (the "Annual Report"), and all reports on Form 10-D required to
be filed in respect of period covered by the Annual Report
(collectively with this Annual Report, the "Reports"), of the
Depositor relating to the above-referenced trust;
2. Based on its knowledge, the distribution information in the
distribution reports contained in all Form 10-D prepared by the
Securities Administrator, 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 light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by the Annual Report;
3. Based on its knowledge, the distribution information required to be
provided to the Securities Administrator by the Master Servicer or the
Servicer, as the case may be, under the Pooling and Servicing
Agreement for inclusion in the Reports is included in the Reports; and
5. The report on assessment of compliance with servicing criteria for
asset-backed securities of the Securities Administrator and its
related attestation report on assessment of compliance with servicing
criteria applicable to it required to be included in the Annual Report
in accordance with Item 1122 of Regulation AB and Exchange Act Rules
13a-18 and 15d-18 has been included as an exhibit to the Annual
Report. Any material instances of non-compliance are described in such
report and have been disclosed in the Annual Report.
In compiling the distribution information and making the foregoing
certifications, the Securities Administrator has relied upon information
furnished to it by the Master Servicer or the Servicer, as the case may be,
under the Pooling and Servicing Agreement. The Securities Administrator shall
have no responsibility or liability for any inaccuracy in such reports resulting
from information so provided by the Master Servicer or the Servicer, as the case
may be.
O-1
XXXXX FARGO BANK, NATIONAL
ASSOCIATION, not in its individual
capacity, but solely as Securities
Administrator
By:
---------------------------------
Name:
Title:
O-2
EXHIBIT P
[Company Letter head]
CALCULATION OF REALIZED LOSS/GAIN
Prepared By: Date:
Phone:
Servicer Loan # Servicer Name:
Pool: Borrower Name:
Investor loan # Property Address:
TYPE OF LIQUIDATION: REO SHORT SALE
THIRD PARTY CHARGEOFF
CREDITS:
Proceeds from Sale of Acquired Property $0.00
Escrow Balance
HIP Refund
Rental Receipts
Hazard Loss Proceeds
Primary Mortgage Insurance Proceeds
Other (itemize):
TOTAL CREDITS: $0.00
LESS EXPENSES:
Attorney's Fees
Bankruptcy Fees
Court Costs (Recording, Filing Fees, Etc.)
Advertising/Sheriff's fees
Title Policy/Report
Real Estate Taxes
Hazard Insurance Premiums
MI Insurance Premiums
Inspections
P-1
Property Preservation (Securing, Winterization, Lawn Care, Etc.)
Appraisal/BPO Fees
Repairs
Hazard Loss Expenses
Other (itemize)
SUBTOTAL EXPENSES: $0.00
LESS INTEREST ADVANCED:
Interest Advanced to date at Net Rate $0.00
Last Month's Advanced Net Interest $0.00
Accrued Servicing Fees $0.00
Last month Servicing Fees $0.00
SUBTOTAL EXPENSES: $0.00
TOTAL EXPENSES: $0.00
GROSS LIQUIDATION PROCEEDS $0.00
SCHEDULED PRINCIPAL BALANCE OF MORTGAGE LOAN $0.00
PRINCIPAL ADVANCES PASSED THROUGH TO INVESTOR $0.00
TOTAL REALIZED (LOSS) OR AMOUNT OF GAIN: $0.00
ACTUAL UNPAID PRINCIPAL BALANCE OF MORTGAGE LOAN 0.00
LAST MONTH'S ADVANCED NET INTEREST 0.00
LESS PRINCIPAL ADVANCES 0.00
REALIZED GAIN/LOSS 0.00
REMITTANCE DUE TO INVESTOR 0.00
AMOUNT ALREADY REMITTED (OR GAIN NOT DUE TO INVESTOR) 0.00
ADJUSTED AMOUNT DUE FROM SERVICER 0.00
This letter certifies that in accordance with the provisions of the respective
Pooling and Servicing Agreement, the attached "Realized Loss Calculation" is
loan level detail of this realized loss for the above referenced deal.
Authorized Signature Printed Name and Title
P-2
EXHIBIT Q
SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The assessment of compliance to be delivered by Securities Administrator, the
Master Servicer, [the Servicer], [each Subservicer] and [each Subcontractor]
shall address, at a minimum, the criteria identified as below as "Applicable
Servicing Criteria":
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
------------------------------------------------------------------------------------------------
Reference Criteria
General Servicing Considerations
1122(d)(1)(i) Policies and procedures are instituted to monitor Master Servicer
any performance or other triggers and events of
default in accordance with the transaction
agreements.
1122(d)(1)(ii) If any material servicing activities are Master
outsourced to third parties, policies and Servicer/Servicer
procedures are instituted to monitor the third
party's performance and compliance with such
servicing activities.
1122(d)(1)(iii) Any requirements in the transaction agreements to N/A
maintain a back-up servicer for the mortgage
loans are maintained.
1122(d)(1)(iv) A fidelity bond and errors and omissions policy Servicer
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.
Cash Collection and Administration
1122(d)(2)(i) Payments on mortgage loans are deposited into the Servicer
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.
1122(d)(2)(ii) Disbursements made via wire transfer on behalf of Securities Administrator/
an obligor or to an investor are made only by Servicer
authorized personnel.
1122(d)(2)(iii) Advances of funds or guarantees regarding Servicer
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.
1122(d)(2)(iv) The related accounts for the transaction, such as Servicer/Master
cash reserve accounts or accounts established as Servicer/Securities
a form of overcollateralization, are separately Administrator
maintained (e.g.,
Q-1
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
------------------------------------------------------------------------------------------------
Reference Criteria
with respect to commingling of cash) as set forth
in the transaction agreements.
1122(d)(2)(v) Each custodial account is maintained at a Servicer/Master
federally insured depository institution as set Servicer/Securities
forth in the transaction agreements. For purposes Administrator(2)
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.
1122(d)(2)(vi) Unissued checks are safeguarded so as to prevent N/A
unauthorized access.
1122(d)(2)(vii) Reconciliations are prepared on a monthly basis Servicer/Master Servicer
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.
Investor Remittances and Reporting
1122(d)(3)(i) Reports to investors, including those to be filed Master Servicer/
with the Commission, are maintained in accordance Securities Administrator/
with the transaction agreements and applicable Servicer
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
--------
(2) This will only be provided by the Master Servicer and
Securities Administrator if it is deemed that such account
maintained by the Master Servicer or Securities Administrator,
as applicable, is a custodial account for purposes of these
servicing criteria and is further subject to clarification from
the SEC.
Q-2
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
------------------------------------------------------------------------------------------------
Reference Criteria
and number of mortgage loans serviced by the
Servicer.
1122(d)(3)(ii) Amounts due to investors are allocated and Securities Administrator/
remitted in accordance with timeframes, Master Servicer/
distribution priority and other terms set forth Servicer
in the transaction agreements.
1122(d)(3)(iii) Disbursements made to an investor are posted Securities Administrator/
within two business days to the Servicer's Servicer
investor records, or such other number of days
specified in the transaction agreements.
1122(d)(3)(iv) Amounts remitted to investors per the investor Securities Administrator/
reports agree with cancelled checks, or other Master Servicer/
form of payment, or custodial bank statements. Servicer
Pool Asset Administration
1122(d)(4)(i) Collateral or security on mortgage loans is Custodian/Servicer
maintained as required by the transaction
agreements or related mortgage loan documents.
1122(d)(4)(ii) Mortgage loan and related documents are Custodian
safeguarded as required by the transaction
agreements
1122(d)(4)(iii) Any additions, removals or substitutions to the Servicer/Securities
asset pool are made, reviewed and approved in Administrator
accordance with any conditions or requirements in
the transaction agreements.
1122(d)(4)(iv) Payments on mortgage loans, including any Servicer
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.
1122(d)(4)(v) The Servicer's records regarding the mortgage Servicer
loans agree with the Servicer's records with
respect to an obligor's unpaid principal balance.
Q-3
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
------------------------------------------------------------------------------------------------
Reference Criteria
1122(d)(4)(vi) Changes with respect to the terms or status of an Servicer
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.
1122(d)(4)(vii) Loss mitigation or recovery actions (e.g., Servicer
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.
1122(d)(4)(viii) Records documenting collection efforts are Servicer
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).
1122(d)(4)(ix) Adjustments to interest rates or rates of return Servicer
for mortgage loans with variable rates are
computed based on the related mortgage loan
documents.
1122(d)(4)(x) Regarding any funds held in trust for an obligor Servicer
(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.
1122(d)(4)(xi) Payments made on behalf of an obligor (such as Servicer
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
Q-4
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
------------------------------------------------------------------------------------------------
Reference Criteria
other number of days specified in the transaction
agreements.
1122(d)(4)(xii) Any late payment penalties in connection with any Servicer
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.
1122(d)(4)(xiii) Disbursements made on behalf of an obligor are Servicer
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.
1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible Servicer
accounts are recognized and recorded in
accordance with the transaction agreements.
1122(d)(4)(xv) Any external enhancement or other support, Servicer
identified in Item 1114(a)(1) through (3) or Item
1115 of Regulation AB, is maintained as set forth
in the transaction agreements.
Q-5
EXHIBIT R
ADDITIONAL FORM 10-D DISCLOSURE
Item on Form 10-D Party Responsible
--------------------------------------- --------------------------------------
Item 1: Distribution and Pool Servicer
Performance Information Securities Administrator
Any information required by Item 1121 Servicer
of Regulation AB which is NOT included
on the Monthly Statement
Item 2: Legal Proceedings (i) All parties to the Agreement (as
to themselves to the extent
applicable), (ii) the Depositor as to
per Item 1117 of Regulation AB the sponsor, and each Originator
(other than a Responsible Party) or
any Regulation AB Item 1100(d)(1)
party
Item 3: Sale of Securities and Use of Depositor
Proceeds
Item 4: Defaults Upon Senior Securities Securities Administrator
Item 5: Submission of Matters to a Vote Depositor or the party to this
of Security Holders Agreement submitting such matter to a
vote of Certificateholders
Item 6: Significant Obligors of Pool N/A
Assets
Item 7: Significant Enhancement Depositor
Provider Information
Item 8: Other Information Any party to the Agreement responsible
for disclosure items on Form 8-K to
the extent applicable
Item 9: Exhibits
To the extent no notice is provided to the Securities Administrator as described
under the Pooling and Servicing Agreement of the events or information set forth
above in this Exhibit R, the Securities Administrator shall, without such
further notice, conclude that there is no event or information to be reported.
R-1
EXHIBIT S
ADDITIONAL FORM 10-K DISCLOSURE
Item on Form 10-K Party Responsible
--------------------------------------- --------------------------------------
Item 9B: Other Information Any party to the Agreement responsible
for disclosure items on Form 8-K to
the extent applicable
Item 15: Exhibits, Financial Statement Depositor
Schedules
Additional Item: (i) All parties to the Agreement (as
to themselves to the extent
Disclosure per Item 1117 of applicable), (ii) the Depositor as to
Regulation AB the sponsor and each Originator (other
than a Responsible Party) or any
1100(d)(1) party
Additional Item: (i) All parties to the Agreement as to
Disclosure per Item 1119 of themselves to the extent applicable,
Regulation AB (ii) the Depositor as to the sponsor,
or any derivative provider
Additional Item: N/A
Disclosure per Item 1112(b) of
Regulation AB
Additional Item: Depositor
Disclosure per Items 1114(b) and
1115(b) of Regulation AB
To the extent no notice is provided to the Securities Administrator as described
under the Pooling and Servicing Agreement of the events or information set forth
above in this Exhibit S, the Securities Administrator shall, without such
further notice, conclude that there is no event or information to be reported.
S-1
EXHIBIT T
FORM 8-K DISCLOSURE INFORMATION
Item on Form 8-K Party Responsible
--------------------------------------- --------------------------------------
Item 1.01- Entry into a Material The party to this Agreement entering
Definitive Agreement into such material definitive
agreement
Item 1.02- Termination of a Material The party to this Agreement requesting
Definitive Agreement termination of a material definitive
agreement
Item 1.03- Bankruptcy or Receivership (i) All parties to the Agreement (as
to themselves to the extent
applicable), (ii) the Servicer as to
the Trust, (iii) the Depositor as to
the sponsor and each Originator (other
than a Responsible Party) or any
1100(d)(1) party
Item 2.04- Triggering Events that Master Servicer/Securities
Accelerate or Increase a Direct Administrator/Depositor
Financial Obligation or an Obligation
under an Off-Balance Sheet Arrangement
Item 3.03- Material Modification to Securities Administrator/Depositor
Rights of Security Holders
Item 5.03- Amendments of Articles of Depositor
Incorporation or Bylaws; Change of
Fiscal Year
Item 6.01- ABS Informational and Depositor
Computational Material
Item 6.02- Change of Servicer or Servicer
Trustee
Item 6.03- Change in Credit Enhancement Depositor
or External Support
Item 6.04- Failure to Make a Required Securities Administrator
Distribution
Item 6.05- Securities Act Updating Depositor
Disclosure
Item 7.01- Regulation FD Disclosure Depositor
Item 8.01 Depositor
To the extent no notice is provided to the Securities Administrator as described
under the Pooling and Servicing Agreement of the events or information set forth
above in this Exhibit T, the Securities Administrator shall, without such
further notice, conclude that there is no event or information to be reported.
T-1
EXHIBIT U
Interest Rate Swap Agreement
U-1
EXHIBIT V
Interest Rate Cap Agreement
V-1
EXHIBIT W
FORM OF ADVANCE REIMBURSEMENT NOTICE
[__________], 200[_]
Xxxxx Fargo Bank, National Association
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Re: Loan and Security Agreement, dated as of [__________], 200[_] (the
"Loan and Security Agreement"), by and between [__________] and
[__________] ("Advancing Person").
Ladies and Gentlemen:
[__________] ("[__________]") currently acts as the servicer (a "Servicer") for
a pool of Mortgage Loans (a "Trust") owned by Deutsche Bank National Trust
Company as trustee on behalf of IXIS Real Estate Capital Trust 2007-HE1 (the
"Owner"). The servicing arrangements regarding [__________]'s duties as the
Servicer of such Trust on behalf of the Owner are governed by a pooling and
servicing agreement dated as of January 1, 2007, among Xxxxxx Xxxxxxx ABS
Capital I Inc. as depositor, Xxxxx Fargo Bank, National Association as master
servicer and securities administrator (in its capacity as securities
administrator, the "Securities Administrator"), Saxon Mortgage Services, Inc. as
servicer, IXIS Real Estate Capital, Inc. as unaffiliated seller and Deutsche
Bank National Trust Company as trustee and custodian (the "Pooling and Servicing
Agreement").
Pursuant to the Loan and Security Agreement referenced above, the Advancing
Person has agreed to finance the principal and interest advances and the
servicing advances (collectively, the "Advances") [__________] is required to
make with respect to the Mortgage Loans under the terms of the Pooling and
Servicing Agreement. In exchange therefore, [__________] has pledged its right
of reimbursement for such Advances to the Advancing Person.
In furtherance of the foregoing, [__________] and the Advancing Person agree,
and the Owner and the Securities Administrator acknowledge (and, with respect to
paragraph (5) below, agree) as follows:
(1) Notwithstanding the Advancing Person's financing of the Advances
related to the Trust, the parties hereto are not releasing
[__________] from any of its obligations under the Pooling and
Servicing Agreement and neither the Owner nor the Securities
Administrator has any right or ability to require the Advancing Person
to make any advances.
(2) The parties acknowledge that the reimbursement obligations pledged to
the Advancing Person for Advances financed by it are obligations owed
only to [__________] on a non-recourse basis payable only from the
cash flows and proceeds (liquidation or otherwise) of the related
Mortgage Loans pursuant to the terms of the Pooling and Servicing
Agreement. Neither the Owner nor the
W-1
Securities Administrator is obligated or liable to repay any Advances
made by [__________] or financed by the Advancing Person.
(3) The parties acknowledge that neither the Owner nor the Securities
Administrator shall have any rights or remedies against the Advancing
Person for any failure by the Servicer to service the Mortgage Loans
in accordance with the terms of the Pooling and Servicing Agreement;
provided, that such acknowledgement does not excuse the Advancing
Person from performing its obligations as a seller under the Pooling
and Servicing Agreement.
(4) [__________] will be responsible for remitting the applicable amounts
collected by it on a Mortgage Loan to the Advancing Person as
reimbursement for any Advances funded by the Advancing Person related
to such Mortgage Loan, subject to the restrictions and priorities
created by the Pooling and Servicing Agreement. Neither the Owner nor
the Securities Administrator shall have any responsibility to track or
monitor the administration of this financing vehicle between
[__________] and the Advancing Person.
(5) If [__________] resigns or is otherwise removed as the Servicer of the
Trust, the Owner or the Securities Administrator, as applicable, will
cooperate in good faith with the Advancing Person and [__________] to
assist in the reimbursement of any amounts then outstanding to the
Advancing Person for Advances previously financed by the Advancing
Person with respect to the Mortgage Loans in such Trust.
(6) The Advancing Person is an intended third party beneficiary of this
letter agreement.
[SIGNATURE PAGES FOLLOW ON NEXT PAGE]
W-2
[__________].
By:
----------------------------------
Name:
Title:
Acknowledged and Agreed:
XXXXX FARGO BANK, NATIONAL
ASSOCIATION,
not in its individual capacity but
solely as securities administrator
for the benefit of the holders of
the certificates issued by IXIS Real
Estate Capital Trust 2007-HE1
By:
-----------------------------------
Name:
Title:
W-3
EXHIBIT X
FORM OF MASTER SERVICER'S REPORT
STANDARD FILE LAYOUT - MASTER SERVICING
MAX
COLUMN NAME DESCRIPTION DECIMAL FORMAT COMMENT SIZE
---------------------- -------------------------------------- ------- ------------------------ ----
SER_INVESTOR_NBR A value assigned by the Servicer to Text up to 10 digits 20
define a group of loans.
LOAN_NBR A unique identifier assigned to each Text up to 10 digits 10
loan by the investor.
SERVICER_LOAN_NBR A unique number assigned to a loan by Text up to 10 digits 10
the Servicer. This may be different
than the LOAN_NBR.
BORROWER_NAME The borrower name as received in the Maximum length of 30 30
file. It is not separated by first (Last, First)
and last name.
SCHED_PAY_AMT Scheduled monthly principal and 2 No commas(,) or dollar 11
scheduled interest payment that a signs ($)
borrower is expected to pay, P&I
constant.
NOTE_INT_RATE The loan interest rate as reported by 4 Max length of 6 6
the Servicer.
NET_INT_RATE The loan gross interest rate less the 4 Max length of 6 6
service fee rate as reported by the
Servicer.
SERV_FEE_RATE The servicer's fee rate for a loan as 4 Max length of 6 6
reported by the Servicer.
SERV_FEE_AMT The servicer's fee amount for a loan 2 No commas(,) or dollar 11
as reported by the Servicer. signs ($)
NEW_PAY_AMT The new loan payment amount as 2 No commas(,) or dollar 11
reported by the Servicer. signs ($)
NEW_LOAN_RATE The new loan rate as reported by the 4 Max length of 6 6
Servicer.
ARM_INDEX_RATE The index the Servicer is using to 4 Max length of 6 6
calculate a forecasted rate.
ACTL_BEG_PRIN_BAL The borrower's actual principal 2 No commas(,) or dollar 11
balance at the beginning of the signs ($)
processing cycle.
ACTL_END_PRIN_BAL The borrower's actual principal 2 No commas(,) or dollar 11
balance at the end of the processing signs ($)
cycle.
BORR_NEXT_PAY_DUE_DATE The date at the end of processing MM/DD/YYYY 10
cycle that the borrower's next payment
is due to the Servicer, as reported by
Servicer.
SERV_CURT_AMT_1 The first curtailment amount to be 2 No commas(,) or dollar 11
applied. signs ($)
SERV_CURT_DATE_1 The curtailment date associated with MM/DD/YYYY 10
the first curtailment amount.
CURT_ADJ_ AMT_1 The curtailment interest on the first 2 No commas(,) or dollar 11
curtailment amount, if applicable. signs ($)
SERV_CURT_AMT_2 The second curtailment amount to be 2 No commas(,) or dollar 11
applied. signs ($)
SERV_CURT_DATE_2 The curtailment date associated with MM/DD/YYYY 10
the second curtailment amount.
CURT_ADJ_ AMT_2 The curtailment interest on the second 2 No commas(,) or dollar 11
curtailment amount, if applicable. signs ($)
SERV_CURT_AMT_3 The third curtailment amount to be 2 No commas(,) or dollar 11
applied. signs ($)
SERV_CURT_DATE_3 The curtailment date associated with MM/DD/YYYY 10
the third curtailment amount.
CURT_ADJ_AMT_3 The curtailment interest on the third 2 No commas(,) or dollar 11
curtailment amount, if applicable. signs ($)
PIF_AMT The loan "paid in full" amount as 2 No commas(,) or dollar 11
reported by the Servicer. signs ($)
PIF_DATE The paid in full date as reported by MM/DD/YYYY 10
the Servicer.
Y-1
MAX
COLUMN NAME DESCRIPTION DECIMAL FORMAT COMMENT SIZE
---------------------- -------------------------------------- ------- ------------------------ ----
ACTION_CODE The standard FNMA numeric code used to Action Code Key: 2
indicate the default/delinquent status 15=Bankruptcy,
of a particular loan. 30=Foreclosure,
60=PIF, 63=Substitution,
65=Repurchase,70=REO
INT_ADJ_AMT The amount of the interest adjustment 2 No commas(,) or dollar 11
as reported by the Servicer. signs ($)
SOLDIER_SAILOR_ADJ_AMT The Soldier and Sailor Adjustment 2 No commas(,) or dollar 11
amount, if applicable. signs ($)
NON_ADV_LOAN_AMT The Non Recoverable Loan Amount, if 2 No commas(,) or dollar 11
applicable. signs ($)
LOAN_LOSS_AMT The amount the Servicer is passing as 2 No commas(,) or dollar 11
a loss, if applicable. signs ($)
SCHED_BEG_PRIN_BAL The scheduled outstanding principal 2 No commas(,) or dollar 11
amount due at the beginning of the signs ($)
cycle date to be passed through to
investors.
SCHED_END_PRIN_BAL The scheduled principal balance due to 2 No commas(,) or dollar 11
investors at the end of a processing signs ($)
cycle.
SCHED_PRIN_AMT The scheduled principal amount as 2 No commas(,) or dollar 11
reported by the Servicer for the signs ($)
current cycle -- only applicable for
Scheduled/Scheduled Loans.
SCHED_NET_INT The scheduled gross interest amount 2 No commas(,) or dollar 11
less the service fee amount for the signs ($)
current cycle as reported by the
Servicer -- only applicable for
Scheduled/Scheduled Loans.
ACTL_PRIN_AMT The actual principal amount collected 2 No commas(,) or dollar 11
by the Servicer for the current signs ($)
reporting cycle -- only applicable for
Actual/Actual Loans.
ACTL_NET_INT The actual gross interest amount less 2 No commas(,) or dollar 11
the service fee amount for the current signs ($)
reporting cycle as reported by the
Servicer -- only applicable for
Actual/Actual Loans.
PREPAY_PENALTY_ AMT The penalty amount received when a 2 No commas(,) or dollar 11
borrower prepays on his loan as signs ($)
reported by the Servicer.
PREPAY_PENALTY_ WAIVED The prepayment penalty amount for the 2 No commas(,) or dollar 11
loan waived by the servicer. signs ($)
MOD_DATE The Effective Payment Date of the MM/DD/YYYY 10
Modification for the loan.
MOD_TYPE The Modification Type. Varchar - value can be 30
alpha or numeric
DELINQ_P&I_ADVANCE_AMT The current outstanding principal and 2 No commas(,) or dollar 11
interest advances made by Servicer. signs ($)
Y-2
EXHIBIT Y
ACCREDITED AGREEMENTS
Y-1
EXECUTION COPY
ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated January 30, 2007
("Agreement"), among IXIS Real Estate Capital Inc. ("Assignor"), Xxxxxx Xxxxxxx
ABS Capital I Inc. ("Assignee") and Accredited Home Lenders, Inc. (the
"Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns
to the Assignee all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain Third Amended
and Restated Mortgage Loan Purchase and Warranties Agreement (the "Purchase
Agreement"), dated as of August 1, 2006, between the Assignor, as purchaser (the
"Purchaser"), and the Company, as seller, solely insofar as the Purchase
Agreement relates to the Mortgage Loans and (c) other than as provided below
with respect to the enforcement of representations and warranties, none of the
obligations of the Assignor under the Purchase Agreement.
The Assignor specifically reserves and does not assign to the Assignee
hereunder (i) any and all right, title and interest in, to and under and any
obligations of the Assignor with respect to any mortgage loans subject to the
Purchase Agreement which are not the Mortgage Loans set forth on the Mortgage
Loan Schedule and are not the subject of this Agreement or (ii) the rights of
the Purchaser (a) under Subsection 9.04 of the Purchase Agreement or (b) to any
premium recapture (i.e., the excess, if any, of the purchase price percentage
over par) in connection with any repurchase pursuant to Subsections 9.03 and
9.05 of the Purchase Agreement.
Recognition of the Company
2. From and after the date hereof (the "Securitization Closing Date"),
the Company shall and does hereby recognize that the Assignee will transfer the
Mortgage Loans and assign its rights under the Purchase Agreement (solely to the
extent set forth herein) and this Agreement to IXIS Real Estate Capital Trust
2007-HE1 (the "Trust") created pursuant to a Pooling and Servicing Agreement,
dated as of January 1, 2007 (the "Pooling Agreement"), among the Assignee, the
Assignor, Deutsche Bank National Trust Company, as trustee (in such capacity,
including its successors in interest and any successor trustees under the
Pooling Agreement, the "Trustee"), Xxxxx Fargo Bank, National Association, as
securities administrator (in such capacity, including its successors in interest
and any successor securities administrators under the Pooling Agreement, the
"Securities Administrator"), master servicer (in such capacity, including its
successors in interest and any successor master servicers under the Pooling
Agreement, the "Master Servicer") and Saxon Mortgage Services, Inc., as servicer
(including its successors in interest and any successor servicer under the
Pooling Agreement, the "Servicer"). The Company hereby acknowledges and agrees
that from and after the date hereof (i) the Trust
will be the owner of the Mortgage Loans, (ii) the Company shall look solely to
the Trust for performance of any obligations of the Assignor insofar as they
relate to the enforcement of the representations, warranties and covenants with
respect to the Mortgage Loans, (iii) the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf) shall have all the rights and remedies available to the Assignor,
insofar as they relate to the Mortgage Loans, under the Purchase Agreement,
including, without limitation, the enforcement of the document delivery
requirements set forth in Section 6 of the Purchase Agreement, and shall be
entitled to enforce all of the obligations of the Company thereunder insofar as
they relate to the Mortgage Loans, and (iv) all references to the Purchaser
(insofar as they relate to the rights, title and interest and, with respect to
obligations of the Purchaser, only insofar as they relate to the enforcement of
the representations, warranties and covenants of the Company), the Custodian or
the Bailee under the Purchase Agreement insofar as they relate to the Mortgage
Loans, shall be deemed to refer to the Trust (including the Trustee, Securities
Administrator, Master Servicer and the Servicer acting on the Trust's behalf).
Neither the Company nor the Assignor shall amend or agree to amend, modify,
waiver, or otherwise alter any of the terms or provisions of the Purchase
Agreement which amendment, modification, waiver or other alteration would in any
way affect the Mortgage Loans or the Company's performance under the Purchase
Agreement with respect to the Mortgage Loans without the prior written consent
of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee
and the Trust as of the date hereof that:
The Company is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation;
The Company has full power and authority to execute, deliver and
perform its obligations under this Agreement and has full power and
authority to perform its obligations under the Purchase Agreement. The
execution by the Company of this Agreement is in the ordinary course of the
Company's business and will not conflict with, or result in a breach of,
any of the terms, conditions or provisions of the Company's charter or
bylaws or any legal restriction, or any material agreement or instrument to
which the Company is now a party or by which it is bound, or result in the
violation of any law, rule, regulation, order, judgment or decree to which
the Company or its property is subject. The execution, delivery and
performance by the Company of this Agreement have been duly authorized by
all necessary corporate action on part of the Company. This Agreement has
been duly executed and delivered by the Company, and, upon the due
authorization, execution and delivery by the Assignor and the Assignee,
will constitute the valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization, insolvency,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and by general principles of equity regardless
of whether enforceability is considered in a proceeding in equity or at
law;
2
Except as has already been obtained, no consent, approval, order or
authorization of, or declaration, filing or registration with, any
governmental entity is required to be obtained or made by the Company in
connection with the execution, delivery or performance by the Company of
this Agreement; and
Except as disclosed in public filings with the Securities Exchange
Commission by the Company or its affiliates, there is no action, suit,
proceeding or investigation pending or threatened against the Company,
before any court, administrative agency or other tribunal, which would draw
into question the validity of this Agreement or the Purchase Agreement, or
which, either in any one instance or in the aggregate, would result in any
material adverse change in the ability of the Company to perform its
obligations under this Agreement or the Purchase Agreement, and the Company
is solvent.
4. Pursuant to Section 13 of the Purchase Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust, that (i) the representations and warranties set forth in
Subsection 9.01 of the Purchase Agreement are true and correct as of the date
hereof as if such representations and warranties were made on the date hereof,
(ii) the information set forth in the Mortgage Loan Schedule, to the extent
provided by the Company, attached hereto as Exhibit A is true and correct as of
the date hereof, and (iii) the representations and warranties set forth on
Exhibit B attached hereto are true and correct as of the date or dates set forth
thereon.
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf) in connection with any breach of the representations and warranties made
by the Company set forth in Sections 3 and 4 hereof shall be as set forth in
Subsection 9.03 of the Purchase Agreement as if they were set forth herein
(including without limitation the repurchase and indemnity obligations set forth
therein); provided, however, that the Assignor specifically reserves and does
not assign to the Assignee hereunder any and all right, title and interest in
the Premium Percentage, if any, due in connection with the repurchase of a
Mortgage Loan pursuant to Subsections 9.03, 9.04 and 9.05.
Miscellaneous
6. The Assignor specifically reserves and does not assign to the
Assignee hereunder any and all right, title and interest in the Premium
Percentage, if any, due in connection with the repurchase of a Mortgage Loan
pursuant to Subsections 9.03, 9.04 and 9.05.
7. This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
8. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced, with the prior
written consent of the Trustee.
3
9. This Agreement shall inure to the benefit of (i) the successors and
assigns of the parties hereto and (ii) the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf). Any entity into which Assignor, Assignee or Company may be merged or
consolidated shall, without the requirement for any further writing, be deemed
Assignor, Assignee or Company, respectively, hereunder.
10. Each of this Agreement and the Purchase Agreement shall survive
the conveyance of the Mortgage Loans and the assignment of the Purchase
Agreement (to the extent assigned hereunder) by Assignor to Assignee and by
Assignee to the Trust and nothing contained herein shall supersede or amend the
terms of the Purchase Agreement.
11. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
12. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
13. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
[SIGNATURE PAGE FOLLOWS]
4
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
ACCREDITED HOME LENDERS, INC.
By: /s/ Xxxxxxx X. Xxxx
------------------------------------
Name: Xxxxxxx X. Xxxx
Its: Associate General Counsel-
Finance AVP & Ass't Sec'y
IXIS REAL ESTATE CAPITAL INC.
By: /s/ F. Xxxx Xxxxxx
------------------------------------
Name: F. Xxxx Xxxxxx
Its: Managing Director
By: /s/ Xxxxxxxxxxx Xxxxxx
------------------------------------
Name: Xxxxxxxxxxx Xxxxxx
Its: Managing Director
XXXXXX XXXXXXX ABS CAPITAL I INC.
By: /s/ Xxxxxxx Xxx
------------------------------------
Name: Xxxxxxx Xxx
Its: Vice President
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
MORTGAGE LOAN SCHEDULE
EXHIBIT B
REPRESENTATIONS AND WARRANTIES AS TO THE MORTGAGE LOANS
The Company hereby represents and warrants as to each Mortgage Loan,
as of the date on which the Company transferred servicing of the Mortgage Loan
to the Assignee or its designee (the "Transfer Date"), unless otherwise set
forth below:
(a)[Reserved];
(b) Payments Current. Except as set forth on the Mortgage Loan
Schedule delivered to the Purchaser by the Company on the Transfer Date, no
payment required to be made up to the Transfer Date under the Mortgage Loan is
30 days or more delinquent nor has any payment under the Mortgage Loan been 30
days or more delinquent at any time since the origination of the Mortgage Loan;
(c) No Outstanding Charges. Except as set forth on the Mortgage Loan
Schedule delivered to the Purchaser by the Company on the Transfer Date, to the
Company's knowledge as of the Transfer Date there are no defaults in complying
with the terms of the Mortgage securing the Mortgage Loan, and all taxes,
governmental assessments, insurance premiums, water, sewer and municipal
charges, leasehold payments or ground rents which previously became due and
owing have been paid, or an escrow of funds has been established in an amount
sufficient to pay for every such item which remains unpaid and which has been
assessed but is not yet due and payable. As of the closing date for the
Securitization Transaction (the "Securitization Closing Date"), except for (A)
payments in the nature of escrow payments and (B) interest accruing from the
date of the Mortgage Note or date of disbursement of the Mortgage Loan proceeds,
whichever is earlier to the day which precedes by one month the Due Date of the
first installment of principal and/or interest, including, without limitation,
taxes and insurance payments, the Company has not advanced funds, or induced,
solicited or knowingly received any advance of funds by a party other than the
Mortgagor, directly or indirectly, for the payment of any amount required under
the Mortgage Loan;
(d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any respect,
from the date of origination 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 Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. 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, and which assumption agreement is part of the Mortgage File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the Mortgage Loan
Schedule;
(e) 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
B-1
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, and no Mortgagor was a debtor in
any state or federal bankruptcy or insolvency proceeding at, or subsequent to,
the time the Mortgage Loan was funded;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are customary in the area where the Mortgaged Property
is located, as well as all additional requirements set forth in Section 2.10 of
the Interim Servicing Agreement. If required by the National Flood Insurance Act
of 1968, as amended, each Mortgage Loan is covered by a flood insurance policy
meeting the requirements of the current guidelines of the Federal Insurance
Administration in effect, as well as all additional requirements set forth in
Section 2.10 of the Interim Servicing Agreement. All individual insurance
policies contain a standard mortgagee clause naming the Company and its
successors and assigns as mortgagee, and all premiums thereon have been paid and
such policies may not be reduced, terminated or cancelled without 30 days' prior
written notice to the mortgagee. The Mortgage obligates the Mortgagor thereunder
to maintain the hazard insurance policy at the Mortgagor's cost and expense, and
on the Mortgagor's failure to do so, authorizes the holder of the Mortgage to
obtain and maintain such insurance at such Mortgagor's cost and expense, and to
seek reimbursement therefor from the Mortgagor. Where required by state law or
regulation, the Mortgagor has been given an opportunity to choose the carrier of
the required hazard insurance, provided the policy is not a "master" or
"blanket" hazard insurance policy covering a condominium, or any hazard
insurance policy covering the common facilities of a planned unit development.
The hazard insurance policy is the valid and binding obligation of the insurer,
is in full force and effect, and will be in full force and effect and inure to
the benefit of the Purchaser upon the consummation of the purchase transactions
contemplated by this Agreement. As of the Securitization Closing Date, the
Company has not engaged in, and has no knowledge of the Mortgagor's or any
servicer's having engaged in, any act or omission which would impair the
coverage of any such policy, the benefits of the endorsement provided for
herein, or the validity and binding effect of such policy, including, without
limitation, no unlawful fee, commission, kickback or other unlawful compensation
or value of any kind has been or will be received, retained or realized by any
attorney, firm or other person or entity, and no such unlawful items have been
received, retained or realized by the Company;
(g) Compliance with Applicable Laws. As of the Securitization Closing
Date, 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, predatory and abusive lending, equal credit
opportunity and disclosure laws applicable to the Mortgage Loan, including,
without limitation, any provisions relating to Prepayment Charges, have been
complied with, the consummation of the transactions contemplated hereby will not
involve the violation of any such laws or regulations, 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. Notwithstanding the foregoing, the Company shall not be
responsible for a breach of a federal, state or local law, other than those
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governing (i) the origination and (ii) servicing of the Mortgage Loans by the
Company during the interim servicing period, following the Transfer Date;
(h) No Satisfaction of Mortgage. The Mortgage has not been satisfied,
canceled, subordinated (except to a senior mortgage in the case of a Second Lien
Loan) 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 release, cancellation,
subordination or rescission. The Company has not waived the performance by the
Mortgagor of any action, if the Mortgagor's failure to perform such action would
cause the Mortgage Loan to be in default, nor has the Company waived any default
resulting from any action or inaction by the Mortgagor;
(i) Location and Type of Mortgaged Property. The Mortgaged Property is
a fee simple property located in the state identified in the related Mortgage
Loan Schedule, except that with respect to real property located in
jurisdictions in which the use of leasehold estates for residential properties
is a widely-accepted practice, the Mortgaged Property may be a leasehold estate,
and consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a condominium project, or an individual unit in
a planned unit development; provided, however, that no residence or dwelling is
a mobile home and any condominium unit or planned unit development shall not
fall within any of the "Ineligible Projects" of part XII, Section 102 of the
Xxxxxx Xxx Selling Guide and shall conform with the Underwriting Guidelines. In
the case of any Mortgaged Properties that are manufactured homes (a
"Manufactured Home Mortgage Loans"), (i) such Manufactured Home Mortgage Loan
conforms with the applicable Xxxxxx Mae or Xxxxxxx Mac requirements regarding
mortgage loans related to manufactured dwellings, (ii) the related manufactured
dwelling is permanently affixed to the land, (iii) the related manufactured
dwelling and the related land are subject to a Mortgage properly filed in the
appropriate public recording office and naming Company as mortgagee, (iv) the
applicable laws of the jurisdiction in which the related Mortgaged Property is
located will deem the manufactured dwelling located on such Mortgaged Property
to be a part of the real property on which such dwelling is located, and (v)
such Manufactured Home Mortgage Loan is (x) a qualified mortgage under Section
860G(a)(3) of the Internal Revenue Code of 1986, as amended and (y) secured by
manufactured housing treated as a single family residence under Section
25(e)(10) of the Code. As of the date of origination, no portion of the
Mortgaged Property was used for commercial purposes, and, to the Company's
knowledge as of the Transfer Date, no portion of the Mortgaged Property has been
used for commercial purposes; provided, that Mortgaged Properties which contain
a home office shall not be considered as being used for commercial purposes as
long as the Mortgaged Property has not been altered for commercial purposes and
is not storing any chemicals or raw materials other than those commonly used for
homeowner repair, maintenance and/or household purposes;
(j) Valid First and Second Lien. Each Mortgage is a valid and
subsisting first lien, with respect to First Lien Loans, or second lien, with
respect to Second Lien Loans, of record on a single parcel of real estate
constituting the Mortgaged Property, including all buildings and improvements 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,
subject in all cases to
B-3
the exceptions to title set forth in the title insurance policy with respect to
the related Mortgage Loan, which exceptions are generally acceptable to prudent
mortgage lending companies, and such other exceptions to which similar
properties are commonly subject and which do not individually, or in the
aggregate, materially and adversely affect the benefits of the security intended
to be provided by such Mortgage. In no event shall any Mortgage Loan be in a
lien position more junior than a second lien. The lien of the Mortgage is
subject only to:
(i) with respect to Second Lien Loans, the lien of the first
mortgage on the Mortgaged Property;
(ii) the lien of current real property taxes and assessments not
yet due and payable;
(iii) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date of
recording acceptable to prudent mortgage lending institutions
generally and specifically referred to in the lender's title insurance
policy delivered to the originator of the Mortgage Loan and (a)
specifically referred to or otherwise considered in the appraisal made
for the originator of the Mortgage Loan or (b) which do not adversely
affect the Appraised Value of the Mortgaged Property set forth in such
appraisal; 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.
Any security agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates a valid,
subsisting, enforceable (subject to bankruptcy, insolvency and similar laws
affecting the rights of creditors and general principles of equity) and
perfected (A) first lien and first priority security interest with respect to
each First Lien Loan, or (B) second lien and second priority security interest
with respect to each Second Lien Loan, in either case, on the property described
therein and Company has full right to sell and assign the same to Purchaser.
With respect to each Second Lien Loan, the Mortgaged Property was not, as of the
date of origination of such Second Lien Loan, subject to a mortgage, deed of
trust, deed to secure debt or other security instrument creating a lien
subordinate to the lien of the Mortgage;
(k) Validity of Mortgage Documents. The Mortgage Note and the Mortgage
and any other agreement executed and delivered by a Mortgagor or guarantor, if
applicable, in connection with a Mortgage Loan are genuine, and each is the
legal, valid and binding obligation of the maker thereof enforceable in
accordance with its terms, subject to bankruptcy, insolvency and similar laws
affecting the rights of creditors and general principles of equity (including,
without limitation, any provisions therein relating to Prepayment Charges). All
parties to the Mortgage Note, the Mortgage and any other such related agreement
had legal capacity to enter into the Mortgage Loan and to execute and deliver
the Mortgage Note, the Mortgage and any other related agreement, and the
Mortgage Note, the Mortgage and any other such related agreement have been duly
and properly executed by other such related parties. The documents,
B-4
instruments and agreements submitted for loan underwriting were not falsified
and contain no untrue statement of material fact or omit to state a material
fact required to be stated therein or necessary to make the information and
statements therein not misleading. As of the Securitization Closing Date, no
fraud, error, omission, misrepresentation, negligence or similar occurrence with
respect to a Mortgage Loan has taken place on the part of any Person, including
without limitation, the Mortgagor, any appraiser, any builder or developer, or
any other party involved in the origination or servicing of the Mortgage Loan.
The Company has reviewed all of the documents constituting the Servicing File
and has made such inquiries as it deems necessary to make and confirm the
accuracy of the representations set forth herein;
(l) Full Disbursement of Proceeds. Except to the extent the Mortgage
Loan is subject to completion escrows which have been disclosed to and
acknowledged by the Purchaser and which meet the requirements of the
Underwriting Guidelines and as to which a completed Xxxxxx Xxx Form 442 has been
delivered to the Purchaser within sixty (60) days after the related Closing
Date, as of the Securitization Closing Date, the Mortgage Loan has been closed
and the proceeds of the Mortgage Loan have been fully disbursed and there is no
requirement for future advances thereunder, and any and all requirements as to
completion of any on-site or off-site improvement and as to disbursements of any
escrow funds therefor have been complied with. As of the Securitization Closing
Date, 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;
(m) Ownership. As of the Closing Date, the Company or MERS was the
sole owner of record and holder of the Mortgage Loan and the indebtedness
evidenced by each Mortgage Note and upon the sale of the Mortgage Loans to the
Purchaser, the Company retained the Mortgage Files or any part thereof with
respect thereto not delivered to the Custodian, the Purchaser or the Purchaser's
designee, in trust only for the purpose of servicing and supervising the
servicing of each Mortgage Loan. As of the Closing Date, upon payment of the
related Purchase Price, the Mortgage Loan was not assigned or pledged, and the
Company had good, indefeasible and marketable title thereto, and had full right
to transfer and sell the Mortgage Loan to the Purchaser free and clear of any
encumbrance, equity, participation interest, lien, pledge, charge, claim or
security interest, and had full right and authority subject to no interest or
participation of, or agreement with, any other party, to sell and assign each
Mortgage Loan pursuant to the Purchase Agreement and immediately following the
sale of each Mortgage Loan, the Purchaser owned such Mortgage Loan free and
clear of any encumbrance, equity, participation interest, lien, pledge, charge,
claim or security interest related to the Company. As of the Closing Date, the
Company intended to relinquish all rights to possess, control and monitor the
Mortgage Loan. Since the Closing Date, the Company has had and will have no
right to modify or alter the terms of the sale of the Mortgage Loan and the
Company has had and will have no obligation or right to repurchase the Mortgage
Loan or substitute another Mortgage Loan, except as provided in the Purchase
Agreement;
(n) Doing Business. As of the Closing Date, 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 (2) either (i) organized under the laws of such state, or (ii) qualified to
do
B-5
business, or exempt from such qualification, in such state, or (iii) a federal
savings and loan association, a savings bank or a national bank having a
principal office in such state, or (3) not doing business in such state;
(o) CLTV, LTV; FICO Score. As of the Securitization Closing Date, no
Mortgage Loan that is a Second Lien Loan has a CLTV in excess of 100% and no
Mortgage Loan has an LTV greater than 100%. At origination of the Mortgage Loan,
the Mortgagor did not have a FICO score of less than 500;
(p) Title Insurance. The Mortgage Loan is covered by an ALTA lender's
title insurance policy or other generally acceptable form of policy or insurance
acceptable to Xxxxxx Xxx or Xxxxxxx Mac and each such title insurance policy is
issued by a title insurer acceptable to 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
(with respect to First Lien Loans) or second priority lien (with respect to
Second Lien Loans) of the Mortgage in the original principal amount of the
Mortgage Loan, subject only to the exceptions contained in clauses (1), (2) and
(3) of paragraph (j) of this Exhibit B, and in the case of Adjustable Rate
Mortgage Loans, against any loss by reason of the invalidity or unenforceability
of the lien resulting from the provisions of the Mortgage providing for
adjustment to the Mortgage Interest Rate and Monthly Payment. Where required by
state law or regulation, the Mortgagor has been given the opportunity to choose
the carrier of the required mortgage title insurance. Additionally, such
lender's title insurance policy affirmatively insures ingress and egress, and
against encroachments by or upon the Mortgaged Property or any interest therein.
The title policy does not contain any special exceptions (other than the
standard exclusions) for zoning and uses and has been marked to delete the
standard survey exception or to replace the standard survey exception with a
specific survey reading. The Company, its successor and assigns, are the sole
insureds of such lender's title insurance policy, and to the Company's knowledge
as of the Transfer Date, such lender's title insurance policy is valid and
remains in full force and effect and will be in force and effect upon the
consummation of the purchase transactions contemplated by this Agreement. Except
as disclosed in writing by the Company to the Purchaser on or prior to the
Transfer Date, no claims have been made under such lender's title insurance
policy, and no prior holder of the related Mortgage, including the Company, has
done, by act or omission, anything which would impair the coverage of such
lender's title insurance policy, including without limitation, no unlawful fee,
commission, kickback or other unlawful compensation or value of any kind has
been or will be received, retained or realized by any attorney, firm or other
person or entity, and no such unlawful items have been received, retained or
realized by the Company;
(q) No Defaults. Other than payments due but not yet 30 days or more
delinquent, as of the Closing Date and to the Company's knowledge as of the
Transfer Date (except as set forth on the Mortgage Loan Schedule delivered by
the Company to the Purchaser on the Transfer Date), there is no default, breach,
violation or event which would permit acceleration existing under the Mortgage
or the Mortgage Note and 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 which would permit acceleration, and neither the
Company nor any of its affiliates nor any of their respective predecessors, have
waived any default, breach, violation or event which would permit acceleration.
With respect to each Second Lien Loan, as
B-6
of the Closing Date and to the Company's knowledge as of the Transfer Date, (i)
the prior mortgage is in full force and effect, (ii) there is no default,
breach, violation or event of acceleration existing under such prior mortgage or
the related mortgage note and (iii) there is 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 of acceleration thereunder, and
either (A) the prior mortgage contains a provision which allows or (B)
applicable law or the related Mortgage requires, the mortgagee under the Second
Lien Loan to receive notice of, and affords such mortgagee an opportunity to
cure any default by payment in full or otherwise under the prior mortgage;
(r) No Mechanics' Liens. Except as insured against by the related
title insurance, as of the Closing Date and to the Company's knowledge as of the
Transfer Date (except as disclosed in writing by the Company to the Purchaser on
or prior to the Transfer Date), 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;
(s) Location of Improvements; No Encroachments. 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. As of the Closing Date and to the Company's knowledge as of
the Transfer Date (except as disclosed in writing by the Company to the
Purchaser on or prior to the Transfer Date), the Mortgaged Property and all
improvements located on or being part of the Mortgaged Property are in
compliance with all applicable zoning and building laws, ordinances and
regulations;
(t) Origination; Payment Terms. As of the Securitization Closing Date,
the Mortgage Loan was originated by a mortgagee approved by the Secretary of
Housing and Urban Development pursuant to Sections 203 and 211 of the Act, a
savings and loan association, a savings bank, a commercial bank, credit union,
insurance company or other similar institution which is supervised and examined
by a federal or state authority. The documents, instruments and agreements
submitted for loan underwriting were not falsified and contain no untrue
statement of material fact or omit to state a material fact required to be
stated therein or necessary to make the information and statements therein not
misleading. No Mortgage Loan contains terms or provisions which would result in
negative amortization. Principal and/or interest payments on the Mortgage Loan
commenced or will commence no more than sixty days after funds were disbursed in
connection with the Mortgage Loan. The Mortgage Interest Rate as well as, with
respect to Adjustable Rate Mortgage Loans, the Lifetime Rate Cap, the Periodic
Rate Floor and the Periodic Rate Cap are as set forth on the related Mortgage
Loan Schedule. The Mortgage Interest Rate is required to be adjusted, with
respect to Adjustable Rate Mortgage Loans, on each Interest Rate Adjustment Date
to equal the Index plus the Gross Margin (rounded up or down to the nearest
0.125%), subject to the Periodic Rate Cap, the Periodic Rate Floor and the
Lifetime Rate Cap. Subject to a "balloon" payment in the case of a Balloon
Mortgage Loan, the Mortgage Note is payable in equal monthly installments of
principal and/or interest, which installments are subject to change due to
adjustments to the Mortgage Interest Rate and/or Monthly Payment on each
Interest Rate Adjustment Date or Monthly Payment Adjustment Date,
B-7
with interest calculated and payable in arrears, sufficient to amortize the
Mortgage Loan fully by the stated maturity date (unless the Mortgage Loan is
identified on the Mortgage Loan Schedule as a Balloon Mortgage Loan or an
Interest Only Mortgage Loan), over an original term of not more than thirty
years from commencement of amortization. Unless otherwise specified on the
related Mortgage Loan Schedule, the Mortgage Loan is payable on the first day of
each month. There are no Convertible Mortgage Loans which contain a provision
allowing the Mortgagor to convert the Mortgage Note from an adjustable interest
rate Mortgage Note to a fixed interest rate Mortgage Note. The Due Date of the
first payment under the Mortgage Note is no more than 60 days from the date of
the Mortgage Note;
(u) Customary Provisions. The Mortgage contains customary and
enforceable provisions (subject to bankruptcy, insolvency, and similar laws
affecting the rights of creditors and general principles of equity) 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. Upon
default by a Mortgagor on a Mortgage Loan and foreclosure on, or trustee's sale
of, the Mortgaged Property pursuant to the proper procedures, the holder of the
Mortgage Loan will be able to deliver good and merchantable title to the
Mortgaged Property. 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, subject to applicable
federal and state laws and judicial precedent with respect to bankruptcy and
right of redemption or similar law;
(v) Conformance with Agency and Underwriting Guidelines. The Mortgage
Loan was underwritten in accordance with the related Underwriting Guidelines.
The Mortgage Note and Mortgage are on forms acceptable in the secondary mortgage
market and no representations have been made to a Mortgagor that are
inconsistent with the mortgage instruments used;
(w) Occupancy of the Mortgaged Property. As of the Closing Date, and
to the Company's knowledge as of the Transfer Date, the Mortgaged Property is
capable of being lawfully occupied under applicable law. As of the Closing Date,
and to the Company's knowledge as of the Transfer Date, 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. The Company has not received notification from any
Governmental Authority that the Mortgaged Property is in material non-compliance
with such laws or regulations, is being used, operated or occupied unlawfully or
has failed to have or obtain such inspection, licenses or certificates, as the
case may be. The Company has not received notice of any violation or failure to
conform with any such law, ordinance, regulation, standard, license or
certificate. If the Mortgage Loan is identified as "owner-occupied" in the
related Mortgage Loan Schedule, the Mortgagor represented at the time of
origination of the Mortgage Loan that the Mortgagor would occupy the Mortgaged
Property as the Mortgagor's primary residence;
B-8
(x) No Additional Collateral. The Mortgage Note is not and has not
been secured by any collateral except the lien of the corresponding Mortgage and
the security interest of any applicable security agreement or chattel mortgage
referred to in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and duly qualified under applicable law to serve as
such, has been properly designated and as of the Closing Date, and to the
Company's knowledge as of the Transfer Date, so serves and is named in the
Mortgage (or in the case of a substitution of trustee, is named in a properly
recorded substitution of trustee), and no fees or expenses are or will become
payable by the Purchaser, the Custodian or the Interim Servicer to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor;
(z) Acceptable Investment. To the Company's knowledge as of the
Transfer Date, there are no circumstances or conditions with respect to the
Mortgage, the Mortgaged Property, the Mortgagor, the Mortgage File or the
Mortgagor's credit standing that can reasonably be expected to cause private
institutional investors who invest in mortgage loans similar to the Mortgage
Loan to regard the Mortgage Loan as an unacceptable investment, cause the
Mortgage Loan to become delinquent, or adversely affect the value or
marketability of the Mortgage Loan, or cause the Mortgage Loan to prepay during
any period materially faster or slower than the mortgage loans originated by the
Company generally except for the non-prime nature of the Mortgage Loans and the
related Mortgagor's credit. No Mortgaged Property is located in a state, city,
county or other local jurisdiction as described in the related Purchase Price
and Terms Agreement which the Purchaser has determined in its reasonable good
faith discretion would cause the related Mortgage Loan to be ineligible for
whole loan sale or securitization in a transaction consistent with the
prevailing sale and securitization industry (including, without limitation, the
practice of the rating agencies) with respect to substantially similar mortgage
loans;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the Mortgage,
the Assignment of Mortgage, if any, and any other documents required to be
delivered to the Custodian under this Agreement for each Mortgage Loan have been
delivered to the Custodian. The Company is in possession of a complete, true and
accurate Mortgage File in compliance with Exhibit A to the Purchase Agreement,
except for such documents the originals of which have been delivered to the
Custodian, and the Company has retained copies thereof;
(bb) Condominiums/Planned Unit Developments. As of the Securitization
Closing Date, 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 is in conformance with the related
Underwriting Guidelines;
(cc) Transfer of Mortgage Loans. As of the Securitization Closing
Date, except with respect to MERS Designated Mortgage Loans, the Assignment of
Mortgage with respect to each Mortgage Loan is in recordable form and is
acceptable for recording under the laws of the jurisdiction in which the
Mortgaged Property is located. The transfer, assignment and conveyance of the
Mortgage Notes and the Mortgages by the Company are not subject to the bulk
transfer or similar statutory provisions in effect in any applicable
jurisdiction;
B-9
(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision (subject to applicable law) for the
acceleration of the payment of the unpaid principal balance of the Mortgage Loan
in the event that the Mortgaged Property is sold or transferred without the
prior written consent of the mortgagee thereunder, and such provision is
enforceable, subject to applicable law;
(ee) No Balloon Mortgage Loans. The Mortgage Loan is not a Balloon
Mortgage Loan unless specifically listed on the Mortgage Loan Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to which
Monthly Payments are paid or partially paid with funds deposited in any separate
account established by the Company, the Mortgagor, or anyone on behalf of the
Mortgagor, or paid by any source other than the Mortgagor nor does it contain
any other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan, and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature. The
indebtedness evidenced by the Mortgage Note is not convertible to an ownership
interest in the Mortgaged Property or the Mortgagor and the Company has not
financed nor does it own directly or indirectly, any equity of any form in the
Mortgaged Property or the Mortgagor;
(gg) Consolidation of Future Advances. As of the Securitization
Closing Date, any future advances made to the Mortgagor prior to the applicable
Cut-off Date have been consolidated with the outstanding principal amount
secured by the Mortgage, and the secured principal amount, as consolidated,
bears a single interest rate and single repayment term. The lien of the Mortgage
securing the consolidated principal amount is expressly insured as having first
or second, as applicable, lien priority by a title insurance policy, an
endorsement to the policy insuring the mortgagee's consolidated interest or by
other title evidence acceptable to Xxxxxx Xxx and Xxxxxxx Mac. The consolidated
principal amount does not exceed the original principal amount of the Mortgage
Loan;
(hh) Mortgaged Property Undamaged; No Condemnation Proceedings. As of
the Closing Date, and to the Company's knowledge as of the Securitization
Closing Date (except as disclosed in writing by the Company to the Purchaser on
or prior to the Securitization Closing Date), there is no proceeding pending or
threatened for the total or partial condemnation of the Mortgaged Property. As
of the Closing Date, and to the Company's knowledge as of the Securitization
Closing Date (except as disclosed in writing by the Company to the Purchaser on
or prior to the Securitization Closing Date), the Mortgaged Property is
undamaged by waste, 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 and each Mortgaged Property is in good repair. As of the Closing
Date, there have not been any condemnation proceedings with respect to the
Mortgaged Property.
(ii) Collection Practices; Escrow Deposits; Interest Rate Adjustments.
The origination, servicing and collection practices with respect to the Mortgage
Loan have been in all respects in compliance with Accepted Servicing Practices,
applicable laws and regulations, and have been in all respects legal and proper.
With respect to escrow deposits and Escrow
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Payments (other than with respect to Second Lien Loans for which the mortgagee
under the prior mortgage lien is collecting Escrow Payments), all such payments
are in the possession of, or under the control of, the Company through the
Transfer Date, and, as of such date, there exist no deficiencies in connection
therewith for which customary arrangements for repayment thereof have not been
made that will be assigned without penalty, premium or cost to the Purchaser.
Each Mortgage Loan is covered by a paid in full, life of loan, tax service
contract that will be assigned without penalty, premium or cost to the
Purchaser. All Escrow Payments collected by the Company have been collected in
full compliance with state and federal law and the provisions of the related
Mortgage Note and Mortgage. An escrow of funds is not prohibited by applicable
law and all escrows that have been established have been established in an
amount sufficient 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 by the
Company under the Mortgage or the Mortgage Note. All Mortgage Interest Rate
adjustments have been made in strict compliance with state and federal law and
the terms of the related Mortgage and Mortgage Note on the related Interest Rate
Adjustment Date. If, pursuant to the terms of the Mortgage Note, another index
was selected for determining the Mortgage Interest Rate, the same index was used
with respect to each Mortgage Note which required a new index to be selected,
and such selection did not conflict with the terms of the related Mortgage Note.
Any and all notices required under applicable law and the terms of the related
Mortgage Note and Mortgage regarding the Mortgage Interest Rate and the Monthly
Payment adjustments have been delivered. Any interest required to be paid by the
Company to the Mortgagor pursuant to state, federal and local law has been
properly paid and credited;
(jj) Mortgage Loan Attributes: The Mortgage Loan fits within the
characteristics set forth on Exhibit B to the related Assignment and Conveyance
Agreement;
(kk) Other Insurance Policies; No Defense to Coverage. Except as
disclosed in writing by the Company to the Purchaser on or prior to the Transfer
Date, to the Company's knowledge, no action, inaction or event has occurred and
no state of facts exists or has existed that has resulted or will result in the
exclusion from, denial of, or defense to coverage under any applicable primary
mortgage insurance policy, hazard insurance policy or bankruptcy bond
(including, without limitation, any exclusions, denials or defenses which would
limit or reduce the availability of the timely payment of the full amount of the
loss otherwise due thereunder to the insured), irrespective of the cause of such
failure of coverage. The Company has caused or, before or in connection with the
transfer of servicing, will cause to be performed any and all acts required to
preserve the rights and remedies of the Purchaser in any insurance policies
applicable to the Mortgage Loans including, without limitation, any necessary
notifications of insurers, assignments of policies or interests therein, and
establishments of coinsured, joint loss payee and mortgagee rights in favor of
the Purchaser. In connection with the placement of any such insurance, no
commission, fee, or other compensation has been or will be received by the
Company or by any officer, director, or employee of the Company or any designee
of the Company or any corporation in which the Company or any officer, director,
or employee had a financial interest at the time of placement of such insurance;
(ll) No Violation of Environmental Laws. As of the Closing Date, and
to the Company's knowledge as of the Transfer Date (except as disclosed in
writing by the Company to
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the Purchaser on or prior to the Transfer Date), the Mortgaged Property is free
from any and all toxic or hazardous substances and there exists no violation of
any local, state or federal environmental law, rule or regulation. As of the
Closing Date, and to the Company's knowledge as of the Transfer Date (except as
disclosed in writing by the Company to the Purchaser on or prior to the Transfer
Date), 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. As of the Closing Date, based upon customary and prudent residential
mortgage industry underwriting standards, and as of the Transfer Date (except as
disclosed in writing by the Company to the Purchaser on or prior to the Transfer
Date), in each case to the Company's knowledge, 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;
(mm) 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, or any similar state
statute;
(nn) Appraisal. The Company has delivered to the Purchaser an
appraisal of the Mortgaged Property signed prior to the approval of the Mortgage
application by an appraiser who (i) was licensed in the state where the
Mortgaged Property is located, (ii) had no interest, direct or indirect, in the
Mortgaged Property or in any Mortgage Loan or the security therefor, and (iii)
did not receive compensation that affected the approval or disapproval of the
Mortgage Loan. The appraisal shall have been made within one hundred and eighty
(180) days of the origination of the Mortgage Loan and shall be completed in
compliance with the Uniform Standards of Professional Appraisal Practice, and
all applicable federal and state laws and regulations. If the appraisal was made
more than one hundred and twenty (120) days before the origination of the
Mortgage Loan, the Company shall have received and delivered to the Purchaser a
recertification of the appraisal;
(oo) Disclosure Materials. As of the Securitization Closing Date, the
Mortgagor has, to the extent required by applicable law, executed one or more
statements to the effect that the Mortgagor has, received all disclosure
materials required by applicable law and the Company has complied with all
applicable law with respect to the making of the Mortgage Loans. The Company
shall cause the Interim Servicer to maintain such statement(s) in the Mortgage
File;
(pp) Construction or Rehabilitation of Mortgaged Property. As of the
Securitization Closing Date, the Mortgage Loan was not made to finance the
construction or rehabilitation of a Mortgaged Property or facilitating the
trade-in or exchange of a Mortgaged Property;
(qq) Qualified Mortgage. As of the Closing Date, the Mortgage Loan is
a qualified mortgage under Section 860G(a)(3) of the Code;
(rr) Credit Information. As to each consumer report (as defined in the
Fair Credit Reporting Act, Public Law 91-508) or other credit information
furnished by the Company
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to the Purchaser, the Company has full right and authority and is not precluded
by law or contract from furnishing such information to the Purchaser and the
Purchaser is not precluded by the terms of the Mortgage Loan Documents from
furnishing the same to any subsequent or prospective purchaser of such Mortgage.
The Company shall hold the Purchaser harmless from any and all damages, losses,
costs and expenses (including attorney's fees) arising from disclosure of credit
information in connection with the Purchaser's secondary marketing operations
and the purchase and sale of mortgages. The Company has in its capacity as a
servicer, for each Mortgage Loan, 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;
(ss) Leaseholds. As of the Closing Date, and to the Company's
knowledge as of the Transfer Date, if the Mortgage Loan is secured by a
long-term residential lease, (1) the lessor under the lease holds a fee simple
interest in the land; (2) the terms of such lease expressly permit the
mortgaging of the leasehold estate and the acquisition by the holder of the
Mortgage of the rights of the lessee upon foreclosure or assignment in lieu of
foreclosure or provide the holder of the Mortgage with substantially similar
protections; (3) the terms of such lease do not (a) allow the termination
thereof upon the lessee's default without the holder of the Mortgage being
entitled to receive written notice of, and opportunity to cure, such default,
(b) allow the termination of the lease in the event of damage or destruction as
long as the Mortgage is in existence, (c) prohibit the holder of the Mortgage
from being insured (or receiving proceeds of insurance) under the hazard
insurance policy or policies relating to the Mortgaged Property or (d) permit
any increase in rent other than pre-established increases set forth in the
lease; (4) the original term of such lease is not less than 15 years; (5) the
term of such lease does not terminate earlier than five years after the maturity
date of the Mortgage Note; and (6) the Mortgaged Property is located in a
jurisdiction in which the use of leasehold estates in transferring ownership in
residential properties is a widely accepted practice;
(tt) Prepayment Penalty. The Mortgage Loan is subject to a prepayment
penalty as provided in the related Mortgage Note except as set forth on the
related Mortgage Loan Schedule. With respect to each Mortgage Loan that has a
prepayment penalty feature, each such prepayment penalty is enforceable (subject
to bankruptcy, insolvency, and similar laws affecting the rights of creditors
and general principles of equity) for the benefit of the Purchaser, and each
prepayment penalty is permitted pursuant to applicable law. Each such prepayment
penalty is in an amount not greater than the maximum amount permitted under
applicable law and no such prepayment penalty may be imposed for a term in
excess of five (5) years;
(uu) Conversion to Fixed Interest Rate. With respect to Adjustable
Rate Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;
(vv) Escrow Analysis. With respect to each Mortgage, the Company has
within the twelve months preceding the Closing Date (unless such Mortgage was
originated within such twelve month period) analyzed the required Escrow
Payments for each Mortgage and adjusted the amount of such payments so that,
assuming all required payments are timely made, any deficiency will be
eliminated on or before the first anniversary of such analysis, or
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any overage will be refunded to the Mortgagor, in accordance with RESPA and any
other applicable law;
(ww) Predatory Lending Regulations. No Mortgage Loan is a High Cost
Loan or Covered Loan, as applicable, and no Mortgage Loan originated on or after
October 1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending
Act. No Mortgage Loan is covered by the Home Ownership and Equity Protection Act
of 1994 and no Mortgage Loan is in violation of any comparable state or local
law. The Mortgaged Property is not located in a jurisdiction where a breach of
this representation with respect to the related Mortgage Loan may result in
additional assignee liability to the Purchaser, as determined by Purchaser in
its reasonable discretion and as described in the related Purchase Price and
Terms Agreement;
(xx) Single-premium credit life insurance policy. As of the
Securitization Closing Date, in connection with the origination of the Mortgage
Loan, no proceeds from such Mortgage Loan were used to finance or acquire a
single-premium credit life insurance policy, credit disability, credit
unemployment or credit property insurance policy;
(yy) Regarding the Mortgagor. The Mortgagor is one or more natural
persons and/or an Illinois land trust or a "living trust" and such "living
trust" is in compliance with Xxxxxx Xxx guidelines for such trusts;
(zz) Insurance. The Company has caused or, before or in connection
with the transfer of servicing, will cause to be performed any and all acts
required to preserve the rights and remedies of the Purchaser in any insurance
policies applicable to the Mortgage Loans including, without limitation, any
necessary notifications of insurers, assignments of policies or interests
therein, and establishments of coinsured, joint loss payee and mortgagee rights
in favor of the Purchaser;
(aaa) Simple Interest Mortgage Loans. The Mortgage Loan is not a
simple interest Mortgage Loan;
(bbb) Flood Certification Contract. The Mortgage Loan is covered by a
paid in full, life of loan, transferable flood certification contract that has
been or will be assigned without penalty, cost or premium to the Purchaser;
(ccc) Consent. Either (a) no consent for the Second Lien Loan is
required by the holder of the related first lien or (b) such consent has been
obtained and is contained in the Mortgage File;
(ddd) Origination Date. Except as shown on the related Mortgage Loan
Schedule, the date of origination of the Mortgage Loan shall be no earlier than
three (3) months prior to the date such Mortgage Loan was first purchased by the
Purchaser;
(eee) Mortgage Submitted for Recordation. As of the Closing Date, and
to the Company's knowledge as of the Transfer Date, the Mortgage either has been
or will promptly be submitted for recordation in the appropriate governmental
recording office of the jurisdiction where the Mortgaged Property is located;
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(fff) Endorsements. The Mortgage Note has been endorsed by Company for
its own account and not as a fiduciary, trustee, trustor or beneficiary under a
trust agreement;
(ggg) Accuracy of Information. All information provided to the
Purchaser by the Company with respect to the Mortgage Loan was accurate in all
material respects;
(hhh) No Construction Loans. No Mortgage Loan was made to (a)
facilitate the trade-in or exchange of a Mortgaged Property or (b) finance the
construction or rehabilitation of a Mortgaged Property, unless the Mortgage Loan
is a construction-to-permanent mortgage loan which has been fully disbursed, all
construction work is complete and a completion certificate has been issued;
(iii) No Equity Participation. No document relating to the Mortgage
Loan provides for any contingent or additional interest in the form of
participation in the cash flow of the Mortgaged Property or a sharing in the
appreciation of the value of the Mortgaged Property. The indebtedness evidenced
by the Mortgage Note is not convertible to an ownership interest in the
Mortgaged Property or the Mortgagor and Company has not financed nor does it own
directly or indirectly, any equity of any form in the Mortgaged Property or the
Mortgagor; and
(jjj) No Arbitration. No Mortgagor with respect to any Mortgage Loan
originated on or after August 1, 2004 agreed to submit to arbitration to resolve
any dispute arising out of or relating in any way to the mortgage loan
transaction.
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EXECUTION COPY
===============================================================================
THIRD AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT
----------
IXIS REAL ESTATE CAPITAL INC.,
Purchaser
ACCREDITED HOME LENDERS, INC.,
Seller
----------
Dated as of August 1, 2006
Adjustable-Rate and Fixed-Rate, B/C Residential Mortgage Loans
===============================================================================
TABLE OF CONTENTS
Page
----
SECTION 1. DEFINITIONS.................................................. 1
SECTION 2. AGREEMENT TO PURCHASE........................................ 14
SECTION 3. MORTGAGE SCHEDULES........................................... 14
SECTION 4. PURCHASE PRICE............................................... 14
SECTION 5. EXAMINATION OF MORTGAGE FILES................................ 15
SECTION 6. CONVEYANCE FROM SELLER TO PURCHASER.......................... 15
Subsection 6.01. Conveyance of Mortgage Loans; Possession of
Servicing Files..................................... 15
Subsection 6.02. Books and Records................................... 16
Subsection 6.03. Delivery of Mortgage Loan Documents................. 16
Subsection 6.04. Quality Control Procedures.......................... 17
Subsection 6.05. MERS Designated Mortgage Loans...................... 18
SECTION 7. SERVICING OF THE MORTGAGE LOANS.............................. 18
SECTION 8. TRANSFER OF SERVICING........................................ 18
SECTION 9. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE
SELLER; REMEDIES FOR BREACH................................ 21
Subsection 9.01. Representations and Warranties Regarding
the Seller.......................................... 21
Subsection 9.02. Representations and Warranties Regarding
Individual Mortgage Loans........................... 24
Subsection 9.03. Remedies for Breach of Representations and
Warranties.......................................... 39
Subsection 9.04. Repurchase of Mortgage Loans That Prepay
in Full............................................. 42
Subsection 9.05. Repurchase of Mortgage Loans with First
Payment Defaults.................................... 42
Subsection 9.06. Purchaser's Right to Review......................... 42
SECTION 10. CLOSING...................................................... 43
SECTION 11. CLOSING DOCUMENTS............................................ 44
SECTION 12. COSTS........................................................ 45
SECTION 13. COOPERATION OF SELLER WITH A RECONSTITUTION.................. 45
SECTION 14. THE SELLER................................................... 47
Subsection 14.01. Additional Indemnification by the Seller;
Third Party Claims.................................. 47
Subsection 14.02. Merger or Consolidation of the Seller............... 48
SECTION 15. FINANCIAL STATEMENTS......................................... 48
SECTION 16. MANDATORY DELIVERY; GRANT OF SECURITY INTEREST............... 49
SECTION 17. NOTICES...................................................... 49
SECTION 18. SEVERABILITY CLAUSE.......................................... 50
SECTION 19. COUNTERPARTS................................................. 50
SECTION 20. GOVERNING LAW JURISDICTION; CONSENT TO SERVICE
OF PROCESS................................................... 50
SECTION 21. INTENTION OF THE PARTIES..................................... 51
SECTION 22. SUCCESSORS AND ASSIGNS; ASSIGNMENT OF PURCHASE
AGREEMENT.................................................... 51
SECTION 23. WAIVERS...................................................... 52
SECTION 24. EXHIBITS..................................................... 52
SECTION 25. GENERAL INTERPRETIVE PRINCIPLES.............................. 52
SECTION 26. REPRODUCTION OF DOCUMENTS.................................... 52
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SECTION 27. FURTHER AGREEMENTS........................................... 53
SECTION 28. RECORDATION OF ASSIGNMENTS OF MORTGAGE....................... 53
SECTION 29. NO SOLICITATION.............................................. 53
SECTION 30. WAIVER OF TRIAL BY JURY...................................... 53
SECTION 31. COMPLIANCE WITH REGULATION AB................................ 54
Subsection 31.01. Intent of the Parties; Reasonableness............... 54
Subsection 31.02. Additional Representations and Warranties
of the Seller....................................... 54
Subsection 31.03. Information to Be Provided by the Seller............ 55
Subsection 31.04. Indemnification; Remedies........................... 58
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EXHIBITS
EXHIBIT A CONTENTS OF EACH MORTGAGE FILE
EXHIBIT B [RESERVED]
EXHIBIT C FORM OF SELLER'S OFFICER'S CERTIFICATE
EXHIBIT D FORM OF OPINION OF COUNSEL TO THE SELLER AND THE INTERIM SERVICER
EXHIBIT E FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT F FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT G [RESERVED]
EXHIBIT H FORM OF ASSIGNMENT AND CONVEYANCE AGREEMENT
EXHIBIT I FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
EXHIBIT J FORM OF INDEMNIFICATION AND CONTRIBUTION AGREEMENT
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THIRD AMENDED AND RESTATED
MORTGAGE LOAN PURCHASE AND WARRANTIES AGREEMENT
This THIRD AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND WARRANTIES
AGREEMENT (the "Agreement"), dated as of August 1, 2006, by and between IXIS
Real Estate Capital Inc. f/k/a CDC Mortgage Capital Inc., a New York
corporation, having an office at 0 Xxxx 00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx
Xxxx 00000 (the "Purchaser"), and Accredited Home Lenders, Inc., a California
corporation, having an office at 00000 Xxxxxx xx Xxxxxxx, Xxx Xxxxx, Xxxxxxxxxx
00000 (the "Seller").
WITNESSETH:
WHEREAS, the Purchaser and the Seller are parties to that certain
Second Amended and Restated Mortgage Loan Purchase and Warranties Agreement,
dated as of March 1, 2006 (the "Original Purchase Agreement"), pursuant to which
the Seller desires to sell, from time to time, to the Purchaser, and the
Purchaser desires to purchase, from time to time, from the Seller, certain first
and second lien, adjustable-rate and fixed-rate B/C residential mortgage loans
(the "Mortgage Loans") on a servicing released basis as described herein, and
which shall be delivered in pools of whole loans (each, a "Mortgage Loan
Package") on various dates as provided herein (each, a "Closing Date"); and
WHEREAS, at the present time, the Purchaser and the Seller desire to
amend and restate the Original Purchase Agreement to make certain modifications
as set forth herein, and upon the execution and delivery of this Agreement by
the Purchaser and the Seller this Agreement shall supercede the Original
Purchase Agreement and supplant the Original Purchase Agreement;
NOW, THEREFORE, in consideration of the premises and mutual agreements
set forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Purchaser and the Seller agree
as follows:
SECTION 1. Definitions.
For purposes of this Agreement the following capitalized terms shall
have the respective meanings set forth below.
Accepted Servicing Practices: With respect to any Mortgage Loan, those
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 and incorporating
the Delinquency Collection Policies and Procedures.
Act: The National Housing Act, as amended from time to time.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan
purchased pursuant to this Agreement.
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agency Transfer: A Xxxxxx Xxx Transfer or a Xxxxxxx Mac Transfer.
Agreement: This Third Amended and Restated Mortgage Loan Purchase and
Warranties Agreement and all amendments hereof and supplements hereto.
ALTA: The American Land Title Association and its successors in
interest.
Appraised Value: (i) With respect to any First Lien Loan, the value of
the related Mortgaged Property based upon the appraisal made, if any, for the
originator at the time of origination of the Mortgage Loan or the sales price of
the Mortgaged Property if purchased at or within twelve months prior to such
time of origination, whichever is less, and (ii) with respect to any Second Lien
Loan, the value, determined pursuant to the Seller's Underwriting Guidelines, of
the related Mortgaged Property as of the origination of the Second Lien Loan.
Assignment and Conveyance Agreement: As defined in Subsection 6.01.
Assignment of Mortgage: 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.
Balloon Mortgage Loan: Any Mortgage Loan that requires only payments
of interest until the stated maturity date of the Mortgage Loan or the Monthly
Payments of principal which (not including the payment due on its stated
maturity date) are based on an amortization schedule that would be insufficient
to fully amortize the principal thereof by the stated maturity date of the
Mortgage Loan.
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 State of New York
or the state in which the Interim Servicer's servicing operations are located,
are authorized or obligated by law or executive order to be closed.
Closing Date: The date or dates on which the Purchaser from time to
time shall purchase and the Seller from time to time shall sell the Mortgage
Loans listed on the related Mortgage Loan Schedule with respect to the related
Mortgage Loan Package.
CLTV: As of any date and as to (1) any Second Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the Second Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are senior or equal in
priority to the Second Lien Loan and which are secured by the same Mortgaged
Property to (b) the Appraised Value and (2) any First Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the First Lien Loan and
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(ii) the outstanding principal balance as of such date of any mortgage loan or
mortgage loans that are junior or equal in priority to the First Lien Loan and
which are secured by the same Mortgaged Property to (b) the Appraised Value.
Code: Internal Revenue Code of 1986, as amended.
Commission: The United States Securities and Exchange Commission.
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.
Convertible Mortgage Loan: Any individual Adjustable Rate Mortgage
Loan purchased pursuant to this Agreement which contains a provision whereby the
Mortgagor is permitted to convert the Adjustable Rate Mortgage Loan to a Fixed
Rate Mortgage Loan in accordance with the terms of the related Mortgage Note.
Covered Loan: A Mortgage Loan categorized as Covered pursuant to
Appendix E of Standard & Poor's Glossary.
Credit Files: As defined in Section 5 herein.
Custodial Account: The separate account or accounts created and
maintained pursuant to Section 2.04 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Custodial Agreement: The agreement governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other
Mortgage Loan Documents, to be executed between the Purchaser and the Custodian
and to be dated as of the related Cut-Off Date.
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 therein provided. If at any time there is no Custodial
Agreement in effect with respect to a Mortgage Loan, all references to the
Custodian herein and in the Interim Servicing Agreement shall be deemed to refer
to the Purchaser (or its designee) with respect to such Mortgage Loan.
Cut-off Date: The date or dates designated as such on the related
Mortgage Loan Schedule with respect to the related Mortgage Loan Package.
Deemed Material Breach Representation: Each representation identified
as such in Subsection 9.02.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased or replaced
or to be replaced with a Qualified Substitute Mortgage Loan by the Seller in
accordance with the terms of this Agreement.
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Delinquency Collection Policies and Procedures: The delinquency
collection policies and procedures of the Seller, a copy of which is attached to
the Interim Servicing Agreement.
Depositor: The depositor, as such term is defined in Regulation AB,
with respect to any Securitization Transaction.
Determination Date: The date specified in the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
Due Date: The day of the month on which the Monthly Payment is due on
a Mortgage Loan, exclusive of any days of grace.
Eligible Account: Any of (i) an account maintained with a federal or
state chartered depository institution or trust company the short-term unsecured
debt obligations of which (or, in the case of a depository institution or trust
company 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 or
Prime-1 by Moody's (or a comparable rating if another Rating Agency is specified
by the Purchaser by written notice to the Seller) at the time any amounts are
held on deposit therein, (ii) an account or accounts the deposits in which are
fully insured by the FDIC, or (iii) a trust account or accounts maintained with
a federal or state chartered depository institution or trust company acting in
its fiduciary capacity.
Escrow Account: The separate account or accounts created and
maintained pursuant to Section 2.06 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
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 document.
Exchange Act. The Securities Exchange Act of 1934, as amended.
Xxxxxx Mae: The Federal National Mortgage Association and its
successors in interest.
Xxxxxx Xxx Guides: The Xxxxxx Xxx Xxxxxxx' Guide and the Xxxxxx Xxx
Servicers' Guide and all amendments or additions thereto.
Xxxxxx Mae Transfer: As defined in Section 13 hereof.
FDIC: The Federal Deposit Insurance Corporation and its successors in
interest.
FHA: The Federal Housing Administration, an agency within the United
States Department of Housing and Urban Development and its successors in
interest and including the
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Federal Housing Commissioner and the Secretary of Housing and Urban Development
where appropriate under the FHA Regulations.
First Lien Loan: Any Mortgage Loan secured by a first lien Mortgage on
the related Mortgaged Property.
Fitch: Fitch, Inc. and its successors in interest.
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 in interest.
Xxxxxxx Mac Transfer: As defined in Section 13 hereof.
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 (a) covered by the Home Ownership and
Equity Protection Act of 1994 ("HOEPA"), (b) with an "annual percentage rate" or
total "points and fees" payable by the related Mortgagor (as each such term is
calculated under HOEPA) that exceed the thresholds set forth by HOEPA and its
implementing regulations, including 12 C.F.R. Section 226.32(a)(1)(i) and (ii),
(c) classified as a "high cost home," "threshold," "covered," "high risk home,"
"predatory" or similar loan under any other applicable state, federal or local
law (or a similarly classified loan using different terminology under a law
imposing heightened regulatory scrutiny or additional legal liability for
residential mortgage loans having high interest rates, points and/or fees) or
(d) a Mortgage Loan categorized as High Cost pursuant to Appendix E of Standard
& Poor's Glossary. For avoidance of doubt, the parties agree that this
definition shall apply to any law regardless of whether such law is presently,
or in the future becomes, the subject of judicial review or litigation.
Home Loan: A Mortgage Loan categorized as Home Loan pursuant to
Appendix E of Standard & Poor's Glossary.
HUD: The Department of Housing and Urban Development, or any federal
agency or official thereof which may from time to time succeed to the functions
thereof with regard to FHA Mortgage Insurance. The term "HUD," for purposes of
this Agreement, is also deemed to include subdivisions thereof such as the FHA
and Government National Mortgage Association.
Index: With respect to each Adjustable Rate Mortgage Loan, the index
identified in the related Mortgage Note, as set forth in the related Mortgage
Loan Schedule and as set forth on Exhibit B to each Assignment and Conveyance
Agreement.
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Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
Interest Only Mortgage Loan: A Mortgage Loan which only requires
payments of interest for an initial period of time specified 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 and the Mortgage
Loan Schedule, on which the Mortgage Interest Rate is adjusted.
Interim Funder: With respect to each MERS Designated Mortgage Loan,
the Person named on the MERS(R) System as the interim funder pursuant to the
MERS Procedures Manual.
Interim Servicer: Accredited Home Lenders, Inc., a California
corporation, and its successors in interest, and any successor interim servicer
under the Interim Servicing Agreement.
Interim Servicing Agreement: The Interim Servicing Agreement, dated as
of October 1, 2003, between the Purchaser and the Interim Servicer, providing
for the Interim Servicer to service the Mortgage Loans for an interim period as
specified by the Interim Servicing Agreement.
Investor: With respect to each MERS Designated Mortgage Loan, the
Person named on the MERS(R) System as the investor pursuant to the MERS
Procedures Manual.
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 is not at any time to exceed the Mortgage Interest
Rate at the time of origination of such Adjustable Rate Mortgage Loan by more
than the Lifetime Rate Cap.
Liquidation Proceeds: Cash 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 or otherwise, or the sale of the
related Mortgaged Property if the Mortgaged Property is acquired in satisfaction
of the Mortgage Loan.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan, the
ratio (expressed as a percentage) of the outstanding principal amount of the
Mortgage Loan as of the Cut-off Date (unless otherwise indicated), to the
Appraised Value of the Mortgaged Property.
MERS: Mortgage Electronic Registration Systems, Inc., a Delaware
corporation, and its successors and assigns.
MERS Designated Mortgage Loan: Mortgage Loans for which (a) the Seller
has designated or will designate MERS as, and has taken or will take such action
as is necessary to cause MERS to be, the mortgagee of record, as nominee for the
Seller, in accordance with
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MERS Procedure Manual and (b) the Seller has designated or will designate the
Purchaser as the Investor on the MERS(R) System.
MERS Procedure Manual: The MERS Procedures Manual, as it may be
amended, supplemented or otherwise modified from time to time.
MERS Report: The report from the MERS System listing MERS Designated
Mortgage Loans and other information.
MERS(R) System: MERS mortgage electronic registry system, as more
particularly described in the MERS Procedures Manual.
Monthly Payment: The scheduled monthly payment of principal and/or
interest on a Mortgage Loan.
Monthly Payment Adjustment Date: With respect to each Interest Only
Mortgage Loan which is also a Fixed Rate Mortgage Loan, the date, specified in
the related Mortgage Note and the Mortgage Loan Schedule, on which the Monthly
Payment is adjusted.
Moody's: Xxxxx'x Investors Service, Inc. and its successors in
interest.
Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note, which creates a first lien, in the case of a First Lien Loan, or
a second lien, in the case of a Second Lien Loan, on the Mortgaged Property.
Mortgage File: The items pertaining to a particular Mortgage Loan
referred to in Exhibit A 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 with respect to each Mortgage Loan.
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 applicable Mortgage Loan Schedule, which Mortgage Loan
includes without limitation the Mortgage File, the Monthly Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
Servicing Rights, and all other rights, benefits, proceeds and obligations
arising from or in connection with such Mortgage Loan, excluding replaced or
repurchased mortgage loans.
Mortgage Loan Documents: The documents required to be delivered to the
Custodian pursuant to Section 6.03 hereof with respect to any Mortgage Loan.
Mortgage Loan Package: Each pool of Mortgage Loans, which shall be
purchased by the Purchaser from the Seller from time to time on each Closing
Date.
Mortgage Loan Schedule: The schedule of Mortgage Loans setting forth
the following information with respect to each Mortgage Loan in the related
Mortgage Loan
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Package: (1) the Seller's Mortgage Loan identifying number; (2) the Mortgagor's
name; (3) the street address of the Mortgaged Property including the city, state
and zip code; (4) a code indicating whether the Mortgaged Property is
owner-occupied, a second home or investment property; (5) the number and type of
residential units constituting the Mortgaged Property (i.e., a single family
residence, a 2-4 family residence, a unit in a condominium project or a unit in
a planned unit development, manufactured housing); (6) the Mortgage Loan
origination date; (7) the original months to maturity or the remaining months to
maturity from the related Cut-off Date, in any case based on the original
amortization schedule and, if different, the maturity expressed in the same
manner but based on the actual amortization schedule; (8) the Loan-to-Value
Ratio at origination; (9) with respect to First Lien Loans, the LTV and with
respect to Second Lien Loans, the CLTV; (10) the Mortgage Interest Rate as of
the related Cut-off Date; (11) the date on which the Monthly Payment was due on
the Mortgage Loan and, if such date is not consistent with the Due Date
currently in effect, such Due Date; (12) the stated maturity date; (13) the
amount of the Monthly Payment as of the related Cut-off Date; (14) the last
payment date as of which a payment was actually applied to the outstanding
principal balance; (15) the original principal amount of the Mortgage Loan; (16)
the principal balance of the Mortgage Loan as of the close of business on the
related Cut-off Date, after deduction of payments of principal due and collected
on or before the Cut-off Date; (17) the Interest Rate Adjustment Date; (18) the
Gross Margin; (19) the Lifetime Rate Cap under the terms of the Mortgage Note;
(20) a code indicating the type of Index; (21) the Mortgage Interest Rate as of
origination; (22) the type of Mortgage Loan (i.e., fixed-rate, adjustable-rate,
First Lien, Second Lien); (23) a code indicating the purpose of the loan (i.e.,
purchase, rate and term refinance, equity take-out refinance); (24) a code
indicating the documentation style (i.e., full or stated income); (25) the loan
credit classification (as described in the Underwriting Guidelines); (26) the
applicable Cut-off Date; (27) the applicable Closing Date; (28) the credit risk
score (FICO score); (29) with respect to the related Mortgagor, the
debt-to-income ratio; (30) with respect to Second Lien Loans, the outstanding
principal balance of the superior lien; (31) the Appraised Value of the
Mortgaged Property; (32) the sale price of the Mortgaged Property if the
Mortgage Loan was originated in connection with the purchase of the Mortgaged
Property; (33) the Periodic Rate Cap under the terms of the Mortgage Note; (34)
the Periodic Rate Floor under the terms of the Mortgage Note; (35) whether such
Mortgage Loan provides for a prepayment penalty; (36) the prepayment penalty
period of such Mortgage Loan, if applicable; (37) a description of the type of
prepayment penalty, if applicable; (38) the MERS Identification Number; (39)
whether the Mortgagor represented that the Mortgagor would occupy the Mortgaged
Property as its primary residence; (40) a code indicating if the Mortgage Loan
is a Balloon Mortgage Loan [and (41) a field indicating whether such Mortgage
Loan is a Home Loan]. With respect to the Mortgage Loans in the aggregate, the
Mortgage Loan Schedule shall set forth the following information, as of the
related Cut-off Date: (1) the number of Mortgage Loans; (2) the current
aggregate outstanding principal balance of the Mortgage Loans; (3) the weighted
average Mortgage Interest Rate of the Mortgage Loans; and (4) the weighted
average maturity of the Mortgage Loans.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
Mortgaged Property: With respect to each Mortgage Loan, the
Mortgagor's real property securing repayment of a related Mortgage Note,
consisting of an unsubordinated estate in fee simple or, with respect to real
property located in jurisdictions in which the use of
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leasehold estates for residential properties is a widely-accepted practice, a
leasehold estate, in a single parcel or multiple parcels of real property
improved by a residential dwelling as further described in this Agreement.
Mortgagor: The obligor on a Mortgage Note.
OCC: Office of the Comptroller of the Currency and its successors in
interest.
Officer's Certificate: A certificate signed by the Chairman of the
Board or the Vice Chairman of the Board or a President or a Vice President and
by the Treasurer or the Secretary or one of the Assistant Treasurers or
Assistant Secretaries of the Seller, and delivered to the Purchaser as required
by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be in-house
counsel for the Seller, reasonably acceptable to the Purchaser, provided that
any Opinion of Counsel relating to (a) the qualification of any account required
to be maintained pursuant to this Agreement as an Eligible Account, (b)
qualification of the Mortgage Loans in a REMIC or (c) compliance with the REMIC
Provisions, must be (unless otherwise stated in such Opinion of Counsel) an
opinion of counsel who (i) is in fact independent of the Seller and any servicer
of the Mortgage Loans, (ii) does not have any material direct or indirect
financial interest in the Seller or any servicer of the Mortgage Loans or in an
Affiliate of either and (iii) is not connected with the Seller or any servicer
of the Mortgage Loans as an officer, employee, director or person performing
similar functions.
OTS: Office of Thrift Supervision and its successors in interest.
Periodic Rate Cap: 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 increase on an Interest
Rate Adjustment Date above the Mortgage Interest Rate previously in effect.
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.
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.
Points Schedule: A schedule which sets forth, with respect to each
Mortgage Loan, the following data points: (1) the loan identification number;
(2) the pool name; (3) the Seller's points; (4) the Seller's rebate; (5) the
Seller's fees; (6) the broker fees and (7) the broker points. All information on
the Points Schedule shall be true, correct and complete.
Preliminary Mortgage Schedule: As defined in Section 3.
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Premium Percentage: With respect to any Mortgage Loan, a percentage
equal to the excess of the Purchase Price Percentage over 100%.
Prepayment Charges: With respect to each Mortgage Loan, the charge if
the Mortgagor prepays such Mortgage Loan as provided in the related Mortgage
Note or Mortgage.
Principal Prepayment: Any payment or other recovery of principal on a
Mortgage Loan 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.
Purchase Price: The price paid on the related Closing Date by the
Purchaser to the Seller in exchange for the Mortgage Loans purchased on such
Closing Date as calculated in Section 4 of this Agreement.
Purchase Price and Terms Agreement: Those certain agreements setting
forth the general terms and conditions of the transactions consummated herein
and identifying the Mortgage Loans to be purchased from time to time hereunder,
by and among the Seller, the Purchaser and the Interim Servicer (if applicable).
All of the individual Purchase Price and Terms Agreements shall collectively be
referred to as the "Purchase Price and Terms Agreement."
Purchase Price Percentage: With respect to any Mortgage Loan, an
amount equal to the percentage of par as stated in the Purchase Price and Terms
Agreement (subject to adjustment as provided therein) related to such Mortgage
Loan.
Purchaser: IXIS Real Estate Capital Inc., a New York corporation, and
its successors in interest and assigns, or any successor to the Purchaser under
this Agreement as herein provided.
Qualified Correspondent: Any Person from which the Seller purchased
Mortgage Loans, provided that the following conditions are satisfied: (i) such
Mortgage Loans were originated pursuant to an agreement between the Seller and
such Person that contemplated that such Person would underwrite mortgage loans
from time to time, for sale to the Seller, in accordance with underwriting
guidelines designated by the Seller ("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 Seller within one hundred eighty (180) days after origination; (iii) either
(x) the Designated Guidelines were, at the time such Mortgage Loans were
originated, used by the Seller in origination of mortgage loans of the same type
as the Mortgage Loans for the Seller's own account or (y) the Designated
Guidelines were, at the time such Mortgage Loans were underwritten, designated
by the Seller on a consistent basis for use by lenders in originating mortgage
loans to be purchased by the Seller; and (iv) the Seller employed, at the time
such Mortgage Loans were acquired by the Seller, pre purchase or post purchase
quality assurance procedures (which may involve, among other things, review of a
sample of mortgage loans purchased during a particular time
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period or through particular channels) designed to ensure that Persons from
which it purchased mortgage loans properly applied the underwriting criteria
designated by the Seller.
Qualified Substitute Mortgage Loan: A mortgage loan eligible to be
substituted by the Seller for a Deleted Mortgage Loan which must, on the date of
such substitution, (i) have an outstanding principal balance, after deduction of
all scheduled payments due in the month of substitution (or in the case of a
substitution of more than one mortgage loan for a Deleted Mortgage Loan, an
aggregate principal balance), not in excess of the outstanding principal balance
of the Deleted Mortgage Loan (the amount of any shortfall will be deposited in
the Custodial Account by the Seller in the month of substitution); (ii) have a
Mortgage Interest Rate not less than and not more than 1% greater than the
Mortgage Interest Rate of the Deleted Mortgage Loan; (iii) have a remaining term
to maturity not greater than and not more than one (1) year less than that of
the Deleted Mortgage Loan; (iv) be of the same type as the Deleted Mortgage Loan
(i.e., fixed-rate, adjustable-rate with same Periodic Rate Cap, Index and lien
priority); and (v) comply with each representation and warranty (respecting
individual Mortgage Loans) set forth in Section 9 hereof.
Rating Agency: Any of Fitch, Moody's or Standard & Poor's, or their
respective successors designated by the Purchaser.
Reconstitution: Any Securitization Transaction or Whole Loan Transfer.
Reconstitution Agreements: The agreement or agreements entered into by
the Seller and/or the Interim Servicer and the Purchaser and/or certain third
parties on the Reconstitution Date or Dates with respect to any or all of the
Mortgage Loans sold hereunder, in connection with a Whole Loan Transfer, Agency
Transfer or a Securitization Transaction pursuant to Section 13, including, but
not limited to, a seller's warranties and servicing agreement with respect to a
Whole Loan Transfer, and a trust and servicing agreement and related
custodial/trust agreement and documents with respect to a Securitization
Transaction.
Reconstitution Date: As defined in Section 13.
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. Sections 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.
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Remittance Date: The date specified in the Interim Servicing Agreement
(with respect to each Mortgage Loan, for an interim period, as specified
therein).
Repurchase Price: With respect to any Mortgage Loan for which a breach
of a representation or warranty from the Agreement or the Interim Servicing
Agreement is found, a price equal to the then outstanding principal balance of
the Mortgage Loan to be repurchased, plus accrued interest thereon at the
Mortgage Interest Rate from the date to which interest had last been paid
through the date of such repurchase, plus the amount of any outstanding advances
owed to any servicer, and plus all costs and expenses reasonably incurred by the
Purchaser or any servicer arising out of or based upon such breach, including
without limitation costs and expenses incurred in the enforcement of the
Seller's repurchase obligation hereunder.
RESPA: Real Estate Settlement Procedures Act, as amended from time to
time.
Second Lien Loan: A Mortgage Loan secured by a second lien Mortgage on
the related Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Securitization Transaction. Any transaction involving either (1) 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 (2)
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.
Seller: Accredited Home Lenders, Inc., a California corporation, and
its successors in interest.
Seller Information: As defined in Subsection 31.04(a).
Servicing Fee: With respect to each Mortgage Loan subject to the
Interim Servicing Agreement, an amount equal to 0.50% per annum computed on the
basis of the outstanding principal balance of the related Mortgage Loan. Such
fee shall be payable monthly and shall be pro rated for any portion of a month,
other than the month in which the related Closing Date occurs, during which the
Mortgage Loan is serviced by the Interim Servicer under the Interim Servicing
Agreement. 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 this Agreement) of such Monthly Payment collected by the
Interim Servicer, or as otherwise provided under this Agreement.
Servicing File: With respect to each Mortgage Loan, the file retained
by the Interim Servicer consisting of originals of all documents in the Mortgage
File which are not delivered to the Purchaser or the Custodian and copies of the
Mortgage Loan Documents.
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Servicing Rights: Any and all of the following: (a) any and all rights
to service the Mortgage Loans; (b) any payments to or monies received by the
Interim Servicer for servicing the Mortgage Loans; (c) any late fees, penalties
or similar payments with respect to the Mortgage Loans; (d) all agreements or
documents creating, defining or evidencing any such servicing rights to the
extent they relate to such servicing rights and all rights of the Interim
Servicer thereunder; (e) Escrow Payments or other similar payments with respect
to the Mortgage Loans and any amounts actually collected by the Interim Servicer
with respect thereto; (f) all accounts and other rights to payment related to
any of the property described in this paragraph; and (g) any and all documents,
files, records, servicing files, servicing documents, servicing records, data
tapes, computer records, or other information pertaining to the Mortgage Loans
or pertaining to the past, present or prospective servicing of the Mortgage
Loans.
Sponsor: The sponsor, as such term is defined in Regulation AB, with
respect to any Securitization Transaction.
Standard & Poor's: Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies Inc., and its successors in interest.
Standard & Poor's Glossary: The Standard & Poor's LEVELS(R) Glossary,
as may be in effect from time to time.
Stated Principal Balance: As to each Mortgage Loan on any date of
determination, (i) the principal balance of such Mortgage Loan at the related
Cut-off Date after giving effect to payments of principal due on or before such
date, to the extent actually received, minus (ii) all amounts previously
distributed to the Purchaser with respect to the related Mortgage Loan
representing payments or recoveries of principal on such Mortgage Loan.
Static Pool Information: Static pool information as described in Item
1105(a)(1) (3) and 1105(c) of Regulation AB.
Successor Servicer: Any servicer of one or more Mortgage Loans
designated by the Purchaser as being entitled to the benefits of the
indemnifications set forth in Sections 9.03 and 14.01.
Third Party Originator: Each Person, other than a Qualified
Correspondent, that originated Mortgage Loans acquired by the Seller.
Transfer Date: The date on which the Purchaser, or its designee, shall
receive the transfer of servicing responsibilities and begin to perform the
servicing of the Mortgage Loans with respect to the related Mortgage Loan
Package, and the Interim Servicer shall cease all servicing responsibilities.
Such date shall occur on the day indicated by the Purchaser to the Interim
Servicer in accordance with the Interim Servicing Agreement.
Underwriting Guidelines: With respect to each Mortgage Loan Package,
the underwriting guidelines of the Seller, a copy of which shall be attached as
an Exhibit to the related Assignment and Conveyance Agreement.
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VA: The Department of Veterans Affairs, an agency of the United States
of America, or any successor thereto including the Administrator of Veterans
Affairs.
Whole Loan Transfer: Any sale or transfer of some or all of the
Mortgage Loans, other than a Securitization Transaction.
SECTION 2. Agreement to Purchase.
The Seller agrees to sell from time to time, and the Purchaser agrees
to purchase from time to time, Mortgage Loans having an aggregate principal
balance on the related Cut-off Date in an amount as set forth in the related
Purchase Price and Terms Agreement, or in such other amount as agreed by the
Purchaser and the Seller as evidenced by the actual aggregate principal balance
of the Mortgage Loans accepted by the Purchaser on each Closing Date.
SECTION 3. Mortgage Schedules.
The Seller from time to time shall provide the Purchaser with certain
information constituting a preliminary listing of the Mortgage Loans to be
purchased on each Closing Date in accordance with the related Purchase Price and
Terms Agreement and this Agreement (each, a "Preliminary Mortgage Schedule").
The Seller shall deliver the Mortgage Loan Schedule and the related
Points Schedule for the Mortgage Loans to be purchased on a particular Closing
Date to the Purchaser at least two (2) Business Days prior to the related
Closing Date or such later date on which the Purchaser has identified to the
Seller the final list of Mortgage Loans the Purchaser desires to purchase.
SECTION 4. Purchase Price.
The Purchase Price for the Mortgage Loans shall be equal to (a) the
Purchase Price Percentage multiplied by the Cut-off Date Balance, plus (b)
accrued and unpaid interest on such principal balance at the weighted average
Mortgage Interest Rate (net of the Servicing Fee) of those Mortgage Loans from
the related Cut-off Date through the day prior to the related Closing Date,
inclusive. For purposes hereof, "Cut-off Date Balance" means the aggregate
principal balance, as of the related Cut-off Date, of the Mortgage Loans listed
on the related Mortgage Loan Schedule, after application of scheduled payments
of principal due on or before the related Cut-off Date, to the extent such
payments were actually received, together with any unscheduled principal
payments collected prior to the Cut-off Date; provided, however, that payments
of scheduled principal and interest paid prior to the Cut-off Date, but to be
applied on a due date beyond the related Cut-off Date, shall not be applied to
the principal balance as of the related Cut-off Date. If so provided in the
related Purchase Price and Terms Agreement, portions of the Mortgage Loans shall
be priced separately. The Purchase Price as so determined shall be paid to the
Seller on the related Closing Date by wire transfer of immediately available
funds to an account or accounts designated by the Seller in writing.
The Purchaser shall be entitled to (l) all principal paid after the
related Cut-off Date, (2) all other recoveries of principal collected on or
after the related Cut-off Date, and (3) all payments of interest on the Mortgage
Loans net of applicable Servicing Fees (minus that
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portion of any such payment which is allocable to the period prior to the
related Cut-off Date). The outstanding principal balance of each Mortgage Loan
as of the related Cut-off Date is determined after application of payments of
principal due on or before the related Cut-off Date, to the extent actually
collected, together with any unscheduled principal prepayments collected prior
to the Cut-off Date; provided, however, that payments of scheduled principal and
interest paid prior to the Cut-off Date, but to be applied on a due date beyond
the related Cut-off Date shall not be applied to the principal balance as of the
related Cut-off Date. Such prepaid amounts shall be the property of the
Purchaser. The Seller 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 Seller to the Purchaser.
SECTION 5. Examination of Mortgage Files.
At least seven (7) Business Days prior to the related Closing Date,
the Seller shall either deliver to the Purchaser or its designee in escrow, for
examination with respect to each Mortgage Loan to be purchased, or make
available to the Purchaser for examination at such other location as shall
otherwise be acceptable to the Purchaser and Seller, copies or originals of the
credit and servicing files, including the Mortgage File (collectively, the
"Credit Files"). Such examination of the Credit Files may be made by the
Purchaser or its designee at any reasonable time before or after the related
Closing Date. If the Purchaser makes such examination prior to the related
Closing Date and determines, in its sole discretion, that any Mortgage Loans are
unacceptable under the terms of the related Purchase Price and Terms Agreement,
such Mortgage Loans shall be deleted from the related Mortgage Loan Schedule,
and may be replaced by a Qualified Substitute Mortgage Loan (or Loans)
acceptable to the Purchaser. The Purchaser may, at its option and without notice
to the Seller, purchase some or all of the Mortgage Loans without conducting any
partial or complete examination. The fact that the Purchaser or its designee has
conducted or has failed to conduct any partial or complete examination of the
Mortgage Files or the Credit Files shall not impair in any way the Purchaser's
(or any of its successor's) rights to demand repurchase, substitution or other
remedy as provided in this Agreement. Notwithstanding the foregoing, the
Purchaser may not demand a repurchase or other relief or remedy due to the
failure of a Mortgage Loan to comply with the Underwriting Guidelines if the
Purchaser or its designee has previously examined such Mortgage Loan and certain
exceptions to the Underwriting Guidelines were noted and accepted by the
Purchaser prior to the purchase of such Mortgage Loan. In the event that the
Seller fails to deliver the Credit Files with respect to any Mortgage Loan, the
Seller shall, upon the request of the Purchaser, repurchase such Mortgage Loan
at the price and in the manner specified in Subsection 9.03.
SECTION 6. Conveyance from Seller to Purchaser.
Subsection 6.01. Conveyance of Mortgage Loans; Possession of Servicing
Files.
The Seller, simultaneously with the delivery of the Mortgage Loan
Schedule with respect to the related Mortgage Loan Package to be purchased on
each Closing Date, shall execute and deliver an Assignment and Conveyance
Agreement in the form attached hereto as Exhibit H (the "Assignment and
Conveyance Agreement"). The Seller shall cause the Servicing File retained by
the Interim Servicer pursuant to this Agreement to be appropriately identified
in
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the Seller's computer system and/or books and records, as appropriate, to
clearly reflect the sale of the related Mortgage Loan to the Purchaser. The
Seller shall cause the Interim Servicer to release from its custody the contents
of any Servicing File retained by it only in accordance with this Agreement or
the Interim Servicing Agreement, except when such release is required in
connection with a repurchase of any such Mortgage Loan pursuant to Subsection
9.03.
Subsection 6.02. Books and Records.
Record title to each Mortgage as of the related Closing Date shall be
in the name of the Seller or MERS. Notwithstanding the foregoing, each Mortgage
and related Mortgage Note shall be beneficially possessed solely by the
Purchaser or the appropriate designee of the Purchaser, as the case may be. All
rights arising out of the Mortgage Loans including, but not limited to, all
funds received by the Seller or the Interim Servicer after the related Cut-off
Date on or in connection with a Mortgage Loan shall be vested in the Purchaser
or one or more designees of the Purchaser; provided, however, that all funds
received on or in connection with a Mortgage Loan shall be received and held by
the Seller or the Interim Servicer in trust for the benefit of the Purchaser or
the appropriate designee of the Purchaser, as the case may be, as the owner of
the Mortgage Loans pursuant to the terms of this Agreement.
The sale of each Mortgage Loan shall be reflected on the Seller's
balance sheet and other financial statements as a sale of assets by the Seller.
The Seller shall or shall cause the Interim Servicer to 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 Seller shall or shall
cause the Interim Servicer to maintain in its possession, available for
inspection by the Purchaser, and shall deliver to the Purchaser upon demand,
evidence of compliance with all federal, state and local laws, rules and
regulations, and applicable requirements of Xxxxxx Xxx or Xxxxxxx Mac, including
but not limited to documentation as to the method used in determining the
applicability of the provisions of the National Flood Insurance Act of 1968, as
amended, to the Mortgaged Property, documentation evidencing insurance coverage
and periodic inspection reports, as required by Accepted Servicing Practices. To
the extent that original documents are not required for purposes of realization
of Liquidation Proceeds or Insurance Proceeds, documents maintained by the
Seller or the Interim Servicer may be in the form of microfilm or microfiche so
long as the Seller or the Interim Servicer complies with Accepted Servicing
Practices.
Subsection 6.03. Delivery of Mortgage Loan Documents.
The Seller shall deliver and release to the Custodian no later than
five (5) Business Days prior to the related Closing Date those Mortgage Loan
Documents set forth on Exhibit A hereto with respect to each Mortgage Loan set
forth on the related Mortgage Loan Schedule.
The Custodian shall certify its receipt of all such Mortgage Loan
Documents required to be delivered pursuant to the Custodial Agreement for the
related Closing Date, as evidenced by the Certification and Trust Receipt of the
Custodian in the form annexed to the
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Custodial Agreement. The Purchaser shall pay all fees and expenses of the
Custodian from and after the Closing Date.
The Seller shall or shall cause the Interim Servicer to forward to the
Custodian, or to such other Person as the Purchaser shall designate in writing,
original documents evidencing an assumption, modification, consolidation or
extension of any Mortgage Loan entered into in accordance with this Agreement
within two (2) weeks of their execution, provided, however, that the Seller
shall provide the Custodian, or to such other Person as the Purchaser shall
designate in writing, with a certified true copy of any such document submitted
for recordation within two (2) weeks of its execution, and shall promptly
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 ninety (90) days of its submission for
recordation.
In the event any document required to be delivered to the Custodian
pursuant to the previous paragraph, including an original or copy of any
document submitted for recordation to the appropriate public recording office,
is not so delivered to the Custodian, or to such other Person as the Purchaser
shall designate in writing, within ninety (90) days following the Closing Date
(other than with respect to the Assignments of Mortgage which shall be delivered
to the Custodian in blank and recorded subsequently by the Purchaser or its
designee), and in the event that the Seller does not cure such failure within
thirty (30) days of discovery or receipt of written notification of such failure
from the Purchaser, the related Mortgage Loan shall, upon the request of the
Purchaser, be repurchased by the Seller at the price and in the manner specified
in Subsection 9.03. The foregoing repurchase obligation shall not apply in the
event that the Seller cannot deliver such original or copy of any document
submitted for recordation to the appropriate public recording office within the
specified period due to a delay caused by the recording office in the applicable
jurisdiction, provided that (i) the Seller shall deliver a recording receipt of
such recording office or, if such recording receipt is not available, an
officer's certificate of a servicing officer of the Seller, confirming that such
documents have been accepted for recording (upon request of the Purchaser and
delivery by the Purchaser to the Seller of a schedule of the related Mortgage
Loans, the Seller shall reissue and deliver to the Purchaser or its designee
said officer's certificate relating to the related Mortgage Loans), and (ii)
such document is delivered within twelve (12) months of the related Closing
Date.
The Seller shall pay all initial recording fees, if any, for the
assignments of mortgage and any other fees or costs for a one-time transfer of
all original documents to the Custodian or, upon written request of the
Purchaser, to the Purchaser or the Purchaser's designee. The Purchaser, or the
Purchaser's designee, shall be responsible for recording any Assignments of
Mortgage and shall be reimbursed by the Seller for the costs associated
therewith pursuant to the preceding sentence.
Subsection 6.04. Quality Control Procedures.
The Seller shall, or shall cause the Interim Servicer to, have an
internal quality control program that verifies in a manner consistent with
accepted industry procedures, on a regular basis, the existence and accuracy of
the legal documents, credit documents, property appraisals, and underwriting
decisions. The program shall include evaluating and monitoring the
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overall quality of the Seller's loan production and the servicing activities of
the Interim Servicer. The program is to ensure that the Mortgage Loans are
originated and serviced in accordance with Accepted Servicing Practices and the
Underwriting Guidelines; guard against dishonest, fraudulent, or negligent acts;
and guard against errors and omissions by officers, employees, or other
authorized persons.
Subsection 6.05. MERS Designated Mortgage Loans.
With respect to each MERS Designated Mortgage Loan, the Seller shall,
on or prior to the related Closing Date, designate the Purchaser as the Investor
and the Custodian as custodian, and, no later than one Business Day following
the related Closing Date, no Person shall be listed as Interim Funder on the
MERS System. In addition, no later than one Business Day following the related
Closing Date, Seller shall provide the Custodian and the Purchaser with a MERS
Report listing the Purchaser as the Investor, the Custodian as custodian and no
Person as Interim Funder with respect to each MERS Designated Mortgage Loan.
SECTION 7. Servicing of the Mortgage Loans.
The Mortgage Loans have been sold by the Seller to the Purchaser on a
servicing released basis. Subject to, and upon the terms and conditions of this
Agreement and the Interim Servicing Agreement (with respect to each Mortgage
Loan, for an interim period, as specified therein), the Seller hereby sells,
transfers, assigns, conveys and delivers to the Purchaser the Servicing Rights.
The Purchaser shall retain the Interim Servicer as contract servicer
of the Mortgage Loans for an interim period pursuant to and in accordance with
the terms and conditions contained in the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Except as set forth in the Interim Servicing Agreement, the Interim Servicer
shall service the Mortgage Loans on an "actual/actual" basis and otherwise in
material compliance with Accepted Servicing Practices. The Purchaser and Seller
shall cause the Interim Servicer to execute the Interim Servicing Agreement on
the initial Closing Date.
Pursuant to the Interim Servicing Agreement (with respect to each
Mortgage Loan, for an interim period, as specified therein), the Interim
Servicer shall begin servicing the Mortgage Loans on behalf of the Purchaser and
shall be entitled to a Servicing Fee with respect to such Mortgage Loans until
the applicable Transfer Date. The Interim Servicer shall conduct such servicing
in accordance with the Interim Servicing Agreement.
SECTION 8. Transfer of Servicing.
On the applicable Transfer Date, the Purchaser, or its designee, shall
assume all servicing responsibilities related to, and the Seller shall cause the
Interim Servicer to cease all servicing responsibilities related to, the related
Mortgage Loans subject to such Transfer Date. The Transfer Date shall be the
date determined in accordance with Section 6.02 of the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
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On or prior to the applicable Transfer Date, or such later date
provided for below, the Seller shall, at its sole cost and expense, take such
steps as may be necessary or appropriate to effectuate and evidence the transfer
of the servicing of the related Mortgage Loans to the Purchaser, or its
designee, including but not limited to the following:
(a) Notice to Mortgagors. The Seller shall cause the Interim Servicer
to mail to the Mortgagor of each related Mortgage Loan a letter advising such
Mortgagor of the transfer of the servicing of the related Mortgage Loan to the
Purchaser, or its designee, in accordance with the Xxxxxxxx Xxxxxxxx National
Affordable Housing Act of 1990; provided, however, the content and format of the
letter shall have the prior approval of the Purchaser, such approval not to be
unreasonably withheld. The Seller shall cause the Interim Servicer to provide
the Purchaser with copies of all such related notices within five Business Days
following the related Transfer Date.
(b) Notice to Taxing Authorities and Insurance Companies. The Seller
shall cause the Interim Servicer to transmit to the applicable taxing
authorities and insurance companies (including primary mortgage insurance policy
insurers, if applicable) and/or agents, notification of the transfer of the
servicing to the Purchaser, or its designee, and instructions to deliver all
notices, tax bills and insurance statements, as the case may be, to the
Purchaser from and after the Transfer Date. The Seller shall cause the Interim
Servicer to provide the Purchaser with copies of all such notices within five
Business Days following the related Transfer Date.
(c) Delivery of Servicing Records. Within five Business Days following
the related Transfer Date, the Seller shall cause the Interim Servicer to
forward to the Purchaser, or its designee, all servicing records and the
Servicing File in the Interim Servicer's possession relating to each related
Mortgage Loan including the information enumerated in the Interim Servicing
Agreement (with respect to each such Mortgage Loan, for an interim period, as
specified therein).
(d) Escrow Payments. Within five Business Days following the related
Transfer Date, the Seller shall cause the Interim Servicer to provide the
Purchaser, or its designee, with immediately available funds by wire transfer in
the amount of the net Escrow Payments and suspense balances and all loss draft
balances associated with the related Mortgage Loans. Within five Business Days
following the related Transfer Date, the Seller shall cause the Interim Servicer
to provide the Purchaser with an accounting statement, in electronic format
acceptable to the Purchaser in its sole discretion, of Escrow Payments and
suspense balances and loss draft balances sufficient to enable the Purchaser to
reconcile the amount of such payment with the accounts of the Mortgage Loans.
Additionally, the Seller shall, within five Business Days following the related
Transfer Date, cause the Interim Servicer to wire transfer to the Purchaser the
amount of any agency, trustee or prepaid Mortgage Loan payments and all other
similar amounts held by the Interim Servicer.
(e) Payoffs and Assumptions. Within five Business Days following the
related Transfer Date, the Seller shall cause the Interim Servicer to provide to
the Purchaser, or its designee, copies of all assumption and payoff statements
generated by the Interim Servicer on the related Mortgage Loans from the related
Cut-off Date to the Transfer Date.
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(f) Mortgage Payments Received Prior to Transfer Date. Prior to the
Transfer Date all payments received by the Interim Servicer or the Seller on
each related Mortgage Loan shall be properly applied by the Seller to the
account of the particular Mortgagor.
(g) Mortgage Payments Received after Transfer Date. The amount of any
related Monthly Payments received by the Seller after the Transfer Date shall be
forwarded to the Purchaser by overnight mail on the date of receipt. The Seller
shall notify the Purchaser of the particulars of the payment, which notification
requirement shall be satisfied if the Seller forwards with its payment
sufficient information to permit appropriate processing of the payment by the
Purchaser. The Seller shall assume full responsibility for the necessary and
appropriate legal application of such Monthly Payments received by the Seller
after the Transfer Date with respect to related Mortgage Loans then in
foreclosure or bankruptcy; provided, for purposes of this Agreement, necessary
and appropriate legal application of such Monthly Payments shall include, but
not be limited to, endorsement of a Monthly Payment to the Purchaser with the
particulars of the payment such as the account number, dollar amount, date
received and any special Mortgagor application instructions and the Seller shall
cause the Interim Servicer to comply with the foregoing requirements with
respect to all Monthly Payments received by the Interim Servicer after the
Transfer Date.
(h) Misapplied Payments. Misapplied payments shall be processed as
follows:
(i) All parties shall cooperate in correcting misapplication errors;
(ii) The party receiving notice of a misapplied payment occurring
prior to the applicable Transfer Date and discovered after the Transfer
Date shall immediately notify the other party;
(iii) If a misapplied payment which occurred prior to the Transfer
Date cannot be identified and said misapplied payment has resulted in a
shortage in a Custodial Account or Escrow Account, the Seller shall be
liable for the amount of such shortage. The Seller shall reimburse the
Purchaser for the amount of such shortage within thirty (30) days after
receipt of written demand therefor from the Purchaser;
(iv) If a misapplied payment which occurred prior to the Transfer Date
has created an improper Purchase Price as the result of an inaccurate
outstanding principal balance, a check shall be issued to the party shorted
by the improper payment application within five (5) Business Days after
notice thereof by the other party; and
(v) Any check issued under the provisions of this Section 8(h) shall
be accompanied by a statement indicating the corresponding Seller and/or
the Purchaser Mortgage Loan identification number and an explanation of the
allocation of any such payments.
(i) Books and Records. On the Transfer Date, the books, records and
accounts of the Seller with respect to the related Mortgage Loans shall be in
accordance with all applicable Purchaser requirements as set forth in this
Agreement.
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(j) Reconciliation. The Seller shall, on or before the Transfer Date,
reconcile principal balances and make any monetary adjustments required by the
Purchaser in accordance with this Agreement. Any such monetary adjustments will
be transferred between the Seller and the Purchaser as appropriate.
(k) IRS Forms. The Seller shall or shall cause the Interim Servicer to
file all IRS forms 1099, 1099A, 1098 or 1041 and K-1 which are required to be
filed on or before the Transfer Date in relation to the servicing and ownership
of the related Mortgage Loans. The Seller shall provide copies of such forms to
the Purchaser upon request and shall reimburse the Purchaser for any costs or
penalties incurred by the Purchaser due to the Seller's failure to comply with
this paragraph.
SECTION 9. Representations, Warranties and Covenants of the Seller;
Remedies for Breach.
Subsection 9.01. Representations and Warranties Regarding the
Seller.
The Seller represents, warrants and covenants to the Purchaser that as
of the date hereof and as of each Closing Date:
(a) Due Organization and Authority. The Seller is a corporation duly
organized, validly existing and in good standing under the laws of the State of
California 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 wherein
it owns or leases any material properties or 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 Seller, and in any event the
Seller 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 and the
Interim Servicing Agreement; the Seller has the full corporate power, authority
and legal right to hold, transfer and convey the Mortgage Loans and to execute
and deliver this Agreement and to perform its obligations hereunder and
thereunder; the execution, delivery and performance of this Agreement (including
all instruments of transfer to be delivered pursuant to this Agreement) by the
Seller and the consummation of the transactions contemplated hereby and thereby
have been duly and validly authorized; this Agreement and all agreements
contemplated hereby have been duly executed and delivered and constitute the
valid, legal, binding and enforceable obligations of the Seller, regardless of
whether such enforcement is sought in a proceeding in equity or at law, subject
to bankruptcy, insolvency, and similar laws affecting the rights of creditors
generally and to general principles of equity; and all requisite corporate or
other action has been taken by the Seller to make this Agreement and all
agreements contemplated hereby valid and binding upon the Seller in accordance
with their terms;
(b) Ordinary Course of Business. The consummation of the transactions
contemplated by this Agreement are in the ordinary course of business of the
Seller, and the transfer, assignment and conveyance of the Mortgage Notes and
the Mortgages by the Seller pursuant to this Agreement are not subject to the
bulk transfer or any similar statutory provisions in effect in any applicable
jurisdiction;
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(c) No Conflicts. Neither the execution and delivery of this
Agreement, the acquisition or origination of the Mortgage Loans by the Seller,
the sale of the Mortgage Loans to the Purchaser, the consummation of the
transactions contemplated hereby and thereby, 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, conditions or provisions of the
Seller's charter, by-laws or other organizational documents or any legal
restriction or any agreement or instrument to which the Seller is now a party or
by which it is bound, or constitute a default or result in an acceleration under
any of the foregoing, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Seller or its property is subject, or
result in the creation or imposition of any lien, charge or encumbrance that
would have an adverse effect upon any of its properties pursuant to the terms of
any mortgage, contract, deed of trust or other instrument, or impair the ability
of the Purchaser to realize on the Mortgage Loans, impair the value of the
Mortgage Loans, or impair the ability of the Purchaser to realize the full
amount of any insurance benefits accruing pursuant to this Agreement;
(d) Ability to Service. The Interim Servicer has the facilities,
procedures, and experienced personnel necessary for the sound servicing of
mortgage loans of the same type as the Mortgage Loans. The Interim Servicer is
duly qualified, licensed, registered and otherwise authorized under all
applicable federal, state and local laws, and regulations, if applicable, meets
the minimum capital requirements set forth by the OTS, the OCC or the FDIC, and
is in good standing to enforce, originate, sell mortgage loans to, and service
mortgage loans in each jurisdiction wherein the Mortgaged Properties are
located;
(e) Reasonable Servicing Fee. The Seller 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 Interim
Servicer, for accounting and tax purposes, as compensation for the servicing and
administration of the Mortgage Loans pursuant to this Agreement and the Interim
Servicing Agreement;
(f) Ability to Perform; Solvency. The Seller 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 Seller is solvent and the sale
of the Mortgage Loans will not cause the Seller to become insolvent. The sale of
the Mortgage Loans is not undertaken with the intent to hinder, delay or defraud
any of Seller's creditors;
(g) No Litigation Pending. Except as disclosed in filings with the
Securities Exchange Commission by the Seller or its Affiliates, there is no
action, suit, proceeding or investigation pending or threatened against the
Seller, before any court, administrative agency or other tribunal asserting the
invalidity of this Agreement, seeking to prevent the consummation of any of the
transactions contemplated by this Agreement or 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 Seller, or in any
material impairment of the right or ability of the Seller to carry on its
business substantially as now conducted, or in any material liability on the
part of the Seller, or which would draw into question the validity of this
Agreement or the Mortgage Loans or of any action taken or to be taken in
connection with the obligations of the Seller contemplated herein, or which
would be likely to impair the ability of the Seller to perform under the terms
of this Agreement;
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(h) No Consent Required. No consent, approval, authorization or order
of, or registration or filing with, or notice to any court or governmental
agency or body including HUD, the FHA or the Department of Veterans Affairs is
required for the execution, delivery and performance by the Seller of or
compliance by the Seller with this Agreement or the Mortgage Loans, the delivery
of a portion of the Mortgage Files to the Custodian or the sale of the Mortgage
Loans or the consummation of the transactions contemplated by this Agreement, or
if required, such consent, approval, authorization or order of, or registration
or filing with, or notice has been obtained prior to the need therefore;
(i) Selection Process. The Mortgage Loans were selected from among the
outstanding one- to four-family mortgage loans in the Seller's portfolio at the
related Closing Date as to which the representations and warranties set forth in
Subsection 9.02 could be made and such selection was not made on behalf of the
Seller in a manner so as to affect adversely the interests of the Purchaser;
(j) Mortgage Loan Package Characteristics. The characteristics of the
related Mortgage Loan Package are as set forth on the description of the pool
characteristics for the applicable Mortgage Loan Package delivered pursuant to
Section 11 on the related Closing Date in the form attached as Exhibit B to each
related Assignment and Conveyance Agreement;
(k) No Untrue Information. Neither this Agreement nor any information,
statement, tape, diskette, report, form, or other document furnished or to be
furnished by Seller pursuant to this Agreement or any Reconstitution Agreement
or in connection with the transactions contemplated hereby (including any
Securitization Transaction or Whole Loan Transfer) contains or will contain any
untrue statement of material fact or omits or will omit to state a material fact
necessary to make the statements contained herein or therein not misleading;
(l) Financial Statements. Any financial statements delivered pursuant
to Section 15 fairly present the pertinent results of operations and changes in
financial position for each of such periods and the financial position at the
end of each such period of the Seller and its subsidiaries and have been
prepared in accordance with generally accepted accounting principles of the
United States consistently applied throughout the periods involved, except as
set forth in the notes thereto. Except as disclosed in filings with the
Securities Exchange Commission by the Seller or its Affiliates, there has been
no change in the business, operations, financial condition, properties or assets
of the Seller since the date of the Seller's financial statements most recently
delivered to Purchaser that would have an adverse effect on its ability to
perform its obligations under this Agreement;
(m) No Brokers. The Seller 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;
(n) Sale Treatment. The Seller has been advised by its independent
certified public accountants that under generally accepted accounting principles
the transfer of the Mortgage Loans may be treated as a sale on the books and
records of the Seller and the Seller has determined that the disposition of the
Mortgage Loans pursuant to this Agreement will be afforded sale treatment for
tax and accounting purposes;
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(o) Reasonable Purchase Price. The consideration received by the
Seller upon the sale of the Mortgage Loans under this Agreement constitutes fair
consideration and reasonably equivalent value for the Mortgage Loans;
(p) Owner of Record. The Seller is the owner of record of each
Mortgage and the indebtedness evidenced by each Mortgage Note (other than for
each MERS Designated Mortgage Loan), and upon the sale of the Mortgage Loans to
the Purchaser, the Seller will retain the Mortgage Files with respect thereto in
trust only for the purpose of servicing and supervising the servicing of each
Mortgage Loan;
(q) Seller's Origination. The Seller's decision to originate any
mortgage loan or to deny any mortgage loan application is an independent
decision based upon Seller's underwriting guidelines, and is in no way made as a
result of Purchaser's decision to purchase, or not to purchase, or the price
Purchaser may offer to pay for, any such mortgage loan, if originated;
(r) Compliance with Anti-Money Laundering Laws. The Seller has
complied with all applicable anti-money laundering laws, regulations and
executive orders, including without limitation the USA Patriot Act of 2001
(collectively, the "Anti-Money Laundering Laws");
(s) Delivery to the Custodian. The Mortgage Note, the Mortgage, any
Assignment of Mortgage and any other documents required to be delivered with
respect to each Mortgage Loan pursuant to this Agreement shall be delivered to
the Custodian or as otherwise instructed by the Purchaser all in compliance with
the specific requirements of this Agreement. With respect to each Mortgage Loan,
the Seller will be in possession of a complete Mortgage File in compliance with
Exhibit A hereto, except for such documents as will be delivered to the
Custodian or as otherwise instructed by the Purchaser; and
(t) Credit Reporting. The Seller, for so long as it is the Interim
Servicer for each Mortgage Loan will 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.
Subsection 9.02. Representations and Warranties Regarding Individual
Mortgage Loans.
The Seller hereby represents and warrants to the Purchaser that, as to
each Mortgage Loan, as of the related Closing Date for such Mortgage Loan:
(a) Mortgage Loans as Described. The information set forth in the
Mortgage Loan Schedule and in the Points Schedule is complete, true and correct;
(b) Payments Current. As of the Closing Date, no payment required
under the Mortgage Loan is thirty (30) days or more delinquent nor has any
payment under the Mortgage Loan been thirty (30) days or more delinquent at any
time since the origination of the Mortgage
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Loan. The first Monthly Payment due to the Purchaser shall be made with respect
to the Mortgage Loan within the calendar month in which its Due Date occurs and
prior to the Due Date next occurring for such Mortgage Loan;
(c) No Outstanding Charges. There are no defaults in complying with
the terms of the Mortgage securing the Mortgage Loan, and all taxes,
governmental assessments, insurance premiums, water, sewer and municipal
charges, leasehold payments or ground rents which previously became due and
owing have been paid, or an escrow of funds has been established in an amount
sufficient to pay for every such item which remains unpaid and which has been
assessed but is not yet due and payable. Except for (A) payments in the nature
of escrow payments and (B) interest accruing from the date of the Mortgage Note
or date of disbursement of the Mortgage Loan proceeds, whichever is earlier to
the day which precedes by one (1) month the Due Date of the first installment of
principal and interest, including, without limitation, taxes and insurance
payments, the Seller has not advanced funds, or induced, solicited or knowingly
received any advance of funds by a party other than the Mortgagor, directly or
indirectly, for the payment of any amount required under the Mortgage Loan;
(d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any respect,
from the date of origination 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 Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. 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, and which assumption agreement is part of the Mortgage Loan File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the Mortgage Loan
Schedule;
(e) 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, and no Mortgagor
was a debtor in any state or federal bankruptcy or insolvency proceeding at, or
subsequent to, the time the Mortgage Loan was funded;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are customary in the area where the Mortgaged Property
is located, as well as all additional requirements set forth in Section 2.10 of
the Interim Servicing Agreement. If required by the National Flood Insurance Act
of 1968, as amended, each Mortgage Loan is covered by a flood insurance policy
meeting the requirements of the current guidelines of the Federal Insurance
Administration in effect, as well as all additional requirements set forth in
Section 2.10 of the Interim Servicing Agreement.
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All individual insurance policies contain a standard mortgagee clause naming the
Seller and its successors and assigns as mortgagee, and all premiums currently
due thereon have been paid and such policies may not be reduced, terminated or
cancelled without thirty (30) days' prior written notice to the mortgagee. The
Mortgage obligates the Mortgagor thereunder to maintain the hazard insurance
policy at the Mortgagor's cost and expense, and on the Mortgagor's failure to do
so, authorizes the holder of the Mortgage to obtain and maintain such insurance
at such Mortgagor's cost and expense, and to seek reimbursement therefor from
the Mortgagor. Where required by state law or regulation, the Mortgagor has been
given an opportunity to choose the carrier of the required hazard insurance,
provided the policy is not a "master" or "blanket" hazard insurance policy
covering a condominium, or any hazard insurance policy covering the common
facilities of a planned unit development. The hazard insurance policy is the
valid and binding obligation of the insurer, is in full force and effect, and
will be in full force and effect and inure to the benefit of the Purchaser upon
the consummation of the purchase transactions contemplated by this Agreement.
The Seller has not engaged in, and has no knowledge of the Mortgagor's or any
servicer's having engaged in, any act or omission which would impair the
coverage of any such policy, the benefits of the endorsement provided for
herein, or the validity and binding effect of such policy, including, without
limitation, no unlawful fee, commission, kickback or other unlawful compensation
or value of any kind has been or will be received, retained or realized by any
attorney, firm or other person or entity, and no such unlawful items have been
received, retained or realized by the Seller;
(g) Compliance with Applicable Laws. (i) 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,
predatory, abusive and fair lending, equal credit opportunity and disclosure
laws applicable to the Mortgage Loan, including, without limitation, any
provisions relating to prepayment penalties, have been complied with, (ii) the
consummation of the transactions contemplated hereby will not involve the
violation of any such laws or regulations, and (iii) the Seller 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.
Clause (i) of this representation and warranty is a Deemed Material Breach
Representation;
(h) No Satisfaction of Mortgage. The Mortgage has not been satisfied,
canceled, subordinated (except to a senior mortgage in the case of a Second Lien
Loan) 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 release, cancellation,
subordination or rescission. The Seller has not waived the performance by the
Mortgagor of any action, if the Mortgagor's failure to perform such action would
cause the Mortgage Loan to be in default, nor has the Seller waived any default
resulting from any action or inaction by the Mortgagor;
(i) Location and Type of Mortgaged Property. The Mortgaged Property is
a fee simple property located in the state identified in the related Mortgage
Loan Schedule, except that with respect to real property located in
jurisdictions in which the use of leasehold estates for residential properties
is a widely-accepted practice, the Mortgaged Property may be a leasehold estate,
and consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit
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in a condominium project, or an individual unit in a planned unit development;
provided, however, that no residence or dwelling is a mobile home and any
condominium unit or planned unit development shall not fall within any of the
"Ineligible Projects" of part XII, Section 102 of the Xxxxxx Xxx Selling Guide
and shall conform with the Underwriting Guidelines. In the case of any Mortgaged
Properties that are manufactured homes (a "Manufactured Home Mortgage Loans"),
(i) such Manufactured Home Mortgage Loan conforms with the applicable Xxxxxx Mae
or Xxxxxxx Mac requirements regarding mortgage loans related to manufactured
dwellings, (ii) the related manufactured dwelling is permanently affixed to the
land, (iii) the related manufactured dwelling and the related land are subject
to a Mortgage properly filed in the appropriate public recording office and
naming Seller as mortgagee, (iv) the applicable laws of the jurisdiction in
which the related Mortgaged Property is located will deem the manufactured
dwelling located on such Mortgaged Property to be a part of the real property on
which such dwelling is located, (v) as of the origination date of the related
Manufactured Home Mortgage Loan, the related manufactured housing unit that
secures such Mortgage Loan either (x) was the principal residence of the related
Mortgagor or (y) was classified as real property under applicable state law, and
(vi) such Manufactured Home Mortgage Loan is (x) a qualified mortgage under
Section 860G(a)(3) of the Internal Revenue Code of 1986, as amended, and (y)
secured by manufactured housing treated as a single family residence under
Section 25(e)(10) of the Code. As of the date of origination, no portion of the
Mortgaged Property was used for commercial purposes, and since the date of
origination, no portion of the Mortgaged Property has been used for commercial
purposes; provided, that Mortgaged Properties which contain a home office shall
not be considered as being used for commercial purposes as long as the Mortgaged
Property has not been altered for commercial purposes and is not storing any
chemicals or raw materials other than those commonly used for homeowner repair,
maintenance and/or household purposes. Clause (v) of this representation and
warranty is a Deemed Material Breach Representation;
(j) Valid First and Second Lien. Each Mortgage is a valid and
subsisting first lien, with respect to First Lien Loans, or second lien, with
respect to Second Lien Loans, of record on a single parcel of real estate
constituting the Mortgaged Property, including all buildings and improvements 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,
subject in all cases to the exceptions to title set forth in the title insurance
policy with respect to the related Mortgage Loan, which exceptions are generally
acceptable to prudent mortgage lending companies, and such other exceptions to
which similar properties are commonly subject and which do not individually, or
in the aggregate, materially and adversely affect the benefits of the security
intended to be provided by such Mortgage. In no event shall any Mortgage Loan be
in a lien position more junior than a second lien. The lien of the Mortgage is
subject only to:
(1) with respect to Second Lien Loans, the lien of the first
mortgage on the Mortgaged Property;
(2) the lien of current real property taxes and assessments
not yet due and payable;
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(3) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date
of recording acceptable to prudent mortgage lending institutions
generally and specifically referred to in the lender's title
insurance policy delivered to the originator of the Mortgage Loan
and (a) specifically referred to or otherwise considered in the
appraisal made for the originator of the Mortgage Loan or (b)
which do not adversely affect the Appraised Value of the
Mortgaged Property set forth in such appraisal; and
(4) 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, enforceable (subject to bankruptcy, insolvency and similar laws
affecting the rights of creditors and general principles of equity) and
perfected (A) first lien and first priority security interest with respect to
each First Lien Loan, or (B) second lien and second priority security interest
with respect to each Second Lien Loan, in either case, on the property described
therein and Seller has full right to sell and assign the same to Purchaser. With
respect to each Second Lien Loan, the Mortgaged Property was not, as of the date
of origination of such Second Lien Loan, subject to a mortgage, deed of trust,
deed to secure debt or other security instrument creating a lien subordinate to
the lien of the Mortgage;
(k) Validity of Mortgage Documents. The Mortgage Note and the Mortgage
and any other agreement executed and delivered by a Mortgagor or guarantor, if
applicable, in connection with a Mortgage Loan are genuine, and each is the
legal, valid and binding obligation of the maker thereof enforceable in
accordance with its terms, subject to bankruptcy, insolvency and similar laws
affecting the rights of creditors and general principles of equity (including,
without limitation, any provisions therein relating to Prepayment Charges). All
parties to the Mortgage Note, the Mortgage and any other such related agreement
had legal capacity to enter into the Mortgage Loan and to execute and deliver
the Mortgage Note, the Mortgage and any other related agreement, and the
Mortgage Note, the Mortgage and any other such related agreement have been duly
and properly executed by other such related parties. The documents, instruments
and agreements submitted for loan underwriting were not falsified and contain no
untrue statement of material fact or omit to state a material fact required to
be stated therein or necessary to make the information and statements therein
not misleading. No fraud, error, omission, misrepresentation, negligence or
similar occurrence with respect to a Mortgage Loan has taken place on the part
of any Person, including without limitation, the Mortgagor, any appraiser, any
builder or developer, or any other party involved in the origination or
servicing of the Mortgage Loan. The Seller has reviewed all of the documents
constituting the Servicing File and has made such inquiries as it deems
necessary to make and confirm the accuracy of the representations set forth
herein;
(l) Full Disbursement of Proceeds. Except to the extent the Mortgage
Loan is subject to completion escrows which have been disclosed to and
acknowledged by the Purchaser
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and which meet the requirements of the Underwriting Guidelines and as to which a
completed Xxxxxx Xxx Form 442 has been delivered to the Purchaser within sixty
(60) days after the related Closing Date, the Mortgage Loan has been closed and
the proceeds of the Mortgage Loan have been fully disbursed and there is no
requirement for future advances thereunder, and any and all requirements as to
completion of any on-site or off-site improvement and as to disbursements of any
escrow funds therefor have been complied with. 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;
(m) Ownership. The Seller or MERS is the sole owner of record and
holder of the Mortgage Loan and the indebtedness evidenced by each Mortgage Note
and upon the sale of the Mortgage Loans to the Purchaser, the Seller will retain
the Mortgage Files or any part thereof with respect thereto not delivered to the
Custodian, the Purchaser or the Purchaser's designee, in trust only for the
purpose of servicing and supervising the servicing of each Mortgage Loan. Except
for the lien of the Seller's warehouse lender, which lien will be released upon
payment of the related Purchase Price, the Mortgage Loan is not assigned or
pledged, and the Seller has good, indefeasible and marketable title thereto, and
has full right to transfer and sell the Mortgage Loan to the Purchaser free and
clear of any encumbrance, equity, participation interest, lien, pledge, charge,
claim or security interest, and has full right and authority subject to no
interest or participation of, or agreement with, any other party, to sell and
assign each Mortgage Loan pursuant to this Agreement and following the sale of
each Mortgage Loan, the Purchaser will own such Mortgage Loan free and clear of
any encumbrance, equity, participation interest, lien, pledge, charge, claim or
security interest related to the Seller. The Seller intends to relinquish all
rights to possess, control and monitor the Mortgage Loan. After the Closing
Date, the Seller will have no right to modify or alter the terms of the sale of
the Mortgage Loan and the Seller will have no obligation or right to repurchase
the Mortgage Loan or substitute another Mortgage Loan, except as provided in
this Agreement;
(n) Doing Business. 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 (2) either (i) organized
under the laws of such state, or (ii) qualified to do business, or exempt from
such qualification, in such state, or (iii) a federal savings and loan
association, a savings bank or a national bank having a principal office in such
state, or (3) not doing business in such state;
(o) CLTV, LTV; FICO Score. No Mortgage Loan that is a Second Lien Loan
has a CLTV in excess of 100%. No Mortgage Loan has an LTV greater than 100%. At
origination of the Mortgage Loan, the Mortgagor did not have a FICO score of
less than 500;
(p) Title Insurance. The Mortgage Loan is covered by an ALTA lender's
title insurance policy or other generally acceptable form of policy or insurance
acceptable to Xxxxxx Xxx or Xxxxxxx Mac and each such title insurance policy is
issued by a title insurer acceptable to Xxxxxx Mae or Xxxxxxx Mac and qualified
to do business in the jurisdiction where the Mortgaged Property is located,
insuring the Seller, its successors and assigns, as to the first priority lien
(with respect to First Lien Loans) or second priority lien
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(with respect to Second Lien Loans) of the Mortgage in the original principal
amount of the Mortgage Loan, subject only to the exceptions contained in clauses
(1), (2) and (3) of paragraph (j) of this Subsection 9.02, and in the case of
Adjustable Rate Mortgage Loans, against any loss by reason of the invalidity or
unenforceability of the lien resulting from the provisions of the Mortgage
providing for adjustment to the Mortgage Interest Rate and Monthly Payment.
Where required by state law or regulation, the Mortgagor has been given the
opportunity to choose the carrier of the required mortgage title insurance.
Additionally, such lender's title insurance policy affirmatively insures ingress
and egress, and against encroachments by or upon the Mortgaged Property or any
interest therein. The title policy does not contain any special exceptions
(other than the standard exclusions) for zoning and uses and has been marked to
delete the standard survey exception or to replace the standard survey exception
with a specific survey reading. The Seller, its successor and assigns, are the
sole insureds of such lender's title insurance policy, and such lender's title
insurance policy is valid and remains in full force and effect and will be in
force and effect upon the consummation of the purchase transactions contemplated
by this Agreement. No claims have been made under such lender's title insurance
policy, and no prior holder of the related Mortgage, including the Seller, has
done, by act or omission, anything which would impair the coverage of such
lender's title insurance policy, including without limitation, no unlawful fee,
commission, kickback or other unlawful compensation or value of any kind has
been or will be received, retained or realized by any attorney, firm or other
person or entity, and no such unlawful items have been received, retained or
realized by the Seller;
(q) No Defaults. Other than payments due but not yet thirty (30) days
or more delinquent, there is no default, breach, violation or event which would
permit acceleration existing under the Mortgage or the Mortgage Note and 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
which would permit acceleration, and neither the Seller nor any of its
affiliates nor any of their respective predecessors, have waived any default,
breach, violation or event which would permit acceleration. With respect to each
Second Lien Loan, (i) the prior mortgage is in full force and effect, (ii) there
is no default, breach, violation or event of acceleration existing under such
prior mortgage or the related mortgage note and (iii) there is 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 of acceleration
thereunder, and either (A) the prior mortgage contains a provision which allows
or (B) applicable law or the related Mortgage requires, the mortgagee under the
Second Lien Loan to receive notice of, and affords such mortgagee an opportunity
to cure any default by payment in full or otherwise under the prior mortgage;
(r) No Mechanics' Liens. Except as insured against by the related
title insurance, 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;
(s) Location of Improvements; No Encroachments. 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
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improvements on adjoining properties encroach upon the Mortgaged Property. The
Mortgaged Property and all improvements located on or being part of the
Mortgaged Property are in compliance with all applicable zoning and building
laws, ordinances and regulations;
(t) Origination; Payment Terms. The Mortgage Loan was originated by a
mortgagee approved by the Secretary of Housing and Urban Development pursuant to
Sections 203 and 211 of the Act, a savings and loan association, a savings bank,
a commercial bank, credit union, insurance company or other similar institution
which is supervised and examined by a federal or state authority. The documents,
instruments and agreements submitted for loan underwriting were not falsified
and contain no untrue statement of material fact or omit to state a material
fact required to be stated therein or necessary to make the information and
statements therein not misleading. No Mortgage Loan contains terms or provisions
which would result in negative amortization. Principal or interest payments on
the Mortgage Loan commenced or will commence no more than sixty (60) days after
funds were disbursed in connection with the Mortgage Loan. The Mortgage Interest
Rate as well as, with respect to Adjustable Rate Mortgage Loans, the Lifetime
Rate Cap, the Periodic Rate Floor and the Periodic Rate Cap are as set forth on
the related Mortgage Loan Schedule. The Mortgage Interest Rate is required to be
adjusted, with respect to Adjustable Rate Mortgage Loans, on each Interest Rate
Adjustment Date to equal the Index plus the Gross Margin (rounded up or down to
the nearest 0.125%), subject to the Periodic Rate Cap, the Periodic Rate Floor
and the Lifetime Rate Cap. Subject to a "balloon" payment in the case of a
Balloon Mortgage Loan, the Mortgage Note is payable in equal monthly
installments of principal and/or interest, which installments are subject to
change due to adjustments to the Mortgage Interest Rate and/or Monthly Payment
on each Interest Rate Adjustment Date or Monthly Payment Adjustment Date, with
interest calculated and payable in arrears, sufficient to amortize the Mortgage
Loan fully by the stated maturity date (unless the Mortgage Loan is identified
on the Mortgage Loan Schedule as a Balloon Mortgage Loan), over an original term
of not more than thirty (30) years from commencement of amortization. Unless
otherwise specified on the related Mortgage Loan Schedule, the Mortgage Loan is
payable on the first day of each month. There are no Convertible Mortgage Loans
which contain a provision allowing the Mortgagor to convert the Mortgage Note
from an adjustable interest rate Mortgage Note to a fixed interest rate Mortgage
Note. The Due Date of the first payment under the Mortgage Note is no more than
sixty (60) days from the date of the Mortgage Note;
(u) Customary Provisions. The Mortgage contains customary and
enforceable provisions (subject to bankruptcy, insolvency, and similar laws
affecting the rights of creditors and general principles of equity) 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. Upon
default by a Mortgagor on a Mortgage Loan and foreclosure on, or trustee's sale
of, the Mortgaged Property pursuant to the proper procedures, the holder of the
Mortgage Loan will be able to deliver good and merchantable title to the
Mortgaged Property. 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, subject to applicable
federal and state laws and judicial precedent with respect to bankruptcy and
right of redemption or similar law;
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(v) Conformance with Agency and Underwriting Guidelines. The Mortgage
Loan was underwritten in accordance with the related Underwriting Guidelines (a
copy of which is attached to the related Assignment and Conveyance Agreement as
Exhibit C). The Mortgage Note and Mortgage are on forms acceptable in the
secondary mortgage market and no representations have been made to a Mortgagor
that are inconsistent with the mortgage instruments used;
(w) Occupancy of the Mortgaged Property. As of the related Closing
Date the Mortgaged Property is capable of being lawfully occupied under
applicable law. 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. The Seller has not received
notification from any Governmental Authority that the Mortgaged Property is in
material non-compliance with such laws or regulations, is being used, operated
or occupied unlawfully or has failed to have or obtain such inspection, licenses
or certificates, as the case may be. The Seller has not received notice of any
violation or failure to conform with any such law, ordinance, regulation,
standard, license or certificate. If the Mortgage Loan is identified as
"owner-occupied" in the related Mortgage Loan Schedule, the Mortgagor
represented at the time of origination of the Mortgage Loan that the Mortgagor
would occupy the Mortgaged Property as the Mortgagor's primary residence;
(x) No Additional Collateral. The Mortgage Note is not and has not
been secured by any collateral except the lien of the corresponding Mortgage and
the security interest of any applicable security agreement or chattel mortgage
referred to in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and duly qualified under applicable law to serve as
such, has been properly designated and currently so serves and is named in the
Mortgage (or in the case of a substitution of trustee, is named in a properly
recorded substitution of trustee), and no fees or expenses are or will become
payable by the Purchaser, the Custodian or the Interim Servicer to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor;
(z) Acceptable Investment. To the Seller's knowledge, there are no
circumstances or conditions with respect to the Mortgage, the Mortgaged
Property, the Mortgagor, the Mortgage File or the Mortgagor's credit standing
that can reasonably be expected to cause private institutional investors who
invest in mortgage loans similar to the Mortgage Loan to regard the Mortgage
Loan as an unacceptable investment, cause the Mortgage Loan to become
delinquent, or adversely affect the value or marketability of the Mortgage Loan,
or cause the Mortgage Loan to prepay during any period materially faster or
slower than the mortgage loans originated by the Seller generally except for the
non-prime nature of the Mortgage Loans and the related Mortgagor's credit. No
Mortgaged Property is located in a state, city, county or other local
jurisdiction as described in the related Purchase Price and Terms Agreement
which the Purchaser has determined in its reasonable good faith discretion would
cause the related Mortgage Loan to be ineligible for whole loan sale or
securitization in a transaction consistent with the prevailing sale and
securitization industry (including, without limitation, the practice of the
rating agencies) with respect to substantially similar mortgage loans;
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(aa) Delivery of Mortgage Documents. The Mortgage Note, the Mortgage,
the Assignment of Mortgage, if any, and any other documents required to be
delivered to the Custodian under this Agreement for each Mortgage Loan have been
delivered to the Custodian. The Seller is in possession of a complete, true and
accurate Mortgage File in compliance with Exhibit A hereto, except for such
documents the originals of which have been delivered to the Custodian, and the
Seller has retained copies thereof;
(bb) Condominiums/Planned Unit Developments. 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
is in conformance with the related Underwriting Guidelines;
(cc) Transfer of Mortgage Loans. Except with respect to MERS
Designated Mortgage Loans, the Assignment of Mortgage with respect to each
Mortgage Loan is in recordable form and is acceptable for recording under the
laws of the jurisdiction in which the Mortgaged Property is located. The
transfer, assignment and conveyance of the Mortgage Notes and the Mortgages by
the Seller are not subject to the bulk transfer or similar statutory provisions
in effect in any applicable jurisdiction;
(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision (subject to applicable law) for the
acceleration of the payment of the unpaid principal balance of the Mortgage Loan
in the event that the Mortgaged Property is sold or transferred without the
prior written consent of the mortgagee thereunder;
(ee) No Balloon Mortgage Loans. The Mortgage Loan is not a Balloon
Mortgage Loan unless specifically listed on the Mortgage Loan Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to which
Monthly Payments are paid or partially paid with funds deposited in any separate
account established by the Seller, the Mortgagor, or anyone on behalf of the
Mortgagor, or paid by any source other than the Mortgagor nor does it contain
any other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan, and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature. The
indebtedness evidenced by the Mortgage Note is not convertible to an ownership
interest in the Mortgaged Property or the Mortgagor and the Seller has not
financed nor does it own directly or indirectly, any equity of any form in the
Mortgaged Property or the Mortgagor;
(gg) Consolidation of Future Advances. Any future advances made to the
Mortgagor prior to the applicable Cut-off Date have been consolidated with the
outstanding principal amount secured by the Mortgage, and the secured principal
amount, as consolidated, bears a single interest rate and single repayment term.
The lien of the Mortgage securing the consolidated principal amount is expressly
insured as having first or second, as applicable, lien priority by a title
insurance policy, an endorsement to the policy insuring the mortgagee's
consolidated interest or by other title evidence acceptable to Xxxxxx Xxx and
Xxxxxxx Mac. The consolidated principal amount does not exceed the original
principal amount of the Mortgage Loan;
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(hh) Mortgaged Property Undamaged; No Condemnation Proceedings. The
Mortgaged Property is undamaged by waste, 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 and each Mortgaged Property is in good repair. There
have not been any condemnation proceedings with respect to the Mortgaged
Property. Additionally, there is no proceeding pending for the total or partial
condemnation of the Mortgaged Property and the Seller has no knowledge of any
such proceedings in the future;
(ii) Collection Practices; Escrow Deposits; Interest Rate Adjustments.
The origination, servicing and collection practices with respect to the Mortgage
Loan have been in all respects in compliance with Accepted Servicing Practices,
applicable laws and regulations, and have been in all respects legal and proper.
With respect to escrow deposits and Escrow Payments (other than with respect to
Second Lien Loans for which the mortgagee under the prior mortgage lien is
collecting Escrow Payments), all such payments are in the possession of Seller
and there exist no deficiencies in connection therewith for which customary
arrangements for repayment thereof have not been made. Each Mortgage Loan is
covered by a paid in full, life of loan, tax service contract that will be
assigned without penalty, premium or cost to the Purchaser. All Escrow Payments
have been collected in full compliance with state and federal law and the
provisions of the related Mortgage Note and Mortgage. An escrow of funds is not
prohibited by applicable law and, if established for the Mortgage Loan, has been
established in an amount sufficient 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 Seller have been
capitalized under the Mortgage or the Mortgage Note. All Mortgage Interest Rate
adjustments have been made in strict compliance with state and federal law and
the terms of the related Mortgage and Mortgage Note on the related Interest Rate
Adjustment Date. If, pursuant to the terms of the Mortgage Note, another index
was selected for determining the Mortgage Interest Rate, the same index was used
with respect to each Mortgage Note which required a new index to be selected,
and such selection did not conflict with the terms of the related Mortgage Note.
Any and all notices required under applicable law and the terms of the related
Mortgage Note and Mortgage regarding the Mortgage Interest Rate and the Monthly
Payment adjustments have been delivered. Any interest required to be paid by the
Seller to the Mortgagor pursuant to state, federal and local law has been
properly paid and credited;
(jj) Mortgage Loan Attributes: The Mortgage Loan fits within the
characteristics set forth on Exhibit B to the related Assignment and Conveyance
Agreement;
(kk) Other Insurance Policies; No Defense to Coverage. No action,
inaction or event has occurred and no state of facts exists or has existed on or
prior to the related Closing Date that has resulted or will result in the
exclusion from, denial of, or defense to coverage under any applicable primary
mortgage insurance policy, hazard insurance policy or bankruptcy bond
(including, without limitation, any exclusions, denials or defenses which would
limit or reduce the availability of the timely payment of the full amount of the
loss otherwise due thereunder to the insured), irrespective of the cause of such
failure of coverage. The Seller has caused or, before or in connection with the
transfer of servicing, will cause to be performed any and all acts required to
preserve the rights and remedies of the Purchaser in any insurance policies
applicable to the Mortgage Loans including, without limitation, any necessary
notifications of insurers,
-34-
assignments of policies or interests therein, and establishments of coinsured,
joint loss payee and mortgagee rights in favor of the Purchaser. In connection
with the placement of any such insurance, no commission, fee, or other
compensation has been or will be received by the Seller or by any officer,
director, or employee of the Seller or any designee of the Seller or any
corporation in which the Seller or any officer, director, or employee had a
financial interest at the time of placement of such insurance;
(ll) No Violation of Environmental Laws. The Mortgaged Property is
free from any and all toxic or hazardous substances and there exists no
violation of any local, state or federal environmental law, rule or regulation.
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; 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;
(mm) Servicemembers' Civil Relief Act. The Mortgagor has not notified
the Seller, and the Seller has no knowledge of any relief requested or allowed
to the Mortgagor under the Servicemembers' Civil Relief Act of 1940, as amended,
or any similar state statute;
(nn) Appraisal. The Seller has delivered to the Purchaser an appraisal
of the Mortgaged Property signed prior to the approval of the Mortgage
application by an appraiser who (i) was licensed in the state where the
Mortgaged Property is located, (ii) had no interest, direct or indirect, in the
Mortgaged Property or in any Loan or the security therefor, and (iii) did not
receive compensation that affected the approval or disapproval of the Mortgage
Loan. The appraisal shall have been made within one hundred and eighty (180)
days of the origination of the Mortgage Loan and shall be completed in
compliance with the Uniform Standards of Professional Appraisal Practice, and
all applicable federal and state laws and regulations. If the appraisal was made
more than one hundred and twenty (120) days before the origination of the
Mortgage Loan, the Seller shall have received and delivered to the Purchaser a
recertification of the appraisal;
(oo) Disclosure Materials. The Mortgagor has, to the extent required
by applicable law, executed one or more statements to the effect that the
Mortgagor has, received all disclosure materials required by applicable law and
the Seller has complied with all applicable law with respect to the making of
the Mortgage Loans. The Seller shall cause the Interim Servicer to maintain such
statement(s) in the Mortgage File;
(pp) Construction or Rehabilitation of Mortgaged Property. The
Mortgage Loan was not made to finance the construction or rehabilitation of a
Mortgaged Property or facilitating the trade-in or exchange of a Mortgaged
Property;
(qq) [Reserved].
(rr) Qualified Mortgage. The Mortgage Loan is a qualified mortgage
under Section 860G(a)(3) of the Code;
(ss) Credit Information; Fair Credit Reporting Act. As to each
consumer report (as defined in the Fair Credit Reporting Act, Public Law 91-508)
or other credit information
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furnished by the Seller to the Purchaser, the Seller has full right and
authority and is not precluded by law or contract from furnishing such
information to the Purchaser and the Purchaser is not precluded by the terms of
the Mortgage Loan Documents from furnishing the same to any subsequent or
prospective purchaser of such Mortgage. The Seller shall hold the Purchaser
harmless from any and all damages, losses, costs and expenses (including
attorney's fees) arising from disclosure of credit information in connection
with the Purchaser's secondary marketing operations and the purchase and sale of
mortgages. The Seller has in its capacity as servicer, for each Mortgage Loan,
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. The last sentence of the representation is a Deemed Material Breach
Representation;
(tt) Leaseholds. If the Mortgage Loan is secured by a long-term
residential lease, (1) the lessor under the lease holds a fee simple interest in
the land; (2) the terms of such lease expressly permit the mortgaging of the
leasehold estate and the acquisition by the holder of the Mortgage of the rights
of the lessee upon foreclosure or assignment in lieu of foreclosure or provide
the holder of the Mortgage with substantially similar protections; (3) the terms
of such lease do not (a) allow the termination thereof upon the lessee's default
without the holder of the Mortgage being entitled to receive written notice of,
and opportunity to cure, such default, (b) allow the termination of the lease in
the event of damage or destruction as long as the Mortgage is in existence, (c)
prohibit the holder of the Mortgage from being insured (or receiving proceeds of
insurance) under the hazard insurance policy or policies relating to the
Mortgaged Property or (d) permit any increase in rent other than pre-established
increases set forth in the lease; (4) the original term of such lease is not
less than fifteen (15) years; (5) the term of such lease does not terminate
earlier than five years after the maturity date of the Mortgage Note; and (6)
the Mortgaged Property is located in a jurisdiction in which the use of
leasehold estates in transferring ownership in residential properties is a
widely accepted practice;
(uu) Prepayment Penalty. The Mortgage Loan is subject to a prepayment
penalty as provided in the related Mortgage Note except as set forth on the
related Mortgage Loan Schedule. With respect to each Mortgage Loan that has a
prepayment penalty feature, each such prepayment penalty is enforceable (subject
to bankruptcy, insolvency, and similar laws affecting the rights of creditors
and general principles of equity) for the benefit of the Purchaser, and each
prepayment penalty is permitted pursuant to applicable law. Each such prepayment
penalty (x) is in an amount not greater than the maximum amount permitted under
applicable law and (y) may not be imposed for a term in excess of five (5)
years. With respect to any Mortgage Loan that contains a provision permitting
imposition of a prepayment penalty upon a prepayment prior to maturity: (i) the
Mortgage Loan provides some benefit to the Mortgagor (e.g., a rate or fee
reduction) in exchange for accepting such prepayment penalty, (ii) prior to the
Mortgage Loan origination, the Mortgagor had the option of obtaining a mortgage
loan that did not require payment of such a penalty and (iii) the prepayment
penalty was adequately disclosed to the Mortgagor pursuant to applicable state,
local and federal law. Clause (y) of the third sentence of this representation
and warranty is a Deemed Material and Adverse Representation;
(vv) Conversion to Fixed Interest Rate. With respect to Adjustable
Rate Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;
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(ww) Escrow Analysis. With respect to each Mortgage, the Seller has
within the last twelve (12) months (unless such Mortgage was originated within
such twelve month period) analyzed the required Escrow Payments for each
Mortgage and adjusted the amount of such payments so that, assuming all required
payments are timely made, any deficiency will be eliminated on or before the
first anniversary of such analysis, or any overage will be refunded to the
Mortgagor, in accordance with RESPA and any other applicable law;
(xx) Predatory Lending Regulations. No Mortgage Loan is a High Cost
Loan or Covered Loan, as applicable, and no Mortgage Loan originated on or after
October 1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending
Act. No Mortgage Loan is covered by the Home Ownership and Equity Protection Act
of 1994 and no Mortgage Loan is in violation of any comparable state or local
law. The Mortgaged Property is not located in a jurisdiction where a breach of
this representation with respect to the related Mortgage Loan may result in
additional assignee liability to the Purchaser, as determined by Purchaser in
its reasonable discretion and as described in the related Purchase Price and
Terms Agreement. The first two sentences of this representation are Deemed
Material Breach Representations;
(yy) Purchase of Insurance. No Mortgagor was required to purchase any
credit life, disability, accident or health insurance product as a condition of
obtaining the extension of credit. No Mortgagor obtained a prepaid
single-premium credit life, disability, accident or health insurance policy in
connection with the origination of the Mortgage Loan. No proceeds from any
Mortgage Loan were used to purchase single premium credit insurance policies as
part of the origination of, or as a condition to closing, such Mortgage Loan.
This representation and warranty is a Deemed Material Breach Representation;
(zz) Regarding the Mortgagor. The Mortgagor is one or more natural
persons and/or an Illinois land trust or a "living trust" and such "living
trust" is in compliance with Xxxxxx Xxx guidelines for such trusts;
(aaa) Insurance. The Seller has caused or, before or in connection
with the transfer of servicing, will cause to be performed any and all acts
required to preserve the rights and remedies of the Purchaser in any insurance
policies applicable to the Mortgage Loans including, without limitation, any
necessary notifications of insurers, assignments of policies or interests
therein, and establishments of coinsured, joint loss payee and mortgagee rights
in favor of the Purchaser;
(bbb) Simple Interest Mortgage Loans. The Mortgage Loan is not a
simple interest Mortgage Loan;
(ccc) Flood Certification Contract. The Mortgage Loan is covered by a
paid in full, life of loan, transferable flood certification contract that has
been or will be assigned without penalty, cost or premium to the Purchaser;
(ddd) Consent. Either (a) no consent for the Second Lien Loan is
required by the holder of the related first lien or (b) such consent has been
obtained and is contained in the Mortgage File;
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(eee) Origination Date. Except as shown on the related Mortgage Loan
Schedule, the date of origination of the Mortgage Loan shall be no earlier than
three (3) months prior to the date such Mortgage Loan is first purchased by the
Purchaser;
(fff) Mortgage Submitted for Recordation. The Mortgage either has been
or will promptly be submitted for recordation in the appropriate governmental
recording office of the jurisdiction where the Mortgaged Property is located;
(ggg) Endorsements. The Mortgage Note has been endorsed by Seller for
its own account and not as a fiduciary, trustee, trustor or beneficiary under a
trust agreement;
(hhh) Accuracy of Information. All information provided to the
Purchaser by the Seller with respect to the Mortgage Loan is accurate in all
material respects;
(iii) No Construction Loans. No Mortgage Loan was made to (a)
facilitate the trade-in or exchange of a Mortgaged Property or (b) finance the
construction or rehabilitation of a Mortgaged Property, unless the Mortgage Loan
is a construction-to-permanent mortgage loan which has been fully disbursed, all
construction work is complete and a completion certificate has been issued;
(jjj) No Equity Participation. No document relating to the Mortgage
Loan provides for any contingent or additional interest in the form of
participation in the cash flow of the Mortgaged Property or a sharing in the
appreciation of the value of the Mortgaged Property. The indebtedness evidenced
by the Mortgage Note is not convertible to an ownership interest in the
Mortgaged Property or the Mortgagor and Seller has not financed nor does it own
directly or indirectly, any equity of any form in the Mortgaged Property or the
Mortgagor;
(kkk) No Arbitration. No Mortgage Loan originated on or after August
1, 2004 requires the Mortgagor to submit to arbitration to resolve any dispute
arising out of or relating in any way to the mortgage loan transaction. This
representation is a Deemed Material Breach Representation;
(lll) Origination Practices/No Steering. The Mortgagor was not
encouraged or required to select a Mortgage Loan product offered by the Mortgage
Loan's originator which is a higher cost product designed for less creditworthy
borrowers, unless at the time of the Mortgage Loan's origination, such Mortgagor
did not qualify taking into account such facts as, without limitation, the
Mortgage Loan's requirements and the Mortgagor's credit history, income, assets
and liabilities and debt-to-income ratios for a lower-cost credit product then
offered by the Mortgage Loan's originator or any affiliate of the Mortgage
Loan's originator. If, at the time of loan application, the Mortgagor may have
qualified for a lower-cost credit product then offered by any mortgage lending
affiliate of the Mortgage Loan's originator, the Mortgage Loan's originator
referred the Mortgagor's application to such affiliate for underwriting
consideration. This representation is a Deemed Material Breach Representation;
(mmm) Underwriting Methodology. The methodology used in underwriting
the extension of credit for each Mortgage Loan does not rely solely on the
extent of the Mortgagor's equity in the collateral as the principal determining
factor in approving such extension of credit.
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The methodology employed objective criteria such facts as, without limitation,
the Mortgagor's income, assets and liabilities (except in the case of loan
programs which do not require the Mortgagor to report the Mortgagor's income or
assets, such as "no income, no assets" lending programs) or which rely on the
Mortgagor's representation of the Mortgagor's income, such as "stated income"
lending programs) to the proposed mortgage payment and, based on such
methodology, the Mortgage Loan's originator made a reasonable determination that
at the time of origination the Mortgagor had the ability to make timely payments
on the Mortgage Loan. This representation is a Deemed Material Breach
Representation;
(nnn) Fees Charges. All fees and charges (including finance charges)
and whether or not financed, assessed, collected or to be collected in
connection with the origination and servicing of each Mortgage Loan have been
disclosed in writing to the Mortgagor in accordance with applicable state and
federal law and regulation. This representation is a Deemed Material Breach
Representation; and
(ooo) Second Lien Mortgage Loans. With respect to each Second Lien
Loan: (1) the related First Lien Loan does not permit negative amortization; (2)
where required or customary in the jurisdiction in which the Mortgaged Property
is located, the original lender has filed for record a request for notice of any
action by the related senior lienholder, and the Seller has notified such second
lienholder in writing of the existence of the Second Lien Loan and requested
notification of any action to be taken against the Mortgagor by such senior
lienholder; either (a) no consent for the Second Lien Loan is required by the
holder of the related First Lien Loan or (b) such consent has been obtained and
is contained in the related Mortgage File; (3) the related first lien Mortgage
contains a provision which provides for giving notice of default or breach to
the mortgagee under the Mortgage Loan and allows such mortgagee to cure any
default under the related First Lien Mortgage; and (4) except as set forth on
the related Mortgage Loan Schedule, the related Mortgaged Property was the
Mortgagor's principal residence at the time of the origination of such Second
Lien Loan. Item (4) of this representation is a Deemed Material Breach
Representation.
Subsection 9.03. Remedies for Breach of Representations and
Warranties.
It is understood and agreed that the representations and warranties
set forth in Subsections 9.01 and 9.02 shall survive the sale of the Mortgage
Loans to the Purchaser and shall inure to the benefit of the Purchaser,
notwithstanding any restrictive or qualified endorsement on any Mortgage Note or
Assignment of Mortgage or, subject to Section 5, the examination or failure to
examine any Mortgage File. Upon discovery by either the Seller or the Purchaser
of a breach of any of the foregoing representations and warranties, the party
discovering such breach shall give prompt written notice to the other.
Within sixty (60) days of the earlier of either discovery by or notice
to the Seller of any breach of a representation or warranty which materially and
adversely affects the value of the Mortgage Loans or the interest of the
Purchaser therein (or which materially and adversely affects the value of the
applicable Mortgage Loan or the interest of the Purchaser therein in the case of
a representation and warranty relating to a particular Mortgage Loan), the
Seller shall use its best efforts promptly to cure such breach in all material
respects and, if such breach cannot be cured, the Seller shall, at the
Purchaser's option, repurchase such Mortgage Loan at the
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Repurchase Price. Notwithstanding the above sentence, (i) within sixty (60) days
of the earlier of either discovery by, or notice to, the Seller of any breach of
the representation and warranty set forth in clause (rr) of Subsection 9.02, the
Seller shall repurchase such Mortgage Loan at the Repurchase Price and (ii) any
breach of a Deemed Material Breach Representation shall automatically be deemed
to materially and adversely affect the value of the Mortgage Loan and the
interest of the Purchaser therein. In the event that a breach shall involve any
representation or warranty set forth in Subsection 9.01, and (except as provided
in the preceding sentence with respect to certain breaches for which no cure is
permitted) such breach cannot be cured within sixty (60) days of the earlier of
either discovery by or notice to the Seller of such breach, all of the Mortgage
Loans materially and adversely affected thereby shall, at the Purchaser's
option, be repurchased by the Seller at the Repurchase Price. However, if the
breach shall involve a representation or warranty set forth in Subsection 9.02
(other than the representations and warranties set forth in clause (rr) of such
Subsection or any Deemed Material Breach Representation) and the Seller
discovers or receives notice of any such breach within one hundred twenty (120)
days of the related Closing Date, the Seller shall, at the Purchaser's option
and provided that the Seller has a Qualified Substitute Mortgage Loan, rather
than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan
(a "Deleted Mortgage Loan") and substitute in its place a Qualified Substitute
Mortgage Loan or Loans, provided that any such substitution shall be effected
not later than one hundred twenty (120) days after the related Closing Date. If
the Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the
deficient Mortgage Loan. Any repurchase of a Mortgage Loan or Loans pursuant to
the foregoing provisions of this Subsection 9.03 shall be accomplished by either
(a) if the Interim Servicing Agreement has been entered into and is in effect,
deposit in the Custodial Account of the amount of the Repurchase Price for
distribution to the Purchaser on the next scheduled Remittance Date, 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 or
(b) if the Interim Servicing Agreement has not been entered into or is no longer
in effect, by direct remittance of the Repurchase Price to the Purchaser or its
designee in accordance with the Purchaser's instructions.
With respect to any repurchase under this Section 9.03: (i) the
repurchase request must be made by the Purchaser in a prompt and timely manner
and must contain reasonably sufficient information to enable the Seller to
evaluate the request, including in the case of a first payment default, the
payment history, collection comments and such other information to the extent
reasonably requested by Seller and available to the Purchaser, (ii) with respect
to any Mortgage Loan that was never included in a Securitization Transaction,
the Purchaser shall use best efforts to notify the Seller of any known breach of
a representation and warranty and require the Seller to repurchase such Mortgage
Loan prior to foreclosure procedures commencing on such Mortgage Loan.
Upon Purchaser's receipt of the related Repurchase Price, Purchaser
shall (i) promptly release its interest in the Deleted Mortgage Loan to the
Seller, free and clear of any lien, charge or encumbrance suffered or incurred
by the Purchaser, and (ii) promptly, but in no event later than twenty (20) days
after payment of the Repurchase Price, deliver or cause to be delivered to the
Seller any documents held by the Custodian, servicer or other designee relating
to the Deleted Mortgage Loan. In the event of a repurchase or substitution, the
Seller shall, simultaneously with such reassignment, give written notice to the
Purchaser that such repurchase
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or substitution has taken place, and, in the case of substitution, identify a
Qualified Substitute Mortgage Loan and amend the Mortgage Loan Schedule to
reflect the addition of such Qualified Substitute Mortgage Loan to this
Agreement. In connection with any such substitution, the Seller shall be deemed
to have made as to such Qualified Substitute Mortgage Loan the representations
and warranties set forth in this Agreement except that all such representations
and warranties set forth in this Agreement shall be deemed made as of the date
of such substitution. The Seller shall effect such substitution by delivering to
the Custodian or to such other party as the Purchaser may designate in writing
for such Qualified Substitute Mortgage Loan the documents required by Subsection
6.03, with the Mortgage Note endorsed as required by Subsection 6.03. No
substitution will be made in any calendar month after the Determination Date for
such month. The Seller shall cause the Interim Servicer to remit directly to the
Purchaser, or its designee in accordance with the Purchaser's instructions the
Monthly Payment less the Servicing Fee due, if any, on such Qualified Substitute
Mortgage Loan or Loans in the month following the date of such substitution.
Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the
month of substitution shall be retained by the Seller. For the month of
substitution, distributions to the Purchaser shall include the Monthly Payment
due on any Deleted Mortgage Loan in the month of substitution, and the Seller
shall thereafter be entitled to retain all amounts subsequently received by the
Seller in respect of such Deleted Mortgage Loan.
For any month in which the Seller substitutes a Qualified Substitute
Mortgage Loan for a Deleted Mortgage Loan, the Seller shall determine the amount
(if any) by which the aggregate principal balance of all Qualified Substitute
Mortgage Loans as of the date of substitution is less than the aggregate Stated
Principal Balance of all Deleted Mortgage Loans (after application of scheduled
principal payments due in the month of substitution). The amount of such
shortfall shall be distributed by the Seller directly to the Purchaser or its
designee in accordance with the Purchaser's instructions within two (2) Business
Days of such substitution.
In addition to such repurchase or substitution obligation, the Seller
shall indemnify the Purchaser and its present and former directors, officers,
employees and agents and any Successor Servicer and its present and former
directors, officers, employees and agents and hold such parties harmless against
any losses, damages, penalties, fines, forfeitures, legal fees and expenses 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 Seller representations and warranties contained in this Agreement
or any Reconstitution Agreement. It is understood and agreed that the
obligations of the Seller set forth in this Subsection 9.03 to cure, substitute
for or repurchase a defective Mortgage Loan and to indemnify the Purchaser and
Successor Servicer as provided in this Subsection 9.03 and Subsection 14.01
constitute the sole remedies of the Purchaser and Successor Servicer respecting
a breach of the foregoing representations and warranties. For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean any Person designated as the
Successor Servicer pursuant to this Agreement and any and all Persons who
previously were "Successor Servicers" pursuant to this Agreement.
Any cause of action against the Seller relating to or arising out of
the breach of any representations and warranties made in Subsections 9.01 and
9.02 shall accrue as to any
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Mortgage Loan upon (i) discovery of such breach by the Purchaser or notice
thereof by the Seller to the Purchaser, (ii) failure by the Seller to cure such
breach or repurchase such Mortgage Loan as specified above, and (iii) demand
upon the Seller by the Purchaser for compliance with this Agreement.
Subsection 9.04. Repurchase of Mortgage Loans That Prepay in Full.
If any Mortgage Loan is prepaid in full within sixty (60) days from
and after the related Closing Date, the Seller shall pay to the Purchaser,
within five (5) business days following the Seller's receipt of written demand
therefore, which demand must be made within forty-five (45) days following the
date of such prepayment in full, an amount equal to (a) the Premium Percentage
multiplied by the outstanding principal balance of such Mortgage Loan as of the
date of such prepayment in full, less (b) the amount of any prepayment penalty
enforceable in connection with such prepayment.
Subsection 9.05. Repurchase of Mortgage Loans with First Payment
Defaults.
If the related Mortgagor is thirty (30) or more days delinquent with
respect to either the Mortgage Loan's Monthly Payment due in the month in which
the Closing Date occurs or the Monthly Payment due in the month following the
month of the Closing Date, the Seller, at the Purchaser's option exercised in
its sole discretion within forty-five (45) days following the occurrence of such
delinquency, shall repurchase such Mortgage Loan from the Purchaser at a price
equal to the percentage of par as stated in the related Purchase Price and Terms
Agreement (subject to adjustment as provided therein) multiplied by the then
outstanding principal balance of such Mortgage Loan, plus accrued and unpaid
interest thereon from the date to which interest was last paid through the day
prior to the repurchase date at the applicable Mortgage Interest Rate, plus any
outstanding advances owed to any servicer in connection with such Mortgage Loan.
Subsection 9.06. Purchaser's Right to Review.
Prior to the related Closing Date, the Purchaser shall have the right
to review each Mortgage File and Credit File, to conduct property inspections,
obtain appraisal recertifications, drive-by appraisals, brokers price opinions
and otherwise to underwrite the Mortgage Loans and to reject any Mortgage Loan
which in the Purchaser's sole opinion is an unacceptable investment. Any
rejected Mortgage Loan shall be removed from the terms of this Agreement.
All rights of the Purchaser under this Subsection 9.06 shall terminate
upon the transfer of any Mortgage Loan to any other Purchaser.
Notwithstanding the foregoing, the fact that the Purchaser or its
designee has conducted or failed to conduct the review/due diligence procedures
specified above or any other partial or complete examination of the Mortgage
Files or Credit Files shall not impair in any way the Purchaser's or any of its
successors' rights to demand repurchase, substitution or any other remedy
provided under this Agreement; provided, however, that Purchaser may not demand
a repurchase or other relief or remedy due to the failure of a Mortgage Loan to
comply with the Underwriting Guidelines if the Purchaser or its designee has
previously examined such Mortgage
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Loan and certain exceptions to the Underwriting Guidelines were noted and
accepted by the Purchaser prior to the purchase of such Mortgage Loan.
SECTION 10. Closing.
The closing for the purchase and sale of each Mortgage Loan Package
shall take place on the related Closing Date. At the Purchaser's option, the
Closing shall be either: by telephone, confirmed by letter or wire as the
parties shall agree, or conducted in person, at such place as the parties shall
agree.
The closing for the Mortgage Loans to be purchased on each Closing
Date shall be subject to each of the following conditions:
(a) at least two (2) Business Days prior to the related Closing Date,
or such later date on which the Purchaser has identified to the
Seller the final list of Mortgage Loans the Purchaser desires to
purchase, the Seller shall deliver to the Purchaser, in
electronic format acceptable to the Purchaser in its sole
discretion, a listing on a loan-level basis of the necessary
information to compute the Purchase Price of the Mortgage Loans
delivered on the Closing Date (including accrued interest), and
prepare a Mortgage Loan Schedule;
(b) all of the representations and warranties of the Seller under
this Agreement and of the Interim Servicer under the Interim
Servicing Agreement (with respect to each Mortgage Loan for an
interim period, as specified therein) 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 or an Event of Default under the
Interim Servicing Agreement;
(c) the Purchaser shall have received, or the Purchaser's attorneys
shall have received in escrow, all closing documents as specified
in Section 11 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 terms
hereof;
(d) the Seller shall have delivered and released to the Custodian all
documents required pursuant to this Agreement; and
(e) all other terms and conditions of this Agreement and the related
Purchase Price and Terms Agreement shall have been complied with.
Subject to the foregoing conditions, the Purchaser shall pay to the
Seller on the related Closing Date the Purchase Price, plus accrued interest
pursuant to Section 4 of this Agreement, by wire transfer of immediately
available funds to the account(s) designated by the Seller.
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SECTION 11. Closing Documents.
The Closing Documents for the Mortgage Loans to be purchased on each
Closing Date shall consist of fully executed originals of the following
documents:
1. this Agreement (to be executed and delivered only for the initial
Closing Date);
2. a copy of the Interim Servicing Agreement, dated as of October 1,
2003;
3. a copy of the Custodial Agreement, dated as of October 1, 2003;
4. the related Mortgage Loan Schedule and Points Schedule,
segregated by Mortgage Loan Package, one copy to be attached to
the Custodian's counterpart of the Custodial Agreement, and one
copy to be attached to the related Assignment and Conveyance as
the Mortgage Loan Schedule thereto;
5. a Custodian's Certification, as required under the Custodial
Agreement, in the form of Exhibit G-1 to the Custodial Agreement;
6. with respect to the initial Closing Date, an Officer's
Certificate, in the form of Exhibit C hereto with respect to each
of the Seller and the Interim Servicer, including all attachments
hereto; with respect to subsequent Closing Dates, an Officer's
Certificate upon request of the Purchaser;
7. with respect to the initial Closing Date, an Opinion of Counsel
of each of the Seller and the Interim Servicer (who may be an
employee of the Seller or the Interim Servicer, as applicable),
in the form of Exhibit D hereto ("Opinion of Counsel of the
Seller"); with respect to subsequent Closing Dates, an Opinion of
Counsel of the Seller upon request of the Purchaser;
8. a Security Release Certification, substantially in the form of
Exhibit E or F, as applicable, hereto executed by any person, as
requested by the Purchaser, if any of the Mortgage Loans have at
any time been subject to any security interest, pledge or
hypothecation for the benefit of such person;
9. a certificate or other evidence of merger or change of name,
signed or stamped by the applicable regulatory authority, if any
of the Mortgage Loans were acquired by the Seller by merger or
acquired or originated by the Seller while conducting business
under a name other than its present name, if applicable;
10. the related Underwriting Guidelines to be attached to the related
Assignment and Conveyance as Exhibit C;
11. Assignment and Conveyance Agreement in the form of Exhibit H
hereto;
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12. Exhibit B to the related Assignment and Conveyance Agreement; and
13. a MERS Report reflecting the Purchaser as Investor and no Person
as Interim Funder for each MERS Designated Mortgage Loan (to be
delivered within one Business Day of each Closing Date).
The Seller shall bear the risk of loss of the closing documents until
such time as they are received by the Purchaser or its attorneys.
SECTION 12. Costs.
The Purchaser shall pay any commissions due its salesmen and the legal
fees and expenses of its attorneys and custodial fees and the fees and expenses
of the Custodian. All other costs and expenses incurred in connection with the
one-time transfer and delivery of the Mortgage Loans and the Servicing Rights
including recording fees, fees for title policy endorsements and continuations,
fees for recording Assignments of Mortgage, and the Seller's attorney's fees,
shall be paid by the Seller.
SECTION 13. Cooperation of Seller with a Reconstitution.
The Seller and the Purchaser agree that with respect to some or all of
the Mortgage Loans, after each Closing Date, on one or more dates (each, a
"Reconstitution Date") at the Purchaser's sole option, the Purchaser may effect
six (6) Reconstitutions within twelve (12) months following the related Closing
Date of some or all of the Mortgage Loans then subject to this Agreement,
without recourse, to:
a) Xxxxxx Mae under its Cash Purchase Program or MBS Program
(Special Servicing Option) (each, a "Xxxxxx Xxx Transfer"); or
b) Xxxxxxx Mac (the "Xxxxxxx Mac Transfer"); or
c) one or more third party purchasers in one or more Whole Loan
Transfers; or
d) one or more trusts or other entities to be formed as part of one
or more Securitization Transactions.
The Seller agrees to execute in connection with any Agency Transfer,
any and all reasonably acceptable pool purchase contracts, and/or agreements
among the Purchaser, the Seller, Xxxxxx Mae or Xxxxxxx Mac (as the case may be)
and any servicer in connection with a Whole Loan Transfer, a seller's warranties
and servicing agreement or a participation and servicing agreement in form and
substance reasonably acceptable to the parties, and in connection with a
Securitization Transaction, an Assignment and Recognition Agreement
substantially in the form attached hereto as Exhibit I (collectively, the
agreements referred to herein are designated, the "Reconstitution Agreements"),
together with an opinion of counsel as to customary corporate matters (which may
be an in house opinion of counsel) with respect to such Reconstitution
Agreements but only to the extent that such opinions are customarily delivered
and reasonably necessary; provided, however that Seller shall not be required to
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service into a securitization and/or be a party to the pooling and servicing
agreement unless Seller consents in its sole discretion.
With respect to each Whole Loan Transfer and each Securitization
Transaction entered into by the Purchaser, the Seller agrees (1) to cooperate
fully with the Purchaser and any prospective purchaser with respect to all
reasonable requests and due diligence procedures; (2) to execute, deliver and
perform all Reconstitution Agreements reasonably required by the Purchaser; (3)
to restate the representations and warranties as set forth in the Assignment and
Recognition Agreement, a form which is attached as Exhibit I. The Seller shall
use its reasonable best efforts to provide to such master servicer or issuing
entity, as the case may be, and any other participants or purchasers in such
Reconstitution: (i) any and all appropriate information and appropriate
verification of information which may be reasonably available to the Seller or
its affiliates, whether through letters of its auditors and counsel or
otherwise, as the Purchaser or any such other participant shall reasonably
request; and (ii) such additional representations, warranties, covenants and
certificates of public officials or officers of the Seller or the Interim
Servicer as are reasonably believed necessary by the Purchaser or any such other
participant and as are reasonably acceptable to the Seller; and (iii) shall
execute, and deliver an Indemnification and Contribution Agreement in
substantially the form attached hereto as Exhibit J. Moreover, the Seller agrees
to cooperate with all reasonable requests made by the Purchaser to effect such
Reconstitution Agreements. The Seller shall indemnify the Purchaser, each
affiliate of the Purchaser participating in the Reconstitution and each Person
who controls the Purchaser or such affiliate and their respective present and
former directors, officers, employees and agents, and 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 each of them may sustain in any way related to any information
provided by or on behalf of the Seller regarding the Seller, the Seller's
servicing practices or performance, the Mortgage Loans or the Underwriting
Guidelines set forth in any offering document prepared in connection with any
Reconstitution. For purposes of the previous sentence, "Purchaser" shall mean
the Person then acting as the Purchaser under this Agreement and any and all
Persons who previously were "Purchasers" under this Agreement.
If the Seller is required to engage a third party to fulfill a request
pursuant to the foregoing paragraphs of this section, the Purchaser shall
reimburse the Seller for any reasonable out-of-pocket costs incurred by the
Seller with respect to such third party.
Except with respect to each MERS Designated Mortgage Loan, in the
event the Purchaser has elected to have the Interim Servicer or the Seller hold
record title to the Mortgages, prior to the Reconstitution Date, the Interim
Servicer or the Seller shall, to the extent not previously performed, prepare an
assignment of mortgage in blank or to the prospective purchaser or trustee, as
applicable, from the Interim Servicer or the Seller, as applicable, in form and
substance required by this Agreement, for each Mortgage Loan that is part of the
Reconstitution and shall pay all preparation and recording costs associated
therewith. In connection with the Reconstitution, the Interim Servicer shall
execute or shall cause the Seller to execute each such Assignment of Mortgage,
track such Assignments of Mortgage to ensure they have been recorded and deliver
them as required by the prospective purchaser or trustee, as applicable, upon
the Interim Servicer's receipt thereof.
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All Mortgage Loans not sold or transferred pursuant to a
Reconstitution shall remain subject to this Agreement and, if the Interim
Servicing Agreement shall remain in effect with respect to the related Mortgage
Loan Package, shall continue to be serviced in accordance with the terms of this
Agreement and the Interim Servicing Agreement and with respect thereto this
Agreement shall remain in full force and effect.
SECTION 14. The Seller.
Subsection 14.01. Additional Indemnification by the Seller; Third
Party Claims.
(a) The Seller shall indemnify the Purchaser and its present and
former directors, officers, employees and agents and any Successor Servicer and
its present and former directors, officers, employees and agents, and hold such
parties harmless against any and all claims, losses, damages, penalties, fines,
forfeitures, reasonable legal fees (including legal fees incurred in connection
with the enforcement of the Seller's indemnification obligation under this
Section 14.01) and related costs, judgments, and any other reasonable costs,
fees and expenses that such parties may sustain in any way related to the
failure of the Seller to perform its duties and the Interim Servicer to service
the Mortgage Loans in strict compliance with the terms of this Agreement or any
Reconstitution Agreement entered into pursuant to Section 13 or any breach of
any of Seller's representations, warranties and covenants set forth in this
Agreement (provided that such costs shall not include any lost profits). For
purposes of this paragraph "Purchaser" shall mean the Person then acting as the
Purchaser under this Agreement and any and all Persons who previously were
"Purchasers" under this Agreement and "Successor Servicer" shall mean any Person
designated as the Successor Servicer pursuant to this Agreement and any and all
Persons who previously were "Successor Servicers" pursuant to this Agreement.
(b) Promptly after receipt by an indemnified party under this Section
14.01 of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party under
this Section 14.01, notify the indemnifying party in writing of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
the indemnifying party from any liability which it may have to any indemnified
party under this Section 14.01, except to the extent that it has been prejudiced
in any material respect, or from any liability which it may have, otherwise than
under this Section 14.01. In case any such action is brought against any
indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein, and to
the extent that it may elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice from such indemnified party,
to assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party; provided that if the defendants in any such action include
both the indemnified party and the indemnifying party and the indemnified party
or parties shall have reasonably concluded that there may be legal defenses
available to it or them and/or other indemnified parties which 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 counsel, the
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indemnifying party will not be liable to such indemnified party for expenses
incurred by the indemnified party in connection with the defense thereof unless
(i) the indemnified party shall have employed separate counsel in connection
with the assertion of legal defenses in accordance with the proviso to the
preceding sentence (it being understood, however, that the indemnifying party
shall not be liable for the expenses of more than one separate counsel (together
with one local counsel, if applicable)), (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 has authorized in
writing the employment of counsel for the indemnified party at the expense of
the indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall be only in respect of the counsel referred to in such
clause (i) or (iii).
Subsection 14.02. Merger or Consolidation of the Seller.
The Seller will keep in full effect its existence, rights and
franchises as a corporation under the laws of the state of its incorporation
except as permitted herein, and will obtain and preserve its qualification to do
business as a foreign corporation 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.
Any Person into which the Seller may be merged or consolidated, or any
corporation resulting from any merger, conversion or consolidation to which the
Seller shall be a party, or any Person succeeding to the business of the Seller,
shall be the successor of the Seller 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
successor or surviving Person shall have a net worth of at least $30,000,000.
SECTION 15. Financial Statements.
The Seller understands that in connection with the Purchaser's
marketing of the Mortgage Loans, the Purchaser shall make available to
prospective purchasers audited financial statements of the Seller for the most
recently completed three (3) fiscal years respecting which such statements are
available, as well as a Consolidated Statement of Condition of the Seller at the
end of the last two (2) fiscal years covered by such Consolidated Statement of
Operations. Upon reasonable request, the Seller shall also make available any
comparable interim statements to the extent any such statements have been
prepared by the Seller (and are available upon request to members or
stockholders of the Seller or the public at large). The Seller, if it has not
already done so, agrees to furnish promptly to the Purchaser copies of the
statements specified above. The Seller shall also make available information on
its servicing performance with respect to loans serviced for others, including
delinquency ratios.
The Seller also agrees to allow reasonable access to a knowledgeable
financial or accounting officer for the purpose of answering questions asked by
any prospective purchaser regarding recent developments affecting the Seller or
the financial statements of the Seller.
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SECTION 16. Mandatory Delivery; Grant of Security Interest.
The sale and delivery on the related Closing Date of the Mortgage
Loans described on the related Mortgage Loan Schedule is mandatory from and
after the date of the execution of the related Purchase Price and Terms
Agreement, it being specifically understood and agreed that each Mortgage Loan
is unique and identifiable on the date hereof and that an award of money damages
would be insufficient to compensate the Purchaser for the losses and damages
incurred by the Purchaser (including damages to prospective purchasers of the
Mortgage Loans) in the event of the Seller's failure to deliver (i) each of the
related Mortgage Loans or (ii) one or more Qualified Substitute Mortgage Loans
or (iii) one or more Mortgage Loans otherwise acceptable to the Purchaser on or
before the related Closing Date. Immediately following the release of the lien
of the Seller's warehouse lender on each Mortgage Loan, the Seller hereby grants
to the Purchaser a lien on and a continuing security interest in each Mortgage
Loan and each document and instrument evidencing each such Mortgage Loan to
secure the performance by the Seller of its obligations under the related
Purchase Price and Terms Agreement, and the Seller agrees that it shall hold
such Mortgage Loans in custody for the Purchaser subject to the Purchaser's (i)
right to reject any Mortgage Loan (or Qualified Substitute Mortgage Loan) under
the terms of this Agreement and to require another Mortgage Loan (or Qualified
Substitute Mortgage Loan) to be substituted therefor, and (ii) obligation to pay
the Purchase Price for the Mortgage Loans. All rights and remedies of the
Purchaser under this Agreement are distinct from, and cumulative with, any other
rights or remedies under this Agreement or afforded by law or equity and all
such rights and remedies may be exercised concurrently, independently or
successively.
SECTION 17. Notices.
All demands, notices and communications hereunder shall be in writing
and shall be given via email, facsimile transmission or registered or certified
mail to the person at the address set forth below:
(i) if to the Seller:
Accredited Home Lenders, Inc.
00000 Xxxxxx xx Xxxxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxxxxx
Fax: 000-000-0000
Email: xxxxxxxxx@xxxxxxxxxx.xxx
with a copy to:
Accredited Home Lenders, Inc.
00000 Xxxxxx Xxxxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxx
Fax: 000-000-0000
Email: xxxxx@xxxxxxxxxx.xxx
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(ii) if to the Purchaser:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx Xxxxxxxx
Fax: 000-000-0000
Email: x.xxxxxxxx@xxxxxx.xxx
with a copy to:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Fax: 000-000-0000
Email: x.xxxxx@xxxxxx.xxx
or such other address as may hereafter be furnished to the other party by like
notice. Any such demand, notice or communication hereunder shall be deemed to
have been received on the date delivered to or received at the premises of the
addressee (as evidenced, in the case of registered or certified mail, by the
date noted on the return receipt).
SECTION 18. Severability Clause.
Any part, provision representation or warranty of this Agreement which
is prohibited or unenforceable or is held to be void or unenforceable in any
jurisdiction shall be ineffective, as to such jurisdiction, to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction as to any Mortgage Loan shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by applicable law, the parties hereto waive any provision of law which prohibits
or renders void or unenforceable any provision hereof. If the invalidity of any
part, provision, representation or warranty of this Agreement shall deprive any
party of the economic benefit intended to be conferred by this Agreement, the
parties shall negotiate, in good-faith, to develop a structure the economic
effect of which is nearly as possible the same as the economic effect of this
Agreement without regard to such invalidity.
SECTION 19. Counterparts.
This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original, and all such
counterparts shall constitute one and the same instrument.
SECTION 20. Governing Law Jurisdiction; Consent to Service of Process.
THIS AGREEMENT SHALL BE DEEMED IN EFFECT WHEN A FULLY EXECUTED
COUNTERPART THEREOF IS RECEIVED BY THE PURCHASER IN THE STATE OF NEW YORK AND
SHALL BE DEEMED TO HAVE BEEN MADE IN THE
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STATE OF NEW YORK. THIS AGREEMENT SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ITS CHOICE OF LAW RULES AND
PRINCIPLES. EACH OF THE PURCHASER AND THE SELLER IRREVOCABLY (I) SUBMITS TO THE
EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND THE FEDERAL
COURTS OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK FOR
THE PURPOSE OF ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT; (II) WAIVES,
TO THE FULLEST EXTENT PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT FORUM IN
ANY ACTION OR PROCEEDING IN ANY SUCH COURT; (III) AGREES THAT A FINAL JUDGMENT
IN ANY ACTION OR PROCEEDING IN ANY SUCH COURT SHALL BE CONCLUSIVE AND MAY BE
ENFORCED IN ANY OTHER JURISDICTION BY SUIT ON THE JUDGMENT OR IN ANY OTHER
MANNER PROVIDED BY LAW; AND (IV) CONSENTS TO SERVICE OF PROCESS UPON IT BY
MAILING A COPY THEREOF BY CERTIFIED MAIL ADDRESSED TO IT AS PROVIDED FOR NOTICES
HEREUNDER.
SECTION 21. Intention of the Parties.
It is the intention of the parties that the Purchaser is purchasing,
and the Seller is selling the Mortgage Loans and not a debt instrument of the
Seller or another security. Accordingly, the parties hereto each intend to treat
the transaction for federal income tax purposes as a sale by the Seller, and a
purchase by the Purchaser, of the Mortgage Loans. The Purchaser shall have the
right to review the Mortgage Loans and the related Mortgage Loan Files to
determine the characteristics of the Mortgage Loans which shall affect the
federal income tax consequences of owning the Mortgage Loans and the Seller
shall cooperate with all reasonable requests made by the Purchaser in the course
of such review.
SECTION 22. Successors and Assigns; Assignment of Purchase Agreement.
This Agreement shall bind and inure to the benefit of and be
enforceable by the Seller and the Purchaser and the respective permitted
successors and assigns of the Seller and the successors and assigns of the
Purchaser. Except as set forth under Section 14.02 above, this Agreement shall
not be assigned, pledged or hypothecated by the Seller to a third party without
the prior written consent of the Purchaser, which consent may not be
unreasonably withheld. This Agreement may be assigned, pledged or hypothecated
by the Purchaser in whole or in part, and with respect to one or more of the
Mortgage Loans, without the consent of the Seller. There shall be no limitation
on the number of assignments or transfers allowable by the Purchaser with
respect to the Mortgage Loans and this Agreement. In the event the Purchaser
assigns this Agreement, and the assignee assumes any of the Purchaser's
obligations hereunder, the Seller acknowledges and agrees to look solely to such
assignee, and not to the Purchaser, for performance of the obligations so
assumed and the Purchaser shall be relieved from any liability to the Seller
with respect thereto.
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SECTION 23. Waivers.
No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced.
SECTION 24. Exhibits.
The exhibits to this Agreement are hereby incorporated and made a part
hereof and are an integral part of this Agreement.
SECTION 25. General Interpretive 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) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;
(c) 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;
(d) 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;
(e) 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
(f) the term "include" or "including" shall mean without limitation by
reason of enumeration.
SECTION 26. Reproduction of Documents.
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications which may hereafter be
executed, (b) documents received by any party at the closing, and (c) financial
statements, certificates and other information previously or hereafter
furnished, may be reproduced by any photographic, photostatic, microfilm,
micro-card, miniature photographic or other similar process. The parties agree
that any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding, whether or not the original
is in existence and whether or not such reproduction was made by a party in the
regular course of business, and that any
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enlargement, facsimile or further reproduction of such reproduction shall
likewise be admissible in evidence.
SECTION 27. Further Agreements.
The Seller and the Purchaser each agree to execute and deliver to the
other such reasonable and appropriate additional documents, instruments or
agreements as may be necessary or appropriate to effectuate the purposes of this
Agreement.
SECTION 28. Recordation of Assignments of Mortgage.
To the extent permitted by applicable law, for Mortgage Loans which
are not registered with MERS, each of the Assignments of Mortgage is subject to
recordation in the appropriate public offices for real property records in the
county or other comparable jurisdictions in which the related Mortgaged Property
is situated, such recordation to be effected at the Seller's expense in the
event recordation is either necessary under applicable law or requested by the
Purchaser at its sole option (other than with respect to the MERS Designated
Mortgage Loans).
SECTION 29. No Solicitation.
From and after the Closing Date, the Seller agrees that it will not
take any action or permit or cause any action to be taken by any of its agents
or affiliates, or by any independent contractors on the Seller's behalf, to
personally, by telephone or mail (via electronic means or otherwise), solicit
the borrower or obligor under any Mortgage Loan for any purpose whatsoever,
including to refinance a Mortgage Loan, in whole or in part, without the prior
written consent of the Purchaser. It is understood and agreed that all rights
and benefits relating to the solicitation of any Mortgagors and the attendant
rights, title and interest in and to the list of such Mortgagors and data
relating to their Mortgages (including insurance renewal dates) shall be
transferred to the Purchaser pursuant hereto on the Closing Date and the Seller
shall take no action to undermine these rights and benefits. Notwithstanding the
foregoing, it is understood and agreed that promotions undertaken by the Seller
or any affiliate of the Seller which are directed to the general public at
large, including, without limitation, mass mailing based on commercially
acquired mailing lists, newspaper, radio and television advertisements shall not
constitute solicitation under this Section 29.
SECTION 30. Waiver of Trial by Jury.
THE SELLER AND THE PURCHASER EACH KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR RELATING TO THIS
AGREEMENT.
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SECTION 31. Compliance with Regulation AB
Subsection 31.01. Intent of the Parties; Reasonableness.
The Purchaser and the Seller acknowledge and agree that the purpose of
Section 31 of this Agreement 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 Seller 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 Seller 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.
Furthermore, the Purchaser and the Seller agree that if any such changes in the
interpretations of the requirements of Regulation AB materially affect this
Article 31, then the Purchaser and the Seller will amend such affected
provisions in accordance with this Section 31. In connection with any
Securitization Transaction, the Seller 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
Seller, 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.
The Purchaser (including any of its assignees or designees) shall
cooperate with the Seller 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.
Subsection 31.02. Additional Representations and Warranties of the
Seller.
(a) The Seller shall be deemed to represent to the Purchaser and to
any Depositor, as of the date on which information is first provided to the
Purchaser or any Depositor under Subsection 31.03 that, except as disclosed in
writing to the Purchaser or such Depositor prior to such date: (i) there are no
material legal or governmental proceedings pending (or known to be contemplated)
against the Seller or any Third-Party Originator; and (vii) there are no
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affiliations, relationships or transactions relating to the Seller 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 or any Depositor on any date
following the date on which information is first provided to the Purchaser or
any Depositor under Subsection 31.03, the Seller shall, within five (5) Business
Days following such request, confirm in writing the accuracy of the
representations and warranties set forth in paragraph (a) of this Section 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.
Subsection 31.03. Information to Be Provided by the Seller.
In connection with any Securitization Transaction the Seller shall (i)
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 to provide), in writing and in form and substance
reasonably satisfactory to the Purchaser and such Depositor, the information and
materials specified in paragraphs (a) and (b) of this Subsection, and (ii) as
promptly as practicable following notice to or discovery by the Seller, 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 (d) of this Subsection. Notwithstanding the foregoing, it
is understood and agreed that (1) the information required pursuant to Items
1103(a)(1), 1110(a) and 1119 of Regulation AB (including the information
required pursuant to subparts (a)(A), (a)(D) and (c)(i)(B) of this Subsection
33.03) shall only be required to the extent that mortgage loans originated by
the Seller or a Third Party Originator, as the case may be, in the related
Securitization Transaction comprise 10% or more (or such other percentage as may
be required from time to time under Regulation AB) of the aggregate pool of
mortgage loans in such Securitization Transaction, (2) the information required
pursuant to Items 1110(b) and 1117 of Regulation AB (including the information
required pursuant to subparts (a)(B), (a)(C) and (c)(i)(A) of this Subsection
33.03) shall only be required to the extent that mortgage loans originated by
the Seller or a Third Party Originator, as the case may be, in the related
Securitization Transaction comprise 20% or more (or such other percentage as may
be required from time to time under Regulation AB) of the aggregate pool of
mortgage loans in such Securitization Transaction and (3) the information
required pursuant to Item 1105 of Regulation AB (including the information
required pursuant to subpart (b) below) shall only be required in Securitization
Transactions in which such Static Pool Information is material, as determined by
the Purchaser or Depositor in its sole reasonable determination of the
requirements of Regulation AB. Notwithstanding the foregoing, neither the
Purchaser nor any Depositor shall exercise its right to request delivery of such
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.
(a) Subject to the provisions of the preceding paragraph, if so
requested by the Purchaser or any Depositor, the Seller shall provide such
information regarding (i) the Seller, as originator of the Mortgage Loans
(including as an acquirer of Mortgage Loans from a Qualified Correspondent), or
(ii) each Third Party Originator, as is requested for the purpose of compliance
-55-
with Items 1103(a)(1), 1105, 1110, 1117 and 1119 of Regulation AB. Such
information shall include, at a minimum.
(i) the originator's form of organization;
(ii) 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 or any Depositor, to an analysis of the
performance of the Mortgage Loans, including the originator's 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;
(iii) a description of any material legal or governmental proceedings
pending (or known to be contemplated) against the Seller and each Third
Party Originator; and
(iv) a description of any affiliation or relationship between the
Seller, each Third Party Originator and any of the following parties to a
Securitization Transaction, as such parties are identified to the Seller by
the Purchaser or any Depositor in writing in advance of such Securitization
Transaction:
(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.
(b) Subject to the provisions of the initial paragraph of this
Section, if so requested by the Purchaser or any Depositor, the Seller 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 (i) the Seller, if the Seller is an originator of Mortgage Loans
(including as an acquirer of Mortgage Loans from a Qualified Correspondent),
and/or (ii) each
-56-
Third Party Originator. Such Static Pool Information shall be prepared by the
Seller (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 Seller (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 Seller, 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.
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 Seller 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
Seller.
If so requested by the Purchaser or any Depositor, the Seller 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 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
Seller'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 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.
(c) [Reserved].
(d) Subject to the provisions of the initial paragraph of this
Section, 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 Seller shall (or shall cause each Third
Party Originator to) (i) notify the Purchaser and any Depositor in writing of
(A) any material litigation or governmental proceedings pending against the
Seller or any Third Party Originator and (B) any affiliations or relationships
that develop following the closing
-57-
date of a Securitization Transaction between the Seller or any Third Party
Originator and any of the parties specified in clause (vi) of paragraph (a) of
this Subsection (and any other parties identified in writing by the requesting
party) with respect to such Securitization Transaction, and (ii) provide to the
Purchaser and any Depositor a description of such proceedings, affiliations or
relationships.
(e) With respect to those Mortgage Loans that were sold to the
Purchaser pursuant to this Agreement, the Purchaser shall, to the extent
consistent with then-current industry practice, cause the servicer (or another
party) to be obligated to provide information, upon request by Seller in the
form customarily provided by such servicer or other party (which need not be
customized for the Seller) with respect to the Mortgage Loans reasonably
necessary for the Seller to comply with its obligations under Regulation AB,
including, without limitation, providing to the Seller Static Pool Information,
as set forth in Item 1105(a)(2) and (3) of Regulation AB (such information
provided by the servicer or such other party, the "Loan Performance
Information").
Subsection 31.04. Indemnification; Remedies.
(a) The Seller shall indemnify the Purchaser, each affiliate of the
Purchaser, the Depositor, 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:
(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 this
Section 31 by or on behalf of the Seller, or provided under this Section 31
by or on behalf of any Third Party Originator (collectively, the "Seller
Information"), or (B) the omission or alleged omission to state in the
Seller Information a material fact required to be stated in the Seller
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 Seller Information and not to any
other information communicated in connection with a sale or purchase of
securities, without regard to whether the Seller Information or any portion
thereof is presented together with or separately from such other
information;
-58-
(ii) any failure by the Seller or any Third Party Originator to
deliver any information, report, certification, accountants' letter or
other material when and as required under this Section 31; or
(iii) any breach by the Seller of a representation or warranty set
forth in Subsection 31.02(a) or in a writing furnished pursuant to
Subsection 31.02(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 Seller of a representation
or warranty in a writing furnished pursuant to Subsection 31.02(b) to the
extent made as of a date subsequent to such closing date.
(b) In the case of any failure of performance described in clause
(a)(ii) of this Section, the Seller 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 Seller or
any Third Party Originator.
(c) The Purchaser shall indemnify the Seller, each affiliate of the
Seller and the respective present and former directors, officers, employees and
agents of each of the foregoing, 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:
(i) (A) any untrue statement of a material fact contained or alleged
to be contained in the Loan Performance Information or (B) the omission or
alleged omission to state in the Loan Performance Information a material
fact required to be stated in the Loan Performance 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 Loan Performance Information and not to any other
information communicated in connection with a sale or purchase of
securities, without regard to whether the Loan Performance Information or
any portion thereof is presented together with or separately from such
other information; or
(ii) any failure by the Purchaser or by the related servicer to
deliver any Loan Performance Information as required under Subsection
31.03(e).
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
-59-
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed hereto by their respective officers thereunto duly
authorized as of the date first above written.
IXIS REAL ESTATE CAPITAL INC.
(Purchaser)
By: /s/ Xxxxx Xxxxx
-----------------------------------
Name: Xxxxx Xxxxx
Title: Director
By: /s/ F. Xxxx Xxxxxx
-----------------------------------
Name: F. Xxxx Xxxxxx
Title: Managing Director
ACCREDITED HOME LENDERS, INC.
(Seller)
By: /s/ Xxxx Xxxxxxx
-----------------------------------
Name: Xxxx Xxxxxxx
Title: Secondary Marketing Manager
-60-
Exhibit A
EXHIBIT A
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 delivered to the
Custodian, or to such other Person as the Purchaser shall designate in writing,
pursuant to Section 6 of the Third Amended and Restated Mortgage Loan Purchase
and Warranties Agreement to which this Exhibit is attached (the "Agreement"):
(a) the original Mortgage Note bearing all intervening endorsements
evidencing a complete chain of assignment from the originator to the Seller,
endorsed "Pay to the order of _________, without recourse" and signed in the
name of the Seller by an authorized officer. To the extent that there is no room
on the face of the Mortgage Notes for endorsements, the endorsement may be
contained on an allonge, if state law so allows and the Custodian is so advised.
If the Mortgage Loan was acquired by the Seller in a merger, the endorsement
must be by "[Seller], successor by merger to [name of predecessor]." If the
Mortgage Loan was acquired or originated by the Seller while doing business
under another name, the endorsement must be by "[Seller], formerly known as
[previous name]";
(b) the original of any guarantee executed in connection with the
Mortgage Note;
(c) the original Mortgage with evidence of recording thereon;
(d) the originals of all assumption, modification, consolidation or
extension agreements, if any, with evidence of recording thereon;
(e) except with respect to each MERS Designated Mortgage Loan, the
original Assignment of Mortgage for each Mortgage Loan, in form and substance
acceptable for recording. The Assignment of Mortgage must be duly recorded only
if recordation is either necessary under applicable law or commonly required by
private institutional mortgage investors in the area where the Mortgaged
Property is located or on direction of the Purchaser as provided in this
Agreement. If the Assignment of Mortgage is to be recorded, the Mortgage shall
be assigned to the Purchaser. If the Assignment of Mortgage is not to be
recorded, the Assignment of Mortgage shall be delivered in blank. If the
Mortgage Loan was acquired by the Seller in a merger, the Assignment of Mortgage
must be made by "[Seller], successor by merger to [name of predecessor]". If the
Mortgage Loan was acquired or originated by the Seller while doing business
under another name, the Assignment of Mortgage must be by "[Seller], formerly
known as [previous name]";
(f) the originals of all intervening assignments of mortgage,
evidencing a complete chain of assignment from the originator to the Seller (or
MERS with respect to each MERS Designated Mortgage Loan), with evidence of
recording thereon;
A-1
(g) the original mortgagee policy of title insurance or, in the event
such original title policy is unavailable, a true copy of the related policy
binder, preliminary report or commitment for title; and
(h) any security agreement, chattel mortgage or equivalent document
executed in connection with the Mortgage.
Notwithstanding the foregoing, in connection with any item described
above in clauses (c) or (f), if the Seller cannot deliver or cause to be
delivered the original of any such item with evidence of recording thereon on or
prior to the related Closing Date because of a delay caused by the public
recording office where such item has been delivered for recordation or because
such item has been lost or because such public recording office retains the
original recorded item (each such item, a "Delayed Document"), the Seller shall
deliver or cause to be delivered to the Custodian, (i) in the case of a delay
caused by the public recording office, a photocopy of such Delayed Document,
together with an Officer's Certificate of the Seller (or certified by the title
company, escrow agent, or closing attorney) to the effect that such copy is a
true and correct copy of the Delayed Document that has been dispatched to the
appropriate public recording office for recordation (and the original recorded
Delayed Document or a copy of such Delayed Document certified by such public
recording office to be a true and complete copy of the original recorded Delayed
Document will be promptly delivered to the Custodian upon receipt thereof by the
Seller); or (ii) in the case of a Delayed Document where a public recording
office retains the original recorded Delayed Document or in the case where a
Delayed Document is lost after recordation in a public recording office, a copy
of such Delayed Document certified by such public recording office to be a true
and complete copy of the original recorded Delayed Document.
In the event of a delay caused by the public recording office in
returning any recorded document, the Seller shall deliver to the Purchaser,
within ninety (90) days of the 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; provided, however, that any recorded document shall
in any event be delivered no later than one (1) year from the applicable Closing
Date. An extension of the date specified in (iv) above may be requested from the
Purchaser, which consent shall not be unreasonably withheld.
A-2
Exhibit B
EXHIBIT B
[RESERVED]
B-1
Exhibit C
EXHIBIT C
FORM OF SELLER'S OFFICER'S CERTIFICATE
I, ____________________, hereby certify that I am the duly elected
[Executive/Assistant] [Vice] President of Accredited Home Lenders, Inc., a state
chartered institution organized under the laws of the [State of ____________]
(the "Company"), and further as follows:
1. Attached hereto as Exhibit 1 is a true, correct and complete copy
of the charter of the Company which is in full force and effect on the date
hereof without amendment, waiver, rescission or modification.
2. Attached hereto as Exhibit 2 is a true, correct and complete copy
of the bylaws of the Company which are in effect on the date hereof without
amendment, waiver, rescission or modification.
3. Attached hereto as Exhibit 3 is an original certificate of good
standing of the Company issued within ten (10) days of the date hereof, and
no event has occurred since the date thereof which would impair such
standing.
4. Attached hereto as Exhibit 4 is a true, correct and complete copy
of the corporate resolutions of the Board of Directors of the Company
authorizing the Company to execute and deliver agreements such as the Third
Amended and Restated Mortgage Loan Purchase and Warranties Agreement, dated
as of August 1, 2006, by and between IXIS Real Estate Capital Inc. (the
"Purchaser") and the Company (the "Purchase Agreement"), the Interim
Servicing Agreement, dated as of October 1, 2003, by and between the
Company and the Purchaser (the "Interim Servicing Agreement") and to
endorse the Mortgage Notes and execute the Assignments of Mortgages by
original signature, and such resolutions are in effect on the date hereof
without amendment, waiver, rescission or modification.
5. 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 Purchase Agreement, the Interim Servicing Agreement, the sale of
the mortgage loans or the consummation of the transactions contemplated by
the agreements; or (ii) any required consent, approval, authorization or
order has been obtained by the Company.
6. Neither the consummation of the transactions contemplated by, nor
the fulfillment of the terms of the Purchase Agreement and the Interim
Servicing Agreement conflicts or will conflict with or results or will
result in a material breach of or constitutes or will constitute a material
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 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.
C-1
7. To the best of my knowledge, except as disclosed in filings with
the Securities Exchange Commission by the Seller or its Affiliates, there
is no action, suit, proceeding or investigation pending or threatened
against the Company which, in my judgment, 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 Purchase Agreement and the Interim Servicing Agreement, or the mortgage
loans or of any action taken or to be taken in connection with the
transactions contemplated hereby, or which would be likely to impair
materially the ability of the Company to perform under the terms of the
Purchase Agreement and the Interim Servicing Agreement.
8. Each person listed on Exhibit 5 attached hereto who, as an officer
or representative of the Company, signed (a) the Purchase Agreement, (b)
the Interim Servicing Agreement and (c) any other document delivered before
or on the date hereof in connection with any purchase described in the
agreements set forth above, other than endorsements of Mortgage Notes, was,
at the respective times of such signing and delivery, a duly elected or
appointed, qualified and acting officer or representative of the Company,
who holds the office set forth opposite his or her name on Exhibit 5, and
the signatures of such persons appearing on such documents are their
genuine signatures.
9. The Company is duly authorized to engage in the transactions
described and contemplated in the Purchase Agreement and the Interim
Servicing Agreement.
C-2
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the
seal of the Company.
Dated: ________________ By:
------------------------------------------
Name:
---------------------------------------
[Seal] Title: [Executive/Assistant] [Vice] President
I, ________________________, an [Assistant] Secretary of Accredited
Home Lenders, Inc., hereby certify that ____________ is the duly elected,
qualified and acting [Vice] President of the Company and that the signature
appearing above is [her] [his] genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated:_______________________ By:
-----------------------------------------
Name:
----------------------------------------
Title: [Assistant] Secretary
C-3
EXHIBIT 5 to
Company's Officer's Certificate
NAME TITLE SIGNATURE
------------------------ ------------------------ ------------------------
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
C-4
Exhibit D
EXHIBIT D
FORM OF OPINION OF COUNSEL TO THE SELLER
AND INTERIM SERVICER (DATE)
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
You have requested [our] [my] opinion, as [Assistant] General Counsel
to Accredited Home Lenders, Inc. (the "Company"), with respect to certain
matters in connection with the sale by the Company of the Mortgage Loans
pursuant to that certain Third Amended and Restated Mortgage Loan Purchase and
Warranties Agreement by and between the Company and IXIS Real Estate Capital
Inc. (the "Purchaser"), dated as of August 1, 2006 (the "Purchase Agreement")
which sale is in the form of whole loans, and serviced pursuant to an Interim
Servicing Agreement, dated as of October 1, 2003 by and between the Interim
Servicer and the Purchaser (the "Interim Servicing Agreement" and, collectively
with the Purchase Agreement, the "Agreements"). Capitalized terms not otherwise
defined herein have the meanings set forth in the Purchase Agreement and the
Interim Servicing Agreement.
[We] [I] have examined the following documents:
1. the Purchase Agreement;
2. the Interim Servicing Agreement;
3. the form of Assignment of Mortgage [for a Mortgage Loan secured
by a Mortgaged Property located in the State of California];
4. the form of endorsement of the Mortgage Notes; and
5. such other documents, records and papers as we have deemed
necessary and relevant as a basis for this opinion.
To the extent [we] [I] have deemed necessary and proper, [we] [I] have
relied upon the representations and warranties of the Company and the Interim
Servicer contained in the Purchase Agreement and in the Interim Servicing
Agreement, as applicable. [We] [I] have assumed the authenticity of all
documents submitted to [us] [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 [our] [my] opinion that:
1. The Company and the Interim Servicer is a corporation duly organized,
validly existing and in good standing under the laws of the United
States and is qualified
D-1
to transact business in, and is in good standing under, the laws of
the State of California.
2. Each of the Company and the Interim Servicer has the power to engage
in the transactions contemplated by the Agreements to which it is a
party and all requisite power, authority and legal right to execute
and deliver such Agreements and to perform and observe the terms and
conditions of such Agreements.
3. Each of the Agreements to which it is a party has been duly
authorized, executed and delivered by the Company and the Interim
Servicer, as applicable, and is a legal, valid and binding agreement
enforceable in accordance with its respective terms against the
Company and the Interim Servicer, as applicable, subject to bankruptcy
laws and other similar laws of general application affecting rights of
creditors 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.
4. Each of the Company and the Interim Servicer has been duly authorized
to allow certain of its officers to execute any and all documents by
original signature in order to complete the transactions contemplated
by the Agreements to which it is a party and to execute the
endorsements to the Mortgage Notes and the Assignments of Mortgages,
and the original [or facsimile] signature of the officers of the
Company executing the endorsements to the Mortgage Notes and any
Assignments of Mortgages represents the legal and valid signatures of
said officers of the Company.
5. 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 or the Interim Servicer of or
compliance by the Company or the Interim Servicer with the Agreements
to which it is a party and the sale of the Mortgage Loans by the
Company or the consummation of the transactions contemplated by the
Agreements to which each is a party or (ii) any required consent,
approval, authorization or order has been obtained by the Company or
the Interim Servicer.
6. Neither the consummation of the transactions contemplated by, nor the
fulfillment of the terms of, the Agreements to which it is a party
conflicts or will conflict with or results or will result in a
material breach of or constitutes or will constitute a material
default under the charter, by-laws or other organizational documents
of the Company or the Interim Servicer, as applicable, the terms of
any indenture or other agreement or instrument to which the Company or
the Interim Servicer 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 or the Interim Servicer is
subject or by which it is bound.
D-2
7. Except as disclosed in filings with the Securities Exchange Commission
by the Company or its Affiliates, there is no action, suit, proceeding
or investigation pending or, to my knowledge, threatened against the
Company or the Interim Servicer which, in [our] [my] judgment, 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 the Interim Servicer or in any
material impairment of the right or ability of the Company or the
Interim Servicer to carry on its business substantially as now
conducted or in any material liability on the part of the Company or
the Interim Servicer or which would draw into question the validity of
the Agreements to which it is a party or the Mortgage Loans or of any
action taken or to be taken in connection with the transactions
contemplated thereby, or which would be likely to impair the ability
of the Company or the Interim Servicer to perform under the terms of
the Agreements to which it is a party.
8. The sale of each Mortgage Note and Mortgage as and in the manner
contemplated by the Agreements is sufficient to fully transfer to the
Purchaser all right, title and interest of the Company thereto as
noteholder and mortgagee.
9. The endorsement of the Mortgage Notes, the delivery to the Purchaser,
or its designee, of any Assignments of Mortgage, the transfer to the
Purchaser, or its designee, in the MERS System of beneficial ownership
of each MERS Designated Mortgage Loan, and the delivery of the
original endorsed Mortgage Notes to the Purchaser, or its designee,
are sufficient to permit the Purchaser to avail itself of all
protection available under applicable law against the claims of any
present or future creditors of the Company, and are sufficient to
prevent any other sale, transfer, assignment, pledge or hypothecation
of the Mortgages and the Mortgage Notes by the Company from being
enforceable.
I am admitted to the bar of the State of California, and I express no
opinion as to the laws of any other jurisdiction except as to matters that are
governed by federal law. 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. I make no
undertaking to supplement or update this opinion if, after the date hereof,
facts or circumstances come to my attention or changes in the law occur which
could affect such opinion.
Very truly yours,
---------------------------------------
[Name]
[Assistant] General Counsel
D-3
Exhibit E
EXHIBIT E
FORM OF SECURITY RELEASE CERTIFICATION
________________, ____
________________________
________________________
________________________
Attention: ____________________________
____________________________
Re: Notice of Sale and Release of Collateral
Dear Sirs:
This letter serves as notice that Accredited Home Lenders, Inc., a
corporation organized pursuant to the laws of the State of California (the
"Company") has committed to sell to IXIS Real Estate Capital Inc. under an Third
Amended and Restated Mortgage Loan Purchase and Warranties Agreement, dated as
of August 1, 2006, certain mortgage loans originated by the Company. The Company
warrants that the mortgage loans to be sold to IXIS Real Estate Capital Inc. are
in addition to and beyond any collateral required to secure advances made by you
to the Company.
The Company acknowledges that the mortgage loans to be sold to IXIS
Real Estate Capital Inc. shall not be used as additional or substitute
collateral for advances made by [____________]. IXIS Real Estate Capital Inc.
understands that the balance of the Company's mortgage loan portfolio may be
used as collateral or additional collateral for advances made by [___________],
and confirms that it has no interest therein.
E-1
Execution of this letter by [___________] shall constitute a full and
complete release of any security interest, claim, or lien which [___________]
may have against the mortgage loans to be sold to IXIS Real Estate Capital Inc.
Very truly yours,
---------------------------------------
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Date:
----------------------------------
Acknowledged and approved:
---------------------------------------
By:
-----------------------------------
Name:
----------------------------------
Title:
---------------------------------
Date:
---------------------------------
E-2
Exhibit F
EXHIBIT F
FORM OF SECURITY RELEASE CERTIFICATION
I. Release of Security Interest
Upon receipt of the sum of $________ in immediately available funds in
accordance with wiring instructions separately provided, the financial
institution named below hereby relinquishes any and all right, title and
interest it may have in the Mortgage Loans identified in the attached schedule
to be purchased by IXIS Real Estate Capital Inc. from Accredited Home Lenders,
Inc. (the "Company"), and certifies that all notes, mortgages, assignments and
other documents in its possession relating to such Mortgage Loans have been
delivered and released to the Company named below or its designees, as of the
date and time of the sale of such Mortgage Loans to IXIS Real Estate Capital
Inc.
Name and Address of Financial Institution
--------------------------------
(Name)
--------------------------------
(Address)
By:-----------------------------
F-1
II. Certification of Release
The Company named below hereby certifies to IXIS Real Estate Capital
Inc. that, as of the date and time of the sale of the above-mentioned Mortgage
Loans to IXIS Real Estate Capital Inc., the security interests in the Mortgage
Loans released by the above-named financial institution comprise all security
interests relating to or affecting any and all such Mortgage Loans. The Company
warrants that, as of such time, there are and will be no other security
interests affecting any or all of such Mortgage Loans.
---------------------------------------
By:
------------------------------------
Title:
---------------------------------
Date:
----------------------------------
F-2
Exhibit G
EXHIBIT G
[RESERVED]
G-1
Exhibit I
EXHIBIT H
ASSIGNMENT AND CONVEYANCE
On this ___ day of __________, ____, ___________________ ("Seller"),
as (i) the Seller under that certain Purchase Price and Terms Agreement, dated
as of ___________, _____ (the "PPTA"), (ii) the Seller under that certain Third
Amended and Restated Mortgage Loan Purchase and Warranties Agreement, dated as
of August 1, 2006 (the "Purchase Agreement") and (iii) the Seller/Interim
Servicer under that certain Interim Servicing Agreement, dated as of October 1,
2003 (the "Interim Servicing Agreement" and, together with the PPTA and the
Purchase Agreement, the "Agreements") does hereby sell, transfer, assign, set
over and convey to IXIS Real Estate Capital Inc. ("Purchaser") as the Purchaser
under the Agreements, 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"), together with the Mortgage Files and all rights and obligations arising
under the documents contained therein. Each Mortgage Loan subject to the
Agreements was underwritten in accordance with, and conforms to, the
Underwriting Guidelines attached hereto as Exhibit C. Pursuant to Section 6 of
the Purchase Agreement, the Seller has delivered to the Custodian the documents
for each Mortgage Loan to be purchased as set forth in the Purchase Agreement.
The contents of each Servicing File required to be retained by Accredited Home
Lenders, Inc. ("Interim Servicer") to service the Mortgage Loans pursuant to the
Interim Servicing Agreement and thus not delivered to the Purchaser are and
shall be held in trust by the Seller in its capacity as Interim Servicer for the
benefit of the Purchaser as the owner thereof. The Interim Servicer's possession
of any portion of the Servicing File is at the will of the Purchaser for the
sole purpose of facilitating servicing of the related Mortgage Loan pursuant to
the Interim Servicing Agreement, and such retention and possession by the
Interim Servicer shall be in a custodial capacity only. The ownership of each
Mortgage Note, Mortgage, the Servicing Rights and the contents of the Mortgage
File and Servicing File is vested 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 Seller or the Interim Servicer shall
immediately vest in the Purchaser and shall be retained and maintained, in
trust, by the Seller at the will of the Purchaser in such custodial capacity
only.
The Mortgage Loan Package characteristics of the Mortgage Loans
subject hereto are set forth on Exhibit B hereto.
In accordance with Section 6 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]
H-1
ACCREDITED HOME LENDERS, INC.
By: -----------------------------------
Name:
Title:
Accepted and Agreed:
IXIS REAL ESTATE CAPITAL INC.
By: -----------------------------------
Name:
Title:
By: -----------------------------------
Name:
Title:
H-2
EXHIBIT A
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
THE MORTGAGE LOANS
H-3
EXHIBIT B
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE POOL
CHARACTERISTICS OF EACH MORTGAGE LOAN PACKAGE
Pool Characteristics of the Mortgage Loan Package as delivered on the
related Closing Date:
No Mortgage Loan has: (1) an outstanding principal balance less than
$_________; (2) an origination date earlier than _ months prior to the related
Cut-off Date; (3) a CLTV of greater than _____%; (4) a FICO Score of less than
___; or (5) a debt-to-income ratio of more than __%. Each First Lien Loan has a
Mortgage Interest Rate of at least ___% per annum and an outstanding principal
balance less than $_________. Each Second Lien Loan has a Mortgage Interest Rate
of at least ______% per annum and an outstanding principal balance less than
$________. Each Adjustable Rate Mortgage Loan has an Index of [_______].
H-4
EXHIBIT C
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
UNDERWRITING GUIDELINES
H-5
EXHIBIT I
FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated [____________ __,
20__] ("Agreement"), among IXIS Real Estate Capital Inc. ("Assignor"),
[____________________] ("Assignee") and Accredited Home Lenders, Inc. (the
"Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and
assigns to the Assignee all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain Third Amended
and Restated Mortgage Loan Purchase and Warranties Agreement (the "Purchase
Agreement"), dated as of August 1, 2006, between the Assignor, as purchaser (the
"Purchaser"), and the Company, as seller, solely insofar as the Purchase
Agreement relates to the Mortgage Loans.
The Assignor specifically reserves and does not assign to the Assignee
hereunder (i) any and all right, title and interest in, to and under and any
obligations of the Assignor with respect to any mortgage loans subject to the
Purchase Agreement which are not the Mortgage Loans set forth on the Mortgage
Loan Schedule and are not the subject of this Agreement or (ii) the rights of
the Purchaser under Section 9.04 of the Purchase Agreement.
Recognition of the Company
2. From and after the date hereof (the "Securitization Closing
Date"), the Company shall and does hereby recognize that the Assignee will
transfer the Mortgage Loans and assign its rights under the Purchase Agreement
(solely to the extent set forth herein) and this Agreement to
[__________________] (the "Trust") created pursuant to a Pooling and Servicing
Agreement, dated as of [______], 200[_] (the "Pooling Agreement"), among the
Assignee, the Assignor, [___________________], as trustee (including its
successors in interest and any successor trustees under the Pooling Agreement,
the "Trustee"), [____________________], as servicer (including its successors in
interest and any successor servicer under the Pooling Agreement, the
"Servicer"). The Company hereby acknowledges and agrees that from and after the
date hereof (i) the Trust will be the owner of the Mortgage Loans, (ii) the
Company shall look solely to the Trust for performance of any obligations of the
Assignor insofar as they relate to the Mortgage Loans, (iii) the Trust
(including the Trustee and the Servicer acting on the Trust's behalf) shall have
all the rights and remedies available to the Assignor, insofar as they relate to
the Mortgage Loans, under the Purchase Agreement, including, without limitation,
the enforcement of the document delivery requirements set forth in Section 6 of
the Purchase Agreement, and shall be entitled to enforce all of the obligations
of the Company thereunder
I-1
insofar as they relate to the Mortgage Loans, and (iv) all references to the
Purchaser, the Custodian or the Bailee under the Purchase Agreement insofar as
they relate to the Mortgage Loans, shall be deemed to refer to the Trust
(including the Trustee and the Servicer acting on the Trust's behalf). Neither
the Company nor the Assignor shall amend or agree to amend, modify, waiver, or
otherwise alter any of the terms or provisions of the Purchase Agreement which
amendment, modification, waiver or other alteration would in any way affect the
Mortgage Loans or the Company's performance under the Purchase Agreement with
respect to the Mortgage Loans without the prior written consent of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the
Assignee and the Trust as of the date hereof that:
(a) The Company is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver and
perform its obligations under this Agreement and has full power and
authority to perform its obligations under the Purchase Agreement. The
execution by the Company of this Agreement is in the ordinary course of the
Company's business and will not conflict with, or result in a breach of,
any of the terms, conditions or provisions of the Company's charter or
bylaws or any legal restriction, or any material agreement or instrument to
which the Company is now a party or by which it is bound, or result in the
violation of any law, rule, regulation, order, judgment or decree to which
the Company or its property is subject. The execution, delivery and
performance by the Company of this Agreement have been duly authorized by
all necessary corporate action on part of the Company. This Agreement has
been duly executed and delivered by the Company, and, upon the due
authorization, execution and delivery by the Assignor and the Assignee,
will constitute the valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization, insolvency,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and by general principles of equity regardless
of whether enforceability is considered in a proceeding in equity or at
law;
(c) Except as has already been obtained, no consent, approval, order or
authorization of, or declaration, filing or registration with, any
governmental entity is required to be obtained or made by the Company in
connection with the execution, delivery or performance by the Company of
this Agreement; and
(d) Except as disclosed in public filings with the Securities Exchange
Commission by the Company or its affiliates, there is no action, suit,
proceeding or investigation pending or threatened against the Company,
before any court, administrative agency or other tribunal, which would draw
into question the validity of this Agreement or the Purchase Agreement, or
which, either in any one instance or in the aggregate, would result in any
material adverse change in the ability of the Company to perform its
obligations under this Agreement or the Purchase Agreement, and the Company
is solvent.
I-2
4. Pursuant to Section 13 of the Purchase Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust, that the representations and warranties set forth in Subsection
9.01 of the Purchase Agreement are true and correct as of the date hereof as if
such representations and warranties were made on the date hereof, and that the
representations and warranties set forth on Exhibit B attached hereto are true
and correct as of the date or dates set forth thereon.
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee and
the Servicer acting on the Trust's behalf) in connection with any breach of the
representations and warranties made by the Company set forth in Sections 3 and 4
hereof shall be as set forth in Subsection 9.03 of the Purchase Agreement as if
they were set forth herein (including without limitation the repurchase and
indemnity obligations set forth therein).
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced, with the prior
written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors and
assigns of the parties hereto and (ii) the Trust (including the Trustee and the
Servicer acting on the Trust's behalf). Any entity into which Assignor, Assignee
or Company may be merged or consolidated shall, without the requirement for any
further writing, be deemed Assignor, Assignee or Company, respectively,
hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive the
conveyance of the Mortgage Loans and the assignment of the Purchase Agreement
(to the extent assigned hereunder) by Assignor to Assignee and by Assignee to
the Trust and nothing contained herein shall supersede or amend the terms of the
Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
I-3
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
ACCREDITED HOME LENDERS, INC.
By:
-------------------------------------
Name:
-----------------------------------
Its:
------------------------------------
IXIS REAL ESTATE CAPITAL INC.
By:
-------------------------------------
Name:
-----------------------------------
Its:
------------------------------------
By:
-------------------------------------
Name:
-----------------------------------
Its:
------------------------------------
[ASSIGNEE]
By:
-------------------------------------
Name:
-----------------------------------
Its:
------------------------------------
I-4
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
MORTGAGE LOAN SCHEDULE
I-5
EXHIBIT B TO ASSIGNMENT AND RECOGNITION AGREEMENT
REPRESENTATIONS AND WARRANTIES AS TO THE MORTGAGE LOANS
The Company hereby represents and warrants as to each Mortgage Loan,
as of the date on which the Company transferred servicing of the Mortgage Loan
to the Purchaser, or its designee (the "Servicing Transfer Date"), unless
otherwise set forth below:
(a) [Reserved];
(b) Payments Current. Except as set forth on the Mortgage Loan
Schedule delivered to the Purchaser by the Company on the Servicing Transfer
Date, no payment required to be made up to the Transfer Date under the Mortgage
Loan is 30 days or more delinquent nor has any payment under the Mortgage Loan
been 30 days or more delinquent at any time since the origination of the
Mortgage Loan;
(c) No Outstanding Charges. Except as set forth on the Mortgage
Loan Schedule delivered to the Purchaser by the Company on the Servicing
Transfer Date, to the Company's knowledge as of the Servicing Transfer Date
there are no defaults in complying with the terms of the Mortgage securing the
Mortgage Loan, and all taxes, governmental assessments, insurance premiums,
water, sewer and municipal charges, leasehold payments or ground rents which
previously became due and owing have been paid, or an escrow of funds has been
established in an amount sufficient to pay for every such item which remains
unpaid and which has been assessed but is not yet due and payable. As of the
closing date for the Securitization Transaction (the "Securitization Closing
Date"), except for (A) payments in the nature of escrow payments and (B)
interest accruing from the date of the Mortgage Note or date of disbursement of
the Mortgage Loan proceeds, whichever is earlier to the day which precedes by
one month the Due Date of the first installment of principal and/or interest,
including, without limitation, taxes and insurance payments, the Company has not
advanced funds, or induced, solicited or knowingly received any advance of funds
by a party other than the Mortgagor, directly or indirectly, for the payment of
any amount required under the Mortgage Loan;
(d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any respect,
from the date of origination 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 Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. As 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, and which assumption agreement is part of the Mortgage File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the Mortgage Loan
Schedule;
(e) 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
I-6
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, and no Mortgagor was a debtor in
any state or federal bankruptcy or insolvency proceeding at, or subsequent to,
the time the Mortgage Loan was funded;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are customary in the area where the Mortgaged Property
is located, as well as all additional requirements set forth in Section 2.10 of
the Interim Servicing Agreement. If required by the National Flood Insurance Act
of 1968, as amended, each Mortgage Loan is covered by a flood insurance policy
meeting the requirements of the current guidelines of the Federal Insurance
Administration in effect, as well as all additional requirements set forth in
Section 2.10 of the Interim Servicing Agreement. All individual insurance
policies contain a standard mortgagee clause naming the Company and its
successors and assigns as mortgagee, and all premiums thereon have been paid and
such policies may not be reduced, terminated or cancelled without 30 days' prior
written notice to the mortgagee. The Mortgage obligates the Mortgagor thereunder
to maintain the hazard insurance policy at the Mortgagor's cost and expense, and
on the Mortgagor's failure to do so, authorizes the holder of the Mortgage to
obtain and maintain such insurance at such Mortgagor's cost and expense, and to
seek reimbursement therefor from the Mortgagor. Where required by state law or
regulation, the Mortgagor has been given an opportunity to choose the carrier of
the required hazard insurance, provided the policy is not a "master" or
"blanket" hazard insurance policy covering a condominium, or any hazard
insurance policy covering the common facilities of a planned unit development.
The hazard insurance policy is the valid and binding obligation of the insurer,
is in full force and effect, and will be in full force and effect and inure to
the benefit of the Purchaser upon the consummation of the purchase transactions
contemplated by this Agreement. As of the Securitization Closing Date, the
Company has not engaged in, and has no knowledge of the Mortgagor's or any
servicer's having engaged in, any act or omission which would impair the
coverage of any such policy, the benefits of the endorsement provided for
herein, or the validity and binding effect of such policy, including, without
limitation, no unlawful fee, commission, kickback or other unlawful compensation
or value of any kind has been or will be received, retained or realized by any
attorney, firm or other person or entity, and no such unlawful items have been
received, retained or realized by the Company;
(g) Compliance with Applicable Laws. As of the Securitization
Closing Date, 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, predatory and abusive lending, equal
credit opportunity and disclosure laws applicable to the Mortgage Loan,
including, without limitation, any provisions relating to Prepayment Charges,
have been complied with, the consummation of the transactions contemplated
hereby will not involve the violation of any such laws or regulations, 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. Notwithstanding the foregoing, the
Company shall not be responsible for a breach of a federal, state or local law,
other than those
I-7
governing (i) the origination and (ii) servicing of the Mortgage Loans by the
Company during the interim servicing period, following the Transfer Date;
(h) No Satisfaction of Mortgage. The Mortgage has not been
satisfied, canceled, subordinated (except to a senior mortgage in the case of a
Second Lien Loan) 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 release,
cancellation, subordination or rescission. The Company has not waived the
performance by the Mortgagor of any action, if the Mortgagor's failure to
perform such action would cause the Mortgage Loan to be in default, nor has the
Company waived any default resulting from any action or inaction by the
Mortgagor;
(i) Location and Type of Mortgaged Property. The Mortgaged
Property is a fee simple property located in the state identified in the related
Mortgage Loan Schedule, except that with respect to real property located in
jurisdictions in which the use of leasehold estates for residential properties
is a widely-accepted practice, the Mortgaged Property may be a leasehold estate,
and consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a condominium project, or an individual unit in
a planned unit development; provided, however, that no residence or dwelling is
a mobile home and any condominium unit or planned unit development shall not
fall within any of the "Ineligible Projects" of part XII, Section 102 of the
Xxxxxx Xxx Selling Guide and shall conform with the Underwriting Guidelines. In
the case of any Mortgaged Properties that are manufactured homes (a
"Manufactured Home Mortgage Loans"), (i) such Manufactured Home Mortgage Loan
conforms with the applicable Xxxxxx Mae or Xxxxxxx Mac requirements regarding
mortgage loans related to manufactured dwellings, (ii) the related manufactured
dwelling is permanently affixed to the land, (iii) the related manufactured
dwelling and the related land are subject to a Mortgage properly filed in the
appropriate public recording office and naming Company as mortgagee, (iv) the
applicable laws of the jurisdiction in which the related Mortgaged Property is
located will deem the manufactured dwelling located on such Mortgaged Property
to be a part of the real property on which such dwelling is located, and (v)
such Manufactured Home Mortgage Loan is (x) a qualified mortgage under Section
860G(a)(3) of the Internal Revenue Code of 1986, as amended and (y) secured by
manufactured housing treated as a single family residence under Section
25(e)(10) of the Code. As of the date of origination, no portion of the
Mortgaged Property was used for commercial purposes, and, to the Company's
knowledge as of the Servicing Transfer Date, no portion of the Mortgaged
Property has been used for commercial purposes; provided, that Mortgaged
Properties which contain a home office shall not be considered as being used for
commercial purposes as long as the Mortgaged Property has not been altered for
commercial purposes and is not storing any chemicals or raw materials other than
those commonly used for homeowner repair, maintenance and/or household purposes;
(j) Valid First and Second Lien. Each Mortgage is a valid and
subsisting first lien, with respect to First Lien Loans, or second lien, with
respect to Second Lien Loans, of record on a single parcel of real estate
constituting the Mortgaged Property, including all buildings and improvements 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,
subject in all cases to
I-8
the exceptions to title set forth in the title insurance policy with respect to
the related Mortgage Loan, which exceptions are generally acceptable to prudent
mortgage lending companies, and such other exceptions to which similar
properties are commonly subject and which do not individually, or in the
aggregate, materially and adversely affect the benefits of the security intended
to be provided by such Mortgage. In no event shall any Mortgage Loan be in a
lien position more junior than a second lien. The lien of the Mortgage is
subject only to:
(i) with respect to Second Lien Loans, the lien of the first
mortgage on the Mortgaged Property;
(ii) the lien of current real property taxes and assessments not
yet due and payable;
(iii)covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the
date of recording acceptable to prudent mortgage lending
institutions generally and specifically referred to in the
lender's title insurance policy delivered to the originator
of the Mortgage Loan and (a) specifically referred to or
otherwise considered in the appraisal made for the
originator of the Mortgage Loan or (b) which do not
adversely affect the Appraised Value of the Mortgaged
Property set forth in such appraisal; 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.
Any security agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates a valid,
subsisting, enforceable (subject to bankruptcy, insolvency and similar laws
affecting the rights of creditors and general principles of equity) and
perfected (A) first lien and first priority security interest with respect to
each First Lien Loan, or (B) second lien and second priority security interest
with respect to each Second Lien Loan, in either case, on the property described
therein and Company has full right to sell and assign the same to Purchaser.
With respect to each Second Lien Loan, the Mortgaged Property was not, as of the
date of origination of such Second Lien Loan, subject to a mortgage, deed of
trust, deed to secure debt or other security instrument creating a lien
subordinate to the lien of the Mortgage;
(k) Validity of Mortgage Documents. The Mortgage Note and the Mortgage
and any other agreement executed and delivered by a Mortgagor or guarantor, if
applicable, in connection with a Mortgage Loan are genuine, and each is the
legal, valid and binding obligation of the maker thereof enforceable in
accordance with its terms, subject to bankruptcy, insolvency and similar laws
affecting the rights of creditors and general principles of equity (including,
I-9
without limitation, any provisions therein relating to Prepayment Charges). All
parties to the Mortgage Note, the Mortgage and any other such related agreement
had legal capacity to enter into the Mortgage Loan and to execute and deliver
the Mortgage Note, the Mortgage and any other related agreement, and the
Mortgage Note, the Mortgage and any other such related agreement have been duly
and properly executed by other such related parties. The documents, instruments
and agreements submitted for loan underwriting were not falsified and contain no
untrue statement of material fact or omit to state a material fact required to
be stated therein or necessary to make the information and statements therein
not misleading. As of the Securitization Closing Date, no fraud, error,
omission, misrepresentation, negligence or similar occurrence with respect to a
Mortgage Loan has taken place on the part of any Person, including without
limitation, the Mortgagor, any appraiser, any builder or developer, or any other
party involved in the origination or servicing of the Mortgage Loan. The Company
has reviewed all of the documents constituting the Servicing File and has made
such inquiries as it deems necessary to make and confirm the accuracy of the
representations set forth herein;
(l) Full Disbursement of Proceeds. Except to the extent the Mortgage
Loan is subject to completion escrows which have been disclosed to and
acknowledged by the Purchaser and which meet the requirements of the
Underwriting Guidelines and as to which a completed Xxxxxx Xxx Form 442 has been
delivered to the Purchaser within sixty (60) days after the related Closing
Date, as of the Securitization Closing Date, the Mortgage Loan has been closed
and the proceeds of the Mortgage Loan have been fully disbursed and there is no
requirement for future advances thereunder, and any and all requirements as to
completion of any on-site or off-site improvement and as to disbursements of any
escrow funds therefor have been complied with. As of the Securitization Closing
Date, 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;
(m) Ownership. As of the Closing Date, the Company or MERS was the
sole owner of record and holder of the Mortgage Loan and the indebtedness
evidenced by each Mortgage Note and upon the sale of the Mortgage Loans to the
Purchaser, the Company retained the Mortgage Files or any part thereof with
respect thereto not delivered to the Custodian, the Purchaser or the Purchaser's
designee, in trust only for the purpose of servicing and supervising the
servicing of each Mortgage Loan. As of the Closing Date, upon payment of the
related Purchase Price, the Mortgage Loan was not assigned or pledged, and the
Company had good, indefeasible and marketable title thereto, and had full right
to transfer and sell the Mortgage Loan to the Purchaser free and clear of any
encumbrance, equity, participation interest, lien, pledge, charge, claim or
security interest, and had full right and authority subject to no interest or
participation of, or agreement with, any other party, to sell and assign each
Mortgage Loan pursuant to the Purchase Agreement and immediately following the
sale of each Mortgage Loan, the Purchaser owned such Mortgage Loan free and
clear of any encumbrance, equity, participation interest, lien, pledge, charge,
claim or security interest related to the Company. As of the Closing Date, the
Company intended to relinquish all rights to possess, control and monitor the
Mortgage Loan. Since the Closing Date, the Company has had and will have no
right to modify or alter the terms of the sale of the Mortgage Loan and the
Company has had and will have no obligation or right to repurchase the Mortgage
Loan or substitute another Mortgage Loan, except as provided in the Purchase
Agreement;
I-10
(n) Doing Business. As of the Closing Date, 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 (2) either (i) organized under the laws of such state, or (ii) qualified to
do business, or exempt from such qualification, in such state, or (iii) a
federal savings and loan association, a savings bank or a national bank having a
principal office in such state, or (3) not doing business in such state;
(o) CLTV, LTV; FICO Score. As of the Securitization Closing Date, no
Mortgage Loan that is a Second Lien Loan has a CLTV in excess of 100% and no
Mortgage Loan has an LTV greater than 100%. At origination of the Mortgage Loan,
the Mortgagor did not have a FICO score of less than 500;
(p) Title Insurance. The Mortgage Loan is covered by an ALTA lender's
title insurance policy or other generally acceptable form of policy or insurance
acceptable to Xxxxxx Xxx or Xxxxxxx Mac and each such title insurance policy is
issued by a title insurer acceptable to 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
(with respect to First Lien Loans) or second priority lien (with respect to
Second Lien Loans) of the Mortgage in the original principal amount of the
Mortgage Loan, subject only to the exceptions contained in clauses (1), (2) and
(3) of paragraph (j) of this Exhibit B, and in the case of Adjustable Rate
Mortgage Loans, against any loss by reason of the invalidity or unenforceability
of the lien resulting from the provisions of the Mortgage providing for
adjustment to the Mortgage Interest Rate and Monthly Payment. Where required by
state law or regulation, the Mortgagor has been given the opportunity to choose
the carrier of the required mortgage title insurance. Additionally, such
lender's title insurance policy affirmatively insures ingress and egress, and
against encroachments by or upon the Mortgaged Property or any interest therein.
The title policy does not contain any special exceptions (other than the
standard exclusions) for zoning and uses and has been marked to delete the
standard survey exception or to replace the standard survey exception with a
specific survey reading. The Company, its successor and assigns, are the sole
insureds of such lender's title insurance policy, and to the Company's knowledge
as of the Servicing Transfer Date, such lender's title insurance policy is valid
and remains in full force and effect and will be in force and effect upon the
consummation of the purchase transactions contemplated by this Agreement. Except
as disclosed in writing by the Company to the Purchaser on or prior to the
Servicing Transfer Date, no claims have been made under such lender's title
insurance policy, and no prior holder of the related Mortgage, including the
Company, has done, by act or omission, anything which would impair the coverage
of such lender's title insurance policy, including without limitation, no
unlawful fee, commission, kickback or other unlawful compensation or value of
any kind has been or will be received, retained or realized by any attorney,
firm or other person or entity, and no such unlawful items have been received,
retained or realized by the Company;
(q) No Defaults. Other than payments due but not yet 30 days or more
delinquent, as of the Closing Date and to the Company's knowledge as of the
Servicing Transfer Date (except as set forth on the Mortgage Loan Schedule
delivered by the Company to the Purchaser on the Servicing Transfer Date), there
is no default, breach, violation or event which
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would permit acceleration existing under the Mortgage or the Mortgage Note and
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
which would permit acceleration, and neither the Company nor any of its
affiliates nor any of their respective predecessors, have waived any default,
breach, violation or event which would permit acceleration. With respect to each
Second Lien Loan, as of the Closing Date and to the Company's knowledge as of
the Servicing Transfer Date, (i) the prior mortgage is in full force and effect,
(ii) there is no default, breach, violation or event of acceleration existing
under such prior mortgage or the related mortgage note and (iii) there is 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 of
acceleration thereunder, and either (A) the prior mortgage contains a provision
which allows or (B) applicable law or the related Mortgage requires, the
mortgagee under the Second Lien Loan to receive notice of, and affords such
mortgagee an opportunity to cure any default by payment in full or otherwise
under the prior mortgage;
(r) No Mechanics' Liens. Except as insured against by the related
title insurance, as of the Closing Date and to the Company's knowledge as of the
Servicing Transfer Date (except as disclosed in writing by the Company to the
Purchaser on or prior to the Servicing Transfer Date), 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;
(s) Location of Improvements; No Encroachments. 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. As of the Closing Date and to the Company's knowledge as of
the Servicing Transfer Date (except as disclosed in writing by the Company to
the Purchaser on or prior to the Servicing Transfer Date), the Mortgaged
Property and all improvements located on or being part of the Mortgaged Property
are in compliance with all applicable zoning and building laws, ordinances and
regulations;
(t) Origination; Payment Terms. As of the Securitization Closing Date,
the Mortgage Loan was originated by a mortgagee approved by the Secretary of
Housing and Urban Development pursuant to Sections 203 and 211 of the Act, a
savings and loan association, a savings bank, a commercial bank, credit union,
insurance company or other similar institution which is supervised and examined
by a federal or state authority. The documents, instruments and agreements
submitted for loan underwriting were not falsified and contain no untrue
statement of material fact or omit to state a material fact required to be
stated therein or necessary to make the information and statements therein not
misleading. No Mortgage Loan contains terms or provisions which would result in
negative amortization. Principal and/or interest payments on the Mortgage Loan
commenced or will commence no more than sixty days after funds were disbursed in
connection with the Mortgage Loan. The Mortgage Interest Rate as well as, with
respect to Adjustable Rate Mortgage Loans, the Lifetime Rate Cap, the Periodic
Rate Floor and the Periodic Rate Cap are as set forth on the related Mortgage
Loan Schedule. The Mortgage Interest Rate is required to be adjusted, with
respect to Adjustable Rate Mortgage Loans, on each Interest Rate Adjustment Date
to equal the Index plus the Gross Margin (rounded
I-12
up or down to the nearest 0.125%), subject to the Periodic Rate Cap, the
Periodic Rate Floor and the Lifetime Rate Cap. Subject to a "balloon" payment in
the case of a Balloon Mortgage Loan, the Mortgage Note is payable in equal
monthly installments of principal and/or interest, which installments are
subject to change due to adjustments to the Mortgage Interest Rate and/or
Monthly Payment on each Interest Rate Adjustment Date or Monthly Payment
Adjustment Date, with interest calculated and payable in arrears, sufficient to
amortize the Mortgage Loan fully by the stated maturity date (unless the
Mortgage Loan is identified on the Mortgage Loan Schedule as a Balloon Mortgage
Loan or an Interest Only Mortgage Loan), over an original term of not more than
thirty years from commencement of amortization. Unless otherwise specified on
the related Mortgage Loan Schedule, the Mortgage Loan is payable on the first
day of each month. There are no Convertible Mortgage Loans which contain a
provision allowing the Mortgagor to convert the Mortgage Note from an adjustable
interest rate Mortgage Note to a fixed interest rate Mortgage Note. The Due Date
of the first payment under the Mortgage Note is no more than 60 days from the
date of the Mortgage Note;
(u) Customary Provisions. The Mortgage contains customary and
enforceable provisions (subject to bankruptcy, insolvency, and similar laws
affecting the rights of creditors and general principles of equity) 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. Upon
default by a Mortgagor on a Mortgage Loan and foreclosure on, or trustee's sale
of, the Mortgaged Property pursuant to the proper procedures, the holder of the
Mortgage Loan will be able to deliver good and merchantable title to the
Mortgaged Property. 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, subject to applicable
federal and state laws and judicial precedent with respect to bankruptcy and
right of redemption or similar law;
(v) Conformance with Agency and Underwriting Guidelines. The Mortgage
Loan was underwritten in accordance with the related Underwriting Guidelines.
The Mortgage Note and Mortgage are on forms acceptable in the secondary mortgage
market and no representations have been made to a Mortgagor that are
inconsistent with the mortgage instruments used;
(w) Occupancy of the Mortgaged Property. As of the Closing Date, and
to the Company's knowledge as of the Servicing Transfer Date, the Mortgaged
Property is capable of being lawfully occupied under applicable law. As of the
Closing Date, and to the Company's knowledge as of the Servicing Transfer Date,
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. The Company has not received notification from any
Governmental Authority that the Mortgaged Property is in material non-compliance
with such laws or regulations, is being used, operated or occupied unlawfully or
has failed to have or obtain such inspection, licenses or certificates, as the
case may be. The Company has not received notice of any violation or failure to
conform with any such law, ordinance, regulation, standard, license or
certificate. If the Mortgage Loan is identified as "owner-occupied" in the
related Mortgage Loan Schedule, the
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Mortgagor represented at the time of origination of the Mortgage Loan that the
Mortgagor would occupy the Mortgaged Property as the Mortgagor's primary
residence;
(x) No Additional Collateral. The Mortgage Note is not and has not
been secured by any collateral except the lien of the corresponding Mortgage and
the security interest of any applicable security agreement or chattel mortgage
referred to in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and duly qualified under applicable law to serve as
such, has been properly designated and as of the Closing Date, and to the
Company's knowledge as of the Servicing Transfer Date, so serves and is named in
the Mortgage (or in the case of a substitution of trustee, is named in a
properly recorded substitution of trustee), and no fees or expenses are or will
become payable by the Purchaser, the Custodian or the Interim Servicer to the
trustee under the deed of trust, except in connection with a trustee's sale
after default by the Mortgagor;
(z) Acceptable Investment. To the Company's knowledge as of the
Servicing Transfer Date, there are no circumstances or conditions with respect
to the Mortgage, the Mortgaged Property, the Mortgagor, the Mortgage File or the
Mortgagor's credit standing that can reasonably be expected to cause private
institutional investors who invest in mortgage loans similar to the Mortgage
Loan to regard the Mortgage Loan as an unacceptable investment, cause the
Mortgage Loan to become delinquent, or adversely affect the value or
marketability of the Mortgage Loan, or cause the Mortgage Loan to prepay during
any period materially faster or slower than the mortgage loans originated by the
Company generally except for the non-prime nature of the Mortgage Loans and the
related Mortgagor's credit. No Mortgaged Property is located in a state, city,
county or other local jurisdiction as described in the related Purchase Price
and Terms Agreement which the Purchaser has determined in its reasonable good
faith discretion would cause the related Mortgage Loan to be ineligible for
whole loan sale or securitization in a transaction consistent with the
prevailing sale and securitization industry (including, without limitation, the
practice of the rating agencies) with respect to substantially similar mortgage
loans;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the Mortgage,
the Assignment of Mortgage, if any, and any other documents required to be
delivered to the Custodian under this Agreement for each Mortgage Loan have been
delivered to the Custodian. The Company is in possession of a complete, true and
accurate Mortgage File in compliance with Exhibit A to the Purchase Agreement,
except for such documents the originals of which have been delivered to the
Custodian, and the Company has retained copies thereof;
(bb) Condominiums/Planned Unit Developments. As of the Securitization
Closing Date, 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 is in conformance with the related
Underwriting Guidelines;
(cc) Transfer of Mortgage Loans. As of the Securitization Closing
Date, except with respect to MERS Designated Mortgage Loans, the Assignment of
Mortgage with respect to each Mortgage Loan is in recordable form and is
acceptable for recording under the laws of the jurisdiction in which the
Mortgaged Property is located. The transfer, assignment
I-14
and conveyance of the Mortgage Notes and the Mortgages by the Company are not
subject to the bulk transfer or similar statutory provisions in effect in any
applicable jurisdiction;
(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision (subject to applicable law) for the
acceleration of the payment of the unpaid principal balance of the Mortgage Loan
in the event that the Mortgaged Property is sold or transferred without the
prior written consent of the mortgagee thereunder, and such provision is
enforceable, subject to applicable law;
(ee) No Balloon Mortgage Loans. The Mortgage Loan is not a Balloon
Mortgage Loan unless specifically listed on the Mortgage Loan Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to which
Monthly Payments are paid or partially paid with funds deposited in any separate
account established by the Company, the Mortgagor, or anyone on behalf of the
Mortgagor, or paid by any source other than the Mortgagor nor does it contain
any other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan, and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature. The
indebtedness evidenced by the Mortgage Note is not convertible to an ownership
interest in the Mortgaged Property or the Mortgagor and the Company has not
financed nor does it own directly or indirectly, any equity of any form in the
Mortgaged Property or the Mortgagor;
(gg) Consolidation of Future Advances. As of the Securitization
Closing Date, any future advances made to the Mortgagor prior to the applicable
Cut-off Date have been consolidated with the outstanding principal amount
secured by the Mortgage, and the secured principal amount, as consolidated,
bears a single interest rate and single repayment term. The lien of the Mortgage
securing the consolidated principal amount is expressly insured as having first
or second, as applicable, lien priority by a title insurance policy, an
endorsement to the policy insuring the mortgagee's consolidated interest or by
other title evidence acceptable to Xxxxxx Xxx and Xxxxxxx Mac. The consolidated
principal amount does not exceed the original principal amount of the Mortgage
Loan;
(hh) Mortgaged Property Undamaged; No Condemnation Proceedings. As of
the Closing Date, and to the Company's knowledge as of the Securitization
Closing Date (except as disclosed in writing by the Company to the Purchaser on
or prior to the Securitization Closing Date), there is no proceeding pending or
threatened for the total or partial condemnation of the Mortgaged Property. As
of the Closing Date, and to the Company's knowledge as of the Securitization
Closing Date (except as disclosed in writing by the Company to the Purchaser on
or prior to the Securitization Closing Date), the Mortgaged Property is
undamaged by waste, 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 and each Mortgaged Property is in good repair. As of the Closing
Date, there have not been any condemnation proceedings with respect to the
Mortgaged Property.
I-15
(ii) Collection Practices; Escrow Deposits; Interest Rate Adjustments.
The origination, servicing and collection practices with respect to the Mortgage
Loan have been in all respects in compliance with Accepted Servicing Practices,
applicable laws and regulations, and have been in all respects legal and proper.
With respect to escrow deposits and Escrow Payments (other than with respect to
Second Lien Loans for which the mortgagee under the prior mortgage lien is
collecting Escrow Payments), all such payments are in the possession of, or
under the control of, the Company through the Servicing Transfer Date, and, as
of such date, there exist no deficiencies in connection therewith for which
customary arrangements for repayment thereof have not been made that will be
assigned without penalty, premium or cost to the Purchaser. Each Mortgage Loan
is covered by a paid in full, life of loan, tax service contract that will be
assigned without penalty, premium or cost to the Purchaser. All Escrow Payments
collected by the Company have been collected in full compliance with state and
federal law and the provisions of the related Mortgage Note and Mortgage. An
escrow of funds is not prohibited by applicable law and all escrows that have
been established have been established in an amount sufficient 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 by the Company under the Mortgage or the Mortgage
Note. All Mortgage Interest Rate adjustments have been made in strict compliance
with state and federal law and the terms of the related Mortgage and Mortgage
Note on the related Interest Rate Adjustment Date. If, pursuant to the terms of
the Mortgage Note, another index was selected for determining the Mortgage
Interest Rate, the same index was used with respect to each Mortgage Note which
required a new index to be selected, and such selection did not conflict with
the terms of the related Mortgage Note. Any and all notices required under
applicable law and the terms of the related Mortgage Note and Mortgage regarding
the Mortgage Interest Rate and the Monthly Payment adjustments have been
delivered. Any interest required to be paid by the Company to the Mortgagor
pursuant to state, federal and local law has been properly paid and credited;
(jj) Mortgage Loan Attributes: The Mortgage Loan fits within the
characteristics set forth on Exhibit B to the related Assignment and Conveyance
Agreement;
(kk) Other Insurance Policies; No Defense to Coverage. Except as
disclosed in writing by the Company to the Purchaser on or prior to the
Servicing Transfer Date, to the Company's knowledge, no action, inaction or
event has occurred and no state of facts exists or has existed that has resulted
or will result in the exclusion from, denial of, or defense to coverage under
any applicable primary mortgage insurance policy, hazard insurance policy or
bankruptcy bond (including, without limitation, any exclusions, denials or
defenses which would limit or reduce the availability of the timely payment of
the full amount of the loss otherwise due thereunder to the insured),
irrespective of the cause of such failure of coverage. The Company has caused
or, before or in connection with the transfer of servicing, will cause to be
performed any and all acts required to preserve the rights and remedies of the
Purchaser in any insurance policies applicable to the Mortgage Loans including,
without limitation, any necessary notifications of insurers, assignments of
policies or interests therein, and establishments of coinsured, joint loss payee
and mortgagee rights in favor of the Purchaser. In connection with the placement
of any such insurance, no commission, fee, or other compensation has been or
will be received by the Company or by any officer, director, or employee of the
Company or any
I-16
designee of the Company or any corporation in which the Company or any officer,
director, or employee had a financial interest at the time of placement of such
insurance;
(ll) No Violation of Environmental Laws. As of the Closing Date, and
to the Company's knowledge as of the Servicing Transfer Date (except as
disclosed in writing by the Company to the Purchaser on or prior to the
Servicing Transfer Date), the Mortgaged Property is free from any and all toxic
or hazardous substances and there exists no violation of any local, state or
federal environmental law, rule or regulation. As of the Closing Date, and to
the Company's knowledge as of the Servicing Transfer Date (except as disclosed
in writing by the Company to the Purchaser on or prior to the Servicing Transfer
Date), 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. As of the Closing Date, based upon customary and prudent residential
mortgage industry underwriting standards, and as of the Servicing Transfer Date
(except as disclosed in writing by the Company to the Purchaser on or prior to
the Servicing Transfer Date), in each case to the Company's knowledge, 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;
(mm) 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, or any similar state
statute;
(nn) Appraisal. The Company has delivered to the Purchaser an
appraisal of the Mortgaged Property signed prior to the approval of the Mortgage
application by an appraiser who (i) was licensed in the state where the
Mortgaged Property is located, (ii) had no interest, direct or indirect, in the
Mortgaged Property or in any Mortgage Loan or the security therefor, and (iii)
did not receive compensation that affected the approval or disapproval of the
Mortgage Loan. The appraisal shall have been made within one hundred and eighty
(180) days of the origination of the Mortgage Loan and shall be completed in
compliance with the Uniform Standards of Professional Appraisal Practice, and
all applicable federal and state laws and regulations. If the appraisal was made
more than one hundred and twenty (120) days before the origination of the
Mortgage Loan, the Company shall have received and delivered to the Purchaser a
recertification of the appraisal; (oo) Disclosure Materials. As of the
Securitization Closing Date, the Mortgagor has, to the extent required by
applicable law, executed one or more statements to the effect that the Mortgagor
has, received all disclosure materials required by applicable law and the
Company has complied with all applicable law with respect to the making of the
Mortgage Loans. The Company shall cause the Interim Servicer to maintain such
statement(s) in the Mortgage File;
(pp) Construction or Rehabilitation of Mortgaged Property. As of the
Securitization Closing Date, the Mortgage Loan was not made to finance the
construction or rehabilitation of a Mortgaged Property or facilitating the
trade-in or exchange of a Mortgaged Property;
I-17
(qq) Qualified Mortgage. As of the Closing Date, the Mortgage Loan is
a qualified mortgage under Section 860G(a)(3) of the Code;
(rr) Credit Information. As to each consumer report (as defined in the
Fair Credit Reporting Act, Public Law 91-508) or other credit information
furnished by the Company to the Purchaser, the Company has full right and
authority and is not precluded by law or contract from furnishing such
information to the Purchaser and the Purchaser is not precluded by the terms of
the Mortgage Loan Documents from furnishing the same to any subsequent or
prospective purchaser of such Mortgage. The Company shall hold the Purchaser
harmless from any and all damages, losses, costs and expenses (including
attorney's fees) arising from disclosure of credit information in connection
with the Purchaser's secondary marketing operations and the purchase and sale of
mortgages. The Company has in its capacity as a servicer, for each Mortgage
Loan, 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;
(ss) Leaseholds. As of the Closing Date, and to the Company's
knowledge as of the Servicing Transfer Date, if the Mortgage Loan is secured by
a long-term residential lease, (1) the lessor under the lease holds a fee simple
interest in the land; (2) the terms of such lease expressly permit the
mortgaging of the leasehold estate and the acquisition by the holder of the
Mortgage of the rights of the lessee upon foreclosure or assignment in lieu of
foreclosure or provide the holder of the Mortgage with substantially similar
protections; (3) the terms of such lease do not (a) allow the termination
thereof upon the lessee's default without the holder of the Mortgage being
entitled to receive written notice of, and opportunity to cure, such default,
(b) allow the termination of the lease in the event of damage or destruction as
long as the Mortgage is in existence, (c) prohibit the holder of the Mortgage
from being insured (or receiving proceeds of insurance) under the hazard
insurance policy or policies relating to the Mortgaged Property or (d) permit
any increase in rent other than pre-established increases set forth in the
lease; (4) the original term of such lease is not less than 15 years; (5) the
term of such lease does not terminate earlier than five years after the maturity
date of the Mortgage Note; and (6) the Mortgaged Property is located in a
jurisdiction in which the use of leasehold estates in transferring ownership in
residential properties is a widely accepted practice;
(tt) Prepayment Penalty. The Mortgage Loan is subject to a prepayment
penalty as provided in the related Mortgage Note except as set forth on the
related Mortgage Loan Schedule. With respect to each Mortgage Loan that has a
prepayment penalty feature, each such prepayment penalty is enforceable (subject
to bankruptcy, insolvency, and similar laws affecting the rights of creditors
and general principles of equity) for the benefit of the Purchaser, and each
prepayment penalty is permitted pursuant to applicable law. Each such prepayment
penalty is in an amount not greater than the maximum amount permitted under
applicable law and no such prepayment penalty may be imposed for a term in
excess of five (5) years;
(uu) Conversion to Fixed Interest Rate. With respect to Adjustable
Rate Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;
I-18
(vv) Escrow Analysis. With respect to each Mortgage, the Company has
within the twelve months preceding the Closing Date (unless such Mortgage was
originated within such twelve month period) analyzed the required Escrow
Payments for each Mortgage and adjusted the amount of such payments so that,
assuming all required payments are timely made, any deficiency will be
eliminated on or before the first anniversary of such analysis, or any overage
will be refunded to the Mortgagor, in accordance with RESPA and any other
applicable law;
(ww) Predatory Lending Regulations. No Mortgage Loan is a High Cost
Loan or Covered Loan, as applicable, and no Mortgage Loan originated on or after
October 1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending
Act. No Mortgage Loan is covered by the Home Ownership and Equity Protection Act
of 1994 and no Mortgage Loan is in violation of any comparable state or local
law. The Mortgaged Property is not located in a jurisdiction where a breach of
this representation with respect to the related Mortgage Loan may result in
additional assignee liability to the Purchaser, as determined by Purchaser in
its reasonable discretion and as described in the related Purchase Price and
Terms Agreement;
(xx) Single-premium credit life insurance policy. As of the
Securitization Closing Date, in connection with the origination of the Mortgage
Loan, no proceeds from such Mortgage Loan were used to finance or acquire a
single-premium credit life insurance policy, credit disability, credit
unemployment or credit property insurance policy;
(yy) Regarding the Mortgagor. The Mortgagor is one or more natural
persons and/or an Illinois land trust or a "living trust" and such "living
trust" is in compliance with Xxxxxx Xxx guidelines for such trusts; (zz)
Insurance. The Company has caused or, before or in connection with the transfer
of servicing, will cause to be performed any and all acts required to preserve
the rights and remedies of the Purchaser in any insurance policies applicable to
the Mortgage Loans including, without limitation, any necessary notifications of
insurers, assignments of policies or interests therein, and establishments of
coinsured, joint loss payee and mortgagee rights in favor of the Purchaser;
(aaa) Simple Interest Mortgage Loans. The Mortgage Loan is not a
simple interest Mortgage Loan;
(bbb) Flood Certification Contract. The Mortgage Loan is covered by a
paid in full, life of loan, transferable flood certification contract that has
been or will be assigned without penalty, cost or premium to the Purchaser;
(ccc) Consent. Either (a) no consent for the Second Lien Loan is
required by the holder of the related first lien or (b) such consent has been
obtained and is contained in the Mortgage File;
(ddd) Origination Date. Except as shown on the related Mortgage Loan
Schedule, the date of origination of the Mortgage Loan shall be no earlier than
three (3) months prior to the date such Mortgage Loan was first purchased by the
Purchaser;
I-19
(eee) Mortgage Submitted for Recordation. As of the Closing Date, and
to the Company's knowledge as of the Servicing Transfer Date, the Mortgage
either has been or will promptly be submitted for recordation in the appropriate
governmental recording office of the jurisdiction where the Mortgaged Property
is located;
(fff) Endorsements. The Mortgage Note has been endorsed by Company for
its own account and not as a fiduciary, trustee, trustor or beneficiary under a
trust agreement;
(ggg) Accuracy of Information. All information provided to the
Purchaser by the Company with respect to the Mortgage Loan was accurate in all
material respects;
(hhh) No Construction Loans. No Mortgage Loan was made to (a)
facilitate the trade-in or exchange of a Mortgaged Property or (b) finance the
construction or rehabilitation of a Mortgaged Property, unless the Mortgage Loan
is a construction-to-permanent mortgage loan which has been fully disbursed, all
construction work is complete and a completion certificate has been issued;
(iii) No Equity Participation. No document relating to the Mortgage
Loan provides for any contingent or additional interest in the form of
participation in the cash flow of the Mortgaged Property or a sharing in the
appreciation of the value of the Mortgaged Property. The indebtedness evidenced
by the Mortgage Note is not convertible to an ownership interest in the
Mortgaged Property or the Mortgagor and Company has not financed nor does it own
directly or indirectly, any equity of any form in the Mortgaged Property or the
Mortgagor; and
(jjj) No Arbitration. No Mortgagor with respect to any Mortgage Loan
originated on or after August 1, 2004 agreed to submit to arbitration to resolve
any dispute arising out of or relating in any way to the mortgage loan
transaction.
I-20
Exhibit J
EXHIBIT J
FORM OF INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AND CONTRIBUTION AGREEMENT ("Agreement"), dated
as of [_______], 200_, between IXIS Real Estate Capital Inc., a New York
corporation ("IXIS"), and Accredited Home Lenders, Inc., a [__________]
corporation (the "Seller").
WHEREAS, [________________] (the "Depositor"), is acting as depositor
and registrant with respect to the Prospectus, dated [________________], and the
Prospectus Supplement to the Prospectus, [________________] (the "Prospectus
Supplement"), relating to [________________] Certificates (the "Certificates")
to be issued pursuant to a Pooling and Servicing Agreement, dated as of
[________________] (the "P&S"), among the Depositor, as depositor,
[________________], as servicer (the "Servicer"), and [________________], as
trustee (the "Trustee");
WHEREAS, as an inducement to the Depositor to enter into the P&S, and
[____________________] (the "Underwriter[s]") to enter into the Underwriting
Agreement, dated [____________________] (the "Underwriting Agreement") between
the Depositor and the Underwriter[s], Seller has agreed to provide for
indemnification and contribution on the terms and conditions hereinafter set
forth;
WHEREAS, IXIS purchased from Seller certain of the Mortgage Loans
underlying the Certificates (the "Mortgage Loans") from Seller pursuant to an
Third Amended and Restated Mortgage Loan Purchase and Warranties Agreement,
dated as of August 1, 2006 (the "Purchase Agreement"), by and between IXIS and
Seller; and
WHEREAS, pursuant to Section 13 of the Purchase Agreement, Seller has
agreed to indemnify IXIS, the Depositor, the Underwriter[s] and their respective
affiliates, present and former directors, officers, employees and agents.
NOW THEREFORE, in consideration of the agreements contained herein,
and other valuable consideration the receipt and sufficiency of which are hereby
acknowledged, Seller and IXIS agree as follows:
1. Indemnification and Contribution.
(a) Seller agrees to indemnify and hold harmless IXIS, the Depositor,
the Underwriter[s] and their respective affiliates, present and former
directors, officers, employees and agents and each person, if any, who controls
IXIS, the Depositor, the Underwriter[s] or such affiliate within the meaning of
either Section 15 of the Securities Act of 1933, as amended (the "1933 Act"), or
Section 20 of the Securities Exchange Act of 1934, as amended (the "1934 Act"),
against any and all losses, claims, damages or liabilities, joint or several, to
which they or
J-1
any of them may become subject under the 1933 Act, the 1934 Act or other federal
or state statutory law or regulation, at common law or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based in whole or in part upon (i) any violation of the
representation and warranty set forth in Section 2(vii) below or (ii) any untrue
statement or alleged untrue statement of a material fact contained in the
Prospectus Supplement, ABS Informational and Computational Material or in the
Free Writing Prospectus or any omission or alleged omission to state in the
Prospectus Supplement, ABS Informational and Computational Material or in the
Free Writing Prospectus 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, or any such untrue statement or omission or
alleged untrue statement or alleged omission made in any amendment of or
supplement to the Prospectus Supplement, ABS Informational and Computational
Material or the Free Writing Prospectus and agrees to reimburse IXIS, the
Depositor, the Underwriter[s] or such affiliates and each such officer,
director, employee, agent and controlling person promptly upon demand for any
legal or other expenses reasonably incurred by any of them in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred; provided, however,
that Seller shall be liable in any such case only to the extent that any such
loss, claim, damage, liability or action arises out of, or is based upon, any
untrue statement or alleged untrue statement or omission or alleged omission
made in reliance upon and in conformity with the Seller Information. The
foregoing indemnity agreement is in addition to any liability which Seller may
otherwise have to IXIS, the Depositor, the Underwriter[s] its affiliates or any
such director, officer, employee, agent or controlling person of IXIS, the
Depositor, the Underwriter[s] or their respective affiliates.
As used herein:
"ABS Informational and Computational Material" means any written
communication as defined in Item 1101(a) of Regulation AB under the 1933 Act and
the 1934 Act, as amended from time to time.
"Free Writing Prospectus" means any written communication that
constitutes a "free writing prospectus," as defined in Rule 405 under the 1933
Act.
"Regulation AB" means Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. Sections 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.
"Seller Information" means any information relating to Seller, the
Mortgage Loans and/or the underwriting guidelines relating to the Mortgage Loans
set forth in the Prospectus Supplement, ABS Informational and Computational
Material or the Free Writing Prospectus [and static pool information regarding
mortgage loans originated or acquired by the Seller [and included in the
Prospectus Supplement, ABS Informational and Computational Material, the
Offering Circular or the Free Writing Prospectus] [incorporated by reference
from the website located at [______________]].
I-2
(b) Promptly after receipt by any indemnified party under this Section
1 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 this Section 1, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 1 except to the extent it has
been materially prejudiced by such failure; and provided, further, however, that
the failure to notify any indemnifying party shall not relieve it from any
liability which it may have to any indemnified party otherwise than under this
Section 1.
If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, except as provided in
the following paragraph, the indemnifying party shall not be liable to the
indemnified party under this Section 1 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation.
Any indemnified party shall have the right to employ separate counsel
in any such action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
necessary or appropriate for such indemnified party to employ separate counsel;
or (iii) the indemnifying party has failed to assume the defense of such action
and employ counsel reasonably satisfactory to the indemnified party, in which
case, if such indemnified party notifies the indemnifying party in writing that
it elects to employ separate counsel at the expense of the indemnifying party,
the indemnifying party shall not have the right to assume the defense of such
action on behalf of such indemnified party, it being understood, however, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to local counsel) at any time for all such indemnified parties.
Each indemnified party, as a condition of the indemnity agreements
contained in this Section 1, shall cooperate with the indemnifying party in the
defense of any such action or claim. No indemnifying party shall be liable for
any settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment for the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any indemnified
party from and against any loss or liability by reason of such settlement or
judgment.
I-3
Notwithstanding the foregoing sentence, if at any time an indemnified
party shall have requested an indemnifying party to reimburse the indemnified
party for reasonable fees and expenses of counsel, the indemnifying party agrees
that it shall be liable for any settlement of any proceeding effected without
its written consent if (i) such settlement is entered into more than thirty (30)
days after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement.
(c) If the indemnification provided for in this Section 1 is
unavailable to an indemnified party, then the indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages or
liabilities, in such proportion as is appropriate to reflect the relative fault
of the indemnifying party and the indemnified party, respectively, in connection
with the statements or omissions that result in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault of the indemnified party and indemnifying party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by such parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission and any other equitable considerations.
(d) The indemnity and contribution agreements contained in this
Section 1 and the representations and warranties set forth in Section 2 shall
remain operative and in full force and effect regardless of (i) any termination
of this Agreement, (ii) any investigation made by IXIS, the Depositor, the
Underwriter[s] their respective affiliates, directors, officers, employees or
agents or any person controlling IXIS, the Depositor, the Underwriter[s] or any
such affiliate and (iii) acceptance of and payment for any of the Offered
Certificates.
2. Representations and Warranties. Seller represents and warrants
that:
(i) Seller is validly existing and in good standing under the laws of
its jurisdiction of formation or incorporation, as applicable, and has full
power and authority to own its assets and to transact the business in which
it is currently engaged. Seller is duly qualified to do business and is in
good standing in each jurisdiction in which the character of the business
transacted by it or any properties owned or leased by it requires such
qualification and in which the failure so to qualify would have a material
adverse effect on the business, properties, assets or condition (financial
or otherwise) of Seller;
(ii) Seller is not required to obtain the consent of any other person
or any consent, license, approval or authorization from, or registration or
declaration with, any governmental authority, bureau or agency in
connection with the execution, delivery, performance, validity or
enforceability of this Agreement;
(iii) the execution, delivery and performance of this Agreement by
Seller will not violate any provision of any existing law or regulation or
any order decree of any court applicable to Seller or any provision of the
charter or bylaws of Seller, or constitute
I-4
a material breach of any mortgage, indenture, contract or other agreement
to which Seller is a party or by which it may be bound;
(iv) except as disclosed in public filings with the Securities
Exchange Commission by Seller or its affiliates, (a) no proceeding of or
before any court, tribunal or governmental body is currently pending or,
(b) to the knowledge of Seller, threatened against Seller or any of its
properties or with respect to this Agreement or the Offered Certificates,
in either case, which would have a material adverse effect on the business,
properties, assets or condition (financial or otherwise) of Seller];
(v) Seller has full power and authority to make, execute, deliver and
perform this Agreement and all of the transactions contemplated hereunder,
and has taken all necessary corporate action to authorize the execution,
delivery and performance of this Agreement. When executed and delivered,
this Agreement will constitute the legal, valid and binding obligation of
each of Seller enforceable in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors'
rights generally, by the availability of equitable remedies, and by
limitations of public policy under applicable securities law as to rights
of indemnity and contribution thereunder;
(vi) this Agreement has been duly executed and delivered by Seller
[and Initial Servicer]; and
(vii) This representation should only be included if the Mortgage
Loans comprise 20% or more of the loans in the pool. The Indemnifying Party
represents that except as disclosed in writing to the Underwriters or the
Depositor: (i) there are no material legal or governmental proceedings
pending (or known to be contemplated) against the Indemnifying Party or any
Third-Party Originator (as defined in the Purchase Agreement); and (ii)
there are no affiliations, relationships or transactions relating to the
Indemnifying Party or any Third-Party Originator with respect to any
Securitization Transaction (as defined in the Accredited Purchase
Agreement) and the list of parties provided to the Indemnifying Party in
writing by the Depositor on or prior to the date hereof.
3. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to Seller will be mailed, delivered or
telegraphed and confirmed to Accredited Home Lenders, Inc., 00000 Xxxxxx xx
Xxxxxxx, Xxx Xxxxx, Xxxxxxxxxx 00000; or, if sent to IXIS, will be mailed,
delivered or telegraphed and confirmed to IXIS, 0 Xxxx 00xx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention: General Counsel.
4. Miscellaneous. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York without giving effect to
the conflict of laws provisions thereof. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their successors and
assigns and the controlling persons referred to herein, and no other person
shall have any right or obligation hereunder. Neither this Agreement nor any
term hereof may be changed, waived, discharged or terminated orally, but only by
an instrument in writing signed by the party against whom enforcement of the
change, waiver, discharge or
I-5
termination is sought. This Agreement may be executed in counterparts, each of
which when so executed and delivered shall be considered an original, and all
such counterparts shall constitute one and the same instrument. Capitalized
terms used but not defined herein shall have the meanings provided in the P&S.
[Remainder of Page Intentionally Left Blank]
I-6
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective officers hereunto duly authorized, this
__th day of [_____________].
IXIS REAL ESTATE CAPITAL INC.
By:
-------------------------------------
Name:
Title:
By:
-------------------------------------
Name:
Title:
ACCREDITED HOME LENDERS, INC.
By:
-------------------------------------
Name:
Title:
J-7
EXHIBIT Z
CIT AGREEMENTS
Z-1
EXHIBIT AA
FIRST BANK AGREEMENTS
AA-1
EXECUTION COPY
ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated January 30, 2007
("Agreement"), among IXIS Real Estate Capital Inc. (f/k/a CDC Mortgage Capital
Inc.) ("Assignor"), Xxxxxx Xxxxxxx ABS Capital I Inc. ("Assignee") and First
Bank Mortgage (the "Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns
to the Assignee (x) all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed as being
originated by the Company on the schedule (the "Mortgage Loan Schedule")
attached hereto as Exhibit A (the "Mortgage Loans") and (b) except as described
below, that certain First Amended and Restated Mortgage Loan Purchase and
Warranties Agreement (the "Purchase Agreement"), dated as of January 1, 2006,
between the Assignor, as purchaser (the "Purchaser"), and the Company, as
seller, as amended by Amendment No. 1, dated as of May 1, 2006, solely insofar
as the Purchase Agreement relates to the Mortgage Loans and (y) other than as
provided below with respect to the enforcement of representations and
warranties, none of the obligations of the Assignor under the Purchase
Agreement.
The Assignor specifically reserves and does not assign to the Assignee
hereunder (i) any and all right, title and interest in, to and under and any
obligations of the Assignor with respect to any mortgage loans subject to the
Purchase Agreement which are not the Mortgage Loans set forth on the Mortgage
Loan Schedule and are not the subject of this Agreement or (ii) the rights of
the Purchaser (a) under Subsection 9.04 of the Purchase Agreement or (b) to any
premium recapture (i.e., the excess, if any, of the purchase price percentage
over par) in connection with any repurchase pursuant to Subsections 9.03 and
9.05 of the Purchase Agreement.
Recognition of the Company
2. From and after the date hereof (the "Securitization Closing Date"),
the Company shall and does hereby recognize that the Assignee will transfer the
Mortgage Loans and assign its rights under the Purchase Agreement (solely to the
extent set forth herein) and this Agreement to IXIS Real Estate Capital Trust
2007-HE1 (the "Trust") created pursuant to a Pooling and Servicing Agreement,
dated as of January 1, 2007 (the "Pooling Agreement"), among the Assignee, the
Assignor, Deutsche Bank National Trust Company, as trustee (in such capacity,
including its successors in interest and any successor trustees under the
Pooling Agreement, the "Trustee"), Xxxxx Fargo Bank, National Association, as
securities administrator (in such capacity, including its successors in interest
and any successor securities administrators under the Pooling Agreement, the
"Securities Administrator"), master servicer (in such capacity, including
its successors in interest and any successor master servicers under the Pooling
Agreement, the "Master Servicer") and Saxon Mortgage Services, Inc., as servicer
(including its successors in interest and any successor servicer under the
Pooling Agreement, the "Servicer"). The Company hereby acknowledges and agrees
that from and after the date hereof (i) the Trust will be the owner of the
Mortgage Loans, (ii) the Company shall look solely to the Trust for performance
of any obligations of the Assignor insofar as they relate to the enforcement of
the representations, warranties and covenants with respect to the Mortgage
Loans, (iii) the Trust (including the Trustee, Securities Administrator, Master
Servicer and the Servicer acting on the Trust's behalf) shall have all the
rights and remedies available to the Assignor, insofar as they relate to the
Mortgage Loans, under the Purchase Agreement, including, without limitation, the
enforcement of the document delivery requirements set forth in Section 6 of the
Purchase Agreement, and shall be entitled to enforce all of the obligations of
the Company thereunder insofar as they relate to the Mortgage Loans, and (iv)
all references to the Purchaser (insofar as they relate to the rights, title and
interest and, with respect to obligations of the Purchaser, only insofar as they
relate to the enforcement of the representations, warranties and covenants of
the Company), the Custodian or the Bailee under the Purchase Agreement insofar
as they relate to the Mortgage Loans, shall be deemed to refer to the Trust
(including the Trustee, Securities Administrator, Master Servicer and the
Servicer acting on the Trust's behalf). Neither the Company nor the Assignor
shall amend or agree to amend, modify, waiver, or otherwise alter any of the
terms or provisions of the Purchase Agreement which amendment, modification,
waiver or other alteration would in any way affect the Mortgage Loans or the
Company's performance under the Purchase Agreement with respect to the Mortgage
Loans without the prior written consent of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee
and the Trust (including the Trustee, Securities Administrator, Master Servicer
and the Servicer acting on the Trust's behalf) as of the date hereof that:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver
and perform its obligations under this Agreement and has full power and
authority to perform its obligations under the Purchase Agreement. The
execution by the Company of this Agreement is in the ordinary course of the
Company's business and will not conflict with, or result in a breach of,
any of the terms, conditions or provisions of the Company's charter or
bylaws or any legal restriction, or any material agreement or instrument to
which the Company is now a party or by which it is bound, or result in the
violation of any law, rule, regulation, order, judgment or decree to which
the Company or its property is subject. The execution, delivery and
performance by the Company of this Agreement have been duly authorized by
all necessary corporate action on part of the Company. This Agreement has
been duly executed and delivered by the Company, and, upon the due
authorization, execution and delivery by the Assignor and the Assignee,
will constitute the valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization,
-2-
insolvency, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, and by general principles of
equity regardless of whether enforceability is considered in a proceeding
in equity or at law;
(c) No consent, approval, order or authorization of, or
declaration, filing or registration with, any governmental entity is
required to be obtained or made by the Company in connection with the
execution, delivery or performance by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation pending
or threatened against the Company, before any court, administrative agency
or other tribunal, which would draw into question the validity of this
Agreement or the Purchase Agreement, or which, either in any one instance
or in the aggregate, would result in any material adverse change in the
ability of the Company to perform its obligations under this Agreement or
the Purchase Agreement, and the Company is solvent.
4. Pursuant to Section 13 of the Purchase Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust (including the Trustee, Securities Administrator, Master Servicer
and the Servicer acting on the Trust's behalf), that the representations and
warranties set forth in Section 9.02 of the Purchase Agreement are true and
correct as of the date hereof as if such representations and warranties were
made on the date hereof unless otherwise specifically stated in such
representations and warranties, except that (i) the representation and warranty
set forth in Section 9.02(a) shall, for purposes of this Agreement, relate to
the Mortgage Loan Schedule attached hereto , and (ii) the Company hereby
represents and warrants, for the benefit of the Assignor, the Assignee and the
Trust, that the following representation and warranty is true and correct as of
the date here of as if such representation and warranty was made of the date
hereof: No Mortgage Loan is a High Cost Loan or Covered Loan, as applicable, and
no Mortgage Loan originated on or after October 1, 2002 through March 6, 2003 is
governed by the Georgia Fair Lending Act. No Mortgage Loan is covered by the
Home Ownership and Equity Protection Act of 1994 and no Mortgage Loan is in
violation of any comparable state or local law.
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf) in connection with any breach of the representations and warranties made
by the Company set forth in Sections 3 and 4 hereof shall be as set forth in
Subsection 9.03 of the Purchase Agreement as if they were set forth herein
(including without limitation the repurchase and indemnity obligations set forth
therein); provided, however, that the Assignor specifically reserves and does
not assign to the Assignee hereunder any and all right, title and interest in
the Premium Percentage, if any, due in connection with the repurchase of a
Mortgage Loan pursuant to Subsections 9.03, 9.04 and 9.05.
-3-
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced, with the prior
written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors and
assigns of the parties hereto and (ii) the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf). Any entity into which Assignor, Assignee or Company may be merged or
consolidated shall, without the requirement for any further writing, be deemed
Assignor, Assignee or Company, respectively, hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive the
conveyance of the Mortgage Loans and the assignment of the Purchase Agreement
(to the extent assigned hereunder) by Assignor to Assignee and by Assignee to
the Trust and nothing contained herein shall supersede or amend the terms of the
Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
[SIGNATURE PAGE FOLLOWS]
-4-
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
XXXXXX XXXXXXX ABS CAPITAL I INC.
By: /s/ Xxxxxxx Xxx
--------------------------------------
Name: Xxxxxxx Xxx
Its: Vice President
IXIS REAL ESTATE CAPITAL INC.
By: /s/ F. Xxxx Xxxxxx
--------------------------------------
Name: F. Xxxx Xxxxxx
Its: Managing Director
By: /s/ Xxxxxxxxxxx Xxxxxx
--------------------------------------
Name: Xxxxxxxxxxx Xxxxxx
Its: Managing Director
FIRST BANK MORTGAGE
By: /s/ Xxxxxxxxx X. Xxxxx
--------------------------------------
Name: Xxxxxxxxx X. Xxxxx
Its: Vice President - Loan Operations
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
MORTGAGE LOAN SCHEDULE
EXECUTION COPY
================================================================================
FIRST AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT
----------
IXIS REAL ESTATE CAPITAL INC.,
Purchaser
FIRST BANC MORTGAGE, INC.
Seller
----------
Dated as of January 1, 2006
Adjustable-Rate and Fixed-Rate, B/C Residential Mortgage Loans
================================================================================
TABLE OF CONTENTS
Page
----
SECTION 1. DEFINITIONS................................................ 2
SECTION 2. AGREEMENT TO PURCHASE ..................................... 14
SECTION 3. MORTGAGE SCHEDULES ........................................ 14
SECTION 4. PURCHASE PRICE ............................................ 14
SECTION 5. EXAMINATION OF MORTGAGE FILES ............................. 15
SECTION 6. CONVEYANCE FROM SELLER TO PURCHASER ....................... 15
Subsection 6.01 Conveyance of Mortgage Loans; Possession of
Servicing Files.................................... 15
Subsection 6.02 Books and Records.................................. 16
Subsection 6.03 Delivery of Mortgage Loan Documents................ 16
Subsection 6.04 Quality Control Procedures......................... 17
Subsection 6.05 MERS Designated Mortgage Loans..................... 18
SECTION 7. SERVICING OF THE MORTGAGE LOANS............................ 18
SECTION 8. TRANSFER OF SERVICING...................................... 19
SECTION 9. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SELLER;
REMEDIES FOR BREACH........................................ 21
Subsection 9.01 Representations and Warranties Regarding the
Seller............................................. 21
Subsection 9.02 Representations and Warranties Regarding Individual
Mortgage Loans..................................... 25
Subsection 9.03 Remedies for Breach of Representations and
Warranties......................................... 40
Subsection 9.04 Repurchase of Mortgage Loans That Prepay in Full... 43
Subsection 9.05 Repurchase of Mortgage Loans with First Payment
Defaults........................................... 43
SECTION 10. CLOSING.................................................... 43
SECTION 11. CLOSING DOCUMENTS.......................................... 44
SECTION 12. COSTS...................................................... 00
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XXXXXXX 00. COOPERATION OF SELLER WITH A RECONSTITUTION................ 46
SECTION 14. THE SELLER................................................. 48
Subsection 14.01 Additional Indemnification by the Seller; Third
Party Claims....................................... 48
Subsection 14.02 Merger or Consolidation of the Seller.............. 49
SECTION 15. FINANCIAL STATEMENTS....................................... 49
SECTION 16. MANDATORY DELIVERY; GRANT OF SECURITY INTEREST............. 49
SECTION 17. NOTICES.................................................... 50
SECTION 18. SEVERABILITY CLAUSE........................................ 51
SECTION 19. COUNTERPARTS............................................... 51
SECTION 20. GOVERNING LAW JURISDICTION; CONSENT TO SERVICE OF PROCESS.. 51
SECTION 21. INTENTION OF THE PARTIES................................... 52
SECTION 22. SUCCESSORS AND ASSIGNS; ASSIGNMENT OF PURCHASE AGREEMENT... 52
SECTION 23. WAIVERS.................................................... 52
SECTION 24. EXHIBITS................................................... 52
SECTION 25. GENERAL INTERPRETIVE PRINCIPLES............................ 52
SECTION 26. REPRODUCTION OF DOCUMENTS.................................. 53
SECTION 27. FURTHER AGREEMENTS......................................... 53
SECTION 28. RECORDATION OF ASSIGNMENTS OF MORTGAGE..................... 53
SECTION 29. NO SOLICITATION............................................ 54
SECTION 30. WAIVER OF TRIAL BY JURY.................................... 54
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SECTION 31. COMPLIANCE WITH REGULATION AB.............................. 54
Subsection 31.01 Intent of the Parties; Reasonableness.............. 54
Subsection 31.02 Additional Representations and Warranties of the
Seller............................................. 55
Subsection 31.03 Information to Be Provided by the Seller........... 56
Subsection 31.04 Indemnification; Remedies.......................... 58
EXHIBITS
EXHIBIT A CONTENTS OF EACH MORTGAGE FILE
EXHIBIT B FORM OF INTERIM SERVICING AGREEMENT
EXHIBIT C FORM OF SELLER'S OFFICER'S CERTIFICATE
EXHIBIT D FORM OF OPINION OF COUNSEL TO THE SELLER AND THE INTERIM
SERVICER
EXHIBIT E FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT F FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT G [RESERVED]
EXHIBIT H FORM OF ASSIGNMENT AND CONVEYANCE AGREEMENT
EXHIBIT I SELLER'S UNDERWRITING GUIDELINES
EXHIBIT J FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
EXHIBIT K FORM OF INDEMNIFICATION AND CONTRIBUTION AGREEMENT
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FIRST AMENDED AND RESTATED
MORTGAGE LOAN PURCHASE AND WARRANTIES AGREEMENT
This FIRST AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND WARRANTIES
AGREEMENT (the "Agreement"), dated as of January 1, 2006, by and between IXIS
Real Estate Capital Inc., a New York corporation, having an office at 0 Xxxx
00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Purchaser"), and First
Banc Mortgage, Inc., a Missouri corporation, having an office at 00000 Xxxxxx
Xxxx., Xxxxx 000, Xxxxxx, Xxxxxxxxxx 00000 (the "Seller").
WITNESSETH:
WHEREAS, the Purchaser and the Seller are parties to that certain
Mortgage Loan Purchase and Warranties Agreement, dated as of April, 1 2003, as
amended by Amendment No. 1 dated as of April 1, 2003, as amended by Amendment
No. 2 dated as of March 24, 2004, as amended by Amendment No. 3 dated as of
August 1, 2004 (the "Original Purchase Agreement") and the Seller desires to
sell, from time to time, to the Purchaser, and the Purchaser desires to
purchase, from time to time, from the Seller, certain first and second lien,
adjustable-rate and fixed-rate B/C residential mortgage loans (the "Mortgage
Loans") on a servicing released basis as described herein, and which shall be
delivered in pools of whole loans (each, a "Mortgage Loan Package") on various
dates as provided herein (each, a "Closing Date");
WHEREAS, each Mortgage Loan is secured by a mortgage, deed of trust or
other security instrument creating a first or second lien on a residential
dwelling located in the jurisdiction indicated on the Mortgage Loan Schedule for
the related Mortgage Loan Package;
WHEREAS, the Purchaser and the Seller wish to prescribe the manner of
the conveyance, servicing by the Interim Servicer and control of the Mortgage
Loans; and
WHEREAS, following its purchase of the Mortgage Loans from the Seller,
the Purchaser desires to sell some or all of the Mortgage Loans to one or more
purchasers as a whole loan transfer or a public or private, rated or unrated
mortgage pass-through transaction; and
WHEREAS, the Purchaser and the Seller desire to amend the Original
Purchase Agreement as set forth herein;
NOW, THEREFORE, in consideration of the premises and mutual agreements
set forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Purchaser and the Seller agree
as follows:
SECTION 1. Definitions.
For purposes of this Agreement the following capitalized terms shall
have the respective meanings set forth below.
Accepted Servicing Practices: With respect to any Mortgage Loan, those
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 and incorporating
the Delinquency Collection Policies and Procedures.
Act: The National Housing Act, as amended from time to time.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan
purchased pursuant to this Agreement.
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agency Transfer: A Xxxxxx Xxx Transfer or a Xxxxxxx Mac Transfer.
Agreement: This Mortgage Loan Purchase and Warranties Agreement and
all amendments hereof and supplements hereto.
ALTA: The American Land Title Association and its successors in
interest.
Appraised Value: (i) With respect to any First Lien Loan, the value of
the related Mortgaged Property based upon the appraisal made, if any, for the
originator at the time of origination of the Mortgage Loan or the sales price of
the Mortgaged Property at such time of origination, whichever is less; provided,
however, that in the case of a refinanced Mortgage Loan, such value is based
solely upon the appraisal made, if any, at the time of origination of such
refinanced Mortgage Loan, and (ii) with respect to any Second Lien Loan, the
value, determined pursuant to the Seller's Underwriting Guidelines, of the
related Mortgaged Property as of the origination of the Second Lien Loan.
Assignment and Conveyance Agreement: As defined in Subsection 6.01.
Assignment of Mortgage: 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.
Balloon Mortgage Loan: Any Mortgage Loan which by its original terms
or any modifications thereof provides for amortization beyond its scheduled
maturity date.
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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 State of New York
or the state in which the Interim Servicer's servicing operations are located,
are authorized or obligated by law or executive order to be closed.
Closing Date: The date or dates on which the Purchaser from time to
time shall purchase and the Seller from time to time shall sell the Mortgage
Loans listed on the related Mortgage Loan Schedule with respect to the related
Mortgage Loan Package.
CLTV: As of any date and as to (1) any Second Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the Second Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are senior or equal in
priority to the Second Lien Loan and which are secured by the same Mortgaged
Property to (b) the Appraised Value and (2) any First Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the First Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are junior or equal in
priority to the First Lien Loan and which are secured by the same Mortgaged
Property to (b) the Appraised Value.
Code: Internal Revenue Code of 1986, as amended.
Commission: The United States Securities and Exchange Commission.
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.
Convertible Mortgage Loan: Any individual Adjustable Rate Mortgage
Loan purchased pursuant to this Agreement which contains a provision whereby the
Mortgagor is permitted to convert the Adjustable Rate Mortgage Loan to a Fixed
Rate Mortgage Loan in accordance with the terms of the related Mortgage Note.
Covered Loan: A Mortgage Loan categorized as Covered pursuant to
Appendix E of Standard & Poor's Glossary.
Credit Files: As defined in Section 5 herein.
Custodial Account: The separate account or accounts created and
maintained pursuant to Section 2.04 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Custodial Agreement: The agreement governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other
Mortgage Loan Documents, to be executed between the Purchaser and the Custodian
and to be dated as of the related Cut-Off Date.
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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 therein provided. If at any time there is no Custodial
Agreement in effect with respect to a Mortgage Loan, all references to the
Custodian herein and in the Interim Servicing Agreement shall be deemed to refer
to the Purchaser (or its designee) with respect to such Mortgage Loan.
Cut-off Date: The date or dates designated as such on the related
Mortgage Loan Schedule with respect to the related Mortgage Loan Package.
Deemed MaterialBreach Representation: Each representation identified
as such in Section 9.02 of this Agreement.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased or replaced
or to be replaced with a Qualified Substitute Mortgage Loan by the Seller in
accordance with the terms of this Agreement.
Delinquency Collection Policies and Procedures: The delinquency
collection policies and procedures of the Seller, a copy of which is attached to
the Interim Servicing Agreement.
Depositor: The depositor, as such term is defined in Regulation AB,
with respect to any Securitization Transaction.
Determination Date: The date specified in the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
Due Date: The day of the month on which the Monthly Payment is due on
a Mortgage Loan, exclusive of any days of grace.
Eligible Account: Any of (i) an account maintained with a federal or
state chartered depository institution or trust company the short-term unsecured
debt obligations of which (or, in the case of a depository institution or trust
company 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 or
Prime-1 by Moody's (or a comparable rating if another Rating Agency is specified
by the Purchaser by written notice to the Seller) at the time any amounts are
held on deposit therein, (ii) an account or accounts the deposits in which are
fully insured by the FDIC, or (iii) a trust account or accounts maintained with
a federal or state chartered depository institution or trust company acting in
its fiduciary capacity.
Escrow Account: The separate account or accounts created and
maintained pursuant to Section 2.06 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
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 document.
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Exchange Act: The Securities Exchange Act of 1934, as amended.
Xxxxxx Mae: The Federal National Mortgage Association and its
successors in interest.
Xxxxxx Xxx Guides: The Xxxxxx Xxx Xxxxxxx' Guide and the Xxxxxx Xxx
Servicers' Guide and all amendments or additions thereto.
Xxxxxx Mae Transfer: As defined in Section 13 hereof.
FDIC: The Federal Deposit Insurance Corporation and its successors in
interest.
FHA: The Federal Housing Administration, an agency within the United
States Department of Housing and Urban Development and its successors in
interest and including the Federal Housing Commissioner and the Secretary of
Housing and Urban Development where appropriate under the FHA Regulations.
First Lien Loan: Any Mortgage Loan secured by a first lien Mortgage on
the related Mortgaged Property.
Fitch: Fitch Inc. and its successors in interest.
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 in interest.
Xxxxxxx Mac Transfer: As defined in Section 13 hereof.
GEMICO: General Electric Mortgage Insurance Corporation, a North
Carolina corporation and its successors in interest.
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 (a) covered by the Home Ownership and
Equity Protection Act of 1994, (b) classified as a "high cost home,"
"threshold," "covered," "high risk home," "predatory" or similar loan under any
other applicable state, federal or local law (or a similarly classified loan
using different terminology under a law imposing heightened regulatory scrutiny
or additional legal liability for residential mortgage loans having high
interest rates, points and/or fees) or (c) categorized as High Cost pursuant to
Appendix E of Standard & Poor's Glossary. For avoidance of doubt, the parties
agree that this definition shall apply to any law regardless of whether such law
is presently, or in the future becomes, the subject of judicial review or
litigation.
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Home Loan: A Mortgage Loan categorized as Home Loan pursuant to
Appendix E of Standard & Poor's Glossary.
HUD: The Department of Housing and Urban Development, or any federal
agency or official thereof which may from time to time succeed to the functions
thereof with regard to FHA Mortgage Insurance. The term "HUD," for purposes of
this Agreement, is also deemed to include subdivisions thereof such as the FHA
and Government National Mortgage Association.
Index: With respect to each Adjustable Rate Mortgage Loan, a rate per
annum set forth on Exhibit B to each related Assignment and Conveyance
Agreement.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
Interest Rate Adjustment Date: With respect to each Adjustable Rate
Mortgage Loan, the date, specified in the related Mortgage Note and the Mortgage
Loan Schedule, on which the Mortgage Interest Rate is adjusted.
Interim Funder: With respect to each MERS Designated Mortgage Loan,
the Person named on the MERS(R) System as the interim funder pursuant to the
MERS Procedures Manual.
Interim Servicer: First Banc Mortgage, Inc., a Missouri corporation,
and its successors in interest, and any successor interim servicer under the
Interim Servicing Agreement.
Interim Servicing Agreement: The agreement, attached as Exhibit B
hereto, to be entered into by the Purchaser and the Interim Servicer, providing
for the Interim Servicer to service the Mortgage Loans for an interim period as
specified by the Interim Servicing Agreement.
Investor: With respect to each MERS Designated Mortgage Loan, the
Person named on the MERS(R) System as the investor pursuant to the MERS
Procedures Manual.
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 related Mortgage Loan Schedule.
Liquidation Proceeds: Cash 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 or otherwise, or the sale of the
related Mortgaged Property if the Mortgaged Property is acquired in satisfaction
of the Mortgage Loan.
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Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan, the
ratio (expressed as a percentage) of the outstanding principal amount of the
Mortgage Loan as of the Cut-off Date (unless otherwise indicated), to the
Appraised Value of the Mortgaged Property.
MERS: MERSCORP, Inc., its successors and assigns.
MERS Designated Mortgage Loan: Mortgage Loans for which (a) the Seller
has designated or will designate MERS as, and has taken or will take such action
as is necessary to cause MERS to be, the mortgagee of record, as nominee for the
Seller, in accordance with MERS Procedure Manual and (b) the Seller has
designated or will designate the Purchaser as the Investor on the MERS(R)
System.
MERS Procedure Manual: The MERS Procedures Manual, as it may be
amended, supplemented or otherwise modified from time to time.
MERS Report: The report from the MERS System listing MERS Designated
Mortgage Loans and other information.
MERS(R) System: MERS mortgage electronic registry system, as more
particularly described in the MERS Procedures Manual.
Monthly Payment: The scheduled monthly payment of principal and
interest on a Mortgage Loan.
Moody's: Xxxxx'x Investors Service, Inc. and its successors in
interest.
Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note, which creates a first lien, in the case of a First Lien Loan, or
a second lien, in the case of a Second Lien Loan, on an unsubordinated estate in
fee simple in real property securing the Mortgage Note; except that with respect
to real property located in jurisdictions in which the use of leasehold estates
for residential properties is a widely accepted practice, the mortgage, deed of
trust or other instrument securing the Mortgage Note may secure and create a
first lien, in the case of a First Lien Loan, or a second lien, in the case of a
Second Lien Loan, upon a leasehold estate of the Mortgagor.
Mortgage File: The items pertaining to a particular Mortgage Loan
referred to in Exhibit A 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 with respect to each Mortgage Loan.
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 applicable Mortgage Loan Schedule, which Mortgage Loan
includes without limitation the Mortgage File, the Monthly Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
Servicing Rights, and all other rights, benefits,
-7-
proceeds and obligations arising from or in connection with such Mortgage Loan,
excluding replaced or repurchased mortgage loans.
Mortgage Loan Documents: The documents required to be delivered to the
Custodian pursuant to Section 6.03 hereof with respect to any Mortgage Loan.
Mortgage Loan Package: Each pool of Mortgage Loans, which shall be
purchased by the Purchaser from the Seller from time to time on each Closing
Date.
Mortgage Loan Schedule: The schedule of Mortgage Loans setting forth
the following information with respect to each Mortgage Loan in the related
Mortgage Loan Package: (1) the Seller's Mortgage Loan identifying number; (2)
the Mortgagor's name; (3) the street address of the Mortgaged Property including
the city, state and zip code; (4) a code indicating whether the Mortgaged
Property is owner-occupied, a second home or investment property; (5) the number
and type of residential units constituting the Mortgaged Property (i.e., a
single family residence, a 2-4 family residence, a unit in a condominium project
or a unit in a planned unit development, manufactured housing); (6) the Mortgage
Loan origination date; (7) the original months to maturity or the remaining
months to maturity from the related Cut-off Date, in any case based on the
original amortization schedule and, if different, the maturity expressed in the
same manner but based on the actual amortization schedule; (8) the Loan-to-Value
Ratio at origination; (9) with respect to First Lien Loans, the LTV and with
respect to Second Lien Loans, the CLTV; (10) the Mortgage Interest Rate as of
the related Cut-off Date; (11) the date on which the Monthly Payment was due on
the Mortgage Loan and, if such date is not consistent with the Due Date
currently in effect, such Due Date; (12) the stated maturity date; (13) the
amount of the Monthly Payment as of the related Cut-off Date; (14) the last
payment date as of which a payment was actually applied to the outstanding
principal balance; (15) the original principal amount of the Mortgage Loan; (16)
the principal balance of the Mortgage Loan as of the close of business on the
related Cut-off Date, after deduction of payments of principal due and collected
on or before the Cut-off Date; (17) the Interest Rate Adjustment Date; (18) the
Gross Margin; (19) the Lifetime Rate Cap under the terms of the Mortgage Note;
(20) a code indicating the type of Index; (21) the Mortgage Interest Rate as of
origination; (22) the type of Mortgage Loan (i.e., fixed-rate, adjustable-rate,
First Lien, Second Lien); (23) a code indicating the purpose of the loan (i.e.,
purchase, rate and term refinance, equity take-out refinance); (24) a code
indicating the documentation style (i.e., full or stated income); (25) the loan
credit classification (as described in the Underwriting Guidelines); (26) the
applicable Cut-off Date; (27) the applicable Closing Date; (28) a code
indicating whether the Mortgage Loan is a Home Loan; (29) the credit risk score
(FICO score); (30) with respect to the related Mortgagor, the debt-to-income
ratio; (31) with respect to Second Lien Loans, the outstanding principal balance
of the superior lien; (32) the Appraised Value of the Mortgaged Property; (33)
the sale price of the Mortgaged Property if the Mortgage Loan was originated in
connection with the purchase of the Mortgaged Property; (34) the Periodic Rate
Cap under the terms of the Mortgage Note; (35) the Periodic Rate Floor under the
terms of the Mortgage Note; (36) whether such Mortgage Loan provides for a
prepayment penalty; (37) the prepayment penalty period of such Mortgage Loan, if
applicable; (38) a description of the type of prepayment penalty, if applicable;
(39) the MERS Identification Number; (40) whether the Mortgagor represented that
the Mortgagor would occupy the Mortgaged Property as its primary residence; and
(41) a code indicating if the Mortgage Loan is a Balloon Mortgage Loan. With
respect to the Mortgage Loans in the
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aggregate, the Mortgage Loan Schedule shall set forth the following information,
as of the related Cut-off Date: (1) the number of Mortgage Loans; (2) the
current aggregate outstanding principal balance of the Mortgage Loans; (3) the
weighted average Mortgage Interest Rate of the Mortgage Loans; and (4) the
weighted average maturity of the Mortgage Loans.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
Mortgaged Property: The real property (or leasehold estate, if
applicable) securing repayment of the debt evidenced by a Mortgage Note.
Mortgagor: The obligor on a Mortgage Note.
OCC: Office of the Comptroller of the Currency and its successors in
interest.
Officer's Certificate: A certificate signed by the Chairman of the
Board or the Vice Chairman of the Board or a President or a Vice President and
by the Treasurer or the Secretary or one of the Assistant Treasurers or
Assistant Secretaries of the Seller, and delivered to the Purchaser as required
by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel
for the Seller, reasonably acceptable to the Purchaser, provided that any
Opinion of Counsel relating to (a) the qualification of any account required to
be maintained pursuant to this Agreement as an Eligible Account, (b)
qualification of the Mortgage Loans in a REMIC or (c) compliance with the REMIC
Provisions, must be (unless otherwise stated in such Opinion of Counsel) an
opinion of counsel who (i) is in fact independent of the Seller and any servicer
of the Mortgage Loans, (ii) does not have any material direct or indirect
financial interest in the Seller or any servicer of the Mortgage Loans or in an
Affiliate of either and (iii) is not connected with the Seller or any servicer
of the Mortgage Loans as an officer, employee, director or person performing
similar functions.
OTS: Office of Thrift Supervision and its successors in interest.
Periodic Rate Cap: 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 increase on an Interest
Rate Adjustment Date above the Mortgage Interest Rate previously in effect.
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.
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.
Preliminary Mortgage Schedule: As defined in Section 3.
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Premium Percentage: With respect to any Mortgage Loan, a percentage
equal to the excess of the Purchase Price Percentage over 100%.
Principal Prepayment: Any payment or other recovery of principal on a
Mortgage Loan 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.
Purchase Price: The price paid on the related Closing Date by the
Purchaser to the Seller in exchange for the Mortgage Loans purchased on such
Closing Date as calculated in Section 4 of this Agreement.
Purchase Price and Terms Agreement: Those certain agreements setting
forth the general terms and conditions of the transaction consummated herein and
identifying the Mortgage Loans to be purchased from time to time hereunder, by
and among the Seller, the Purchaser and the Interim Servicer (if applicable).
All of the individual Purchase Price and Terms Agreements shall collectively be
referred to as the "Purchase Price and Terms Agreement."
Purchase Price Percentage: With respect to any Mortgage Loan, an
amount equal to the percentage of par as stated in the Purchase Price and Terms
Agreement (subject to adjustment as provided therein) related to such Mortgage
Loan.
Purchaser: IXIS Real Estate Capital Inc., a New York corporation, and
its successors in interest and assigns, or any successor to the Purchaser under
this Agreement as herein provided.
Qualified Correspondent: Any Person from which the Seller purchased
Mortgage Loans, provided that the following conditions are satisfied: (i) such
Mortgage Loans were originated pursuant to an agreement between the Seller and
such Person that contemplated that such Person would underwrite mortgage loans
from time to time, for sale to the Seller, in accordance with underwriting
guidelines designated by the Seller ("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 Seller within 180 days after origination; (iii) either (x) the Designated
Guidelines were, at the time such Mortgage Loans were originated, used by the
Seller in origination of mortgage loans of the same type as the Mortgage Loans
for the Seller's own account or (y) the Designated Guidelines were, at the time
such Mortgage Loans were underwritten, designated by the Seller on a consistent
basis for use by lenders in originating mortgage loans to be purchased by the
Seller; and (iv) the Seller employed, at the time such Mortgage Loans were
acquired by the Seller, pre purchase or post purchase quality assurance
procedures (which may involve, among other things, review of a sample of
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 Seller.
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Qualified Substitute Mortgage Loan: A mortgage loan eligible to be
substituted by the Seller for a Deleted Mortgage Loan which must, on the date of
such substitution, (i) have an outstanding principal balance, after deduction of
all scheduled payments due in the month of substitution (or in the case of a
substitution of more than one mortgage loan for a Deleted Mortgage Loan, an
aggregate principal balance), not in excess of the outstanding principal balance
of the Deleted Mortgage Loan (the amount of any shortfall will be deposited in
the Custodial Account by the Seller in the month of substitution); (ii) have a
Mortgage Interest Rate not less than and not more than 1% greater than the
Mortgage Interest Rate of the Deleted Mortgage Loan; (iii) have a remaining term
to maturity not greater than and not more than one year less than that of the
Deleted Mortgage Loan; (iv) be of the same type as the Deleted Mortgage Loan
(i.e., fixed-rate, adjustable-rate with same Periodic Rate Cap, Index and lien
priority); and (v) comply with each representation and warranty (respecting
individual Mortgage Loans) set forth in Section 9 hereof.
Rating Agency: Any of Fitch, Xxxxx'x or Standard & Poor's, or their
respective successors designated by the Purchaser.
Reconstitution: Any Securitization Transaction or Whole Loan Transfer.
Reconstitution Agreements: The agreement or agreements entered into by
the Seller and/or the Interim Servicer and the Purchaser and/or certain third
parties on the Reconstitution Date or Dates with respect to any or all of the
Mortgage Loans sold hereunder, in connection with a Whole Loan Transfer, Agency
Transfer or a Securitization Transaction pursuant to Section 13, including, but
not limited to, a seller's warranties and servicing agreement with respect to a
Whole Loan Transfer, and a trust and servicing agreement, pooling and servicing
agreement and/or seller/servicer agreements and related custodial/trust
agreement and documents with respect to a Securitization Transaction.
Reconstitution Date: As defined in Section 13.
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. Sections 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 Date: The date specified in the Interim Servicing Agreement
(with respect to each Mortgage Loan, for an interim period, as specified
therein).
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Repurchase Price: With respect to any Mortgage Loan for which a breach
of a representation or warranty from the Agreement or the Interim Servicing
Agreement is found, a price equal to the then outstanding principal balance of
the Mortgage Loan to be repurchased, plus accrued interest thereon at the
Mortgage Interest Rate from the date to which interest had last been paid
through the date of such repurchase, plus the amount of any outstanding advances
owed to any servicer, and plus all costs and expenses incurred by the Purchaser
or any servicer arising out of or based upon such breach, including without
limitation costs and expenses incurred in the enforcement of the Seller's
repurchase obligation hereunder.
RESPA: Real Estate Settlement Procedures Act, as amended from time to
time.
Second Lien Loan: A Mortgage Loan secured by a second lien Mortgage on
the related Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Securitization Transaction: Any transaction involving either (1) 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 (2)
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.
Seller: First Banc Mortgage, Inc., a Missouri corporation, and its
successors in interest.
Seller Information: As defined in Subsection 31.04(a).
Servicing Fee: With respect to each Mortgage Loan subject to the
Interim Servicing Agreement, an amount equal to 0.50% per annum computed on the
basis of the outstanding principal balance of the related Mortgage Loan. Such
fee shall be payable monthly and shall be pro rated for any portion of a month
during which the Mortgage Loan is serviced by the Interim Servicer under the
Interim Servicing Agreement. 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 this Agreement) of such Monthly Payment
collected by the Interim Servicer, or as otherwise provided under this
Agreement.
Servicing File: With respect to each Mortgage Loan, the file retained
by the Interim Servicer consisting of originals of all documents in the Mortgage
File which are not delivered to the Purchaser or the Custodian and copies of the
Mortgage Loan Documents.
Servicing Rights: Any and all of the following: (a) any and all rights
to service the Mortgage Loans; (b) any payments to or monies received by the
Interim Servicer for servicing the Mortgage Loans; (c) any late fees, penalties
or similar payments with respect to the Mortgage Loans; (d) all agreements or
documents creating, defining or evidencing any such servicing rights to the
extent they relate to such servicing rights and all rights of the Interim
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Servicer thereunder; (e) Escrow Payments or other similar payments with respect
to the Mortgage Loans and any amounts actually collected by the Interim Servicer
with respect thereto; (f) all accounts and other rights to payment related to
any of the property described in this paragraph; and (g) any and all documents,
files, records, servicing files, servicing documents, servicing records, data
tapes, computer records, or other information pertaining to the Mortgage Loans
or pertaining to the past, present or prospective servicing of the Mortgage
Loans.
Sponsor: The sponsor, as such term is defined in Regulation AB, with
respect to any Securitization Transaction.
Standard & Poor's: Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies Inc., and its successors in interest.
Standard & Poor's Glossary: The Standard & Poor's LEVELS(R) Glossary,
as may be in effect from time to time.
Stated Principal Balance: As to each Mortgage Loan on any date of
determination, (i) the principal balance of such Mortgage Loan at the related
Cut-off Date after giving effect to payments of principal due on or before such
date, to the extent actually received, minus (ii) all amounts previously
distributed to the Purchaser with respect to the related Mortgage Loan
representing payments or recoveries of principal on such Mortgage Loan.
Static Pool Information: Static pool information as described in Item
1105(a)(1)-(3) and 1105(c) of Regulation AB.
Successor Servicer: Any servicer of one or more Mortgage Loans
designated by the Purchaser as being entitled to the benefits of the
indemnifications set forth in Sections 9.03 and 14.01.
Third Party Originator: Each Person, other than a Qualified
Correspondent, that originated Mortgage Loans acquired by the Seller.
Transfer Date: The date on which the Purchaser, or its designee, shall
receive the transfer of servicing responsibilities and begin to perform the
servicing of the Mortgage Loans with respect to the related Mortgage Loan
Package, and the Interim Servicer shall cease all servicing responsibilities.
Such date shall occur on the day indicated by the Purchaser to the Interim
Servicer in accordance with the Interim Servicing Agreement.
Underwriting Guidelines: The underwriting guidelines of the Seller, a
copy of which is attached hereto as Exhibit I and a then-current copy of which
shall be attached as an exhibit to the related Assignment and Conveyance.
VA: The Department of Veterans Affairs, an agency of the United States
of America, or any successor thereto including the Administrator of Veterans
Affairs.
Whole Loan Transfer: Any sale or transfer of some or all of the
Mortgage Loans, other than a Securitization Transaction.
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SECTION 2. Agreement to Purchase.
The Seller agrees to sell from time to time, and the Purchaser agrees
to purchase from time to time, Mortgage Loans having an aggregate principal
balance on the related Cut-off Date in an amount as set forth in the related
Purchase Price and Terms Agreement, or in such other amount as agreed by the
Purchaser and the Seller as evidenced by the actual aggregate principal balance
of the Mortgage Loans accepted by the Purchaser on each Closing Date. SECTION 3.
Mortgage Schedules.
The Seller from time to time shall provide the Purchaser with certain
information constituting a preliminary listing of the Mortgage Loans to be
purchased on each Closing Date in accordance with the related Purchase Price and
Terms Agreement and this Agreement (each, a "Preliminary Mortgage Schedule").
The Seller is obligated to deliver those Mortgage Loans funded by the
Seller pursuant to the original terms of the Seller's commitment to the
mortgagor. The Seller shall deliver the Mortgage Loan Schedule for the Mortgage
Loans to be purchased on a particular Closing Date to the Purchaser at least two
(2) Business Days prior to the related Closing Date. The Mortgage Loan Schedule
shall be the related Preliminary Mortgage Schedule with those Mortgage Loans
which the Seller has not funded prior to the related Closing Date deleted.
SECTION 4. Purchase Price.
The Purchase Price for the Mortgage Loans shall be equal to (a) the
Purchase Price Percentage multiplied by the Cut-off Date Balance, plus (b)
accrued and unpaid interest on such principal balance at the weighted average
Mortgage Interest Rate (net the Servicing Fee) of those Mortgage Loans from the
related Cut-off Date through the day prior to the related Closing Date,
inclusive. For purposes hereof, "Cut-off Date Balance" means the aggregate
principal balance, as of the related Cut-off Date, of the Mortgage Loans listed
on the related Mortgage Loan Schedule, after application of scheduled payments
of principal due on or before the related Cut-off Date, to the extent such
payments were actually received, together with any unscheduled principal
payments collected prior to the Cut-off Date; provided, however, that payments
of scheduled principal and interest paid prior to the Cut-off Date, but to be
applied on a due date beyond the related Cut-off Date, shall not be applied to
the principal balance as of the related Cut-off Date. If so provided in the
related Purchase Price and Terms Agreement, portions of the Mortgage Loans shall
be priced separately. The Purchase Price as so determined shall be paid to the
Seller on the related Closing Date by wire transfer of immediately available
funds to an account designated by the Seller in writing.
In addition to the Purchase Price as described above, the Purchaser
shall pay to the Seller, at closing, accrued interest on the current principal
amount of the related Mortgage Loans as of the Cut-off Date at the weighted
average Mortgage Interest Rate of those Mortgage Loans, minus any amounts
attributable to Servicing Fees as provided in the Interim Servicing Agreement
from the related Cut-off Date through the day prior to the related Closing Date,
inclusive. The Purchase Price plus accrued interest as set forth in the
preceding paragraph shall
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be paid to the Seller by wire transfer of immediately available funds to an
account designated by the Seller in writing.
The Purchaser shall be entitled to (l) all principal paid after the
related Cut-off Date, (2) all other recoveries of principal collected on or
after the related Cut-off Date, and (3) all payments of interest on the Mortgage
Loans net of applicable Servicing Fees (minus that portion of any such payment
which is allocable to the period prior to the related Cut-off Date). The
outstanding principal balance of each Mortgage Loan as of the related Cut-off
Date is determined after application of payments of principal due on or before
the related Cut-off Date, to the extent actually collected, together with any
unscheduled principal prepayments collected prior to the Cut-off Date; provided,
however, that payments of scheduled principal and interest paid prior to the
Cut-off Date, but to be applied on a due date beyond the related Cut-off Date
shall not be applied to the principal balance as of the related Cut-off Date.
Such prepaid amounts shall be the property of the Purchaser. The Seller 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
Seller to the Purchaser.
SECTION 5. Examination of Mortgage Files.
At least seven (7) Business Days prior to the related Closing Date,
the Seller shall (i) either (a) deliver to the Purchaser or its designee in
escrow, for examination with respect to each Mortgage Loan to be purchased, the
related Mortgage File, including a copy of the Assignment of Mortgage (except
with respect to each MERS Designated Mortgage Loan), pertaining to each Mortgage
Loan, or (b) make the related Mortgage File available to the Purchaser for
examination at such other location as shall otherwise be acceptable to the
Purchaser and (ii) deliver to the Purchaser copies of the credit and servicing
files (collectively, the "Credit Files"). Such examination of the Mortgage Files
may be made by the Purchaser or its designee at any reasonable time before or
after the related Closing Date. If the Purchaser makes such examination prior to
the related Closing Date and determines, in its sole discretion, that any
Mortgage Loans are unacceptable to the Purchaser for any reason, such Mortgage
Loans shall be deleted from the related Mortgage Loan Schedule, and may be
replaced by a Qualified Substitute Mortgage Loan (or Loans) acceptable to the
Purchaser. The Purchaser may, at its option and without notice to the Seller,
purchase some or all of the Mortgage Loans without conducting any partial or
complete examination. The fact that the Purchaser or its designee has conducted
or has failed to conduct any partial or complete examination of the Mortgage
Files or the Credit Files shall not impair in any way the Purchaser's (or any of
its successor's) rights to demand repurchase, substitution or other remedy as
provided in this Agreement. In the event that the Seller fails to deliver the
Credit Files with respect to any Mortgage Loan, the Seller shall, upon the
request of the Purchaser, repurchase such Mortgage Loan at the price and in the
manner specified in Subsection 9.03.
SECTION 6. Conveyance from Seller to Purchaser.
Subsection 6.01 Conveyance of Mortgage Loans; Possession of Servicing
Files.
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The Seller, simultaneously with the delivery of the Mortgage Loan
Schedule with respect to the related Mortgage Loan Package to be purchased on
each Closing Date, shall execute and deliver an Assignment and Conveyance
Agreement in the form attached hereto as Exhibit H (the "Assignment and
Conveyance Agreement"). The Seller shall cause the Servicing File retained by
the Interim Servicer pursuant to this Agreement to be appropriately identified
in the Seller's computer system and/or books and records, as appropriate, to
clearly reflect the sale of the related Mortgage Loan to the Purchaser. The
Seller shall cause the Interim Servicer to release from its custody the contents
of any Servicing File retained by it only in accordance with this Agreement or
the Interim Servicing Agreement, except when such release is required in
connection with a repurchase of any such Mortgage Loan pursuant to Subsection
9.03.
Subsection 6.02 Books and Records.
Record title to each Mortgage as of the related Closing Date shall be
in the name of the Seller, the Purchaser or one or more designees of the
Purchaser, as the Purchaser shall select. Notwithstanding the foregoing, each
Mortgage and related Mortgage Note shall be possessed solely by the Purchaser or
the appropriate designee of the Purchaser, as the case may be. All rights
arising out of the Mortgage Loans including, but not limited to, all funds
received by the Seller or the Interim Servicer after the related Cut-off Date on
or in connection with a Mortgage Loan shall be vested in the Purchaser or one or
more designees of the Purchaser; provided, however, that all funds received on
or in connection with a Mortgage Loan shall be received and held by the Seller
or the Interim Servicer in trust for the benefit of the Purchaser or the
appropriate designee of the Purchaser, as the case may be, as the owner of the
Mortgage Loans pursuant to the terms of this Agreement.
The sale of each Mortgage Loan shall be reflected on the Seller's
balance sheet and other financial statements as a sale of assets by the Seller.
The Seller shall or shall cause the Interim Servicer to 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 Seller shall or shall
cause the Interim Servicer to maintain in its possession, available for
inspection by the Purchaser, 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 Xxx or Xxxxxxx Mac, including but not
limited to documentation as to the method used in determining the applicability
of the provisions of the National Flood Insurance Act of 1968, as amended, to
the Mortgaged Property, documentation evidencing insurance coverage and periodic
inspection reports, as required by the Xxxxxx Mae Guides. To the extent that
original documents are not required for purposes of realization of Liquidation
Proceeds or Insurance Proceeds, documents maintained by the Seller or the
Interim Servicer may be in the form of microfilm or microfiche so long as the
Seller or the Interim Servicer complies with the requirements of the Xxxxxx Xxx
Guides.
Subsection 6.03 Delivery of Mortgage Loan Documents.
The Seller shall deliver and release to the Custodian no later than
seven (7) Business Days prior to the related Closing Date those Mortgage Loan
Documents set forth on
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Exhibit A hereto with respect to each Mortgage Loan set forth on the related
Mortgage Loan Schedule.
The Custodian shall certify its receipt of all such Mortgage Loan
Documents required to be delivered pursuant to the Custodial Agreement for the
related Closing Date, as evidenced by the Certification and Trust Receipt of the
Custodian in the form annexed to the Custodial Agreement. The Purchaser shall
pay all fees and expenses of the Custodian from and after the Closing Date.
The Seller shall or shall cause the Interim Servicer to forward to the
Custodian, or to such other Person as the Purchaser shall designate in writing,
original documents evidencing an assumption, modification, consolidation or
extension of any Mortgage Loan entered into in accordance with this Agreement
within two weeks of their execution, provided, however, that the Seller shall
provide the Custodian, or to such other Person as the Purchaser shall designate
in writing, with a certified true copy of any such document submitted for
recordation within two weeks of its execution, and shall promptly 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 ninety days of its submission for recordation.
In the event any document required to be delivered to the Custodian
pursuant to the previous paragraph, including an original or copy of any
document submitted for recordation to the appropriate public recording office,
is not so delivered to the Custodian, or to such other Person as the Purchaser
shall designate in writing, within 90 days following the Closing Date (other
than with respect to the Assignments of Mortgage which shall be delivered to the
Custodian in blank and recorded subsequently by the Purchaser or its designee),
and in the event that the Seller does not cure such failure within 30 days of
discovery or receipt of written notification of such failure from the Purchaser,
the related Mortgage Loan shall, upon the request of the Purchaser, be
repurchased by the Seller at the price and in the manner specified in Subsection
9.03. The foregoing repurchase obligation shall not apply in the event that the
Seller cannot deliver such original or copy of any document submitted for
recordation to the appropriate public recording office within the specified
period due to a delay caused by the recording office in the applicable
jurisdiction, provided that (i) the Seller shall deliver a recording receipt of
such recording office or, if such recording receipt is not available, an
officer's certificate of a servicing officer of the Seller, confirming that such
documents have been accepted for recording (upon request of the Purchaser and
delivery by the Purchaser to the Seller of a schedule of the related Mortgage
Loans, the Seller shall reissue and deliver to the Purchaser or its designee
said officer's certificate relating to the related Mortgage Loans), and (ii)
such document is delivered within twelve (12) months of the related Closing
Date.
The Seller shall pay all initial recording fees, if any, for the
assignments of mortgage and any other fees or costs in transferring all original
documents to the Custodian or, upon written request of the Purchaser, to the
Purchaser or the Purchaser's designee. The Purchaser or the Purchaser's designee
shall be responsible for recording the Assignments of Mortgage and shall be
reimbursed by the Seller for the costs associated therewith pursuant to the
preceding sentence.
Subsection 6.04 Quality Control Procedures.
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The Seller shall, or shall cause the Interim Servicer to, have an
internal quality control program that verifies in a manner consistent with
accepted industry procedures, on a regular basis, the existence and accuracy of
the legal documents, credit documents, property appraisals, and underwriting
decisions. The program shall include evaluating and monitoring the overall
quality of the Seller's loan production and the servicing activities of the
Interim Servicer. The program is to ensure that the Mortgage Loans are
originated and serviced in accordance with Accepted Servicing Practices and the
Underwriting Guidelines; guard against dishonest, fraudulent, or negligent acts;
and guard against errors and omissions by officers, employees, or other
authorized persons.
Subsection 6.05 MERS Designated Mortgage Loans.
With respect to each MERS Designated Mortgage Loan, the Seller shall,
on or prior to the related Closing Date, designate the Purchaser as the Investor
and the Custodian as custodian, and no Person shall be listed as Interim Funder
on the MERS System. In addition, on or prior to the related Closing Date, Seller
shall provide the Custodian and the Purchaser with a MERS Report listing the
Purchaser as the Investor, the Custodian as custodian and no Person as Interim
Funder with respect to each MERS Designated Mortgage Loan.
SECTION 7. Servicing of the Mortgage Loans.
The Mortgage Loans have been sold by the Seller to the Purchaser on a
servicing released basis. Subject to, and upon the terms and conditions of this
Agreement and the Interim Servicing Agreement (with respect to each Mortgage
Loan, for an interim period, as specified therein), the Seller hereby sells,
transfers, assigns, conveys and delivers to the Purchaser the Servicing Rights.
The Purchaser shall retain the Interim Servicer as contract servicer
of the Mortgage Loans for an interim period pursuant to and in accordance with
the terms and conditions contained in the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Except as set forth in the Interim Servicing Agreement, the Interim Servicer
shall service the Mortgage Loans on an "actual/actual" basis and otherwise in
strict compliance with the servicing provisions related to the Xxxxxx Mae MBS
Program (Special Servicing Option) of the Xxxxxx Xxx Guides (except as otherwise
set forth in the Interim Servicing Agreement); provided, however, that in the
event that the Interim Servicer continues to service a Mortgage Loan after the
time when such Mortgage Loan is sold or transferred pursuant to a Securitization
Transaction, the Interim Servicer shall, at the Purchaser's option, service the
Mortgage Loans on a "scheduled/scheduled" basis. The Purchaser and Seller shall
cause the Interim Servicer to execute the Interim Servicing Agreement on the
initial Closing Date.
Pursuant to the Interim Servicing Agreement (with respect to each
Mortgage Loan, for an interim period, as specified therein), the Interim
Servicer shall begin servicing the Mortgage Loans on behalf of the Purchaser and
shall be entitled to a Servicing Fee with respect to such Mortgage Loans until
the applicable Transfer Date. The Interim Servicer shall conduct such servicing
in accordance with the Interim Servicing Agreement.
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SECTION 8. Transfer of Servicing.
On the applicable Transfer Date, the Purchaser, or its designee, shall
assume all servicing responsibilities related to, and the Seller shall cause the
Interim Servicer to cease all servicing responsibilities related to, the related
Mortgage Loans subject to such Transfer Date. The Transfer Date shall be the
date determined in accordance with Section 6.02 of the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
On or prior to the applicable Transfer Date, the Seller shall, at its
sole cost and expense, take such steps as may be necessary or appropriate to
effectuate and evidence the transfer of the servicing of the related Mortgage
Loans to the Purchaser, or its designee, including but not limited to the
following:
(a) Notice to Mortgagors. The Seller shall cause the Interim Servicer
to mail to the Mortgagor of each related Mortgage Loan a letter advising such
Mortgagor of the transfer of the servicing of the related Mortgage Loan to the
Purchaser, or its designee, in accordance with the Xxxxxxxx Xxxxxxxx National
Affordable Housing Act of 1990; provided, however, the content and format of the
letter shall have the prior approval of the Purchaser. The Seller shall cause
the Interim Servicer to provide the Purchaser with copies of all such related
notices no later than the Transfer Date.
(b) Notice to Taxing Authorities and Insurance Companies. The Seller
shall cause the Interim Servicer to transmit to the applicable taxing
authorities and insurance companies (including primary mortgage insurance policy
insurers, if applicable) and/or agents, notification of the transfer of the
servicing to the Purchaser, or its designee, and instructions to deliver all
notices, tax bills and insurance statements, as the case may be, to the
Purchaser from and after the Transfer Date. The Seller shall cause the Interim
Servicer to provide the Purchaser with copies of all such notices no later than
the Transfer Date.
(c) Delivery of Servicing Records. The Seller shall cause the Interim
Servicer to forward to the Purchaser, or its designee, all servicing records and
the Servicing File in the Interim Servicer's possession relating to each related
Mortgage Loan including the information enumerated in the Interim Servicing
Agreement (with respect to each such Mortgage Loan, for an interim period, as
specified therein).
(d) Escrow Payments. The Seller shall cause the Interim Servicer to
provide the Purchaser, or its designee, with immediately available funds by wire
transfer in the amount of the net Escrow Payments and suspense balances and all
loss draft balances associated with the related Mortgage Loans. The Seller shall
cause the Interim Servicer to provide the Purchaser with an accounting
statement, in electronic format acceptable to the Purchaser in its sole
discretion, of Escrow Payments and suspense balances and loss draft balances
sufficient to enable the Purchaser to reconcile the amount of such payment with
the accounts of the Mortgage Loans. Additionally, the Seller shall cause the
Interim Servicer to wire transfer to the Purchaser the amount of any agency,
trustee or prepaid Mortgage Loan payments and all other similar amounts held by
the Interim Servicer.
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(e) Payoffs and Assumptions. The Seller shall cause the Interim
Servicer to provide to the Purchaser, or its designee, copies of all assumption
and payoff statements generated by the Interim Servicer on the related Mortgage
Loans from the related Cut-off Date to the Transfer Date.
(f) Mortgage Payments Received Prior to Transfer Date. Prior to the
Transfer Date all payments received by the Interim Servicer or the Seller on
each related Mortgage Loan shall be properly applied by the Seller to the
account of the particular Mortgagor.
(g) Mortgage Payments Received after Transfer Date. The amount of any
related Monthly Payments received by the Seller after the Transfer Date shall be
forwarded to the Purchaser by overnight mail on the date of receipt. The Seller
shall notify the Purchaser of the particulars of the payment, which notification
requirement shall be satisfied if the Seller forwards with its payment
sufficient information to permit appropriate processing of the payment by the
Purchaser. The Seller shall assume full responsibility for the necessary and
appropriate legal application of such Monthly Payments received by the Seller
after the Transfer Date with respect to related Mortgage Loans then in
foreclosure or bankruptcy; provided, for purposes of this Agreement, necessary
and appropriate legal application of such Monthly Payments shall include, but
not be limited to, endorsement of a Monthly Payment to the Purchaser with the
particulars of the payment such as the account number, dollar amount, date
received and any special Mortgagor application instructions and the Seller shall
cause the Interim Servicer to comply with the foregoing requirements with
respect to all Monthly Payments received by the Interim Servicer after the
Transfer Date.
(h) Misapplied Payments. Misapplied payments shall be processed as
follows:
(i) All parties shall cooperate in correcting misapplication errors;
(i) The party receiving notice of a misapplied payment occurring prior
to the applicable Transfer Date and discovered after the Transfer Date
shall immediately notify the other party;
(ii) If a misapplied payment which occurred prior to the Transfer Date
cannot be identified and said misapplied payment has resulted in a shortage
in a Custodial Account or Escrow Account, the Seller shall be liable for
the amount of such shortage. The Seller shall reimburse the Purchaser for
the amount of such shortage within thirty (30) days after receipt of
written demand therefor from the Purchaser;
(iii) If a misapplied payment which occurred prior to the Transfer
Date has created an improper Purchase Price as the result of an inaccurate
outstanding principal balance, a check shall be issued to the party shorted
by the improper payment application within five (5) Business Days after
notice thereof by the other party; and
(iv) Any check issued under the provisions of this Section 8(h) shall
be accompanied by a statement indicating the corresponding Seller and/or
the Purchaser Mortgage Loan identification number and an explanation of the
allocation of any such payments.
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(v) Books and Records. On the Transfer Date, the books, records and
accounts of the Seller with respect to the related Mortgage Loans shall be
in accordance with all applicable Purchaser requirements.
(j) Reconciliation. The Seller shall, on or before the Transfer Date,
reconcile principal balances and make any monetary adjustments required by the
Purchaser. Any such monetary adjustments will be transferred between the Seller
and the Purchaser as appropriate.
(k) IRS Forms. The Seller shall or shall cause the Interim Servicer to
file all IRS forms 1099, 1099A, 1098 or 1041 and K-1 which are required to be
filed on or before the Transfer Date in relation to the servicing and ownership
of the related Mortgage Loans. The Seller shall provide copies of such forms to
the Purchaser upon request and shall reimburse the Purchaser for any costs or
penalties incurred by the Purchaser due to the Seller's failure to comply with
this paragraph.
SECTION 9. Representations, Warranties and Covenants of the Seller;
Remedies for Breach.
Subsection 9.01 Representations and Warranties Regarding the Seller.
The Seller represents, warrants and covenants to the Purchaser that as
of the date hereof and as of each Closing Date:
(a) Due Organization and Authority. The Seller is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Missouri 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 wherein
it owns or leases any material properties or 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 Seller, and in any event the
Seller 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 and the
Interim Servicing Agreement; the Seller has the full corporate power, authority
and legal right to hold, transfer and convey the Mortgage Loans and to execute
and deliver this Agreement and to perform its obligations hereunder and
thereunder; the execution, delivery and performance of this Agreement (including
all instruments of transfer to be delivered pursuant to this Agreement) by the
Seller and the consummation of the transactions contemplated hereby and thereby
have been duly and validly authorized; this Agreement and all agreements
contemplated hereby have been duly executed and delivered and constitute the
valid, legal, binding and enforceable obligations of the Seller, regardless of
whether such enforcement is sought in a proceeding in equity or at law; and all
requisite corporate or other action has been taken by the Seller to make this
Agreement and all agreements contemplated hereby valid and binding upon the
Seller in accordance with their terms;
(b) Ordinary Course of Business. The consummation of the transactions
contemplated by this Agreement are in the ordinary course of business of the
Seller, and the transfer, assignment and conveyance of the Mortgage Notes and
the Mortgages by the Seller
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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 or origination of the Mortgage Loans by the Seller,
the sale of the Mortgage Loans to the Purchaser, the consummation of the
transactions contemplated hereby and thereby, 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, conditions or provisions of the
Seller's charter, by-laws or other organizational documents or any legal
restriction or any agreement or instrument to which the Seller is now a party or
by which it is bound, or constitute a default or result in an acceleration under
any of the foregoing, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Seller or its property is subject, or
result in the creation or imposition of any lien, charge or encumbrance that
would have an adverse effect upon any of its properties pursuant to the terms of
any mortgage, contract, deed of trust or other instrument, or impair the ability
of the Purchaser to realize on the Mortgage Loans, impair the value of the
Mortgage Loans, or impair the ability of the Purchaser to realize the full
amount of any insurance benefits accruing pursuant to this Agreement;
(d) Ability to Service. The Interim Servicer has the facilities,
procedures, and experienced personnel necessary for the sound servicing of
mortgage loans of the same type as the Mortgage Loans. The Interim Servicer is
duly qualified, licensed, registered and otherwise authorized under all
applicable federal, state and local laws, and regulations, if applicable, meets
the minimum capital requirements set forth by the OTS, the OCC or the FDIC, and
is in good standing to enforce, originate, sell mortgage loans to, and service
mortgage loans in each jurisdiction wherein the Mortgaged Properties are
located;
(e) Reasonable Servicing Fee. The Seller 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 Interim
Servicer, for accounting and tax purposes, as compensation for the servicing and
administration of the Mortgage Loans pursuant to this Agreement and the Interim
Servicing Agreement;
(f) Ability to Perform; Solvency. The Seller 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 Seller is solvent and the sale
of the Mortgage Loans will not cause the Seller to become insolvent. The sale of
the Mortgage Loans is not undertaken with the intent to hinder, delay or defraud
any of Seller's creditors;
(g) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or threatened against the Seller, before any court,
administrative agency or other tribunal asserting the invalidity of this
Agreement, seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or 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 Seller, or in any
material impairment of the right or ability of the Seller to carry on its
business substantially as now conducted, or in any material liability on the
part of the Seller, or which would draw into question the validity of this
Agreement or the Mortgage Loans or of any action taken or to be taken in
connection with the obligations of the
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Seller contemplated herein, or which would be likely to impair the ability of
the Seller to perform under the terms of this Agreement;
(h) No Consent Required. No consent, approval, authorization or order
of, or registration or filing with, or notice to any court or governmental
agency or body including HUD, the FHA or the Department of Veterans Affairs is
required for the execution, delivery and performance by the Seller of or
compliance by the Seller with this Agreement or the Mortgage Loans, the delivery
of a portion of the Mortgage Files to the Custodian or the sale of the Mortgage
Loans or the consummation of the transactions contemplated by this Agreement, or
if required, such approval has been obtained prior to the related Closing Date;
(i) Selection Process. The Mortgage Loans were selected from among the
outstanding one- to four-family mortgage loans in the Seller's portfolio at the
related Closing Date as to which the representations and warranties set forth in
Subsection 9.02 could be made and such selection was not made in a manner so as
to affect adversely the interests of the Purchaser;
(j) Mortgage Loan Package Characteristics. The characteristics of the
related Mortgage Loan Package are as set forth on the description of the pool
characteristics for the applicable Mortgage Loan Package delivered pursuant to
Section 11 on the related Closing Date in the form attached as Exhibit B to each
related Assignment and Conveyance Agreement;
(k) No Untrue Information. Neither this Agreement nor any information,
statement, tape, diskette, report, form, or other document furnished or to be
furnished pursuant to this Agreement or any Reconstitution Agreement or in
connection with the transactions contemplated hereby (including any
Securitization Transaction or Whole Loan Transfer) contains or will contain any
untrue statement of fact or omits or will omit to state a fact necessary to make
the statements contained herein or therein not misleading;
(l) Financial Statements. The Seller has delivered to the Purchaser
financial statements as to its last three complete fiscal years and any later
quarter ended more than 60 days prior to the execution of this Agreement. All
such financial statements fairly present the pertinent results of operations and
changes in financial position for each of such periods and the financial
position at the end of each such period of the Seller and its subsidiaries and
have been prepared in accordance with generally accepted accounting principles
of the United States consistently applied throughout the periods involved,
except as set forth in the notes thereto. In addition, the Seller has delivered
information as to its loan gain and loss experience in respect of foreclosures
and its loan delinquency experience for the immediately preceding three-year
period, in each case with respect to mortgage loans owned by it and mortgage
loans serviced for others during such period, and all such information so
delivered shall be true and correct in all material respects. There has been no
change in the business, operations, financial condition, properties or assets of
the Seller since the date of the Seller's financial statements that would have a
adverse effect on its ability to perform its obligations under this Agreement.
The Seller has completed any forms requested by the Purchaser in a timely manner
and in accordance with the provided instructions;
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(m) No Brokers. The Seller 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;
(n) Sale Treatment. The Seller has been advised by its independent
certified public accountants that under generally accepted accounting principles
the transfer of the Mortgage Loans may be treated as a sale on the books and
records of the Seller and the Seller has determined that the disposition of the
Mortgage Loans pursuant to this Agreement will be afforded sale treatment for
tax and accounting purposes;
(o) Reasonable Purchase Price. The consideration received by the
Seller upon the sale of the Mortgage Loans under this Agreement constitutes fair
consideration and reasonably equivalent value for the Mortgage Loans;
(p) Owner of Record. The Seller is the owner of record of each
Mortgage and the indebtedness evidenced by each Mortgage Note, and upon the sale
of the Mortgage Loans to the Purchaser, the Seller will retain the Mortgage
Files with respect thereto in trust only for the purpose of servicing and
supervising the servicing of each Mortgage Loan;
(q) Seller's Origination. The Seller's decision to originate any
mortgage loan or to deny any mortgage loan application is an independent
decision based upon Seller's underwriting guidelines, and is in no way made as a
result of Purchaser's decision to purchase, or not to purchase, or the price
Purchaser may offer to pay for, any such mortgage loan, if originated;
(r) Compliance with Anti-Money Laundering Laws. The Seller has
complied with all applicable anti-money laundering laws and regulations,
including without limitation the USA Patriot Act of 2001 (collectively, the
"Anti-Money Laundering Laws"); the Seller has established an anti-money
laundering compliance program as required by the Anti-Money Laundering Laws, has
conducted the requisite due diligence in connection with the origination of each
Mortgage Loan for purposes of the Anti-Money Laundering Laws, including with
respect to the legitimacy of the applicable Mortgagor and the origin of the
assets used by the said Mortgagor to purchase the property in question, and
maintains, and will maintain, sufficient information to identify the applicable
Mortgagor for purposes of the Anti-Money Laundering Laws;
(s) Reports. On or prior to the related Closing Date, Seller has
provided the Custodian and the Purchaser with a MERS Report listing the
Purchaser as the Investor with respect to each MERS Designated Mortgage Loan;
(t) MERS Designations. With respect to each MERS Designated Mortgage
Loan, Seller shall designate the Purchaser as the Investor and no Person shall
be listed as Interim Funder on the MERS(R) System; and
(u) Credit Reporting. The Seller, for so long as it is the Interim
Servicer for each Mortgage Loan, will fully furnish, in accordance with the Fair
Credit Reporting Act and its implementing regulations, accurate and complete
information (e.g., favorable and unfavorable)
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on its borrower credit files to Equifax, Experian and Trans Union Credit
Information Company (three of the credit repositories), on a monthly basis.
Subsection 9.02 Representations and Warranties Regarding Individual
Mortgage Loans.
The Seller hereby represents and warrants to the Purchaser that, as to
each Mortgage Loan, as of the related Closing Date for such Mortgage Loan:
(a) Mortgage Loans as Described. The information set forth in the
Mortgage Loan Schedule is complete, true and correct;
(b) Payments Current. All payments required to be made up to the
Closing Date under the terms of the Mortgage Note have been made and credited.
As of the Closing Date, no payment required under the Mortgage Loan is 30 days
or more delinquent nor has any payment under the Mortgage Loan been 30 days or
more delinquent at any time since the origination of the Mortgage Loan. The
first Monthly Payment due in the calendar month succeeding the calendar month in
which the Closing Date occurs shall be made with respect to the Mortgage Loan on
its Due Date or within the grace period, all in accordance with the terms of the
related Mortgage Note;
(c) No Outstanding Charges. There are no defaults in complying with
the terms of the Mortgage securing the Mortgage Loan, and all taxes,
governmental assessments, insurance premiums, water, sewer and municipal
charges, leasehold payments or ground rents which previously became due and
owing have been paid, or an escrow of funds has been established in an amount
sufficient to pay for every such item which remains unpaid and which has been
assessed but is not yet due and payable. Except for (A) payments in the nature
of escrow payments and (B) interest accruing from the date of the Mortgage Note
or date of disbursement of the Mortgage Loan proceeds, whichever is earlier to
the day which precedes by one month the Due Date of the first installment of
principal and interest, including, without limitation, taxes and insurance
payments, the Seller has not advanced funds, or induced, solicited or knowingly
received any advance of funds by a party other than the Mortgagor, directly or
indirectly, for the payment of any amount required under the Mortgage Loan;
(d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any respect,
from the date of origination 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 Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. 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, and which assumption agreement is part of the Mortgage Loan File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the Mortgage Loan
Schedule;
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(e) 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, and no Mortgagor
was a debtor in any state or federal bankruptcy or insolvency proceeding at, or
subsequent to, the time the Mortgage Loan was originated;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are provided for in the Xxxxxx Xxx Guides or by
Xxxxxxx Mac, as well as all additional requirements set forth in Section 2.10 of
the Interim Servicing Agreement attached hereto as Exhibit B. If required by the
National Flood Insurance Act of 1968, as amended, each Mortgage Loan is covered
by a flood insurance policy meeting the requirements of the current guidelines
of the Federal Insurance Administration in effect, which policy conforms to
Xxxxxx Xxx and Xxxxxxx Mac, as well as all additional requirements set forth in
Section 2.10 of the Interim Servicing Agreement attached hereto as Exhibit B.
All individual insurance policies contain a standard mortgagee clause naming the
Seller and its successors and assigns as mortgagee, and all premiums thereon
have been paid and such policies may not be reduced, terminated or cancelled
without 30 days' prior written notice to the mortgagee. The Mortgage obligates
the Mortgagor thereunder to maintain the hazard insurance policy at the
Mortgagor's cost and expense, and on the Mortgagor's failure to do so,
authorizes the holder of the Mortgage to obtain and maintain such insurance at
such Mortgagor's cost and expense, and to seek reimbursement therefor from the
Mortgagor. Where required by state law or regulation, the Mortgagor has been
given an opportunity to choose the carrier of the required hazard insurance,
provided the policy is not a "master" or "blanket" hazard insurance policy
covering a condominium, or any hazard insurance policy covering the common
facilities of a planned unit development. The hazard insurance policy is the
valid and binding obligation of the insurer, is in full force and effect, and
will be in full force and effect and inure to the benefit of the Purchaser upon
the consummation of the transactions contemplated by this Agreement. The Seller
has not engaged in, and has no knowledge of the Mortgagor's or any servicer's
having engaged in, any act or omission which would impair the coverage of any
such policy, the benefits of the endorsement provided for herein, or the
validity and binding effect of such policy, including, without limitation, no
unlawful fee, commission, kickback or other unlawful compensation or value of
any kind has been or will be received, retained or realized by any attorney,
firm or other person or entity, and no such unlawful items have been received,
retained or realized by the Seller;
(g) 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,
predatory and abusive lending, equal credit opportunity and disclosure laws
applicable to the Mortgage Loan, including, without limitation, any provisions
relating to prepayment penalties, have been complied with, and the consummation
of the transactions contemplated hereby will not involve the violation of any
such laws or regulations, and the Seller shall maintain in its possession,
available for the Purchaser's
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inspection, and shall deliver to the Purchaser upon demand, evidence of
compliance with all such requirements. This representation is a Deemed Material
Breach Representation;
(h) 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 release,
cancellation, subordination or rescission. The Seller has not waived the
performance by the Mortgagor of any action, if the Mortgagor's failure to
perform such action would cause the Mortgage Loan to be in default, nor has the
Seller waived any default resulting from any action or inaction by the
Mortgagor;
(i) Location and Type of Mortgaged Property. The Mortgaged Property is
a fee simple property located in the state identified in the Mortgage Loan
Schedule except that with respect to real property located in jurisdictions in
which the use of leasehold estates for residential properties is a
widely-accepted practice, the Mortgaged Property may be a leasehold estate and
consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a low-rise condominium project, or an individual
unit in a planned unit development and that no residence or dwelling is (i) a
mobile home or (ii) a manufactured home; provided, however, that any condominium
unit or planned unit development shall not fall within any of the "Ineligible
Projects" of part XII, Section 102 of the Xxxxxx Mae Selling Guide and shall
conform with the Underwriting Guidelines. In the case of any Mortgaged
Properties that are manufactured homes (a "Manufactured Home Mortgage Loans"),
(i) such Manufactured Home Mortgage Loan conforms with the applicable Xxxxxx Xxx
or Xxxxxxx Mac requirements regarding mortgage loans related to manufactured
dwellings, (ii) the related manufactured dwelling is permanently affixed to the
land, (iii) the related manufactured dwelling and the related land are subject
to a Mortgage properly filed in the appropriate public recording office and
naming Seller as mortgagee, (iv) the applicable laws of the jurisdiction in
which the related Mortgaged Property is located will deem the manufactured
dwelling located on such Mortgaged Property to be a part of the real property on
which such dwelling is located, (v) as of the origination date of the related
Mortgage Loan, the related Mortgagor occupied the related manufactured home as
its primary residence, and (vi) such Manufactured Home Mortgage Loan is (x) a
qualified mortgage under Section 860G(a)(3) of the Internal Revenue Code of
1986, as amended and (y) secured by manufactured housing treated as a single
family residence under Section 25(e)(10) of the Code. As of the date of
origination, no portion of the Mortgaged Property was used for commercial
purposes, and since the date of origination, no portion of the Mortgaged
Property has been used for commercial purposes; provided, that Mortgaged
Properties which contain a home office shall not be considered as being used for
commercial purposes as long as the Mortgaged Property has not been altered for
commercial purposes and is not storing any chemicals or raw materials other than
those commonly used for homeowner repair, maintenance and/or household purposes.
This representation is a Deemed Material Breach Representation;
(j) Valid First and Second Lien. Each Mortgage is a valid and
subsisting first lien, with respect to First Lien Loans, or second lien, with
respect to Second Lien Loans, of record on a single parcel of real estate
constituting the Mortgaged Property, including all buildings and improvements on
the Mortgaged Property and all installations and mechanical,
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electrical, plumbing, heating and air conditioning systems located in or annexed
to such buildings, and all additions, alterations and replacements made at any
time, subject in all cases to the exceptions to title set forth in the title
insurance policy with respect to the related Mortgage Loan, which exceptions are
generally acceptable to prudent mortgage lending companies, and such other
exceptions to which similar properties are commonly subject and which do not
individually, or in the aggregate, materially and adversely affect the benefits
of the security intended to be provided by such Mortgage. In no event shall any
Mortgage Loan be in a lien position more junior than a second lien. The lien of
the Mortgage is subject only to:
(1) with respect to Second Lien Loans, the lien of the first
mortgage on the Mortgaged Property;
(2) the lien of current real property taxes and assessments
not yet due and payable;
(3) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date
of recording acceptable to prudent mortgage lending institutions
generally and specifically referred to in the lender's title
insurance policy delivered to the originator of the Mortgage Loan
and (a) specifically referred to or otherwise considered in the
appraisal made for the originator of the Mortgage Loan or (b)
which do not adversely affect the Appraised Value of the
Mortgaged Property set forth in such appraisal; and
(4) 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, enforceable and perfected (A) first lien and first priority security
interest with respect to each First Lien Loan, or (B) second lien and second
priority security interest with respect to each Second Lien Loan, in either
case, on the property described therein and Seller has full right to sell and
assign the same to Purchaser. The Mortgaged Property was not, as of the date of
origination of the Mortgage Loan, subject to a mortgage, deed of trust, deed to
secure debt or other security instrument creating a lien subordinate to the lien
of the Mortgage;
(k) Validity of Mortgage Documents. The Mortgage Note and the Mortgage
and any other agreement executed and delivered by a Mortgagor or guarantor, if
applicable, in connection with a Mortgage Loan are genuine, and each is the
legal, valid and binding obligation of the maker thereof enforceable in
accordance with its terms (including, without limitation, any provisions therein
relating to prepayment penalties). All parties to the Mortgage Note, the
Mortgage and any other such related agreement had legal capacity to enter into
the Mortgage Loan and to execute and deliver the Mortgage Note, the Mortgage and
any other related agreement, and the Mortgage Note, the Mortgage and any other
such related agreement have been duly and properly executed by other such
related parties. The documents, instruments and
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agreements submitted for loan underwriting were not falsified and contain no
untrue statement of material fact or omit to state a material fact required to
be stated therein or necessary to make the information and statements therein
not misleading. No fraud, error, omission, misrepresentation, negligence or
similar occurrence with respect to a Mortgage Loan has taken place on the part
of any Person, including without limitation, the Mortgagor, any appraiser, any
builder or developer, or any other party involved in the origination or
servicing of the Mortgage Loan. The Seller has reviewed all of the documents
constituting the Servicing File and has made such inquiries as it deems
necessary to make and confirm the accuracy of the representations set forth
herein;
(l) Full Disbursement of Proceeds. The Mortgage Loan has been closed
and the proceeds of the Mortgage Loan have been fully disbursed and there is no
requirement for future advances thereunder, and any and all requirements as to
completion of any on-site or off-site improvement and as to disbursements of any
escrow funds therefor have been complied with. 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;
(m) Ownership. The Seller is the sole owner of record and holder of
the Mortgage Loan and the indebtedness evidenced by each Mortgage Note and upon
the sale of the Mortgage Loans to the Purchaser, the Seller will retain the
Mortgage Files or any part thereof with respect thereto not delivered to the
Custodian, the Purchaser or the Purchaser's designee, in trust only for the
purpose of servicing and supervising the servicing of each Mortgage Loan. The
Mortgage Loan is not assigned or pledged, and the Seller has good, indefeasible
and marketable title thereto, and has full right to transfer and sell the
Mortgage Loan to the Purchaser free and clear of any encumbrance, equity,
participation interest, lien, pledge, charge, claim or security interest, and
has full right and authority subject to no interest or participation of, or
agreement with, any other party, to sell and assign each Mortgage Loan pursuant
to this Agreement and following the sale of each Mortgage Loan, the Purchaser
will own such Mortgage Loan free and clear of any encumbrance, equity,
participation interest, lien, pledge, charge, claim or security interest. The
Seller intends to relinquish all rights to possess, control and monitor the
Mortgage Loan. After the Closing Date, the Seller will have no right to modify
or alter the terms of the sale of the Mortgage Loan and the Seller will have no
obligation or right to repurchase the Mortgage Loan or substitute another
Mortgage Loan, except as provided in this Agreement;
(n) Doing Business. 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 (2) either (i) organized
under the laws of such state, or (ii) qualified to do business in such state, or
(iii) a federal savings and loan association, a savings bank or a national bank
having a principal office in such state, or (3) not doing business in such
state;
(o) CLTV, LTV; FICO Score. No Mortgage Loan that is a Second Lien Loan
has a CLTV in excess of 100%. No Mortgage Loan has an LTV greater than 100%. At
origination of the Mortgage Loan, the Mortgagor did not have a FICO score of
less than 500;
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(p) Title Insurance. The Mortgage Loan is covered by an ALTA lender's
title insurance policy or other generally acceptable form of policy or insurance
acceptable to Xxxxxx Xxx or Xxxxxxx Mac and each such title insurance policy is
issued by a title insurer acceptable to Xxxxxx Mae or Xxxxxxx Mac and qualified
to do business in the jurisdiction where the Mortgaged Property is located,
insuring the Seller, its successors and assigns, as to the first priority lien
(with respect to First Lien Loans) or second priority lien (with respect to
Second Lien Loans) of the Mortgage in the original principal amount of the
Mortgage Loan, subject only to the exceptions contained in clauses (1) and (2)
of paragraph (j) of this Subsection 9.02, and in the case of Adjustable Rate
Mortgage Loans, against any loss by reason of the invalidity or unenforceability
of the lien resulting from the provisions of the Mortgage providing for
adjustment to the Mortgage Interest Rate and Monthly Payment. Where required by
state law or regulation, the Mortgagor has been given the opportunity to choose
the carrier of the required mortgage title insurance. Additionally, such
lender's title insurance policy affirmatively insures ingress and egress, and
against encroachments by or upon the Mortgaged Property or any interest therein.
The title policy does not contain any special exceptions (other than the
standard exclusions) for zoning and uses and has been marked to delete the
standard survey exception or to replace the standard survey exception with a
specific survey reading. The Seller, its successor and assigns, are the sole
insureds of such lender's title insurance policy, and such lender's title
insurance policy is valid and remains 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 related Mortgage, including the Seller, has done, by
act or omission, anything which would impair the coverage of such lender's title
insurance policy, including without limitation, no unlawful fee, commission,
kickback or other unlawful compensation or value of any kind has been or will be
received, retained or realized by any attorney, firm or other person or entity,
and no such unlawful items have been received, retained or realized by the
Seller;
(q) No Defaults. There is no default, breach, violation or event which
would permit acceleration existing under the Mortgage or the Mortgage Note and
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
which would permit acceleration, and neither the Seller nor any of its
affiliates nor any of their respective predecessors, have waived any default,
breach, violation or event which would permit acceleration. With respect to each
Second Lien Loan, (i) the prior mortgage is in full force and effect, (ii) there
is no default, breach, violation or event of acceleration existing under such
prior mortgage or the related mortgage note, (iii) 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 of acceleration
thereunder, and either (A) the prior mortgage contains a provision which allows
or (B) applicable law requires, the mortgagee under the Second Lien Loan to
receive notice of, and affords such mortgagee an opportunity to cure any default
by payment in full or otherwise under the prior mortgage;
(r) 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;
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(s) Location of Improvements; No Encroachments. 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. The Mortgaged Property and all improvements located on or
being part of the Mortgaged Property are in compliance with all applicable
zoning and building laws, ordinances and regulations;
(t) Origination; Payment Terms. The Mortgage Loan was originated by a
mortgagee approved by the Secretary of Housing and Urban Development pursuant to
Sections 203 and 211 of the Act, a savings and loan association, a savings bank,
a commercial bank, credit union, insurance company or other similar institution
which is supervised and examined by a federal or state authority. The documents,
instruments and agreements submitted for loan underwriting were not falsified
and contain no untrue statement of material fact or omit to state a material
fact required to be stated therein or necessary to make the information and
statements therein not misleading. No Mortgage Loan contains terms or provisions
which would result in negative amortization. Principal payments on the Mortgage
Loan commenced no more than sixty days after funds were disbursed in connection
with the Mortgage Loan. The Mortgage Interest Rate as well as, with respect to
Adjustable Rate Mortgage Loans, the Lifetime Rate Cap, the Periodic Rate Floor
and the Periodic Rate Cap are as set forth on Exhibit B to each related
Assignment and Conveyance Agreement. The Mortgage Interest Rate is adjusted,
with respect to Adjustable Rate Mortgage Loans, on each Interest Rate Adjustment
Date to equal the Index plus the Gross Margin (rounded up or down to the nearest
0.125%), subject to the Periodic Rate Cap. The Mortgage Note is payable in equal
monthly installments of principal and interest, which installments of interest,
with respect to Adjustable Rate Mortgage Loans, are subject to change due to the
adjustments to the Mortgage Interest Rate on each Interest Rate Adjustment Date,
with interest calculated and payable in arrears, sufficient to amortize the
Mortgage Loan fully by the stated maturity date, over an original term of not
more than thirty years from commencement of amortization. Unless otherwise
specified on the description of pool characteristics for the applicable Mortgage
Loan Package delivered pursuant to Section 11 on the related Closing Date in the
form attached as Exhibit B to each related Assignment and Conveyance Agreement,
the Mortgage Loan is payable on the first day of each month. There are no
Convertible Mortgage Loans which contain a provision allowing the Mortgagor to
convert the Mortgage Note from an adjustable interest rate Mortgage Note to a
fixed interest rate Mortgage Note. The Due Date of the first payment under the
Mortgage Note is no more than 60 days from the date of the Mortgage Note;
(u) 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. Upon default by a Mortgagor on a Mortgage Loan and
foreclosure on, or trustee's sale of, the Mortgaged Property pursuant to the
proper procedures, the holder of the Mortgage Loan will be able to deliver good
and merchantable title to the Mortgaged Property. 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, subject to applicable federal and state laws and judicial precedent
with respect to bankruptcy and right of redemption or similar law;
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(v) Conformance with Agency and Underwriting Guidelines. The Mortgage
Loan was underwritten in accordance with the Underwriting Guidelines (a copy of
which is attached to the related Assignment and Conveyance Agreement as Exhibit
C). The Mortgage Note and Mortgage are on forms acceptable to Xxxxxxx Mac or
Xxxxxx Mae and neither the Seller nor the Interim Servicer has made any
representations to a Mortgagor that are inconsistent with the mortgage
instruments used;
(w) Occupancy of the Mortgaged Property. As of the Closing Date the
Mortgaged Property is lawfully occupied under applicable law. 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. The Seller has not received notification from any
Governmental Authority that the Mortgaged Property is in material non-compliance
with such laws or regulations, is being used, operated or occupied unlawfully or
has failed to have or obtain such inspection, licenses or certificates, as the
case may be. The Seller has not received notice of any violation or failure to
conform with any such law, ordinance, regulation, standard, license or
certificate. Unless otherwise noted on the Mortgage Loan Schedule, the Mortgagor
represented at the time of origination of the Mortgage Loan that the Mortgagor
would occupy the Mortgaged Property as the Mortgagor's primary residence;
(x) No Additional Collateral. The Mortgage Note is not and has not
been secured by any collateral except the lien of the corresponding Mortgage and
the security interest of any applicable security agreement or chattel mortgage
referred to in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and duly qualified under applicable law to serve as
such, has been properly designated and currently so serves and is named in the
Mortgage (or in the case of a substitution of trustee, is named in a properly
recorded substitution of trustee), and no fees or expenses are or will become
payable by the Purchaser, the Custodian or the Interim Servicer to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor;
(z) Acceptable Investment. There are no circumstances or conditions
with respect to the Mortgage, the Mortgaged Property, the Mortgagor, the
Mortgage File or the Mortgagor's credit standing that can reasonably be expected
to cause private institutional investors to regard the Mortgage Loan as an
unacceptable investment, cause the Mortgage Loan to become delinquent, or
adversely affect the value or marketability of the Mortgage Loan, or cause the
Mortgage Loan to prepay during any period materially faster or slower than the
mortgage loans originated by the Seller generally;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the Mortgage,
the Assignment of Mortgage and any other documents required to be delivered
under this Agreement for each Mortgage Loan have been delivered to the
Custodian. The Seller is in possession of a complete, true and accurate Mortgage
File in compliance with Exhibit A hereto, except for such documents the
originals of which have been delivered to the Custodian, and the Seller has
retained copies thereof;
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(bb) Condominiums/Planned Unit Developments. 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
is (i) acceptable to Xxxxxx Xxx or Xxxxxxx Mac or (ii) located in a condominium
or planned unit development project which has received project approval from
Xxxxxx Mae or Xxxxxxx Mac. The representations and warranties required by Xxxxxx
Mae with respect to such condominium or planned unit development have been
satisfied and remain true and correct;
(cc) Transfer of Mortgage Loans. Except with respect to MERS
Designated Mortgage Loans, the Assignment of Mortgage with respect to each
Mortgage Loan is in recordable form and is acceptable for recording under the
laws of the jurisdiction in which the Mortgaged Property is located. The
transfer, assignment and conveyance of the Mortgage Notes and the Mortgages by
the Seller are not subject to the bulk transfer or similar statutory provisions
in effect in any applicable jurisdiction;
(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision for the acceleration of the payment
of the unpaid principal balance of the Mortgage Loan in the event that the
Mortgaged Property is sold or transferred without the prior written consent of
the mortgagee thereunder, and to the best of the Seller's knowledge, such
provision is enforceable;
(ee) No Balloon Mortgage Loans. The Mortgage Loan is not a Balloon
Mortgage Loan unless specifically listed on the Mortgage Loan Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to which
Monthly Payments are paid or partially paid with funds deposited in any separate
account established by the Seller, the Mortgagor, or anyone on behalf of the
Mortgagor, or paid by any source other than the Mortgagor nor does it contain
any other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan, and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature. The
indebtedness evidenced by the Mortgage Note is not convertible to an ownership
interest in the Mortgaged Property or the Mortgagor and the Seller has not
financed nor does it own directly or indirectly, any equity of any form in the
Mortgaged Property or the Mortgagor;
(gg) Consolidation of Future Advances. Any future advances made to the
Mortgagor prior to the Cut-off Date have been consolidated with the outstanding
principal amount secured by the Mortgage, and the secured principal amount, as
consolidated, bears a single interest rate and single repayment term. The lien
of the Mortgage securing the consolidated principal amount is expressly insured
as having first or second, as applicable, lien priority by a title insurance
policy, an endorsement to the policy insuring the mortgagee's consolidated
interest or by other title evidence acceptable to Xxxxxx Xxx and Xxxxxxx Mac.
The consolidated principal amount does not exceed the original principal amount
of the Mortgage Loan;
(hh) Mortgaged Property Undamaged; No Condemnation Proceedings. There
is no proceeding pending or threatened for the total or partial condemnation of
the Mortgaged
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Property. The Mortgaged Property is undamaged by waste, 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 and each Mortgaged Property is
in good repair. There have not been any condemnation proceedings with respect to
the Mortgaged Property and the Seller has no knowledge of any such proceedings
in the future;
(ii) Collection Practices; Escrow Deposits; Interest Rate Adjustments.
The origination, servicing and collection practices with respect to the Mortgage
Loan have been in all respects in compliance with Accepted Servicing Practices,
applicable laws and regulations, and have been in all respects legal and proper.
With respect to escrow deposits and Escrow Payments (other than with respect to
Second Lien Loans for which the mortgagee under the prior mortgage lien is
collecting Escrow Payments), all such payments are in the possession of Seller
and there exist no deficiencies in connection therewith for which customary
arrangements for repayment thereof have not been made. Each Mortgage Loan is
covered by a paid in full, life of loan, tax service contract that has been
assigned without penalty, premium or cost to the Purchaser. All Escrow Payments
have been collected in full compliance with state and federal law and the
provisions of the related Mortgage Note and Mortgage. An escrow of funds is not
prohibited by applicable law and has been established in an amount sufficient 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 Seller have been capitalized under the Mortgage or the Mortgage Note.
All Mortgage Interest Rate adjustments have been made in strict compliance with
state and federal law and the terms of the related Mortgage and Mortgage Note on
the related Interest Rate Adjustment Date. If, pursuant to the terms of the
Mortgage Note, another index was selected for determining the Mortgage Interest
Rate, the same index was used with respect to each Mortgage Note which required
a new index to be selected, and such selection did not conflict with the terms
of the related Mortgage Note. Any and all notices required under applicable law
and the terms of the related Mortgage Note and Mortgage regarding the Mortgage
Interest Rate and the Monthly Payment adjustments have been delivered. Any
interest required to be paid pursuant to state, federal and local law has been
properly paid and credited;
(jj) Mortgage Loan Attributes: The Mortgage Loan has the
characteristics set forth on Exhibit B to the related Assignment and Conveyance
Agreement;
(kk) Other Insurance Policies; No Defense to Coverage. No action,
inaction or event has occurred and no state of facts exists or has existed on or
prior to the Closing Date that has resulted or will result in the exclusion
from, denial of, or defense to coverage under any applicable primary mortgage
insurance policy, hazard insurance policy or bankruptcy bond (including, without
limitation, any exclusions, denials or defenses which would limit or reduce the
availability of the timely payment of the full amount of the loss otherwise due
thereunder to the insured), irrespective of the cause of such failure of
coverage. The Seller has caused or will cause to be performed any and all acts
required to preserve the rights and remedies of the Purchaser in any insurance
policies applicable to the Mortgage Loans including, without limitation, any
necessary notifications of insurers, assignments of policies or interests
therein, and establishments of coinsured, joint loss payee and mortgagee rights
in favor of the Purchaser. In connection with the placement of any such
insurance, no commission, fee, or other
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compensation has been or will be received by the Seller or by any officer,
director, or employee of the Seller or any designee of the Seller or any
corporation in which the Seller or any officer, director, or employee had a
financial interest at the time of placement of such insurance;
(ll) No Violation of Environmental Laws. The Mortgaged Property is
free from any and all toxic or hazardous substances and there exists no
violation of any local, state or federal environmental law, rule or regulation.
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; 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;
(mm) Servicemembers' Civil Relief Act. The Mortgagor has not notified
the Seller, and the Seller has no knowledge of any relief requested or allowed
to the Mortgagor under the Servicemembers' Civil Relief Act of 1940, as amended,
or any similar state statute;
(nn) Appraisal. The Seller has delivered to the Purchaser an appraisal
of the Mortgaged Property signed prior to the approval of the Mortgage
application by an appraiser qualified under Xxxxxx Xxx and Xxxxxxx Mac
guidelines who (i) is licensed in the state where the Mortgaged Property is
located, (ii) has no interest, direct or indirect, in the Mortgaged Property or
in any Loan or the security therefor, and (iii) does not receive compensation
that is affected by the approval or disapproval of the Mortgage Loan. The
appraisal shall have been made within one hundred and eighty (180) days of the
origination of the Mortgage Loan and shall be completed in compliance with the
Uniform Standards of Professional Appraisal Practice, and all applicable Federal
and state laws and regulations. If the appraisal was made more than one hundred
and twenty (120) days before the origination of the Mortgage Loan, the Seller
shall have received and delivered to the Purchaser a recertification of the
appraisal;
(oo) Disclosure Materials. The Mortgagor has, and has executed a
statement to the effect that the Mortgagor has, received all disclosure
materials required by applicable law and the Seller has complied with all
applicable law with respect to the making of the Mortgage Loans. The Seller
shall cause the Interim Servicer to maintain such statement in the Mortgage
File;
(pp) Construction or Rehabilitation of Mortgaged Property. The
Mortgage Loan was not made in connection with the construction or rehabilitation
of a Mortgaged Property or facilitating the trade-in or exchange of a Mortgaged
Property;
(qq) No Defense to Insurance Coverage. No action has been taken or
failed to be taken, no event has occurred and no state of facts exists or has
existed on or prior to the Closing Date (whether or not known to the Seller on
or prior to such date) which has resulted or will result in an exclusion from,
denial of, or defense to coverage under any primary mortgage insurance
(including, without limitation, any exclusions, denials or defenses which would
limit or reduce the availability of the timely payment of the full amount of the
loss otherwise due thereunder to the insured) whether arising out of actions,
representations, errors, omissions, negligence, or fraud of the Seller, the
related Mortgagor or any party involved in the application for such coverage,
including the appraisal, plans and specifications and other exhibits or
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documents submitted therewith to the insurer under such insurance policy, or for
any other reason under such coverage, but not including the failure of such
insurer to pay by reason of such insurer's breach of such insurance policy or
such insurer's financial inability to pay. In connection with the placement of
any such insurance, no commission, fee, or other compensation has been or will
be received by the Seller or any designee of the Seller or any corporation in
which the Seller or any officer, director, or employee had a financial interest
at the time of placement of such insurance;
(rr) Qualified Mortgage. The Mortgage Loan is a qualified mortgage
under Section 860G(a)(3) of the Code;
(ss) Credit Information. As to each consumer report (as defined in the
Fair Credit Reporting Act, Public Law 91-508) or other credit information
furnished by the Seller to the Purchaser, that Seller has full right and
authority and is not precluded by law or contract from furnishing such
information to the Purchaser and the Purchaser is not precluded by the terms of
the Mortgage Loan Documents from furnishing the same to any subsequent or
prospective purchaser of such Mortgage. The Seller shall hold the Purchaser
harmless from any and all damages, losses, costs and expenses (including
attorney's fees) arising from disclosure of credit information in connection
with the Purchaser's secondary marketing operations and the purchase and sale of
mortgages. The Seller has in its capacity as servicer, for each Mortgage Loan,
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. This representation is a Deemed Material Breach Representation;
(tt) Leaseholds. If the Mortgage Loan is secured by a long-term
residential lease, (1) the lessor under the lease holds a fee simple interest in
the land; (2) the terms of such lease expressly permit the mortgaging of the
leasehold estate, the assignment of the lease without the lessor's consent and
the acquisition by the holder of the Mortgage of the rights of the lessee upon
foreclosure or assignment in lieu of foreclosure or provide the holder of the
Mortgage with substantially similar protections; (3) the terms of such lease do
not (a) allow the termination thereof upon the lessee's default without the
holder of the Mortgage being entitled to receive written notice of, and
opportunity to cure, such default, (b) allow the termination of the lease in the
event of damage or destruction as long as the Mortgage is in existence, (c)
prohibit the holder of the Mortgage from being insured (or receiving proceeds of
insurance) under the hazard insurance policy or policies relating to the
Mortgaged Property or (d) permit any increase in rent other than pre-established
increases set forth in the lease; (4) the original term of such lease is not
less than 15 years; (5) the term of such lease does not terminate earlier than
five years after the maturity date of the Mortgage Note; and (6) the Mortgaged
Property is located in a jurisdiction in which the use of leasehold estates in
transferring ownership in residential properties is a widely accepted practice;
(uu) Prepayment Penalty. The Mortgage Loan is subject to a prepayment
penalty as provided in the related Mortgage Note except as set forth on Exhibit
B to each related Assignment and Conveyance Agreement. With respect to each
Mortgage Loan that has a prepayment penalty feature, each such prepayment
penalty is enforceable and will be enforced
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by the Seller for the benefit of the Purchaser, and each prepayment penalty is
permitted pursuant to federal, state and local law. Each such prepayment penalty
is in an amount equal to the maximum amount permitted under applicable law and
no such prepayment penalty may be imposed for a term in excess of five (5) years
with respect to Mortgage Loans originated prior to October, 1, 2002. With
respect to Mortgage Loans originated on or after October 1, 2002, the duration
of the prepayment period shall not exceed three (3) years from the date of the
Mortgage Note unless the Mortgage Loan was modified to reduce the prepayment
period to no more than three (3) years from the date of such Mortgage Note and
the Mortgagor was notified in writing of such reduction in prepayment period.
With respect to any Mortgage Loan that contains a provision permitting
imposition of a premium upon a prepayment prior to maturity: (i) prior to the
Mortgage Loan's origination, the Mortgagor agreed to such premium in exchange
for a monetary benefit, including but not limited to a rate or fee reduction,
and (ii) prior to the Mortgage Loan's origination, the Mortgagor was offered the
option of obtaining a mortgage loan that did not require payment of such a
premium, (iii) the prepayment premium is disclosed to the Mortgagor in the loan
documents pursuant to applicable state, local and federal law. This
representation is a Deemed Material Breach Representation;
(vv) Assumability. With respect to each Adjustable Rate Mortgage Loan,
the Mortgage Loan Documents provide that after the related first Interest Rate
Adjustment Date, a related Mortgage Loan may only be assumed if the party
assuming such Mortgage Loan meets certain credit requirements stated in the
Mortgage Loan Documents;
(ww) Conversion to Fixed Interest Rate. With respect to Adjustable
Rate Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;
(xx) [Reserved];
(yy) Predatory Lending Regulations. No Mortgage Loan is a High Cost
Loan or Covered Loan, as applicable, and no Mortgage Loan originated on or after
October 1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending
Act. No Mortgage Loan is covered by the Home Ownership and Equity Protection Act
of 1994 and no Mortgage Loan is in violation of any comparable state or local
law. The Mortgaged Property is not located in a jurisdiction where a breach of
this representation with respect to the related Mortgage Loan may result in
additional assignee liability to the Purchaser, as determined by Purchaser in
its reasonable discretion. This representation is a Deemed Material Breach
Representation;
(zz) Single-premium credit life insurance policy. No Mortgagor was
required to purchase any single premium credit insurance policy (e.g., life,
mortgage, disability, property, accident, unemployment or health insurance
product) or debt cancellation agreement as a condition of obtaining the
extension of credit. No Mortgagor obtained a prepaid single premium credit
insurance policy (e.g., life, mortgage, disability, property, accident,
unemployment, mortgage or health insurance) in connection with the origination
of the Mortgage Loan. No proceeds from any Mortgage Loan were used to purchase
single premium credit insurance policies or debt cancellation agreements as part
of the origination of, or as a condition to closing, such Mortgage Loan. This
representation is a Deemed Material Breach Representation;
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(aaa) Regarding the Mortgagor. The Mortgagor is one or more natural
persons and/or trustees for an Illinois land trust or a trustee under a "living
trust" and such "living trust" is in compliance with Xxxxxx Xxx guidelines for
such trusts;
(bbb) Insurance. The Seller has caused or will cause to be performed
any and all acts required to preserve the rights and remedies of the Purchaser
in any insurance policies applicable to the Mortgage Loans including, without
limitation, any necessary notifications of insurers, assignments of policies or
interests therein, and establishments of coinsured, joint loss payee and
mortgagee rights in favor of the Purchaser;
(ccc) Simple Interest Mortgage Loans. The Mortgage Loan is not a
simple interest Mortgage Loan;
(ddd) Flood Certification Contract. The Mortgage Loan is covered by a
paid in full, life of loan, transferable flood certification contract that has
been assigned without penalty, cost or premium to the Purchaser;
(eee) Consent. Either (a) no consent for the Second Lien Loan is
required by the holder of the related first lien or (b) such consent has been
obtained and is contained in the Mortgage File;
(fff) Origination Date. The date of origination of the Mortgage Loan
shall be no earlier than three (3) months prior to the date such Mortgage Loan
is first purchased by the Purchaser;
(ggg) No Exception. The Custodian has not noted any material
exceptions on an Exception Report (as defined in the Custodial Agreement) with
respect to the Mortgage Loan which would materially adversely affect the
Mortgage Loan or the Purchaser's ownership of the Mortgage Loan, unless
consented to by the Purchaser;
(hhh) Mortgage Submitted for Recordation. The Mortgage either has been
or will promptly be submitted for recordation in the appropriate governmental
recording office of the jurisdiction where the Mortgaged Property is located;
(iii) Endorsements. The Mortgage Note has been endorsed by Seller for
its own account and not as a fiduciary, trustee, trustor or beneficiary under a
trust agreement;
(jjj) Accuracy of Information. All information provided to the
Purchaser by the Seller with respect to the Mortgage Loan is accurate in all
material respects;
(kkk) Mortgagor Bankruptcy. On or prior to the date 60 days after the
related Closing Date, the Mortgagor has not filed or will not file a bankruptcy
petition or has not become the subject or will not become the subject of
involuntary bankruptcy proceedings or has not consented to or will not consent
to the filing of a bankruptcy proceeding against it or to a receiver being
appointed in respect of the related Mortgaged Property;
(lll) No Construction Loans. No Mortgage Loan was made in connection
with (a) facilitating the trade-in or exchange of a Mortgaged Property or (b)
the construction or
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rehabilitation of a Mortgaged Property, unless the Mortgage
Loan is a construction-to-permanent mortgage loan listed on the Mortgage Loan
Schedule which has been fully disbursed, all construction work is complete and a
completion certificate has been issued;
(mmm) No Equity Participation. No document relating to the Mortgage
Loan provides for any contingent or additional interest in the form of
participation in the cash flow of the Mortgaged Property or a sharing in the
appreciation of the value of the Mortgaged Property. The indebtedness evidenced
by the Mortgage Note is not convertible to an ownership interest in the
Mortgaged Property or the Mortgagor and Seller has not financed nor does it own
directly or indirectly, any equity of any form in the Mortgaged Property or the
Mortgagor;
(nnn) Proceeds of Mortgage Loan. The proceeds of the Mortgage Loan
have not been and shall not be used to satisfy, in whole or in part, any debt
owed or owing by the Mortgagor to Seller or any Affiliate or correspondent
thereof unless such debt was originated more than 24 months prior to the
origination of such Mortgage Loan;
(ooo) No Arbitration. No Mortgagor with respect to any Mortgage Loan
originated on or after August 1, 2004 agreed to submit to arbitration to resolve
any dispute arising out of or relating in any way to the mortgage loan
transaction. This representation is a Deemed Material Breach Representation;
(ppp) Origination Practices/No Steering. No Mortgagor was encouraged
or required to select a Mortgage Loan product offered by the Mortgage Loan's
originator which is a higher cost product designed for less creditworthy
borrowers, unless at the time of the Mortgage Loan's origination, such Mortgagor
did not qualify taking into account credit history and debt-to-income ratios for
a lower-cost credit product then offered by the Mortgage Loan's originator or
any affiliate of the Mortgage Loan's originator. If, at the time of loan
application, the Mortgagor may have qualified for a lower-cost credit product
then offered by any mortgage lending affiliate of the Mortgage Loan's
originator, the Mortgage Loan's originator referred the Mortgagor's application
to such affiliate for underwriting consideration. This representation is a
Deemed Material Breach Representation;
(qqq) Underwriting Methodology. The methodology used in underwriting
the extension of credit for each Mortgage Loan employs, in part, objective
mathematical principles which relate the Mortgagor's income, assets and
liabilities to the proposed payment and such underwriting methodology does not
rely on the extent of the Mortgagor's equity in the collateral as the principal
determining factor in approving such credit extension. Such underwriting
methodology confirmed that at the time of origination (application/approval) the
Mortgagor had a reasonable ability to make timely payments on the Mortgage Loan.
This representation is a Deemed Material Breach Representation;
(rrr) Points and Fees. No Mortgagor was charged "points and fees"
(whether or not financed) in an amount greater than (i) $1,000 or (ii) 5% of the
principal amount of such Mortgage Loan, whichever is greater. For purposes of
this representation, "points and fees" (x) include origination, underwriting,
broker and finder fees and charges paid to the mortgage or a third party; and
(y) exclude bona fide discount points, fees paid for actual services rendered in
connection with the origination of the Mortgage Loan (such attorneys' fees,
notaries fees and
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fees paid for property appraisals, credit reports, surveys, title examinations
and extracts, flood and tax certifications and home inspections); the costs of
mortgage insurance or credit-risk price adjustments; the costs of title, hazard
and flood insurance policies; state and local transfer taxes or fees; escrow
deposits for the future payment of taxes and insurance premiums; and other
miscellaneous fees and charges that, in total, do not exceed 0.25% of the
principal amount of such Mortgage Loan. This representation is a Deemed Material
Breach Representation;
(sss) Fees Charges. All fees and charges (including finance charges)
and whether or not financed, assessed, collected or to be collected in
connection with the origination and servicing of each Mortgage Loan has been
disclosed in writing to the Mortgagor in accordance with applicable state and
federal law and regulation. This representation is a Deemed Material Breach
Representation; and
(ttt) Second Lien Mortgage Loans. With respect to each Second Lien
Loan: (1) the related First Lien Loan does not permit negative amortization; (2)
where required or customary in the jurisdiction in which the Mortgaged Property
is located, the original lender has filed for record a request for notice of any
action by the related senior lienholder, and the Seller has notified such second
lienholder in writing of the existence of the Second Lien Loan and requested
notification of any action to be taken against the Mortgagor by such senior
lienholder; either (a) no consent for the Second Lien Loan is required by the
holder of the related First Lien Loan or (b) such consent has been obtained and
is contained in the related Mortgage File; (3) to the best of Seller's
knowledge, the related First Lien Loan is in full force and effect, and there is
no default, lien, breach, violation or event which would permit acceleration
existing under such First Lien Loan or Mortgage Note, and 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 which would
permit acceleration under such First Lien Loan; (4) the related first lien
Mortgage contains a provision which provide for giving notice of default or
breach to the mortgagee under the Mortgage Loan and allows such mortgagee to
cure any default under the related first lien Mortgage; and (5) the related
Mortgaged Property was the Mortgagor's principal residence at the time of the
origination of the such Second Lien Loan. This representation is a Deemed
Material Breach Representation.
Subsection 9.03 Remedies for Breach of Representations and Warranties.
It is understood and agreed that the representations and warranties
set forth in Subsections 9.01 and 9.02 shall survive the sale of the Mortgage
Loans to the Purchaser 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 Seller or the Purchaser of a breach of any of
the foregoing representations and warranties, the party discovering such breach
shall give prompt written notice to the other.
Within 60 days of the earlier of either discovery by or notice to the
Seller of any breach of a representation or warranty which materially and
adversely affects the value of the Mortgage Loans or the interest of the
Purchaser therein (or which materially and adversely affects the value of the
applicable Mortgage Loan or the interest of the Purchaser therein in the case of
a representation and warranty relating to a particular Mortgage Loan), the
Seller shall use
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its best efforts promptly to cure such breach in all material respects and, if
such breach cannot be cured, the Seller shall, at the Purchaser's option,
repurchase such Mortgage Loan at the Repurchase Price, together with all
expenses incurred by the Purchaser as a result of such repurchase.
Notwithstanding the above sentence, (i) within 60 days of the earlier of either
discovery by, or notice to, the Seller of any breach of the representation or
warranty set forth in clause (rr) of Subsection 9.02, the Seller shall
repurchase such Mortgage Loan at the Repurchase Price, together with all
expenses incurred by the Purchaser as a result of such repurchase and (ii) any
breach of a Deemed Material Breach Representation shall automatically be deemed
to materially and adversely affect the value of the Mortgage Loans or the
interest of the Purchaser therein. In the event that a breach shall involve any
representation or warranty set forth in Subsection 9.01, and (except as provided
in the preceding sentence with respect to certain breaches for which no cure is
permitted) such breach cannot be cured within 60 days of the earlier of either
discovery by or notice to the Seller of such breach, all of the Mortgage Loans
shall, at the Purchaser's option, be repurchased by the Seller at the Repurchase
Price, together with all expenses incurred by the Purchaser as a result of such
repurchase. However, if the breach shall involve a representation or warranty
set forth in Subsection 9.02 (other than the representation and warranty set
forth in clause (rr) or a Deemed Material Breach Representation of such
Subsection) and the Seller discovers or receives notice of any such breach
within 120 days of the related Closing Date, the Seller shall, at the
Purchaser's option and provided that the Seller has a Qualified Substitute
Mortgage Loan, rather than repurchase the Mortgage Loan as provided above,
remove such Mortgage Loan (a "Deleted Mortgage Loan") and substitute in its
place a Qualified Substitute Mortgage Loan or Loans, provided that any such
substitution shall be effected not later than 120 days after the related Closing
Date. If the Seller has no Qualified Substitute Mortgage Loan, it shall
repurchase the deficient Mortgage Loan. Any repurchase of a Mortgage Loan or
Loans pursuant to the foregoing provisions of this Subsection 9.03 shall be
accomplished by either (a) if the Interim Servicing Agreement has been entered
into and is in effect, deposit in the Custodial Account of the amount of the
Repurchase Price for distribution to the Purchaser on the next scheduled
Remittance Date, 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 or (b) if the Interim Servicing Agreement has not been
entered into or is no longer in effect, by direct remittance of the Repurchase
Price to the Purchaser or its designee in accordance with the Purchaser's
instructions.
At the time of repurchase or substitution, the Purchaser and the
Seller shall arrange for the reassignment of the Deleted Mortgage Loan to the
Seller and the delivery to the Seller of any documents held by the Custodian
relating to the Deleted Mortgage Loan. In the event of a repurchase or
substitution, the Seller shall, simultaneously with such reassignment, give
written notice to the Purchaser that such repurchase or substitution has taken
place, amend the Mortgage Loan Schedule to reflect the withdrawal of the Deleted
Mortgage Loan from this Agreement, and, in the case of substitution, identify a
Qualified Substitute Mortgage Loan and amend the Mortgage Loan Schedule to
reflect the addition of such Qualified Substitute Mortgage Loan to this
Agreement. In connection with any such substitution, the Seller shall be deemed
to have made as to such Qualified Substitute Mortgage Loan the representations
and warranties set forth in this Agreement except that all such representations
and warranties set forth in this Agreement shall be deemed made as of the date
of such substitution. The Seller shall effect such substitution by delivering to
the Custodian or to such other party as the Purchaser may designate
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in writing for such Qualified Substitute Mortgage Loan the documents required by
Subsection 6.03, with the Mortgage Note endorsed as required by Subsection 6.03.
No substitution will be made in any calendar month after the Determination Date
for such month. The Seller shall cause the Interim Servicer to remit directly to
the Purchaser, or its designee in accordance with the Purchaser's instructions
the Monthly Payment less the Servicing Fee due, if any, on such Qualified
Substitute Mortgage Loan or Loans in the month following the date of such
substitution. Monthly Payments due with respect to Qualified Substitute Mortgage
Loans in the month of substitution shall be retained by the Seller. For the
month of substitution, distributions to the Purchaser shall include the Monthly
Payment due on any Deleted Mortgage Loan in the month of substitution, and the
Seller shall thereafter be entitled to retain all amounts subsequently received
by the Seller in respect of such Deleted Mortgage Loan.
For any month in which the Seller substitutes a Qualified Substitute
Mortgage Loan for a Deleted Mortgage Loan, the Seller shall determine the amount
(if any) by which the aggregate principal balance of all Qualified Substitute
Mortgage Loans as of the date of substitution is less than the aggregate Stated
Principal Balance of all Deleted Mortgage Loans (after application of scheduled
principal payments due in the month of substitution). The amount of such
shortfall shall be distributed by the Seller directly to the Purchaser or its
designee in accordance with the Purchaser's instructions within two (2) Business
Days of such substitution.
In addition to such repurchase or substitution obligation, the Seller
shall indemnify the Purchaser and its present and former directors, officers,
employees and agents and any Successor Servicer and its present and former
directors, officers, employees and agents and hold such parties harmless against
any losses, damages, penalties, fines, forfeitures, legal fees and expenses 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 Seller representations and warranties contained in this Agreement
or any Reconstitution Agreement. It is understood and agreed that the
obligations of the Seller set forth in this Subsection 9.03 and Subsection 14.01
to cure, substitute for or repurchase a defective Mortgage Loan and to indemnify
the Purchaser and Successor Servicer as provided in this Subsection 9.03
constitute the sole remedies of the Purchaser and Successor Servicer respecting
a breach of the foregoing representations and warranties. For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean any Person designated as the
Successor Servicer pursuant to this Agreement and any and all Persons who
previously were "Successor Servicers" pursuant to this Agreement.
Any cause of action against the Seller relating to or arising out of
the breach of any representations and warranties made in Subsections 9.01 and
9.02 shall accrue as to any Mortgage Loan upon (i) discovery of such breach by
the Purchaser or notice thereof by the Seller to the Purchaser, (ii) failure by
the Seller to cure such breach or repurchase such Mortgage Loan as specified
above, and (iii) demand upon the Seller by the Purchaser for compliance with
this Agreement.
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Subsection 9.04 Repurchase of Mortgage Loans That Prepay in Full.
If any Mortgage Loan is prepaid within thirty (30) days from and after
the related Closing Date, the Seller shall pay to the Purchaser, within thirty
(30) business days of such prepayment in full, an amount equal to the Premium
Percentage multiplied by the outstanding principal balance of such Mortgage Loan
as of the date of such prepayment in full (less, in the case of any prepayment
accompanied by a prepayment premium, the amount of such prepayment premium).
Subsection 9.05 Repurchase of Mortgage Loans with First Payment
Defaults.
(a) If the related Mortgagor is delinquent with respect to the
Mortgage Loan's first Monthly Payment after origination of such Mortgage Loan,
the Seller, at the Purchaser's option exercised in its sole discretion, shall
repurchase such Mortgage Loan from the Purchaser at a price equal to the
percentage of par as stated in the related Purchase Price and Terms Agreement
(subject to adjustment as provided therein) multiplied by the then outstanding
principal balance of such Mortgage Loan, plus accrued and unpaid interest
thereon from the date to which interest was last paid through the day prior to
the repurchase date at the applicable Mortgage Interest Rate, plus any
outstanding advances owed to any servicer in connection with such Mortgage Loan.
(b) If the related Mortgagor is delinquent with respect to the
Mortgage Loan's Monthly Payment due in the month in which the related Closing
Date occurs or the Monthly Payment due in the first calendar month following the
month in which the related Closing Date occurs, in each case on its due date or
within the grace period, all in accordance with the terms of the related
Mortgage Note, the Seller, at the Purchaser's option exercised in its sole
discretion, shall repurchase such Mortgage Loan from the Purchaser at a price
equal to the percentage of par as stated in the related Purchase Price and Terms
Agreement (subject to adjustment as provided therein) multiplied by the then
outstanding principal balance of such Mortgage Loan, plus accrued and unpaid
interest thereon from the date to which interest was last paid through the day
prior to the repurchase date at the applicable Mortgage Interest Rate, plus any
outstanding advances owed to any servicer in connection with such Mortgage Loan.
SECTION 10. Closing.
The closing for the purchase and sale of each Mortgage Loan Package
shall take place on the related Closing Date. At the Purchaser's option, the
Closing shall be either: by telephone, confirmed by letter or wire as the
parties shall agree, or conducted in person, at such place as the parties shall
agree.
The closing for the Mortgage Loans to be purchased on each Closing
Date shall be subject to each of the following conditions:
(a) at least two Business Days prior to the related Closing Date, the
Seller shall deliver to the Purchaser, in electronic format
acceptable to the Purchaser in its sole discretion, a listing on
a loan-level basis of the
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necessary information to compute the Purchase Price of the
Mortgage Loans delivered on the Closing Date (including accrued
interest), and prepare a Mortgage Loan Schedule;
(b) all of the representations and warranties of the Seller under
this Agreement and of the Interim Servicer under the Interim
Servicing Agreement (with respect to each Mortgage Loan for an
interim period, as specified therein) 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 or an Event of Default under the
Interim Servicing Agreement;
(c) the Purchaser shall have received, or the Purchaser's attorneys
shall have received in escrow, all closing documents as specified
in Section 11 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 terms
hereof;
(d) the Seller shall have delivered and released to the Custodian all
documents required pursuant to this Agreement; and
(e) all other terms and conditions of this Agreement and the related
Purchase Price and Terms Agreement shall have been complied with.
Subject to the foregoing conditions, the Purchaser shall pay to the
Seller on the related Closing Date the Purchase Price, plus accrued interest
pursuant to Section 4 of this Agreement, by wire transfer of immediately
available funds to the account designated by the Seller.
SECTION 11. Closing Documents.
The Closing Documents for the Mortgage Loans to be purchased on each
Closing Date shall consist of fully executed originals of the following
documents:
(1) this Agreement (to be executed and delivered only for the initial
Closing Date);
(2) the Interim Servicing Agreement, dated as of the initial Cut-off
Date, in the form of Exhibit B hereto (to be executed and delivered only for the
initial Closing Date);
(3) with respect to the initial Closing Date, the Custodial Agreement,
dated as of the initial Cut-off Date;
(4) the related Mortgage Loan Schedule, segregated by Mortgage Loan
Package, one copy to be attached hereto, one copy to be attached to the
Custodian's counterpart of the Custodial Agreement, and one copy to be attached
to the related Assignment and Conveyance as the Mortgage Loan Schedule thereto;
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(5) a Custodian's Certification, as required under the Custodial
Agreement, in the form of Exhibit G-1 to the Custodial Agreement;
(6) with respect to the initial Closing Date, a Custodial Account
Letter Agreement or a Custodial Account Certification, as applicable, as
required under the Interim Servicing Agreement;
(7) with respect to the initial Closing Date, an Escrow Account Letter
Agreement or an Escrow Account Certification, as applicable, as required under
the Interim Servicing Agreement;
(8) with respect to the initial Closing Date, an Officer's
Certificate, in the form of Exhibit C hereto with respect to each of the Seller
and the Interim Servicer, including all attachments hereto; with respect to
subsequent Closing Dates, an Officer's Certificate upon request of the
Purchaser;
(9) with respect to the initial Closing Date, an Opinion of Counsel of
each of the Seller and the Interim Servicer (who may be an employee of the
Seller or the Interim Servicer, as applicable), in the form of Exhibit D hereto
("Opinion of Counsel of the Seller"); with respect to subsequent Closing Dates,
an Opinion of Counsel of the Seller upon request of the Purchaser;
(10) with respect to the initial Closing Date, an Opinion of Counsel
of the Custodian (who may be an employee of the Custodian), in the form of an
exhibit to the Custodial Agreement;
(11) a Security Release Certification, in the form of Exhibit E or F,
as applicable, hereto executed by any person, as requested by the Purchaser, if
any of the Mortgage Loans have at any time been subject to any security
interest, pledge or hypothecation for the benefit of such person;
(12) a certificate or other evidence of merger or change of name,
signed or stamped by the applicable regulatory authority, if any of the Mortgage
Loans were acquired by the Seller by merger or acquired or originated by the
Seller while conducting business under a name other than its present name, if
applicable;
(13) with respect to the initial Closing Date, the Underwriting
Guidelines to be attached to the related Assignment and Conveyance as Exhibit C;
(14) Assignment and Conveyance Agreement in the form of Exhibit H
hereto;
(15) Exhibit B to the related Assignment and Conveyance Agreement; and
(16) a MERS Report reflecting the Purchaser as Investor and no Person
as Interim Funder for each MERS Designated Mortgage Loan.
The Seller shall bear the risk of loss of the closing documents until
such time as they are received by the Purchaser or its attorneys. SECTION 12.
Costs.
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The Purchaser shall pay any commissions due its salesmen and the legal
fees and expenses of its attorneys and custodial fees. All other costs and
expenses incurred in connection with the transfer and delivery of the Mortgage
Loans and the Servicing Rights including recording fees, fees for title policy
endorsements and continuations, fees for recording Assignments of Mortgage, and
the Seller's attorney's fees, shall be paid by the Seller.
SECTION 13. Cooperation of Seller with a Reconstitution.
The Seller and the Purchaser agree that with respect to some or all of
the Mortgage Loans, after each Closing Date, on one or more dates (each, a
"Reconstitution Date") at the Purchaser's sole option, the Purchaser may effect
a Reconstitution of some or all of the Mortgage Loans then subject to this
Agreement, without recourse, to:
(a) Xxxxxx Xxx under its Cash Purchase Program or MBS Program
(Special Servicing Option) (each, a "Xxxxxx Mae Transfer"); or
(b) Xxxxxxx Mac (the "Xxxxxxx Mac Transfer"); or
(c) one or more third party purchasers in one or more Whole Loan
Transfers; or
(d) one or more trusts or other entities to be formed as part of one
or more Securitization Transactions.
The Seller agrees to execute in connection with any Agency Transfer,
any and all reasonably acceptable pool purchase contracts, and/or agreements
among the Purchaser, the Seller, Xxxxxx Xxx or Xxxxxxx Mac (as the case may be)
and any servicer in connection with a Whole Loan Transfer, a seller's warranties
and servicing agreement or a participation and servicing agreement in form and
substance reasonably acceptable to the parties, and in connection with a
Securitization Transaction, a pooling and servicing agreement in form and
substance reasonably acceptable to the parties or an Assignment and Recognition
Agreement substantially in the form attached hereto as Exhibit J (collectively,
the agreements referred to herein are designated, the "Reconstitution
Agreements"), together with an opinion of counsel with respect to such
Reconstitution Agreements.
With respect to each Whole Loan Transfer and each Securitization
Transaction entered into by the Purchaser, the Seller agrees (1) to cooperate
fully with the Purchaser and any prospective purchaser with respect to all
reasonable requests and due diligence procedures; (2) to execute, deliver and
perform all Reconstitution Agreements required by the Purchaser; (3) to restate
the representations and warranties set forth in this Agreement and the Interim
Servicing Agreement as of the related Reconstitution Date or make the
representations and warranties set forth in the related selling/servicing guide
of the servicer or issuer, as the case may be, or such representations or
warranties as may be required by any Rating Agency or prospective purchaser of
the related securities or such Mortgage Loans, in connection with such
Reconstitution. The Seller shall provide to such servicer or issuer, as the case
may be, and any other participants or
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purchasers in such Reconstitution: (i) any and all information and appropriate
verification of information which may be reasonably available to the Seller or
its affiliates, whether through letters of its auditors and counsel or
otherwise, as the Purchaser or any such other participant shall request; and
(ii) such additional representations, warranties, covenants, opinions of
counsel, letters from auditors, and certificates of public officials or officers
of the Seller or the Interim Servicer as are reasonably believed necessary by
the Purchaser or any such other participant; and (iii) to execute, deliver and
satisfy all conditions set forth in any indemnity agreement required by the
Purchaser or any such participant, including, without limitation, an
Indemnification and Contribution Agreement in substantially the form attached
hereto as Exhibit K. Moreover, the Seller agrees to cooperate with all
reasonable requests made by the Purchaser to effect such Reconstitution
Agreements. The Seller shall indemnify the Purchaser, each affiliate of the
Purchaser participating in the Reconstitution and each person who controls the
Purchaser or such affiliate and their respective present and former directors,
officers, employees and agents, and 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 each of
them may sustain in any way related to any information provided by or on behalf
of the Seller regarding the Seller, the Seller's servicing practices or
performance, the Mortgage Loans or the Underwriting Guidelines set forth in any
offering document prepared in connection with any Reconstitution. For purposes
of the previous sentence, "Purchaser" shall mean the Person then acting as the
Purchaser under this Agreement and any and all Persons who previously were
"Purchasers" under this Agreement.
In the event the Purchaser has elected to have the Interim Servicer or
the Seller hold record title to the Mortgages, prior to the Reconstitution Date,
the Interim Servicer or the Seller shall prepare an assignment of mortgage in
blank or to the prospective purchaser or trustee, as applicable, from the
Interim Servicer or the Seller, as applicable, acceptable to the prospective
purchaser or trustee, as applicable, for each Mortgage Loan that is part of the
Reconstitution and shall pay all preparation and recording costs associated
therewith. In connection with the Reconstitution, the Interim Servicer shall
execute or shall cause the Seller to execute each Assignment of Mortgage (except
with respect to each MERS Designated Mortgage Loan), track such Assignments of
Mortgage to ensure they have been recorded and deliver them as required by the
prospective purchaser or trustee, as applicable, upon the Interim Servicer's
receipt thereof. Additionally, the Interim Servicer shall prepare and execute or
shall cause the Seller to execute, at the direction of the Purchaser, any note
endorsement in connection with any and all seller/servicer agreements.
All Mortgage Loans not sold or transferred pursuant to a
Reconstitution shall remain subject to this Agreement and, if the Interim
Servicing Agreement shall remain in effect with respect to the related Mortgage
Loan Package, shall continue to be serviced in accordance with the terms of this
Agreement and the Interim Servicing Agreement and with respect thereto this
Agreement shall remain in full force and effect.
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SECTION 14. The Seller.
Subsection 14.01 Additional Indemnification by the Seller; Third Party
Claims.
(a) The Seller shall indemnify the Purchaser and its present and
former directors, officers, employees and agents and any Successor Servicer and
its present and former directors, officers, employees and agents, and hold such
parties harmless against any and all claims, losses, damages, penalties, fines,
forfeitures, legal fees (including legal fees incurred in connection with the
enforcement of the Seller's indemnification obligation under this Section 14.01)
and related costs, judgments, and any other costs, fees and expenses that such
parties may sustain in any way related to the failure of the Seller to perform
its duties and the Interim Servicer to service the Mortgage Loans in strict
compliance with the terms of this Agreement or any Reconstitution Agreement
entered into pursuant to Section 13 or any breach of any of Seller's
representations, warranties and covenants set forth in this Agreement (provided
that such costs shall not include any lost profits). For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean any Person designated as the
Successor Servicer pursuant to this Agreement and any and all Persons who
previously were "Successor Servicers" pursuant to this Agreement.
(b) Promptly after receipt by an indemnified party under this Section
14.01 of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party under
this Section 14.01, notify the indemnifying party in writing of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
the indemnifying party from any liability which it may have to any indemnified
party under this Section 14.01, except to the extent that it has been prejudiced
in any material respect, or from any liability which it may have, otherwise than
under this Section 14.01. In case any such action is brought against any
indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein, and to
the extent that it may elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice from such indemnified party,
to assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party; provided that if the defendants in any such action include
both the indemnified party and the indemnifying party and the indemnified party
or parties shall have reasonably concluded that there may be legal defenses
available to it or them and/or other indemnified parties which 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 counsel, the
indemnifying party will not be liable to such indemnified party for expenses
incurred by the indemnified party in connection with the defense thereof unless
(i) the indemnified party shall have employed separate counsel in connection
with the assertion of legal defenses in accordance with the proviso to the next
preceding sentence (it being understood, however, that the indemnifying party
shall not be liable for the expenses of more than one separate counsel (together
with one local counsel, if applicable)), (ii) the indemnifying party shall not
have
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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 has authorized in writing the
employment of counsel for the indemnified party at the expense of the
indemnifying party; and except that, if clause (i) or (iii) is applicable, such
liability shall be only in respect of the counsel referred to in such clause (i)
or (iii).
Subsection 14.02 Merger or Consolidation of the Seller.
The Seller will keep in full effect its existence, rights and
franchises as a corporation under the laws of the state of its incorporation
except as permitted herein, and will obtain and preserve its qualification to do
business as a foreign corporation 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.
Any Person into which the Seller may be merged or consolidated, or any
corporation resulting from any merger, conversion or consolidation to which the
Seller shall be a party, or any Person succeeding to the business of the Seller,
shall be the successor of the Seller 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
successor or surviving Person shall have a net worth of at least $30,000,000.
SECTION 15. Financial Statements.
The Seller understands that in connection with the Purchaser's
marketing of the Mortgage Loans, the Purchaser shall make available to
prospective purchasers audited financial statements of the Seller for the most
recently completed three fiscal years respecting which such statements are
available, as well as a Consolidated Statement of Condition of the Seller at the
end of the last two fiscal years covered by such Consolidated Statement of
Operations. The Seller shall also make available any comparable interim
statements to the extent any such statements have been prepared by the Seller
(and are available upon request to members or stockholders of the Seller or the
public at large). The Seller, if it has not already done so, agrees to furnish
promptly to the Purchaser copies of the statements specified above. The Seller
shall also make available information on its servicing performance with respect
to loans serviced for others, including delinquency ratios.
The Seller also agrees to allow reasonable access to a knowledgeable
financial or accounting officer for the purpose of answering questions asked by
any prospective purchaser regarding recent developments affecting the Seller or
the financial statements of the Seller.
SECTION 16. Mandatory Delivery; Grant of Security Interest.
The sale and delivery on the related Closing Date of the Mortgage
Loans described on the related Mortgage Loan Schedule is mandatory from and
after the date of the execution of the related Purchase Price and Terms
Agreement, it being specifically understood and agreed that each Mortgage Loan
is unique and identifiable on the date hereof and that an award of money damages
would be insufficient to compensate the Purchaser for the losses and damages
incurred by the Purchaser (including damages to prospective purchasers of the
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Mortgage Loans) in the event of the Seller's failure to deliver (i) each of the
related Mortgage Loans or (ii) one or more Qualified Substitute Mortgage Loans
or (iii) one or more Mortgage Loans otherwise acceptable to the Purchaser on or
before the related Closing Date. The Seller hereby grants to the Purchaser a
lien on and a continuing security interest in each Mortgage Loan and each
document and instrument evidencing each such Mortgage Loan to secure the
performance by the Seller of its obligations under the related Purchase Price
and Terms Agreement, and the Seller agrees that it shall hold such Mortgage
Loans in custody for the Purchaser subject to the Purchaser's (i) right to
reject any Mortgage Loan (or Qualified Substitute Mortgage Loan) under the terms
of this Agreement and to require another Mortgage Loan (or Qualified Substitute
Mortgage Loan) to be substituted therefor, and (ii) obligation to pay the
Purchase Price for the Mortgage Loans. All rights and remedies of the Purchaser
under this Agreement are distinct from, and cumulative with, any other rights or
remedies under this Agreement or afforded by law or equity and all such rights
and remedies may be exercised concurrently, independently or successively.
SECTION 17. Notices.
All demands, notices and communications hereunder shall be in writing
and shall be given via email, facsimile transmission or registered or certified
mail to the person at the address set forth below:
(i) if to the Seller:
First Bank Mortgage
0 Xxxxxxxxxx Xxxxx, Xxxxxxxx X
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxxxx Xxxxx
Fax: 000-000-0000
E-mail: Xxxxx.Xxxxx-Xxxxx@xxxx.xxx
(ii) if to the Purchaser:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx Xxxxxxxx
Fax: 000-000-0000
Email: x.xxxxxxxx@xxxxxx.xxx
with a copy to:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Fax: 000-000-0000
Email: xxxxxx.xxxxx@xxxxxx.xxx
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or such other address as may hereafter be furnished to the other party by like
notice. Any such demand, notice or communication hereunder shall be deemed to
have been received on the date delivered to or received at the premises of the
addressee (as evidenced, in the case of registered or certified mail, by the
date noted on the return receipt).
SECTION 18. Severability Clause.
Any part, provision representation or warranty of this Agreement which
is prohibited or unenforceable or is held to be void or unenforceable in any
jurisdiction shall be ineffective, as to such jurisdiction, to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction as to any Mortgage Loan shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by applicable law, the parties hereto waive any provision of law which prohibits
or renders void or unenforceable any provision hereof. If the invalidity of any
part, provision, representation or warranty of this Agreement shall deprive any
party of the economic benefit intended to be conferred by this Agreement, the
parties shall negotiate, in good-faith, to develop a structure the economic
effect of which is nearly as possible the same as the economic effect of this
Agreement without regard to such invalidity. SECTION 19. Counterparts.
This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original, and all such
counterparts shall constitute one and the same instrument.
SECTION 20. Governing Law Jurisdiction; Consent to Service of Process.
THIS AGREEMENT SHALL BE DEEMED IN EFFECT WHEN A FULLY EXECUTED
COUNTERPART THEREOF IS RECEIVED BY THE PURCHASER IN THE STATE OF NEW YORK AND
SHALL BE DEEMED TO HAVE BEEN MADE IN THE STATE OF NEW YORK. THIS AGREEMENT SHALL
BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT
TO ITS CHOICE OF LAW RULES AND PRINCIPLES. EACH OF THE PURCHASER AND THE SELLER
IRREVOCABLY (I) SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE
STATE OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE
SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT; (II) WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW,
THE DEFENSE OF AN INCONVENIENT FORUM IN ANY ACTION OR PROCEEDING IN ANY SUCH
COURT; (III) AGREES THAT A FINAL JUDGMENT IN ANY ACTION OR PROCEEDING IN ANY
SUCH COURT SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW; AND (IV) CONSENTS
TO SERVICE OF PROCESS UPON IT BY MAILING A COPY THEREOF BY CERTIFIED MAIL
ADDRESSED TO IT AS PROVIDED FOR NOTICES HEREUNDER.
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SECTION 21. Intention of the Parties.
It is the intention of the parties that the Purchaser is purchasing,
and the Seller is selling the Mortgage Loans and not a debt instrument of the
Seller or another security. Accordingly, the parties hereto each intend to treat
the transaction for Federal income tax purposes as a sale by the Seller, and a
purchase by the Purchaser, of the Mortgage Loans. Moreover, the arrangement
under which the Mortgage Loans are held shall be consistent with classification
of such arrangement as a grantor trust in the event it is not found to represent
direct ownership of the Mortgage Loans. The Purchaser shall have the right to
review the Mortgage Loans and the related Mortgage Loan Files to determine the
characteristics of the Mortgage Loans which shall affect the Federal income tax
consequences of owning the Mortgage Loans and the Seller shall cooperate with
all reasonable requests made by the Purchaser in the course of such review.
SECTION 22. Successors and Assigns; Assignment of Purchase Agreement.
This Agreement shall bind and inure to the benefit of and be
enforceable by the Seller and the Purchaser and the respective permitted
successors and assigns of the Seller and the successors and assigns of the
Purchaser. This Agreement shall not be assigned, pledged or hypothecated by the
Seller to a third party without the prior written consent of the Purchaser,
which consent may be withheld by the Purchaser in its sole discretion. This
Agreement may be assigned, pledged or hypothecated by the Purchaser in whole or
in part, and with respect to one or more of the Mortgage Loans, without the
consent of the Seller. There shall be no limitation on the number of assignments
or transfers allowable by the Purchaser with respect to the Mortgage Loans and
this Agreement. In the event the Purchaser assigns this Agreement, and the
assignee assumes any of the Purchaser's obligations hereunder, the Seller
acknowledges and agrees to look solely to such assignee, and not to the
Purchaser, for performance of the obligations so assumed and the Purchaser shall
be relieved from any liability to the Seller with respect thereto.
SECTION 23. Waivers.
No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced.
SECTION 24. Exhibits.
The exhibits to this Agreement are hereby incorporated and made a part
hereof and are an integral part of this Agreement.
SECTION 25. General Interpretive Principles.
For purposes of this Agreement, except as otherwise expressly provided
or unless the context otherwise requires:
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(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) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;
(c) 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;
(d) 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;
(e) 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
(f) the term "include" or "including" shall mean without limitation by
reason of enumeration.
SECTION 26. Reproduction of Documents.
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications which may hereafter be
executed, (b) documents received by any party at the closing, and (c) financial
statements, certificates and other information previously or hereafter
furnished, may be reproduced by any photographic, photostatic, microfilm,
micro-card, miniature photographic or other similar process. The parties agree
that any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding, whether or not the original
is in existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
SECTION 27. Further Agreements.
The Seller and the Purchaser each agree to execute and deliver to the
other such reasonable and appropriate additional documents, instruments or
agreements as may be necessary or appropriate to effectuate the purposes of this
Agreement.
SECTION 28. Recordation of Assignments of Mortgage.
To the extent permitted by applicable law, each of the Assignments of
Mortgage is subject to recordation in all appropriate public offices for real
property records in all the counties or their comparable jurisdictions in which
any or all of the Mortgaged Properties are situated, and in any other
appropriate public recording office or elsewhere, such recordation to be
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effected at the Seller's expense in the event recordation is either necessary
under applicable law or requested by the Purchaser at its sole option.
SECTION 29. No Solicitation.
From and after the Closing Date, the Seller agrees that it will not
take any action or permit or cause any action to be taken by any of its agents
or affiliates, or by any independent contractors on the Seller's behalf, to
personally, by telephone or mail, solicit the borrower or obligor under any
Mortgage Loan for any purpose whatsoever, including to refinance a Mortgage
Loan, in whole or in part, without the prior written consent of the Purchaser.
It is understood and agreed that all rights and benefits relating to the
solicitation of any Mortgagors and the attendant rights, title and interest in
and to the list of such Mortgagors and data relating to their Mortgages
(including insurance renewal dates) shall be transferred to the Purchaser
pursuant hereto on the Closing Date and the Seller shall take no action to
undermine these rights and benefits. Notwithstanding the foregoing, it is
understood and agreed that promotions undertaken by the Seller or any affiliate
of the Seller which are directed to the general public at large, including,
without limitation, mass mailing based on commercially acquired mailing lists,
newspaper, radio and television advertisements shall not constitute solicitation
under this Section 29.
SECTION 30. Waiver of Trial by Jury.
THE SELLER AND THE PURCHASER EACH KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR RELATING TO THIS
AGREEMENT.
SECTION 31. Compliance with Regulation AB
Subsection 31.01 Intent of the Parties; Reasonableness.
The Purchaser and the Seller acknowledge and agree that the purpose of
Section 31 of this Agreement 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 Seller 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 Seller 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
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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 Seller
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 Seller, 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.
The Purchaser (including any of its assignees or designees) shall
cooperate with the Seller 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.
Subsection 31.02 Additional Representations and Warranties of the Seller.
(a) The Seller shall be deemed to represent to the Purchaser and to
any Depositor, as of the date on which information is first provided to the
Purchaser or any Depositor under Subsection 31.03 that, except as disclosed in
writing to the Purchaser or such Depositor prior to such date: (i) the Seller 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 Seller; (ii) the Interim Servicer 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; (iii) no material noncompliance with the applicable servicing
criteria with respect to other securitizations of residential mortgage loans
involving the Interim Servicer as servicer has been disclosed or reported by the
Seller; (iv) no material changes to the Interim Servicer's policies or
procedures with respect to the servicing function it will perform under the
Interim Servicing 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; (v) there
are no aspects of the Interim Servicer's financial condition that could have a
material adverse effect on the performance by the Interim Servicer of its
servicing obligations under the Interim Servicing Agreement or any
Reconstitution Agreement; (vi) there are no material legal or governmental
proceedings pending (or known to be contemplated) against the Seller, Interim
Servicer, any Subservicer or any Third-Party Originator; and (vii) there are no
affiliations, relationships or transactions relating to the Seller, Interim
Servicer, 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 or any Depositor on any date
following the date on which information is first provided to the Purchaser or
any Depositor under Subsection 31.03, the Seller shall, within five Business
Days following such request, confirm in writing the accuracy of the
representations and warranties set forth in paragraph (a) of this Section 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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Subsection 31.03 Information to Be Provided by the Seller.
In connection with any Securitization Transaction the Seller shall (i)
within five 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 to provide), in writing and in form and substance
reasonably satisfactory to the Purchaser and such Depositor, the information and
materials specified in paragraphs (a) and (b) of this Section, and (ii) as
promptly as practicable following notice to or discovery by the Seller, 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 (d) of this Section.
(a) If so requested by the Purchaser or any Depositor, the Seller
shall provide such information regarding (i) the Seller, as originator of the
Mortgage Loans (including as an acquirer of Mortgage Loans from a Qualified
Correspondent), or (ii) each Third-Party Originator, 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:
(A) the originator's form of organization;
(B) 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 or any Depositor, 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;
(C) a description of any material legal or governmental
proceedings pending (or known to be contemplated) against the Seller and
each Third-Party Originator; and
(D) a description of any affiliation or relationship between the
Seller, each Third-Party Originator and any of the following parties to a
Securitization Transaction, as such parties are identified to the Seller by
the Purchaser or any Depositor in writing in advance of such Securitization
Transaction:
(1) the sponsor;
(2) the depositor;
(3) the issuing entity;
(4) any servicer;
(5) any trustee;
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(6) any originator;
(7) any significant obligor;
(8) any enhancement or support provider; and
(9) any other material transaction party.
(b) If so requested by the Purchaser or any Depositor, the Seller
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 (i) the Seller, if the Seller is an originator of Mortgage Loans
(including as an acquirer of Mortgage Loans from a Qualified Correspondent),
and/or (ii) each Third-Party Originator. Such Static Pool Information shall be
prepared by the Seller (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 Seller
(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 Seller, 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.
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 Seller 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
Seller.
If so requested by the Purchaser or any Depositor, the Seller 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 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
Seller'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 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
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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.
(c) [Reserved].
(d) 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 Seller shall (or shall cause each
Third-Party Originator to) (i) notify the Purchaser and any Depositor in writing
of (A) any material litigation or governmental proceedings pending against the
Seller or any Third-Party Originator and (B) any affiliations or relationships
that develop following the closing date of a Securitization Transaction between
the Seller or any Third-Party Originator and any of the parties specified in
clause (D) of paragraph (a) of this Section (and any other parties identified in
writing by the requesting party) with respect to such Securitization
Transaction, and (ii) provide to the Purchaser and any Depositor a description
of such proceedings, affiliations or relationships.
Subsection 31.04 Indemnification; Remedies.
(a) The Seller 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:
(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 this
Section 31 by or on behalf of the Seller, or provided under this Section 31
by or on behalf of any Third-Party Originator (collectively, the "Seller
Information"), or (B) the omission or alleged omission to state in the
Seller Information a material fact required to be stated in the Seller
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 Seller Information and not to any
other information communicated in connection with a sale or purchase of
securities, without regard to whether the Seller Information or any portion
thereof is presented together with or separately from such other
information;
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(ii) any failure by the Seller or any Third-Party Originator to
deliver any information, report, certification, accountants' letter or
other material when and as required under this Section 31; or
(iii) any breach by the Seller of a representation or warranty set
forth in Subsection 31.02(a) or in a writing furnished pursuant to
Subsection 31.02(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 Seller of a representation
or warranty in a writing furnished pursuant to Subsection 31.02(b) to the
extent made as of a date subsequent to such closing date.
In the case of any failure of performance described in clause (a)(ii)
of this Section, the Seller 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 Seller or
any Third-Party Originator.
(b) (i) Any failure by the Seller or any Third-Party Originator to
deliver any information, report, certification, accountants' letter or other
material when and as required under this Section 31, or any breach by the Seller
of a representation or warranty set forth in Subsection 31.02(a) or in a writing
furnished pursuant to Subsection 31.02(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 Seller of a
representation or warranty in a writing furnished pursuant to Subsection
31.02(b) to the extent made as of a date subsequent to such closing date, shall
immediately and automatically, without notice or grace period, constitute an
Event of Default with respect to the Seller 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 Interim Servicer as servicer under the Interim Servicing
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 Interim Servicer; 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 Interim Servicer as servicer, such
provision shall be given effect.
[Signatures Commence on Following Page]
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IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed hereto by their respective officers thereunto duly authorized
as of the date first above written.
IXIS REAL ESTATE CAPITAL INC.
(Purchaser)
By: /s/ Xxxxx Xxxxx
--------------------------------------
Name: Xxxxx Xxxxx
Title: Director
By: /s/ Xxxxxxx Xxxxxxx
--------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Managing Director
FIRST BANC MORTGAGE, INC.
(Seller)
By: /s/ Xxxxxxxxx X. Xxxxx
--------------------------------------
Name: Xxxxxxxxx X. Xxxxx
Its: Vice President - Loan Operations
Exhibit A
EXHIBIT A
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 delivered to the
Custodian, or to such other Person as the Purchaser shall designate in writing,
pursuant to Section 6 of the Mortgage Loan Purchase and Warranties Agreement to
which this Exhibit is attached (the "Agreement"):
(c) the original Mortgage Note bearing all intervening
endorsements evidencing a complete chain of assignment from the originator to
the Seller, endorsed "Pay to the order of _________, without recourse" and
signed in the name of the Seller by an authorized officer. To the extent that
there is no room on the face of the Mortgage Notes for endorsements, the
endorsement may be contained on an allonge, if state law so allows and the
Custodian is so advised by the Seller that state law so allows. If the Mortgage
Loan was acquired by the Seller in a merger, the endorsement must be by
"[Seller], successor by merger to [name of predecessor]." If the Mortgage Loan
was acquired or originated by the Seller while doing business under another
name, the endorsement must be by "[Seller], formerly known as [previous name]";
(d) the original of any guarantee executed in connection with the
Mortgage Note;
(e) the original Mortgage with evidence of recording thereon. If in
connection with any Mortgage Loan, the Seller 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 Seller 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
Seller 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 Seller; 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 to be
a true and complete copy of the original recorded Mortgage;
(f) the originals of all assumption, modification, consolidation or
extension agreements, if any, with evidence of recording thereon;
(g) except with respect to each MERS Designated Mortgage Loan, the
original Assignment of Mortgage for each Mortgage Loan, in form and substance
acceptable for recording. The Assignment of Mortgage must be duly recorded only
if recordation is either
A-1
necessary under applicable law or commonly required by private institutional
mortgage investors in the area where the Mortgaged Property is located or on
direction of the Purchaser as provided in this Agreement. If the Assignment of
Mortgage is to be recorded, the Mortgage shall be assigned to the Purchaser. If
the Assignment of Mortgage is not to be recorded, the Assignment of Mortgage
shall be delivered in blank. If the Mortgage Loan was acquired by the Seller in
a merger, the Assignment of Mortgage must be made by "[Seller], successor by
merger to [name of predecessor]". If the Mortgage Loan was acquired or
originated by the Seller while doing business under another name, the Assignment
of Mortgage must be by "[Seller], formerly known as [previous name]";
(h) the originals of all intervening assignments of mortgage,
evidencing a complete chain of assignment from the originator to the Seller (or
MERS with respect to each MERS Designated Mortgage Loan), 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
Seller 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 Seller 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 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 Seller; 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;
(i) The original mortgagee policy of title insurance or, in the event
such original title policy is unavailable, a certified true copy of the related
policy binder or commitment for title certified to be true and complete by the
title insurance company; and
(j) security agreement, chattel mortgage or equivalent document
executed in connection with the Mortgage.
In the event an Officer's Certificate of the Seller is delivered to
the Purchaser because of a delay caused by the public recording office in
returning any recorded document, the Seller shall deliver to the Purchaser,
within 90 days of the 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; provided, however, that any recorded document shall
in any event be delivered no later than 1 year from the applicable Closing Date.
An extension of the date specified in (iv) above may be requested from the
Purchaser, which consent shall not be unreasonably withheld.
A-2
Exhibit B
EXHIBIT B
FORM OF INTERIM SERVICING AGREEMENT
B-1
Exhibit C
EXHIBIT C
FORM OF SELLER'S OFFICER'S CERTIFICATE
I, ____________________, hereby certify that I am the duly elected
[Vice] President of ________________ [COMPANY], a [state] [federally] chartered
institution organized under the laws of the [State of ____________] [United
States] (the "Company"), and further as follows:
1. Attached hereto as Exhibit 1 is a true, correct and complete copy of the
charter of the Company which is in full force and effect on the date hereof
and which has been in effect without amendment, waiver, rescission or
modification since ___________.
2. Attached hereto as Exhibit 2 is a true, correct and complete copy of the
bylaws of the Company which are in effect on the date hereof and which have
been in effect without amendment, waiver, rescission or modification since
___________.
3. Attached hereto as Exhibit 3 is an original certificate of good standing of
the Company issued within ten days of the date hereof, and no event has
occurred since the date thereof which would impair such standing.
4. Attached hereto as Exhibit 4 is a true, correct and complete copy of the
corporate resolutions of the Board of Directors of the Company authorizing
the Company to execute and deliver each of the First Amended and Restated
Mortgage Loan Purchase and Warranties Agreement, dated as of January 1,
2006, by and between IXIS Real Estate Capital Inc. (the "Purchaser") and
the Company (the "Purchase Agreement"), the First Amended and Restated
Interim Servicing Agreement, dated as of January 1, 2006, by and between
the Company and the Purchaser (the "Interim Servicing Agreement") [and to
endorse the Mortgage Notes and execute the Assignments of Mortgages by
original [or facsimile] signature,]] and such resolutions are in effect on
the date hereof and have been in effect without amendment, waiver,
rescission or modification since ____________.
5. 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
Purchase Agreement, the Interim Servicing Agreement the sale of the
mortgage loans or the consummation of the transactions contemplated by the
agreements; or (ii) any required consent, approval, authorization or order
has been obtained by the Company.
6. Neither the consummation of the transactions contemplated by, nor the
fulfillment of the terms of the Purchase Agreement and the Interim
Servicing Agreement conflicts or will conflict with or results 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 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.
C-1
7. To the best of my knowledge, there is no action, suit, proceeding or
investigation pending or threatened against the Company which, in my
judgment, 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 Purchase Agreement and
the Interim Servicing Agreement, or the mortgage loans or of any action
taken or to be taken in connection with the transactions contemplated
hereby, or which would be likely to impair materially the ability of the
Company to perform under the terms of the Purchase Agreement and the
Interim Servicing Agreement.
8. Each person listed on Exhibit 5 attached hereto who, as an officer or
representative of the Company, signed (a) the Purchase Agreement, (b) the
Interim Servicing Agreement and (c) any other document delivered or on the
date hereof in connection with any purchase described in the agreements set
forth above was, at the respective times of such signing and delivery, and
is now, a duly elected or appointed, qualified and acting officer or
representative of the Company, who holds the office set forth opposite his
or her name on Exhibit 5, and the signatures of such persons appearing on
such documents are their genuine signatures.
9. The Company is duly authorized to engage in the transactions described and
contemplated in the Purchase Agreement, the Interim Servicing Agreement and
the Custodial Agreement.
C-2
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the
seal of the Company.
Dated: By:
---------------------- ------------------------------------
Name:
------------------------------
[Seal] Title: [Vice] President
I, ________________________, an [Assistant] Secretary of
______________ [COMPANY], hereby certify that ____________ is the duly elected,
qualified and acting [Vice] President of the Company and that the signature
appearing above is [her] [his] genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name.
By:
------------------------------------
Name:
------------------------------
Dated: Title: [Assistant] Secretary
----------------------
C-3
EXHIBIT 5 to
Company's Officer's Certificate
NAME TITLE SIGNATURE
------------------------ ------------------------ ------------------------
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
________________________ ________________________ ________________________
C-4
Exhibit D
EXHIBIT D
FORM OF OPINION OF COUNSEL TO THE SELLER
AND INTERIM SERVICER (DATE)
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
You have requested [our] [my] opinion, as [Assistant] General Counsel
to First Banc Mortgage, Inc. (the "Company"), with respect to certain matters in
connection with the sale by the Company of the Mortgage Loans pursuant to that
certain Mortgage Loan Purchase and Warranties Agreement by and between the
Company and IXIS Real Estate Capital Inc. (the "Purchaser"), dated as of April
1, 2003 (the "Purchase Agreement") which sale is in the form of whole loans,
delivered pursuant to a Custodial Agreement dated as of April 1, 2003 among the
Purchaser, the Company, _______________________________ (the "Interim Servicer")
and ______________________ [CUSTODIAN] (the "Custodial Agreement") and serviced
pursuant to a First Amended and Restated Interim Servicing Agreement, dated as
of January 1, 2006, by and between the Interim Servicer and the Purchaser (the
"Interim Servicing Agreement" and, collectively with the Purchase Agreement and
the Custodial Agreement, the "Agreements"). Capitalized terms not otherwise
defined herein have the meanings set forth in the Purchase Agreement and the
Interim Servicing Agreement.
[We] [I] have examined the following documents:
1. the Purchase Agreement;
2. the Interim Servicing Agreement;
3. the Custodial Agreement;
4. the form of Assignment of Mortgage;
5. the form of endorsement of the Mortgage Notes; and
6. such other documents, records and papers as we have deemed
necessary and relevant as a basis for this opinion.
To the extent [we] [I] have deemed necessary and proper, [we] [I] have
relied upon the representations and warranties of the Company and the Interim
Servicer contained in the Purchase Agreement and in the Interim Servicing
Agreement, as applicable. [We] [I] have assumed the authenticity of all
documents submitted to [us] [me] as originals, the genuineness of all
signatures, the legal capacity of natural persons and the conformity to the
originals of all documents.
D-1
Based upon the foregoing, it is [our] [my] opinion that:
1. The Company and the Interim Servicer is [type of entity] duly
organized, validly existing and in good standing under the laws of the
[United States] and are qualified to transact business in, and is in
good standing under, the laws of [the state of incorporation].
2. Each of the Company and the Interim Servicer has the power to engage
in the transactions contemplated by the Agreements to which it is a
party and all requisite power, authority and legal right to execute
and deliver such Agreements and to perform and observe the terms and
conditions of such Agreements.
3. Each of the Agreements to which it is a party has been duly
authorized, executed and delivered by the Company and the Interim
Servicer, as applicable, and is a legal, valid and binding agreement
enforceable in accordance with its respective terms against the
Company and the Interim Servicer, as applicable, subject to bankruptcy
laws and other similar laws of general application affecting rights of
creditors 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.
4. Each of the Company and the Interim Servicer has been duly authorized
to allow any of its officers to execute any and all documents by
original signature in order to complete the transactions contemplated
by the Agreements to which it is a party by original [or facsimile]
signature in order to execute the endorsements to the Mortgage Notes
and the Assignments of Mortgages, and the original [or facsimile]
signature of the officer at the Company executing the endorsements to
the Mortgage Notes and the Assignments of Mortgages represents the
legal and valid signature of said officer of the Company.
5. 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 or the Interim Servicer of or
compliance by the Company or the Interim Servicer with the Agreements
to which it is a party and the sale of the Mortgage Loans by the
Company or the consummation of the transactions contemplated by the
Agreements to which each is a party or (ii) any required consent,
approval, authorization or order has been obtained by the Company or
the Interim Servicer.
6. Neither the consummation of the transactions contemplated by, nor the
fulfillment of the terms of, the Agreements to which it is a party
conflicts or will conflict with or results or will result in a breach
of or constitutes or will constitute a default under the charter,
by-laws or other organizational documents of the Company or the
Interim Servicer, as applicable, the terms of any indenture or other
agreement or instrument to which the Company or the Interim Servicer
is a party or by which it is bound or to which it is subject, or
violates any statute or
D-2
order, rule, regulations, writ, injunction or decree of any court,
governmental authority or regulatory body to which the Company or the
Interim Servicer is subject or by which it is bound.
7. There is no action, suit, proceeding or investigation pending or
threatened against the Company or the Interim Servicer which, in [our]
[my] judgment, 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 the
Interim Servicer or in any material impairment of the right or ability
of the Company or the Interim Servicer to carry on its business
substantially as now conducted or in any material liability on the
part of the Company or the Interim Servicer or which would draw into
question the validity of the Agreements to which it is a party or the
Mortgage Loans or of any action taken or to be taken in connection
with the transactions contemplated thereby, or which would be likely
to impair the ability of the Company or the Interim Servicer to
perform under the terms of the Agreements to which it is a party.
8. The sale of each Mortgage Note and Mortgage as and in the manner
contemplated by the Agreements is sufficient to fully transfer to the
Purchaser all right, title and interest of the Company thereto as
noteholder and mortgagee.
9. The Mortgages have been duly assigned and the Mortgage Notes have been
duly endorsed as provided in the Custodial Agreement. The Assignments
of Mortgage are in recordable form, except for the insertion of the
name of the assignee, and upon the name of the assignee being
inserted, are acceptable for recording under the laws of the state
where each related Mortgaged Property is located. The endorsement of
the Mortgage Notes, the delivery to the Purchaser, or its designee, of
the Assignments of Mortgage, and the delivery of the original endorsed
Mortgage Notes to the Purchaser, or its designee, are sufficient to
permit the Purchaser to avail itself of all protection available under
applicable law against the claims of any present or future creditors
of the Company, and are sufficient to prevent any other sale,
transfer, assignment, pledge or hypothecation of the Mortgages and the
Mortgage Notes by the Company from being enforceable.
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.
Very truly yours,
----------------------------------------
[Name]
[Assistant] General Counsel
D-3
Exhibit E
EXHIBIT E
FORM OF SECURITY RELEASE CERTIFICATION
____________________,_____
_________________________
_________________________
_________________________
Attention: _________________________________
_________________________________
Re: Notice of Sale and Release of Collateral
Dear Sirs:
This letter serves as notice that First Banc Mortgage, Inc. a Missouri
corporation, organized pursuant to the laws of [the state of incorporation] (the
"Company") has committed to sell to IXIS Real Estate Capital Inc. under a First
Amended and Restated Mortgage Loan Purchase and Warranties Agreement, dated as
of January 1, 2006, certain mortgage loans originated by the Company. The
Company warrants that the mortgage loans to be sold to IXIS Real Estate Capital
Inc. are in addition to and beyond any collateral required to secure advances
made by you to the Company.
The Company acknowledges that the mortgage loans to be sold to IXIS
Real Estate Capital Inc. shall not be used as additional or substitute
collateral for advances made by [____________]. IXIS Real Estate Capital Inc.
understands that the balance of the Company's mortgage loan portfolio may be
used as collateral or additional collateral for advances made by [___________],
and confirms that it has no interest therein.
E-1
Execution of this letter by [___________] shall constitute a full and
complete release of any security interest, claim, or lien which [___________]
may have against the mortgage loans to be sold to IXIS Real Estate Capital Inc.
Very truly yours,
----------------------------------------
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Date:
Acknowledged and approved:
--------------------------
By:
---------------------------------------------------
Name:
-------------------------------------------------
Title:
------------------------------------------------
Date:
-------------------------------------------------
E-2
Exhibit F
EXHIBIT F
FORM OF SECURITY RELEASE CERTIFICATION
I. Release of Security Interest
The financial institution named below hereby relinquishes any and all
right, title and interest it may have in all Mortgage Loans to be purchased by
IXIS Real Estate Capital Inc. from the Company named below pursuant to that
certain First Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of January 1, 2006, and certifies that all notes, mortgages,
assignments and other documents in its possession relating to such Mortgage
Loans have been delivered and released to the Company named below or its
designees, as of the date and time of the sale of such Mortgage Loans to IXIS
Real Estate Capital Inc.
Name and Address of Financial Institution
----------------------------------------
(Name)
----------------------------------------
(Address)
By:
------------------------------------
F-1
II. Certification of Release
The Company named below hereby certifies to IXIS Real Estate Capital
Inc. that, as of the date and time of the sale of the above-mentioned Mortgage
Loans to IXIS Real Estate Capital Inc. the security interests in the Mortgage
Loans released by the above-named financial institution comprise all security
interests relating to or affecting any and all such Mortgage Loans. The Company
warrants that, as of such time, there are and will be no other security
interests affecting any or all of such Mortgage Loans.
---------------------------
By:
------------------------------------
Title:
---------------------------------
Date:
----------------------------------
F-2
Exhibit G
EXHIBIT G
[RESERVED]
X-0
XXXXXXX X
XXXXXXXXXX XXX XXXXXXXXXX
Xx this ___ day of __________, ____, First Banc Mortgage, Inc.
("Seller"), as (i) the Seller under that certain Purchase Price and Terms
Agreement, dated as of [_______] (the "PPTA"), (ii) the Seller under that
certain First Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of January 1, 2006 (the "Purchase Agreement"), and (iii) the
Seller/Interim Servicer under that certain First Amended and Restated Interim
Servicing Agreement, dated as of January 1, 2006 (the "Interim Servicing
Agreement" and, together with the PPTA and the Purchase Agreement, the
"Agreements"), does hereby sell, transfer, assign, set over and convey to IXIS
Real Estate Capital Inc. ("Purchaser") as the Purchaser under the Agreements,
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"), together with the
Mortgage Files and all rights and obligations arising under the documents
contained therein. Each Mortgage Loan subject to the Agreements was underwritten
in accordance with, and conforms to, the Underwriting Guidelines attached hereto
as Exhibit C. Pursuant to Section 6 of the Purchase Agreement, the Seller has
delivered to the Custodian the documents for each Mortgage Loan to be purchased
as set forth in the Custodial Agreement. The contents of each Servicing File
required to be retained by __________________________ ("Interim Servicer") to
service the Mortgage Loans pursuant to the Interim Servicing Agreement and thus
not delivered to the Purchaser are and shall be held in trust by the Seller in
its capacity as Interim Servicer for the benefit of the Purchaser as the owner
thereof. The Interim Servicer's possession of any portion of the Servicing File
is at the will of the Purchaser for the sole purpose of facilitating servicing
of the related Mortgage Loan pursuant to the Interim Servicing Agreement, and
such retention and possession by the Interim Servicer shall be in a custodial
capacity only. The ownership of each Mortgage Note, Mortgage, the Servicing
Rights and the contents of the Mortgage File and Servicing File is vested 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
Seller or the Interim Servicer shall immediately vest in the Purchaser and shall
be retained and maintained, in trust, by the Seller at the will of the Purchaser
in such custodial capacity only.
The Mortgage Loan Package characteristics of the Mortgage Loans
subject hereto are set forth on Exhibit B hereto.
In accordance with Section 6 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]
H-1
FIRST BANC MORTGAGE, INC.
By:
------------------------------------
Name:
------------------------------
Title:
Accepted and Agreed:
IXIS REAL ESTATE CAPITAL INC.
By:
----------------------------------
Name:
----------------------------
Title:
----------------------------
By:
----------------------------------
Name:
----------------------------
Title:
----------------------------
H-2
EXHIBIT A
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
THE MORTGAGE LOANS
H-3
EXHIBIT B
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE POOL
CHARACTERISTICS OF EACH MORTGAGE LOAN PACKAGE
Pool Characteristics of the Mortgage Loan Package as delivered on the
related Closing Date:
No Mortgage Loan has: (1) an outstanding principal balance less than
$_________; (2) an origination date earlier than _ months prior to the related
Cut-off Date; (3) a CLTV of greater than _____%; (4) a FICO Score of less than
___; or (5) a debt-to-income ratio of more than __%. Each First Lien Loan has a
Mortgage Interest Rate of at least ___% per annum and an outstanding principal
balance less than $_________. Each Second Lien Loan has a Mortgage Interest Rate
of at least ______% per annum and an outstanding principal balance less than
$________. Each Adjustable Rate Mortgage Loan has an Index of [_______].
H-4
EXHIBIT C
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
UNDERWRITING GUIDELINES
H-5
Exhibit I
EXHIBIT I
SELLER'S UNDERWRITING GUIDELINES
I-1
Exhibit J
EXHIBIT J
FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated [____________ __,
20__] ("Agreement"), among IXIS Real Estate Capital Inc. ("Assignor"),
[____________________] ("Assignee") and [SELLER] (the "Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns
to the Assignee all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain Mortgage Loan
Purchase and Warranties Agreement (the "Purchase Agreement"), dated as of
[DATE], between the Assignor, as purchaser (the "Purchaser"), and the Company,
as seller, solely insofar as the Purchase Agreement relates to the Mortgage
Loans.
The Assignor specifically reserves and does not assign to the Assignee
hereunder (i) any and all right, title and interest in, to and under and any
obligations of the Assignor with respect to any mortgage loans subject to the
Purchase Agreement which are not the Mortgage Loans set forth on the Mortgage
Loan Schedule and are not the subject of this Agreement or (ii) the rights of
the Purchaser under Section 9.04 of the Purchase Agreement.
Recognition of the Company
2. From and after the date hereof (the "Securitization Closing Date"),
the Company shall and does hereby recognize that the Assignee will transfer the
Mortgage Loans and assign its rights under the Purchase Agreement (solely to the
extent set forth herein) and this Agreement to [__________________] (the
"Trust") created pursuant to a Pooling and Servicing Agreement, dated as of
[______], 2006 (the "Pooling Agreement"), among the Assignee, the Assignor,
[___________________], as trustee (including its successors in interest and any
successor trustees under the Pooling Agreement, the "Trustee"),
[____________________], as servicer (including its successors in interest and
any successor servicer under the Pooling Agreement, the "Servicer"). The Company
hereby acknowledges and agrees that from and after the date hereof (i) the Trust
will be the owner of the Mortgage Loans, (ii) the Company shall look solely to
the Trust for performance of any obligations of the Assignor insofar as they
relate to the Mortgage Loans, (iii) the Trust (including the Trustee and the
Servicer acting on the Trust's behalf) shall have all the rights and remedies
available to the Assignor, insofar as they relate to the Mortgage Loans, under
the Purchase Agreement, including, without limitation, the enforcement of the
document delivery requirements set forth in Section 6 of the Purchase Agreement,
and shall be entitled to enforce all of the obligations of the Company
thereunder insofar as they relate to the Mortgage Loans, and (iv) all references
to the Purchaser, the
J-1
Custodian or the Bailee under the Purchase Agreement insofar as they relate to
the Mortgage Loans, shall be deemed to refer to the Trust (including the Trustee
and the Servicer acting on the Trust's behalf). Neither the Company nor the
Assignor shall amend or agree to amend, modify, waiver, or otherwise alter any
of the terms or provisions of the Purchase Agreement which amendment,
modification, waiver or other alteration would in any way affect the Mortgage
Loans or the Company's performance under the Purchase Agreement with respect to
the Mortgage Loans without the prior written consent of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee
and the Trust as of the date hereof that:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver and
perform its obligations under this Agreement and has full power and authority to
perform its obligations under the Purchase Agreement. The execution by the
Company of this Agreement is in the ordinary course of the Company's business
and will not conflict with, or result in a breach of, any of the terms,
conditions or provisions of the Company's charter or bylaws or any legal
restriction, or any material agreement or instrument to which the Company is now
a party or by which it is bound, or result in the violation of any law, rule,
regulation, order, judgment or decree to which the Company or its property is
subject. The execution, delivery and performance by the Company of this
Agreement have been duly authorized by all necessary corporate action on part of
the Company. This Agreement has been duly executed and delivered by the Company,
and, upon the due authorization, execution and delivery by the Assignor and the
Assignee, will constitute the valid and legally binding obligation of the
Company, enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization, insolvency,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and by general principles of equity regardless of
whether enforceability is considered in a proceeding in equity or at law;
(c) No consent, approval, order or authorization of, or declaration,
filing or registration with, any governmental entity is required to be obtained
or made by the Company in connection with the execution, delivery or performance
by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation pending or
threatened against the Company, before any court, administrative agency or other
tribunal, which would draw into question the validity of this Agreement or the
Purchase Agreement, or which, either in any one instance or in the aggregate,
would result in any material adverse change in the ability of the Company to
perform its obligations under this Agreement or the Purchase Agreement, and the
Company is solvent.
4. Pursuant to Section 13 of the Purchase Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust, that the representations and warranties set forth in Section 9.02
of the Purchase Agreement are true and
J-2
correct as of the date hereof as if such representations and warranties were
made on the date hereof unless otherwise specifically stated in such
representations and warranties.
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee and
the Servicer acting on the Trust's behalf) in connection with any breach of the
representations and warranties made by the Company set forth in Sections 3 and 4
hereof shall be as set forth in Subsection 9.03 of the Purchase Agreement as if
they were set forth herein (including without limitation the repurchase and
indemnity obligations set forth therein).
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced, with the prior
written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors and
assigns of the parties hereto and (ii) the Trust (including the Trustee and the
Servicer acting on the Trust's behalf). Any entity into which Assignor, Assignee
or Company may be merged or consolidated shall, without the requirement for any
further writing, be deemed Assignor, Assignee or Company, respectively,
hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive the
conveyance of the Mortgage Loans and the assignment of the Purchase Agreement
(to the extent assigned hereunder) by Assignor to Assignee and by Assignee to
the Trust and nothing contained herein shall supersede or amend the terms of the
Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
J-3
[SELLER]
By:
------------------------------------
Name:
------------------------------
Its:
-------------------------------
IXIS Real Estate Capital Inc.
By:
------------------------------------
Name:
------------------------------
Its:
-------------------------------
By:
------------------------------------
Name:
------------------------------
Its:
-------------------------------
[--------------------------]
By:
------------------------------------
Name:
------------------------------
Its:
-------------------------------
J-4
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
Mortgage Loan Schedule
J-5
Exhibit K
EXHIBIT K
FORM OF INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AND CONTRIBUTION AGREEMENT ("Agreement"), dated
as of [_______], 200_, [among/between] IXIS Real Estate Capital Inc., a New York
corporation ("IXIS"), [_____________], a [_______________] (the "Seller") and
[_____________], a [_______________] [(the "Initial Servicer")].
WHEREAS, [________________] (the "Depositor"), is acting as depositor
and registrant with respect to the Prospectus, dated [________________], and the
Prospectus Supplement to the Prospectus, [________________] (the "Prospectus
Supplement"), relating to [________________] Certificates (the "Certificates")
to be issued pursuant to a Pooling and Servicing Agreement, dated as of
[________________] (the "P&S"), among the Depositor, as depositor,
[________________], as servicer (the "Servicer"), and
[________________], as trustee (the "Trustee");
WHEREAS, as an inducement to the Depositor to enter into the P&S, and
[____________________] (the "Underwriter[s]") to enter into the Underwriting
Agreement, dated [____________________] (the "Underwriting Agreement") between
the Depositor and the Underwriter[s], Seller has agreed to provide for
indemnification and contribution on the terms and conditions hereinafter set
forth;
WHEREAS, IXIS purchased from Seller certain of the Mortgage Loans
underlying the Certificates (the "Mortgage Loans") from Seller pursuant to a
Mortgage Loan Purchase and Warranties Agreement, dated as of [DATE] (the
"Purchase Agreement"), by and between IXIS and Seller; and
WHEREAS, pursuant to Section 13 of the Purchase Agreement, Seller has
agreed to indemnify IXIS, the Depositor, the Underwriter[s] and their respective
affiliates, present and former directors, officers, employees and agents.
NOW THEREFORE, in consideration of the agreements contained herein,
and other valuable consideration the receipt and sufficiency of which are hereby
acknowledged, Seller and IXIS agree as follows:
1. Indemnification and Contribution.
(a) Seller [and Initial Servicer] agrees to indemnify and hold
harmless IXIS, the Depositor, the Underwriter[s] and their respective
affiliates, present and former directors, officers, employees and agents and
each person, if any, who controls IXIS, the Depositor, the Underwriter[s] or
such affiliate within the meaning of either Section 15 of the Securities Act of
1933, as amended (the "1933 Act"), or Section 20 of the Securities Exchange Act
of 1934, as
K-1
amended (the "1934 Act"), against any and all losses, claims, damages or
liabilities, joint or several, to which they or any of them may become subject
under the 1933 Act, the 1934 Act or other federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based in
whole or in part upon any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus Supplement, ABS Informational and
Computational Material or in the Free Writing Prospectus or any omission or
alleged omission to state in the Prospectus Supplement, ABS Informational and
Computational Material or in the Free Writing Prospectus 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, or any such
untrue statement or omission or alleged untrue statement or alleged omission
made in any amendment of or supplement to the Prospectus Supplement, ABS
Informational and Computational Material or the Free Writing Prospectus and
agrees to reimburse IXIS, the Depositor, the Underwriter[s] or such affiliates
and each such officer, director, employee, agent and controlling person promptly
upon demand for any legal or other expenses reasonably incurred by any of them
in connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that Seller [and Initial Servicer] shall be liable in any
such case only to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in reliance upon and in
conformity with the Seller Information[ and Servicer Information]. The foregoing
indemnity agreement is in addition to any liability which Seller[ and the
Initial Servicer] may otherwise have to IXIS, the Depositor, the Underwriter[s]
its affiliates or any such director, officer, employee, agent or controlling
person of IXIS, the Depositor, the Underwriter[s] or their respective
affiliates.
As used herein:
"Seller Information" means any information relating to Seller, the
Mortgage Loans and/or the underwriting guidelines[ and/or servicing guidelines]
relating to the Mortgage Loans set forth in the Prospectus Supplement, ABS
Informational and Computational Material or the Free Writing Prospectus [and
static pool information regarding mortgage loans originated or acquired by the
Seller [and included in the Prospectus Supplement, ABS Informational and
Computational Material, the Offering Circular or the Free Writing Prospectus]
[incorporated by reference from the website located at [______________]].
"Free Writing Prospectus" means any written communication that
constitutes a "free writing prospectus," as defined in Rule 405 under the 1933
Act.
"ABS Informational and Computational Material" means any written
communication as defined in Item 1101(a) of Regulation AB under the 1933 Act and
the 1934 Act, as amended from time to time.
["Servicer Information" means any information relating to Initial
Servicer, the Mortgage Loans and/or the servicing guidelines relating to the
Mortgage Loans set forth in the Prospectus Supplement, ABS Informational and
Computational Material or the Free Writing Prospectus [and static pool
information regarding mortgage loans originated or acquired by the Initial
Servicer [and included in the Prospectus Supplement, the Offering Circular, ABS
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Informational and Computational Material or the Free Writing Prospectus]
[incorporated by reference from the website located at [______________]].]
(b)______Promptly after receipt by any indemnified party under this
Section 1 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 this Section 1, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 1 except to the extent it has
been materially prejudiced by such failure; and provided, further, however, that
the failure to notify any indemnifying party shall not relieve it from any
liability which it may have to any indemnified party otherwise than under this
Section 1.
If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, except as provided in
the following paragraph, the indemnifying party shall not be liable to the
indemnified party under this Section 1 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation.
Any indemnified party shall have the right to employ separate counsel
in any such action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
necessary or appropriate for such indemnified party to employ separate counsel;
or (iii) the indemnifying party has failed to assume the defense of such action
and employ counsel reasonably satisfactory to the indemnified party, in which
case, if such indemnified party notifies the indemnifying party in writing that
it elects to employ separate counsel at the expense of the indemnifying party,
the indemnifying party shall not have the right to assume the defense of such
action on behalf of such indemnified party, it being understood, however, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to local counsel) at any time for all such indemnified parties.
Each indemnified party, as a condition of the indemnity agreements
contained in this Section 1, shall cooperate with the indemnifying party in the
defense of any such action or claim. No indemnifying party shall be liable for
any settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment for the plaintiff in any such action,
the
K-3
indemnifying party agrees to indemnify and hold harmless any indemnified party
from and against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified
party shall have requested an indemnifying party to reimburse the indemnified
party for reasonable fees and expenses of counsel, the indemnifying party agrees
that it shall be liable for any settlement of any proceeding effected without
its written consent if (i) such settlement is entered into more than 30 days
after receipt by such indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement.
(c) If the indemnification provided for in this Section 1 is
unavailable to an indemnified party, then the indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages or
liabilities, in such proportion as is appropriate to reflect the relative fault
of the indemnifying party and the indemnified party, respectively, in connection
with the statements or omissions that result in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault of the indemnified party and indemnifying party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by such parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission and any other equitable considerations.
(d) The indemnity and contribution agreements contained in this
Section 1 and the representations and warranties set forth in Section 2 shall
remain operative and in full force and effect regardless of (i) any termination
of this Agreement, (ii) any investigation made by IXIS, the Depositor, the
Underwriter[s] their respective affiliates, directors, officers, employees or
agents or any person controlling IXIS, the Depositor, the Underwriter[s] or any
such affiliate and (iii) acceptance of and payment for any of the Offered
Certificates.
2. Representations and Warranties. Seller [and Initial Servicer]
represents and warrants that:
(i) Seller [and Initial Servicer] is validly existing and in good
standing under the laws of its jurisdiction of formation or
incorporation, as applicable, and has full power and authority to own
its assets and to transact the business in which it is currently
engaged. Seller [and Initial Servicer] is duly qualified to do
business and is in good standing in each jurisdiction in which the
character of the business transacted by it or any properties owned or
leased by it requires such qualification and in which the failure so
to qualify would have a material adverse effect on the business,
properties, assets or condition (financial or otherwise) of Seller
[and Initial Servicer];
(ii) Seller [and Initial Servicer] is not required to obtain the
consent of any other person or any consent, license, approval or
authorization from, or registration or declaration with, any
governmental authority, bureau or agency in
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connection with the execution, delivery, performance, validity or
enforceability of this Agreement;
(iii) the execution, delivery and performance of this Agreement by
Seller [and Initial Servicer] will not violate any provision of any
existing law or regulation or any order decree of any court applicable
to Seller [and Initial Servicer] or any provision of the charter or
bylaws of Seller [and Initial Servicer], or constitute a material
breach of any mortgage, indenture, contract or other agreement to
which Seller [and Initial Servicer] is a party or by which it may be
bound;
(iv) (a) no proceeding of or before any court, tribunal or
governmental body is currently pending or, (b) to the knowledge of
Seller [and Initial Servicer], threatened against Seller [and Initial
Servicer] or any of its properties or with respect to this Agreement
or the Offered Certificates, in either case, which would have a
material adverse effect on the business, properties, assets or
condition (financial or otherwise) of Seller [and Initial Servicer];
(v) Seller [and Initial Servicer] has full power and authority to
make, execute, deliver and perform this Agreement and all of the
transactions contemplated hereunder, and has taken all necessary
corporate action to authorize the execution, delivery and performance
of this Agreement. When executed and delivered, this Agreement will
constitute the legal, valid and binding obligation of each of Seller
[and Initial Servicer] enforceable in accordance with its terms,
except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally, by the availability of
equitable remedies, and by limitations of public policy under
applicable securities law as to rights of indemnity and contribution
thereunder; and
(vi) this Agreement has been duly executed and delivered by Seller
[and Initial Servicer].
3. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to Seller [and Initial Servicer], will
be mailed, delivered or telegraphed and confirmed [______________________]; or,
if sent to IXIS, will be mailed, delivered or telegraphed and confirmed to IXIS
Real Estate Capital Inc., 0 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: General Counsel.
4. Miscellaneous. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York without giving effect to
the conflict of laws provisions thereof. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their successors and
assigns and the controlling persons referred to herein, and no other person
shall have any right or obligation hereunder. Neither this Agreement nor any
term hereof may be changed, waived, discharged or terminated orally, but only by
an instrument in writing signed by the party against whom enforcement of the
change, waiver, discharge or termination is sought. This Agreement may be
executed in counterparts, each of which when so executed and delivered shall be
considered an original, and all such counterparts shall constitute
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one and the same instrument. Capitalized terms used but not defined herein shall
have the meanings provided in the P&S.
[Remainder of Page Intentionally Left Blank]
K-6
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective officers hereunto duly authorized, this
__th day of [_____________].
IXIS REAL ESTATE CAPITAL INC.
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
[SELLER]
By:
------------------------------------
Name:
Title:
[INITIAL SERVICER]
By:
------------------------------------
Name:
Title:
EXECUTION COPY
AMENDMENT XX. 0
XXXXXXXXX XX. 0, dated as of May 1, 2006 ("Amendment"), to the First
Amended and Restated Flow Mortgage Loan Purchase and Warranties Agreement, dated
as of January 1, 2006, and as further amended, modified and supplemented from
time to time (the "Purchase Agreement"), between IXIS Real Estate Capital Inc.
(the "Purchaser") and First Bank Mortgage f/k/a First Banc Mortgage, Inc. (the
"Seller").
RECITALS
WHEREAS, the parties hereto have entered into the Purchase Agreement;
WHEREAS, the parties hereto desire to modify the Purchase Agreement as
set forth in this Amendment;
NOW, THEREFORE, in consideration of the premises and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Defined Terms. Unless otherwise defined herein, terms defined in
the Purchase Agreement are used herein as therein defined.
2. Amendments.
(a) Amendment of the Definition of High Cost Loan. Section 1 of the
Purchase Agreement is hereby amended by deleting the definition of "High Cost
Loan" therein in its entirety and replacing it with the following definition:
"High Cost Loan: A Mortgage Loan (a) covered by the Home Ownership and
Equity Protection Act of 1994 ("HOEPA"), (b) with an "annual
percentage rate" or total "points and fees" payable by the related
Mortgagor (as each such term is calculated under HOEPA) that exceed
the thresholds set forth by HOEPA and its implementing regulations,
including 12 C.F.R. Section 226.32(a)(1)(i) and (ii), (c) classified
as a "high cost home," "threshold," "covered," "high risk home,"
"predatory" or similar loan under any other applicable state, federal
or local law (or a similarly classified loan using different
terminology under a law imposing heightened regulatory scrutiny or
additional legal liability for residential mortgage loans having high
interest rates, points and/or fees) or (d) a Mortgage Loan categorized
as High Cost pursuant to Appendix E of Standard & Poor's Glossary. For
avoidance of doubt, the parties agree that this definition shall apply
to any law regardless of whether such law is presently, or in the
future becomes, the subject of judicial review or litigation."
(b) Amendment of Compliance with Applicable Laws Representation.
Subsection 9.02(g) of the Purchase Agreement is hereby amended by deleting the
first sentence thereof in its entirety and replacing it with the following
sentence:
"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, predatory, abusive
and fair lending, equal credit opportunity and disclosure laws
applicable to the Mortgage Loan, including, without limitation, any
provisions relating to prepayment penalties, have been complied with,
the consummation of the transactions contemplated hereby will not
involve the violation of any such laws or regulations, and the Seller
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."
(c) Amendment of Prepayment Penalty Representation. Subsection
9.02(uu) of the Purchase Agreement is hereby amended by deleting it in its
entirety and replacing it with the following:
"Prepayment Penalty.
The Mortgage Loan is subject to a prepayment penalty as provided in
the related Mortgage Note except as set forth on Exhibit B to each
related Assignment and Conveyance Agreement. With respect to each
Mortgage Loan that has a prepayment penalty feature, each such
prepayment penalty is enforceable and will be enforced by the Seller
for the benefit of the Purchaser, and each prepayment penalty is
permitted pursuant to federal, state and local law. Each such
prepayment penalty is in an amount equal to the maximum amount
permitted under applicable law and no such prepayment penalty may
provide for a term in excess of five (5) years with respect to
Mortgage Loans originated prior to October, 1, 2002. With respect to
Mortgage Loans originated on or after October 1, 2002, the duration of
the prepayment period shall not exceed three (3) years from the date
of the Mortgage Note unless the Mortgage Loan was modified to reduce
the prepayment period to no more than three (3) years from the date of
such Mortgage Note and the Mortgagor was notified in writing of such
reduction in prepayment period. With respect to any Mortgage Loan that
contains a provision permitting imposition of a prepayment penalty
upon a prepayment prior to maturity: (i) the Mortgage Loan provides
some benefit to the Mortgagor (e.g., a rate or fee reduction) in
exchange for accepting such prepayment penalty, (ii) the Mortgage
Loan's originator had a written policy of offering the Mortgagor or
requiring third-party brokers to offer the Mortgagor, the option of
obtaining a mortgage loan that did not require payment of such a
penalty and (iii) the prepayment penalty was adequately disclosed to
the Mortgagor in the loan documents pursuant to applicable state,
local and federal law. This representation is a Deemed Material Breach
Representation;"
2
(d) Amendment of Single Premium Credit Life Insurance Policy
Representation. Subsection 9.02(zz) of the Purchase Agreement is hereby amended
by deleting it in its entirety and replacing it with the following:
"Single Premium Credit Life Insurance Policy. No Mortgagor was
required to purchase any single-premium credit insurance policy (e.g., life,
disability, accident, unemployment or property insurance policy) or debt
cancellation agreement as a condition of obtaining the extension of credit. No
Mortgagor obtained a prepaid single-premium credit insurance policy (e.g., life,
disability, accident, unemployment or property insurance policy) in connection
with the origination of the Mortgage Loan. No proceeds from any Mortgage Loan
were used to purchase single premium credit insurance policies or debt
cancellation agreements as part of the origination of, or as a condition to
closing, such Mortgage Loan. This representation is a Deemed Material Breach
Representation;"
(e) Amendment of Origination Practices/No Steering Representation.
Subsection 9.02(ppp) of the Purchase Agreement is hereby amended by deleting it
in its entirety and replacing it with the following:
"Origination Practices/No Steering.
The Mortgagor was not encouraged or required to select a Mortgage Loan
product offered by the Mortgage Loan's originator which is a higher
cost product designed for less creditworthy borrowers, unless at the
time of the Mortgage Loan's origination, such Mortgagor did not
qualify taking into account such facts as, without limitation, the
Mortgage Loan's requirements and the Mortgagor's credit history,
income, assets and liabilities and debt-to-income ratios for a
lower-cost credit product then offered by the Mortgage Loan's
originator or any affiliate of the Mortgage Loan's originator. For a
Mortgagor who seeks financing through a Mortgage Loan originator's
higher-priced subprime lending channel, the Mortgagor was directed
towards or offered the Mortgage Loan originator's standard mortgage
line if the Mortgagor was able to qualify for one of the standard
products. This representation is a Deemed Material Breach
Representation;"
(f) Amendment of Underwriting Methodology Representation. Subsection
9.02(qqq) of the Purchase Agreement is hereby amended by deleting it in its
entirety and replacing it with the following:
"Underwriting Methodology.
The methodology used in underwriting the extension of credit for each
Mortgage Loan does not rely on the extent of the Mortgagor's equity in
the collateral as the principal determining factor in approving such
extension of credit. The methodology employed objective criteria that
related such facts as, without limitation, the Mortgagor's credit
history, income, assets or liabilities, to the proposed mortgage
payment and, based on such methodology, the Mortgage Loan's originator
made a reasonable determination that at the time of origination
3
the Mortgagor had the ability to make timely payments on the Mortgage
Loan. Such underwriting methodology confirmed that at the time of
origination (application/approval) the Mortgagor had a reasonable
ability to make timely payments on the Mortgage Loan. This
representation is a Deemed Material Breach Representation;"
(g) Amendment of Second Lien Mortgage Loans. Subsection 9.02(ttt) of
the Purchase Agreement is hereby amended by deleting clause (5) in its
entirety and replacing it with the following:
(5) the related Mortgaged Property is the Mortgagor's principal
residence.
3. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY NEW YORK LAW
WITHOUT REFERENCE TO CHOICE OF LAW DOCTRINE.
[SIGNATURE PAGES FOLLOW]
4
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed and delivered as of the day and year first above written.
SELLER:
FIRST BANK MORTGAGE
By:
------------------------------------
Name:
Title:
PURCHASER:
IXIS REAL ESTATE CAPITAL INC.
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
EXHIBIT BB
FIRST HORIZON AGREEMENTS
BB-1
EXECUTION COPY
ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated January 30, 2007
("Agreement"), among IXIS Real Estate Capital Inc. ("Assignor"), Xxxxxx Xxxxxxx
ABS Capital I Inc. ("Assignee") and First Horizon Home Loan Corporation (the
"Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns
to the Assignee all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain Second Amended
and Restated Mortgage Loan Purchase and Warranties Agreement (the "Purchase
Agreement"), dated as of July 1, 2006, between the Assignor, as purchaser (the
"Purchaser"), and the Company, as seller, solely insofar as the Purchase
Agreement relates to the Mortgage Loans.
The Assignor specifically reserves and does not assign to the Assignee
hereunder (i) any and all right, title and interest in, to and under and any
obligations of the Assignor with respect to any mortgage loans subject to the
Purchase Agreement which are not the Mortgage Loans set forth on the Mortgage
Loan Schedule and are not the subject of this Agreement or (ii) the rights of
the Purchaser (a) under Subsection 9.04 of the Purchase Agreement or (b) to any
premium recapture (i.e., the excess, if any, of the purchase price percentage
over par) in connection with any repurchase pursuant to Subsections 9.03 and
9.05 of the Purchase Agreement.
Recognition of the Company
2. From and after the date hereof (the "Securitization Closing Date"),
the Company shall and does hereby recognize that the Assignee will transfer the
Mortgage Loans and assign its rights under the Purchase Agreement (solely to the
extent set forth herein) and this Agreement to IXIS Real Estate Capital Trust
2007-HE1 (the "Trust") created pursuant to a Pooling and Servicing Agreement,
dated as of January 1, 2007 (the "Pooling Agreement"), among the Assignee, the
Assignor, Deutsche Bank National Trust Company, as trustee (in such capacity,
including its successors in interest and any successor trustees under the
Pooling Agreement, the "Trustee"), Xxxxx Fargo Bank, National Association, as
securities administrator (in such capacity, including its successors in interest
and any successor securities administrators under the Pooling Agreement, the
"Securities Administrator"), master servicer (in such capacity, including its
successors in interest and any successor master servicers under the Pooling
Agreement, the "Master Servicer") and Saxon Mortgage Services, Inc., as servicer
(including its successors in interest and any successor servicer under the
Pooling Agreement, the "Servicer"). The Company hereby acknowledges and agrees
that from and after the date hereof (i) the Trust will be the owner of the
Mortgage Loans, (ii) the Company shall look solely to the Trust for
performance of any obligations of the Assignor insofar as they relate to the
Mortgage Loans, (iii) the Trust (including the Trustee, Securities
Administrator, Master Servicer and the Servicer acting on the Trust's behalf)
shall have all the rights and remedies available to the Assignor, insofar as
they relate to the Mortgage Loans, under the Purchase Agreement, including,
without limitation, the enforcement of the document delivery requirements set
forth in Section 6 of the Purchase Agreement, and shall be entitled to enforce
all of the obligations of the Company thereunder insofar as they relate to the
Mortgage Loans, and (iv) all references to the Purchaser, the Custodian or the
Bailee under the Purchase Agreement insofar as they relate to the Mortgage
Loans, shall be deemed to refer to the Trust (including the Trustee, Securities
Administrator, Master Servicer and the Servicer acting on the Trust's behalf).
Neither the Company nor the Assignor shall amend or agree to amend, modify,
waiver, or otherwise alter any of the terms or provisions of the Purchase
Agreement which amendment, modification, waiver or other alteration would in any
way affect the Mortgage Loans or the Company's performance under the Purchase
Agreement with respect to the Mortgage Loans without the prior written consent
of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee
and the Trust (including the Trustee, Securities Administrator, Master Servicer
and the Servicer acting on the Trust's behalf) as of the date hereof that:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver
and perform its obligations under this Agreement and has full power and
authority to perform its obligations under the Purchase Agreement. The
execution by the Company of this Agreement is in the ordinary course of the
Company's business and will not conflict with, or result in a breach of,
any of the terms, conditions or provisions of the Company's charter or
bylaws or any legal restriction, or any material agreement or instrument to
which the Company is now a party or by which it is bound, or result in the
violation of any law, rule, regulation, order, judgment or decree to which
the Company or its property is subject. The execution, delivery and
performance by the Company of this Agreement have been duly authorized by
all necessary corporate action on part of the Company. This Agreement has
been duly executed and delivered by the Company, and, upon the due
authorization, execution and delivery by the Assignor and the Assignee,
will constitute the valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization, insolvency,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and by general principles of equity regardless
of whether enforceability is considered in a proceeding in equity or at
law;
(c) No consent, approval, order or authorization of, or
declaration, filing or registration with, any governmental entity is
required to be obtained or made by the Company in connection with the
execution, delivery or performance by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation pending
or threatened against the Company, before any court, administrative agency
or other tribunal, which would draw into question the validity of this
Agreement or the Purchase Agreement, or which, either in any one instance
or in the aggregate, would result in any material adverse change in the
ability of the Company to perform its obligations under this Agreement or
the Purchase Agreement, and the Company is solvent.
4. Pursuant to Section 13 of the Purchase Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust (including the Trustee, Securities Administrator, Master Servicer
and the Servicer acting on the Trust's behalf), that the representations and
warranties set forth in Section 9.02 of the Purchase Agreement are true and
correct as of the date hereof (or, with respect to the Servicing Transfer
Representations, the Transfer Date) as if such representations and warranties
were made on the date hereof unless otherwise specifically stated in such
representations and warranties.
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf) in connection with any breach of the representations and warranties made
by the Company set forth in Sections 3 and 4 hereof shall be as set forth in
Subsection 9.03 of the Purchase Agreement as if they were set forth herein
(including without limitation the repurchase and indemnity obligations set forth
therein); provided, however, that the Assignor specifically reserves and does
not assign to the Assignee hereunder any and all right, title and interest in
the Premium Percentage, if any, due in connection with the repurchase of a
Mortgage Loan pursuant to Subsections 9.03, 9.04 and 9.05.
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced, with the prior
written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors and
assigns of the parties hereto and (ii) the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf). Any entity into which Assignor, Assignee or Company may be merged or
consolidated shall, without the requirement for any further writing, be deemed
Assignor, Assignee or Company, respectively, hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive the
conveyance of the Mortgage Loans and the assignment of the Purchase Agreement
(to the extent assigned hereunder) by Assignor to Assignee and by Assignee to
the Trust and nothing contained herein shall supersede or amend the terms of the
Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
FIRST HORIZON
HOME LOAN CORPORATION
By: /s/ Xxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxx X. Xxxxx
Its: Dir. V.P.
IXIS REAL ESTATE CAPITAL INC.
By: /s/ F. Xxxx Xxxxxx
------------------------------------
Name: F. Xxxx Xxxxxx
Its: Managing Director
By: /s/ Xxxxxxxxxxx Xxxxxx
------------------------------------
Name: Xxxxxxxxxxx Xxxxxx
Its: Managing Director
XXXXXX XXXXXXX ABS CAPITAL I INC.
By: /s/ Xxxxxxx Xxx
----------------------------------------
Name: Xxxxxxx Xxx
Its: Vice President
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
MORTGAGE LOAN SCHEDULE
A-1
EXECUTION COPY
================================================================================
SECOND AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT
----------
IXIS REAL ESTATE CAPITAL INC.,
Purchaser
FIRST HORIZON HOME LOAN CORPORATION,
Seller
----------
Dated as of July 1, 2006
Adjustable-Rate and Fixed-Rate, B/C Residential Mortgage Loans
================================================================================
TABLE OF CONTENTS
Page
----
SECTION 1. DEFINITIONS.................................................................... 1
SECTION 2. AGREEMENT TO PURCHASE.......................................................... 13
SECTION 3. MORTGAGE SCHEDULES............................................................. 14
SECTION 4. PURCHASE PRICE................................................................. 14
SECTION 5. EXAMINATION OF MORTGAGE FILES.................................................. 15
SECTION 6. CONVEYANCE FROM SELLER TO PURCHASER............................................ 15
Subsection 6.01 Conveyance of Mortgage Loans; Possession of Servicing Files............ 15
Subsection 6.02 Books and Records...................................................... 15
Subsection 6.03 Delivery of Mortgage Loan Documents.................................... 16
Subsection 6.04 Quality Control Procedures............................................. 17
Subsection 6.05 MERS Designated Mortgage Loans......................................... 17
SECTION 7. SERVICING OF THE MORTGAGE LOANS................................................ 18
SECTION 8. TRANSFER OF SERVICING.......................................................... 18
SECTION 9. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SELLER; REMEDIES FOR BREACH... 21
Subsection 9.01 Representations and Warranties Regarding the Seller.................... 21
Subsection 9.02 Representations and Warranties Regarding Individual Mortgage Loans..... 24
Subsection 9.03 Remedies for Breach of Representations and Warranties.................. 40
Subsection 9.04 Repurchase of Mortgage Loans That Prepay in Full....................... 42
Subsection 9.05 Repurchase of Mortgage Loans with First Payment Defaults............... 43
Subsection 9.06 [Reserved]............................................................. 43
SECTION 10. CLOSING........................................................................ 43
SECTION 11. CLOSING DOCUMENTS.............................................................. 44
SECTION 12. COSTS.......................................................................... 46
SECTION 13. COOPERATION OF SELLER WITH A RECONSTITUTION.................................... 46
SECTION 14. THE SELLER..................................................................... 48
Subsection 14.01 Additional Indemnification by the Seller; Third Party Claims........... 48
Subsection 14.02 Merger or Consolidation of the Seller.................................. 49
SECTION 15. FINANCIAL STATEMENTS........................................................... 49
SECTION 16. MANDATORY DELIVERY; GRANT OF SECURITY INTEREST................................. 50
SECTION 17. NOTICES........................................................................ 50
SECTION 18. SEVERABILITY CLAUSE............................................................ 51
SECTION 19. COUNTERPARTS................................................................... 51
SECTION 20. GOVERNING LAW JURISDICTION; CONSENT TO SERVICE OF PROCESS...................... 52
SECTION 21. INTENTION OF THE PARTIES....................................................... 52
SECTION 22. SUCCESSORS AND ASSIGNS; ASSIGNMENT OF PURCHASE AGREEMENT....................... 52
SECTION 23. WAIVERS........................................................................ 53
SECTION 24. EXHIBITS....................................................................... 53
SECTION 25. GENERAL INTERPRETIVE PRINCIPLES................................................ 53
SECTION 26. REPRODUCTION OF DOCUMENTS...................................................... 54
SECTION 27. FURTHER AGREEMENTS............................................................. 54
SECTION 28. RECORDATION OF ASSIGNMENTS OF MORTGAGE......................................... 54
SECTION 29. NO SOLICITATION................................................................ 54
SECTION 30. WAIVER OF TRIAL BY JURY........................................................ 55
SECTION 31. COMPLIANCE WITH REGULATION AB.................................................. 55
Subsection 31.01 Intent of the Parties; Reasonableness.................................. 55
Subsection 31.02 Additional Representations and Warranties of the Seller................ 55
Subsection 31.03 Information To Be Provided by the Seller............................... 56
Subsection 31.04 Indemnification; Remedies.............................................. 59
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EXHIBITS
EXHIBIT A CONTENTS OF EACH MORTGAGE FILE
EXHIBIT B FORM OF INTERIM SERVICING AGREEMENT
EXHIBIT C FORM OF SELLER'S OFFICER'S CERTIFICATE
EXHIBIT D FORM OF OPINION OF COUNSEL TO THE SELLER AND THE INTERIM SERVICER
EXHIBIT E FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT F FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT G LIST OF PROHIBITED STATES
EXHIBIT H FORM OF ASSIGNMENT AND CONVEYANCE AGREEMENT
EXHIBIT I SELLER'S UNDERWRITING GUIDELINES
EXHIBIT J FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
EXHIBIT K FORM OF INDEMNIFICATION AND CONTRIBUTION AGREEMENT
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SECOND AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND WARRANTIES AGREEMENT
This SECOND AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND WARRANTIES
AGREEMENT (the "Agreement"), dated as of July 1, 2006, by and between IXIS Real
Estate Capital Inc., a New York corporation, having an office at 0 Xxxx 00xx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Purchaser"), and First
Horizon Home Loan Corporation, a Kansas corporation, having an office at 0000
Xxxxxxx Xxxxxxxxx, Xxxxxxxx Xxxx, Xxxxxx 00000 (the "Seller").
WITNESSETH:
WHEREAS, the Purchaser and the Seller are parties to that certain
Amended and Restated Mortgage Loan Purchase and Warranties Agreement, dated as
of October 1, 2005 (the "Original Purchase Agreement"), pursuant to which the
Seller desires to sell, from time to time, to the Purchaser, and the Purchaser
desires to purchase, from time to time, from the Seller, certain first and
second lien, adjustable-rate and fixed-rate B/C residential mortgage loans (the
"Mortgage Loans") on a servicing released basis as described herein, and which
shall be delivered in pools of whole loans (each, a "Mortgage Loan Package") on
various dates as provided herein (each, a "Closing Date");
WHEREAS, at the present time, the Purchaser and the Seller desire to
amend and restate the Original Purchase Agreement to make certain modifications
as set forth herein and upon the execution and delivery of this Agreement by the
Purchaser and the Seller this Agreement shall supercede the Original Purchase
Agreement and supplant the Original Purchase Agreement.
NOW, THEREFORE, in consideration of the premises and mutual agreements
set forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Purchaser and the Seller agree
as follows:
SECTION 1. Definitions.
For purposes of this Agreement the following capitalized terms shall
have the respective meanings set forth below.
Accepted Servicing Practices: With respect to any Mortgage Loan, those
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 and incorporating
the Delinquency Collection Policies and Procedures.
Act: The National Housing Act, as amended from time to time.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan
purchased pursuant to this Agreement.
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agency Transfer: A Xxxxxx Xxx Transfer or a Xxxxxxx Mac Transfer.
Agreement: This Mortgage Loan Purchase and Warranties Agreement and
all amendments hereof and supplements hereto.
ALTA: The American Land Title Association and its successors in
interest.
Appraised Value: (i) With respect to any First Lien Loan, the value of
the related Mortgaged Property based upon the appraisal made, if any, for the
originator at the time of origination of the Mortgage Loan or the sales price of
the Mortgaged Property at such time of origination, whichever is less; provided,
however, that in the case of a refinanced Mortgage Loan, such value is based
solely upon the appraisal made, if any, at the time of origination of such
refinanced Mortgage Loan, and (ii) with respect to any Second Lien Loan, the
value, determined pursuant to the Seller's Underwriting Guidelines, of the
related Mortgaged Property as of the origination of the Second Lien Loan.
Assignment and Conveyance Agreement: As defined in Subsection 6.01.
Assignment of Mortgage: 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.
Balloon Mortgage Loan: Any Mortgage Loan that requires only payments
of interest until the stated maturity date of the Mortgage Loan or the Monthly
Payments of principal which (not including the payment due on its stated
maturity date) are based on an amortization schedule that would be insufficient
to fully amortize the principal thereof by stated maturity date of the Mortgage
Loan.
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 State of New York
or the state in which the Interim Servicer's servicing operations are located,
are authorized or obligated by law or executive order to be closed.
Closing Date: The date or dates on which the Purchaser from time to
time shall purchase and the Seller from time to time shall sell the Mortgage
Loans listed on the related Mortgage Loan Schedule with respect to the related
Mortgage Loan Package.
CLTV: As of any date and as to (1) any Second Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the Second Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are senior or equal in
priority to the Second Lien Loan and which are secured by the same
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Mortgaged Property to (b) the Appraised Value and (2) any First Lien Loan, the
ratio, expressed as a percentage, of the (a) sum of (i) the outstanding
principal balance of the First Lien Loan and (ii) the outstanding principal
balance as of such date of any mortgage loan or mortgage loans that are junior
or equal in priority to the First Lien Loan and which are secured by the same
Mortgaged Property to (b) the Appraised Value.
Code: Internal Revenue Code of 1986, as amended.
Commission: The United States Securities and Exchange Commission.
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.
Convertible Mortgage Loan: Any individual Adjustable Rate Mortgage
Loan purchased pursuant to this Agreement which contains a provision whereby the
Mortgagor is permitted to convert the Adjustable Rate Mortgage Loan to a Fixed
Rate Mortgage Loan in accordance with the terms of the related Mortgage Note.
Covered Loan: A Mortgage Loan categorized as Covered pursuant to
Appendix E of Standard & Poor's Glossary.
Credit Files: As defined in Section 5 herein.
Custodial Account: The separate account or accounts created and
maintained pursuant to Section 2.04 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Custodial Agreement: The agreement governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other
Mortgage Loan Documents, to be executed between the Purchaser and the Custodian
and to be dated as of the related Cut-Off Date.
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 therein provided. If at any time there is no Custodial
Agreement in effect with respect to a Mortgage Loan, all references to the
Custodian herein and in the Interim Servicing Agreement shall be deemed to refer
to the Purchaser (or its designee) with respect to such Mortgage Loan.
Cut-off Date: The date or dates designated as such on the related
Mortgage Loan Schedule with respect to the related Mortgage Loan Package.
Deemed Material Breach Representation: Each representation identified
as such in Subsection 9.02.
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Deleted Mortgage Loan: A Mortgage Loan that is repurchased or replaced
or to be replaced with a Qualified Substitute Mortgage Loan by the Seller in
accordance with the terms of this Agreement.
Delinquency Collection Policies and Procedures: The delinquency
collection policies and procedures of the Seller, a copy of which is attached to
the Interim Servicing Agreement.
Depositor: The depositor, as such term is defined in Regulation AB,
with respect to any Securitization Transaction.
Determination Date: The date specified in the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
Due Date: The day of the month on which the Monthly Payment is due on
a Mortgage Loan, exclusive of any days of grace.
Eligible Account: Any of (i) an account maintained with a federal or
state chartered depository institution or trust company the short-term unsecured
debt obligations of which (or, in the case of a depository institution or trust
company 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 or
Prime-1 by Moody's (or a comparable rating if another Rating Agency is specified
by the Purchaser by written notice to the Seller) at the time any amounts are
held on deposit therein, (ii) an account or accounts the deposits in which are
fully insured by the FDIC, or (iii) a trust account or accounts maintained with
a federal or state chartered depository institution or trust company acting in
its fiduciary capacity.
Escrow Account: The separate account or accounts created and
maintained pursuant to Section 2.06 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
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 document.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Xxxxxx Mae: The Federal National Mortgage Association and its
successors in interest.
Xxxxxx Xxx Guides: The Xxxxxx Xxx Xxxxxxx' Guide and the Xxxxxx Xxx
Servicers' Guide and all amendments or additions thereto.
Xxxxxx Mae Transfer: As defined in Section 13 hereof.
FDIC: The Federal Deposit Insurance Corporation and its successors in
interest.
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FHA: The Federal Housing Administration, an agency within the United
States Department of Housing and Urban Development and its successors in
interest and including the Federal Housing Commissioner and the Secretary of
Housing and Urban Development where appropriate under the FHA Regulations.
First Lien Loan: Any Mortgage Loan secured by a first lien Mortgage on
the related Mortgaged Property.
Fitch: Fitch, Inc. and its successors in interest.
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 in interest.
Xxxxxxx Mac Transfer: As defined in Section 13 hereof.
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 (a) covered by the Home Ownership and
Equity Protection Act of 1994 ("HOEPA"), (b) with an "annual percentage rate" or
total "points and fees" payable by the related Mortgagor (as each such term is
calculated under HOEPA) that exceed the thresholds set forth by HOEPA and its
implementing regulations, including 12 C.F.R. Section 226.32(a)(1)(i) and (ii),
(c) classified as a "high cost home," "threshold," "covered," "high risk home,"
"predatory" or similar loan under any other applicable state, federal or local
law (or a similarly classified loan using different terminology under a law
imposing heightened regulatory scrutiny or additional legal liability for
residential mortgage loans having high interest rates, points and/or fees) or
(d) a Mortgage Loan categorized as High Cost pursuant to Appendix E of Standard
& Poor's Glossary. For avoidance of doubt, the parties agree that this
definition shall apply to any applicable law regardless of whether such law is
presently, or in the future becomes, the subject of judicial review or
litigation.
Home Loan: A Mortgage Loan categorized as Home Loan pursuant to
Appendix E of Standard & Poor's Glossary.
HUD: The Department of Housing and Urban Development, or any federal
agency or official thereof which may from time to time succeed to the functions
thereof with regard to FHA Mortgage Insurance. The term "HUD," for purposes of
this Agreement, is also deemed to include subdivisions thereof such as the FHA
and Government National Mortgage Association.
Index: With respect to each Adjustable Rate Mortgage Loan, a rate per
annum set forth on Exhibit B to each related Assignment and Conveyance
Agreement.
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Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
Interest Rate Adjustment Date: With respect to each Adjustable Rate
Mortgage Loan, the date, specified in the related Mortgage Note and the Mortgage
Loan Schedule, on which the Mortgage Interest Rate is adjusted.
Interim Funder: With respect to each MERS Designated Mortgage Loan,
the Person named on the MERS(R) System as the interim funder pursuant to the
MERS Procedures Manual.
Interim Servicer: First Horizon Home Loan Corporation, a Kansas
corporation, and its successors in interest, and any successor interim servicer
under the Interim Servicing Agreement.
Interim Servicing Agreement: The agreement, attached as Exhibit B
hereto, to be entered into by the Purchaser and the Interim Servicer, providing
for the Interim Servicer to service the Mortgage Loans for an interim period as
specified by the Interim Servicing Agreement.
Investor: With respect to each MERS Designated Mortgage Loan, the
Person named on the MERS(R) System as the investor pursuant to the MERS
Procedures Manual.
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 related Mortgage Loan Schedule.
Liquidation Proceeds: Cash 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 or otherwise, or the sale of the
related Mortgaged Property if the Mortgaged Property is acquired in satisfaction
of the Mortgage Loan.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan, the
ratio (expressed as a percentage) of the outstanding principal amount of the
Mortgage Loan as of the Cut-off Date (unless otherwise indicated), to the
Appraised Value of the Mortgaged Property.
MERS: Mortgage Electronic Registration Systems, Inc., a Delaware
corporation, and its successors and assigns.
MERS Designated Mortgage Loan: Mortgage Loans for which (a) the Seller
has designated or will designate MERS as, and has taken or will take such action
as is necessary to cause MERS to be, the mortgagee of record, as nominee for the
Seller, in accordance with MERS Procedure Manual and (b) the Seller has
designated or will designate the Purchaser as the Investor on the MERS(R)
System.
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MERS Procedure Manual: The MERS Procedures Manual, as it may be
amended, supplemented or otherwise modified from time to time.
MERS Report: The report from the MERS System listing MERS Designated
Mortgage Loans and other information.
MERS(R) System: MERS mortgage electronic registry system, as more
particularly described in the MERS Procedures Manual.
Monthly Payment: The scheduled monthly payment of principal and
interest on a Mortgage Loan.
Moody's: Xxxxx'x Investors Service, Inc. and its successors in
interest.
Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note, which creates a first lien, in the case of a First Lien Loan, or
a second lien, in the case of a Second Lien Loan, on the Mortgaged Property.
Mortgage File: The items pertaining to a particular Mortgage Loan
referred to in Exhibit A 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 with respect to each Mortgage Loan.
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 applicable Mortgage Loan Schedule, which Mortgage Loan
includes without limitation the Mortgage File, the Monthly Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
Servicing Rights, and all other rights, benefits, proceeds and obligations
arising from or in connection with such Mortgage Loan, excluding replaced or
repurchased mortgage loans.
Mortgage Loan Documents: The documents required to be delivered to the
Custodian pursuant to Section 6.03 hereof with respect to any Mortgage Loan.
Mortgage Loan Package: Each pool of Mortgage Loans, which shall be
purchased by the Purchaser from the Seller from time to time on each Closing
Date.
Mortgage Loan Schedule: The schedule of Mortgage Loans forwarded in an
electronic format setting forth the following information with respect to each
Mortgage Loan in the related Mortgage Loan Package: (1) the Seller's Mortgage
Loan identifying number; (2) the Mortgagor's name; (3) the street address of the
Mortgaged Property including the city, state and zip code; (4) a code indicating
whether the Mortgaged Property is owner-occupied, a second home or investment
property; (5) the number and type of residential units constituting the
Mortgaged Property (i.e., a single family residence, a 2-4 family residence, a
unit in a condominium project or a unit in a planned unit development,
manufactured housing); (6) the Mortgage Loan origination date; (7) the original
months to maturity or the remaining months to
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maturity from the related Cut-off Date, in any case based on the original
amortization schedule and, if different, the maturity expressed in the same
manner but based on the actual amortization schedule; (8) the Loan-to-Value
Ratio at origination; (9) with respect to First Lien Loans, the LTV and with
respect to Second Lien Loans, the CLTV; (10) the Mortgage Interest Rate as of
the related Cut-off Date; (11) the date on which the Monthly Payment was due on
the Mortgage Loan and, if such date is not consistent with the Due Date
currently in effect, such Due Date; (12) the stated maturity date; (13) the
amount of the Monthly Payment as of the related Cut-off Date; (14) the last
payment date as of which a payment was actually applied to the outstanding
principal balance; (15) the original principal amount of the Mortgage Loan; (16)
the principal balance of the Mortgage Loan as of the close of business on the
related Cut-off Date, after deduction of payments of principal due and collected
on or before the Cut-off Date; (17) the Interest Rate Adjustment Date; (18) the
Gross Margin; (19) the Lifetime Rate Cap under the terms of the Mortgage Note;
(20) a code indicating the type of Index; (21) the Mortgage Interest Rate as of
origination; (22) the type of Mortgage Loan (i.e., fixed-rate, adjustable-rate,
First Lien, Second Lien); (23) a code indicating the purpose of the loan (i.e.,
purchase, rate and term refinance, equity take-out refinance); (24) a code
indicating the documentation style (i.e., full or stated income); (25) the loan
credit classification (as described in the Underwriting Guidelines); (26) the
applicable Cut-off Date; (27) the applicable Closing Date; (28) a code
indicating whether the Mortgage Loan is a Home Loan; (29) the credit risk score
(FICO score); (30) with respect to the related Mortgagor, the debt-to-income
ratio; (31) with respect to Second Lien Loans, the outstanding principal balance
of the superior lien; (32) the Appraised Value of the Mortgaged Property; (33)
the sale price of the Mortgaged Property if the Mortgage Loan was originated in
connection with the purchase of the Mortgaged Property; (34) the Periodic Rate
Cap under the terms of the Mortgage Note; (35) the Periodic Rate Floor under the
terms of the Mortgage Note; (36) whether such Mortgage Loan provides for a
prepayment penalty; (37) the prepayment penalty period of such Mortgage Loan, if
applicable; (38) a description of the type of prepayment penalty, if applicable;
(39) the MERS Identification Number; (40) whether the Mortgagor represented that
the Mortgagor would occupy the Mortgaged Property as its primary residence and
(41) a code indicating if the Mortgage Loan is a Balloon Mortgage Loan. With
respect to the Mortgage Loans in the aggregate, the Mortgage Loan Schedule shall
set forth the following information, as of the related Cut-off Date: (1) the
number of Mortgage Loans; (2) the current aggregate outstanding principal
balance of the Mortgage Loans; (3) the weighted average Mortgage Interest Rate
of the Mortgage Loans; and (4) the weighted average maturity of the Mortgage
Loans.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
Mortgaged Property: With respect to each Mortgage Loan, the
Mortgagor's real property securing repayment of a related Mortgage Note,
consisting of an unsubordinated estate in fee simple or, with respect to real
property located in jurisdictions in which the use of leasehold estates for
residential properties is a widely-accepted practice, a leasehold estate, in a
single parcel or multiple parcels of real property improved by a residential
dwelling as further described in this Agreement.
Mortgagor: The obligor on a Mortgage Note.
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OCC: Office of the Comptroller of the Currency and its successors in
interest.
Officer's Certificate: A certificate signed by the Chairman of the
Board or the Vice Chairman of the Board or a President or a Vice President and
by the Treasurer or the Secretary or one of the Assistant Treasurers or
Assistant Secretaries of the Seller, and delivered to the Purchaser as required
by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel
for the Seller, reasonably acceptable to the Purchaser, provided that any
Opinion of Counsel relating to (a) the qualification of any account required to
be maintained pursuant to this Agreement as an Eligible Account, (b)
qualification of the Mortgage Loans in a REMIC or (c) compliance with the REMIC
Provisions, must be (unless otherwise stated in such Opinion of Counsel) an
opinion of counsel who (i) is in fact independent of the Seller and any servicer
of the Mortgage Loans, (ii) does not have any material direct or indirect
financial interest in the Seller or any servicer of the Mortgage Loans or in an
Affiliate of either and (iii) is not connected with the Seller or any servicer
of the Mortgage Loans as an officer, employee, director or person performing
similar functions.
OTS: Office of Thrift Supervision and its successors in interest.
Periodic Rate Cap: 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 increase on an Interest
Rate Adjustment Date above the Mortgage Interest Rate previously in effect.
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.
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.
Preliminary Mortgage Schedule: As defined in Section 3.
Premium Percentage: With respect to any Mortgage Loan, a percentage
equal to the excess of the Purchase Price Percentage over 100%.
Principal Prepayment: Any payment or other recovery of principal on a
Mortgage Loan 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.
Purchase Price: The price paid on the related Closing Date by the
Purchaser to the Seller in exchange for the Mortgage Loans purchased on such
Closing Date as calculated in Section 4 of this Agreement.
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Purchase Price and Terms Agreement: Those certain agreements setting
forth the general terms and conditions of the transaction consummated herein and
identifying the Mortgage Loans to be purchased from time to time hereunder, by
and among the Seller, the Purchaser and the Interim Servicer (if applicable).
All of the individual Purchase Price and Terms Agreements shall collectively be
referred to as the "Purchase Price and Terms Agreement."
Purchase Price Percentage: With respect to any Mortgage Loan, an
amount equal to the percentage of par as stated in the Purchase Price and Terms
Agreement (subject to adjustment as provided therein) related to such Mortgage
Loan.
Purchaser: IXIS Real Estate Capital Inc., a New York corporation, and
its successors in interest and assigns, or any successor to the Purchaser under
this Agreement as herein provided.
Qualified Correspondent: Any Person from which the Seller purchased
Mortgage Loans, provided that the following conditions are satisfied: (i) such
Mortgage Loans were originated pursuant to an agreement between the Seller and
such Person that contemplated that such Person would underwrite mortgage loans
from time to time, for sale to the Seller, in accordance with underwriting
guidelines designated by the Seller ("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 Seller within one hundred eighty (180) days after origination; (iii) either
(x) the Designated Guidelines were, at the time such Mortgage Loans were
originated, used by the Seller in origination of mortgage loans of the same type
as the Mortgage Loans for the Seller's own account or (y) the Designated
Guidelines were, at the time such Mortgage Loans were underwritten, designated
by the Seller on a consistent basis for use by lenders in originating mortgage
loans to be purchased by the Seller; and (iv) the Seller employed, at the time
such Mortgage Loans were acquired by the Seller, pre purchase or post purchase
quality assurance procedures (which may involve, among other things, review of a
sample of 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
Seller.
Qualified Substitute Mortgage Loan: A mortgage loan eligible to be
substituted by the Seller for a Deleted Mortgage Loan which must, on the date of
such substitution, (i) have an outstanding principal balance, after deduction of
all scheduled payments due in the month of substitution (or in the case of a
substitution of more than one mortgage loan for a Deleted Mortgage Loan, an
aggregate principal balance), not in excess of the outstanding principal balance
of the Deleted Mortgage Loan (the amount of any shortfall will be deposited in
the Custodial Account by the Seller in the month of substitution); (ii) have a
Mortgage Interest Rate not less than and not more than 1% greater than the
Mortgage Interest Rate of the Deleted Mortgage Loan; (iii) have a remaining term
to maturity not greater than and not more than one (1) year less than that of
the Deleted Mortgage Loan; (iv) be of the same type as the Deleted Mortgage Loan
(i.e., fixed-rate, adjustable-rate with same Periodic Rate Cap, Index and lien
priority); and (v) comply with each representation and warranty (respecting
individual Mortgage Loans) set forth in Section 9 hereof.
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Rating Agency: Any of Fitch, Xxxxx'x or Standard & Poor's, or their
respective successors designated by the Purchaser.
Reconstitution: Any Securitization Transaction or Whole Loan Transfer.
Reconstitution Agreements: The agreement or agreements entered into by
the Seller and/or the Interim Servicer and the Purchaser and/or certain third
parties on the Reconstitution Date or Dates with respect to any or all of the
Mortgage Loans sold hereunder, in connection with a Whole Loan Transfer, Agency
Transfer or a Securitization Transaction pursuant to Section 13, including, but
not limited to, a seller's warranties and servicing agreement with respect to a
Whole Loan Transfer, and a trust and servicing agreement, pooling and servicing
agreement and/or seller/servicer agreements and related custodial/trust
agreement and documents with respect to a Securitization Transaction.
Reconstitution Date: As defined in Section 13.
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. Sections 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 Date: The date specified in the Interim Servicing Agreement
(with respect to each Mortgage Loan, for an interim period, as specified
therein).
Repurchase Price: With respect to any Mortgage Loan for which a breach
of a representation or warranty from the Agreement or the Interim Servicing
Agreement is found, a price equal to the then outstanding principal balance of
the Mortgage Loan to be repurchased, plus accrued interest thereon at the
Mortgage Interest Rate from the date to which interest had last been paid
through the date of such repurchase, plus the amount of any outstanding advances
owed to any servicer, and plus all out of pocket costs and expenses incurred by
the Purchaser or any servicer arising out of or based upon such breach,
including without limitation costs and expenses incurred in the enforcement of
the Seller's repurchase obligation hereunder, and plus, in the event a Mortgage
Loan is repurchased during the first twelve (12) months following the related
Closing Date, an amount equal to the product of (i) an amount equal to (A) a
fraction, whose numerator is equal to 12 less the number of full calendar months
since the Closing Date and whose denominator is equal to 12, multiplied by (B)
the Premium Percentage, multiplied by (ii) the then outstanding principal
balance of the Mortgage Loan to be repurchased as of the date of such
repurchase.
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RESPA: Real Estate Settlement Procedures Act, as amended from time to
time.
Second Lien Loan: A Mortgage Loan secured by a second lien Mortgage on
the related Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Securitization Transaction. Any transaction involving either (1) 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 (2)
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.
Seller: First Horizon Home Loan Corporation, a Kansas corporation, and
its successors in interest.
Seller Information: As defined in Subsection 31.04(a).
Servicing Fee: With respect to each Mortgage Loan subject to the
Interim Servicing Agreement, an amount equal to 0.50% per annum computed on the
basis of the outstanding principal balance of the related Mortgage Loan. Such
fee shall be payable monthly and shall be pro rated for any portion of a month
during which the Mortgage Loan is serviced by the Interim Servicer under the
Interim Servicing Agreement. 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 this Agreement) of such Monthly Payment
collected by the Interim Servicer, or as otherwise provided under this
Agreement.
Servicing File: With respect to each Mortgage Loan, the file retained
by the Interim Servicer consisting of copies of the Mortgage Loan Documents.
Servicing Rights: Any and all of the following: (a) any and all rights
to service the Mortgage Loans; (b) any payments to or monies received by the
Interim Servicer for servicing the Mortgage Loans; (c) any late fees, penalties
or similar payments with respect to the Mortgage Loans; (d) all agreements or
documents creating, defining or evidencing any such servicing rights to the
extent they relate to such servicing rights and all rights of the Interim
Servicer thereunder; (e) Escrow Payments or other similar payments with respect
to the Mortgage Loans and any amounts actually collected by the Interim Servicer
with respect thereto; (f) all accounts and other rights to payment related to
any of the property described in this paragraph; and (g) any and all documents,
files, records, servicing files, servicing documents, servicing records, data
tapes, computer records, or other information pertaining to the Mortgage Loans
or pertaining to the past, present or prospective servicing of the Mortgage
Loans.
Servicing Transfer Representation: Each representation set forth in
Subsections 9.01(t) and 9.02(b), (c), (d), (f), (h), the last sentence of (p),
(q), (r), (z), (hh), (ii), (kk), (ll), (mm), (qq), (xx), (bbb), (kkk), (ttt)(3)
and (ttt)(4).
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Sponsor: The sponsor, as such term is defined in Regulation AB, with
respect to any Securitization Transaction.
Standard & Poor's: Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies Inc., and its successors in interest.
Standard & Poor's Glossary: The Standard & Poor's LEVELS(R) Glossary,
as may be in effect from time to time.
Stated Principal Balance: As to each Mortgage Loan on any date of
determination, (i) the principal balance of such Mortgage Loan at the related
Cut-off Date after giving effect to payments of principal due on or before such
date, to the extent actually received, minus (ii) all amounts previously
distributed to the Purchaser with respect to the related Mortgage Loan
representing payments or recoveries of principal on such Mortgage Loan.
Static Pool Information: Static pool information as described in Item
1105(a)(1)-(3) and 1105(c) of Regulation AB.
Successor Servicer: Any servicer of one or more Mortgage Loans
designated by the Purchaser as being entitled to the benefits of the
indemnifications set forth in Sections 9.03 and 14.01.
Third Party Originator: Each Person, other than a Qualified
Correspondent, that originated Mortgage Loans acquired by the Seller.
Transfer Date: The date on which the Purchaser, or its designee, shall
receive the transfer of servicing responsibilities and begin to perform the
servicing of the Mortgage Loans with respect to the related Mortgage Loan
Package, and the Interim Servicer shall cease all servicing responsibilities.
Such date shall occur on the day indicated by the Purchaser to the Interim
Servicer in accordance with the Interim Servicing Agreement.
Underwriting Guidelines: The underwriting guidelines of the Seller, a
copy of which is attached hereto as Exhibit I and a then-current copy of which
shall be attached as an Exhibit to the related Assignment and Conveyance.
Whole Loan Transfer: Any sale or transfer of some or all of the
Mortgage Loans other than a Securitization Agreement.
SECTION 2. Agreement to Purchase.
The Seller agrees to sell from time to time, and the Purchaser agrees
to purchase from time to time, Mortgage Loans having an aggregate principal
balance on the related Cut-off Date in an amount as set forth in the related
Purchase Price and Terms Agreement, or in such other amount as agreed by the
Purchaser and the Seller as evidenced by the actual aggregate principal balance
of the Mortgage Loans accepted by the Purchaser on each Closing Date.
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SECTION 3. Mortgage Schedules.
The Seller from time to time shall provide in an electronic format the
Purchaser with certain information constituting a preliminary listing of the
Mortgage Loans to be purchased on each Closing Date in accordance with the
related Purchase Price and Terms Agreement and this Agreement (each, a
"Preliminary Mortgage Schedule").
The Seller shall deliver the Mortgage Loan Schedule for the Mortgage
Loans to be purchased on a particular Closing Date to the Purchaser at least two
(2) Business Days prior to the related Closing Date. The Mortgage Loan Schedule
shall be the related Preliminary Mortgage Schedule with those Mortgage Loans
which the Seller has not funded prior to the related Closing Date deleted.
SECTION 4. Purchase Price.
The Purchase Price for the Mortgage Loans shall be equal to (a) the
Purchase Price Percentage multiplied by the Cut-off Date Balance, plus (b)
accrued and unpaid interest on such principal balance at the weighted average
Mortgage Interest Rate (net of the Servicing Fee) of those Mortgage Loans from
the related Cut-off Date through the day prior to the related Closing Date,
inclusive. For purposes hereof, "Cut-off Date Balance" means the aggregate
principal balance, as of the related Cut-off Date, of the Mortgage Loans listed
on the related Mortgage Loan Schedule, after application of payments of
principal due on or before the related Cut-off Date, to the extent such payments
were actually received, together with any unscheduled principal payments
collected prior to the Cut-off Date; provided, however, that payments of
scheduled principal and interest paid prior to the Cut-off Date, but to be
applied on a due date beyond the related Cut-off Date, shall not be applied to
the principal balance as of the related Cut-off Date. If so provided in the
related Purchase Price and Terms Agreement, portions of the Mortgage Loans shall
be priced separately. The Purchase Price as so determined shall be paid to the
Seller on the related Closing Date by wire transfer of immediately available
funds to an account designated by the Seller in writing.
The Purchaser shall be entitled to (l) all principal paid after the
related Cut-off Date, (2) all other recoveries of principal collected on or
after the related Cut-off Date, and (3) all payments of interest on the Mortgage
Loans net of applicable Servicing Fees (minus that portion of any such payment
which is allocable to the period prior to the related Cut-off Date). The
outstanding principal balance of each Mortgage Loan as of the related Cut-off
Date is determined after application of payments of principal due on or before
the related Cut-off Date, to the extent actually collected, together with any
unscheduled principal prepayments collected prior to the Cut-off Date; provided,
however, that payments of scheduled principal and interest paid prior to the
Cut-off Date, but to be applied on a due date beyond the related Cut-off Date
shall not be applied to the principal balance as of the related Cut-off Date.
Such prepaid amounts shall be the property of the Purchaser. The Seller 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
Seller to the Purchaser.
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SECTION 5. Examination of Mortgage Files.
At least seven (7) Business Days prior to the related Closing Date,
the Seller shall (i) either (a) deliver to the Purchaser or its designee in
escrow, for examination with respect to each Mortgage Loan to be purchased, the
related Mortgage File, including a copy of the Assignment of Mortgage (except
with respect to each MERS Designated Mortgage Loan), pertaining to each Mortgage
Loan, or (b) make the related Mortgage File available to the Purchaser for
examination at such other location as shall otherwise be acceptable to the
Purchaser and (ii) deliver to the Purchaser in an electronic format copies of
the credit and servicing files (collectively, the "Credit Files"). Such
examination of the Mortgage Files may be made by the Purchaser or its designee
at any reasonable time before or after the related Closing Date. If the
Purchaser makes such examination prior to the related Closing Date and
determines, in its sole discretion, that any Mortgage Loans are unacceptable to
the Purchaser for any reason, such Mortgage Loans shall be deleted from the
related Mortgage Loan Schedule, and may be replaced by a Qualified Substitute
Mortgage Loan (or Loans) acceptable to the Purchaser. The Purchaser may, at its
option and without notice to the Seller, purchase some or all of the Mortgage
Loans without conducting any partial or complete examination. The fact that the
Purchaser or its designee has conducted or has failed to conduct any partial or
complete examination of the Mortgage Files or the Credit Files shall not impair
in any way the Purchaser's (or any of its successor's) rights to demand
repurchase, substitution or other remedy as provided in this Agreement. In the
event that the Seller fails to deliver the Credit Files with respect to any
Mortgage Loan, the Seller shall, upon the request of the Purchaser, repurchase
such Mortgage Loan at the price and in the manner specified in Subsection 9.03.
SECTION 6. Conveyance from Seller to Purchaser.
Subsection 6.01 Conveyance of Mortgage Loans; Possession of Servicing
Files.
The Seller, simultaneously with the delivery of the Mortgage Loan
Schedule with respect to the related Mortgage Loan Package to be purchased on
each Closing Date, shall execute and deliver an Assignment and Conveyance
Agreement in the form attached hereto as Exhibit H (the "Assignment and
Conveyance Agreement"). The Seller shall cause the Servicing File retained by
the Interim Servicer pursuant to this Agreement to be appropriately identified
in the Seller's computer system and/or books and records, as appropriate, to
clearly reflect the sale of the related Mortgage Loan to the Purchaser. The
Seller shall cause the Interim Servicer to release from its custody the contents
of any Servicing File retained by it only in accordance with this Agreement or
the Interim Servicing Agreement, except when such release is required in
connection with a repurchase of any such Mortgage Loan pursuant to Subsection
9.03.
Subsection 6.02 Books and Records.
Record title to each Mortgage as of the related Closing Date shall be
in the name of the Seller, the Purchaser or one or more designees of the
Purchaser, as the Purchaser shall select. Notwithstanding the foregoing, each
Mortgage and related Mortgage Note shall be possessed solely by the Purchaser or
the appropriate designee of the Purchaser, as the case may be. All rights
arising out of the Mortgage Loans including, but not limited to, all funds
received
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by the Seller or the Interim Servicer after the related Cut-off Date on or in
connection with a Mortgage Loan shall be vested in the Purchaser or one or more
designees of the Purchaser; provided, however, that all funds received on or in
connection with a Mortgage Loan shall be received and held by the Seller or the
Interim Servicer in trust for the benefit of the Purchaser or the appropriate
designee of the Purchaser, as the case may be, as the owner of the Mortgage
Loans pursuant to the terms of this Agreement.
The sale of each Mortgage Loan shall be reflected on the Seller's
balance sheet and other financial statements as a sale of assets by the Seller.
The Seller shall or shall cause the Interim Servicer to 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 Seller shall or shall
cause the Interim Servicer to maintain in its possession, available for
inspection by the Purchaser, and shall deliver to the Purchaser upon demand,
evidence of compliance with all applicable federal, state and local laws, rules
and regulations, including but not limited to documentation as to the method
used in determining the applicability of the provisions of the National Flood
Insurance Act of 1968, as amended, to the Mortgaged Property, documentation
evidencing insurance coverage and periodic inspection reports, as would be
customarily maintained by prudent sellers and servicers of Mortgage Loans
similar to the Mortgage Loans in the respective jurisdictions.
Subsection 6.03 Delivery of Mortgage Loan Documents.
The Seller shall deliver and release to the Custodian no later than
seven (7) Business Days prior to the related Closing Date those Mortgage Loan
Documents set forth on Exhibit A hereto with respect to each Mortgage Loan set
forth on the related Mortgage Loan Schedule.
The Custodian shall certify its receipt of all such Mortgage Loan
Documents required to be delivered pursuant to the Custodial Agreement for the
related Closing Date, as evidenced by the Certification and Trust Receipt of the
Custodian in the form annexed to the Custodial Agreement. The Purchaser shall
pay all fees and expenses of the Custodian from and after the Closing Date.
The Seller shall or shall cause the Interim Servicer to forward to the
Custodian, or to such other Person as the Purchaser shall designate in writing,
original documents evidencing an assumption, modification, consolidation or
extension of any Mortgage Loan entered into in accordance with this Agreement
within two (2) weeks of their execution, provided, however, that the Seller
shall provide the Custodian, or to such other Person as the Purchaser shall
designate in writing, with a certified true copy of any such document submitted
for recordation within two (2) weeks of its execution, and shall promptly
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 ninety (90) days of its submission for
recordation.
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In the event any document required to be delivered to the Custodian
pursuant to the previous paragraph, including an original or copy of any
document submitted for recordation to the appropriate public recording office,
is not so delivered to the Custodian, or to such other Person as the Purchaser
shall designate in writing, within one hundred and eighty (180) days following
the Closing Date (other than with respect to the Assignments of Mortgage which
shall be delivered to the Custodian in blank and recorded subsequently by the
Purchaser or its designee), and in the event that the Seller does not cure such
failure within thirty (30) days of discovery or receipt of written notification
of such failure from the Purchaser, the related Mortgage Loan shall, upon the
request of the Purchaser, be repurchased by the Seller at the price and in the
manner specified in Subsection 9.03. The foregoing repurchase obligation shall
not apply in the event that the Seller cannot deliver such original or copy of
any document submitted for recordation to the appropriate public recording
office within the specified period due to a delay caused by the recording office
in the applicable jurisdiction, provided that (i) the Seller shall deliver a
recording receipt of such recording office or, if such recording receipt is not
available, a Seller certified copy of such document, confirming that such
documents have been accepted for recording, and (ii) such document is delivered
within twelve (12) months of the related Closing Date.
The Seller shall pay all initial recording fees, if any, for the
assignments of mortgage and any other fees or costs in transferring all original
documents to the Custodian or, upon written request of the Purchaser, to the
Purchaser or the Purchaser's designee. The Purchaser or the Purchaser's designee
shall be responsible for recording the Assignments of Mortgage and shall be
reimbursed by the Seller for the costs associated therewith pursuant to the
preceding sentence.
Subsection 6.04 Quality Control Procedures.
The Seller shall, or shall cause the Interim Servicer to, have an
internal quality control program that verifies in a manner consistent with
accepted industry procedures, on a regular basis, the existence and accuracy of
the legal documents, credit documents, property appraisals, and underwriting
decisions. The program shall include evaluating and monitoring the overall
quality of the Seller's loan production and the servicing activities of the
Interim Servicer. The program is to ensure that the Mortgage Loans are
originated and serviced in accordance with Accepted Servicing Practices and the
Underwriting Guidelines; guard against dishonest, fraudulent, or negligent acts;
and guard against errors and omissions by officers, employees, or other
authorized persons.
Subsection 6.05 MERS Designated Mortgage Loans.
With respect to each MERS Designated Mortgage Loan, the Seller shall,
on or prior to the related Closing Date, designate the Purchaser as the
Investor, and no Person shall be listed as Interim Funder on the MERS System. In
addition, on or prior to the related Closing Date, Seller shall provide the
Custodian and the Purchaser with a MERS Report listing the Purchaser as the
Investor and no Person as Interim Funder with respect to each MERS Designated
Mortgage Loan.
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SECTION 7. Servicing of the Mortgage Loans.
The Mortgage Loans have been sold by the Seller to the Purchaser on a
servicing released basis. Subject to, and upon the terms and conditions of this
Agreement and the Interim Servicing Agreement (with respect to each Mortgage
Loan, for an interim period, as specified therein), the Seller hereby sells,
transfers, assigns, conveys and delivers to the Purchaser the Servicing Rights.
The Purchaser shall retain the Interim Servicer as contract servicer
of the Mortgage Loans for an interim period pursuant to and in accordance with
the terms and conditions contained in the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Except as set forth in the Interim Servicing Agreement, the Interim Servicer
shall service the Mortgage Loans on an "actual/actual" basis and otherwise in
strict compliance with the servicing provisions related to the Xxxxxx Xxx MBS
Program (Special Servicing Option) of the Xxxxxx Mae Guides (except as otherwise
set forth in the Interim Servicing Agreement). The Purchaser and Seller shall
cause the Interim Servicer to execute the Interim Servicing Agreement on the
initial Closing Date.
Pursuant to the Interim Servicing Agreement (with respect to each
Mortgage Loan, for an interim period, as specified therein), the Interim
Servicer shall begin servicing the Mortgage Loans on behalf of the Purchaser and
shall be entitled to a Servicing Fee with respect to such Mortgage Loans until
the applicable Transfer Date. The Interim Servicer shall conduct such servicing
in accordance with the Interim Servicing Agreement.
SECTION 8. Transfer of Servicing.
On the applicable Transfer Date, the Purchaser, or its designee, shall
assume all servicing responsibilities related to, and the Seller shall cause the
Interim Servicer to cease all servicing responsibilities related to, the related
Mortgage Loans subject to such Transfer Date. The Transfer Date shall be the
date determined in accordance with Section 6.02 of the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
On or prior to the applicable Transfer Date, the Seller shall, at its
sole cost and expense, take such steps as may be necessary or appropriate to
effectuate and evidence the transfer of the servicing of the related Mortgage
Loans to the Purchaser, or its designee, including but not limited to the
following:
(a) Notice to Mortgagors. The Seller shall cause the Interim Servicer
to mail to the Mortgagor of each related Mortgage Loan a letter advising such
Mortgagor of the transfer of the servicing of the related Mortgage Loan to the
Purchaser, or its designee, in accordance with the Xxxxxxxx Xxxxxxxx National
Affordable Housing Act of 1990; provided, however, the content and format of the
letter shall have the prior approval of the Purchaser. The Seller shall provide
the Purchaser with a form of such notices on or prior to the Transfer Date and
shall provide the Purchaser with an electronic file of all such notices within 5
Business Days of the Transfer Date.
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(b) Notice to Taxing Authorities and Insurance Companies. The Seller
shall cause the Interim Servicer to transmit to the applicable taxing
authorities and insurance companies (including primary mortgage insurance policy
insurers, if applicable) and/or agents, notification of the transfer of the
servicing to the Purchaser, or its designee, and instructions to deliver all
notices, tax bills and insurance statements, as the case may be, to the
Purchaser from and after the Transfer Date. The Seller shall provide the
Purchaser with a form of such notices on or prior to the Transfer Date and shall
provide the Purchaser with an electronic file of all such notices no later than
five (5) Business Days of the Transfer Date.
(c) Delivery of Servicing Records. The Seller shall cause the Interim
Servicer to forward to the Purchaser, or its designee, in electronic format all
servicing records and the Servicing File in the Interim Servicer's possession
(which includes scanned copies of all documents in the Servicing File) relating
to each related Mortgage Loan including the information enumerated in the
Interim Servicing Agreement (with respect to each such Mortgage Loan, for an
interim period, as specified therein).
(d) Escrow Payments. The Seller shall cause the Interim Servicer to
provide the Purchaser, or its designee, with immediately available funds by wire
transfer in the amount of the net Escrow Payments and suspense balances and all
loss draft balances associated with the related Mortgage Loans. The Seller shall
cause the Interim Servicer to provide the Purchaser with an accounting
statement, in electronic format acceptable to the Purchaser in its sole
discretion, of Escrow Payments and suspense balances and loss draft balances
sufficient to enable the Purchaser to reconcile the amount of such payment with
the accounts of the Mortgage Loans. Additionally, the Seller shall cause the
Interim Servicer to wire transfer to the Purchaser the amount of any agency,
trustee or prepaid Mortgage Loan payments and all other similar amounts held by
the Interim Servicer.
(e) Payoffs and Assumptions. The Seller shall cause the Interim
Servicer to provide to the Purchaser, or its designee, copies of all assumption
and payoff statements generated by the Interim Servicer on the related Mortgage
Loans from the related Cut-off Date to the Transfer Date.
(f) Mortgage Payments Received Prior to Transfer Date. Prior to the
Transfer Date all payments received by the Interim Servicer or the Seller on
each related Mortgage Loan shall be properly applied by the Seller to the
account of the particular Mortgagor.
(g) Mortgage Payments Received after Transfer Date. The amount of any
related Monthly Payments received by the Seller after the Transfer Date shall be
forwarded to the Purchaser by overnight mail within 2 Business Days of the date
of receipt. The Seller shall notify the Purchaser of the particulars of the
payment, which notification requirement shall be satisfied if the Seller
forwards with its payment sufficient information to permit appropriate
processing of the payment by the Purchaser. The Seller shall assume full
responsibility for the necessary and appropriate legal application of such
Monthly Payments received by the Seller after the Transfer Date with respect to
related Mortgage Loans then in foreclosure or bankruptcy; provided, for purposes
of this Agreement, necessary and appropriate legal application of such Monthly
Payments shall include, but not be limited to, endorsement of a Monthly Payment
to the Purchaser with the particulars of the payment such as the account number,
dollar amount, date
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received and any special Mortgagor application instructions and the Seller shall
cause the Interim Servicer to comply with the foregoing requirements with
respect to all Monthly Payments received by the Interim Servicer after the
Transfer Date.
(h) Misapplied Payments. Misapplied payments shall be processed as
follows:
(i) All parties shall cooperate in correcting misapplication errors;
(ii) The party receiving notice of a misapplied payment occurring
prior to the applicable Transfer Date and discovered after the Transfer
Date shall immediately notify the other party;
(iii) If a misapplied payment which occurred prior to the Transfer
Date cannot be identified and said misapplied payment has resulted in a
shortage in a Custodial Account or Escrow Account, the Seller shall be
liable for the amount of such shortage. The Seller shall reimburse the
Purchaser for the amount of such shortage within thirty (30) days after
receipt of written demand therefor from the Purchaser;
(iv) If a misapplied payment which occurred prior to the Transfer Date
has created an improper Purchase Price as the result of an inaccurate
outstanding principal balance, a check shall be issued to the party shorted
by the improper payment application within five (5) Business Days after
notice thereof by the other party; and
(v) Any check issued under the provisions of this Section 8(h) shall
be accompanied by a statement indicating the corresponding Seller and/or
the Purchaser Mortgage Loan identification number and an explanation of the
allocation of any such payments.
(i) Books and Records. On the Transfer Date, the books, records and
accounts of the Seller with respect to the related Mortgage Loans shall be in
accordance with all applicable Purchaser requirements.
(j) Reconciliation. The Seller shall, on or before the Transfer Date,
reconcile principal balances and make any monetary adjustments required by the
Purchaser. Any such monetary adjustments will be transferred between the Seller
and the Purchaser as appropriate.
(k) IRS Forms. The Seller shall or shall cause the Interim Servicer to
file all IRS forms 1099, 1099A, 1098 or 1041 and K-1 and all other forms
required to be filed which are required to be filed on or before the Transfer
Date in relation to the servicing and ownership of the related Mortgage Loans.
The Seller shall provide copies of such forms to the Purchaser upon request and
shall reimburse the Purchaser for any costs or penalties incurred by the
Purchaser due to the Seller's failure to comply with this paragraph.
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SECTION 9. Representations, Warranties and Covenants of the Seller;
Remedies for Breach.
Subsection 9.01 Representations and Warranties Regarding the Seller.
The Seller represents, warrants and covenants to the Purchaser that as
of the date hereof and as of each Closing Date:
(a) Due Organization and Authority. The Seller is a corporation duly
organized, validly existing and in good standing under the laws of the state of
Kansas 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 wherein
it owns or leases any material properties or where a Mortgaged Property is
located, if the applicable laws of such state require licensing or qualification
in order to conduct business of the type conducted by the Seller, and in any
event the Seller 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
and the Interim Servicing Agreement; the Seller has the full corporate power,
authority and legal right to hold, transfer and convey the Mortgage Loans and to
execute and deliver this Agreement and to perform its obligations hereunder and
thereunder; the execution, delivery and performance of this Agreement (including
all instruments of transfer to be delivered pursuant to this Agreement) by the
Seller and the consummation of the transactions contemplated hereby and thereby
have been duly and validly authorized; this Agreement and all agreements
contemplated hereby have been duly executed and delivered and constitute the
valid, legal, binding and enforceable obligations of the Seller, regardless of
whether such enforcement is sought in a proceeding in equity or at law; and all
requisite corporate or other action has been taken by the Seller to make this
Agreement and all agreements contemplated hereby valid and binding upon the
Seller in accordance with their terms;
(b) Ordinary Course of Business. The consummation of the transactions
contemplated by this Agreement are in the ordinary course of business of the
Seller, and the transfer, assignment and conveyance of the Mortgage Notes and
the Mortgages by the Seller 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 or origination of the Mortgage Loans by the Seller,
the sale of the Mortgage Loans to the Purchaser, the consummation of the
transactions contemplated hereby and thereby, 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, conditions or provisions of the
Seller's charter, by-laws or other organizational documents or any legal
restriction or any agreement or instrument to which the Seller is now a party or
by which it is bound, or constitute a default or result in an acceleration under
any of the foregoing, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Seller or its property is subject, or
result in the creation or imposition of any lien, charge or encumbrance that
would have an adverse effect upon any of its properties pursuant to the terms of
any mortgage, contract, deed of trust or other instrument, or impair the ability
of the Purchaser to realize on the Mortgage Loans, impair the value of the
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Mortgage Loans, or impair the ability of the Purchaser to realize the full
amount of any insurance benefits accruing pursuant to this Agreement;
(d) Ability to Service. The Interim Servicer has the facilities,
procedures, and experienced personnel necessary for the sound servicing of
mortgage loans of the same type as the Mortgage Loans. The Interim Servicer is
duly qualified, licensed, registered and otherwise authorized under all
applicable federal, state and local laws, and regulations, if applicable, meets
the minimum capital requirements set forth by the OTS, the OCC or the FDIC, and
is in good standing to enforce, originate, sell mortgage loans to, and service
mortgage loans in each jurisdiction wherein the Mortgaged Properties are
located;
(e) Reasonable Servicing Fee. The Seller as Interim Servicer,
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 Interim Servicer, for accounting and tax purposes, as
compensation for the servicing and administration of the Mortgage Loans pursuant
to this Agreement and the Interim Servicing Agreement;
(f) Ability to Perform; Solvency. The Seller 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 Seller is solvent and the sale
of the Mortgage Loans will not cause the Seller to become insolvent. The sale of
the Mortgage Loans is not undertaken with the intent to hinder, delay or defraud
any of Seller's creditors;
(g) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or threatened against the Seller, before any court,
administrative agency or other tribunal asserting the invalidity of this
Agreement, seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or 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 Seller, or in any
material impairment of the right or ability of the Seller to carry on its
business substantially as now conducted, or in any material liability on the
part of the Seller, or which would draw into question the validity of this
Agreement or the Mortgage Loans or of any action taken or to be taken in
connection with the obligations of the Seller contemplated herein, or which
would be likely to impair the ability of the Seller to perform under the terms
of this Agreement;
(h) No Consent Required. No consent, approval, authorization or order
of, or registration or filing with, or notice to any court or governmental
agency or body including HUD, the FHA or the Department of Veterans Affairs is
required for the execution, delivery and performance by the Seller of or
compliance by the Seller with this Agreement or the Mortgage Loans, the delivery
of a portion of the Mortgage Files to the Custodian or the sale of the Mortgage
Loans or the consummation of the transactions contemplated by this Agreement, or
if required, such approval has been obtained prior to the related Closing Date;
(i) Selection Process. The Mortgage Loans were selected from among the
outstanding one- to four-family mortgage loans in the Seller's portfolio at the
related Closing Date as to which the representations and warranties set forth in
Subsection 9.02 could be made
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and such selection was not made in a manner so as to affect adversely the
interests of the Purchaser;
(j) Mortgage Loan Package Characteristics. The characteristics of the
related Mortgage Loan Package are as set forth on the description of the pool
characteristics for the applicable Mortgage Loan Package delivered pursuant to
Section 11 on the related Closing Date in the form attached as Exhibit B to each
related Assignment and Conveyance Agreement;
(k) No Untrue Information. Neither this Agreement nor any information,
statement, tape, diskette, report, form, or other document furnished or to be
furnished pursuant to this Agreement or any Reconstitution Agreement or in
connection with the transactions contemplated hereby (including any
Securitization Transaction or Whole Loan Transfer) contains or will contain any
untrue statement of fact or omits or will omit to state a fact necessary to make
the statements contained herein or therein not misleading;
(l) Financial Statements. The Seller has delivered to the Purchaser
financial statements as to its last three (3) complete fiscal years and any
later quarter ended more than sixty (60) days prior to the execution of this
Agreement. All such financial statements fairly present the pertinent results of
operations and changes in financial position for each of such periods and the
financial position at the end of each such period of the Seller and its
subsidiaries and have been prepared in accordance with generally accepted
accounting principles of the United States consistently applied throughout the
periods involved, except as set forth in the notes thereto. In addition, the
Seller has delivered information as to its loan gain and loss experience in
respect of foreclosures and its loan delinquency experience for the immediately
preceding three-year period, in each case with respect to mortgage loans owned
by it and mortgage loans serviced for others during such period, and all such
information so delivered shall be true and correct in all material respects to
the extent requested by the Purchaser and available to the Seller. There has
been no change in the business, operations, financial condition, properties or
assets of the Seller since the date of the Seller's financial statements that
would have an adverse effect on its ability to perform its obligations under
this Agreement. The Seller has completed any forms requested by the Purchaser in
a timely manner and in accordance with the provided instructions;
(m) No Brokers. The Seller 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;
(n) Sale Treatment. The Seller has been advised by its independent
certified public accountants that under generally accepted accounting principles
the transfer of the Mortgage Loans may be treated as a sale on the books and
records of the Seller and the Seller has determined that the disposition of the
Mortgage Loans pursuant to this Agreement will be afforded sale treatment for
tax and accounting purposes;
(o) Reasonable Purchase Price. The consideration received by the
Seller upon the sale of the Mortgage Loans under this Agreement constitutes fair
consideration and reasonably equivalent value for the Mortgage Loans;
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(p) Owner of Record. The Seller is the owner of record of each
Mortgage and the indebtedness evidenced by each Mortgage Note, and upon the sale
of the Mortgage Loans to the Purchaser, the Seller will retain the Mortgage
Files with respect thereto in trust only for the purpose of servicing and
supervising the servicing of each Mortgage Loan;
(q) Seller's Origination. The Seller's decision to originate any
mortgage loan or to deny any mortgage loan application is an independent
decision based upon Seller's underwriting guidelines, and is in no way made as a
result of Purchaser's decision to purchase, or not to purchase, or the price
Purchaser may offer to pay for, any such mortgage loan, if originated; and
(r) Compliance with Anti-Money Laundering Laws. The Seller has
complied with all applicable anti-money laundering laws, regulations and
executive orders, including without limitation the USA Patriot Act of 2001
(collectively, the "Anti-Money Laundering Laws"); the Seller has established an
anti-money laundering compliance program as required by the Anti-Money
Laundering Laws, has conducted the requisite due diligence in connection with
the origination of each Mortgage Loan for purposes of the Anti-Money Laundering
Laws, including with respect to the legitimacy of the applicable Mortgagor and
the origin of the assets used by the said Mortgagor to purchase the property in
question, and maintains, and will maintain, sufficient information to identify
the applicable Mortgagor for purposes of the Anti-Money Laundering Laws;
(s) Delivery to the Custodian. The Mortgage Note, the Mortgage, the
Assignment of Mortgage and any other documents required to be delivered with
respect to each Mortgage Loan pursuant to this Agreement shall be delivered to
the Custodian all in compliance with the specific requirements of this
Agreement. With respect to each Mortgage Loan, the Seller will be in possession
of a complete Mortgage File in compliance with Exhibit A hereto, except for such
documents as will be delivered to the Custodian; and
(a) Credit Reporting. The Seller, for so long as it is the Interim
Servicer for each Mortgage Loan will 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.
Subsection 9.02 Representations and Warranties Regarding Individual
Mortgage Loans.
The Seller hereby represents and warrants to the Purchaser that, as to
each Mortgage Loan, as of the related Closing Date for such Mortgage Loan:
(a) Mortgage Loans as Described. The information set forth in the
Mortgage Loan Schedule is complete, true and correct;
(b) Payments Current. All payments required to be made up to the
Closing Date under the terms of the Mortgage Note have been made and credited.
As of the Closing Date, no payment required under the Mortgage Loan is thirty
(30) days or more delinquent nor has any payment under the Mortgage Loan been
thirty (30) days or more delinquent at any time
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since the origination of the Mortgage Loan. The first Monthly Payment after the
Cut-off Date shall be made with respect to the Mortgage Loan on its Due Date or
within the grace period, all in accordance with the terms of the related
Mortgage Note;
(c) No Outstanding Charges. There are no defaults in complying with
the terms of the Mortgage securing the Mortgage Loan, and all taxes,
governmental assessments, insurance premiums, water, sewer and municipal
charges, leasehold payments or ground rents which previously became due and
owing have been paid, or an escrow of funds has been established in an amount
sufficient to pay for every such item which remains unpaid and which has been
assessed but is not yet due and payable. Except for (A) payments in the nature
of escrow payments and (B) interest accruing from the date of the Mortgage Note
or date of disbursement of the Mortgage Loan proceeds, whichever is earlier to
the day which precedes by one (1) month the Due Date of the first installment of
principal and interest, including, without limitation, taxes and insurance
payments, the Seller has not advanced funds, or induced, solicited or knowingly
received any advance of funds by a party other than the Mortgagor, directly or
indirectly, for the payment of any amount required under the Mortgage Loan;
(d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any respect,
from the date of origination 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 Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. 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, and which assumption agreement is part of the Mortgage Loan File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the Mortgage Loan
Schedule;
(e) 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, and no Mortgagor
was a debtor in any state or federal bankruptcy or insolvency proceeding at, or
subsequent to, the time the Mortgage Loan was originated;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are provided for in the Xxxxxx Xxx Guides or by
Xxxxxxx Mac, as well as all additional requirements set forth in Section 2.10 of
the Interim Servicing Agreement attached hereto as Exhibit B. If required by the
National Flood Insurance Act of 1968, as amended, each Mortgage Loan is covered
by a flood insurance policy meeting the requirements of the current guidelines
of the Federal Insurance Administration in effect, which policy conforms to
Xxxxxx Xxx and Xxxxxxx Mac, as well as all
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additional requirements set forth in Section 2.10 of the Interim Servicing
Agreement attached hereto as Exhibit B. All individual insurance policies
contain a standard mortgagee clause naming the Seller and its successors and
assigns as mortgagee, and all premiums thereon have been paid and such policies
may not be reduced, terminated or cancelled without thirty (30) days' prior
written notice to the mortgagee. The Mortgage obligates the Mortgagor thereunder
to maintain the hazard insurance policy at the Mortgagor's cost and expense, and
on the Mortgagor's failure to do so, authorizes the holder of the Mortgage to
obtain and maintain such insurance at such Mortgagor's cost and expense, and to
seek reimbursement therefor from the Mortgagor. Where required by state law or
regulation, the Mortgagor has been given an opportunity to choose the carrier of
the required hazard insurance, provided the policy is not a "master" or
"blanket" hazard insurance policy covering a condominium, or any hazard
insurance policy covering the common facilities of a planned unit development.
The hazard insurance policy is the valid and binding obligation of the insurer,
is in full force and effect, and will be in full force and effect and inure to
the benefit of the Purchaser upon the consummation of the transactions
contemplated by this Agreement. The Seller has not engaged in, and has no
knowledge of the Mortgagor's or any servicer's having engaged in, any act or
omission which would impair the coverage of any such policy, the benefits of the
endorsement provided for herein, or the validity and binding effect of such
policy, including, without limitation, no unlawful fee, commission, kickback or
other unlawful compensation or value of any kind has been or will be received,
retained or realized by any attorney, firm or other person or entity, and no
such unlawful items have been received, retained or realized by the Seller;
(g) Compliance with Applicable Laws. Any and all requirements of any
applicable federal, state or local law including, without limitation, usury,
truth-in-lending, real estate settlement procedures, consumer credit protection,
predatory, abusive and fair lending, equal credit opportunity and disclosure
laws, including, without limitation, any provisions relating to prepayment
penalties, have been complied with, the consummation of the transactions
contemplated hereby will not involve the violation of any such laws or
regulations, and the Seller 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. This representation is a Deemed
Material Breach Representation;
(h) 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 release,
cancellation, subordination or rescission. The Seller has not waived the
performance by the Mortgagor of any action, if the Mortgagor's failure to
perform such action would cause the Mortgage Loan to be in default, nor has the
Seller waived any default resulting from any action or inaction by the
Mortgagor;
(i) Location and Type of Mortgaged Property. The Mortgaged Property is
a fee simple property located in the state identified in the Mortgage Loan
Schedule except that with respect to real property located in jurisdictions in
which the use of leasehold estates for residential properties is a
widely-accepted practice, the Mortgaged Property may be a leasehold estate and
consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a low-rise condominium project, or an individual
unit in a planned unit development and that
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no residence or dwelling is a mobile home, provided, however, that any
condominium unit or planned unit development shall not fall within any of the
"Ineligible Projects" of part XII, Section 102 of the Xxxxxx Mae Selling Guide
and shall conform with the Underwriting Guidelines. In the case of any Mortgaged
Properties that are manufactured homes (a "Manufactured Home Mortgage Loans"),
(A) (i) such Manufactured Home Mortgage Loan conforms with the applicable Xxxxxx
Xxx or Xxxxxxx Mac requirements regarding mortgage loans related to manufactured
dwellings, (ii) the related manufactured dwelling is permanently affixed to the
land, (iii) the related manufactured dwelling and the related land are subject
to a Mortgage properly filed in the appropriate public recording office and
naming Seller as mortgagee, (iv) the applicable laws of the jurisdiction in
which the related Mortgaged Property is located will deem the manufactured
dwelling located on such Mortgaged Property to be a part of the real property on
which such dwelling is located, (v) such Manufactured Home Mortgage Loan is (x)
a qualified mortgage under Section 860G(a)(3) of the Internal Revenue Code of
1986, as amended and (y) secured by manufactured housing treated as a single
family residence under Section 25(e)(10) of the Code (i.e., such manufactured
home has a minimum of 400 square feet of living space, a minimum width in excess
of 102 inches and which is of a kind customarily used at a fixed location) and
(vi) as of the origination date of the related Mortgage Loan, the related
manufactured housing unit that secures such Mortgage Loan either (x) was the
principal residence of the Mortgagor or (y) was classified as real property
under applicable state law. As of the date of origination, no portion of the
Mortgaged Property was used for commercial purposes, and since the date of
origination, no portion of the Mortgaged Property has been used for commercial
purposes; provided, that Mortgaged Properties which contain a home office shall
not be considered as being used for commercial purposes as long as the Mortgaged
Property has not been altered for commercial purposes and is not storing any
chemicals or raw materials other than those commonly used for homeowner repair,
maintenance and/or household purposes. This representation is a Deemed Material
Breach Representation;
(j) Valid First and Second Lien. Each Mortgage is a valid and
subsisting first lien, with respect to First Lien Loans, or second lien, with
respect to Second Lien Loans, of record on a single parcel of real estate
constituting the Mortgaged Property, including all buildings and improvements 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,
subject in all cases to the exceptions to title set forth in the title insurance
policy with respect to the related Mortgage Loan, which exceptions are generally
acceptable to prudent mortgage lending companies, and such other exceptions to
which similar properties are commonly subject and which do not individually, or
in the aggregate, materially and adversely affect the benefits of the security
intended to be provided by such Mortgage. In no event shall any Mortgage Loan be
in a lien position more junior than a second lien. The lien of the Mortgage is
subject only to:
(1) with respect to Second Lien Loans, the lien of the first
mortgage on the Mortgaged Property;
(2) the lien of current real property taxes and assessments
not yet due and payable;
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(3) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date
of recording acceptable to prudent mortgage lending institutions
generally and specifically referred to in the lender's title
insurance policy delivered to the originator of the Mortgage Loan
and (a) specifically referred to or otherwise considered in the
appraisal made for the originator of the Mortgage Loan or (b)
which do not adversely affect the Appraised Value of the
Mortgaged Property set forth in such appraisal; and
(4) 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, enforceable and perfected (A) first lien and first priority security
interest with respect to each First Lien Loan, or (B) second lien and second
priority security interest with respect to each Second Lien Loan, in either
case, on the property described therein and Seller has full right to sell and
assign the same to Purchaser;
(k) Validity of Mortgage Documents. The Mortgage Note and the Mortgage
and any other agreement executed and delivered by a Mortgagor or guarantor, if
applicable, in connection with a Mortgage Loan are genuine, and each is the
legal, valid and binding obligation of the maker thereof enforceable in
accordance with its terms (including, without limitation, any provisions therein
relating to prepayment penalties). All parties to the Mortgage Note, the
Mortgage and any other such related agreement had legal capacity to enter into
the Mortgage Loan and to execute and deliver the Mortgage Note, the Mortgage and
any other related agreement, and the Mortgage Note, the Mortgage and any other
such related agreement have been duly and properly executed by other such
related parties. The documents, instruments and agreements submitted for loan
underwriting were not falsified and contain no untrue statement of material fact
or omit to state a material fact required to be stated therein or necessary to
make the information and statements therein not misleading. No fraud, error,
omission, misrepresentation, negligence or similar occurrence with respect to a
Mortgage Loan has taken place on the part of any Person, including without
limitation, the Mortgagor, any appraiser, any builder or developer, or any other
party involved in the origination or servicing of the Mortgage Loan. The Seller
has reviewed all of the documents constituting the Servicing File and has made
such inquiries as it deems necessary to make and confirm the accuracy of the
representations set forth herein;
(l) Full Disbursement of Proceeds. The Mortgage Loan has been closed
and the proceeds of the Mortgage Loan have been fully disbursed and there is no
requirement for future advances thereunder, and any and all requirements as to
completion of any on-site or off-site improvement and as to disbursements of any
escrow funds therefor have been complied with. 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;
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(m) Ownership. The Seller is the sole owner of record and holder of
the Mortgage Loan and the indebtedness evidenced by each Mortgage Note and upon
the sale of the Mortgage Loans to the Purchaser, the Seller will retain the
Mortgage Files or any part thereof with respect thereto not delivered to the
Custodian, the Purchaser or the Purchaser's designee, in trust only for the
purpose of servicing and supervising the servicing of each Mortgage Loan. The
Mortgage Loan is not assigned or pledged, and the Seller has good, indefeasible
and marketable title thereto, and has full right to transfer and sell the
Mortgage Loan to the Purchaser free and clear of any encumbrance, equity,
participation interest, lien, pledge, charge, claim or security interest, and
has full right and authority subject to no interest or participation of, or
agreement with, any other party, to sell and assign each Mortgage Loan pursuant
to this Agreement and following the sale of each Mortgage Loan, the Purchaser
will own such Mortgage Loan free and clear of any encumbrance, equity,
participation interest, lien, pledge, charge, claim or security interest. The
Seller intends to relinquish all rights to possess, control and monitor the
Mortgage Loan. After the Closing Date, the Seller will have no right to modify
or alter the terms of the sale of the Mortgage Loan and the Seller will have no
obligation or right to repurchase the Mortgage Loan or substitute another
Mortgage Loan, except as provided in this Agreement;
(n) Doing Business. 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 (2) either (i) organized
under the laws of such state, or (ii) qualified to do business in such state to
the extent required by applicable law to do business in such state, or (iii) a
federal savings and loan association, a savings bank or a national bank having a
principal office in such state, or (3) not doing business in such state;
(o) CLTV, LTV; FICO Score. No Mortgage Loan that is a Second Lien Loan
has a CLTV in excess of 100%. No Mortgage Loan has an LTV greater than 100%. At
origination of the Mortgage Loan, the Mortgagor did not have a FICO score of
less than 500;
(p) Title Insurance. The Mortgage Loan is covered by an ALTA lender's
title insurance policy or other generally acceptable form of policy or insurance
acceptable to Xxxxxx Xxx or Xxxxxxx Mac and each such title insurance policy is
issued by a title insurer acceptable to Xxxxxx Mae or Xxxxxxx Mac and qualified
to do business in the jurisdiction where the Mortgaged Property is located,
insuring the Seller, its successors and assigns, as to the first priority lien
(with respect to First Lien Loans) or second priority lien (with respect to
Second Lien Loans) of the Mortgage in the original principal amount of the
Mortgage Loan, subject only to the exceptions contained in clauses (1) and (2)
of paragraph (j) of this Subsection 9.02, and in the case of Adjustable Rate
Mortgage Loans, against any loss by reason of the invalidity or unenforceability
of the lien resulting from the provisions of the Mortgage providing for
adjustment to the Mortgage Interest Rate and Monthly Payment. Where required by
state law or regulation, the Mortgagor has been given the opportunity to choose
the carrier of the required mortgage title insurance. Additionally, such
lender's title insurance policy affirmatively insures ingress and egress, and
against encroachments by or upon the Mortgaged Property or any interest therein.
The title policy does not contain any special exceptions (other than the
standard exclusions) for zoning and uses and has been marked to delete the
standard survey exception or to replace the standard survey exception with a
specific survey reading. The Seller, its successor
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and assigns, are the sole insureds of such lender's title insurance policy, and
such lender's title insurance policy is valid and remains 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 related Mortgage, including
the Seller, has done, by act or omission, anything which would impair the
coverage of such lender's title insurance policy, including without limitation,
no unlawful fee, commission, kickback or other unlawful compensation or value of
any kind has been or will be received, retained or realized by any attorney,
firm or other person or entity, and no such unlawful items have been received,
retained or realized by the Seller;
(q) No Defaults. There is no default, breach, violation or event which
would permit acceleration existing under the Mortgage or the Mortgage Note and
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
which would permit acceleration, and neither the Seller nor any of its
affiliates nor any of their respective predecessors, have waived any default,
breach, violation or event which would permit acceleration. With respect to each
Second Lien Loan, (i) the prior mortgage is in full force and effect, (ii) there
is no default, breach, violation or event of acceleration existing under such
prior mortgage or the related mortgage note, (iii) there is 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 of acceleration
thereunder, and either (A) the prior mortgage contains a provision which allows
or (B) applicable law requires, the mortgagee under the Second Lien Loan to
receive notice of, and affords such mortgagee an opportunity to cure any default
by payment in full or otherwise under the prior mortgage;
(r) 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;
(s) Location of Improvements; No Encroachments. 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. The Mortgaged Property and all improvements located on or
being part of the Mortgaged Property are in compliance with all applicable
zoning and building laws, ordinances and regulations;
(t) Origination; Payment Terms. The Mortgage Loan was originated by a
mortgagee approved by the Secretary of Housing and Urban Development pursuant to
Sections 203 and 211 of the Act, a savings and loan association, a savings bank,
a commercial bank, credit union, insurance company or other similar institution
which is supervised and examined by a federal or state authority. The documents,
instruments and agreements submitted for loan underwriting were not falsified
and contain no untrue statement of material fact or omit to state a material
fact required to be stated therein or necessary to make the information and
statements therein not misleading. No Mortgage Loan contains terms or provisions
which would result in negative amortization. Unless otherwise noted on the
Mortgage Loan Schedule, principal payments on the Mortgage Loan commenced no
more than sixty (60) days after funds were disbursed in connection with the
Mortgage Loan. The Mortgage Interest Rate as well as,
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with respect to Adjustable Rate Mortgage Loans, the Lifetime Rate Cap, the
Periodic Rate Floor and the Periodic Rate Cap are as set forth on Exhibit B to
each related Assignment and Conveyance Agreement. The Mortgage Interest Rate is
adjusted, with respect to Adjustable Rate Mortgage Loans, on each Interest Rate
Adjustment Date to equal the Index plus the Gross Margin (rounded up or down to
the nearest 0.125%), subject to the Periodic Rate Cap. Unless specified on the
related Mortgage Loan Schedule as an interest-only loan, the Mortgage Note is
payable in equal monthly installments of principal and interest, which
installments of interest, with respect to Adjustable Rate Mortgage Loans, are
subject to change due to the adjustments to the Mortgage Interest Rate on each
Interest Rate Adjustment Date, with interest calculated and payable in arrears,
sufficient to amortize the Mortgage Loan fully by the stated maturity date
(unless the Mortgage Loan is identified on the Mortgage Loan Schedule as a
Balloon Mortgage Loan), over an original term of not more than thirty (30) years
from commencement of amortization. Unless otherwise specified on the description
of pool characteristics for the applicable Mortgage Loan Package delivered
pursuant to Section 11 on the related Closing Date in the form attached as
Exhibit B to each related Assignment and Conveyance Agreement, the Mortgage Loan
is payable on the first day of each month. There are no Convertible Mortgage
Loans which contain a provision allowing the Mortgagor to convert the Mortgage
Note from an adjustable interest rate Mortgage Note to a fixed interest rate
Mortgage Note. Unless otherwise noted on the Mortgage Loan Schedule, the Due
Date of the first payment under the Mortgage Note is no more than sixty (60)
days from the date of the Mortgage Note;
(u) 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. Upon default by a Mortgagor on a Mortgage Loan and
foreclosure on, or trustee's sale of, the Mortgaged Property pursuant to the
proper procedures, the holder of the Mortgage Loan will be able to deliver good
and merchantable title to the Mortgaged Property. 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, subject to applicable federal and state laws and judicial precedent
with respect to bankruptcy and right of redemption or similar law;
(v) Conformance with Agency and Underwriting Guidelines. The Mortgage
Loan was underwritten in accordance with the Underwriting Guidelines (a copy of
which is attached to the related Assignment and Conveyance Agreement as Exhibit
C). The Mortgage Note and Mortgage are on forms acceptable to Xxxxxxx Mac or
Xxxxxx Mae and no representations have been made to a Mortgagor that are
inconsistent with the mortgage instruments used;
(w) Occupancy of the Mortgaged Property. As of the Closing Date the
Mortgaged Property is lawfully occupied under applicable law. 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. The Seller has not received notification from any
Governmental Authority that the Mortgaged Property is in material non-compliance
with such laws or
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regulations, is being used, operated or occupied unlawfully or has failed to
have or obtain such inspection, licenses or certificates, as the case may be.
The Seller has not received notice of any violation or failure to conform with
any such law, ordinance, regulation, standard, license or certificate. Unless
otherwise noted on the Mortgage Loan Schedule, the Mortgagor represented at the
time of origination of the Mortgage Loan that the Mortgagor would occupy the
Mortgaged Property as the Mortgagor's primary residence;
(x) No Additional Collateral. The Mortgage Note is not and has not
been secured by any collateral except the lien of the corresponding Mortgage and
the security interest of any applicable security agreement or chattel mortgage
referred to in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and duly qualified under applicable law to serve as
such, has been properly designated and currently so serves and is named in the
Mortgage (or in the case of a substitution of trustee, is named in a properly
recorded substitution of trustee), and no fees or expenses are or will become
payable by the Purchaser, the Custodian or the Interim Servicer to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor;
(z) Acceptable Investment. To the knowledge of the Seller, there are
no circumstances or conditions with respect to the Mortgage, the Mortgaged
Property, the Mortgagor, the Mortgage File or the Mortgagor's credit standing
that can reasonably be expected to cause private institutional investors to
regard the Mortgage Loan as an unacceptable investment, cause the Mortgage Loan
to become delinquent, or adversely affect the value or marketability of the
Mortgage Loan, or cause the Mortgage Loan to prepay during any period materially
faster or slower than the mortgage loans originated by the Seller generally;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the Mortgage,
the Assignment of Mortgage and any other documents required to be delivered
under this Agreement for each Mortgage Loan have been delivered to the
Custodian. The Seller is in possession of a complete, true and accurate Mortgage
File in compliance with Exhibit A hereto, except for such documents the
originals of which have been delivered to the Custodian, and the Seller has
retained copies thereof;
(bb) Condominiums/Planned Unit Developments. 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
is (i) acceptable to Xxxxxx Xxx or Xxxxxxx Mac or (ii) located in a condominium
or planned unit development project which has received project approval from
Xxxxxx Mae or Xxxxxxx Mac. The representations and warranties required by Xxxxxx
Mae with respect to such condominium or planned unit development have been
satisfied and remain true and correct;
(cc) Transfer of Mortgage Loans. Except with respect to MERS
Designated Mortgage Loans, the Assignment of Mortgage with respect to each
Mortgage Loan is in recordable form and is acceptable for recording under the
laws of the jurisdiction in which the Mortgaged Property is located. The
transfer, assignment and conveyance of the Mortgage Notes and the Mortgages by
the Seller are not subject to the bulk transfer or similar statutory provisions
in effect in any applicable jurisdiction;
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(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision for the acceleration of the payment
of the unpaid principal balance of the Mortgage Loan in the event that the
Mortgaged Property is sold or transferred without the prior written consent of
the mortgagee thereunder, and to the best of the Seller's knowledge, such
provision is enforceable;
(ee) No Balloon Mortgage Loans. The Mortgage Loan is not a Balloon
Mortgage Loan unless specifically listed on the Mortgage Loan Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to which
Monthly Payments are paid or partially paid with funds deposited in any separate
account established by the Seller, the Mortgagor, or anyone on behalf of the
Mortgagor, or paid by any source other than the Mortgagor nor does it contain
any other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan, and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature. The
indebtedness evidenced by the Mortgage Note is not convertible to an ownership
interest in the Mortgaged Property or the Mortgagor and the Seller has not
financed nor does it own directly or indirectly, any equity of any form in the
Mortgaged Property or the Mortgagor;
(gg) Consolidation of Future Advances. Any future advances made to the
Mortgagor prior to the applicable Cut-off Date have been consolidated with the
outstanding principal amount secured by the Mortgage, and the secured principal
amount, as consolidated, bears a single interest rate and single repayment term.
The lien of the Mortgage securing the consolidated principal amount is expressly
insured as having first or second, as applicable, lien priority by a title
insurance policy, an endorsement to the policy insuring the mortgagee's
consolidated interest or by other title evidence acceptable to Xxxxxx Xxx and
Xxxxxxx Mac. The consolidated principal amount does not exceed the original
principal amount of the Mortgage Loan;
(hh) Mortgaged Property Undamaged; No Condemnation Proceedings. There
is no proceeding pending or threatened for the total or partial condemnation of
the Mortgaged Property. The Mortgaged Property is undamaged by waste, 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 and each Mortgaged
Property is in good repair. There have not been any condemnation proceedings
with respect to the Mortgaged Property and the Seller has no knowledge of any
such proceedings in the future;
(ii) Collection Practices; Escrow Deposits; Interest Rate Adjustments.
The origination, servicing and collection practices with respect to the Mortgage
Loan have been in all respects in compliance with Accepted Servicing Practices,
applicable laws and regulations, and have been in all respects legal and proper.
With respect to escrow deposits and Escrow Payments (other than with respect to
Second Lien Loans for which the mortgagee under the prior mortgage lien is
collecting Escrow Payments), all such payments are in the possession of Seller
and there exist no deficiencies in connection therewith for which customary
arrangements for repayment thereof have not been made. Each Mortgage Loan is
covered by a paid in full, life of
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loan, tax service contract that has been assigned without penalty, premium or
cost to the Purchaser. All Escrow Payments have been collected in full
compliance with state and federal law and the provisions of the related Mortgage
Note and Mortgage. An escrow of funds is not prohibited by applicable law and
has been established in an amount sufficient 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 Seller have been
capitalized under the Mortgage or the Mortgage Note. All Mortgage Interest Rate
adjustments have been made in strict compliance with state and federal law and
the terms of the related Mortgage and Mortgage Note on the related Interest Rate
Adjustment Date. If, pursuant to the terms of the Mortgage Note, another index
was selected for determining the Mortgage Interest Rate, the same index was used
with respect to each Mortgage Note which required a new index to be selected,
and such selection did not conflict with the terms of the related Mortgage Note.
Any and all notices required under applicable law and the terms of the related
Mortgage Note and Mortgage regarding the Mortgage Interest Rate and the Monthly
Payment adjustments have been delivered. Any interest required to be paid
pursuant to state, federal and local law has been properly paid and credited;
(jj) Mortgage Loan Attributes: The Mortgage Loan has the
characteristics set forth on Exhibit B to the related Assignment and Conveyance
Agreement;
(kk) Other Insurance Policies; No Defense to Coverage. No action,
inaction or event has occurred and no state of facts exists or has existed on or
prior to the Closing Date that has resulted or will result in the exclusion
from, denial of, or defense to coverage under any applicable primary mortgage
insurance policy, hazard insurance policy or bankruptcy bond (including, without
limitation, any exclusions, denials or defenses which would limit or reduce the
availability of the timely payment of the full amount of the loss otherwise due
thereunder to the insured), irrespective of the cause of such failure of
coverage. The Seller has caused or will cause to be performed any and all acts
required to preserve the rights and remedies of the Purchaser in any insurance
policies applicable to the Mortgage Loans including, without limitation, any
necessary notifications of insurers, assignments of policies or interests
therein, and establishments of coinsured, joint loss payee and mortgagee rights
in favor of the Purchaser. In connection with the placement of any such
insurance, no commission, fee, or other compensation has been or will be
received by the Seller or by any officer, director, or employee of the Seller or
any designee of the Seller or any corporation in which the Seller or any
officer, director, or employee had a financial interest at the time of placement
of such insurance;
(ll) No Violation of Environmental Laws. The Mortgaged Property is
free from any and all toxic or hazardous substances and there exists no
violation of any local, state or federal environmental law, rule or regulation.
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; 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;
(mm) Servicemembers' Civil Relief Act. The Mortgagor has not notified
the Seller, and the Seller has no knowledge of any relief requested or allowed
to the Mortgagor under the Servicemembers' Civil Relief Act of 1940, as amended,
or any similar state statute;
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(nn) Appraisal. The Seller has delivered to the Purchaser an appraisal
of the Mortgaged Property signed prior to the approval of the Mortgage
application by an appraiser qualified under Xxxxxx Xxx and Xxxxxxx Mac
guidelines who (i) is licensed in the state where the Mortgaged Property is
located, (ii) has no interest, direct or indirect, in the Mortgaged Property or
in any Loan or the security therefor, and (iii) does not receive compensation
that is affected by the approval or disapproval of the Mortgage Loan. The
appraisal shall have been made within one hundred eighty (180) days of the
origination of the Mortgage Loan and shall be completed in compliance with the
Uniform Standards of Professional Appraisal Practice, and all applicable Federal
and state laws and regulations. If the appraisal was made more than one hundred
twenty (120) days before the origination of the Mortgage Loan, the Seller shall
have received and delivered to the Purchaser a recertification of the appraisal;
(oo) Disclosure Materials. The Mortgagor has, to the extent required
by applicable law, executed a statement to the effect that the Mortgagor has,
received all disclosure materials required by applicable law and the Seller has
complied with all applicable law with respect to the making of the Mortgage
Loans. The Seller shall cause the Interim Servicer to maintain such statement in
the Mortgage File;
(pp) Construction or Rehabilitation of Mortgaged Property. The
Mortgage Loan was not made in connection with the construction or rehabilitation
of a Mortgaged Property or facilitating the trade-in or exchange of a Mortgaged
Property;
(qq) No Defense to Insurance Coverage. No action has been taken or
failed to be taken, no event has occurred and no state of facts exists or has
existed on or prior to the Closing Date (whether or not known to the Seller on
or prior to such date) which has resulted or will result in an exclusion from,
denial of, or defense to coverage under any primary mortgage insurance
(including, without limitation, any exclusions, denials or defenses which would
limit or reduce the availability of the timely payment of the full amount of the
loss otherwise due thereunder to the insured) whether arising out of actions,
representations, errors, omissions, negligence, or fraud of the Seller, the
related Mortgagor or any party involved in the application for such coverage,
including the appraisal, plans and specifications and other exhibits or
documents submitted therewith to the insurer under such insurance policy, or for
any other reason under such coverage, but not including the failure of such
insurer to pay by reason of such insurer's breach of such insurance policy or
such insurer's financial inability to pay. In connection with the placement of
any such insurance, no commission, fee, or other compensation has been or will
be received by the Seller or any designee of the Seller or any corporation in
which the Seller or any officer, director, or employee had a financial interest
at the time of placement of such insurance;
(rr) Qualified Mortgage. The Mortgage Loan is a qualified mortgage
under Section 860G(a)(3) of the Code;
(ss) Credit Information. As to each consumer report (as defined in the
Fair Credit Reporting Act, Public Law 91-508) or other credit information
furnished by the Seller to the Purchaser, that Seller has full right and
authority and is not precluded by law or contract from furnishing such
information to the Purchaser and the Purchaser is not precluded by the terms of
the Mortgage Loan Documents from furnishing the same to any subsequent or
prospective
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purchaser of such Mortgage. The Seller has in its capacity as servicer, for each
Mortgage Loan, 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. This representation is a Deemed Material Breach Representation;
(tt) Leaseholds. If the Mortgage Loan is secured by a long-term
residential lease, (1) the lessor under the lease holds a fee simple interest in
the land; (2) the terms of such lease expressly permit the mortgaging of the
leasehold estate, the assignment of the lease without the lessor's consent and
the acquisition by the holder of the Mortgage of the rights of the lessee upon
foreclosure or assignment in lieu of foreclosure or provide the holder of the
Mortgage with substantially similar protections; (3) the terms of such lease do
not (a) allow the termination thereof upon the lessee's default without the
holder of the Mortgage being entitled to receive written notice of, and
opportunity to cure, such default, (b) allow the termination of the lease in the
event of damage or destruction as long as the Mortgage is in existence, (c)
prohibit the holder of the Mortgage from being insured (or receiving proceeds of
insurance) under the hazard insurance policy or policies relating to the
Mortgaged Property or (d) permit any increase in rent other than pre-established
increases set forth in the lease; (4) the original term of such lease is not
less than fifteen (15) years; (5) the term of such lease does not terminate
earlier than five (5) years after the maturity date of the Mortgage Note; and
(6) the Mortgaged Property is located in a jurisdiction in which the use of
leasehold estates in transferring ownership in residential properties is a
widely accepted practice;
(uu) Prepayment Penalty. The Mortgage Loan is subject to a prepayment
penalty as provided in the related Mortgage Note except as set forth on Exhibit
B to each related Assignment and Conveyance Agreement. With respect to each
Mortgage Loan that has a prepayment penalty feature, each such prepayment
penalty is enforceable and will be enforced by the Seller for the benefit of the
Purchaser, and each prepayment penalty is permitted pursuant to applicable
federal, state and local law. Each such prepayment penalty is in an amount equal
to the maximum amount permitted under applicable law and no such prepayment
penalty may provide for a term in excess of five (5) years with respect to
Mortgage Loans originated prior to October, 1, 2002. With respect to Mortgage
Loans originated on or after October 1, 2002, the duration of the prepayment
period shall not exceed three (3) years from the date of the Mortgage Note
unless the Mortgage Loan was modified to reduce the prepayment period to no more
than three (3) years from the date of such Mortgage Note and the Mortgagor was
notified in writing of such reduction in prepayment period. With respect to any
Mortgage Loan that contains a provision permitting imposition of a prepayment
penalty upon a prepayment prior to maturity: (i) the Mortgage Loan provides some
benefit to the Mortgagor (e.g., a rate or fee reduction) in exchange for
accepting such prepayment penalty, (ii) prior to the Mortgage Loan origination,
the Mortgagor was offered the option of obtaining a mortgage loan that did not
require payment of such a penalty and (iii) the prepayment penalty was
adequately disclosed to the Mortgagor in the loan documents pursuant to
applicable state, local and federal law. This representation is a Deemed
Material Breach Representation;
(vv) Assumability. With respect to each Adjustable Rate Mortgage Loan,
the Mortgage Loan Documents provide that after the related first Interest Rate
Adjustment Date, a
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related Mortgage Loan may only be assumed if the party assuming such Mortgage
Loan meets certain credit requirements stated in the Mortgage Loan Documents;
(ww) Conversion to Fixed Interest Rate. With respect to Adjustable
Rate Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;
(xx) Escrow Analysis. With respect to each Mortgage, the Seller has
within the last twelve (12) months (unless such Mortgage was originated within
such twelve month period) analyzed the required Escrow Payments for each
Mortgage and adjusted the amount of such payments so that, assuming all required
payments are timely made, any deficiency will be eliminated on or before the
first anniversary of such analysis, or any overage will be refunded to the
Mortgagor, in accordance with RESPA and any other applicable law;
(yy) Predatory Lending Regulations. No Mortgage Loan is a High Cost
Loan or Covered Loan, as applicable, and no Mortgage Loan originated on or after
October 1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending
Act. No Mortgage Loan is covered by the Home Ownership and Equity Protection Act
of 1994 and no Mortgage Loan is in violation of any applicable comparable state
or local law. The Mortgaged Property is not located in a jurisdiction where a
breach of this representation with respect to the related Mortgage Loan may
result in additional assignee liability to the Purchaser, as determined by
Purchaser in its reasonable discretion, as set forth on Exhibit G, as may be
changed from time to time upon 10 days prior notice from Buyer to Seller. This
representation is a Deemed Material Breach Representation;
(zz) Single Premium Credit Life Insurance Policy. No Mortgagor was
required to purchase any single-premium credit insurance policy (e.g., life,
disability, accident, unemployment or property insurance policy) or debt
cancellation agreement as a condition of obtaining the extension of credit. No
Mortgagor obtained a prepaid single-premium credit insurance policy (e.g., life,
disability, accident, unemployment or property insurance policy) in connection
with the origination of the Mortgage Loan. No proceeds from any Mortgage Loan
were used to purchase single premium credit insurance policies or debt
cancellation agreements as part of the origination of, or as a condition to
closing, such Mortgage Loan. This representation is a Deemed Material Breach
Representation;
(aaa) Regarding the Mortgagor. The Mortgagor is one or more natural
persons and/or trustees for an Illinois land trust or a trustee under a "living
trust" and such "living trust" is in compliance with Xxxxxx Mae guidelines for
such trusts;
(bbb) Insurance. The Seller has caused or will cause to be performed
any and all acts required to preserve the rights and remedies of the Purchaser
in any insurance policies applicable to the Mortgage Loans including, without
limitation, any necessary notifications of insurers, assignments of policies or
interests therein, and establishments of coinsured, joint loss payee and
mortgagee rights in favor of the Purchaser;
(ccc) Simple Interest Mortgage Loans. The Mortgage Loan is not a
simple interest Mortgage Loan;
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(ddd) Flood Certification Contract. The Mortgage Loan is covered by a
paid in full, life of loan, transferable flood certification contract that has
been assigned without penalty, cost or premium to the Purchaser;
(eee) Consent. Either (a) no consent for the Second Lien Loan is
required by the holder of the related first lien or (b) such consent has been
obtained and is contained in the Mortgage File;
(fff) Origination Date. Unless otherwise noted on the related Mortgage
Loan Schedule, the date of origination of the Mortgage Loan shall be no earlier
than three (3) months prior to the date such Mortgage Loan is first purchased by
the Purchaser unless agreed in writing by Purchaser in its sole discretion;
(ggg) No Exception. The Custodian has not noted any material
exceptions on an Exception Report (as defined in the Custodial Agreement) with
respect to the Mortgage Loan which would materially adversely affect the
Mortgage Loan or the Purchaser's ownership of the Mortgage Loan, unless
consented to by the Purchaser;
(hhh) Mortgage Submitted for Recordation. The Mortgage either has been
or will promptly be submitted for recordation in the appropriate governmental
recording office of the jurisdiction where the Mortgaged Property is located;
(iii) Endorsements. The Mortgage Note has been endorsed by Seller for
its own account and not as a fiduciary, trustee, trustor or beneficiary under a
trust agreement;
(jjj) Accuracy of Information. All information provided to the
Purchaser by the Seller with respect to the Mortgage Loan is accurate in all
material respects;
(kkk) Mortgagor Bankruptcy. On or prior to the date thirty (30) days
after the related Closing Date, the Mortgagor has not filed or will not file a
bankruptcy petition or has not become the subject or will not become the subject
of involuntary bankruptcy proceedings or has not consented to or will not
consent to the filing of a bankruptcy proceeding against it or to a receiver
being appointed in respect of the related Mortgaged Property;
(lll) No Construction Loans. No Mortgage Loan was made in connection
with (a) facilitating the trade-in or exchange of a Mortgaged Property or (b)
the construction or rehabilitation of a Mortgaged Property, unless the Mortgage
Loan is a construction-to-permanent mortgage loan listed on the Mortgage Loan
Schedule which has been fully disbursed, all construction work is complete and a
completion certificate has been issued;
(mmm) No Equity Participation. No document relating to the Mortgage
Loan provides for any contingent or additional interest in the form of
participation in the cash flow of the Mortgaged Property or a sharing in the
appreciation of the value of the Mortgaged Property. The indebtedness evidenced
by the Mortgage Note is not convertible to an ownership interest in the
Mortgaged Property or the Mortgagor and Seller has not financed nor does it own
directly or indirectly, any equity of any form in the Mortgaged Property or the
Mortgagor;
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(nnn) Proceeds of Mortgage Loan. The proceeds of the Mortgage Loan
have not been and shall not be used to satisfy, in whole or in part, any debt
owed or owing by the Mortgagor to Seller or any Affiliate or correspondent
thereof unless such debt was originated more than twenty-four (24) months prior
to the origination of such Mortgage Loan;
(ooo) No Arbitration. No Mortgagor with respect to any Mortgage Loan
originated on or after August 1, 2004 agreed to submit to arbitration to resolve
any dispute arising out of or relating in any way to the mortgage loan
transaction. This representation is a Deemed Material Breach Representation;
(ppp) Origination Practices/No Steering. The Mortgagor was not
encouraged or required to select a Mortgage Loan product offered by the Mortgage
Loan's originator which is a higher cost product designed for less creditworthy
borrowers, unless at the time of the Mortgage Loan's origination, such Mortgagor
did not qualify taking into account such facts as, without limitation, the
Mortgage Loan's requirements and the Mortgagor's credit history, income, assets
and liabilities and debt-to-income ratios for a lower-cost credit product then
offered by the Mortgage Loan's originator or any affiliate of the Mortgage
Loan's originator. If, at the time of loan application, the Mortgagor may have
qualified for a lower-cost credit product then offered by any mortgage lending
affiliate of the Mortgage Loan's originator, the Mortgage Loan's originator
referred the Mortgagor's application to such affiliate for underwriting
consideration. For a Mortgagor who seeks financing through a Mortgage Loan
originator's higher-priced subprime lending channel, the Mortgagor was directed
towards or offered the Mortgage Loan originator's standard mortgage line if the
Mortgagor was able to qualify for one of the standard products. This
representation is a Deemed Material Breach Representation;
(qqq) Underwriting Methodology. The methodology used in underwriting
the extension of credit for each Mortgage Loan does not rely solely on the
extent of the Mortgagor's equity in the collateral as the principal determining
factor in approving such extension of credit. The methodology employed objective
criteria such as the Mortgagor's income, assets and liabilities, to the proposed
mortgage payment and, based on such methodology, the Mortgage Loan's originator
made a reasonable determination that at the time of origination the Mortgagor
had the ability to make timely payments on the Mortgage Loan. Such underwriting
methodology confirmed that at the time of origination (application/approval) the
Mortgagor had a reasonable ability to make timely payments on the Mortgage Loan.
This representation is a Deemed Material Breach Representation;
(rrr) Points and Fees. No Mortgagor was charged "points and fees"
(whether or not financed) in an amount greater than (i) $1,000, or (ii) 5% of
the principal amount of such Mortgage Loan, whichever is greater. For purposes
of this representation, such 5% limitation is calculated in accordance with
Xxxxxx Mae's anti-predatory lending requirements as set forth in the Xxxxxx Mae
Guides and "points and fees" (x) include origination, underwriting, broker and
finder fees and charges that the mortgagee imposed as a condition of making the
Mortgage Loan, whether they are paid to the mortgagee or a third party; and (y)
exclude bona fide discount points, fees paid for actual services rendered in
connection with the origination of the Mortgage Loan (such as attorneys' fees,
notaries fees and fees paid for property appraisals, credit reports, surveys,
title examinations and extracts, flood and tax certifications, and home
inspections), the cost of mortgage insurance or credit-risk price adjustments,
the costs of title, hazard, and flood
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insurance policies, state and local transfer taxes or fees, escrow deposits for
the future payment of taxes and insurance premiums, and other miscellaneous fees
and charges which miscellaneous fees and charges, in total, do not exceed 0.25%
of the principal amount of such Mortgage Loan. This representation and warranty
is a Deemed Breach Representation;
(sss) Fees Charges. All fees and charges (including finance charges)
and whether or not financed, assessed, collected or to be collected in
connection with the origination and servicing of each Mortgage Loan has been
disclosed in writing to the Mortgagor in accordance with applicable state and
federal law and regulation. This representation is a Deemed Material Breach
Representation; and
(ttt) Second Lien Mortgage Loans. With respect to each Second Lien
Loan: (1) the related First Lien Loan does not permit negative amortization; (2)
where required or customary in the jurisdiction in which the Mortgaged Property
is located, the original lender has filed for record a request for notice of any
action by the related senior lienholder, and the Seller has notified such second
lienholder in writing of the existence of the Second Lien Loan and requested
notification of any action to be taken against the Mortgagor by such senior
lienholder; either (a) no consent for the Second Lien Loan is required by the
holder of the related First Lien Loan or (b) such consent has been obtained and
is contained in the related Mortgage File; (3) to the best of Seller's
knowledge, the related First Lien Loan is in full force and effect, and there is
no default, lien, breach, violation or event which would permit acceleration
existing under such First Lien Loan or Mortgage Note, and 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 which would
permit acceleration under such First Lien Loan; (4) the related first lien
Mortgage contains a provision which provides for giving notice of default or
breach to the mortgagee under the Mortgage Loan and allows such mortgagee to
cure any default under the related first lien Mortgage; and (5) the related
Mortgaged Property is the Mortgagor's principal residence. This representation
is a Deemed Material Breach Representation.
Subsection 9.03 Remedies for Breach of Representations and Warranties.
It is understood and agreed that the representations and warranties
set forth in Subsections 9.01 and 9.02 shall survive the sale of the Mortgage
Loans to the Purchaser 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 Seller or the Purchaser of a breach of any of
the foregoing representations and warranties, the party discovering such breach
shall give prompt written notice to the other.
Within sixty (60) days of the earlier of either discovery by or notice
to the Seller of any breach of a representation or warranty which materially and
adversely affects the value of the Mortgage Loans or the interest of the
Purchaser therein (or which materially and adversely affects the value of the
applicable Mortgage Loan or the interest of the Purchaser therein in the case of
a representation and warranty relating to a particular Mortgage Loan), the
Seller shall use its best efforts promptly to cure such breach in all material
respects and, if such breach cannot be cured, the Seller shall, at the
Purchaser's option, repurchase such Mortgage Loan at the Repurchase Price,
together with all expenses incurred by the Purchaser as a result of such
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repurchase. Notwithstanding the above sentence, (i) within sixty (60) days of
the earlier of either discovery by, or notice to, the Seller of any breach of
the representation or warranty set forth in clause (rr) of Subsection 9.02, the
Seller shall repurchase such Mortgage Loan at the Repurchase Price, together
with all out-of-pocket expenses incurred by the Purchaser as a result of such
repurchase and (ii) any breach of a Deemed Material Breach Representation shall
automatically be deemed to materially and adversely affect the value of the
Mortgage Loan and the interest of the Purchaser therein. In the event that a
breach shall involve any representation or warranty set forth in Subsection
9.01, and (except as provided in the preceding sentence with respect to certain
breaches for which no cure is permitted) such breach cannot be cured within
sixty (60) days of the earlier of either discovery by or notice to the Seller of
such breach, all of the Mortgage Loans shall, at the Purchaser's option, be
repurchased by the Seller at the Repurchase Price, together with all expenses
incurred by the Purchaser as a result of such repurchase. However, if the breach
shall involve a representation or warranty set forth in Subsection 9.02 (other
than the representations and warranties set forth in clause (rr) of such
Subsection or any Deemed Material Breach Representation) and the Seller
discovers or receives notice of any such breach within one hundred twenty (120)
days of the related Closing Date, the Seller shall, at the Purchaser's option
and provided that the Seller has a Qualified Substitute Mortgage Loan, rather
than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan
(a "Deleted Mortgage Loan") and substitute in its place a Qualified Substitute
Mortgage Loan or Loans, provided that any such substitution shall be effected
not later than one hundred twenty (120) days after the related Closing Date. If
the Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the
deficient Mortgage Loan. Any repurchase of a Mortgage Loan or Loans pursuant to
the foregoing provisions of this Subsection 9.03 shall be accomplished by either
(a) if the Interim Servicing Agreement has been entered into and is in effect,
deposit in the Custodial Account of the amount of the Repurchase Price for
distribution to the Purchaser on the next scheduled Remittance Date, 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 or
(b) if the Interim Servicing Agreement has not been entered into or is no longer
in effect, by direct remittance of the Repurchase Price to the Purchaser or its
designee in accordance with the Purchaser's instructions.
At the time of repurchase or substitution, the Purchaser and the
Seller shall arrange for the reassignment of the Deleted Mortgage Loan to the
Seller and the delivery to the Seller of any documents held by the Custodian
relating to the Deleted Mortgage Loan. In the event of a repurchase or
substitution, the Seller shall, simultaneously with such reassignment, give
written notice to the Purchaser that such repurchase or substitution has taken
place, amend the Mortgage Loan Schedule to reflect the withdrawal of the Deleted
Mortgage Loan from this Agreement, and, in the case of substitution, identify a
Qualified Substitute Mortgage Loan and amend the Mortgage Loan Schedule to
reflect the addition of such Qualified Substitute Mortgage Loan to this
Agreement. In connection with any such substitution, the Seller shall be deemed
to have made as to such Qualified Substitute Mortgage Loan the representations
and warranties set forth in this Agreement except that all such representations
and warranties set forth in this Agreement shall be deemed made as of the date
of such substitution. The Seller shall effect such substitution by delivering to
the Custodian or to such other party as the Purchaser may designate in writing
for such Qualified Substitute Mortgage Loan the documents required by Subsection
6.03, with the Mortgage Note endorsed as required by Subsection 6.03. No
substitution will be made in any calendar month after the Determination Date for
such month.
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The Seller shall cause the Interim Servicer to remit directly to the
Purchaser, or its designee in accordance with the Purchaser's instructions the
Monthly Payment less the Servicing Fee due, if any, on such Qualified Substitute
Mortgage Loan or Loans in the month following the date of such substitution.
Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the
month of substitution shall be retained by the Seller. For the month of
substitution, distributions to the Purchaser shall include the Monthly Payment
due on any Deleted Mortgage Loan in the month of substitution, and the Seller
shall thereafter be entitled to retain all amounts subsequently received by the
Seller in respect of such Deleted Mortgage Loan.
For any month in which the Seller substitutes a Qualified Substitute
Mortgage Loan for a Deleted Mortgage Loan, the Seller shall determine the amount
(if any) by which the aggregate principal balance of all Qualified Substitute
Mortgage Loans as of the date of substitution is less than the aggregate Stated
Principal Balance of all Deleted Mortgage Loans (after application of scheduled
principal payments due in the month of substitution). The amount of such
shortfall shall be distributed by the Seller directly to the Purchaser or its
designee in accordance with the Purchaser's instructions within two (2) Business
Days of such substitution.
In addition to such repurchase or substitution obligation, the Seller
shall indemnify the Purchaser and its present and former directors, officers,
employees and agents and any Successor Servicer and its present and former
directors, officers, employees and agents and hold such parties harmless against
any losses, damages, penalties, fines, forfeitures, legal fees and expenses 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 Seller representations and warranties contained in this Agreement
or any Reconstitution Agreement. It is understood and agreed that the
obligations of the Seller set forth in this Subsection 9.03 to cure, substitute
for or repurchase a defective Mortgage Loan and to indemnify the Purchaser and
Successor Servicer as provided in this Subsection 9.03 and Subsection 14.01
constitute the sole remedies of the Purchaser and Successor Servicer respecting
a breach of the foregoing representations and warranties. For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean any Person designated as the
Successor Servicer pursuant to this Agreement and any and all Persons who
previously were "Successor Servicers" pursuant to this Agreement.
Any cause of action against the Seller relating to or arising out of
the breach of any representations and warranties made in Subsections 9.01 and
9.02 shall accrue as to any Mortgage Loan upon (i) discovery of such breach by
the Purchaser or notice thereof by the Seller to the Purchaser, (ii) failure by
the Seller to cure such breach or repurchase such Mortgage Loan as specified
above, and (iii) demand upon the Seller by the Purchaser for compliance with
this Agreement.
Subsection 9.04 Repurchase of Mortgage Loans That Prepay in Full.
If any Mortgage Loan is prepaid within ninety (90) days from and after
the related Closing Date, the Seller shall pay to the Purchaser, within thirty
(30) days of notice from Purchaser, an amount equal to the Premium Percentage
multiplied by the outstanding principal balance of such Mortgage Loan as of the
date of such prepayment in full less any prepayment
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penalty actually received by Purchaser. The Purchaser shall notify and invoice
the Seller of any obligation to remit such premium for such Mortgage Loan
pursuant to this Subsection 9.04 within one hundred eighty (180) days following
the Closing Date for claim to be valid and enforceable; provided that Seller, as
Interim Servicer, has notified Purchaser that such Mortgage Loan prepaid in
Seller's monthly reports in its capacity as interim servicer.
Subsection 9.05 Repurchase of Mortgage Loans with First Payment
Defaults.
(a) If the related Mortgagor is delinquent with respect to the
Mortgage Loan's first Monthly Payment after origination of such Mortgage Loan,
the Seller, at the Purchaser's option exercised in its sole discretion, shall
acknowledge the delinquency and its obligations under this Section 9.05 within
ten (10) days of such Mortgage Loan's delinquency and shall repurchase such
Mortgage Loan from the Purchaser within twenty-five (25) days of such
delinquency at a price equal to the percentage of par as stated in the related
Purchase Price and Terms Agreement (subject to adjustment as provided therein)
multiplied by the then outstanding principal balance of such Mortgage Loan, plus
accrued and unpaid interest thereon from the date to which interest was last
paid through the day prior to the repurchase date at the applicable Mortgage
Interest Rate, plus any outstanding advances owed to any servicer in connection
with such Mortgage Loan.
(b) If the related Mortgagor is delinquent with respect to the
Mortgage Loan's Monthly Payment due in the month in which the related Closing
Date occurs or the Monthly Payment due in the first calendar month following the
month in which the related Closing Date occurs, in each case on its due date,
all in accordance with the terms of the related Mortgage Note, the Seller shall
repurchase such Mortgage Loan from the Purchaser within twenty-five (25) days of
Purchaser's repurchase request at a price equal to the percentage of par as
stated in the related Purchase Price and Terms Agreement (subject to adjustment
as provided therein) multiplied by the then outstanding principal balance of
such Mortgage Loan, plus accrued and unpaid interest thereon from the date to
which interest was last paid through the day prior to the repurchase date at the
applicable Mortgage Interest Rate, plus any outstanding advances owed to any
servicer in connection with such Mortgage Loan.
The Purchaser shall notify and invoice the Seller of any obligation to
repurchase such Mortgage Loan pursuant to this Subsection 9.05 within one
hundred eighty (180) days following the Closing Date for claim to be valid and
enforceable; provided that Seller, as Interim Servicer, properly reported such
delinquency to Purchaser in its monthly reports.
Subsection 9.06 [Reserved].
SECTION 10. Closing.
The closing for the purchase and sale of each Mortgage Loan Package
shall take place on the related Closing Date. At the Purchaser's option, the
Closing shall be either: by telephone, confirmed by letter or wire as the
parties shall agree, or conducted in person, at such place as the parties shall
agree.
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The closing for the Mortgage Loans to be purchased on each Closing
Date shall be subject to each of the following conditions:
(a) at least two (2) Business Days prior to the related Closing Date,
the Seller shall deliver to the Purchaser, in electronic format
acceptable to the Purchaser in its sole discretion, a listing on
a loan-level basis of the necessary information to compute the
Purchase Price of the Mortgage Loans delivered on the Closing
Date (including accrued interest), and prepare a Mortgage Loan
Schedule;
(b) all of the representations and warranties of the Seller under
this Agreement and of the Interim Servicer under the Interim
Servicing Agreement (with respect to each Mortgage Loan for an
interim period, as specified therein) 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 or an Event of Default under the
Interim Servicing Agreement;
(c) the Purchaser shall have received, or the Purchaser's attorneys
shall have received in escrow, all closing documents as specified
in Section 11 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 terms
hereof;
(d) the Seller shall have delivered and released to the Custodian all
documents required pursuant to this Agreement; and
(e) all other terms and conditions of this Agreement and the related
Purchase Price and Terms Agreement shall have been complied with.
Subject to the foregoing conditions, the Purchaser shall pay to the
Seller on the related Closing Date the Purchase Price, plus accrued interest
pursuant to Section 4 of this Agreement, by wire transfer of immediately
available funds to the account designated by the Seller.
SECTION 11. Closing Documents.
The Closing Documents for the Mortgage Loans to be purchased on each
Closing Date shall consist of fully executed originals of the following
documents:
1. this Agreement (to be executed and delivered only for the initial
Closing Date);
2. [Reserved];
3. [Reserved];
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4. the related Mortgage Loan Schedule, segregated by Mortgage Loan
Package;
5. a Custodian's Certification, as required under the Custodial
Agreement, in the form of Exhibit G-1 to the Custodial Agreement
unless such Custodian Certification has not been provided due to
Custodian's default under the Custodial Agreement;
6. [Reserved];
7. [Reserved];
8. with respect to the initial Closing Date, an Officer's
Certificate, in the form of Exhibit C hereto with respect to each
of the Seller and the Interim Servicer, including all attachments
hereto; with respect to subsequent Closing Dates, an Officer's
Certificate upon request of the Purchaser;
9. with respect to the initial Closing Date, an Opinion of Counsel
of each of the Seller and the Interim Servicer (who may be an
employee of the Seller or the Interim Servicer, as applicable),
in the form of Exhibit D hereto ("Opinion of Counsel of the
Seller"); with respect to subsequent Closing Dates, an Opinion of
Counsel of the Seller upon request of the Purchaser;
10. [Reserved];
11. a Security Release Certification, in the form of Exhibit E or F,
as applicable, hereto executed by any person, as requested by the
Purchaser, if any of the Mortgage Loans have at any time been
subject to any security interest, pledge or hypothecation for the
benefit of such person;
12. a certificate or other evidence of merger or change of name,
signed or stamped by the applicable regulatory authority, if any
of the Mortgage Loans were acquired by the Seller by merger or
acquired or originated by the Seller while conducting business
under a name other than its present name, if applicable;
13. with respect to the initial Closing Date, the Underwriting
Guidelines to be attached to the related Assignment and
Conveyance as Exhibit C;
14. Assignment and Conveyance Agreement in the form of Exhibit H
hereto; and
15. Exhibit B to the related Assignment and Conveyance Agreement.
The Seller shall bear the risk of loss of the closing documents until
such time as they are received by the Purchaser or its attorneys.
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SECTION 12. Costs.
The Purchaser shall pay any commissions due its salesmen and the legal
fees and expenses of its attorneys and custodial fees. All other costs and
expenses incurred in connection with the transfer and delivery of the Mortgage
Loans and the Servicing Rights including recording fees, fees for title policy
endorsements and continuations, fees for recording Assignments of Mortgage, and
the Seller's attorney's fees, shall be paid by the Seller.
SECTION 13. Cooperation of Seller with a Reconstitution.
The Seller and the Purchaser agree that with respect to some or all of
the Mortgage Loans, after each Closing Date, on one or more dates (each, a
"Reconstitution Date") at the Purchaser's sole option, the Purchaser may effect
Reconstitution of some or all of the Mortgage Loans then subject to this
Agreement, without recourse, to:
a) Xxxxxx Xxx under its Cash Purchase Program or MBS Program
(Special Servicing Option) (each, a "Xxxxxx Mae Transfer"); or
b) Xxxxxxx Mac (the "Xxxxxxx Mac Transfer"); or
c) one or more third party purchasers in one or more Whole Loan
Transfers; or
d) one or more trusts or other entities to be formed as part of one
or more Securitization Transactions.
The Seller agrees to execute in connection with any Agency Transfer,
any and all reasonably acceptable pool purchase contracts, and/or agreements
among the Purchaser, the Seller, Xxxxxx Xxx or Xxxxxxx Mac (as the case may be)
and any servicer in connection with a Whole Loan Transfer, a seller's warranties
and servicing agreement or a participation and servicing agreement in form and
substance reasonably acceptable to the parties, and in connection with a
Securitization Transaction, a pooling and servicing agreement in form and
substance reasonably acceptable to the parties or an Assignment and Recognition
Agreement substantially in the form attached hereto as Exhibit J (collectively,
the agreements referred to herein are designated, the "Reconstitution
Agreements"), together with an opinion of counsel with respect to such
Reconstitution Agreements.
With respect to each Whole Loan Transfer and each Securitization
Transfer entered into by the Purchaser, the Seller agrees (1) to cooperate fully
with the Purchaser and any prospective purchaser with respect to all reasonable
requests and due diligence procedures; (2) to execute, deliver and perform all
Reconstitution Agreements required by the Purchaser; (3) to restate the
representations and warranties set forth in this Agreement and the Interim
Servicing Agreement as of the related Reconstitution Date (or, with respect to
the Servicing Transfer Representations, the Transfer Date) or make the
representations and warranties set forth in the related selling/servicing guide
of the servicer or issuer, as the case may be, or such representations or
warranties as may be required by any Rating Agency or prospective purchaser of
the related securities or such Mortgage Loans, in connection with such
Reconstitution
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provided, however, that Purchaser provides notice of any such additional
representation (in addition to, and other than in, the assignment, assumption
and recognition agreement) and that any such representations and/or warranties
shall not conflict with the representations and warranties made by the Seller in
this Agreement and shall not in any event materially expand or increase the
duties, obligations and/or liabilities of Seller beyond the duties, obligations
and liabilities agreed to by Seller in this Agreement without the written
consent of Seller (which shall not be unreasonably withheld). The Seller shall
provide to such servicer or issuer, as the case may be, and any other
participants or purchasers in such Reconstitution: (i) any and all information
and appropriate verification of information which may be reasonably available to
the Seller or its affiliates, whether through letters of its auditors and
counsel or otherwise, as the Purchaser or any such other participant shall
request; and (ii) such additional representations, warranties, covenants,
opinions of counsel, letters from auditors, and certificates of public officials
or officers of the Seller or the Interim Servicer as are reasonably believed
necessary by the Purchaser or any such other participant provided, however, that
Purchaser provides notice of any such additional representation (in addition to,
and other than in, the assignment, assumption and recognition agreement) and
that any such representations and/or warranties shall not conflict with the
representations and warranties made by the Seller in this Agreement and shall
not in any event materially expand or increase the duties, obligations and/or
liabilities of Seller beyond the duties, obligations and liabilities agreed to
by Seller in this Agreement without the written consent of Seller (which shall
not be unreasonably withheld); and (iii) to execute, deliver and satisfy all
conditions set forth in any indemnity agreement required by the Purchaser or any
such participant, including, without limitation, an Indemnification and
Contribution Agreement in substantially the form attached hereto as Exhibit K.
Moreover, the Seller agrees to cooperate with all reasonable requests made by
the Purchaser to effect such Reconstitution Agreements. The Seller shall
indemnify the Purchaser, each affiliate of the Purchaser participating in the
Reconstitution and each Person who controls the Purchaser or such affiliate and
their respective present and former directors, officers, employees and agents,
and 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 each of them may sustain in any way
related to any information provided by or on behalf of the Seller regarding the
Seller, the Seller's servicing practices or performance, the Mortgage Loans or
the Underwriting Guidelines set forth in any offering document prepared in
connection with any Reconstitution. For purposes of the previous sentence,
"Purchaser" shall mean the Person then acting as the Purchaser under this
Agreement and any and all Persons who previously were "Purchasers" under this
Agreement.
In the event the Purchaser has elected to have the Interim Servicer or
the Seller hold record title to the Mortgages, prior to the Reconstitution Date,
the Interim Servicer or the Seller shall prepare an assignment of mortgage in
blank or to the prospective purchaser or trustee, as applicable, from the
Interim Servicer or the Seller, as applicable, acceptable to the prospective
purchaser or trustee, as applicable, for each Mortgage Loan that is part of the
Reconstitution and shall pay all preparation and recording costs associated
therewith. In connection with the Reconstitution, the Interim Servicer shall
execute or shall cause the Seller to execute each Assignment of Mortgage (except
with respect to each MERS Designated Mortgage Loan), track such Assignments of
Mortgage to ensure they have been recorded and deliver them as required by the
prospective purchaser or trustee, as applicable, upon the Interim Servicer's
receipt thereof. Additionally, the Interim Servicer shall prepare and execute or
shall cause the
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Seller to execute, at the direction of the Purchaser, any note endorsement in
connection with any and all seller/servicer agreements.
All Mortgage Loans not sold or transferred pursuant to a
Reconstitution shall remain subject to this Agreement and, if the Interim
Servicing Agreement shall remain in effect with respect to the related Mortgage
Loan Package, shall continue to be serviced in accordance with the terms of this
Agreement and the Interim Servicing Agreement and with respect thereto this
Agreement shall remain in full force and effect.
SECTION 14. The Seller.
Subsection 14.01 Additional Indemnification by the Seller; Third Party
Claims.
(a) The Seller shall indemnify the Purchaser and its present and
former directors, officers, employees and agents and any Successor Servicer and
its present and former directors, officers, employees and agents, and hold such
parties harmless against any and all claims, losses, damages, penalties, fines,
forfeitures, legal fees (including legal fees incurred in connection with the
enforcement of the Seller's indemnification obligation under this Section 14.01)
and related costs, judgments, and any other costs, fees and expenses that such
parties may sustain in any way related to the failure of the Seller to perform
its duties and the Interim Servicer to service the Mortgage Loans in strict
compliance with the terms of this Agreement or any Reconstitution Agreement
entered into pursuant to Section 13 or any breach of any of Seller's
representations, warranties and covenants set forth in this Agreement (provided
that such costs shall not include any lost profits). For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean any Person designated as the
Successor Servicer pursuant to this Agreement and any and all Persons who
previously were "Successor Servicers" pursuant to this Agreement.
(b) Promptly after receipt by an indemnified party under this Section
14.01 of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party under
this Section 14.01, notify the indemnifying party in writing of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
the indemnifying party from any liability which it may have to any indemnified
party under this Section 14.01, except to the extent that it has been prejudiced
in any material respect, or from any liability which it may have, otherwise than
under this Section 14.01. In case any such action is brought against any
indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein, and to
the extent that it may elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice from such indemnified party,
to assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party; provided that if the defendants in any such action include
both the indemnified party and the indemnifying party and the indemnified party
or parties shall have reasonably concluded that there may be legal defenses
available to it or them and/or other indemnified parties which 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
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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 counsel, the indemnifying party
will not be liable to such indemnified party for expenses incurred by the
indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in connection with the
assertion of legal defenses in accordance with the proviso to the next preceding
sentence (it being understood, however, that the indemnifying party shall not be
liable for the expenses of more than one separate counsel (together with one
local counsel, if applicable)), (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 has authorized in writing the
employment of counsel for the indemnified party at the expense of the
indemnifying party; and except that, if clause (i) or (iii) is applicable, such
liability shall be only in respect of the counsel referred to in such clause (i)
or (iii).
Subsection 14.02 Merger or Consolidation of the Seller.
The Seller will keep in full effect its existence, rights and
franchises as a corporation under the laws of the state of its incorporation
except as permitted herein, and will obtain and preserve its qualification to do
business as a foreign corporation 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.
Any Person into which the Seller may be merged or consolidated, or any
corporation resulting from any merger, conversion or consolidation to which the
Seller shall be a party, or any Person succeeding to the business of the Seller,
shall be the successor of the Seller 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
successor or surviving Person shall have a net worth of at least $10,000,000.
SECTION 15. Financial Statements.
The Seller understands that in connection with the Purchaser's
marketing of the Mortgage Loans, the Purchaser shall make available to
prospective purchasers audited financial statements of the Seller's parent
company and unaudited financial statements of the Seller for the most recently
completed three (3) fiscal years respecting which such statements are available,
as well as a Consolidated Statement of Condition of the Seller at the end of the
last two (2) fiscal years covered by such Consolidated Statement of Operations.
The Seller shall also make available any comparable interim statements to the
extent any such statements have been prepared by the Seller (and are available
upon request to members or stockholders of the Seller or the public at large).
The Seller, if it has not already done so, agrees to furnish promptly to the
Purchaser copies of the statements specified above. The Seller shall also make
available information on its servicing performance with respect to loans
serviced for others, including delinquency ratios.
The Seller also agrees to allow reasonable access to a knowledgeable
financial or accounting officer for the purpose of answering questions asked by
any prospective purchaser
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regarding recent developments affecting the Seller or the financial statements
of the Seller to the extent such information is public information.
SECTION 16. Mandatory Delivery; Grant of Security Interest.
The sale and delivery on the related Closing Date of the Mortgage
Loans described on the related Mortgage Loan Schedule is mandatory from and
after the date of the execution of the related Purchase Price and Terms
Agreement, it being specifically understood and agreed that each Mortgage Loan
is unique and identifiable on the date hereof and that an award of money damages
would be insufficient to compensate the Purchaser for the losses and damages
incurred by the Purchaser (including damages to prospective purchasers of the
Mortgage Loans) in the event of the Seller's failure to deliver (i) each of the
related Mortgage Loans or (ii) one or more Qualified Substitute Mortgage Loans
or (iii) one or more Mortgage Loans otherwise acceptable to the Purchaser on or
before the related Closing Date. The Seller hereby grants to the Purchaser a
lien on and a continuing security interest in each Mortgage Loan and each
document and instrument evidencing each such Mortgage Loan to secure the
performance by the Seller of its obligations under the related Purchase Price
and Terms Agreement, and the Seller agrees that it shall hold such Mortgage
Loans in custody for the Purchaser subject to the Purchaser's (i) right to
reject any Mortgage Loan (or Qualified Substitute Mortgage Loan) under the terms
of this Agreement and to require another Mortgage Loan (or Qualified Substitute
Mortgage Loan) to be substituted therefor, and (ii) obligation to pay the
Purchase Price for the Mortgage Loans. All rights and remedies of the Purchaser
under this Agreement are distinct from, and cumulative with, any other rights or
remedies under this Agreement or afforded by law or equity and all such rights
and remedies may be exercised concurrently, independently or successively.
SECTION 17. Notices.
All demands, notices and communications hereunder shall be in writing
and shall be given via email, facsimile transmission or registered or certified
mail to the person at the address set forth below:
(i) if to the Seller:
First Horizon Home Loan Corporation
0000 Xxxxxxx Xxxxxxxxx
Xxxxxxxx Xxxx, Xxxxxx, 00000
Attention: Xxxx Xxxxx
Fax: (000) 000-0000
Phone: (000) 000-0000
Email: xxxxxxxxxxx@xxxxxxxxxxxx.xxx
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(ii) if to the Purchaser:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx Xxxxxxxx
Fax: (000)-000-0000
Email: x.xxxxxxxx@xxxxxx.xxx
with a copy to:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Fax: (000)-000-0000
Email: xxxxxx.xxxxx@xxxxxx.xxx
or such other address as may hereafter be furnished to the other party by like
notice. Any such demand, notice or communication hereunder shall be deemed to
have been received on the date delivered to or received at the premises of the
addressee (as evidenced, in the case of registered or certified mail, by the
date noted on the return receipt).
SECTION 18. Severability Clause.
Any part, provision representation or warranty of this Agreement which
is prohibited or unenforceable or is held to be void or unenforceable in any
jurisdiction shall be ineffective, as to such jurisdiction, to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction as to any Mortgage Loan shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by applicable law, the parties hereto waive any provision of law which prohibits
or renders void or unenforceable any provision hereof. If the invalidity of any
part, provision, representation or warranty of this Agreement shall deprive any
party of the economic benefit intended to be conferred by this Agreement, the
parties shall negotiate, in good-faith, to develop a structure the economic
effect of which is nearly as possible the same as the economic effect of this
Agreement without regard to such invalidity.
SECTION 19. Counterparts.
This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original, and all such
counterparts shall constitute one and the same instrument.
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SECTION 20. Governing Law Jurisdiction; Consent to Service of Process.
THIS AGREEMENT SHALL BE DEEMED IN EFFECT WHEN A FULLY EXECUTED
COUNTERPART THEREOF IS RECEIVED BY THE PURCHASER IN THE STATE OF NEW YORK AND
SHALL BE DEEMED TO HAVE BEEN MADE IN THE STATE OF NEW YORK. THIS AGREEMENT SHALL
BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT
TO ITS CHOICE OF LAW RULES AND PRINCIPLES. EACH OF THE PURCHASER AND THE SELLER
IRREVOCABLY (I) SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE
STATE OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE
SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT; (II) WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW,
THE DEFENSE OF AN INCONVENIENT FORUM IN ANY ACTION OR PROCEEDING IN ANY SUCH
COURT; (III) AGREES THAT A FINAL JUDGMENT IN ANY ACTION OR PROCEEDING IN ANY
SUCH COURT SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW; AND (IV) CONSENTS
TO SERVICE OF PROCESS UPON IT BY MAILING A COPY THEREOF BY CERTIFIED MAIL
ADDRESSED TO IT AS PROVIDED FOR NOTICES HEREUNDER.
SECTION 21. Intention of the Parties.
It is the intention of the parties that the Purchaser is purchasing,
and the Seller is selling the Mortgage Loans and not a debt instrument of the
Seller or another security. Accordingly, the parties hereto each intend to treat
the transaction for Federal income tax purposes as a sale by the Seller, and a
purchase by the Purchaser, of the Mortgage Loans. Moreover, the arrangement
under which the Mortgage Loans are held shall be consistent with classification
of such arrangement as a grantor trust in the event it is not found to represent
direct ownership of the Mortgage Loans. The Purchaser shall have the right to
review the Mortgage Loans and the related Mortgage Loan Files to determine the
characteristics of the Mortgage Loans which shall affect the Federal income tax
consequences of owning the Mortgage Loans and the Seller shall cooperate with
all reasonable requests made by the Purchaser in connection with the review of
such tax consequences. Regardless of such review, provided that Seller shall
have reasonably cooperated on such review, Seller shall have no obligation to
either repurchase such Mortgage Loan or indemnify Purchaser for such Mortgage
Loan in the event there is an adverse tax consequence to Seller, except as
specifically provided herein.
SECTION 22. Successors and Assigns; Assignment of Purchase Agreement.
This Agreement shall bind and inure to the benefit of and be
enforceable by the Seller and the Purchaser and the respective permitted
successors and assigns of the Seller and the successors and assigns of the
Purchaser. This Agreement shall not be assigned, pledged or hypothecated by the
Seller to a third party without the prior written consent of the Purchaser,
which consent may be withheld by the Purchaser in its sole discretion. This
Agreement may be assigned, pledged or hypothecated by the Purchaser in whole or
in part, and with respect to one
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or more of the Mortgage Loans, without the consent of the Seller. There shall be
no limitation on the number of assignments or transfers allowable by the
Purchaser with respect to the Mortgage Loans and this Agreement. In the event
the Purchaser assigns this Agreement, and the assignee assumes any of the
Purchaser's obligations hereunder, the Seller acknowledges and agrees to look
solely to such assignee, and not to the Purchaser, for performance of the
obligations so assumed and the Purchaser shall be relieved from any liability to
the Seller with respect thereto.
SECTION 23. Waivers.
No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced.
SECTION 24. Exhibits.
The exhibits to this Agreement are hereby incorporated and made a part
hereof and are an integral part of this Agreement.
SECTION 25. General Interpretive 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) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;
(c) 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;
(d) 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;
(e) 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
(f) the term "include" or "including" shall mean without limitation by
reason of enumeration.
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SECTION 26. Reproduction of Documents.
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications which may hereafter be
executed, (b) documents received by any party at the closing, and (c) financial
statements, certificates and other information previously or hereafter
furnished, may be reproduced by any photographic, photostatic, microfilm,
micro-card, miniature photographic or other similar process. The parties agree
that any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding, whether or not the original
is in existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
SECTION 27. Further Agreements.
The Seller and the Purchaser each agree to execute and deliver to the
other such reasonable and appropriate additional documents, instruments or
agreements as may be necessary or appropriate to effectuate the purposes of this
Agreement.
SECTION 28. Recordation of Assignments of Mortgage.
To the extent permitted by applicable law, each of the Assignments of
Mortgage is subject to recordation in all appropriate public offices for real
property records in all the counties or their comparable jurisdictions in which
any or all of the Mortgaged Properties are situated, and in any other
appropriate public recording office or elsewhere, such recordation to be
effected at the Seller's expense in the event recordation is either necessary
under applicable law or requested by the Purchaser at its sole option (other
than with respect to the MERS Designated Mortgage Loans).
SECTION 29. No Solicitation.
From and after the Closing Date, the Seller agrees that it will not
take any action or permit or cause any action to be taken by any of its agents
or affiliates, or by any independent contractors on the Seller's behalf, to
personally, by telephone or mail (via electronic means or otherwise), solicit
the borrower or obligor under any Mortgage Loan for any purpose whatsoever
related to such Mortgage Loan, including to refinance a Mortgage Loan, in whole
or in part, without the prior written consent of the Purchaser. It is understood
and agreed that all rights and benefits relating to the solicitation of any
Mortgagors and the attendant rights, title and interest in and to the list of
such Mortgagors and data relating to their Mortgages (including insurance
renewal dates) shall be transferred to the Purchaser pursuant hereto on the
Closing Date and the Seller shall take no action to undermine these rights and
benefits. Notwithstanding the foregoing, it is understood and agreed that
promotions undertaken by the Seller or any affiliate of the Seller which are
directed to the general public at large, including, without limitation, mass
mailing based on commercially acquired mailing lists, newspaper, radio and
television advertisements shall not constitute solicitation under this Section
29.
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SECTION 30. Waiver of Trial by Jury.
THE SELLER AND THE PURCHASER EACH KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR RELATING TO THIS
AGREEMENT.
SECTION 31. Compliance with Regulation AB
Subsection 31.01 Intent of the Parties; Reasonableness.
The Purchaser and the Seller acknowledge and agree that the purpose of
Section 31 of this Agreement 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 Seller 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 Seller 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 Seller 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 Seller, 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.
The Purchaser (including any of its assignees or designees) shall
cooperate with the Seller 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.
Subsection 31.02 Additional Representations and Warranties of the
Seller.
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(a) The Seller shall be deemed to represent to the Purchaser and to
any Depositor, as of the date on which information is first provided to the
Purchaser or any Depositor under Subsection 31.03 that, except as disclosed in
writing to the Purchaser or such Depositor prior to such date: (i) the Seller 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 Seller; (ii) the Interim Servicer 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; (iii) no material noncompliance with the applicable servicing
criteria with respect to other securitizations of residential mortgage loans
involving the Interim Servicer as servicer has been disclosed or reported by the
Seller; (iv) no material changes to the Interim Servicer's policies or
procedures with respect to the servicing function it will perform under the
Interim Servicing 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; (v) there
are no aspects of the Interim Servicer's financial condition that could have a
material adverse effect on the performance by the Interim Servicer of its
servicing obligations under the Interim Servicing Agreement or any
Reconstitution Agreement; (vi) there are no material legal or governmental
proceedings pending (or known to be contemplated) against the Seller, Interim
Servicer, any Subservicer or any Third Party Originator; and (vii) there are no
affiliations, relationships or transactions relating to the Seller, Interim
Servicer, 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 or any Depositor on any date
following the date on which information is first provided to the Purchaser or
any Depositor under Subsection 31.03, the Seller shall, within five (5) Business
Days following such request, confirm in writing the accuracy of the
representations and warranties set forth in paragraph (a) of this Section 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.
Subsection 31.03 Information To Be Provided by the Seller.
In connection with any Securitization Transaction the Seller shall (i)
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 to provide), in writing and in form and substance
reasonably satisfactory to the Purchaser and such Depositor, the information and
materials specified in paragraphs (a) and (b) of this Section, and (ii) as
promptly as practicable following notice to or discovery by the Seller, 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 (d) of this Section.
(a) If so requested by the Purchaser or any Depositor, the Seller
shall provide such information regarding (i) the Seller, as originator of the
Mortgage Loans (including as an acquirer of Mortgage Loans from a Qualified
Correspondent), or (ii) each Third Party Originator, 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) the originator's form of organization;
(B) 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 or any Depositor, 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;
(C) a description of any material legal or governmental proceedings
pending (or known to be contemplated) against the Seller and each Third Party
Originator; and
(D) a description of any affiliation or relationship between the
Seller, each Third Party Originator and any of the following parties to a
Securitization Transaction, as such parties are identified to the Seller by the
Purchaser or any Depositor in writing in advance of such Securitization
Transaction:
(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.
(b) If so requested by the Purchaser or any Depositor, to the extent
required by Regulation AB, the Seller shall provide (or, as applicable, cause
each Third Party Originator to provide), to the extent available to the Seller
or such Third-Party Originator (and not otherwise available to the Purchaser)
without unreasonable effort or expense, 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 (i) the Seller, if
the Seller is an originator of Mortgage Loans (including as an acquirer of
Mortgage Loans from a Qualified Correspondent), and/or (ii) each Third Party
Originator. Such Static Pool Information shall be prepared by the Seller (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
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available to the Seller (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 Seller, 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 one
hundred thirty-five (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. The
Purchaser agrees that it will cooperate with the Seller and provide sufficient
and timely notice of any information requirement pertaining to a Securitization
Transaction. The Purchaser will make all reasonable efforts to contain requests
for information, reports or any other materials to items required for compliance
with Regulation AB, and will refrain from requesting information that is not
required for such compliance. The Seller shall use commercially reasonable
efforts to provide the Static Pool Information required hereunder; provided,
however, that failure of the Seller to perform such obligations, after applying
commercially reasonable efforts, shall not result in a breach by the Seller of
the provisions of this Agreement.
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 Seller 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
Seller.
If so requested by the Purchaser or any Depositor, the Seller 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 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
Seller'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 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.
(c) With respect to those Mortgage Loans that were sold to the
Purchaser pursuant to this Agreement, the Purchaser shall provide or cause the
servicer (or another party)
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to be obligated to provide information, upon request by Seller in the form
customarily provided by the Purchaser, the servicer or such other party (which
need not be customized for the Seller) with respect to the Mortgage Loans
reasonably necessary for the Seller to comply with its obligations under
Regulation AB, including, without limitation, providing to the Seller Static
Pool Information, as set forth in Item 1105(a)(2) and (3) of Regulation AB (such
information provided by the Purchaser, the servicer or such other party, the
"Loan Performance Data"). The Purchaser shall, or shall cause the servicer (or
another party) to be obligated to, indemnify the Seller for 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 (A) any untrue statement of a material fact
contained or alleged to be contained in the Loan Performance Data or (B) the
omission or alleged omission to state in the Loan Performance Data a material
fact required to be stated therein 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 Loan Performance Data.
(d) 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 Seller shall (or shall cause each
Third Party Originator to) (i) notify the Purchaser and any Depositor in writing
of (A) any material litigation or governmental proceedings pending against the
Seller or any Third Party Originator and (B) any affiliations or relationships
that develop following the closing date of a Securitization Transaction between
the Seller or any Third Party Originator and any of the parties specified in
clause (D) of paragraph (a) of this Section (and any other parties identified in
writing by the requesting party) with respect to such Securitization
Transaction, and (ii) provide to the Purchaser and any Depositor a description
of such proceedings, affiliations or relationships.
Subsection 31.04 Indemnification; Remedies.
(a) The Seller shall indemnify the Purchaser, each affiliate of the
Purchaser, the Depositor, 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:
(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 this
Section 31 by or on behalf of the Seller, or provided under this Section 31
by or on behalf of any Third Party Originator
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(collectively, the "Seller Information"), or (B) the omission or alleged
omission to state in the Seller Information a material fact required to be
stated in the Seller 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 Seller
Information and not to any other information communicated in connection
with a sale or purchase of securities, without regard to whether the Seller
Information or any portion thereof is presented together with or separately
from such other information;
(ii) any failure by the Seller or any Third Party Originator to
deliver any information, report, certification, accountants' letter or
other material when and as required under this Section 31; or
(iii) any breach by the Seller of a representation or warranty set
forth in Subsection 31.02(a) or in a writing furnished pursuant to
Subsection 31.02(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 Seller of a representation
or warranty in a writing furnished pursuant to Subsection 31.02(b) to the
extent made as of a date subsequent to such closing date.
In the case of any failure of performance described in clause (a)(ii)
of this Section, the Seller 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 Seller or
any Third Party Originator.
(b) (i) Any failure by the Seller or any Third Party Originator to
deliver any information, report, certification, accountants' letter or other
material when and as required under this Section 31, or any breach by the Seller
of a representation or warranty set forth in Subsection 31.02(a) or in a writing
furnished pursuant to Subsection 31.02(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 Seller of a
representation or warranty in a writing furnished pursuant to Subsection
31.02(b) to the extent made as of a date subsequent to such closing date, shall
immediately and automatically, without notice or grace period, constitute an
Event of Default with respect to the Seller 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 Interim Servicer as servicer under the Interim Servicing
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 Interim Servicer; 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 Interim Servicer as servicer, such
provision shall be given effect.
-60-
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
-61-
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed hereto by their respective officers thereunto duly authorized
as of the date first above written.
IXIS REAL ESTATE CAPITAL INC.
(Purchaser)
By: /s/ Xxxxx Xxxxx
------------------------------------
Name: Xxxxx Xxxxx
Title: Director
By: /s/ F. Xxxx Xxxxxx
------------------------------------
Name: F. Xxxx Xxxxxx
Title: Managing Director
FIRST HORIZON HOME LOAN CORPORATION
(Seller)
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title: Vice President
Exhibit A
EXHIBIT A
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 delivered to the
Custodian, or to such other Person as the Purchaser shall designate in writing,
pursuant to Section 6 of the Second Amended and Restated Mortgage Loan Purchase
and Warranties Agreement to which this Exhibit is attached (the "Agreement"):
(a) the original Mortgage Note bearing all intervening endorsements
evidencing a complete chain of assignment from the originator to the Seller,
endorsed "Pay to the order of _________, without recourse" and signed in the
name of the Seller by an authorized officer. The endorsement may be contained on
an allonge, if state law so allows. If the Mortgage Loan was acquired by the
Seller in a merger, the endorsement must be by "[Seller], successor by merger to
[name of predecessor]." If the Mortgage Loan was acquired or originated by the
Seller while doing business under another name, the endorsement must be by
"[Seller], formerly known as [previous name]";
(b) if applicable, the original of any guarantee executed in
connection with the Mortgage Note;
(c) the original Mortgage with evidence of recording thereon. If in
connection with any Mortgage Loan, the Seller 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 Seller shall deliver or cause to be delivered to the
Custodian, (i) a Seller certified photocopy of such Mortgage; 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 to be a true and complete copy of the original recorded Mortgage;
(d) the originals of all assumption, modification, consolidation or
extension agreements, if any, with evidence of recording thereon;
(e) except with respect to each MERS Designated Mortgage Loan, the
original Assignment of Mortgage for each Mortgage Loan, in form and substance
acceptable for recording. The Assignment of Mortgage must be duly recorded only
if recordation is either necessary under applicable law or commonly required by
private institutional mortgage investors in the area where the Mortgaged
Property is located or on direction of the Purchaser as provided in this
Agreement. If the Assignment of Mortgage is to be recorded, the Mortgage shall
be assigned to the Purchaser. If the Assignment of Mortgage is not to be
recorded, the Assignment of Mortgage shall be delivered in blank. If the
Mortgage Loan was acquired by the Seller in a
A-1
merger, the Assignment of Mortgage must be made by "[Seller], successor by
merger to [name of predecessor]". If the Mortgage Loan was acquired or
originated by the Seller while doing business under another name, the Assignment
of Mortgage must be by "[Seller], formerly known as [previous name]";
(f) the originals of all intervening assignments of mortgage,
evidencing a complete chain of assignment from the originator to the Seller (or
MERS with respect to each MERS Designated Mortgage Loan), 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
Seller shall deliver or cause to be delivered to the Custodian, (i) a Seller
certified photocopy of such intervening assignment; 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;
(g) The original mortgagee policy of title insurance or, in the event
such original title policy is unavailable, a certified true copy of the related
policy binder or commitment for title certified to be true and complete by the
title insurance company; and
(h) security agreement, chattel mortgage or equivalent document
executed in connection with the Mortgage.
In the event an Officer's Certificate of the Seller is delivered to
the Purchaser because of a delay caused by the public recording office in
returning any recorded document, the Seller shall deliver to the Purchaser,
within ninety (90) days of the Closing Date, an Officer's Certificate which
shall (i) identify the recorded document and (ii) state that the recorded
document has not been delivered to the Custodian due solely to a delay caused by
the public recording office; provided, however, that any recorded document shall
in any event be delivered no later than one (1) year from the applicable Closing
Date. An extension of the date specified in (iv) above may be requested from the
Purchaser, which consent shall not be unreasonably withheld.
A-2
Exhibit B
EXHIBIT B
FORM OF INTERIM SERVICING AGREEMENT
B-1
Exhibit C
EXHIBIT C
FORM OF SELLER'S OFFICER'S CERTIFICATE
I, ____________________, hereby certify that I am the duly elected
[Vice] President of First Horizon Home Loan Corporation, a corporation organized
under the laws of the state of Kansas (the "Company"), and further as follows:
1. Attached hereto as Exhibit 1 is a true, correct and complete copy
of the charter of the Company which is in full force and effect on the date
hereof and which has been in effect without amendment, waiver, rescission
or modification since ___________.
2. Attached hereto as Exhibit 2 is a true, correct and complete copy
of the bylaws of the Company which are in effect on the date hereof and
which have been in effect without amendment, waiver, rescission or
modification since ___________.
3. Attached hereto as Exhibit 3 is an original certificate of good
standing of the Company issued within ten (10) days of the date hereof, and
no event has occurred since the date thereof which would impair such
standing.
4. Attached hereto as Exhibit 4 is a true, correct and complete copy
of the corporate resolutions of the Board of Directors of the Company
authorizing the Company to execute and deliver each of the Second Amended
and Restated Mortgage Loan Purchase and Warranties Agreement, dated as of
July 1, 2006, by and between IXIS Real Estate Capital Inc. (the
"Purchaser") and the Company (the "Purchase Agreement"), and the Amended
and Restated Interim Servicing Agreement, dated as of October 1, 2005, by
and between the Company and the Purchaser (the "Interim Servicing
Agreement") and to endorse the Mortgage Notes and execute the Assignments
of Mortgages by original [or facsimile] signature, and such resolutions are
in effect on the date hereof and have been in effect without amendment,
waiver, rescission or modification since ____________.
5. 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 Purchase Agreement or the Interim Servicing Agreement, the sale of
the mortgage loans or the consummation of the transactions contemplated by
the agreements; or (ii) any required consent, approval, authorization or
order has been obtained by the Company.
6. Neither the consummation of the transactions contemplated by, nor
the fulfillment of the terms of the Purchase Agreement or the Interim
Servicing Agreement conflicts or will conflict with or results 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 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.
C-1
7. There is no action, suit, proceeding or investigation pending or
threatened against the Company which, in my judgment, 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 Purchase Agreement or the Interim Servicing
Agreement, or the mortgage loans 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 Purchase Agreement or the Interim Servicing Agreement.
8. Each person listed on Exhibit 5 attached hereto who, as an officer
or representative of the Company, signed (a) the Purchase Agreement, (b)
the Interim Servicing Agreement and (c) any other document delivered or on
the date hereof in connection with any purchase described in the agreements
set forth above was, at the respective times of such signing and delivery,
and is now, a duly elected or appointed, qualified and acting officer or
representative of the Company, who holds the office set forth opposite his
or her name on Exhibit 5, and the signatures of such persons appearing on
such documents are their genuine signatures.
9. The Company is duly authorized to engage in the transactions
described and contemplated in the Purchase Agreement and the Interim
Servicing Agreement.
C-2
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the
seal of the Company.
Dated: ____________________ By:
------------------------------------
Name:
------------------------------
[Seal] Title: [Vice] President
I, ________________________, an [Assistant] Secretary of First Horizon
Home Loan Corporation, hereby certify that ____________ is the duly elected,
qualified and acting [Vice] President of the Company and that the signature
appearing above is [her] [his] genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated: ____________________ By:
------------------------------------
Name:
------------------------------
Title: [Assistant] Secretary
C-3
Exhibit C
EXHIBIT 5 to
Company's Officer's Certificate
NAME TITLE SIGNATURE
------------------------ ------------------------- -------------------------
________________________ _________________________ _________________________
________________________ _________________________ _________________________
________________________ _________________________ _________________________
________________________ _________________________ _________________________
________________________ _________________________ _________________________
________________________ _________________________ _________________________
C-4
Exhibit D
EXHIBIT D
FORM OF OPINION OF COUNSEL TO THE SELLER
AND INTERIM SERVICER (DATE)
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
You have requested [our] [my] opinion, as [Assistant] General Counsel
to First Horizon Home Loan Corporation (the "Company"), with respect to certain
matters in connection with the sale by the Company of the Mortgage Loans
pursuant to that certain Second Amended and Restated Mortgage Loan Purchase and
Warranties Agreement by and between the Company and IXIS Real Estate Capital
Inc. (the "Purchaser"), dated as of July 1, 2006 (the "Purchase Agreement")
which sale is in the form of whole loans and serviced pursuant to an Amended and
Restated Interim Servicing Agreement, dated as of October 1, 2005 by and between
First Horizon Home Loan Corporation (the Interim Servicer) and the Purchaser
(the "Interim Servicing Agreement" and, collectively with the Purchase
Agreement, the "Agreements"). Capitalized terms not otherwise defined herein
have the meanings set forth in the Purchase Agreement and the Interim Servicing
Agreement.
[We][I] have examined the following documents:
1. the Purchase Agreement;
2. the Interim Servicing Agreement;
3. the form of Assignment of Mortgage;
4. the form of endorsement of the Mortgage Notes; and
5. such other documents, records and papers as we have deemed
necessary and relevant as a basis for this opinion.
To the extent [we] [I] have deemed necessary and proper, [we] [I] have
relied upon the representations and warranties of the Company and the Interim
Servicer contained in the Purchase Agreement and in the Interim Servicing
Agreement, as applicable. [We] [I] have assumed the authenticity of all
documents submitted to [us] [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 [our] [my] opinion that:
1. The Company and the Interim Servicer is [type of entity] duly
organized, validly existing and in good standing under the laws of the
[United States] and are
D-1
qualified to transact business in, and is in good standing under, the
laws of [the state of incorporation].
2. Each of the Company and the Interim Servicer has the power to engage
in the transactions contemplated by the Agreements to which it is a
party and all requisite power, authority and legal right to execute
and deliver such Agreements and to perform and observe the terms and
conditions of such Agreements.
3. Each of the Agreements to which it is a party has been duly
authorized, executed and delivered by the Company and the Interim
Servicer, as applicable, and is a legal, valid and binding agreement
enforceable in accordance with its respective terms against the
Company and the Interim Servicer, as applicable, subject to bankruptcy
laws and other similar laws of general application affecting rights of
creditors 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.
4. Each of the Company and the Interim Servicer has been duly authorized
to allow any of its officers to execute any and all documents by
original signature in order to complete the transactions contemplated
by the Agreements to which it is a party by original [or facsimile]
signature in order to execute the endorsements to the Mortgage Notes
and the Assignments of Mortgages, and the original [or facsimile]
signature of the officer at the Company executing the endorsements to
the Mortgage Notes and the Assignments of Mortgages represents the
legal and valid signature of said officer of the Company.
5. 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 or the Interim Servicer of or
compliance by the Company or the Interim Servicer with the Agreements
to which it is a party and the sale of the Mortgage Loans by the
Company or the consummation of the transactions contemplated by the
Agreements to which each is a party or (ii) any required consent,
approval, authorization or order has been obtained by the Company or
the Interim Servicer.
6. Neither the consummation of the transactions contemplated by, nor the
fulfillment of the terms of, the Agreements to which it is a party
conflicts or will conflict with or results or will result in a breach
of or constitutes or will constitute a default under the charter,
by-laws or other organizational documents of the Company or the
Interim Servicer, as applicable, the terms of any indenture or other
agreement or instrument to which the Company or the Interim Servicer
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 or the Interim Servicer is subject or by which it is
bound.
D-2
7. There is no action, suit, proceeding or investigation pending or, to
my knowledge, threatened against the Company or the Interim Servicer
which, in [our] [my] judgment, 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 the Interim Servicer or in any material impairment of the right or
ability of the Company or the Interim Servicer to carry on its
business substantially as now conducted or in any material liability
on the part of the Company or the Interim Servicer or which would draw
into question the validity of the Agreements to which it is a party or
the Mortgage Loans or of any action taken or to be taken in connection
with the transactions contemplated thereby, or which would be likely
to impair the ability of the Company or the Interim Servicer to
perform under the terms of the Agreements to which it is a party.
8. The sale of each Mortgage Note and Mortgage as and in the manner
contemplated by the Agreements is sufficient to fully transfer to the
Purchaser all right, title and interest of the Company thereto as
noteholder and mortgagee.
9. The Mortgages have been duly assigned and the Mortgage Notes have been
duly endorsed as provided in the Purchase Agreement. The Assignments
of Mortgage are in recordable form, except for the insertion of the
name of the assignee, and upon the name of the assignee being
inserted, are acceptable for recording under the laws of the state
where each related Mortgaged Property is located. The endorsement of
the Mortgage Notes, the delivery to the Purchaser, or its designee, of
the Assignments of Mortgage, and the delivery of the original endorsed
Mortgage Notes to the Purchaser, or its designee, are sufficient to
permit the Purchaser to avail itself of all protection available under
applicable law against the claims of any present or future creditors
of the Company, and are sufficient to prevent any other sale,
transfer, assignment, pledge or hypothecation of the Mortgages and the
Mortgage Notes by the Company from being enforceable.
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.
Very truly yours,
----------------------------------------
[Name]
[Assistant] General Counsel
D-3
Exhibit E
EXHIBIT E
FORM OF SECURITY RELEASE CERTIFICATION
____________________, ___
________________________
________________________
________________________
Attention: ________________________
________________________
Re: Notice of Sale and Release of Collateral
Dear Sirs:
This letter serves as notice that First Horizon Home Loan Corporation
a [type of entity], organized pursuant to the laws of [the state of
incorporation] (the "Company") has committed to sell to IXIS Real Estate Capital
Inc. under a Second Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of July 1, 2006, certain mortgage loans originated by the
Company. The Company warrants that the mortgage loans to be sold to IXIS Real
Estate Capital Inc. are in addition to and beyond any collateral required to
secure advances made by you to the Company.
The Company acknowledges that the mortgage loans to be sold to IXIS
Real Estate Capital Inc. shall not be used as additional or substitute
collateral for advances made by [_________]. IXIS Real Estate Capital Inc.
understands that the balance of the Company's mortgage loan portfolio may be
used as collateral or additional collateral for advances made by [________],
and confirms that it has no interest therein.
E-1
Execution of this letter by [__________] shall constitute a full and
complete release of any security interest, claim, or lien which [_________] may
have against the mortgage loans to be sold to IXIS Real Estate Capital Inc.
Very truly yours,
----------------------------------------
By:
-------------------------------------
Name:
-----------------------------------
Title:
-----------------------------------
Date:
-----------------------------------
Acknowledged and approved:
--------------------------
By:
-------------------------------------
Name:
-----------------------------------
Title:
-----------------------------------
Date:
-----------------------------------
E-2
Exhibit F
EXHIBIT F
FORM OF SECURITY RELEASE CERTIFICATION
I. Release of Security Interest
The financial institution named below hereby relinquishes any and all
right, title and interest it may have in all Mortgage Loans to be purchased by
IXIS Real Estate Capital Inc. from the Company named below pursuant to that
certain Second Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of July 1, 2006, and certifies that all notes, mortgages,
assignments and other documents in its possession relating to such Mortgage
Loans have been delivered and released to the Company named below or its
designees, as of the date and time of the sale of such Mortgage Loans to IXIS
Real Estate Capital Inc.
Name and Address of Financial Institution
------------------------------
(Name)
------------------------------
(Address)
By:
-------------------------
F-1
II. Certification of Release
The Company named below hereby certifies to IXIS Real Estate Capital
Inc. that, as of the date and time of the sale of the above-mentioned Mortgage
Loans to IXIS Real Estate Capital Inc. the security interests in the Mortgage
Loans released by the above-named financial institution comprise all security
interests relating to or affecting any and all such Mortgage Loans. The Company
warrants that, as of such time, there are and will be no other security
interests affecting any or all of such Mortgage Loans.
----------------------------------------
By:
-----------------------------------
Title:
-----------------------------------
Date:
-----------------------------------
F-2
Exhibit G
EXHIBIT G
LIST OF PROHIBITED STATES
1. New Jersey Owner Occupied Refinance Loans Originated between November 27,
2003 and July 6, 2004;
2. New Jersey Manufactured Housing Properties;
3. Georgia Loans Originated Between October 1, 2002 and March 7, 2003.
G-1
Exhibit H
EXHIBIT H
ASSIGNMENT AND CONVEYANCE
On this ___ day of __________, ____, ___________________ ("Seller"),
as (i) the Seller under that certain Purchase Price and Terms Agreement, dated
as of ___________, _____ (the "PPTA"), (ii) the Seller under that certain Second
Amended and Restated Mortgage Loan Purchase and Warranties Agreement, dated as
of July 1, 2006 (the "Purchase Agreement") and (iii) the Seller/Interim Servicer
under that certain Amended and Restated Interim Servicing Agreement, dated as of
October 1, 2005 (the "Interim Servicing Agreement" and, together with the PPTA
and the Purchase Agreement, the "Agreements") does hereby sell, transfer,
assign, set over and convey to IXIS Real Estate Capital Inc. ("Purchaser") as
the Purchaser under the Agreements, 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"), together with the Mortgage Files and all rights and
obligations arising under the documents contained therein. Each Mortgage Loan
subject to the Agreements was underwritten in accordance with, and conforms to,
the Underwriting Guidelines attached hereto as Exhibit C. Pursuant to Section 6
of the Purchase Agreement, the Seller has delivered to the Custodian the
documents for each Mortgage Loan to be purchased as set forth in the Custodial
Agreement. The contents of each Servicing File required to be retained by First
Horizon Home Loan Corporation ("Interim Servicer") to service the Mortgage Loans
pursuant to the Interim Servicing Agreement and thus not delivered to the
Purchaser are and shall be held in trust by the Seller in its capacity as
Interim Servicer for the benefit of the Purchaser as the owner thereof. The
Interim Servicer's possession of any portion of the Servicing File is at the
will of the Purchaser for the sole purpose of facilitating servicing of the
related Mortgage Loan pursuant to the Interim Servicing Agreement, and such
retention and possession by the Interim Servicer shall be in a custodial
capacity only. The ownership of each Mortgage Note, Mortgage, the Servicing
Rights and the contents of the Mortgage File and Servicing File is vested 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
Seller or the Interim Servicer shall immediately vest in the Purchaser and shall
be retained and maintained, in trust, by the Seller at the will of the Purchaser
in such custodial capacity only.
The Mortgage Loan Package characteristics of the Mortgage Loans
subject hereto are set forth on Exhibit B hereto.
In accordance with Section 6 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]
H-1
FIRST HORIZON
HOME LOAN CORPORATION
By:
-------------------------------------
Name:
--------------------------------
Title:
-------------------------------
Accepted and Agreed:
IXIS REAL ESTATE CAPITAL INC.
By:
--------------------------------
Name:
---------------------------
Title:
--------------------------
By:
--------------------------------
Name:
---------------------------
Title:
--------------------------
H-2
EXHIBIT A
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
THE MORTGAGE LOANS
H-3
EXHIBIT B
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE POOL
CHARACTERISTICS OF EACH MORTGAGE LOAN PACKAGE
Pool Characteristics of the Mortgage Loan Package as delivered on the
related Closing Date:
No Mortgage Loan has: (1) an outstanding principal balance less than
$_________; (2) an origination date earlier than _ months prior to the related
Cut-off Date; (3) a CLTV of greater than _____%; (4) a FICO Score of less than
___; or (5) a debt-to-income ratio of more than __%. Each First Lien Loan has a
Mortgage Interest Rate of at least ___% per annum and an outstanding principal
balance less than $_________. Each Second Lien Loan has a Mortgage Interest Rate
of at least ______% per annum and an outstanding principal balance less than
$________. Each Adjustable Rate Mortgage Loan has an Index of [_______].
H-4
EXHIBIT C
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
UNDERWRITING GUIDELINES
H-5
Exhibit I
EXHIBIT I
SELLER'S UNDERWRITING GUIDELINES
I-1
Exhibit J
EXHIBIT J
FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated [___________ __,
20__] ("Agreement"), among IXIS Real Estate Capital Inc. ("Assignor"),
[____________________] ("Assignee") and First Horizon Home Loan Corporation (the
"Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns
to the Assignee all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain Second Amended
and Restated Mortgage Loan Purchase and Warranties Agreement (the "Purchase
Agreement"), dated as of July 1, 2006, between the Assignor, as purchaser (the
"Purchaser"), and the Company, as seller, solely insofar as the Purchase
Agreement relates to the Mortgage Loans.
The Assignor specifically reserves and does not assign to the Assignee
hereunder (i) any and all right, title and interest in, to and under and any
obligations of the Assignor with respect to any mortgage loans subject to the
Purchase Agreement which are not the Mortgage Loans set forth on the Mortgage
Loan Schedule and are not the subject of this Agreement or (ii) the rights of
the Purchaser under Section 9.04 of the Purchase Agreement.
Recognition of the Company
2. From and after the date hereof (the "Securitization Closing Date"),
the Company shall and does hereby recognize that the Assignee will transfer the
Mortgage Loans and assign its rights under the Purchase Agreement (solely to the
extent set forth herein) and this Agreement to [__________________] (the
"Trust") created pursuant to a Pooling and Servicing Agreement, dated as of
[__________], 2006 (the "Pooling Agreement"), among the Assignee, the Assignor,
[___________________], as trustee (including its successors in interest and any
successor trustees under the Pooling Agreement, the "Trustee"),
[____________________], as servicer (including its successors in interest and
any successor servicer under the Pooling Agreement, the "Servicer"). The Company
hereby acknowledges and agrees that from and after the date hereof (i) the Trust
will be the owner of the Mortgage Loans, (ii) the Company shall look solely to
the Trust for performance of any obligations of the Assignor insofar as they
relate to the Mortgage Loans, (iii) the Trust (including the Trustee and the
Servicer acting on the Trust's behalf) shall have all the rights and remedies
available to the Assignor, insofar as they relate to the Mortgage Loans, under
the Purchase Agreement, including, without limitation, the enforcement of the
document delivery requirements set forth in Section 6 of the Purchase
J-1
Agreement, and shall be entitled to enforce all of the obligations of the
Company thereunder insofar as they relate to the Mortgage Loans, and (iv) all
references to the Purchaser, the Custodian or the Bailee under the Purchase
Agreement insofar as they relate to the Mortgage Loans, shall be deemed to refer
to the Trust (including the Trustee and the Servicer acting on the Trust's
behalf). Neither the Company nor the Assignor shall amend or agree to amend,
modify, waiver, or otherwise alter any of the terms or provisions of the
Purchase Agreement which amendment, modification, waiver or other alteration
would in any way affect the Mortgage Loans or the Company's performance under
the Purchase Agreement with respect to the Mortgage Loans without the prior
written consent of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee
and the Trust as of the date hereof or such other date specified herein that:
(a) The Company is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver and
perform its obligations under this Agreement and has full power and
authority to perform its obligations under the Purchase Agreement. The
execution by the Company of this Agreement is in the ordinary course of the
Company's business and will not conflict with, or result in a breach of,
any of the terms, conditions or provisions of the Company's charter or
bylaws or any legal restriction, or any material agreement or instrument to
which the Company is now a party or by which it is bound, or result in the
violation of any law, rule, regulation, order, judgment or decree to which
the Company or its property is subject. The execution, delivery and
performance by the Company of this Agreement have been duly authorized by
all necessary corporate action on part of the Company. This Agreement has
been duly executed and delivered by the Company, and, upon the due
authorization, execution and delivery by the Assignor and the Assignee,
will constitute the valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization, insolvency,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and by general principles of equity regardless
of whether enforceability is considered in a proceeding in equity or at
law;
(c) No consent, approval, order or authorization of, or declaration, filing
or registration with, any governmental entity is required to be obtained or
made by the Company in connection with the execution, delivery or
performance by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation pending or
threatened against the Company, before any court, administrative agency or
other tribunal, which would draw into question the validity of this
Agreement or the Purchase Agreement, or which, either in any one instance
or in the aggregate, would result in any material adverse change in the
ability of the Company to perform its obligations under this Agreement or
the Purchase Agreement, and the Company is solvent.
J-2
4. Pursuant to Section 13 of the Purchase Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust, that the representations and warranties set forth in Section 9.02
of the Purchase Agreement are true and correct as of the date hereof (or, with
respect to the Servicing Transfer Representations, the Transfer Date) as if such
representations and warranties were made on the date hereof unless otherwise
specifically stated in such representations and warranties.
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee and
the Servicer acting on the Trust's behalf) in connection with any breach of the
representations and warranties made by the Company set forth in Sections 3 and 4
hereof shall be as set forth in Subsection 9.03 of the Purchase Agreement as if
they were set forth herein (including without limitation the repurchase and
indemnity obligations set forth therein).
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced, with the prior
written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors and
assigns of the parties hereto and (ii) the Trust (including the Trustee and the
Servicer acting on the Trust's behalf). Any entity into which Assignor, Assignee
or Company may be merged or consolidated shall, without the requirement for any
further writing, be deemed Assignor, Assignee or Company, respectively,
hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive the
conveyance of the Mortgage Loans and the assignment of the Purchase Agreement
(to the extent assigned hereunder) by Assignor to Assignee and by Assignee to
the Trust and nothing contained herein shall supersede or amend the terms of the
Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
FIRST HORIZON
HOME LOAN CORPORATION
By:
------------------------------------
Name:
------------------------------
Its:
-------------------------------
IXIS REAL ESTATE CAPITAL INC.
By:
------------------------------------
Name:
------------------------------
Its:
-------------------------------
By:
------------------------------------
Name:
------------------------------
Its:
-------------------------------
[___________________________]
By:
------------------------------------
Name:
------------------------------
Its:
-------------------------------
J-4
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
MORTGAGE LOAN SCHEDULE
J-5
Exhibit K
EXHIBIT K
FORM OF INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AND CONTRIBUTION AGREEMENT ("Agreement"), dated
as of [_______], 200_, among/between IXIS Real Estate Capital Inc., a New York
corporation ("IXIS"), First Horizon Home Loan Corporation, a Kansas corporation
(the "Seller") and [_____________], a [_______________] [(the "Initial
Servicer")].
WHEREAS, [________________] (the "Depositor"), is acting as depositor
and registrant with respect to the Prospectus, dated [________________], and the
Prospectus Supplement to the Prospectus, [________________] (the "Prospectus
Supplement"), relating to [________________] Certificates (the "Certificates")
to be issued pursuant to a Pooling and Servicing Agreement, dated as of
[________________] (the "P&S"), among the Depositor, as depositor,
[________________], as servicer (the "Servicer"), and [________________], as
trustee (the "Trustee");
WHEREAS, as an inducement to the Depositor to enter into the P&S, and
[____________________] (the "Underwriter[s]") to enter into the Underwriting
Agreement, dated [____________________] (the "Underwriting Agreement") between
the Depositor and the Underwriter[s], Seller has agreed to provide for
indemnification and contribution on the terms and conditions hereinafter set
forth;
WHEREAS, IXIS purchased from Seller certain of the Mortgage Loans
underlying the Certificates (the "Mortgage Loans") from Seller pursuant to a
Second Amended and Restated Mortgage Loan Purchase and Warranties Agreement,
dated as of July 1, 2006 (the "Purchase Agreement"), by and between IXIS and
Seller; and
WHEREAS, pursuant to Section 13 of the Purchase Agreement, Seller has
agreed to indemnify IXIS, the Depositor, the Underwriter[s] and their respective
affiliates, present and former directors, officers, employees and agents.
NOW THEREFORE, in consideration of the agreements contained herein,
and other valuable consideration the receipt and sufficiency of which are hereby
acknowledged, Seller and IXIS agree as follows:
1. Indemnification and Contribution.
(a) Seller [and Initial Servicer] agrees to indemnify and hold
harmless IXIS, the Depositor, the Underwriter[s] and their respective
affiliates, present and former directors, officers, employees and agents and
each person, if any, who controls IXIS, the Depositor, the Underwriter[s] or
such affiliate within the meaning of either Section 15 of the Securities Act of
1933, as amended (the "1933 Act"), or Section 20 of the Securities Exchange Act
of 1934, as amended (the "1934 Act"), against any and all losses, claims,
damages or liabilities, joint or
K-1
several, to which they or any of them may become subject under the 1933 Act, the
1934 Act or other federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based in whole or in part upon (i) any
violation of the representation and warranty set forth in Section 2(vii) below
or (ii) any untrue statement or alleged untrue statement of a material fact
contained in the Prospectus Supplement, ABS Informational and Computational
Material or in the Free Writing Prospectus or any omission or alleged omission
to state in the Prospectus Supplement, ABS Informational and Computational
Material or in the Free Writing Prospectus 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, or any such untrue
statement or omission or alleged untrue statement or alleged omission made in
any amendment of or supplement to the Prospectus Supplement, ABS Informational
and Computational Material or the Free Writing Prospectus and agrees to
reimburse IXIS, the Depositor, the Underwriter[s] or such affiliates and each
such officer, director, employee, agent and controlling person promptly upon
demand for any legal or other expenses reasonably incurred by any of them in
connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that Seller [and Initial Servicer] shall be liable in any
such case only to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in reliance upon and in
conformity with the Seller Information [and Servicer Information]. The foregoing
indemnity agreement is in addition to any liability which Seller [and the
Initial Servicer] may otherwise have to IXIS, the Depositor, the Underwriter[s]
its affiliates or any such director, officer, employee, agent or controlling
person of IXIS, the Depositor, the Underwriter[s] or their respective
affiliates.
As used herein:
"ABS Informational and Computational Material" means any written
communication as defined in Item 1101(a) of Regulation AB under the 1933 Act and
the 1934 Act, as amended from time to time.
"Free Writing Prospectus" means any written communication that
constitutes a "free writing prospectus," as defined in Rule 405 under the 1933
Act.
"Regulation AB" means Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. Sections 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.
"Seller Information" means any information relating to Seller, the
Mortgage Loans and/or the underwriting guidelines [and/or servicing guidelines]
relating to the Mortgage Loans set forth in the Prospectus Supplement, ABS
Informational and Computational Material or the Free Writing Prospectus [and
static pool information regarding mortgage loans originated or acquired by the
Seller [and included in the Prospectus Supplement, ABS Informational and
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Computational Material, the Offering Circular or the Free Writing Prospectus]
[incorporated by reference from the website located at [______________]].
["Servicer Information" means any information relating to Initial
Servicer, the Mortgage Loans and/or the servicing guidelines relating to the
Mortgage Loans set forth in the Prospectus Supplement, ABS Informational and
Computational Material or the Free Writing Prospectus [and static pool
information regarding mortgage loans originated or acquired by the Initial
Servicer [and included in the Prospectus Supplement, the Offering Circular, ABS
Informational and Computational Material or the Free Writing Prospectus]
[incorporated by reference from the website located at [______________]].]
(b)______Promptly after receipt by any indemnified party under this
Section 1 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 this Section 1, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 1 except to the extent it has
been materially prejudiced by such failure; and provided, further, however, that
the failure to notify any indemnifying party shall not relieve it from any
liability which it may have to any indemnified party otherwise than under this
Section 1.
If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, except as provided in
the following paragraph, the indemnifying party shall not be liable to the
indemnified party under this Section 1 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation.
Any indemnified party shall have the right to employ separate counsel
in any such action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
necessary or appropriate for such indemnified party to employ separate counsel;
or (iii) the indemnifying party has failed to assume the defense of such action
and employ counsel reasonably satisfactory to the indemnified party, in which
case, if such indemnified party notifies the indemnifying party in writing that
it elects to employ separate counsel at the expense of the indemnifying party,
the indemnifying party shall not have the right to assume the defense of such
action on behalf of such indemnified party, it being understood, however, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one
K-3
separate firm of attorneys (in addition to local counsel) at any time for all
such indemnified parties.
Each indemnified party, as a condition of the indemnity agreements
contained in this Section 1, shall cooperate with the indemnifying party in the
defense of any such action or claim. No indemnifying party shall be liable for
any settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment for the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any indemnified
party from and against any loss or liability by reason of such settlement or
judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified
party shall have requested an indemnifying party to reimburse the indemnified
party for reasonable fees and expenses of counsel, the indemnifying party agrees
that it shall be liable for any settlement of any proceeding effected without
its written consent if (i) such settlement is entered into more than thirty (30)
days after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement.
(c) If the indemnification provided for in this Section 1 is
unavailable to an indemnified party, then the indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages or
liabilities, in such proportion as is appropriate to reflect the relative fault
of the indemnifying party and the indemnified party, respectively, in connection
with the statements or omissions that result in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault of the indemnified party and indemnifying party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by such parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission and any other equitable considerations.
(d) The indemnity and contribution agreements contained in this
Section 1 and the representations and warranties set forth in Section 2 shall
remain operative and in full force and effect regardless of (i) any termination
of this Agreement, (ii) any investigation made by IXIS, the Depositor, the
Underwriter[s] their respective affiliates, directors, officers, employees or
agents or any person controlling IXIS, the Depositor, the Underwriter[s] or any
such affiliate and (iii) acceptance of and payment for any of the Offered
Certificates.
2. Representations and Warranties. Seller [and Initial Servicer]
represents and warrants that:
(i) Seller [and Initial Servicer] is validly existing and in good
standing under the laws of its jurisdiction of formation or incorporation,
as applicable, and has full power and authority to own its assets and to
transact the business in which it is currently engaged. Seller [and Initial
Servicer] is duly qualified to do business and is in good standing in each
jurisdiction in which the character of the business transacted by it or any
K-4
properties owned or leased by it requires such qualification and in which
the failure so to qualify would have a material adverse effect on the
business, properties, assets or condition (financial or otherwise) of
Seller [and Initial Servicer];
(ii) Seller [and Initial Servicer] is not required to obtain the
consent of any other person or any consent, license, approval or
authorization from, or registration or declaration with, any governmental
authority, bureau or agency in connection with the execution, delivery,
performance, validity or enforceability of this Agreement;
(iii) the execution, delivery and performance of this Agreement by
Seller [and Initial Servicer] will not violate any provision of any
existing law or regulation or any order decree of any court applicable to
Seller [and Initial Servicer] or any provision of the charter or bylaws of
Seller [and Initial Servicer], or constitute a material breach of any
mortgage, indenture, contract or other agreement to which Seller [and
Initial Servicer] is a party or by which it may be bound;
(iv) (a) no proceeding of or before any court, tribunal or
governmental body is currently pending or, (b) to the knowledge of Seller
[and Initial Servicer], threatened against Seller [and Initial Servicer] or
any of its properties or with respect to this Agreement or the Offered
Certificates, in either case, which would have a material adverse effect on
the business, properties, assets or condition (financial or otherwise) of
Seller [and Initial Servicer];
(v) Seller [and Initial Servicer] has full power and authority to
make, execute, deliver and perform this Agreement and all of the
transactions contemplated hereunder, and has taken all necessary corporate
action to authorize the execution, delivery and performance of this
Agreement. When executed and delivered, this Agreement will constitute the
legal, valid and binding obligation of each of Seller [and Initial
Servicer] enforceable in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors'
rights generally, by the availability of equitable remedies, and by
limitations of public policy under applicable securities law as to rights
of indemnity and contribution thereunder;
(vi) this Agreement has been duly executed and delivered by Seller
[and Initial Servicer]; and
(viii) the [Seller Information] [Servicer Information] satisfies the
requirements of the applicable provisions of Regulation AB.
3. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to Seller [and Initial Servicer], will
be mailed, delivered or telegraphed and confirmed [______________________]; or,
if sent to IXIS, will be mailed, delivered or telegraphed and confirmed to IXIS
Real Estate Capital Inc., 0 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: General Counsel.
4. Miscellaneous. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York without giving effect to
the conflict of laws
K-5
provisions thereof. This Agreement shall inure to the benefit of and be binding
upon the parties hereto and their successors and assigns and the controlling
persons referred to herein, and no other person shall have any right or
obligation hereunder. Neither this Agreement nor any term hereof may be changed,
waived, discharged or terminated orally, but only by an instrument in writing
signed by the party against whom enforcement of the change, waiver, discharge or
termination is sought. This Agreement may be executed in counterparts, each of
which when so executed and delivered shall be considered an original, and all
such counterparts shall constitute one and the same instrument. Capitalized
terms used but not defined herein shall have the meanings provided in the P&S.
[Remainder of Page Intentionally Left Blank]
K-6
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective officers hereunto duly authorized, this
__th day of [_____________].
IXIS REAL ESTATE CAPITAL INC.
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
FIRST HORIZON
HOME LOAN CORPORATION
By:
------------------------------------
Name:
Title:
[INITIAL SERVICER]
By:
------------------------------------
Name:
Title:
EXHIBIT CC
FIRST NLC AGREEMENTS
CC-1
EXECUTION COPY
ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated January 30, 2007
("Agreement"), among IXIS Real Estate Capital Inc. ("Assignor"), Xxxxxx Xxxxxxx
ABS Capital I Inc. ("Assignee") and First NLC Financial Services, LLC (the
"Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns
to the Assignee all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain Third Amended
and Restated Mortgage Loan Purchase and Warranties Agreement (the "Purchase
Agreement"), dated as of May 1, 2006, between the Assignor, as purchaser (the
"Purchaser"), and the Company, as seller, solely insofar as the Purchase
Agreement relates to the Mortgage Loans.
The Assignor specifically reserves and does not assign to the Assignee
hereunder (i) any and all right, title and interest in, to and under and any
obligations of the Assignor with respect to any mortgage loans subject to the
Purchase Agreement which are not the Mortgage Loans set forth on the Mortgage
Loan Schedule and are not the subject of this Agreement or (ii) the rights of
the Purchaser (a) under Subsection 9.04 of the Purchase Agreement or (b) to any
premium recapture (i.e., the excess, if any, of the purchase price percentage
over par) in connection with any repurchase pursuant to Subsections 9.03 and
9.05 of the Purchase Agreement.
Recognition of the Company
2. From and after the date hereof (the "Securitization Closing Date"),
the Company shall and does hereby recognize that the Assignee will transfer the
Mortgage Loans and assign its rights under the Purchase Agreement (solely to the
extent set forth herein) and this Agreement to IXIS Real Estate Capital Trust
2007-HE1 (the "Trust") created pursuant to a Pooling and Servicing Agreement,
dated as of January 1, 2007 (the "Pooling Agreement"), among the Assignee, the
Assignor, Deutsche Bank National Trust Company, as trustee (in such capacity,
including its successors in interest and any successor trustees under the
Pooling Agreement, the "Trustee"), Xxxxx Fargo Bank, National Association, as
securities administrator (in such capacity, including its successors in interest
and any successor securities administrators under the Pooling Agreement, the
"Securities Administrator"), master servicer (in such capacity, including its
successors in interest and any successor master servicers under the Pooling
Agreement, the "Master Servicer") and Saxon Mortgage Services, Inc., as servicer
(including its successors in interest and any successor servicer under the
Pooling Agreement, the "Servicer"). The Company hereby acknowledges and agrees
that from and after the date hereof (i) the Trust will be the owner of the
Mortgage Loans, (ii) the Company shall look solely to the Trust for
performance of any obligations of the Assignor insofar as they relate to the
enforcement of the representations, warranties and covenants with respect to the
Mortgage Loans, (iii) the Trust (including the Trustee, Securities
Administrator, Master Servicer and the Servicer acting on the Trust's behalf)
shall have all the rights and remedies available to the Assignor, insofar as
they relate to the Mortgage Loans, under the Purchase Agreement, including,
without limitation, the enforcement of the document delivery requirements set
forth in Section 6 of the Purchase Agreement, and shall be entitled to enforce
all of the obligations of the Company thereunder insofar as they relate to the
Mortgage Loans, and (iv) all references to the Purchaser (insofar as they relate
to the rights, title and interest and, with respect to obligations of the
Purchaser, only insofar as they relate to the enforcement of the
representations, warranties and covenants of the Company), the Custodian or the
Bailee under the Purchase Agreement insofar as they relate to the Mortgage
Loans, shall be deemed to refer to the Trust (including the Trustee, Securities
Administrator, Master Servicer and the Servicer acting on the Trust's behalf).
Neither the Company nor the Assignor shall amend or agree to amend, modify,
waiver, or otherwise alter any of the terms or provisions of the Purchase
Agreement which amendment, modification, waiver or other alteration would in any
way affect the Mortgage Loans or the Company's performance under the Purchase
Agreement with respect to the Mortgage Loans without the prior written consent
of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee
and the Trust (including the Trustee, Securities Administrator, Master Servicer
and the Servicer acting on the Trust's behalf) as of the date hereof that:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver
and perform its obligations under this Agreement and has full power and
authority to perform its obligations under the Purchase Agreement. The
execution by the Company of this Agreement is in the ordinary course of the
Company's business and will not conflict with, or result in a breach of,
any of the terms, conditions or provisions of the Company's charter or
bylaws or any legal restriction, or any material agreement or instrument to
which the Company is now a party or by which it is bound, or result in the
violation of any law, rule, regulation, order, judgment or decree to which
the Company or its property is subject. The execution, delivery and
performance by the Company of this Agreement have been duly authorized by
all necessary corporate action on part of the Company. This Agreement has
been duly executed and delivered by the Company, and, upon the due
authorization, execution and delivery by the Assignor and the Assignee,
will constitute the valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization, insolvency,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and by general principles of equity regardless
of whether enforceability is considered in a proceeding in equity or at
law;
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(c) No consent, approval, order or authorization of, or
declaration, filing or registration with, any governmental entity is
required to be obtained or made by the Company in connection with the
execution, delivery or performance by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation pending
or threatened against the Company, before any court, administrative agency
or other tribunal, which would draw into question the validity of this
Agreement or the Purchase Agreement, or which, either in any one instance
or in the aggregate, would result in any material adverse change in the
ability of the Company to perform its obligations under this Agreement or
the Purchase Agreement, and the Company is solvent.
4. Pursuant to Section 13 of the Purchase Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust (including the Trustee, Securities Administrator, Master Servicer
and the Servicer acting on the Trust's behalf), that the representations and
warranties set forth in Section 9.02 of the Purchase Agreement are true and
correct as of the date hereof as if such representations and warranties were
made on the date hereof unless (i) otherwise specifically stated in such
representations and warranties or (ii) with respect to the last sentence of (b),
the first sentence of (c), (d), (e), the last sentence of (f), (h), the last
sentence of (i), (m), (n), the last sentence of (p), (q), (r), the third and
fourth sentences of (w), (x), (z), (hh), (ii), (kk), (ll), (mm), (rr), (xx),
(bbb) and (kkk), such representations and warranties are true and correct as of
the related Transfer Date (as defined in the Purchase Agreement).
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf) in connection with any breach of the representations and warranties made
by the Company set forth in Sections 3 and 4 hereof shall be as set forth in
Subsection 9.03 of the Purchase Agreement as if they were set forth herein
(including without limitation the repurchase and indemnity obligations set forth
therein); provided, however, that the Assignor specifically reserves and does
not assign to the Assignee hereunder any and all right, title and interest in
the Premium Percentage, if any, due in connection with the repurchase of a
Mortgage Loan pursuant to Subsections 9.03, 9.04 and 9.05.
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced, with the prior
written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors and
assigns of the parties hereto and (ii) the Trust (including the Trustee,
Securities Administrator, Master
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Servicer and the Servicer acting on the Trust's behalf). Any entity into which
Assignor, Assignee or Company may be merged or consolidated shall, without the
requirement for any further writing, be deemed Assignor, Assignee or Company,
respectively, hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive the
conveyance of the Mortgage Loans and the assignment of the Purchase Agreement
(to the extent assigned hereunder) by Assignor to Assignee and by Assignee to
the Trust and nothing contained herein shall supersede or amend the terms of the
Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
FIRST NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Its: President & COO
IXIS REAL ESTATE CAPITAL INC.
By: /s/ F. Xxxx Xxxxxx
------------------------------------
Name: F. Xxxx Xxxxxx
Its: Managing Director
By: /s/ Xxxxxxxxxxx Xxxxxx
------------------------------------
Name: Xxxxxxxxxxx Xxxxxx
Its: Managing Director
XXXXXX XXXXXXX ABS CAPITAL I INC.
By: /s/ Xxxxxxx Xxx
------------------------------------
Name: Xxxxxxx Xxx
Its: Vice President
-5-
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
MORTGAGE LOAN SCHEDULE
-6-
EXECUTION COPY
================================================================================
THIRD AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT
----------
IXIS REAL ESTATE CAPITAL INC.,
Purchaser
FIRST NLC FINANCIAL SERVICES, LLC,
Seller
----------
Dated as of May 1, 2006
Adjustable-Rate and Fixed-Rate, B/C Residential Mortgage Loans
================================================================================
TABLE OF CONTENTS
Page
----
SECTION 1 DEFINITIONS................................................. 1
SECTION 2 AGREEMENT TO PURCHASE....................................... 13
SECTION 3 MORTGAGE SCHEDULES.......................................... 13
SECTION 4 PURCHASE PRICE.............................................. 14
SECTION 5 EXAMINATION OF MORTGAGE FILES............................... 14
SECTION 6 CONVEYANCE FROM SELLER TO PURCHASER......................... 15
Subsection 6.01 Conveyance of Mortgage Loans;
Possession of Servicing Files...................... 15
Subsection 6.02 Books and Records.................................. 15
Subsection 6.03 Delivery of Mortgage Loan Documents................ 16
Subsection 6.04 Quality Control Procedures......................... 17
Subsection 6.05 MERS Designated Mortgage Loans..................... 17
SECTION 7 SERVICING OF THE MORTGAGE LOANS............................. 17
SECTION 8 TRANSFER OF SERVICING....................................... 18
SECTION 9 REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SELLER;
REMEDIES FOR BREACH......................................... 20
Subsection 9.01 Representations and Warranties Regarding the
Seller............................................. 20
Subsection 9.02 Representations and Warranties Regarding
Individual Mortgage Loans.......................... 24
Subsection 9.03 Remedies for Breach of Representations and
Warranties......................................... 39
Subsection 9.04 Repurchase of Mortgage Loans That Prepay in
Full............................................... 41
Subsection 9.05 Repurchase of Mortgage Loans with First Payment
Defaults........................................... 42
SECTION 10 CLOSING..................................................... 42
SECTION 11 CLOSING DOCUMENTS........................................... 43
SECTION 12 COSTS....................................................... 00
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XXXXXXX 00 XXXXXXXXXXX OF SELLER WITH A RECONSTITUTION................. 45
SECTION 14 THE SELLER.................................................. 47
Subsection 14.01 Additional Indemnification by the Seller;
Third Party Claims................................. 47
Subsection 14.02 Merger or Consolidation of the Seller.............. 48
SECTION 15 FINANCIAL STATEMENTS........................................ 48
SECTION 16 MANDATORY DELIVERY; GRANT OF SECURITY INTEREST.............. 49
SECTION 17 NOTICES..................................................... 49
SECTION 18 SEVERABILITY CLAUSE......................................... 50
SECTION 19 COUNTERPARTS................................................ 50
SECTION 20 GOVERNING LAW JURISDICTION; CONSENT TO SERVICE OF
PROCESS..................................................... 50
SECTION 21 INTENTION OF THE PARTIES.................................... 51
SECTION 22 SUCCESSORS AND ASSIGNS; ASSIGNMENT OF PURCHASE AGREEMENT.... 51
SECTION 23 WAIVERS..................................................... 51
SECTION 24 EXHIBITS.................................................... 51
SECTION 25 GENERAL INTERPRETIVE PRINCIPLES............................. 52
SECTION 26 REPRODUCTION OF DOCUMENTS................................... 52
SECTION 27 FURTHER AGREEMENTS.......................................... 52
SECTION 28 RECORDATION OF ASSIGNMENTS OF MORTGAGE...................... 53
SECTION 29 NO SOLICITATION............................................. 53
SECTION 30 WAIVER OF TRIAL BY JURY..................................... 53
SECTION 31 COMPLIANCE WITH REGULATION AB............................... 53
Subsection 31.01 Intent of the Parties; Reasonableness.............. 53
Subsection 31.02 Additional Representations and Warranties of
the Seller......................................... 54
Subsection 31.03 Information to Be Provided by the Seller........... 55
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Subsection 31.04 Indemnification; Remedies.......................... 58
EXHIBITS
EXHIBIT A CONTENTS OF EACH MORTGAGE FILE
EXHIBIT B FORM OF INTERIM SERVICING AGREEMENT
EXHIBIT C FORM OF SELLER'S OFFICER'S CERTIFICATE
EXHIBIT D FORM OF OPINION OF COUNSEL TO THE SELLER AND THE INTERIM
SERVICER
EXHIBIT E FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT F FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT G [RESERVED]
EXHIBIT H FORM OF ASSIGNMENT AND CONVEYANCE AGREEMENT
EXHIBIT I SELLER'S UNDERWRITING GUIDELINES
EXHIBIT J FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
EXHIBIT K FORM OF INDEMNIFICATION AND CONTRIBUTION AGREEMENT
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THIRD AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT
This THIRD AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND WARRANTIES
AGREEMENT (the "Agreement"), dated as of May 1, 2006, between IXIS Real Estate
Capital Inc., a New York corporation, having an office at 0 Xxxx 00xx Xxxxxx,
00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Purchaser"), and First NLC Financial
Services, LLC, a Florida limited liability company, having an office at 000 Xxxx
Xxxxxxxxx Xxxxxxxxx, Xxxxxxxx Xxx, Xxxxxxxxx Xxxxx, Xxxxxxx (the "Seller").
WITNESSETH:
WHEREAS, the Purchaser and the Seller are parties to that certain
Second Amended and Restated Mortgage Loan Purchase and Warranties Agreement,
dated as of November 1, 2005 (the "Original Agreement"), between the Purchaser
and the Seller.
WHEREAS, at the present time, the Purchaser and the Seller desire to
amend the Original Agreement to make certain modifications as set forth herein
with respect to all Mortgage Loans acquired pursuant to this Agreement or the
Original Agreement.
NOW, THEREFORE, in consideration of the premises and mutual agreements
set forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Purchaser and the Seller agree
as follows:
SECTION 1. Definitions.
For purposes of this Agreement the following capitalized terms shall
have the respective meanings set forth below.
Accepted Servicing Practices: With respect to any Mortgage Loan, those
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 and incorporating
the Delinquency Collection Policies and Procedures.
Act: The National Housing Act, as amended from time to time.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan
purchased pursuant to this Agreement.
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agency Transfer: A Xxxxxx Xxx Transfer or a Xxxxxxx Mac Transfer.
Agreement: This Mortgage Loan Purchase and Warranties Agreement and
all amendments hereof and supplements hereto.
ALTA: The American Land Title Association and its successors in
interest.
Appraised Value: (i) With respect to any First Lien Loan, the value of
the related Mortgaged Property based upon the appraisal made, if any, for the
originator at the time of origination of the Mortgage Loan or the sales price of
the Mortgaged Property at such time of origination, whichever is less; provided,
however, that in the case of a refinanced Mortgage Loan, such value is based
solely upon the appraisal made, if any, at the time of origination of such
refinanced Mortgage Loan, and (ii) with respect to any Second Lien Loan, the
value, determined pursuant to the Seller's Underwriting Guidelines, of the
related Mortgaged Property as of the origination of the Second Lien Loan.
Assignment and Conveyance Agreement: As defined in Subsection 6.01.
Assignment of Mortgage: 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.
Balloon Mortgage Loan: Any Mortgage Loan that requires only payments
of interest until the stated maturity date of the Mortgage Loan or the Monthly
Payments of principal which (not including the payment due on its stated
maturity date) are based on an amortization schedule that would be insufficient
to fully amortize the principal thereof by stated maturity date of the Mortgage
Loan.
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 State of New York
or the state in which the Interim Servicer's servicing operations are located,
are authorized or obligated by law or executive order to be closed.
Closing Date: The date or dates on which the Purchaser from time to
time shall purchase and the Seller from time to time shall sell the Mortgage
Loans listed on the related Mortgage Loan Schedule with respect to the related
Mortgage Loan Package.
CLTV: As of any date and as to (1) any Second Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the Second Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are senior or equal in
priority to the Second Lien Loan and which are secured by the same Mortgaged
Property to (b) the Appraised Value and (2) any First Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the First Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are junior or equal in
priority to the First Lien Loan and which are secured by the same Mortgaged
Property to (b) the Appraised Value.
Code: Internal Revenue Code of 1986, as amended.
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Commission: The United States Securities and Exchange Commission.
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.
Convertible Mortgage Loan: Any individual Adjustable Rate Mortgage
Loan purchased pursuant to this Agreement which contains a provision whereby the
Mortgagor is permitted to convert the Adjustable Rate Mortgage Loan to a Fixed
Rate Mortgage Loan in accordance with the terms of the related Mortgage Note.
Covered Loan: A Mortgage Loan categorized as Covered pursuant to
Appendix E of Standard & Poor's Glossary.
Credit Files: As defined in Section 5 herein.
Custodial Account: The separate account or accounts created and
maintained pursuant to Section 2.04 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Custodial Agreement: The agreement governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other
Mortgage Loan Documents, dated as of October 14, 2002, between the Purchaser and
the Custodian.
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 therein provided. If at any time there is no Custodial
Agreement in effect with respect to a Mortgage Loan, all references to the
Custodian herein and in the Interim Servicing Agreement shall be deemed to refer
to the Purchaser (or its designee) with respect to such Mortgage Loan.
Cut-off Date: The date or dates designated as such on the related
Mortgage Loan Schedule with respect to the related Mortgage Loan Package.
Deemed Material Breach Representation: Each representation identified
as such in Subsection 9.02.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased or replaced
or to be replaced with a Qualified Substitute Mortgage Loan by the Seller in
accordance with the terms of this Agreement.
Delinquency Collection Policies and Procedures: The delinquency
collection policies and procedures of the Seller, a copy of which is attached to
the Interim Servicing Agreement.
Delinquent: A Mortgage Loan in which the Monthly Payment has not been
received by the date that is one day prior to the Due Date occurring in the
immediately
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succeeding month (i.e. if Monthly Payment due on September 1 is not received
prior to October 1, such Mortgage Loan would be Delinquent).
Depositor: The depositor, as such term is defined in Regulation AB,
with respect to any Securitization Transaction.
Determination Date: The date specified in the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
Due Date: The day of the month on which the Monthly Payment is due on
a Mortgage Loan, exclusive of any days of grace.
Eligible Account: Any of (i) an account maintained with a federal or
state chartered depository institution or trust company the short-term unsecured
debt obligations of which (or, in the case of a depository institution or trust
company 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 or
Prime-1 by Moody's (or a comparable rating if another Rating Agency is specified
by the Purchaser by written notice to the Seller) at the time any amounts are
held on deposit therein, (ii) an account or accounts the deposits in which are
fully insured by the FDIC, or (iii) a trust account or accounts maintained with
a federal or state chartered depository institution or trust company acting in
its fiduciary capacity.
Escrow Account: The separate account or accounts created and
maintained pursuant to Section 2.06 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
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 document.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Xxxxxx Mae: The Federal National Mortgage Association and its
successors in interest.
Xxxxxx Xxx Guides: The Xxxxxx Xxx Xxxxxxx' Guide and the Xxxxxx Xxx
Servicers' Guide and all amendments or additions thereto.
Xxxxxx Mae Transfer: As defined in Section 13 hereof.
FDIC: The Federal Deposit Insurance Corporation and its successors in
interest.
FHA: The Federal Housing Administration, an agency within the United
States Department of Housing and Urban Development and its successors in
interest and including the Federal Housing Commissioner and the Secretary of
Housing and Urban Development where appropriate under the FHA Regulations.
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First Lien Loan: Any Mortgage Loan secured by a first lien Mortgage on
the related Mortgaged Property.
Fitch: Fitch, Inc. and its successors in interest.
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 in interest.
Xxxxxxx Mac Transfer: As defined in Section 13 hereof.
GEMICO: General Electric Mortgage Insurance Corporation, a North
Carolina corporation and its successors in interest.
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 (a) covered by the Home Ownership and
Equity Protection Act of 1994 ("HOEPA"), (b) with an "annual percentage rate" or
total "points and fees" payable by the related Mortgagor (as each such term is
calculated under HOEPA) that exceed the thresholds set forth by HOEPA and its
implementing regulations, including 12 C.F.R. Section 226.32(a)(1)(i) and (ii),
(c) classified as a "high cost home," "threshold," "covered," "high risk home,"
"predatory" or similar loan under any other applicable state, federal or local
law (or a similarly classified loan using different terminology under a law
imposing heightened regulatory scrutiny or additional legal liability for
residential mortgage loans having high interest rates, points and/or fees) or
(d) a Mortgage Loan categorized as High Cost pursuant to Appendix E of Standard
& Poor's Glossary. For avoidance of doubt, the parties agree that this
definition shall apply to any law regardless of whether such law is presently,
or in the future becomes, the subject of judicial review or litigation.
Home Loan: A Mortgage Loan categorized as Home Loan pursuant to
Appendix E of Standard & Poor's Glossary.
HUD: The Department of Housing and Urban Development, or any federal
agency or official thereof which may from time to time succeed to the functions
thereof with regard to FHA Mortgage Insurance. The term "HUD," for purposes of
this Agreement, is also deemed to include subdivisions thereof such as the FHA
and Government National Mortgage Association.
Index: With respect to each Adjustable Rate Mortgage Loan, a rate per
annum set forth on Exhibit B to each related Assignment and Conveyance
Agreement.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
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Interest Rate Adjustment Date: With respect to each Adjustable Rate
Mortgage Loan, the date, specified in the related Mortgage Note and the Mortgage
Loan Schedule, on which the Mortgage Interest Rate is adjusted.
Interim Funder: With respect to each MERS Designated Mortgage Loan,
the Person named on the MERS(R) System as the interim funder pursuant to the
MERS Procedures Manual.
Interim Servicer: First NLC Financial Services, LLC, a Florida limited
liability company and its successors in interest, and any successor interim
servicer under the Interim Servicing Agreement.
Interim Servicing Agreement: The Second Amended and Restated Interim
Servicing Agreement, dated as of November 1, 2005 by and between the Purchaser
and the Interim Servicer, providing for the Interim Servicer to service the
Mortgage Loans for an interim period as specified therein.
Investor: With respect to each MERS Designated Mortgage Loan, the
Person named on the MERS(R) System as the investor pursuant to the MERS
Procedures Manual.
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 related Mortgage Loan Schedule.
Liquidation Proceeds: Cash 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 or otherwise, or the sale of the
related Mortgaged Property if the Mortgaged Property is acquired in satisfaction
of the Mortgage Loan.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan, the
ratio (expressed as a percentage) of the outstanding principal amount of the
Mortgage Loan as of the Cut-off Date (unless otherwise indicated), to the
Appraised Value of the Mortgaged Property.
MERS: Mortgage Electronic Registration Systems, Inc., a Delaware
corporation, and its successors and assigns.
MERS Designated Mortgage Loan: Mortgage Loans for which (a) the Seller
has designated or will designate MERS as, and has taken or will take such action
as is necessary to cause MERS to be, the mortgagee of record, as nominee for the
Seller, in accordance with MERS Procedure Manual and (b) the Seller has
designated or will designate the Purchaser as the Investor on the MERS(R)
System.
MERS Procedure Manual: The MERS Procedures Manual, as it may be
amended, supplemented or otherwise modified from time to time.
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MERS Report: The report from the MERS System listing MERS Designated
Mortgage Loans and other information.
MERS(R) System: MERS mortgage electronic registry system, as more
particularly described in the MERS Procedures Manual.
Monthly Payment: The scheduled monthly payment of principal and
interest on a Mortgage Loan.
Moody's: Xxxxx'x Investors Service, Inc. and its successors in
interest.
Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note, which creates a first lien, in the case of a First Lien Loan, or
a second lien, in the case of a Second Lien Loan, on the Mortgaged Property.
Mortgage File: The items pertaining to a particular Mortgage Loan
referred to in Exhibit A 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 with respect to each Mortgage Loan.
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 applicable Mortgage Loan Schedule, which Mortgage Loan
includes without limitation the Mortgage File, the Monthly Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
Servicing Rights, and all other rights, benefits, proceeds and obligations
arising from or in connection with such Mortgage Loan, excluding replaced or
repurchased mortgage loans.
Mortgage Loan Documents: The documents required to be delivered to the
Custodian pursuant to Section 6.03 hereof with respect to any Mortgage Loan.
Mortgage Loan Package: Each pool of Mortgage Loans, which shall be
purchased by the Purchaser from the Seller from time to time on each Closing
Date.
Mortgage Loan Schedule: The schedule of Mortgage Loans setting forth
the following information with respect to each Mortgage Loan in the related
Mortgage Loan Package: (1) the Seller's Mortgage Loan identifying number; (2)
the Mortgagor's name; (3) the street address of the Mortgaged Property including
the city, state and zip code; (4) a code indicating whether the Mortgaged
Property is owner-occupied, a second home or investment property; (5) the number
and type of residential units constituting the Mortgaged Property (i.e., a
single family residence, a 2-4 family residence, a unit in a condominium project
or a unit in a planned unit development, manufactured housing); (6) the Mortgage
Loan origination date; (7) the original months to maturity or the remaining
months to maturity from the related Cut-off Date, in any case based on the
original amortization schedule and, if different, the maturity expressed in the
same manner but based on the actual amortization schedule; (8) the Loan-to-Value
Ratio at origination; (9) with respect to First Lien Loans, the LTV and with
respect to
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Second Lien Loans, the CLTV; (10) the Mortgage Interest Rate as of the related
Cut-off Date; (11) the date on which the Monthly Payment was due on the Mortgage
Loan and, if such date is not consistent with the Due Date currently in effect,
such Due Date; (12) the stated maturity date; (13) the amount of the Monthly
Payment as of the related Cut-off Date; (14) the last payment date as of which a
payment was actually applied to the outstanding principal balance; (15) the
original principal amount of the Mortgage Loan; (16) the principal balance of
the Mortgage Loan as of the close of business on the related Cut-off Date, after
deduction of payments of principal due and collected on or before the Cut-off
Date; (17) the Interest Rate Adjustment Date; (18) the Gross Margin; (19) the
Lifetime Rate Cap under the terms of the Mortgage Note; (20) a code indicating
the type of Index; (21) the Mortgage Interest Rate as of origination; (22) the
type of Mortgage Loan (i.e., fixed-rate, adjustable-rate, First Lien, Second
Lien); (23) a code indicating the purpose of the loan (i.e., purchase, rate and
term refinance, equity take-out refinance); (24) a code indicating the
documentation style (i.e., full or stated income); (25) the loan credit
classification (as described in the Underwriting Guidelines); (26) the
applicable Cut-off Date; (27) the applicable Closing Date; (28) a code
indicating the type of prepayment penalty, if any; (29) a code indicating
whether the Mortgage Loan is a Home Loan; (30) the credit risk score (FICO
score); (31) with respect to the related Mortgagor, the debt-to-income ratio;
(32) with respect to Second Lien Loans, the outstanding principal balance of the
superior lien; (33) the Appraised Value of the Mortgaged Property; (34) the sale
price of the Mortgaged Property if the Mortgage Loan was originated in
connection with the purchase of the Mortgaged Property; (35) the Periodic Rate
Cap under the terms of the Mortgage Note; (36) the Periodic Rate Floor under the
terms of the Mortgage Note; (37) whether such Mortgage Loan provides for a
prepayment penalty; (38) the prepayment penalty period of such Mortgage Loan, if
applicable; (39) a description of the type of prepayment penalty, if applicable;
(40) the MERS Identification Number; (41) whether the Mortgagor represented that
the Mortgagor would occupy the Mortgaged Property as its primary residence and
(42) a code indicating if the Mortgage Loan is a Balloon Mortgage Loan. With
respect to the Mortgage Loans in the aggregate, the Mortgage Loan Schedule shall
set forth the following information, as of the related Cut-off Date: (1) the
number of Mortgage Loans; (2) the current aggregate outstanding principal
balance of the Mortgage Loans; (3) the weighted average Mortgage Interest Rate
of the Mortgage Loans; and (4) the weighted average maturity of the Mortgage
Loans.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
Mortgaged Property: With respect to each Mortgage Loan, the
Mortgagor's real property securing repayment of a related Mortgage Note,
consisting of an unsubordinated estate in fee simple or, with respect to real
property located in jurisdictions in which the use of leasehold estates for
residential properties is a widely-accepted practice, a leasehold estate, in a
single parcel or multiple parcels of real property improved by a residential
dwelling as further described in this Agreement.
Mortgagor: The obligor on a Mortgage Note.
OCC: Office of the Comptroller of the Currency and its successors in
interest.
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Officer's Certificate: A certificate signed by the Chairman of the
Board or the Vice Chairman of the Board or a President or a Vice President and
by the Treasurer or the Secretary or one of the Assistant Treasurers or
Assistant Secretaries of the Seller, and delivered to the Purchaser as required
by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel
for the Seller, reasonably acceptable to the Purchaser, provided that any
Opinion of Counsel relating to (a) the qualification of any account required to
be maintained pursuant to this Agreement as an Eligible Account, (b)
qualification of the Mortgage Loans in a REMIC or (c) compliance with the REMIC
Provisions, must be (unless otherwise stated in such Opinion of Counsel) an
opinion of counsel who (i) is in fact independent of the Seller and any servicer
of the Mortgage Loans, (ii) does not have any material direct or indirect
financial interest in the Seller or any servicer of the Mortgage Loans or in an
Affiliate of either and (iii) is not connected with the Seller or any servicer
of the Mortgage Loans as an officer, employee, director or person performing
similar functions.
OTS: Office of Thrift Supervision and its successors in interest.
Periodic Rate Cap: 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 increase on an Interest
Rate Adjustment Date above the Mortgage Interest Rate previously in effect.
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.
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.
Preliminary Mortgage Schedule: As defined in Section 3.
Premium Percentage: With respect to any Mortgage Loan, a percentage
equal to the excess of the Purchase Price Percentage over 100%.
Principal Prepayment: Any payment or other recovery of principal on a
Mortgage Loan 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.
Purchase Price: The price paid on the related Closing Date by the
Purchaser to the Seller in exchange for the Mortgage Loans purchased on such
Closing Date as calculated in Section 4 of this Agreement.
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Purchase Price and Terms Agreement: Those certain agreements setting
forth the general terms and conditions of the transaction consummated herein and
identifying the Mortgage Loans to be purchased from time to time hereunder, by
and among the Seller, the Purchaser and the Interim Servicer (if applicable).
All of the individual Purchase Price and Terms Agreements shall collectively be
referred to as the "Purchase Price and Terms Agreement."
Purchase Price Percentage: With respect to any Mortgage Loan, an
amount equal to the percentage of par as stated in the Purchase Price and Terms
Agreement (subject to adjustment as provided therein) related to such Mortgage
Loan.
Purchaser: IXIS Real Estate Capital Inc., a New York corporation, and
its successors in interest or assigns or any successor to the Purchaser under
this Agreement as herein provided.
Qualified Correspondent: Any Person from which the Seller purchased
Mortgage Loans, provided that the following conditions are satisfied: (i) such
Mortgage Loans were originated pursuant to an agreement between the Seller and
such Person that contemplated that such Person would underwrite mortgage loans
from time to time, for sale to the Seller, in accordance with underwriting
guidelines designated by the Seller ("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 Seller within 180 days after origination; (iii) either (x) the Designated
Guidelines were, at the time such Mortgage Loans were originated, used by the
Seller in origination of mortgage loans of the same type as the Mortgage Loans
for the Seller's own account or (y) the Designated Guidelines were, at the time
such Mortgage Loans were underwritten, designated by the Seller on a consistent
basis for use by lenders in originating mortgage loans to be purchased by the
Seller; and (iv) the Seller employed, at the time such Mortgage Loans were
acquired by the Seller, pre-purchase or post-purchase quality assurance
procedures (which may involve, among other things, review of a sample of
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 Seller.
Qualified Substitute Mortgage Loan: A mortgage loan eligible to be
substituted by the Seller for a Deleted Mortgage Loan which must, on the date of
such substitution, (i) have an outstanding principal balance, after deduction of
all scheduled payments due in the month of substitution (or in the case of a
substitution of more than one mortgage loan for a Deleted Mortgage Loan, an
aggregate principal balance), not in excess of the outstanding principal balance
of the Deleted Mortgage Loan (the amount of any shortfall will be deposited in
the Custodial Account by the Seller in the month of substitution); (ii) have a
Mortgage Interest Rate not less than and not more than 1% greater than the
Mortgage Interest Rate of the Deleted Mortgage Loan; (iii) have a remaining term
to maturity not greater than and not more than one year less than that of the
Deleted Mortgage Loan; (iv) be of the same type as the Deleted Mortgage Loan
(i.e., fixed-rate, adjustable-rate with same Periodic Rate Cap, Index and lien
priority); and (v) comply with each representation and warranty (respecting
individual Mortgage Loans) set forth in Section 9 hereof.
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Rating Agency: Any of Fitch, Xxxxx'x or Standard & Poor's, or their
respective successors designated by the Purchaser.
Reconstitution: Any Securitization Transaction or Whole Loan Transfer.
Reconstitution Agreements: The agreement or agreements entered into by
the Seller and/or the Interim Servicer and the Purchaser and/or certain third
parties on the Reconstitution Date or Dates with respect to any or all of the
Mortgage Loans sold hereunder, in connection with a Whole Loan Transfer, Agency
Transfer or a Securitization Transaction pursuant to Section 13, including, but
not limited to, a seller's warranties and servicing agreement with respect to a
Whole Loan Transfer, and a trust and servicing agreement, pooling and servicing
agreement and/or seller/servicer agreements and related custodial/trust
agreement and documents with respect to a Securitization Transaction.
Reconstitution Date: As defined in Section 13.
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. Sections 229.1100 through 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 Date: The date specified in the Interim Servicing Agreement
(with respect to each Mortgage Loan, for an interim period, as specified
therein).
Repurchase Price: With respect to any Mortgage Loan for which a breach
of a representation or warranty from the Agreement or the Interim Servicing
Agreement is found, a price equal to the then outstanding principal balance of
the Mortgage Loan to be repurchased, plus accrued interest thereon at the
Mortgage Interest Rate from the date to which interest had last been paid
through the date of such repurchase, plus the amount of any outstanding advances
owed to any servicer, and plus all costs and expenses incurred by the Purchaser
or any servicer arising out of or based upon such breach, including without
limitation costs and expenses incurred in the enforcement of the Seller's
repurchase obligation hereunder.
RESPA: Real Estate Settlement Procedures Act, as amended from time to
time.
Second Lien Loan: A Mortgage Loan secured by a second lien Mortgage on
the related Mortgaged Property.
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Securities Act: The Securities Act of 1933, as amended.
Securitization Transaction. Any transaction involving either (1) 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 (2)
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.
Seller: First NLC Financial Services, LLC, a Florida limited liability
company, and its successors in interest.
Seller Information: As defined in Subsection 31.04(a).
Servicing Fee: With respect to each Mortgage Loan subject to the
Interim Servicing Agreement, an amount equal to 0.50% per annum computed on the
basis of the outstanding principal balance of the related Mortgage Loan. Such
fee shall be payable monthly and shall be pro rated for any portion of a month
during which the Mortgage Loan is serviced by the Interim Servicer under the
Interim Servicing Agreement. 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 this Agreement) of such Monthly Payment
collected by the Interim Servicer, or as otherwise provided under this
Agreement.
Servicing File: With respect to each Mortgage Loan, the file retained
by the Interim Servicer consisting of originals of all documents in the Mortgage
File which are not delivered to the Purchaser or the Custodian and copies of the
Mortgage Loan Documents.
Servicing Rights: Any and all of the following: (a) any and all rights
to service the Mortgage Loans; (b) any payments to or monies received by the
Interim Servicer for servicing the Mortgage Loans; (c) any late fees, penalties
or similar payments with respect to the Mortgage Loans; (d) all agreements or
documents creating, defining or evidencing any such servicing rights to the
extent they relate to such servicing rights and all rights of the Interim
Servicer thereunder; (e) Escrow Payments or other similar payments with respect
to the Mortgage Loans and any amounts actually collected by the Interim Servicer
with respect thereto; (f) all accounts and other rights to payment related to
any of the property described in this paragraph; and (g) any and all documents,
files, records, servicing files, servicing documents, servicing records, data
tapes, computer records, or other information pertaining to the Mortgage Loans
or pertaining to the past, present or prospective servicing of the Mortgage
Loans.
Sponsor: The sponsor, as such term is defined in Regulation AB, with
respect to any Securitization Transaction.
Standard & Poor's: Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies Inc., and its successors in interest.
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Standard & Poor's Glossary: The Standard & Poor's LEVELS(R) Glossary,
as may be in effect from time to time.
Stated Principal Balance: As to each Mortgage Loan on any date of
determination, (i) the principal balance of such Mortgage Loan at the related
Cut-off Date after giving effect to payments of principal due on or before such
date, to the extent actually received, minus (ii) all amounts previously
distributed to the Purchaser with respect to the related Mortgage Loan
representing payments or recoveries of principal on such Mortgage Loan.
Static Pool Information: Static pool information as described in Item
1105(a)(1)-(3) and 1105(c) of Regulation AB.
Successor Servicer: Any servicer of one or more Mortgage Loans
designated by the Purchaser as being entitled to the benefits of the
indemnifications set forth in Sections 9.03 and 14.01.
Third-Party Originator: Each Person, other than a Qualified
Correspondent, that originated Mortgage Loans acquired by the Seller.
Transfer Date: The date on which the Purchaser, or its designee, shall
receive the transfer of servicing responsibilities and begin to perform the
servicing of the Mortgage Loans with respect to the related Mortgage Loan
Package, and the Interim Servicer shall cease all servicing responsibilities.
Such date shall occur on the day indicated by the Purchaser to the Interim
Servicer in accordance with the Interim Servicing Agreement.
Underwriting Guidelines: The underwriting guidelines of the Seller, a
copy of which is attached hereto as Exhibit I and a then-current copy of which
shall be attached as an exhibit to the related Assignment and Conveyance.
VA: The Department of Veterans Affairs, an agency of the United States
of America, or any successor thereto including the Administrator of Veterans
Affairs.
Whole Loan Transfer: Any sale or transfer of some or all of the
Mortgage Loans, other than a Securitization Transaction.
SECTION 2. Agreement to Purchase.
The Seller agrees to sell from time to time, and the Purchaser agrees
to purchase from time to time, Mortgage Loans having an aggregate principal
balance on the related Cut-off Date in an amount as set forth in the related
Purchase Price and Terms Agreement, or in such other amount as agreed by the
Purchaser and the Seller as evidenced by the actual aggregate principal balance
of the Mortgage Loans accepted by the Purchaser on each Closing Date.
SECTION 3. Mortgage Schedules.
The Seller from time to time shall provide the Purchaser with certain
information constituting a preliminary listing of the Mortgage Loans to be
purchased on each Closing Date in
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accordance with the related Purchase Price and Terms Agreement and this
Agreement (each, a "Preliminary Mortgage Schedule").
The Seller shall deliver the Mortgage Loan Schedule for the Mortgage
Loans to be purchased on a particular Closing Date to the Purchaser at least two
(2) Business Days prior to the related Closing Date. The Mortgage Loan Schedule
shall be the related Preliminary Mortgage Schedule with those Mortgage Loans
which the Seller has not funded prior to the related Closing Date deleted.
SECTION 4. Purchase Price.
The Purchase Price for the Mortgage Loans shall be equal to (a) the
Purchase Price Percentage multiplied by the Cut-off Date Balance, plus (b)
accrued and unpaid interest on such principal balance at the weighted average
Mortgage Interest Rate (net of the Servicing Fee) of those Mortgage Loans from
the related Cut-off Date through the day prior to the related Closing Date,
inclusive. For purposes hereof, "Cut-off Date Balance" means the aggregate
principal balance, as of the related Cut-off Date, of the Mortgage Loans listed
on the related Mortgage Loan Schedule, after application of scheduled payments
of principal due on or before the related Cut-off Date, to the extent such
payments were actually received, together with any unscheduled principal
payments collected prior to the Cut-off Date; provided, however, that payments
of scheduled principal and interest paid prior to the Cut-off Date, but to be
applied on a due date beyond the related Cut-off Date, shall not be applied to
the principal balance as of the related Cut-off Date. If so provided in the
related Purchase Price and Terms Agreement, portions of the Mortgage Loans shall
be priced separately. The Purchase Price as so determined shall be paid to the
Seller on the related Closing Date by wire transfer of immediately available
funds to an account designated by the Seller in writing.
The Purchaser shall be entitled to (l) all principal paid after the
related Cut-off Date, (2) all other recoveries of principal collected on or
after the related Cut-off Date, and (3) all payments of interest on the Mortgage
Loans net of applicable Servicing Fees (minus that portion of any such payment
which is allocable to the period prior to the related Cut-off Date). The
outstanding principal balance of each Mortgage Loan as of the related Cut-off
Date is determined after application of payments of principal due on or before
the related Cut-off Date, to the extent actually collected, together with any
unscheduled principal prepayments collected prior to the Cut-off Date; provided,
however, that payments of scheduled principal and interest paid prior to the
Cut-off date, but to be applied on a due date beyond the related Cut-off Date
shall not be applied to the principal balance as of the related Cut-off Date.
Such prepaid amounts shall be the property of the Purchaser. The Seller 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
Seller to the Purchaser.
SECTION 5. Examination of Mortgage Files.
At least five (5) Business Days prior to the related Closing Date, the
Seller shall (i) either (a) deliver to the Purchaser or its designee in escrow,
for examination with respect to each Mortgage Loan to be purchased, the related
Mortgage File, including a copy of the Assignment of Mortgage (except with
respect to each MERS Designated Mortgage Loan),
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pertaining to each Mortgage Loan, or (b) make the related Mortgage File
available to the Purchaser for examination at such other location as shall
otherwise be acceptable to the Purchaser and (ii) deliver to the Purchaser
copies of the credit and servicing files (collectively, the "Credit Files").
Such examination of the Mortgage Files may be made by the Purchaser or its
designee at any reasonable time before or after the related Closing Date. If the
Purchaser makes such examination prior to the related Closing Date and
determines, in its sole discretion, that any Mortgage Loans are unacceptable to
the Purchaser for any reason, such Mortgage Loans shall be deleted from the
related Mortgage Loan Schedule, and may be replaced by a Qualified Substitute
Mortgage Loan (or Loans) acceptable to the Purchaser. The Purchaser may, at its
option and without notice to the Seller, purchase some or all of the Mortgage
Loans without conducting any partial or complete examination. The fact that the
Purchaser or its designee has conducted or has failed to conduct any partial or
complete examination of the Mortgage Files or the Credit Files shall not impair
in any way the Purchaser's (or any of its successor's) rights to demand
repurchase, substitution or other remedy as provided in this Agreement. In the
event that the Seller fails to deliver the Credit Files with respect to any
Mortgage Loan, the Seller shall, upon the request of the Purchaser, repurchase
such Mortgage Loan at the price and in the manner specified in Subsection 9.03.
SECTION 6. Conveyance from Seller to Purchaser.
Subsection 6.01. Conveyance of Mortgage Loans; Possession of Servicing
Files.
The Seller, simultaneously with the delivery of the Mortgage Loan
Schedule with respect to the related Mortgage Loan Package to be purchased on
each Closing Date, shall execute and deliver an Assignment and Conveyance
Agreement in the form attached hereto as Exhibit H (the "Assignment and
Conveyance Agreement"). The Seller shall cause the Servicing File retained by
the Interim Servicer pursuant to this Agreement to be appropriately identified
in the Seller's computer system and/or books and records, as appropriate, to
clearly reflect the sale of the related Mortgage Loan to the Purchaser. The
Seller shall cause the Interim Servicer to release from its custody the contents
of any Servicing File retained by it only in accordance with this Agreement or
the Interim Servicing Agreement, except when such release is required in
connection with a repurchase of any such Mortgage Loan pursuant to Subsection
9.03.
Subsection 6.02. Books and Records.
Record title to each Mortgage as of the related Closing Date shall be
in the name of the Seller, the Purchaser or one or more designees of the
Purchaser, as the Purchaser shall select. Notwithstanding the foregoing, each
Mortgage and related Mortgage Note shall be possessed solely by the Purchaser or
the appropriate designee of the Purchaser, as the case may be. All rights
arising out of the Mortgage Loans including, but not limited to, all funds
received by the Seller or the Interim Servicer after the related Cut-off Date on
or in connection with a Mortgage Loan shall be vested in the Purchaser or one or
more designees of the Purchaser; provided, however, that all funds received on
or in connection with a Mortgage Loan shall be received and held by the Seller
or the Interim Servicer in trust for the benefit of the Purchaser or the
appropriate designee of the Purchaser, as the case may be, as the owner of the
Mortgage Loans pursuant to the terms of this Agreement.
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The sale of each Mortgage Loan shall be reflected on the Seller's
balance sheet and other financial statements as a sale of assets by the Seller.
The Seller shall or shall cause the Interim Servicer to 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 Seller shall or shall
cause the Interim Servicer to maintain in its possession, available for
inspection by the Purchaser, 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 Xxx or Xxxxxxx Mac, including but not
limited to documentation as to the method used in determining the applicability
of the provisions of the National Flood Insurance Act of 1968, as amended, to
the Mortgaged Property, documentation evidencing insurance coverage and periodic
inspection reports, as required by the Xxxxxx Mae Guides. To the extent that
original documents are not required for purposes of realization of Liquidation
Proceeds or Insurance Proceeds, documents maintained by the Seller or the
Interim Servicer may be in the form of microfilm or microfiche so long as the
Seller or the Interim Servicer complies with the requirements of the Xxxxxx Xxx
Guides.
Subsection 6.03. Delivery of Mortgage Loan Documents.
The Seller shall deliver and release to the Custodian no later than
seven (7) Business Days prior to the related Closing Date those Mortgage Loan
Documents set forth on Exhibit A hereto with respect to each Mortgage Loan set
forth on the related Mortgage Loan Schedule.
The Custodian shall certify its receipt of all such Mortgage Loan
Documents required to be delivered pursuant to the Custodial Agreement for the
related Closing Date, as evidenced by the Certification and Trust Receipt of the
Custodian in the form annexed to the Custodial Agreement. The Purchaser shall
pay all fees and expenses of the Custodian from and after the Closing Date.
The Seller shall or shall cause the Interim Servicer to forward to the
Custodian, or to such other Person as the Purchaser shall designate in writing,
original documents evidencing an assumption, modification, consolidation or
extension of any Mortgage Loan entered into in accordance with this Agreement
within two weeks of their execution, provided, however, that the Seller shall
provide the Custodian, or to such other Person as the Purchaser shall designate
in writing, with a certified true copy of any such document submitted for
recordation within two weeks of its execution, and shall promptly 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 ninety days of its submission for recordation.
In the event any document required to be delivered to the Custodian
pursuant to the previous paragraph, including an original or copy of any
document submitted for recordation to the appropriate public recording office,
is not so delivered to the Custodian, or to such other Person as the Purchaser
shall designate in writing, within 90 days following the Closing Date (other
than with respect to the Assignments of Mortgage which shall be delivered to the
Custodian in blank and recorded subsequently by the Purchaser or its designee),
and in the event
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that the Seller does not cure such failure within 30 days of discovery or
receipt of written notification of such failure from the Purchaser, the related
Mortgage Loan shall, upon the request of the Purchaser, be repurchased by the
Seller at the price and in the manner specified in Subsection 9.03. The
foregoing repurchase obligation shall not apply in the event that the Seller
cannot deliver such original or copy of any document submitted for recordation
to the appropriate public recording office within the specified period due to a
delay caused by the recording office in the applicable jurisdiction, provided
that (i) the Seller shall deliver a recording receipt of such recording office
or, if such recording receipt is not available, an officer's certificate of a
servicing officer of the Seller, confirming that such documents have been
accepted for recording (upon request of the Purchaser and delivery by the
Purchaser to the Seller of a schedule of the related Mortgage Loans, the Seller
shall reissue and deliver to the Purchaser or its designee said officer's
certificate relating to the related Mortgage Loans), and (ii) such document is
delivered within twelve (12) months of the related Closing Date.
The Seller shall pay all initial recording fees, if any, for the
assignments of mortgage and any other fees or costs in transferring all original
documents to the Custodian or, upon written request of the Purchaser, to the
Purchaser or the Purchaser's designee.
Subsection 6.04. Quality Control Procedures.
The Seller shall, or shall cause the Interim Servicer to, have an
internal quality control program that verifies in a manner consistent with
accepted industry procedures, on a regular basis, the existence and accuracy of
the legal documents, credit documents, property appraisals, and underwriting
decisions. The program shall include evaluating and monitoring the overall
quality of the Seller's loan production and the servicing activities of the
Interim Servicer. The program is to ensure that the Mortgage Loans are
originated and serviced in accordance with Accepted Servicing Practices and the
Underwriting Guidelines; guard against dishonest, fraudulent, or negligent acts;
and guard against errors and omissions by officers, employees, or other
authorized persons.
Subsection 6.05. MERS Designated Mortgage Loans.
With respect to each MERS Designated Mortgage Loan, the Seller shall,
on or prior to the related Closing Date, designate the Purchaser as the Investor
and the Custodian as custodian, and no Person shall be listed as Interim Funder
on the MERS System. In addition, on or prior to the related Closing Date, Seller
shall provide the Custodian and the Purchaser with a MERS Report listing the
Purchaser as the Investor, the Custodian as custodian and no Person as Interim
Funder with respect to each MERS Designated Mortgage Loan.
SECTION 7. Servicing of the Mortgage Loans.
The Mortgage Loans have been sold by the Seller to the Purchaser on a
servicing released basis. Subject to, and upon the terms and conditions of this
Agreement and the Interim Servicing Agreement (with respect to each Mortgage
Loan, for an interim period, as specified therein), the Seller hereby sells,
transfers, assigns, conveys and delivers to the Purchaser the Servicing Rights.
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The Purchaser shall retain the Interim Servicer as contract servicer
of the Mortgage Loans for an interim period pursuant to and in accordance with
the terms and conditions contained in the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Except as set forth in the Interim Servicing Agreement, the Interim Servicer
shall service the Mortgage Loans on an "actual/actual" basis and otherwise in
strict compliance with the servicing provisions related to the Xxxxxx Mae MBS
Program (Special Servicing Option) of the Xxxxxx Xxx Guides (except as otherwise
set forth in the Interim Servicing Agreement). The Purchaser and Seller shall
cause the Interim Servicer to execute the Interim Servicing Agreement on the
initial Closing Date.
Pursuant to the Interim Servicing Agreement (with respect to each
Mortgage Loan, for an interim period, as specified therein), the Interim
Servicer shall begin servicing the Mortgage Loans on behalf of the Purchaser and
shall be entitled to a Servicing Fee with respect to such Mortgage Loans until
the applicable Transfer Date. The Interim Servicer shall conduct such servicing
in accordance with the Interim Servicing Agreement.
SECTION 8. Transfer of Servicing.
On the applicable Transfer Date, the Purchaser, or its designee, shall
assume all servicing responsibilities related to, and the Seller shall cause the
Interim Servicer to cease all servicing responsibilities related to, the related
Mortgage Loans subject to such Transfer Date. The Transfer Date shall be the
date determined in accordance with Section 6.02 of the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
On or prior to the applicable Transfer Date, the Seller shall, at its
sole cost and expense, take such steps as may be necessary or appropriate to
effectuate and evidence the transfer of the servicing of the related Mortgage
Loans to the Purchaser, or its designee, including but not limited to the
following:
(a) Notice to Mortgagors. The Seller shall cause the Interim Servicer
to mail to the Mortgagor of each related Mortgage Loan a letter advising such
Mortgagor of the transfer of the servicing of the related Mortgage Loan to the
Purchaser, or its designee, in accordance with the Xxxxxxxx Xxxxxxxx National
Affordable Housing Act of 1990; provided, however, the content and format of the
letter shall have the prior approval of the Purchaser. The Seller shall cause
the Interim Servicer to provide the Purchaser with copies of all such related
notices no later than the Transfer Date.
(b) Notice to Taxing Authorities and Insurance Companies. The Seller
shall cause the Interim Servicer to transmit to the applicable taxing
authorities and insurance companies (including primary mortgage insurance policy
insurers, if applicable) and/or agents, notification of the transfer of the
servicing to the Purchaser, or its designee, and instructions to deliver all
notices, tax bills and insurance statements, as the case may be, to the
Purchaser from and after the Transfer Date. The Seller shall cause the Interim
Servicer to provide the Purchaser with copies of all such notices no later than
the Transfer Date.
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(c) Delivery of Servicing Records. The Seller shall cause the Interim
Servicer to forward to the Purchaser, or its designee, all servicing records and
the Servicing File in the Interim Servicer's possession relating to each related
Mortgage Loan including the information enumerated in the Interim Servicing
Agreement (with respect to each such Mortgage Loan, for an interim period, as
specified therein).
(d) Escrow Payments. The Seller shall cause the Interim Servicer to
provide the Purchaser, or its designee, with immediately available funds by wire
transfer in the amount of the net Escrow Payments and suspense balances and all
loss draft balances associated with the related Mortgage Loans. The Seller shall
cause the Interim Servicer to provide the Purchaser with an accounting
statement, in electronic format acceptable to the Purchaser in its sole
discretion, of Escrow Payments and suspense balances and loss draft balances
sufficient to enable the Purchaser to reconcile the amount of such payment with
the accounts of the Mortgage Loans. Additionally, the Seller shall cause the
Interim Servicer to wire transfer to the Purchaser the amount of any agency,
trustee or prepaid Mortgage Loan payments and all other similar amounts held by
the Interim Servicer.
(e) Payoffs and Assumptions. The Seller shall cause the Interim
Servicer to provide to the Purchaser, or its designee, copies of all assumption
and payoff statements generated by the Interim Servicer on the related Mortgage
Loans from the related Cut-off Date to the Transfer Date.
(f) Mortgage Payments Received Prior to Transfer Date. Prior to the
Transfer Date all payments received by the Interim Servicer or the Seller on
each related Mortgage Loan shall be properly applied by the Seller to the
account of the particular Mortgagor.
(g) Mortgage Payments Received after Transfer Date. The amount of any
related Monthly Payments received by the Seller after the Transfer Date shall be
forwarded to the Purchaser by overnight mail on the date of receipt. The Seller
shall notify the Purchaser of the particulars of the payment, which notification
requirement shall be satisfied if the Seller forwards with its payment
sufficient information to permit appropriate processing of the payment by the
Purchaser. The Seller shall assume full responsibility for the necessary and
appropriate legal application of such Monthly Payments received by the Seller
after the Transfer Date with respect to related Mortgage Loans then in
foreclosure or bankruptcy; provided, for purposes of this Agreement, necessary
and appropriate legal application of such Monthly Payments shall include, but
not be limited to, endorsement of a Monthly Payment to the Purchaser with the
particulars of the payment such as the account number, dollar amount, date
received and any special Mortgagor application instructions and the Seller shall
cause the Interim Servicer to comply with the foregoing requirements with
respect to all Monthly Payments received by the Interim Servicer after the
Transfer Date.
(h) Misapplied Payments. Misapplied payments shall be processed as
follows:
(i) All parties shall cooperate in correcting misapplication errors;
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(ii) The party receiving notice of a misapplied payment occurring
prior to the applicable Transfer Date and discovered after the Transfer
Date shall immediately notify the other party;
(iii) If a misapplied payment which occurred prior to the Transfer
Date cannot be identified and said misapplied payment has resulted in a
shortage in a Custodial Account or Escrow Account, the Seller shall be
liable for the amount of such shortage. The Seller shall reimburse the
Purchaser for the amount of such shortage within thirty (30) days after
receipt of written demand therefor from the Purchaser;
(iv) If a misapplied payment which occurred prior to the Transfer Date
has created an improper Purchase Price as the result of an inaccurate
outstanding principal balance, a check shall be issued to the party shorted
by the improper payment application within five (5) Business Days after
notice thereof by the other party; and
(v) Any check issued under the provisions of this Section 8(h) shall
be accompanied by a statement indicating the corresponding Seller and/or
the Purchaser Mortgage Loan identification number and an explanation of the
allocation of any such payments.
(i) Books and Records. On the Transfer Date, the books, records and
accounts of the Seller with respect to the related Mortgage Loans shall be in
accordance with all applicable Purchaser requirements.
(j) Reconciliation. The Seller shall, on or before the Transfer Date,
reconcile principal balances and make any monetary adjustments required by the
Purchaser. Any such monetary adjustments will be transferred between the Seller
and the Purchaser as appropriate.
(k) IRS Forms. The Seller shall or shall cause the Interim Servicer to
file all IRS forms 1099, 1099A, 1098 or 1041 and K-1 which are required to be
filed on or before the Transfer Date in relation to the servicing and ownership
of the related Mortgage Loans. The Seller shall provide copies of such forms to
the Purchaser upon request and shall reimburse the Purchaser for any costs or
penalties incurred by the Purchaser due to the Seller's failure to comply with
this paragraph.
SECTION 9. Representations, Warranties and Covenants of the Seller;
Remedies for Breach.
Subsection 9.01. Representations and Warranties Regarding the Seller.
The Seller represents, warrants and covenants to the Purchaser that as
of the date hereof and as of each Closing Date:
(a) Due Organization and Authority. The Seller is a limited liability
company duly organized, validly existing and in good standing under the laws of
the state of Florida 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 wherein it owns or leases any material properties or where a Mortgaged
Property is located, if the laws of such state require licensing or
qualification
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in order to conduct business of the type conducted by the Seller, and in any
event the Seller 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
and the Interim Servicing Agreement; the Seller has the full organizational
power, authority and legal right to hold, transfer and convey the Mortgage Loans
and to execute and deliver this Agreement and to perform its obligations
hereunder and thereunder; the execution, delivery and performance of this
Agreement (including all instruments of transfer to be delivered pursuant to
this Agreement) by the Seller and the consummation of the transactions
contemplated hereby and thereby have been duly and validly authorized; this
Agreement and all agreements contemplated hereby have been duly executed and
delivered and constitute the valid, legal, binding and enforceable obligations
of the Seller, regardless of whether such enforcement is sought in a proceeding
in equity or at law; and all requisite corporate or other action has been taken
by the Seller to make this Agreement and all agreements contemplated hereby
valid and binding upon the Seller in accordance with their terms;
(b) Ordinary Course of Business. The consummation of the transactions
contemplated by this Agreement are in the ordinary course of business of the
Seller, and the transfer, assignment and conveyance of the Mortgage Notes and
the Mortgages by the Seller 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 or origination of the Mortgage Loans by the Seller,
the sale of the Mortgage Loans to the Purchaser, the consummation of the
transactions contemplated hereby and thereby, 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, conditions or provisions of the
Seller's charter, by-laws or other organizational documents or any legal
restriction or any agreement or instrument to which the Seller is now a party or
by which it is bound, or constitute a default or result in an acceleration under
any of the foregoing, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Seller or its property is subject, or
result in the creation or imposition of any lien, charge or encumbrance that
would have an adverse effect upon any of its properties pursuant to the terms of
any mortgage, contract, deed of trust or other instrument, or impair the ability
of the Purchaser to realize on the Mortgage Loans, impair the value of the
Mortgage Loans, or impair the ability of the Purchaser to realize the full
amount of any insurance benefits accruing pursuant to this Agreement;
(d) Ability to Service. The Interim Servicer has the facilities,
procedures, and experienced personnel necessary for the sound servicing of
mortgage loans of the same type as the Mortgage Loans. The Interim Servicer is
duly qualified, licensed, registered and otherwise authorized under all
applicable federal, state and local laws, and regulations, if applicable, meets
the minimum capital requirements set forth by the OTS, the OCC or the FDIC, and
is in good standing to enforce, originate, sell mortgage loans to, and service
mortgage loans in each jurisdiction wherein the Mortgaged Properties are
located;
(e) Reasonable Servicing Fee. The Seller, on behalf of the Interim
Servicer, 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 Interim
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Servicer, for accounting and tax purposes, as compensation for the servicing and
administration of the Mortgage Loans pursuant to this Agreement and the Interim
Servicing Agreement;
(f) Ability to Perform; Solvency. The Seller 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 Seller is solvent and the sale
of the Mortgage Loans will not cause the Seller to become insolvent. The sale of
the Mortgage Loans is not undertaken with the intent to hinder, delay or defraud
any of Seller's creditors;
(g) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or threatened against the Seller, before any court,
administrative agency or other tribunal asserting the invalidity of this
Agreement, seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or 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 Seller, or in any
material impairment of the right or ability of the Seller to carry on its
business substantially as now conducted, or in any material liability on the
part of the Seller, or which would draw into question the validity of this
Agreement or the Mortgage Loans or of any action taken or to be taken in
connection with the obligations of the Seller contemplated herein, or which
would be likely to impair the ability of the Seller to perform under the terms
of this Agreement;
(h) No Consent Required. No consent, approval, authorization or order
of, or registration or filing with, or notice to any court or governmental
agency or body including HUD, the FHA or the Department of Veterans Affairs is
required for the execution, delivery and performance by the Seller of or
compliance by the Seller with this Agreement or the Mortgage Loans, the delivery
of a portion of the Mortgage Files to the Custodian or the sale of the Mortgage
Loans or the consummation of the transactions contemplated by this Agreement, or
if required, such approval has been obtained prior to the related Closing Date;
(i) Selection Process. The Mortgage Loans were selected from among the
outstanding one- to four-family mortgage loans in the Seller's portfolio at the
related Closing Date as to which the representations and warranties set forth in
Subsection 9.02 could be made and such selection was not made in a manner so as
to affect adversely the interests of the Purchaser;
(j) Mortgage Loan Package Characteristics. The characteristics of the
related Mortgage Loan Package are as set forth on the description of the pool
characteristics for the applicable Mortgage Loan Package delivered pursuant to
Section 11 on the related Closing Date in the form attached as Exhibit B to each
related Assignment and Conveyance Agreement;
(k) No Untrue Information. Neither this Agreement nor any information,
statement, tape, diskette, report, form, or other document furnished or to be
furnished pursuant to this Agreement or any Reconstitution Agreement or in
connection with the transactions contemplated hereby (including any
Securitization Transaction or Whole Loan Transfer) contains or will contain any
untrue statement of fact or omits or will omit to state a fact necessary to make
the statements contained herein or therein not misleading;
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(l) Financial Statements. The Seller has delivered to the Purchaser
financial statements as to its last three complete fiscal years and any later
quarter ended more than 60 days prior to the execution of this Agreement. All
such financial statements fairly present the pertinent results of operations and
changes in financial position for each of such periods and the financial
position at the end of each such period of the Seller and its subsidiaries and
have been prepared in accordance with generally accepted accounting principles
of the United States consistently applied throughout the periods involved,
except as set forth in the notes thereto. In addition, the Seller has delivered
information as to its loan gain and loss experience in respect of foreclosures
and its loan delinquency experience for the immediately preceding three-year
period, in each case with respect to mortgage loans owned by it and mortgage
loans serviced for others during such period, and all such information so
delivered shall be true and correct in all material respects. There has been no
change in the business, operations, financial condition, properties or assets of
the Seller since the date of the Seller's financial statements that would have
an adverse effect on its ability to perform its obligations under this
Agreement. The Seller has completed any forms requested by the Purchaser in a
timely manner and in accordance with the provided instructions;
(m) No Brokers. The Seller 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;
(n) Sale Treatment. The Seller has been advised by its independent
certified public accountants that under generally accepted accounting principles
the transfer of the Mortgage Loans may be treated as a sale on the books and
records of the Seller and the Seller has determined that the disposition of the
Mortgage Loans pursuant to this Agreement will be afforded sale treatment for
tax and accounting purposes;
(o) Reasonable Purchase Price. The consideration received by the
Seller upon the sale of the Mortgage Loans under this Agreement constitutes fair
consideration and reasonably equivalent value for the Mortgage Loans;
(p) Owner of Record. The Seller is the owner of record of each
Mortgage and the indebtedness evidenced by each Mortgage Note, and upon the sale
of the Mortgage Loans to the Purchaser, the Seller will retain the Mortgage
Files with respect thereto in trust only for the purpose of servicing and
supervising the servicing of each Mortgage Loan;
(q) Seller's Origination. The Seller's decision to originate any
mortgage loan or to deny any mortgage loan application is an independent
decision based upon Seller's underwriting guidelines, and is in no way made as a
result of Purchaser's decision to purchase, or not to purchase, or the price
Purchaser may offer to pay for, any such mortgage loan, if originated;
(r) Compliance with Anti-Money Laundering Laws. The Seller has
complied with all applicable anti-money laundering laws, regulations and
executive orders, including without limitation the USA Patriot Act of 2001
(collectively, the "Anti-Money Laundering Laws"); the Seller has established an
anti-money laundering compliance program as required by the Anti-Money
Laundering Laws, has conducted the requisite due diligence in connection with
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the origination of each Mortgage Loan for purposes of the Anti-Money Laundering
Laws, including with respect to the legitimacy of the applicable Mortgagor and
the origin of the assets used by the said Mortgagor to purchase the property in
question, and maintains, and will maintain, sufficient information to identify
the applicable Mortgagor for purposes of the Anti-Money Laundering Laws;
(s) Delivery to the Custodian. The Mortgage Note, the Mortgage, the
Assignment of Mortgage and any other documents required to be delivered with
respect to each Mortgage Loan pursuant to the Custodial Agreement shall be
delivered to the Custodian all in compliance with the specific requirements of
the Custodial Agreement. With respect to each Mortgage Loan, the Seller will be
in possession of a complete Mortgage File in compliance with Exhibit A hereto,
except for such documents as will be delivered to the Custodian; and
(t) Credit Reporting. The Seller, for so long as it is the Interim
Servicer for each Mortgage Loan, will 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.
Subsection 9.02. Representations and Warranties Regarding Individual
Mortgage Loans.
The Seller hereby represents and warrants to the Purchaser that, as to
each Mortgage Loan, as of the related Closing Date for such Mortgage Loan:
(a) Mortgage Loans as Described. The information set forth in the
Mortgage Loan Schedule is complete, true and correct;
(b) Payments Current. All payments required to be made up to the
Closing Date under the terms of the Mortgage Note have been made and credited.
As of the Closing Date, no payment required under the Mortgage Loan is 30 days
or more delinquent nor has any payment under the Mortgage Loan been 30 days or
more delinquent at any time since the origination of the Mortgage Loan;
(c) No Outstanding Charges. There are no defaults in complying with
the terms of the Mortgage securing the Mortgage Loan, and all taxes,
governmental assessments, insurance premiums, water, sewer and municipal
charges, leasehold payments or ground rents which previously became due and
owing have been paid, or an escrow of funds has been established in an amount
sufficient to pay for every such item which remains unpaid and which has been
assessed but is not yet due and payable. Except for (A) payments in the nature
of escrow payments and (B) interest accruing from the date of the Mortgage Note
or date of disbursement of the Mortgage Loan proceeds, whichever is earlier to
the day which precedes by one month the Due Date of the first installment of
principal and interest, including, without limitation, taxes and insurance
payments, the Seller has not advanced funds, or induced, solicited or knowingly
received any advance of funds by a party other than the Mortgagor, directly or
indirectly, for the payment of any amount required under the Mortgage Loan;
-24-
(d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any respect,
from the date of origination 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 Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. 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, and which assumption agreement is part of the Mortgage Loan File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the Mortgage Loan
Schedule;
(e) 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, and no Mortgagor
was a debtor in any state or federal bankruptcy or insolvency proceeding at, or
subsequent to, the time the Mortgage Loan was originated;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are provided for in the Xxxxxx Xxx Guides or by
Xxxxxxx Mac, as well as all additional requirements set forth in Section 2.10 of
the Interim Servicing Agreement attached hereto as Exhibit B. If required by the
National Flood Insurance Act of 1968, as amended, each Mortgage Loan is covered
by a flood insurance policy meeting the requirements of the current guidelines
of the Federal Insurance Administration in effect, which policy conforms to
Xxxxxx Xxx and Xxxxxxx Mac, as well as all additional requirements set forth in
Section 2.10 of the Interim Servicing Agreement attached hereto as Exhibit B.
All individual insurance policies contain a standard mortgagee clause naming the
Seller and its successors and assigns as mortgagee, and all premiums thereon
have been paid and such policies may not be reduced, terminated or cancelled
without 30 days' prior written notice to the mortgagee. The Mortgage obligates
the Mortgagor thereunder to maintain the hazard insurance policy at the
Mortgagor's cost and expense, and on the Mortgagor's failure to do so,
authorizes the holder of the Mortgage to obtain and maintain such insurance at
such Mortgagor's cost and expense, and to seek reimbursement therefor from the
Mortgagor. Where required by state law or regulation, the Mortgagor has been
given an opportunity to choose the carrier of the required hazard insurance,
provided the policy is not a "master" or "blanket" hazard insurance policy
covering a condominium, or any hazard insurance policy covering the common
facilities of a planned unit development. The hazard insurance policy is the
valid and binding obligation of the insurer, is in full force and effect, and
will be in full force and effect and inure to the benefit of the Purchaser upon
the consummation of the transactions contemplated by this Agreement. The Seller
has not engaged in, and has no knowledge of the Mortgagor's or any servicer's
having engaged in, any act or omission which would impair the coverage of any
such policy, the benefits of the endorsement provided for herein, or the
validity
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and binding effect of such policy, including, without limitation, no unlawful
fee, commission, kickback or other unlawful compensation or value of any kind
has been or will be received, retained or realized by any attorney, firm or
other person or entity, and no such unlawful items have been received, retained
or realized by the Seller;
(g) 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,
predatory, abusive and fair lending, equal credit opportunity and disclosure
laws applicable to the Mortgage Loan, including, without limitation, any
provisions relating to prepayment penalties, have been complied with, the
consummation of the transactions contemplated hereby will not involve the
violation of any such laws or regulations, and the Seller 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. This
representation is a Deemed Material Breach Representation;
(h) 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 release,
cancellation, subordination or rescission. The Seller has not waived the
performance by the Mortgagor of any action, if the Mortgagor's failure to
perform such action would cause the Mortgage Loan to be in default, nor has the
Seller waived any default resulting from any action or inaction by the
Mortgagor;
(i) Location and Type of Mortgaged Property. The Mortgaged Property is
a fee simple property located in the state identified in the Mortgage Loan
Schedule except that with respect to real property located in jurisdictions in
which the use of leasehold estates for residential properties is a
widely-accepted practice, the Mortgaged Property may be a leasehold estate and
consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a low-rise condominium project, or an individual
unit in a planned unit development and that no residence or dwelling is (i) a
mobile home or (ii) a manufactured home, provided, however, that any condominium
unit or planned unit development shall not fall within any of the "Ineligible
Projects" of part XII, Section 102 of the Xxxxxx Mae Selling Guide and shall
conform with the Underwriting Guidelines. As of the date of origination, no
portion of the Mortgaged Property was used for commercial purposes, and since
the date of origination, no portion of the Mortgaged Property has been used for
commercial purposes; provided, that Mortgaged Properties which contain a home
office shall not be considered as being used for commercial purposes as long as
the Mortgaged Property has not been altered for commercial purposes and is not
storing any chemicals or raw materials other than those commonly used for
homeowner repair, maintenance and/or household purposes;
(j) Valid First and Second Lien. Each Mortgage is a valid and
subsisting first lien, with respect to First Lien Loans, or second lien, with
respect to Second Lien Loans, of record on a single parcel of real estate
constituting the Mortgaged Property, including all buildings and improvements 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,
subject in all cases to
-26-
the exceptions to title set forth in the title insurance policy with respect to
the related Mortgage Loan, which exceptions are generally acceptable to prudent
mortgage lending companies, and such other exceptions to which similar
properties are commonly subject and which do not individually, or in the
aggregate, materially and adversely affect the benefits of the security intended
to be provided by such Mortgage. In no event shall any Mortgage Loan be in a
lien position more junior than a second lien. The lien of the Mortgage is
subject only to:
(1) with respect to Second Lien Loans, the lien of the first
mortgage on the Mortgaged Property;
(2) the lien of current real property taxes and assessments
not yet due and payable;
(3) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date
of recording acceptable to prudent mortgage lending institutions
generally and specifically referred to in the lender's title
insurance policy delivered to the originator of the Mortgage Loan
and (a) specifically referred to or otherwise considered in the
appraisal made for the originator of the Mortgage Loan or (b)
which do not adversely affect the Appraised Value of the
Mortgaged Property set forth in such appraisal; and
(4) 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, enforceable and perfected (A) first lien and first priority security
interest with respect to each First Lien Loan, or (B) second lien and second
priority security interest with respect to each Second Lien Loan, in either
case, on the property described therein and Seller has full right to sell and
assign the same to Purchaser. The Mortgaged Property was not, as of the date of
origination of the Mortgage Loan, subject to a mortgage, deed of trust, deed to
secure debt or other security instrument creating a lien subordinate to the lien
of the Mortgage;
(k) Validity of Mortgage Documents. The Mortgage Note and the Mortgage
and any other agreement executed and delivered by a Mortgagor or guarantor, if
applicable, in connection with a Mortgage Loan are genuine, and each is the
legal, valid and binding obligation of the maker thereof enforceable in
accordance with its terms (including, without limitation, any provisions therein
relating to prepayment penalties). All parties to the Mortgage Note, the
Mortgage and any other such related agreement had legal capacity to enter into
the Mortgage Loan and to execute and deliver the Mortgage Note, the Mortgage and
any other related agreement, and the Mortgage Note, the Mortgage and any other
such related agreement have been duly and properly executed by other such
related parties. The documents, instruments and agreements submitted for loan
underwriting were not falsified and contain no untrue statement of material fact
or omit to state a material fact required to be stated therein or necessary to
make the
-27-
information and statements therein not misleading. No fraud, error, omission,
misrepresentation, negligence or similar occurrence with respect to a Mortgage
Loan has taken place on the part of any Person, including without limitation,
the Mortgagor, any appraiser, any builder or developer, or any other party
involved in the origination or servicing of the Mortgage Loan. The Seller has
reviewed all of the documents constituting the Servicing File and has made such
inquiries as it deems necessary to make and confirm the accuracy of the
representations set forth herein;
(l) Full Disbursement of Proceeds. The Mortgage Loan has been closed
and the proceeds of the Mortgage Loan have been fully disbursed and there is no
requirement for future advances thereunder, and any and all requirements as to
completion of any on-site or off-site improvement and as to disbursements of any
escrow funds therefor have been complied with. 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;
(m) Ownership. The Seller is the sole owner of record and holder of
the Mortgage Loan and the indebtedness evidenced by each Mortgage Note and upon
the sale of the Mortgage Loans to the Purchaser, the Seller will retain the
Mortgage Files or any part thereof with respect thereto not delivered to the
Custodian, the Purchaser or the Purchaser's designee, in trust only for the
purpose of servicing and supervising the servicing of each Mortgage Loan. The
Mortgage Loan is not assigned or pledged, and the Seller has good, indefeasible
and marketable title thereto, and has full right to transfer and sell the
Mortgage Loan to the Purchaser free and clear of any encumbrance, equity,
participation interest, lien, pledge, charge, claim or security interest, and
has full right and authority subject to no interest or participation of, or
agreement with, any other party, to sell and assign each Mortgage Loan pursuant
to this Agreement and following the sale of each Mortgage Loan, the Purchaser
will own such Mortgage Loan free and clear of any encumbrance, equity,
participation interest, lien, pledge, charge, claim or security interest. The
Seller intends to relinquish all rights to possess, control and monitor the
Mortgage Loan. After the Closing Date, the Seller will have no right to modify
or alter the terms of the sale of the Mortgage Loan and the Seller will have no
obligation or right to repurchase the Mortgage Loan or substitute another
Mortgage Loan, except as provided in this Agreement;
(n) Doing Business. 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 (2) either (i) organized
under the laws of such state, or (ii) qualified to do business in such state, or
(iii) a federal savings and loan association, a savings bank or a national bank
having a principal office in such state, or (3) not doing business in such
state;
(o) CLTV, LTV; FICO Score. No Mortgage Loan that is a Second Lien Loan
has a CLTV in excess of 90%. No Mortgage Loan has an LTV greater than 100%. At
origination of the Mortgage Loan, the Mortgagor did not have a FICO score of
less than 500;
(p) Title Insurance. The Mortgage Loan is covered by an ALTA lender's
title insurance policy or other generally acceptable form of policy or insurance
acceptable to Xxxxxx Xxx or Xxxxxxx Mac and each such title insurance policy is
issued by a title insurer acceptable to
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Xxxxxx Mae or Xxxxxxx Mac and qualified to do business in the jurisdiction where
the Mortgaged Property is located, insuring the Seller, its successors and
assigns, as to the first priority lien (with respect to First Lien Loans) or
second priority lien (with respect to Second Lien Loans) of the Mortgage in the
original principal amount of the Mortgage Loan, subject only to the exceptions
contained in clauses (1) and (2) of paragraph (j) of this Subsection 9.02, and
in the case of Adjustable Rate Mortgage Loans, against any loss by reason of the
invalidity or unenforceability of the lien resulting from the provisions of the
Mortgage providing for adjustment to the Mortgage Interest Rate and Monthly
Payment. Where required by state law or regulation, the Mortgagor has been given
the opportunity to choose the carrier of the required mortgage title insurance.
Additionally, such lender's title insurance policy affirmatively insures ingress
and egress, and against encroachments by or upon the Mortgaged Property or any
interest therein. The title policy does not contain any special exceptions
(other than the standard exclusions) for zoning and uses and has been marked to
delete the standard survey exception or to replace the standard survey exception
with a specific survey reading. The Seller, its successor and assigns, are the
sole insureds of such lender's title insurance policy, and such lender's title
insurance policy is valid and remains 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 related Mortgage, including the Seller, has done, by
act or omission, anything which would impair the coverage of such lender's title
insurance policy, including without limitation, no unlawful fee, commission,
kickback or other unlawful compensation or value of any kind has been or will be
received, retained or realized by any attorney, firm or other person or entity,
and no such unlawful items have been received, retained or realized by the
Seller;
(q) No Defaults. There is no default, breach, violation or event which
would permit acceleration existing under the Mortgage or the Mortgage Note and
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
which would permit acceleration, and neither the Seller nor any of its
affiliates nor any of their respective predecessors, have waived any default,
breach, violation or event which would permit acceleration. With respect to each
Second Lien Loan, (i) the prior mortgage is in full force and effect, (ii) there
is no default, breach, violation or event of acceleration existing under such
prior mortgage or the related mortgage note, (iii) there is 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 of acceleration
thereunder, and either (A) the prior mortgage contains a provision which allows
or (B) applicable law requires, the mortgagee under the Second Lien Loan to
receive notice of, and affords such mortgagee an opportunity to cure any default
by payment in full or otherwise under the prior mortgage;
(r) 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;
(s) Location of Improvements; No Encroachments. 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. The Mortgaged
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Property and all improvements located on or being part of the Mortgaged Property
are in compliance with all applicable zoning and building laws, ordinances and
regulations;
(t) Origination; Payment Terms. The Mortgage Loan was originated by a
mortgagee approved by the Secretary of Housing and Urban Development pursuant to
Sections 203 and 211 of the Act, a savings and loan association, a savings bank,
a commercial bank, credit union, insurance company or other similar institution
which is supervised and examined by a federal or state authority. The documents,
instruments and agreements submitted for loan underwriting were not falsified
and contain no untrue statement of material fact or omit to state a material
fact required to be stated therein or necessary to make the information and
statements therein not misleading. No Mortgage Loan contains terms or provisions
which would result in negative amortization. Principal payments on the Mortgage
Loan commenced no more than sixty days after funds were disbursed in connection
with the Mortgage Loan. The Mortgage Interest Rate as well as, with respect to
Adjustable Rate Mortgage Loans, the Lifetime Rate Cap, the Periodic Rate Floor
and the Periodic Rate Cap are as set forth on Exhibit B to each related
Assignment and Conveyance Agreement. The Mortgage Interest Rate is adjusted,
with respect to Adjustable Rate Mortgage Loans, on each Interest Rate Adjustment
Date to equal the Index plus the Gross Margin (rounded up or down to the nearest
0.125%), subject to the Periodic Rate Cap. The Mortgage Note is payable in equal
monthly installments of principal and interest, which installments of interest,
with respect to Adjustable Rate Mortgage Loans, are subject to change due to the
adjustments to the Mortgage Interest Rate on each Interest Rate Adjustment Date,
with interest calculated and payable in arrears, sufficient to amortize the
Mortgage Loan fully by the stated maturity date (unless the Mortgage Loan is
identified on the Mortgage Loan Schedule as a Balloon Mortgage Loan), over an
original term of not more than thirty years from commencement of amortization.
Unless otherwise specified on the description of pool characteristics for the
applicable Mortgage Loan Package delivered pursuant to Section 11 on the related
Closing Date in the form attached as Exhibit B to each related Assignment and
Conveyance Agreement, the Mortgage Loan is payable on the first day of each
month. There are no Convertible Mortgage Loans which contain a provision
allowing the Mortgagor to convert the Mortgage Note from an adjustable interest
rate Mortgage Note to a fixed interest rate Mortgage Note. The Due Date of the
first payment under the Mortgage Note is no more than 60 days from the date of
the Mortgage Note;
(u) 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. Upon default by a Mortgagor on a Mortgage Loan and
foreclosure on, or trustee's sale of, the Mortgaged Property pursuant to the
proper procedures, the holder of the Mortgage Loan will be able to deliver good
and merchantable title to the Mortgaged Property. 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, subject to applicable federal and state laws and judicial precedent
with respect to bankruptcy and right of redemption or similar law;
(v) Conformance with Agency and Underwriting Guidelines. The Mortgage
Loan was underwritten in accordance with the Underwriting Guidelines (a copy of
which is
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attached to the related Assignment and Conveyance Agreement as Exhibit C). The
Mortgage Note and Mortgage are on forms acceptable to Xxxxxxx Mac or Xxxxxx Mae
and no representations have been made to a Mortgagor that are inconsistent with
the mortgage instruments used;
(w) Occupancy of the Mortgaged Property. As of the Closing Date the
Mortgaged Property is lawfully occupied under applicable law. 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. The Seller has not received notification from any
Governmental Authority that the Mortgaged Property is in material non-compliance
with such laws or regulations, is being used, operated or occupied unlawfully or
has failed to have or obtain such inspection, licenses or certificates, as the
case may be. The Seller has not received notice of any violation or failure to
conform with any such law, ordinance, regulation, standard, license or
certificate. The Mortgagor represented at the time of origination of the
Mortgage Loan that the Mortgagor would occupy the Mortgaged Property as the
Mortgagor's primary residence;
(x) No Additional Collateral. The Mortgage Note is not and has not
been secured by any collateral except the lien of the corresponding Mortgage and
the security interest of any applicable security agreement or chattel mortgage
referred to in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and duly qualified under applicable law to serve as
such, has been properly designated and currently so serves and is named in the
Mortgage (or in the case of a substitution of trustee, is named in a properly
recorded substitution of trustee), and no fees or expenses are or will become
payable by the Purchaser, the Custodian or the Interim Servicer to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor;
(z) Acceptable Investment. There are no circumstances or conditions
with respect to the Mortgage, the Mortgaged Property, the Mortgagor, the
Mortgage File or the Mortgagor's credit standing that can reasonably be expected
to cause private institutional investors to regard the Mortgage Loan as an
unacceptable investment, cause the Mortgage Loan to become delinquent, or
adversely affect the value or marketability of the Mortgage Loan, or cause the
Mortgage Loan to prepay during any period materially faster or slower than the
mortgage loans originated by the Seller generally. No Mortgaged Property is
located in a state, city, county or other local jurisdiction which the Purchaser
has determined in its sole good faith discretion would cause the related
Mortgage Loan to be ineligible for whole loan sale or securitization in a
transaction consistent with the prevailing sale and securitization industry
(including, without limitation, the practice of the rating agencies) with
respect to substantially similar mortgage loans;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the Mortgage,
the Assignment of Mortgage and any other documents required to be delivered
under this Agreement for each Mortgage Loan have been delivered to the
Custodian. The Seller is in possession of a complete, true and accurate Mortgage
File in compliance with Exhibit A hereto, except for such
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documents the originals of which have been delivered to the Custodian, and the
Seller has retained copies thereof;
(bb) Condominiums/Planned Unit Developments. 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
is (i) acceptable to Xxxxxx Xxx or Xxxxxxx Mac or (ii) located in a condominium
or planned unit development project which has received project approval from
Xxxxxx Mae or Xxxxxxx Mac. The representations and warranties required by Xxxxxx
Mae with respect to such condominium or planned unit development have been
satisfied and remain true and correct;
(cc) Transfer of Mortgage Loans. Except with respect to MERS
Designated Mortgage Loans, the Assignment of Mortgage with respect to each
Mortgage Loan is in recordable form and is acceptable for recording under the
laws of the jurisdiction in which the Mortgaged Property is located. The
transfer, assignment and conveyance of the Mortgage Notes and the Mortgages by
the Seller are not subject to the bulk transfer or similar statutory provisions
in effect in any applicable jurisdiction;
(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision for the acceleration of the payment
of the unpaid principal balance of the Mortgage Loan in the event that the
Mortgaged Property is sold or transferred without the prior written consent of
the mortgagee thereunder; (ee) No Balloon Mortgage Loans. The Mortgage Loan is
not a Balloon Mortgage Loan unless specifically listed on the Mortgage Loan
Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to which
Monthly Payments are paid or partially paid with funds deposited in any separate
account established by the Seller, the Mortgagor, or anyone on behalf of the
Mortgagor, or paid by any source other than the Mortgagor nor does it contain
any other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan, and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature. The
indebtedness evidenced by the Mortgage Note is not convertible to an ownership
interest in the Mortgaged Property or the Mortgagor and the Seller has not
financed nor does it own directly or indirectly, any equity of any form in the
Mortgaged Property or the Mortgagor;
(gg) Consolidation of Future Advances. Any future advances made to the
Mortgagor prior to the applicable Cut-off Date have been consolidated with the
outstanding principal amount secured by the Mortgage, and the secured principal
amount, as consolidated, bears a single interest rate and single repayment term.
The lien of the Mortgage securing the consolidated principal amount is expressly
insured as having first or second, as applicable, lien priority by a title
insurance policy, an endorsement to the policy insuring the mortgagee's
consolidated interest or by other title evidence acceptable to Xxxxxx Xxx and
Xxxxxxx Mac. The consolidated principal amount does not exceed the original
principal amount of the Mortgage Loan;
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(hh) Mortgaged Property Undamaged; No Condemnation Proceedings. There
is no proceeding pending or threatened for the total or partial condemnation of
the Mortgaged Property. The Mortgaged Property is undamaged by waste, 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 and each Mortgaged
Property is in good repair. There have not been any condemnation proceedings
with respect to the Mortgaged Property and the Seller has no knowledge of any
such proceedings in the future;
(ii) Collection Practices; Escrow Deposits; Interest Rate Adjustments.
The origination, servicing and collection practices with respect to the Mortgage
Loan have been in all respects in compliance with Accepted Servicing Practices,
applicable laws and regulations, and have been in all respects legal and proper.
With respect to escrow deposits and Escrow Payments (other than with respect to
Second Lien Loans for which the mortgagee under the prior mortgage lien is
collecting Escrow Payments), all such payments are in the possession of Seller
and there exist no deficiencies in connection therewith for which customary
arrangements for repayment thereof have not been made. Each Mortgage Loan is
covered by a paid in full, life of loan, tax service contract that has been
assigned without penalty, premium or cost to the Purchaser. All Escrow Payments
have been collected in full compliance with state and federal law and the
provisions of the related Mortgage Note and Mortgage. An escrow of funds is not
prohibited by applicable law and has been established in an amount sufficient 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 Seller have been capitalized under the Mortgage or the Mortgage Note.
All Mortgage Interest Rate adjustments have been made in strict compliance with
state and federal law and the terms of the related Mortgage and Mortgage Note on
the related Interest Rate Adjustment Date. If, pursuant to the terms of the
Mortgage Note, another index was selected for determining the Mortgage Interest
Rate, the same index was used with respect to each Mortgage Note which required
a new index to be selected, and such selection did not conflict with the terms
of the related Mortgage Note. Any and all notices required under applicable law
and the terms of the related Mortgage Note and Mortgage regarding the Mortgage
Interest Rate and the Monthly Payment adjustments have been delivered. Any
interest required to be paid pursuant to state, federal and local law has been
properly paid and credited;
(jj) Mortgage Loan Attributes: The Mortgage Loan has the
characteristics set forth on Exhibit B to the related Assignment and Conveyance
Agreement;
(kk) Other Insurance Policies; No Defense to Coverage. No action,
inaction or event has occurred and no state of facts exists or has existed on or
prior to the Closing Date that has resulted or will result in the exclusion
from, denial of, or defense to coverage under any applicable primary mortgage
insurance policy, hazard insurance policy or bankruptcy bond (including, without
limitation, any exclusions, denials or defenses which would limit or reduce the
availability of the timely payment of the full amount of the loss otherwise due
thereunder to the insured), irrespective of the cause of such failure of
coverage. The Seller has caused or will cause to be performed any and all acts
required to preserve the rights and remedies of the Purchaser in any insurance
policies applicable to the Mortgage Loans including, without limitation, any
necessary notifications of insurers, assignments of policies or interests
therein,
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and establishments of coinsured, joint loss payee and mortgagee rights in favor
of the Purchaser. In connection with the placement of any such insurance, no
commission, fee, or other compensation has been or will be received by the
Seller or by any officer, director, or employee of the Seller or any designee of
the Seller or any corporation in which the Seller or any officer, director, or
employee had a financial interest at the time of placement of such insurance;
(ll) No Violation of Environmental Laws. The Mortgaged Property is
free from any and all toxic or hazardous substances and there exists no
violation of any local, state or federal environmental law, rule or regulation.
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; 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;
(mm) Servicemembers' Civil Relief Act. The Mortgagor has not notified
the Seller, and the Seller has no knowledge of any relief requested or allowed
to the Mortgagor under the Servicemembers' Civil Relief Act as amended, or any
similar state statute;
(nn) Appraisal. The Seller has delivered to the Purchaser an appraisal
of the Mortgaged Property signed prior to the approval of the Mortgage
application by an appraiser qualified under Xxxxxx Xxx and Xxxxxxx Mac
guidelines who (i) is licensed in the state where the Mortgaged Property is
located, (ii) has no interest, direct or indirect, in the Mortgaged Property or
in any Loan or the security therefor, and (iii) does not receive compensation
that is affected by the approval or disapproval of the Mortgage Loan. The
appraisal shall have been made within one hundred and eighty (180) days of the
origination of the Mortgage Loan and shall be completed in compliance with the
Uniform Standards of Professional Appraisal Practice, and all applicable Federal
and state laws and regulations. If the appraisal was made more than one hundred
and twenty (120) days before the origination of the Mortgage Loan, the Seller
shall have received and delivered to the Purchaser a recertification of the
appraisal;
(oo) Disclosure Materials. The Mortgagor has, to the extent required
by applicable law, executed a statement to the effect that the Mortgagor has,
received all disclosure materials required by applicable law and the Seller has
complied with all applicable law with respect to the making of the Mortgage
Loans. The Seller shall cause the Interim Servicer to maintain such statement in
the Mortgage File;
(pp) Construction or Rehabilitation of Mortgaged Property. The
Mortgage Loan was not made in connection with the construction or rehabilitation
of a Mortgaged Property or facilitating the trade-in or exchange of a Mortgaged
Property;
(qq) No Defense to Insurance Coverage. No action has been taken or
failed to be taken, no event has occurred and no state of facts exists or has
existed on or prior to the Closing Date (whether or not known to the Seller on
or prior to such date) which has resulted or will result in an exclusion from,
denial of, or defense to coverage under any primary mortgage insurance
(including, without limitation, any exclusions, denials or defenses which would
limit or reduce the availability of the timely payment of the full amount of the
loss otherwise due thereunder to the insured) whether arising out of actions,
representations, errors, omissions,
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negligence, or fraud of the Seller, the related Mortgagor or any party involved
in the application for such coverage, including the appraisal, plans and
specifications and other exhibits or documents submitted therewith to the
insurer under such insurance policy, or for any other reason under such
coverage, but not including the failure of such insurer to pay by reason of such
insurer's breach of such insurance policy or such insurer's financial inability
to pay. In connection with the placement of any such insurance, no commission,
fee, or other compensation has been or will be received by the Seller or any
designee of the Seller or any corporation in which the Seller or any officer,
director, or employee had a financial interest at the time of placement of such
insurance;
(rr) Qualified Mortgage. The Mortgage Loan is a qualified mortgage
under Section 860G(a)(3) of the Code;
(ss) Credit Information. As to each consumer report (as defined in the
Fair Credit Reporting Act, Public Law 91-508) or other credit information
furnished by the Seller to the Purchaser, that Seller has full right and
authority and is not precluded by law or contract from furnishing such
information to the Purchaser and the Purchaser is not precluded by the terms of
the Mortgage Loan Documents from furnishing the same to any subsequent or
prospective purchaser of such Mortgage. The Seller shall hold the Purchaser
harmless from any and all damages, losses, costs and expenses (including
attorney's fees) arising from disclosure of credit information in connection
with the Purchaser's secondary marketing operations and the purchase and sale of
mortgages. The Seller has in its capacity as servicer, for each Mortgage Loan,
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. This representation is a Deemed Material Breach Representation;
(tt) Leaseholds. If the Mortgage Loan is secured by a long-term
residential lease, (1) the lessor under the lease holds a fee simple interest in
the land; (2) the terms of such lease expressly permit the mortgaging of the
leasehold estate, the assignment of the lease without the lessor's consent and
the acquisition by the holder of the Mortgage of the rights of the lessee upon
foreclosure or assignment in lieu of foreclosure or provide the holder of the
Mortgage with substantially similar protections; (3) the terms of such lease do
not (a) allow the termination thereof upon the lessee's default without the
holder of the Mortgage being entitled to receive written notice of, and
opportunity to cure, such default, (b) allow the termination of the lease in the
event of damage or destruction as long as the Mortgage is in existence, (c)
prohibit the holder of the Mortgage from being insured (or receiving proceeds of
insurance) under the hazard insurance policy or policies relating to the
Mortgaged Property or (d) permit any increase in rent other than pre-established
increases set forth in the lease; (4) the original term of such lease is not
less than 15 years; (5) the term of such lease does not terminate earlier than
five years after the maturity date of the Mortgage Note; and (6) the Mortgaged
Property is located in a jurisdiction in which the use of leasehold estates in
transferring ownership in residential properties is a widely accepted practice;
(uu) Prepayment Penalty. The Mortgage Loan is subject to a prepayment
penalty as provided in the related Mortgage Note except as set forth on Exhibit
B to each related
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Assignment and Conveyance Agreement. With respect to each Mortgage Loan that has
a prepayment penalty feature, each such prepayment penalty is enforceable and,
subject to Section 9.04, will be enforced by the Seller for the benefit of the
Purchaser, and each prepayment penalty is permitted pursuant to federal, state
and local law. Each such prepayment penalty is in an amount equal to the maximum
amount permitted under applicable law and no such prepayment penalty may provide
for a term in excess of five (5) years with respect to Mortgage Loans originated
prior to October, 1, 2002. With respect to Mortgage Loans originated on or after
October 1, 2002, the duration of the prepayment period shall not exceed three
(3) years from the date of the Mortgage Note unless the Mortgage Loan was
modified to reduce the prepayment period to no more than three (3) years from
the date of such Mortgage Note and the Mortgagor was notified in writing of such
reduction in prepayment period. With respect to any Mortgage Loan that contains
a provision permitting imposition of a prepayment penalty upon a prepayment
prior to maturity: (i) the Mortgage Loan provides some benefit to the Mortgagor
(e.g., a rate or fee reduction) in exchange for accepting such prepayment
penalty, (ii) the Mortgage Loan's originator had a written policy of offering
the Mortgagor or requiring third-party brokers to offer the Mortgagor, the
option of obtaining a mortgage loan that did not require payment of such a
penalty and (iii) the prepayment penalty was adequately disclosed to the
Mortgagor in the loan documents pursuant to applicable state, local and federal
law. This representation is a Deemed Material Breach Representation;
(vv) Assumability. With respect to each Adjustable Rate Mortgage Loan,
the Mortgage Loan Documents provide that after the related first Interest Rate
Adjustment Date, a related Mortgage Loan may only be assumed if the party
assuming such Mortgage Loan meets certain credit requirements stated in the
Mortgage Loan Documents;
(ww) Conversion to Fixed Interest Rate. With respect to Adjustable
Rate Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;
(xx) Escrow Analysis. With respect to each Mortgage, the Seller has
within the last twelve months (unless such Mortgage was originated within such
twelve month period) analyzed the required Escrow Payments for each Mortgage and
adjusted the amount of such payments so that, assuming all required payments are
timely made, any deficiency will be eliminated on or before the first
anniversary of such analysis, or any overage will be refunded to the Mortgagor,
in accordance with RESPA and any other applicable law;
(yy) Predatory Lending Regulations. No Mortgage Loan is a High Cost
Loan or Covered Loan, as applicable, and no Mortgage Loan originated on or after
October 1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending
Act. No Mortgage Loan is covered by the Home Ownership and Equity Protection Act
of 1994 and no Mortgage Loan is in violation of any comparable state or local
law. The Mortgaged Property is not located in a jurisdiction where a breach of
this representation with respect to the related Mortgage Loan may result in
additional assignee liability to the Purchaser, as determined by Purchaser in
its reasonable discretion. This representation is a Deemed Material Breach
Representation;
(zz) Single-Premium Credit Life Insurance Policy. No Mortgagor was
required to purchase any single-premium credit insurance policy (e.g., life,
disability, accident, unemployment or property insurance policy) or debt
cancellation agreement as a condition of
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obtaining the extension of credit. No Mortgagor obtained a prepaid single
premium credit insurance policy (e.g., life, disability, accident, unemployment
or property insurance policy) in connection with the origination of the Mortgage
Loan. No proceeds from any Mortgage Loan were used to purchase single premium
credit insurance policies or debt cancellation agreements as part of the
origination of, or as a condition to closing, such Mortgage Loan. This
representation is a Deemed Material Breach Representation;
(aaa) Regarding the Mortgagor. The Mortgagor is one or more natural
persons and/or trustees for an Illinois land trust or a trustee under a "living
trust" and such "living trust" is in compliance with Xxxxxx Mae guidelines for
such trusts;
(bbb) Insurance. The Seller has caused or will cause to be performed
any and all acts required to preserve the rights and remedies of the Purchaser
in any insurance policies applicable to the Mortgage Loans including, without
limitation, any necessary notifications of insurers, assignments of policies or
interests therein, and establishments of coinsured, joint loss payee and
mortgagee rights in favor of the Purchaser;
(ccc) Simple Interest Mortgage Loans. The Mortgage Loan is not a
simple interest Mortgage Loan;
(ddd) Flood Certification Contract. The Mortgage Loan is covered by a
paid in full, life of loan, transferable flood certification contract that has
been assigned without penalty cost or premium to the Purchaser;
(eee) Consent. Either (a) no consent for the Second Lien Loan is
required by the holder of the related first lien or (b) such consent has been
obtained and is contained in the Mortgage File;
(fff) Origination Date. The date of origination of the Mortgage Loan
shall be no earlier than three (3) months prior to the date such Mortgage Loan
is first purchased by the Purchaser;
(ggg) No Exception. The Custodian has not noted any material
exceptions on an Exception Report (as defined in the Custodial Agreement) with
respect to the Mortgage Loan which would materially adversely affect the
Mortgage Loan or the Purchaser's ownership of the Mortgage Loan, unless
consented to by the Purchaser;
(hhh) Mortgage Submitted for Recordation. The Mortgage either has been
or will promptly be submitted for recordation in the appropriate governmental
recording office of the jurisdiction where the Mortgaged Property is located;
(iii) Endorsements. The Mortgage Note has been endorsed by Seller for
its own account and not as a fiduciary, trustee, trustor or beneficiary under a
trust agreement;
(jjj) Accuracy of Information. All information provided to the
Purchaser by the Seller with respect to the Mortgage Loan is accurate in all
material respects;
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(kkk) Mortgagor Bankruptcy. On or prior to the date 60 days after the
related Closing Date, the Mortgagor has not filed or will not file a bankruptcy
petition or has not become the subject or will not become the subject of
involuntary bankruptcy proceedings or has not consented to or will not consent
to the filing of a bankruptcy proceeding against it or to a receiver being
appointed in respect of the related Mortgaged Property;
(lll) No Construction Loans. No Mortgage Loan was made in connection
with (a) facilitating the trade-in or exchange of a Mortgaged Property or (b)
the construction or rehabilitation of a Mortgaged Property, unless the Mortgage
Loan is a construction-to-permanent mortgage loan listed on the Mortgage Loan
Schedule which has been fully disbursed, all construction work is complete and a
completion certificate has been issued;
(mmm) No Equity Participation. No document relating to the Mortgage
Loan provides for any contingent or additional interest in the form of
participation in the cash flow of the Mortgaged Property or a sharing in the
appreciation of the value of the Mortgaged Property. The indebtedness evidenced
by the Mortgage Note is not convertible to an ownership interest in the
Mortgaged Property or the Mortgagor and Seller has not financed nor does it own
directly or indirectly, any equity of any form in the Mortgaged Property or the
Mortgagor; and
(nnn) Proceeds of Mortgage Loan. The proceeds of the Mortgage Loan
have not been and shall not be used to satisfy, in whole or in part, any debt
owed or owing by the Mortgagor to Seller or any Affiliate or correspondent
thereof unless such debt was originated more than 24 months prior to the
origination of such Mortgage Loan; (ooo) No Arbitration. No Mortgagor with
respect to any Mortgage Loan originated on or after August 1, 2004 agreed to
submit to arbitration to resolve any dispute arising out of or relating in any
way to the mortgage loan transaction. This representation is a Deemed Material
Breach Representation;
(ppp) Origination Practices/No Steering. The Mortgagor was not
encouraged or required to select a Mortgage Loan product offered by the Mortgage
Loan's originator which is a higher cost product designed for less creditworthy
borrowers, unless at the time of the Mortgage Loan's origination, such Mortgagor
did not qualify taking into account such facts as, without limitation, the
Mortgage Loan's requirements and the Mortgagor's credit history, income, assets
and liabilities and debt-to-income ratios for a lower-cost credit product then
offered by the Mortgage Loan's originator or any affiliate of the Mortgage
Loan's originator. For a Mortgagor who seeks financing through a Mortgage Loan
originator's higher-priced subprime lending channel, the Mortgagor was directed
towards or offered the Mortgage Loan originator's standard mortgage line if the
Mortgagor was able to qualify for one of the standard products. This
representation is a Deemed Material Breach Representation;
(qqq) Underwriting Methodology. The methodology used in underwriting
the extension of credit for each Mortgage Loan does not rely on the extent of
the Mortgagor's equity in the collateral as the principal determining factor in
approving such extension of credit. The methodology employed objective criteria
that related such facts as, without limitation, the Mortgagor's credit history,
income, assets or liabilities, to the proposed mortgage payment and, based on
such methodology, the Mortgage Loan's originator made a reasonable determination
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that at the time of origination the Mortgagor had the ability to make timely
payments on the Mortgage Loan. Such underwriting methodology confirmed that at
the time of origination (application/approval) the Mortgagor had a reasonable
ability to make timely payments on the Mortgage Loan. This representation is a
Deemed Material Breach Representation;
(rrr) [Reserved].
(sss) Fees Charges. All fees and charges (including finance charges)
and whether or not financed, assessed, collected or to be collected in
connection with the origination and servicing of each Mortgage Loan has been
disclosed in writing to the Mortgagor in accordance with applicable state and
federal law and regulation. This representation is a Deemed Material Breach
Representation; and
(ttt) Second Lien Mortgage Loans. With respect to each Second Lien
Loan: (1) the related First Lien Loan does not permit negative amortization; (2)
where required or customary in the jurisdiction in which the Mortgaged Property
is located, the original lender has filed for record a request for notice of any
action by the related senior lienholder, and the Seller has notified such second
lienholder in writing of the existence of the Second Lien Loan and requested
notification of any action to be taken against the Mortgagor by such senior
lienholder; either (a) no consent for the Second Lien Loan is required by the
holder of the related First Lien Loan or (b) such consent has been obtained and
is contained in the related Mortgage File; (3) to the best of Seller's
knowledge, the related First Lien Loan is in full force and effect, and there is
no default, lien, breach, violation or event which would permit acceleration
existing under such First Lien Loan or Mortgage Note, and 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 which would
permit acceleration under such First Lien Loan; (4) the related first lien
Mortgage contains a provision which provides for giving notice of default or
breach to the mortgagee under the Mortgage Loan and allows such mortgagee to
cure any default under the related first lien Mortgage; and (5) the related
Mortgaged Property is the Mortgagor's principal residence. This representation
is a Deemed Material Breach Representation.
Subsection 9.03. Remedies for Breach of Representations and
Warranties.
It is understood and agreed that the representations and warranties
set forth in Subsections 9.01 and 9.02 shall survive the sale of the Mortgage
Loans to the Purchaser 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 Seller or the Purchaser of a breach of any of
the foregoing representations and warranties, the party discovering such breach
shall give prompt written notice to the other.
Within sixty (60) days of the earlier of either discovery by or notice
to the Seller of any breach of a representation or warranty which materially and
adversely affects the value of the Mortgage Loans or the interest of the
Purchaser therein (or which materially and adversely affects the value of the
applicable Mortgage Loan or the interest of the Purchaser therein in the case of
a representation and warranty relating to a particular Mortgage Loan), the
Seller shall use its best efforts promptly to cure such breach in all material
respects and, if such breach cannot be
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cured, the Seller shall, at the Purchaser's option, repurchase such Mortgage
Loan at the Repurchase Price, together with all expenses incurred by the
Purchaser as a result of such repurchase. Notwithstanding the above sentence,
(i) within sixty (60) days of the earlier of either discovery by, or notice to,
the Seller of any breach of the representation and warranty set forth in clause
(rr) of Subsection 9.02, the Seller shall repurchase such Mortgage Loan at the
Repurchase Price, together with all expenses incurred by the Purchaser as a
result of such repurchase and (ii) any breach of a Deemed Material Breach
Representation shall automatically be deemed to materially and adversely affect
the value of the Mortgage Loan and the interest of the Purchaser therein. In the
event that a breach shall involve any representation or warranty set forth in
Subsection 9.01, and (except as provided in the preceding sentence with respect
to certain breaches for which no cure is permitted) such breach cannot be cured
within sixty (60) days of the earlier of either discovery by or notice to the
Seller of such breach, all of the Mortgage Loans shall, at the Purchaser's
option, be repurchased by the Seller at the Repurchase Price, together with all
expenses incurred by the Purchaser as a result of such repurchase. However, if
the breach shall involve a representation or warranty set forth in Subsection
9.02 (other than the representations and warranties set forth in clause (rr) of
such Subsection or any Deemed Material Breach Representation) and the Seller
discovers or receives notice of any such breach within one hundred twenty (120)
days of the related Closing Date, the Seller shall, at the Purchaser's option
and provided that the Seller has a Qualified Substitute Mortgage Loan, rather
than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan
(a "Deleted Mortgage Loan") and substitute in its place a Qualified Substitute
Mortgage Loan or Loans, provided that any such substitution shall be effected
not later than one hundred twenty (120) days after the related Closing Date. If
the Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the
deficient Mortgage Loan. Any repurchase of a Mortgage Loan or Loans pursuant to
the foregoing provisions of this Subsection 9.03 shall be accomplished by either
(a) if the Interim Servicing Agreement has been entered into and is in effect,
deposit in the Custodial Account of the amount of the Repurchase Price for
distribution to the Purchaser on the next scheduled Remittance Date, 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 or
(b) if the Interim Servicing Agreement has not been entered into or is no longer
in effect, by direct remittance of the Repurchase Price to the Purchaser or its
designee in accordance with the Purchaser's instructions.
At the time of repurchase or substitution, the Purchaser and the
Seller shall arrange for the reassignment of the Deleted Mortgage Loan to the
Seller and the delivery to the Seller of any documents held by the Custodian
relating to the Deleted Mortgage Loan. In the event of a repurchase or
substitution, the Seller shall, simultaneously with such reassignment, give
written notice to the Purchaser that such repurchase or substitution has taken
place, amend the Mortgage Loan Schedule to reflect the withdrawal of the Deleted
Mortgage Loan from this Agreement, and, in the case of substitution, identify a
Qualified Substitute Mortgage Loan and amend the Mortgage Loan Schedule to
reflect the addition of such Qualified Substitute Mortgage Loan to this
Agreement. In connection with any such substitution, the Seller shall be deemed
to have made as to such Qualified Substitute Mortgage Loan the representations
and warranties set forth in this Agreement except that all such representations
and warranties set forth in this Agreement shall be deemed made as of the date
of such substitution. The Seller shall effect such substitution by delivering to
the Custodian or to such other party as the Purchaser may designate in writing
for such Qualified Substitute Mortgage Loan the documents required by
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Subsection 6.03 with the Mortgage Note endorsed as required by Subsection 6.03.
No substitution will be made in any calendar month after the Determination Date
for such month. The Seller shall cause the Interim Servicer to remit directly to
the Purchaser, or its designee in accordance with the Purchaser's instructions
the Monthly Payment less the Servicing Fee due, if any, on such Qualified
Substitute Mortgage Loan or Loans in the month following the date of such
substitution. Monthly Payments due with respect to Qualified Substitute Mortgage
Loans in the month of substitution shall be retained by the Seller. For the
month of substitution, distributions to the Purchaser shall include the Monthly
Payment due on any Deleted Mortgage Loan in the month of substitution, and the
Seller shall thereafter be entitled to retain all amounts subsequently received
by the Seller in respect of such Deleted Mortgage Loan.
For any month in which the Seller substitutes a Qualified Substitute
Mortgage Loan for a Deleted Mortgage Loan, the Seller shall determine the amount
(if any) by which the aggregate principal balance of all Qualified Substitute
Mortgage Loans as of the date of substitution is less than the aggregate Stated
Principal Balance of all Deleted Mortgage Loans (after application of scheduled
principal payments due in the month of substitution). The amount of such
shortfall shall be distributed by the Seller directly to the Purchaser or its
designee in accordance with the Purchaser's instructions within two (2) Business
Days of such substitution.
In addition to such repurchase or substitution obligation, the Seller
shall indemnify the Purchaser and its present and former directors, officers,
employees and agents and any Successor Servicer and its present and former
directors, officers, employees and agents and hold such parties harmless against
any losses, damages, penalties, fines, forfeitures, legal fees and expenses 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 any representation or warranty contained in this Agreement or any
Reconstitution Agreement. It is understood and agreed that the obligations of
the Seller set forth in this Subsection 9.03 to cure, substitute for or
repurchase a defective Mortgage Loan and to indemnify the Purchaser and
Successor Servicer as provided in this Subsection 9.03 and Subsection 14.01
constitute the sole remedies of the Purchaser and Successor Servicer respecting
a breach of the foregoing representations and warranties. For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean the Person then acting as the
Successor Servicer under this Agreement and any and all Persons who previously
were "Successor Servicers" under this Agreement.
Any cause of action against the Seller relating to or arising out of
the breach of any representations and warranties made in Subsections 9.01 and
9.02 shall accrue as to any Mortgage Loan upon (i) discovery of such breach by
the Purchaser or notice thereof by the Seller to the Purchaser, (ii) failure by
the Seller to cure such breach or repurchase such Mortgage Loan as specified
above, and (iii) demand upon the Seller by the Purchaser for compliance with
this Agreement.
Subsection 9.04. Repurchase of Mortgage Loans That Prepay in Full.
If any Mortgage Loan is prepaid within sixty (60) days from and after
the related Closing Date, the Seller shall pay to the Purchaser, within three
(3) business days of such
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prepayment in full, an amount equal to the Premium Percentage multiplied by the
outstanding principal balance of such Mortgage Loan as of the date of such
prepayment in full, less the amount of any prepayment penalty on such Mortgage
Loan actually received by the Purchaser (or, in the event that the servicing of
such Mortgage Loan has been transferred from the Interim Servicer to a servicer
approved by the Purchaser, less the amount of any prepayment penalty which has
been waived by the successor servicer). Notwithstanding the foregoing, if the
Seller is the Interim Servicer, the Seller may waive a prepayment penalty
payable by a Mortgagor during the 60 days from and after the related Closing
Date.
Subsection 9.05. Repurchase of Mortgage Loans with First Payment
Defaults.
(a) If the related Mortgagor is Delinquent with respect to the
Mortgage Loan's first Monthly Payment after origination of such Mortgage Loan,
the Seller, at the Purchaser's option exercised in its sole discretion, shall
repurchase such Mortgage Loan from the Purchaser at a price equal to the
percentage of par as stated in the related Purchase Price and Terms Agreement
(subject to adjustment as provided therein) multiplied by the then outstanding
principal balance of such Mortgage Loan, plus accrued and unpaid interest
thereon from the date to which interest was last paid through the day prior to
the repurchase date at the applicable Mortgage Interest Rate, plus any
outstanding advances owed to any servicer in connection with such Mortgage Loan.
(b) (b) If the related Mortgagor is Delinquent with respect to the
Mortgage Loan's Monthly Payment due in the month in which the related Closing
Date occurs or the Monthly Payment due in the month following the month in which
the related Closing Date occurs, in each case, on its due date or within the
grace period, all in accordance with the terms of the related Mortgage Note, the
Seller, at the Purchaser's option exercised in its sole discretion, shall
repurchase such Mortgage Loan from the Purchaser at a price equal to the
percentage of par as stated in the related Purchase Price and Terms Agreement
(subject to adjustment as provided therein) multiplied by the then outstanding
principal balance of such Mortgage Loan, plus accrued and unpaid interest
thereon from the date to which interest was last paid through the day prior to
the repurchase date at the applicable Mortgage Interest Rate, plus any
outstanding advances owed to any servicer in connection with such Mortgage Loan;
provided, however, that the Purchaser shall provide written notification to the
Seller of any delinquent payment described above.
SECTION 10. Closing.
The closing for the purchase and sale of each Mortgage Loan Package
shall take place on the related Closing Date. At the Purchaser's option, the
Closing shall be either: by telephone, confirmed by letter or wire as the
parties shall agree, or conducted in person, at such place as the parties shall
agree.
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The closing for the Mortgage Loans to be purchased on each Closing
Date shall be subject to each of the following conditions:
(a) at least two Business Days prior to the related Closing Date, the
Seller shall deliver to the Purchaser, in electronic format acceptable to the
Purchaser in its sole discretion, a listing on a loan-level basis of the
necessary information to compute the Purchase Price of the Mortgage Loans
delivered on the Closing Date (including accrued interest), and prepare a
Mortgage Loan Schedule;
(b) all of the representations and warranties of the Seller under this
Agreement and of the Interim Servicer under the Interim Servicing Agreement
(with respect to each Mortgage Loan for an interim period, as specified therein)
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 or an Event of Default under the Interim Servicing
Agreement;
(c) the Purchaser shall have received, or the Purchaser's attorneys
shall have received in escrow, all closing documents as specified in Section 11
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 terms hereof;
(d) the Seller shall have delivered and released to the Custodian all
documents required pursuant to this Agreement; and
(e) all other terms and conditions of this Agreement and the related
Purchase Price and Terms Agreement shall have been complied with.
Subject to the foregoing conditions, the Purchaser shall pay to the
Seller on the related Closing Date the Purchase Price, plus accrued interest
pursuant to Section 4 of this Agreement, by wire transfer of immediately
available funds to the account designated by the Seller.
SECTION 11. Closing Documents.
The Closing Documents for the Mortgage Loans to be purchased on each
Closing Date shall consist of fully executed originals of the following
documents:
1. this Agreement (to be executed and delivered only for the initial
Closing Date);
2. the Amended and Restated Interim Servicing Agreement, dated as of
the initial Cut-off Date, in the form of Exhibit B hereto (to be
executed and delivered only for the initial Closing Date);
3. with respect to the initial Closing Date, the Custodial
Agreement, dated as of the initial Cut-off Date;
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4. the related Mortgage Loan Schedule, segregated by Mortgage Loan
Package, one copy to be attached hereto, one copy to be attached
to the Custodian's counterpart of the Custodial Agreement, and
one copy to be attached to the related Assignment and Conveyance
as the Mortgage Loan Schedule thereto;
5. a Custodian's Certification, as required under the Custodial
Agreement, in the form of Exhibit G-1 to the Custodial Agreement;
6. with respect to the initial Closing Date, a Custodial Account
Letter Agreement or a Custodial Account Certification, as
applicable, as required under the Interim Servicing Agreement;
7. with respect to the initial Closing Date, an Escrow Account
Letter Agreement or an Escrow Account Certification, as
applicable, as required under the Interim Servicing Agreement;
8. with respect to the initial Closing Date, an Officer's
Certificate, in the form of Exhibit C hereto with respect to each
of the Seller and the Interim Servicer, including all attachments
hereto; with respect to subsequent Closing Dates, an Officer's
Certificate upon request of the Purchaser;
9. with respect to the initial Closing Date, an Opinion of Counsel
of each of the Seller and the Interim Servicer (who may be an
employee of the Seller or the Interim Servicer, as applicable),
in the form of Exhibit D hereto ("Opinion of Counsel of the
Seller"); with respect to subsequent Closing Dates, an Opinion of
Counsel of the Seller upon request of the Purchaser;
10. with respect to the initial Closing Date, an Opinion of Counsel
of the Custodian (who may be an employee of the Custodian), in
the form of an exhibit to the Custodial Agreement;
11. a Security Release Certification, in the form of Exhibit E or F,
as applicable, hereto executed by any person, as requested by the
Purchaser, if any of the Mortgage Loans have at any time been
subject to any security interest, pledge or hypothecation for the
benefit of such person;
12. a certificate or other evidence of merger or change of name,
signed or stamped by the applicable regulatory authority, if any
of the Mortgage Loans were acquired by the Seller by merger or
acquired or originated by the Seller while conducting business
under a name other than its present name, if applicable;
13. with respect to the initial Closing Date, the Underwriting
Guidelines to be attached to the related Assignment and
Conveyance as Exhibit C;
14. Assignment and Conveyance Agreement in the form of Exhibit H
hereto;
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15. Exhibit B to the related Assignment and Conveyance Agreement; and
16. a MERS Report reflecting the Purchaser as Investor and no Person
as Interim Funder for each MERS Designated Mortgage Loan.
The Seller shall bear the risk of loss of the closing documents until
such time as they are received by the Purchaser or its attorneys.
SECTION 12. Costs.
The Purchaser shall pay any commissions due its salesmen and the legal
fees and expenses of its attorneys and custodial fees. All other costs and
expenses incurred in connection with the transfer and delivery of the Mortgage
Loans and the Servicing Rights including recording fees, fees for title policy
endorsements and continuations, fees for recording Assignments of Mortgage, and
the Seller's attorney's fees, shall be paid by the Seller.
SECTION 13. Cooperation of Seller with a Reconstitution.
The Seller and the Purchaser agree that with respect to some or all of
the Mortgage Loans, after each Closing Date, on one or more dates (each, a
"Reconstitution Date") at the Purchaser's sole option, the Purchaser may effect
a Reconstitution of some or all of the Mortgage Loans then subject to this
Agreement, without recourse, to:
a) Xxxxxx Xxx under its Cash Purchase Program or MBS Program
(Special Servicing Option) (each, a "Xxxxxx Mae Transfer"); or
b) Xxxxxxx Mac (the "Xxxxxxx Mac Transfer"); or
c) one or more third party purchasers in one or more Whole Loan
Transfers; or
d) one or more trusts or other entities to be formed as part of one
or more Securitization Transactions.
The Seller agrees to execute in connection with any Agency Transfer,
any and all reasonably acceptable pool purchase contracts, and/or agreements
among the Purchaser, the Seller, Xxxxxx Xxx or Xxxxxxx Mac (as the case may be)
and any servicer in connection with a Whole Loan Transfer, a seller's warranties
and servicing agreement or a participation and servicing agreement in form and
substance reasonably acceptable to the parties, and in connection with a
Securitization Transaction, a pooling and servicing agreement in form and
substance reasonably acceptable to the parties or an Assignment and Recognition
Agreement substantially in the form attached hereto as Exhibit J (collectively,
the agreements referred to herein are designated, the "Reconstitution
Agreements"), together with an opinion of counsel with respect to such
Reconstitution Agreements.
With respect to each Whole Loan Transfer and each Securitization
Transaction entered into by the Purchaser, the Seller agrees (1) to cooperate
fully with the Purchaser and any prospective purchaser with respect to all
reasonable requests and due diligence procedures; (2) to
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execute, deliver and perform all Reconstitution Agreements required by the
Purchaser; and (3) to restate the representations and warranties set forth in
this Agreement and the Interim Servicing Agreement as of the related
Reconstitution Date or make representations and warranties as may be reasonably
required by the issuer, any Rating Agency or prospective purchaser of the
related securities or such Mortgage Loans, in connection with such
Reconstitution; provided that the Seller shall make the representations and
warranties set forth in Section 9.02(a), the last sentence of (b), the first
sentence of (c), (d), (e), the last sentence of (f), (h), the last sentence of
(i), (m), (n), the last sentence of (p), (q), (r), the third and fourth
sentences of (w), (x), (z), (hh), (ii), (kk), (ll), (mm), (rr), (xx), (bbb) and
(kkk) as of the related Transfer Date. With respect to each additional requested
representation and warranty required pursuant to the preceding sentence, the
Seller and the Purchaser shall negotiate such representations and warranties in
good faith and shall determine the reasonableness of such requirement after
consultation with each other. The Seller shall provide to such servicer or
issuer, as the case may be, and any other participants or purchasers in such
Reconstitution: (i) any and all information and appropriate verification of
information which may be reasonably available to the Seller or its affiliates,
whether through letters of its auditors and counsel or otherwise, as the
Purchaser or any such other participant shall request; and (ii) such additional
representations, warranties, covenants, opinions of counsel, letters from
auditors, and certificates of public officials or officers of the Seller or the
Interim Servicer as are reasonably believed necessary by the Purchaser or any
such other participant; and (iii) to execute, deliver and satisfy all conditions
set forth in any indemnity agreement required by the Purchaser or any such
participant, including, without limitation, an Indemnification and Contribution
Agreement in substantially the form attached hereto as Exhibit K. Moreover, the
Seller agrees to cooperate with all reasonable requests made by the Purchaser to
effect such Reconstitution Agreements. The Seller shall indemnify the Purchaser,
each affiliate of the Purchaser participating in the Reconstitution and each
Person who controls the Purchaser or such affiliate and their respective present
and former directors, officers, employees and agents, and 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 each of them may sustain in any way related to any information
provided by or on behalf of the Seller regarding the Seller, the Seller's
servicing practices or performance, the Mortgage Loans or the Underwriting
Guidelines set forth in any offering document prepared in connection with any
Reconstitution. For purposes of the previous sentence, "Purchaser" shall mean
the Person then acting as the Purchaser under this Agreement and any and all
Persons who previously were "Purchasers" under this Agreement.
In the event the Purchaser has elected to have the Interim Servicer or
the Seller hold record title to the Mortgages, prior to the Reconstitution Date,
the Interim Servicer or the Seller shall prepare an assignment of mortgage in
blank or to the prospective purchaser or trustee, as applicable, from the
Interim Servicer or the Seller, as applicable, acceptable to the prospective
purchaser or trustee, as applicable, for each Mortgage Loan that is part of the
Reconstitution and shall pay all preparation and recording costs associated
therewith. In connection with the Reconstitution, the Interim Servicer shall
execute or shall cause the Seller to execute each Assignment of Mortgage (except
with respect to each MERS Designated Mortgage Loan), track such Assignments of
Mortgage to ensure they have been recorded and deliver them as required by the
prospective purchaser or trustee, as applicable, upon the Interim Servicer's
receipt thereof. Additionally, the Interim Servicer shall prepare and execute or
shall cause the
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Seller to execute, at the direction of the Purchaser, any note endorsement in
connection with any and all seller/servicer agreements.
All Mortgage Loans not sold or transferred pursuant to a
Reconstitution shall remain subject to this Agreement and, if the Interim
Servicing Agreement shall remain in effect with respect to the related Mortgage
Loan Package, shall continue to be serviced in accordance with the terms of this
Agreement and the Interim Servicing Agreement and with respect thereto this
Agreement shall remain in full force and effect.
SECTION 14. The Seller.
Subsection 14.01. Additional Indemnification by the Seller; Third
Party Claims.
(a) The Seller shall indemnify the Purchaser and its present and
former directors, officers, employees and agents and any Successor Servicer and
its present and former directors, officers, employees and agents, and hold such
parties harmless against any and all claims, losses, damages, penalties, fines,
forfeitures, legal fees (including legal fees incurred in connection with the
enforcement of the Seller's indemnification obligation under this Section 14.01)
and related costs, judgments, and any other costs, fees and expenses that such
parties may sustain in any way related to the failure of the Seller to perform
its duties and the Interim Servicer to service the Mortgage Loans in strict
compliance with the terms of this Agreement or any Reconstitution Agreement
entered into pursuant to Section 13 or any breach of any of Seller's
representations, warranties and covenants set forth in this Agreement (provided
that such costs shall not include any lost profits). For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean the Person then acting as the
Successor Servicer under this Agreement and any and all Persons who previously
were "Successor Servicers" under this Agreement.
(b) Promptly after receipt by an indemnified party under this Section
14.01 of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party under
this Section 14.01, notify the indemnifying party in writing of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
the indemnifying party from any liability which it may have to any indemnified
party under this Section 14.01, except to the extent that it has been prejudiced
in any material respect, or from any liability which it may have, otherwise than
under this Section 14.01. In case any such action is brought against any
indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein, and to
the extent that it may elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice from such indemnified party,
to assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party; provided that if the defendants in any such action include
both the indemnified party and the indemnifying party and the indemnified party
or parties shall have reasonably concluded that there may be legal defenses
available to it or them and/or other indemnified parties which 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
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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 counsel, the indemnifying party
will not be liable to such indemnified party for expenses incurred by the
indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in connection with the
assertion of legal defenses in accordance with the proviso to the next preceding
sentence (it being understood, however, that the indemnifying party shall not be
liable for the expenses of more than one separate counsel (together with one
local counsel, if applicable)), (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 has authorized in writing the
employment of counsel for the indemnified party at the expense of the
indemnifying party; and except that, if clause (i) or (iii) is applicable, such
liability shall be only in respect of the counsel referred to in such clause (i)
or (iii).
Subsection 14.02. Merger or Consolidation of the Seller.
The Seller will keep in full effect its existence, rights and
franchises as a corporation under the laws of the state of its incorporation
except as permitted herein, and will obtain and preserve its qualification to do
business as a foreign corporation 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.
Any Person into which the Seller may be merged or consolidated, or any
corporation resulting from any merger, conversion or consolidation to which the
Seller shall be a party, or any Person succeeding to the business of the Seller,
shall be the successor of the Seller 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
successor or surviving Person shall have a net worth of at least $30,000,000.
SECTION 15. Financial Statements.
The Seller understands that in connection with the Purchaser's
marketing of the Mortgage Loans, the Purchaser shall make available to
prospective purchasers audited financial statements of the Seller for the most
recently completed three fiscal years respecting which such statements are
available, as well as a Consolidated Statement of Condition of the Seller at the
end of the last two fiscal years covered by such Consolidated Statement of
Operations. The Seller shall also make available any comparable interim
statements to the extent any such statements have been prepared by the Seller
(and are available upon request to members or stockholders of the Seller or the
public at large). The Seller, if it has not already done so, agrees to furnish
promptly to the Purchaser copies of the statements specified above. The Seller
shall also make available information on its servicing performance with respect
to loans serviced for others, including delinquency ratios.
The Seller also agrees to allow reasonable access to a knowledgeable
financial or accounting officer for the purpose of answering questions asked by
any prospective purchaser regarding recent developments affecting the Seller or
the financial statements of the Seller.
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SECTION 16. Mandatory Delivery; Grant of Security Interest.
The sale and delivery on the related Closing Date of the Mortgage
Loans described on the related Mortgage Loan Schedule is mandatory from and
after the date of the execution of the related Purchase Price and Terms
Agreement, it being specifically understood and agreed that each Mortgage Loan
is unique and identifiable on the date hereof and that an award of money damages
would be insufficient to compensate the Purchaser for the losses and damages
incurred by the Purchaser (including damages to prospective purchasers of the
Mortgage Loans) in the event of the Seller's failure to deliver (i) each of the
related Mortgage Loans or (ii) one or more Qualified Substitute Mortgage Loans
or (iii) one or more Mortgage Loans otherwise acceptable to the Purchaser on or
before the related Closing Date. The Seller hereby grants to the Purchaser a
lien on and a continuing security interest in each Mortgage Loan and each
document and instrument evidencing each such Mortgage Loan to secure the
performance by the Seller of its obligations under the related Purchase Price
and Terms Agreement, and the Seller agrees that it shall hold such Mortgage
Loans in custody for the Purchaser subject to the Purchaser's (i) right to
reject any Mortgage Loan (or Qualified Substitute Mortgage Loan) under the terms
of this Agreement and to require another Mortgage Loan (or Qualified Substitute
Mortgage Loan) to be substituted therefor, and (ii) obligation to pay the
Purchase Price for the Mortgage Loans. All rights and remedies of the Purchaser
under this Agreement are distinct from, and cumulative with, any other rights or
remedies under this Agreement or afforded by law or equity and all such rights
and remedies may be exercised concurrently, independently or successively.
SECTION 17. Notices.
All demands, notices and communications hereunder shall be in writing
and shall be given via email, facsimile transmission or registered or certified
mail to the person at the address set forth below:
(i) if to the Seller:
First NLC Financial Services, LLC
000 Xxxx Xxxxxxxxx
Xxxxxxxxx, Xxxxxxxx 0
Xxxxxxxxx Xxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxxxxxx and Xxxxxx Xxxxx
Fax: 000-000-0000
Email: xxxxxx@xxxxxxxx.xxx,
xxxxxxxxx@xxxxxxxx.xxx
(ii) if to the Purchaser:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx Xxxxxxxx
Fax: 000-000-0000
Email: x.xxxxxxxx@xxxxxx.xxx
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with a copy to:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Fax: 000-000-0000
Email: xxxxxx.xxxxx@xxxxxx.xxx
or such other address as may hereafter be furnished to the other party by like
notice. Any such demand, notice or communication hereunder shall be deemed to
have been received on the date delivered to or received at the premises of the
addressee (as evidenced, in the case of registered or certified mail, by the
date noted on the return receipt).
SECTION 18. Severability Clause.
Any part, provision representation or warranty of this Agreement which
is prohibited or unenforceable or is held to be void or unenforceable in any
jurisdiction shall be ineffective, as to such jurisdiction, to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction as to any Mortgage Loan shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by applicable law, the parties hereto waive any provision of law which prohibits
or renders void or unenforceable any provision hereof. If the invalidity of any
part, provision, representation or warranty of this Agreement shall deprive any
party of the economic benefit intended to be conferred by this Agreement, the
parties shall negotiate, in good-faith, to develop a structure the economic
effect of which is nearly as possible the same as the economic effect of this
Agreement without regard to such invalidity.
SECTION 19. Counterparts.
This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original, and all such
counterparts shall constitute one and the same instrument.
SECTION 20. Governing Law Jurisdiction; Consent to Service of Process.
THIS AGREEMENT SHALL BE DEEMED IN EFFECT WHEN A FULLY EXECUTED
COUNTERPART THEREOF IS RECEIVED BY THE PURCHASER IN THE STATE OF NEW YORK AND
SHALL BE DEEMED TO HAVE BEEN MADE IN THE STATE OF NEW YORK. THIS AGREEMENT SHALL
BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT
TO ITS CHOICE OF LAW RULES AND PRINCIPLES. EACH OF THE PURCHASER AND THE SELLER
IRREVOCABLY (I) SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE
STATE OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE
SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT; (II) WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW,
THE DEFENSE OF AN
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INCONVENIENT FORUM IN ANY ACTION OR PROCEEDING IN ANY SUCH COURT; (III) AGREES
THAT A FINAL JUDGMENT IN ANY ACTION OR PROCEEDING IN ANY SUCH COURT SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION BY SUIT ON THE JUDGMENT
OR IN ANY OTHER MANNER PROVIDED BY LAW; AND (IV) CONSENTS TO SERVICE OF PROCESS
UPON IT BY MAILING A COPY THEREOF BY CERTIFIED MAIL ADDRESSED TO IT AS PROVIDED
FOR NOTICES HEREUNDER.
SECTION 21. Intention of the Parties.
It is the intention of the parties that the Purchaser is purchasing,
and the Seller is selling the Mortgage Loans and not a debt instrument of the
Seller or another security. Accordingly, the parties hereto each intend to treat
the transaction for Federal income tax purposes as a sale by the Seller, and a
purchase by the Purchaser, of the Mortgage Loans. Moreover, the arrangement
under which the Mortgage Loans are held shall be consistent with classification
of such arrangement as a grantor trust in the event it is not found to represent
direct ownership of the Mortgage Loans. The Purchaser shall have the right to
review the Mortgage Loans and the related Mortgage Loan Files to determine the
characteristics of the Mortgage Loans which shall affect the Federal income tax
consequences of owning the Mortgage Loans and the Seller shall cooperate with
all reasonable requests made by the Purchaser in the course of such review.
SECTION 22. Successors and Assigns; Assignment of Purchase Agreement.
This Agreement shall bind and inure to the benefit of and be
enforceable by the Seller and the Purchaser and the respective permitted
successors and assigns of the Seller and the successors and assigns of the
Purchaser. This Agreement shall not be assigned, pledged or hypothecated by the
Seller to a third party without the prior written consent of the Purchaser,
which consent may be withheld by the Purchaser in its sole discretion. This
Agreement may be assigned, pledged or hypothecated by the Purchaser in whole or
in part, and with respect to one or more of the Mortgage Loans, without the
consent of the Seller. There shall be no limitation on the number of assignments
or transfers allowable by the Purchaser with respect to the Mortgage Loans and
this Agreement. In the event the Purchaser assigns this Agreement, and the
assignee assumes any of the Purchaser's obligations hereunder, the Seller
acknowledges and agrees to look solely to such assignee, and not to the
Purchaser, for performance of the obligations so assumed and the Purchaser shall
be relieved from any liability to the Seller with respect thereto.
SECTION 23. Waivers.
No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced.
SECTION 24. Exhibits.
The exhibits to this Agreement are hereby incorporated and made a part
hereof and are an integral part of this Agreement.
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SECTION 25. General Interpretive 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) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;
(c) 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;
(d) 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;
(e) 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
(f) the term "include" or "including" shall mean without limitation by
reason of enumeration.
SECTION 26. Reproduction of Documents.
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications which may hereafter be
executed, (b) documents received by any party at the closing, and (c) financial
statements, certificates and other information previously or hereafter
furnished, may be reproduced by any photographic, photostatic, microfilm,
micro-card, miniature photographic or other similar process. The parties agree
that any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding, whether or not the original
is in existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
SECTION 27. Further Agreements.
The Seller and the Purchaser each agree to execute and deliver to the
other such reasonable and appropriate additional documents, instruments or
agreements as may be necessary or appropriate to effectuate the purposes of this
Agreement.
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SECTION 28. Recordation of Assignments of Mortgage.
To the extent permitted by applicable law, each of the Assignments of
Mortgage is subject to recordation in all appropriate public offices for real
property records in all the counties or their comparable jurisdictions in which
any or all of the Mortgaged Properties are situated, and in any other
appropriate public recording office or elsewhere, such recordation to be
effected at the Seller's expense in the event recordation is either necessary
under applicable law or requested by the Purchaser at its sole option (other
than with respect to the MERS Designated Mortgage Loans).
SECTION 29. No Solicitation.
From and after the Closing Date, the Seller agrees that it will not
take any action or permit or cause any action to be taken by any of its agents
or affiliates, or by any independent contractors on the Seller's behalf, to
personally, by telephone or mail (via electronic means or otherwise), solicit
the borrower or obligor under any Mortgage Loan for any purpose whatsoever,
including to refinance a Mortgage Loan, in whole or in part, without the prior
written consent of the Purchaser. It is understood and agreed that all rights
and benefits relating to the solicitation of any Mortgagors and the attendant
rights, title and interest in and to the list of such Mortgagors and data
relating to their Mortgages (including insurance renewal dates) shall be
transferred to the Purchaser pursuant hereto on the Closing Date and the Seller
shall take no action to undermine these rights and benefits. Notwithstanding the
foregoing, it is understood and agreed that (i) promotions undertaken by the
Seller or any affiliate of the Seller which are directed to the general public
at large, including, without limitation, mass mailing based on commercially
acquired mailing lists, newspaper, radio and television advertisements shall not
constitute solicitation under this Section 29 and (ii) any solicitation in any
manner from a publicly purchased list shall not constitute solicitation under
this Section 29; provided that the publicly purchased list was purchased after
the origination date of the related Mortgage Loan.
SECTION 30. Waiver of Trial by Jury.
THE SELLER AND THE PURCHASER EACH KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR RELATING TO THIS
AGREEMENT.
SECTION 31. Compliance with Regulation AB.
Subsection 31.01. Intent of the Parties; Reasonableness.
The Purchaser and the Seller acknowledge and agree that the purpose of
Section 31 of this Agreement 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 Seller 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.
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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 Seller 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, subject to
Section 1105(f) of Regulation AB. In connection with any Securitization
Transaction, the Seller 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
Seller, 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, subject to Section 1105(f) of
Regulation AB.
The Purchaser (including any of its assignees or designees) shall
cooperate with the Seller 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.
Subsection 31.02. Additional Representations and Warranties of the
Seller.
(a) The Seller shall be deemed to represent to the Purchaser and to
any Depositor, as of the date on which information is first provided to the
Purchaser or any Depositor under Subsection 31.03 that, except as disclosed in
writing to the Purchaser or such Depositor prior to such date: (i) the Seller 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 Seller; (ii) the Interim Servicer 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; (iii) no material noncompliance with the applicable servicing
criteria with respect to other securitizations of residential mortgage loans
involving the Interim Servicer as servicer has been disclosed or reported by the
Seller; (iv) no material changes to the Interim Servicer's policies or
procedures with respect to the servicing function it will perform under the
Interim Servicing 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; (v) there
are no aspects of the Interim Servicer's financial condition that could have a
material adverse effect on the performance by the Interim Servicer of its
servicing obligations under the Interim Servicing Agreement or any
Reconstitution Agreement; (vi) there are no material legal or governmental
proceedings pending (or known to be contemplated) against the Seller, Interim
Servicer, any Subservicer or any Third-Party Originator; and (vii) there are no
affiliations, relationships or transactions relating to the Seller, Interim
Servicer, any Subservicer or any Third-Party
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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 or any Depositor on any date
following the date on which information is first provided to the Purchaser or
any Depositor under Subsection 31.03, the Seller shall, within five (5) Business
Days following such request, confirm in writing the accuracy of the
representations and warranties set forth in paragraph (a) of this Section 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.
Subsection 31.03. Information to Be Provided by the Seller.
In connection with any Securitization Transaction the Seller shall (i)
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 to provide), in writing and in form and substance
reasonably satisfactory to the Purchaser and such Depositor, the information and
materials specified in paragraphs (a) and (b) of this Section, and (ii) as
promptly as practicable following notice to or discovery by the Seller, 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 (d) of this Section.
(a) If so requested by the Purchaser or any Depositor, the Seller
shall provide such information regarding (i) the Seller, as originator of the
Mortgage Loans (including as an acquirer of Mortgage Loans from a Qualified
Correspondent), or (ii) each Third-Party Originator, 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) the originator's form of organization;
(B) 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 or any Depositor, 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;
(C) a description of any material legal or governmental
proceedings pending (or known to be contemplated) against the Seller and
each Third-Party Originator; and
(D) a description of any affiliation or relationship between the
Seller, each Third-Party Originator and any of the following parties to a
Securitization Transaction, as such parties are identified to the Seller by
the Purchaser or any Depositor in writing in advance of such Securitization
Transaction:
(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.
(b) If so requested by the Purchaser or any Depositor, the Seller
shall use reasonable good faith efforts to acquire, and to the extent the data
is available to Seller, to 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 (i) the Seller, if the Seller is an
originator of Mortgage Loans (including as an acquirer of Mortgage Loans from a
Qualified Correspondent), and/or (ii) each Third-Party Originator. Such Static
Pool Information shall be prepared by the Seller (or Third-Party Originator) on
the basis of its reasonable, good faith
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interpretation of the requirements of Item 1105(a)(1)-(3) of Regulation AB. To
the extent that there is reasonably available to the Seller (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 Seller, 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 one hundred thirty-five (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.
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 Seller 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
Seller.
If so requested by the Purchaser or any Depositor, the Seller 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 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
Seller'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 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.
(c) [Reserved].
(d) 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 Seller shall (or shall cause each
Third-Party Originator to) (i) notify the Purchaser and any Depositor in writing
of (A) any material litigation or governmental proceedings pending against the
Seller or any Third-Party Originator and (B) any affiliations or relationships
that develop following the closing date of a Securitization Transaction between
the Seller or any Third-Party Originator and any of the parties specified in
clause (D) of paragraph
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(a) of this Section (and any other parties identified in writing by the
requesting party) with respect to such Securitization Transaction, and (ii)
provide to the Purchaser and any Depositor a description of such proceedings,
affiliations or relationships.
(e) With respect to those Mortgage Loans that were originated by the
Seller (including as an acquirer of Mortgage Loans from a Qualified
Correspondent) and sold to the Purchaser pursuant to this Agreement, the
Purchaser shall, to the extent consistent with then-current industry practice,
cause the servicer (or another party) to be obligated to provide information, in
the form customarily provided by such servicer or other party (which need not be
customized for the Seller) with respect to the Mortgage Loans reasonably
necessary for the Seller to comply with its obligations under regulation AB,
including, without limitation, providing to the Seller static pool information,
as set forth in Item 1105(a)(2), provided in the manner specified in Item
1105(a)(3) of Regulation AB (such information provided by the servicer or such
other party, the "Loan Performance Information").
Subsection 31.04. Indemnification; Remedies.
(a) The Seller shall indemnify the Purchaser, each affiliate of the
Purchaser, the Depositor 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:
(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 this Section 31 by or on behalf of the Seller, or provided under
this Section 31 by or on behalf of any Third-Party Originator
(collectively, the "Seller Information"), or (B) the omission or alleged
omission to state in the Seller Information a material fact required to be
stated in the Seller 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 Seller
Information and not to any other information communicated in connection
with a sale or purchase of securities, without regard to whether the Seller
Information or any portion thereof is presented together with or separately
from such other information;
(ii) any failure by the Seller or any Third-Party Originator to
deliver any information, report, certification, accountants' letter or
other material when and as required under this Section 31; or
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(iii) any breach by the Seller of a representation or warranty
set forth in Subsection 31.02(a) or in a writing furnished pursuant to
Subsection 31.02(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 Seller of a representation
or warranty in a writing furnished pursuant to Subsection 31.02(b) to the
extent made as of a date subsequent to such closing date.
In the case of any failure of performance described in clause (a)(ii)
of this Section, the Seller 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 Seller or
any Third-Party Originator.
(b) (i) Any failure by the Seller or any Third-Party Originator to
deliver any information, report, certification, accountants' letter or other
material when and as required under this Section 31, or any breach by the Seller
of a representation or warranty set forth in Subsection 31.02(a) or in a writing
furnished pursuant to Subsection 31.02(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 Seller of a
representation or warranty in a writing furnished pursuant to Subsection
31.02(b) to the extent made as of a date subsequent to such closing date, shall
immediately and automatically, without notice or grace period, constitute an
Event of Default with respect to the Seller 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 Interim Servicer as servicer under the Interim Servicing
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 Interim Servicer; 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 Interim Servicer as servicer, such
provision shall be given effect.
(c) The Purchaser shall indemnify the Sellers, each affiliate of the
Sellers and the respective present and former directors, officers, employees and
agents of each of the foregoing, 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:
(i) (A) any untrue statement of a material fact contained or alleged
to be contained in the Loan Performance Information or (B) the omission or
alleged omission to state in the Loan Performance Information a material
fact required to be stated in the Loan Performance 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 Loan Performance Information and not to any other
information
-59-
communicated in connection with a sale or purchase of securities, without
regard to whether the Loan Performance Information or any portion thereof
is presented together with or separately from such other information; or
(ii) any failure by the Purchaser or by the related servicer to
deliver any Loan Performance Information as required under Subsection
31.03(e).
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
-60-
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed hereto by their respective officers thereunto duly authorized
as of the date first above written.
IXIS REAL ESTATE CAPITAL INC.
(Purchaser)
By: /s/ Xxxxxxx Xxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Managing Director
By: /s/ Xxxxx Xxxxx
------------------------------------
Name: Xxxxx Xxxxx
Title: Director
FIRST NLC FINANCIAL SERVICES, LLC
(Seller)
By: /s/ Xxxxxx Xxxxxxx
------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Sr. Vice President
EXHIBIT A
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 delivered to the
Custodian, or to such other Person as the Purchaser shall designate in writing,
pursuant to Section 6 of the Mortgage Loan Purchase and Warranties Agreement to
which this Exhibit is attached (the "Agreement"):
(a) the original Mortgage Note bearing all intervening endorsements
evidencing a complete chain of assignment from the originator to the Seller,
endorsed "Pay to the order of _________, without recourse" and signed in the
name of the Seller by an authorized officer. To the extent that there is no room
on the face of the Mortgage Notes for endorsements, the endorsement may be
contained on an allonge, if state law so allows and the Custodian is so advised
by the Seller that state law so allows. If the Mortgage Loan was acquired by the
Seller in a merger, the endorsement must be by "[Seller], successor by merger to
[name of predecessor]." If the Mortgage Loan was acquired or originated by the
Seller while doing business under another name, the endorsement must be by
"[Seller], formerly known as [previous name]";
(b) the original of any guarantee executed in connection with the
Mortgage Note;
(c) the original Mortgage with evidence of recording thereon. If in
connection with any Mortgage Loan, the Seller 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 Seller 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
Seller 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 Seller; 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 to be
a true and complete copy of the original recorded Mortgage;
(d) the originals of all assumption, modification, consolidation or
extension agreements, if any, with evidence of recording thereon;
(e) except with respect to each MERS Designated Mortgage Loan, the
original Assignment of Mortgage for each Mortgage Loan, in form and substance
acceptable for recording. The Assignment of Mortgage must be duly recorded only
if recordation is either
A-1
necessary under applicable law or commonly required by private institutional
mortgage investors in the area where the Mortgaged Property is located or on
direction of the Purchaser as provided in this Agreement. If the Assignment of
Mortgage is to be recorded, the Mortgage shall be assigned to the Purchaser. If
the Assignment of Mortgage is not to be recorded, the Assignment of Mortgage
shall be delivered in blank. If the Mortgage Loan was acquired by the Seller in
a merger, the Assignment of Mortgage must be made by "[Seller], successor by
merger to [name of predecessor]". If the Mortgage Loan was acquired or
originated by the Seller while doing business under another name, the Assignment
of Mortgage must be by "[Seller], formerly known as [previous name]";
(f) the originals of all intervening assignments of mortgage,
evidencing a complete chain of assignment from the originator to the Seller (or
MERS with respect to each MERS Designated Mortgage Loan), 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
Seller 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 Seller 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 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 Seller; 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;
(g) The original mortgagee policy of title insurance or, in the event
such original title policy is unavailable, a certified true copy of the related
policy binder or commitment for title certified to be true and complete by the
title insurance company; and
(h) security agreement, chattel mortgage or equivalent document
executed in connection with the Mortgage.
In the event an Officer's Certificate of the Seller is delivered to
the Purchaser because of a delay caused by the public recording office in
returning any recorded document, the Seller shall deliver to the Purchaser,
within 90 days of the 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; provided, however, that any recorded document shall
in any event be delivered no later than one year from the applicable Closing
Date. An extension of the date specified in (iv) above may be requested from the
Purchaser, which consent shall not be unreasonably withheld.
A-2
EXHIBIT B
FORM OF INTERIM SERVICING AGREEMENT
B-1
EXHIBIT C
FORM OF SELLER'S OFFICER'S CERTIFICATE
I, ____________________, hereby certify that I am the duly elected
[Vice] President of ________________[COMPANY], a [state] [federally] chartered
institution organized under the laws of the [state of ____________] [United
States] (the "Company"), and further as follows:
1. Attached hereto as Exhibit 1 is a true, correct and complete copy
of the charter of the Company which is in full force and effect on the date
hereof and which has been in effect without amendment, waiver, rescission or
modification since ___________.
2. Attached hereto as Exhibit 2 is a true, correct and complete copy
of the bylaws of the Company which are in effect on the date hereof and which
have been in effect without amendment, waiver, rescission or modification since
___________.
3. Attached hereto as Exhibit 3 is an original certificate of good
standing of the Company issued within ten days of the date hereof, and no event
has occurred since the date thereof which would impair such standing.
4. Attached hereto as Exhibit 4 is a true, correct and complete copy
of the corporate resolutions of the Board of Directors of the Company
authorizing the Company to execute and deliver [each of [the Mortgage Loan
Purchase and Warranties Agreement, dated as of _______ __, ____, by and between
IXIS Real Estate Capital Inc. (the "Purchaser") and the Company (the "Purchase
Agreement"),] [the Interim Servicing Agreement, dated as of _______ __, ____, by
and between the Company and the Purchaser (the "Interim Servicing Agreement")]
[and to endorse the Mortgage Notes and execute the Assignments of Mortgages by
original [or facsimile] signature,]] and such resolutions are in effect on the
date hereof and have been in effect without amendment, waiver, rescission or
modification since ______________.
5. 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 [Purchase
Agreement and the Interim Servicing Agreement,] the sale of the mortgage loans
or the consummation of the transactions contemplated by the agreements; or (ii)
any required consent, approval, authorization or order has been obtained by the
Company.
6. Neither the consummation of the transactions contemplated by, nor
the fulfillment of the terms of the [Purchase Agreement and the Interim
Servicing Agreement] conflicts or will conflict with or results 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 any statute or order, rule, regulations,
C-1
writ, injunction or decree of any court, governmental authority or regulatory
body to which the Company is subject or by which it is bound.
7. To the best of my knowledge, there is no action, suit, proceeding
or investigation pending or threatened against the Company which, in my
judgment, 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 [Purchase Agreement and the Interim
Servicing Agreement,] or the mortgage loans or of any action taken or to be
taken in connection with the transactions contemplated hereby, or which would be
likely to impair materially the ability of the Company to perform under the
terms of the [Purchase Agreement and the Interim Servicing Agreement].
8. Each person listed on Exhibit 5 attached hereto who, as an officer
or representative of the Company, signed (a) the Purchase Agreement, (b) the
Interim Servicing Agreement and (c) any other document delivered or on the date
hereof in connection with any purchase described in the agreements set forth
above was, at the respective times of such signing and delivery, and is now, a
duly elected or appointed, qualified and acting officer or representative of the
Company, who holds the office set forth opposite his or her name on Exhibit 5,
and the signatures of such persons appearing on such documents are their genuine
signatures.
9. The Company is duly authorized to engage in the transactions
described and contemplated in the [Purchase Agreement, the Interim Servicing
Agreement and the Custodial Agreement].
C-2
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the
seal of the Company.
Dated: By:
------------------------------ ------------------------------------
Name:
[Seal] Title: [Vice] President
I, ________________________, an [Assistant] Secretary of
______________[COMPANY], hereby certify that ____________ is the duly elected,
qualified and acting [Vice] President of the Company and that the signature
appearing above is [her] [his] genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated: By:
------------------------------ ------------------------------------
Name:
Title: [Assistant] Secretary
C-3
EXHIBIT 5 to
Company's Officer's Certificate
NAME TITLE SIGNATURE
---------------------------- -------------------- --------------------------
____________________________ ____________________ __________________________
____________________________ ____________________ __________________________
____________________________ ____________________ __________________________
____________________________ ____________________ __________________________
____________________________ ____________________ __________________________
____________________________ ____________________ __________________________
C-4
EXHIBIT D
FORM OF OPINION OF COUNSEL TO THE SELLER
AND INTERIM SERVICER (DATE)
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
You have requested [our] [my] opinion, as [Assistant] General Counsel
to ___________________ (the "Company"), with respect to certain matters in
connection with the sale by the Company of the Mortgage Loans pursuant to that
certain Mortgage Loan Purchase and Warranties Agreement by and between the
Company and IXIS Real Estate Capital Inc. (the "Purchaser"), dated as of
_________ __, ____ (the "Purchase Agreement") which sale is in the form of whole
loans, delivered pursuant to a Custodial Agreement dated as of _____ __, ____
among the Purchaser, the Company, ________________________ (the "Interim
Servicer") and ______________________[CUSTODIAN] (the "Custodial Agreement") and
serviced pursuant to an Interim Servicing Agreement, dated as of ______ __, ____
by and between the Interim Servicer and the Purchaser (the "Interim Servicing
Agreement" and, collectively with the Purchase Agreement and the Custodial
Agreement, the "Agreements"). Capitalized terms not otherwise defined herein
have the meanings set forth in the Purchase Agreement and the Interim Servicing
Agreement.
[We] [I] have examined the following documents:
1. the Purchase Agreement;
2. the Interim Servicing Agreement;
3. the Custodial Agreement;
4. the form of Assignment of Mortgage;
5. the form of endorsement of the Mortgage Notes; and
6. such other documents, records and papers as we have deemed
necessary and relevant as a basis for this opinion.
To the extent [we] [I] have deemed necessary and proper, [we] [I] have
relied upon the representations and warranties of the Company and the Interim
Servicer contained in the Purchase Agreement and in the Interim Servicing
Agreement, as applicable. [We] [I] have assumed the authenticity of all
documents submitted to [us] [me] as originals, the genuineness of all
signatures, the legal capacity of natural persons and the conformity to the
originals of all documents.
D-1
Based upon the foregoing, it is [our] [my] opinion that:
1. The Company and the Interim Servicer is [type of entity] duly
organized, validly existing and in good standing under the laws
of the [United States] and are qualified to transact business in,
and is in good standing under, the laws of [the state of
incorporation].
2. Each of the Company and the Interim Servicer has the power to
engage in the transactions contemplated by the Agreements to
which it is a party and all requisite power, authority and legal
right to execute and deliver such Agreements and to perform and
observe the terms and conditions of such Agreements.
3. Each of the Agreements to which it is a party has been duly
authorized, executed and delivered by the Company and the Interim
Servicer, as applicable, and is a legal, valid and binding
agreement enforceable in accordance with its respective terms
against the Company and the Interim Servicer, as applicable,
subject to bankruptcy laws and other similar laws of general
application affecting rights of creditors 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.
4. Each of the Company and the Interim Servicer has been duly
authorized to allow any of its officers to execute any and all
documents by original signature in order to complete the
transactions contemplated by the Agreements to which it is a
party by original [or facsimile] signature in order to execute
the endorsements to the Mortgage Notes and the Assignments of
Mortgages, and the original [or facsimile] signature of the
officer at the Company executing the endorsements to the Mortgage
Notes and the Assignments of Mortgages represents the legal and
valid signature of said officer of the Company.
5. 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 or the Interim
Servicer of or compliance by the Company or the Interim Servicer
with the Agreements to which it is a party and the sale of the
Mortgage Loans by the Company or the consummation of the
transactions contemplated by the Agreements to which each is a
party or (ii) any required consent, approval, authorization or
order has been obtained by the Company or the Interim Servicer.
6. Neither the consummation of the transactions contemplated by, nor
the fulfillment of the terms of, the Agreements to which it is a
party conflicts or will conflict with or results or will result
in a breach of or constitutes or will constitute a default under
the charter, by-laws or other organizational
D-2
documents of the Company or the Interim Servicer, as applicable,
the terms of any indenture or other agreement or instrument to
which the Company or the Interim Servicer 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 or the Interim Servicer is subject or by which it is
bound.
7. There is no action, suit, proceeding or investigation pending or
threatened against the Company or the Interim Servicer which, in
[our] [my] judgment, 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 the Interim Servicer or in any material
impairment of the right or ability of the Company or the Interim
Servicer to carry on its business substantially as now conducted
or in any material liability on the part of the Company or the
Interim Servicer or which would draw into question the validity
of the Agreements to which it is a party or the Mortgage Loans or
of any action taken or to be taken in connection with the
transactions contemplated thereby, or which would be likely to
impair the ability of the Company or the Interim Servicer to
perform under the terms of the Agreements to which it is a party.
8. The sale of each Mortgage Note and Mortgage as and in the manner
contemplated by the Agreements is sufficient to fully transfer to
the Purchaser all right, title and interest of the Company
thereto as noteholder and mortgagee.
9. The Mortgages have been duly assigned and the Mortgage Notes have
been duly endorsed as provided in the Custodial Agreement. The
Assignments of Mortgage are in recordable form, except for the
insertion of the name of the assignee, and upon the name of the
assignee being inserted, are acceptable for recording under the
laws of the state where each related Mortgaged Property is
located. The endorsement of the Mortgage Notes, the delivery to
the Purchaser, or its designee, of the Assignments of Mortgage,
and the delivery of the original endorsed Mortgage Notes to the
Purchaser, or its designee, are sufficient to permit the
Purchaser to avail itself of all protection available under
applicable law against the claims of any present or future
creditors of the Company, and are sufficient to prevent any other
sale, transfer, assignment, pledge or hypothecation of the
Mortgages and the Mortgage Notes by the Company from being
enforceable.
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.
D-3
Very truly yours,
----------------------------------------
[Name]
[Assistant] General Counsel
D-4
EXHIBIT E
FORM OF SECURITY RELEASE CERTIFICATION
___________________, _____
____________________________
____________________________
____________________________
Attention: ___________________________
___________________________
Re: Notice of Sale and Release of Collateral
Dear Sirs:
This letter serves as notice that ________________________ [COMPANY] a
[type of entity], organized pursuant to the laws of [the state of incorporation]
(the "Company") has committed to sell to IXIS Real Estate Capital Inc. under
that certain Third Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of May 1, 2006, certain mortgage loans originated by the
Company. The Company warrants that the mortgage loans to be sold to IXIS Real
Estate Capital Inc. are in addition to and beyond any collateral required to
secure advances made by you to the Company.
The Company acknowledges that the mortgage loans to be sold to IXIS
Real Estate Capital Inc. shall not be used as additional or substitute
collateral for advances made by [____________]. IXIS Real Estate Capital Inc.
understands that the balance of the Company's mortgage loan portfolio may be
used as collateral or additional collateral for advances made by [___________],
and confirms that it has no interest therein.
E-1
Execution of this letter by [___________] shall constitute a full and
complete release of any security interest, claim, or lien which [___________]
may have against the mortgage loans to be sold to IXIS Real Estate Capital Inc.
Very truly yours,
----------------------------------------
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Date:
----------------------------------
Acknowledged and approved:
----------------------------------------
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Date:
----------------------------------
E-2
EXHIBIT F
FORM OF SECURITY RELEASE CERTIFICATION
I. Release of Security Interest
The financial institution named below hereby relinquishes any and all
right, title and interest it may have in all Mortgage Loans to be purchased by
IXIS Real Estate Capital Inc. from the Company named below pursuant to that
certain Third Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of May 1, 2006, and certifies that all notes, mortgages,
assignments and other documents in its possession relating to such Mortgage
Loans have been delivered and released to the Company named below or its
designees, as of the date and time of the sale of such Mortgage Loans to IXIS
Real Estate Capital Inc.
Name and Address of Financial Institution
----------------------------------------
(Name)
----------------------------------------
(Address)
By:
------------------------------------
F-1
II. Certification of Release
The Company named below hereby certifies to IXIS Real Estate Capital
Inc. that, as of the date and time of the sale of the above-mentioned Mortgage
Loans to IXIS Real Estate Capital Inc. the security interests in the Mortgage
Loans released by the above-named financial institution comprise all security
interests relating to or affecting any and all such Mortgage Loans. The Company
warrants that, as of such time, there are and will be no other security
interests affecting any or all of such Mortgage Loans.
----------------------------------------
By:
------------------------------------
Title:
---------------------------------
Date:
----------------------------------
F-2
EXHIBIT G
[RESERVED]
X-0
XXXXXXX X
XXXXXXXXXX XXX XXXXXXXXXX
Xx this ___ day of __________, ____, First NLC Financial Services, LLC
("Seller"), as (i) the Seller under that certain Purchase Price and Terms
Agreement, dated as of ___________, _____ (the "PPTA"), (ii) the Seller under
that certain Third Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of May 1, 2006 (the "Purchase Agreement") and (iii) the
Seller/Interim Servicer under that certain Second Amended and Restated Interim
Servicing Agreement, dated as of November 1, 2005 (the "Interim Servicing
Agreement" and, together with the PPTA and the Purchase Agreement, the
"Agreements") does hereby sell, transfer, assign, set over and convey to IXIS
Real Estate Capital Inc. ("Purchaser") as the Purchaser under the Agreements,
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"), together with the
Mortgage Files and all rights and obligations arising under the documents
contained therein. Each Mortgage Loan subject to the Agreements was underwritten
in accordance with, and conforms to, the Underwriting Guidelines attached hereto
as Exhibit C. Pursuant to Section 6 of the Purchase Agreement, the Seller has
delivered to the Custodian the documents for each Mortgage Loan to be purchased
as set forth in the Custodial Agreement. The contents of each Servicing File
required to be retained by First NLC Financial Services, LLC ("Interim
Servicer") to service the Mortgage Loans pursuant to the Interim Servicing
Agreement and thus not delivered to the Purchaser are and shall be held in trust
by the Seller in its capacity as Interim Servicer for the benefit of the
Purchaser as the owner thereof. The Interim Servicer's possession of any portion
of the Servicing File is at the will of the Purchaser for the sole purpose of
facilitating servicing of the related Mortgage Loan pursuant to the Interim
Servicing Agreement, and such retention and possession by the Interim Servicer
shall be in a custodial capacity only. The ownership of each Mortgage Note,
Mortgage, the Servicing Rights and the contents of the Mortgage File and
Servicing File is vested 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 Seller or the Interim Servicer shall immediately vest
in the Purchaser and shall be retained and maintained, in trust, by the Seller
at the will of the Purchaser in such custodial capacity only.
The Mortgage Loan Package characteristics of the Mortgage Loans
subject hereto are set forth on Exhibit B hereto.
In accordance with Section 6 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]
H-1
FIRST NLC FINANCIAL SERVICES, LLC
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Accepted and Agreed:
IXIS REAL ESTATE CAPITAL INC.
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
H-2
EXHIBIT A
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
THE MORTGAGE LOANS
H-3
EXHIBIT B
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE POOL
CHARACTERISTICS OF EACH MORTGAGE LOAN PACKAGE
Pool Characteristics of the Mortgage Loan Package as delivered on the
related Closing Date:
No Mortgage Loan has: (1) an outstanding principal balance less than
$_________; (2) an origination date earlier than _ months prior to the related
Cut-off Date; (3) a CLTV of greater than _____%; (4) a FICO Score of less than
___; or (5) a debt-to-income ratio of more than __%. Each First Lien Loan has a
Mortgage Interest Rate of at least ___% per annum and an outstanding principal
balance less than $_________. Each Second Lien Loan has a Mortgage Interest Rate
of at least ______% per annum and an outstanding principal balance less than
$________. Each Adjustable Rate Mortgage Loan has an Index of [_______].
H-4
EXHIBIT C
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
UNDERWRITING GUIDELINES
H-5
EXHIBIT I
SELLER'S UNDERWRITING GUIDELINES
I-1
EXHIBIT J
FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated [____________ __,
20__] ("Agreement"), among IXIS Real Estate Capital Inc. ("Assignor"),
[____________________] ("Assignee") and [SELLER] (the "Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns
to the Assignee all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain Mortgage Loan
Purchase and Warranties Agreement (the "Purchase Agreement"), dated as of
[DATE], between the Assignor, as purchaser (the "Purchaser"), and the Company,
as seller, solely insofar as the Purchase Agreement relates to the Mortgage
Loans.
The Assignor specifically reserves and does not assign to the Assignee
hereunder (i) any and all right, title and interest in, to and under and any
obligations of the Assignor with respect to any mortgage loans subject to the
Purchase Agreement which are not the Mortgage Loans set forth on the Mortgage
Loan Schedule and are not the subject of this Agreement or (ii) the rights of
the Purchaser under Section 9.04 of the Purchase Agreement.
Recognition of the Company
2. From and after the date hereof (the "Securitization Closing Date"),
the Company shall and does hereby recognize that the Assignee will transfer the
Mortgage Loans and assign its rights under the Purchase Agreement (solely to the
extent set forth herein) and this Agreement to [__________________] (the
"Trust") created pursuant to a Pooling and Servicing Agreement, dated as of
[______], 2002 (the "Pooling Agreement"), among the Assignee, the Assignor,
[___________________], as trustee (including its successors in interest and any
successor trustees under the Pooling Agreement, the "Trustee"),
[____________________], as servicer (including its successors in interest and
any successor servicer under the Pooling Agreement, the "Servicer"). The Company
hereby acknowledges and agrees that from and after the date hereof (i) the Trust
will be the owner of the Mortgage Loans, (ii) the Company shall look solely to
the Trust for performance of any obligations of the Assignor insofar as they
relate to the Mortgage Loans, (iii) the Trust (including the Trustee and the
Servicer acting on the Trust's behalf) shall have all the rights and remedies
available to the Assignor, insofar as they relate to the Mortgage Loans, under
the Purchase Agreement, including, without limitation, the enforcement of the
document delivery requirements set forth in Section 6 of the Purchase Agreement,
and shall be entitled to enforce all of the obligations of the Company
thereunder insofar as they relate to the Mortgage Loans, and (iv) all references
to the Purchaser, the
J-1
Custodian or the Bailee under the Purchase Agreement insofar as they relate to
the Mortgage Loans, shall be deemed to refer to the Trust (including the Trustee
and the Servicer acting on the Trust's behalf). Neither the Company nor the
Assignor shall amend or agree to amend, modify, waiver, or otherwise alter any
of the terms or provisions of the Purchase Agreement which amendment,
modification, waiver or other alteration would in any way affect the Mortgage
Loans or the Company's performance under the Purchase Agreement with respect to
the Mortgage Loans without the prior written consent of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee
and the Trust as of the date hereof that:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver and
perform its obligations under this Agreement and has full power and
authority to perform its obligations under the Purchase Agreement. The
execution by the Company of this Agreement is in the ordinary course of the
Company's business and will not conflict with, or result in a breach of,
any of the terms, conditions or provisions of the Company's charter or
bylaws or any legal restriction, or any material agreement or instrument to
which the Company is now a party or by which it is bound, or result in the
violation of any law, rule, regulation, order, judgment or decree to which
the Company or its property is subject. The execution, delivery and
performance by the Company of this Agreement have been duly authorized by
all necessary corporate action on part of the Company. This Agreement has
been duly executed and delivered by the Company, and, upon the due
authorization, execution and delivery by the Assignor and the Assignee,
will constitute the valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization, insolvency,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and by general principles of equity regardless
of whether enforceability is considered in a proceeding in equity or at
law;
(c) No consent, approval, order or authorization of, or declaration,
filing or registration with, any governmental entity is required to be
obtained or made by the Company in connection with the execution, delivery
or performance by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation pending or
threatened against the Company, before any court, administrative agency or
other tribunal, which would draw into question the validity of this
Agreement or the Purchase Agreement, or which, either in any one instance
or in the aggregate, would result in any material adverse change in the
ability of the Company to perform its obligations under this Agreement or
the Purchase Agreement, and the Company is solvent.
J-2
4. Pursuant to Section 13 of the Purchase Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust, that the representations and warranties set forth in Section 9.02
of the Purchase Agreement are true and correct as of the date hereof as if such
representations and warranties were made on the date hereof unless (i) otherwise
specifically stated in such representations and warranties or (ii) with respect
to the last sentence of (b), the first sentence of (c), (d), (e), the last
sentence of (f), (h), the last sentence of (i), (m), (n), the last sentence of
(p), (q), (r), the third and fourth sentences of (w), (x), (z), (hh), (ii),
(kk), (ll), (mm), (rr), (xx), (bbb) and (kkk), such representations and
warranties are true and correct as of the related Transfer Date (as defined in
the Purchase Agreement).
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee and
the Servicer acting on the Trust's behalf) in connection with any breach of the
representations and warranties made by the Company set forth in Sections 3 and 4
hereof shall be as set forth in Subsection 9.03 of the Purchase Agreement as if
they were set forth herein (including without limitation the repurchase and
indemnity obligations set forth therein).
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced, with the prior
written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors and
assigns of the parties hereto and (ii) the Trust (including the Trustee and the
Servicer acting on the Trust's behalf). Any entity into which Assignor, Assignee
or Company may be merged or consolidated shall, without the requirement for any
further writing, be deemed Assignor, Assignee or Company, respectively,
hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive the
conveyance of the Mortgage Loans and the assignment of the Purchase Agreement
(to the extent assigned hereunder) by Assignor to Assignee and by Assignee to
the Trust and nothing contained herein shall supersede or amend the terms of the
Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
J-3
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
J-4
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
[SELLER]
By:
------------------------------------
Name:
------------------------------
Its:
-------------------------------
IXIS REAL ESTATE CAPITAL INC.
By:
------------------------------------
Name:
------------------------------
Its:
-------------------------------
By:
------------------------------------
Name:
------------------------------
Its:
-------------------------------
[ ]
--------------------------
By:
------------------------------------
Name:
------------------------------
Its:
-------------------------------
J-5
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
MORTGAGE LOAN SCHEDULE
J-6
EXHIBIT K
FORM OF INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AND CONTRIBUTION AGREEMENT ("Agreement"), dated
as of [_______], 200_, [among/between] IXIS Real Estate Capital Inc., a New York
corporation ("IXIS"), [_____________], a [_______________] (the "Seller") and
[_____________], a [_______________] [(the "Initial Servicer")].
WHEREAS, [________________] (the "Depositor"), is acting as depositor
and registrant with respect to the Prospectus, dated [________________], and the
Prospectus Supplement to the Prospectus, [________________] (the "Prospectus
Supplement"), relating to [________________] Certificates (the "Certificates")
to be issued pursuant to a Pooling and Servicing Agreement, dated as of
[________________] (the "P&S"), among the Depositor, as depositor,
[________________], as servicer (the "Servicer"), and [________________], as
trustee (the "Trustee");
WHEREAS, as an inducement to the Depositor to enter into the P&S, and
[____________________] (the "Underwriter[s]") to enter into the Underwriting
Agreement, dated [____________________] (the "Underwriting Agreement") between
the Depositor and the Underwriter[s], Seller has agreed to provide for
indemnification and contribution on the terms and conditions hereinafter set
forth;
WHEREAS, IXIS purchased from Seller certain of the Mortgage Loans
underlying the Certificates (the "Mortgage Loans") from Seller pursuant to that
certain Third Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of May 1, 2006 (the "Purchase Agreement"), by and between
IXIS and Seller; and
WHEREAS, pursuant to Section 13 of the Purchase Agreement, Seller has
agreed to indemnify IXIS, the Depositor, the Underwriter[s] and their respective
affiliates, present and former directors, officers, employees and agents.
NOW THEREFORE, in consideration of the agreements contained herein,
and other valuable consideration the receipt and sufficiency of which are hereby
acknowledged, Seller and IXIS agree as follows:
1. Indemnification and Contribution.
(a) Seller [and Initial Servicer] agrees to indemnify and hold
harmless IXIS, the Depositor, the Underwriter[s] and their respective
affiliates, and their respective present and former directors, officers,
employees and agents and each person, if any, who controls IXIS, the Depositor,
the Underwriter[s] or such affiliates within the meaning of either Section 15 of
the Securities Act of 1933, as amended (the "1933 Act"), or Section 20 of the
Securities Exchange Act of 1934, as amended (the "1934 Act"), against any and
all losses, claims, damages or
K-1
liabilities, joint or several, to which they or any of them may become subject
under the 1933 Act, the 1934 Act or other federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based in
whole or in part upon (i) any violation of the representation and warranty set
forth in Section 2(vii) below or (ii) any untrue statement or alleged untrue
statement of a material fact contained in the Prospectus Supplement, ABS
Informational and Computational Material or in the Free Writing Prospectus or
any omission or alleged omission to state in the Prospectus Supplement, ABS
Informational and Computational Material or in the Free Writing Prospectus 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,
or any such untrue statement or omission or alleged untrue statement or alleged
omission made in any amendment of or supplement to the Prospectus Supplement,
ABS Informational and Computational Material or the Free Writing Prospectus and
agrees to reimburse IXIS, the Depositor, the Underwriter[s] or such affiliates
and each such officer, director, employee, agent and controlling person promptly
upon demand for any legal or other expenses reasonably incurred by any of them
in connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that Seller [and Initial Servicer] shall be liable in any
such case only to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission of a material fact made in reliance
upon and in conformity with the Seller Information[ and Servicer Information].
The foregoing indemnity agreement is in addition to any liability which Seller[
and the Initial Servicer] may otherwise have to IXIS, the Depositor, the
Underwriter[s] its affiliates or any such director, officer, employee, agent or
controlling person of IXIS, the Depositor, the Underwriter[s] or their
respective affiliates.
As used herein:
"ABS Informational and Computational Material" means any written
communication as defined in Item 1101(a) of Regulation AB under the 1933 Act and
the 1934 Act, as amended from time to time.
"Free Writing Prospectus" means any written communication that
constitutes a "free writing prospectus," as defined in Rule 405 under the 1933
Act.
"Regulation AB" means Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. Sections 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.
"Seller Information" means any information relating to Seller, the
Mortgage Loans and/or the underwriting guidelines[ and/or servicing guidelines]
relating to the Mortgage Loans set forth in the Prospectus Supplement, ABS
Informational and Computational Material or the Free Writing Prospectus [and
static pool information regarding mortgage loans originated or acquired by the
Seller [and included in the Prospectus Supplement, ABS Informational and
K-2
Computational Material, the Offering Circular or the Free Writing Prospectus]
[incorporated by reference from the website located at [______________]].
["Servicer Information" means any information relating to Initial
Servicer, the Mortgage Loans and/or the servicing guidelines relating to the
Mortgage Loans set forth in the Prospectus Supplement, ABS Informational and
Computational Material or the Free Writing Prospectus [and static pool
information regarding mortgage loans originated or acquired by the Initial
Servicer [and included in the Prospectus Supplement, the Offering Circular, ABS
Informational and Computational Material or the Free Writing Prospectus]
[incorporated by reference from the website located at [______________]].]
(b) Promptly after receipt by any indemnified party under this Section
1 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 this Section 1, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 1 except to the extent it has
been materially prejudiced by such failure; and provided, further, however, that
the failure to notify any indemnifying party shall not relieve it from any
liability which it may have to any indemnified party otherwise than under this
Section 1.
If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, except as provided in
the following paragraph, the indemnifying party shall not be liable to the
indemnified party under this Section 1 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation.
Any indemnified party shall have the right to employ separate counsel
in any such action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
necessary or appropriate for such indemnified party to employ separate counsel;
or (iii) the indemnifying party has failed to assume the defense of such action
and employ counsel reasonably satisfactory to the indemnified party, in which
case, if such indemnified party notifies the indemnifying party in writing that
it elects to employ separate counsel at the expense of the indemnifying party,
the indemnifying party shall not have the right to assume the defense of such
action on behalf of such indemnified party, it being understood, however, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one
K-3
separate firm of attorneys (in addition to local counsel) at any time for all
such indemnified parties.
Each indemnified party, as a condition of the indemnity agreements
contained in this Section 1, shall cooperate with the indemnifying party in the
defense of any such action or claim. No indemnifying party shall be liable for
any settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment for the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any indemnified
party from and against any loss or liability by reason of such settlement or
judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified
party shall have requested an indemnifying party to reimburse the indemnified
party for reasonable fees and expenses of counsel, the indemnifying party agrees
that it shall be liable for any settlement of any proceeding effected without
its written consent if (i) such settlement is entered into more than 30 days
after receipt by such indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement.
(c) If the indemnification provided for in this Section 1 is
unavailable to an indemnified party, then the indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages or
liabilities, in such proportion as is appropriate to reflect the relative fault
of the indemnifying party and the indemnified party, respectively, in connection
with the statements or omissions that result in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault of the indemnified party and indemnifying party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by such parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission and any other equitable considerations.
(d) The indemnity and contribution agreements contained in this
Section 1 and the representations and warranties set forth in Section 2 shall
remain operative and in full force and effect regardless of (i) any termination
of this Agreement, (ii) any investigation made by IXIS, the Depositor, the
Underwriter[s] their respective affiliates, directors, officers, employees or
agents or any person controlling IXIS, the Depositor, the Underwriter[s] or any
such affiliate and (iii) acceptance of and payment for any of the Offered
Certificates.
2. Representations and Warranties. Seller [and Initial Servicer]
represents and warrants that:
(i) Seller [and Initial Servicer] is validly existing and in good
standing under the laws of its jurisdiction of formation or incorporation,
as applicable, and has full power and authority to own its assets and to
transact the business in which it is currently engaged. Seller [and Initial
Servicer] is duly qualified to do business and is in good standing in each
jurisdiction in which the character of the business transacted by it or any
K-4
properties owned or leased by it requires such qualification and in which
the failure so to qualify would have a material adverse effect on the
business, properties, assets or condition (financial or otherwise) of
Seller [and Initial Servicer];
(ii) Seller [and Initial Servicer] is not required to obtain the
consent of any other person or any consent, license, approval or
authorization from, or registration or declaration with, any governmental
authority, bureau or agency in connection with the execution, delivery,
performance, validity or enforceability of this Agreement;
(iii) the execution, delivery and performance of this Agreement by
Seller [and Initial Servicer] will not violate any provision of any
existing law or regulation or any order decree of any court applicable to
Seller [and Initial Servicer] or any provision of the charter or bylaws of
Seller [and Initial Servicer], or constitute a material breach of any
mortgage, indenture, contract or other agreement to which Seller [and
Initial Servicer] is a party or by which it may be bound;
(iv) (a) no proceeding of or before any court, tribunal or
governmental body is currently pending or, (b) to the knowledge of Seller
[and Initial Servicer], threatened against Seller [and Initial Servicer] or
any of its properties or with respect to this Agreement or the Offered
Certificates, in either case, which would have a material adverse effect on
the business, properties, assets or condition (financial or otherwise) of
Seller [and Initial Servicer];
(v) Seller [and Initial Servicer] has full power and authority to
make, execute, deliver and perform this Agreement and all of the
transactions contemplated hereunder, and has taken all necessary corporate
action to authorize the execution, delivery and performance of this
Agreement. When executed and delivered, this Agreement will constitute the
legal, valid and binding obligation of each of Seller [and Initial
Servicer] enforceable in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors'
rights generally, by the availability of equitable remedies, and by
limitations of public policy under applicable securities law as to rights
of indemnity and contribution thereunder;
(vi) this Agreement has been duly executed and delivered by Seller
[and Initial Servicer];
(vii) the Due Diligence Answers given by the Indemnifying Party are
true, correct and complete in all material respects. "Due Diligence
Answers" means the answers given by the Seller to due diligence questions
asked by [______], which questions were prepared by [______]'s counsel
based upon the requirements of Regulation AB. Due Diligence Answers and the
related due diligence questions are evidenced by a writing that is attached
hereto as Exhibit A; and
(viii) the [Seller Information][Servicer Information] satisfies the
requirements of the applicable provisions of Regulation AB.
K-5
3. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to Seller [and Initial Servicer], will
be mailed, delivered or telegraphed and confirmed to First NLC Financial
Services, LLC, 000 Xxxx Xxxxxxxxx Xxxxxxxxx, Xxxxxxxx 0, Xxxxxxxxx Xxxxx,
Xxxxxxx 00000, Attention: Xxxxxxx X. Xxxxxxxx, President; or, if sent to IXIS,
will be mailed, delivered or telegraphed and confirmed to IXIS Real Estate
Capital Inc., 0 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: General
Counsel.
4. Miscellaneous. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York without giving effect to
the conflict of laws provisions thereof. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their successors and
assigns and the controlling persons referred to herein, and no other person
shall have any right or obligation hereunder. Neither this Agreement nor any
term hereof may be changed, waived, discharged or terminated orally, but only by
an instrument in writing signed by the party against whom enforcement of the
change, waiver, discharge or termination is sought. This Agreement may be
executed in counterparts, each of which when so executed and delivered shall be
considered an original, and all such counterparts shall constitute one and the
same instrument. Capitalized terms used but not defined herein shall have the
meanings provided in the P&S.
[Remainder of Page Intentionally Left Blank]
K-6
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective officers hereunto duly authorized, this
__th day of [_____________].
IXIS REAL ESTATE CAPITAL INC.
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
[SELLER]
By:
------------------------------------
Name:
Title:
[INITIAL SERVICER]
By:
------------------------------------
Name:
Title:
K-7
EXHIBIT DD
FLEXPOINT AGREEMENTS
DD-1
EXECUTION COPY
ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated January 30, 2007
("Agreement"), among IXIS Real Estate Capital Inc. ("Assignor"), Xxxxxx Xxxxxxx
ABS Capital I Inc. ("Assignee") and FlexPoint Funding Corporation (the
"Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns
to the Assignee all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain Second Amended
and Restated Mortgage Loan Purchase and Warranties Agreement (the "Purchase
Agreement"), dated as of February 1, 2006, between the Assignor, as purchaser
(the "Purchaser"), and the Company, as seller, as amended by Amendment No. 1,
dated as of May 1, 2006, solely insofar as the Purchase Agreement relates to the
Mortgage Loans.
The Assignor specifically reserves and does not assign to the Assignee
hereunder (i) any and all right, title and interest in, to and under and any
obligations of the Assignor with respect to any mortgage loans subject to the
Purchase Agreement which are not the Mortgage Loans set forth on the Mortgage
Loan Schedule and are not the subject of this Agreement or (ii) the rights of
the Purchaser (a) under Section 13, Subsection 9.04 and Subsection 14.01 of the
Purchase Agreement or (b) to any premium recapture (i.e., the excess, if any, of
the purchase price percentage over par) in connection with any repurchase
pursuant to Subsections 9.03 and 9.05 of the Purchase Agreement.
Recognition of the Company
2. From and after the date hereof (the "Securitization Closing Date"),
the Company shall and does hereby recognize that the Assignee will transfer the
Mortgage Loans and assign its rights under the Purchase Agreement (solely to the
extent set forth herein) and this Agreement to IXIS Real Estate Capital Trust
2007-HE1 (the "Trust") created pursuant to a Pooling and Servicing Agreement,
dated as of January 1, 2007 (the "Pooling Agreement"), among the Assignee, the
Assignor, Deutsche Bank National Trust Company, as trustee (in such capacity,
including its successors in interest and any successor trustees under the
Pooling Agreement, the "Trustee"), Xxxxx Fargo Bank, National Association, as
securities administrator (in such capacity, including its successors in interest
and any successor securities administrators under the Pooling Agreement, the
"Securities Administrator"), master servicer (in such capacity, including its
successors in interest and any successor master servicers under the Pooling
Agreement, the "Master Servicer") and Saxon Mortgage Services, Inc., as servicer
(including its successors in interest and any successor servicer under the
Pooling Agreement, the "Servicer"). The Company hereby acknowledges and agrees
that from and after the date hereof (i) the Trust will be the owner of the
Mortgage Loans, (ii) the Company shall look solely to the Trust for
1
performance of any obligations of the Assignor insofar as they relate to the
Mortgage Loans, (iii) the Trust (including the Trustee, Securities
Administrator, Master Servicer and the Servicer acting on the Trust's behalf)
shall have all the rights and remedies available to the Assignor, insofar as
they relate to the Mortgage Loans, under the Purchase Agreement, including,
without limitation, the enforcement of the document delivery requirements set
forth in Section 6 of the Purchase Agreement, and shall be entitled to enforce
all of the obligations of the Company thereunder insofar as they relate to the
Mortgage Loans, and (iv) all references to the Purchaser, the Custodian or the
Bailee under the Purchase Agreement insofar as they relate to the Mortgage
Loans, shall be deemed to refer to the Trust (including the Trustee, Securities
Administrator, Master Servicer and the Servicer acting on the Trust's behalf).
Neither the Company nor the Assignor shall amend or agree to amend, modify,
waiver, or otherwise alter any of the terms or provisions of the Purchase
Agreement which amendment, modification, waiver or other alteration would in any
way affect the Mortgage Loans or the Company's performance under the Purchase
Agreement with respect to the Mortgage Loans without the prior written consent
of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee
and the Trust (including the Trustee, Securities Administrator, Master Servicer
and the Servicer acting on the Trust's behalf) as of the date hereof that:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver
and perform its obligations under this Agreement and has full power and
authority to perform its obligations under the Purchase Agreement. The
execution by the Company of this Agreement is in the ordinary course of the
Company's business and will not conflict with, or result in a breach of,
any of the terms, conditions or provisions of the Company's charter or
bylaws or any legal restriction, or any material agreement or instrument to
which the Company is now a party or by which it is bound, or result in the
violation of any law, rule, regulation, order, judgment or decree to which
the Company or its property is subject. The execution, delivery and
performance by the Company of this Agreement have been duly authorized by
all necessary corporate action on part of the Company. This Agreement has
been duly executed and delivered by the Company, and, upon the due
authorization, execution and delivery by the Assignor and the Assignee,
will constitute the valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization, insolvency,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and by general principles of equity regardless
of whether enforceability is considered in a proceeding in equity or at
law;
(c) No consent, approval, order or authorization of, or
declaration, filing or registration with, any governmental entity is
required to be obtained or made by the Company in connection with the
execution, delivery or performance by the Company of this Agreement; and
2
(d) There is no action, suit, proceeding or investigation pending
or threatened against the Company, before any court, administrative agency
or other tribunal, which would draw into question the validity of this
Agreement or the Purchase Agreement, or which, either in any one instance
or in the aggregate, would result in any material adverse change in the
ability of the Company to perform its obligations under this Agreement or
the Purchase Agreement, and the Company is solvent.
4. Pursuant to Section 13 of the Purchase Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust (including the Trustee, Securities Administrator, Master Servicer
and the Servicer acting on the Trust's behalf), that the representations and
warranties set forth in Section 9.02 of the Purchase Agreement are true and
correct as of the date hereof as if such representations and warranties were
made on the date hereof unless otherwise specifically stated in such
representations and warranties.
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf) in connection with any breach of the representations and warranties made
by the Company set forth in Sections 3 and 4 hereof shall be as set forth in
Subsection 9.03 of the Purchase Agreement as if they were set forth herein
(including without limitation the repurchase and indemnity obligations set forth
therein); provided, however, that the Assignor specifically reserves and does
not assign to the Assignee hereunder any and all right, title and interest in
the Premium Percentage, if any, due in connection with the repurchase of a
Mortgage Loan pursuant to Subsections 9.03, 9.04 and 9.05.
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced, with the prior
written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors and
assigns of the parties hereto and (ii) the Trust (including the Trustee,
Securities Administrator, Master Servicer and the Servicer acting on the Trust's
behalf). Any entity into which Assignor, Assignee or Company may be merged or
consolidated shall, without the requirement for any further writing, be deemed
Assignor, Assignee or Company, respectively, hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive the
conveyance of the Mortgage Loans and the assignment of the Purchase Agreement
(to the extent assigned hereunder) by Assignor to Assignee and by Assignee to
the Trust and nothing contained herein shall supersede or amend the terms of the
Purchase Agreement.
3
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
4
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
FLEXPOINT FUNDING CORPORATION
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Its: EVP of Capital Markets
IXIS REAL ESTATE CAPITAL INC.
By: /s/ F. Xxxx Xxxxxx
------------------------------------
Name: F. Xxxx Xxxxxx
Its: Managing Director
By: /s/ Xxxxxxxxxxx Xxxxxx
------------------------------------
Name: Xxxxxxxxxxx Xxxxxx
Its: Managing Director
XXXXXX XXXXXXX ABS CAPITAL I INC.
By: /s/ Xxxxxxx Xxx
------------------------------------
Name: Xxxxxxx Xxx
Its: Vice President
5
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
MORTGAGE LOAN SCHEDULE
EXECUTION COPY
================================================================================
SECOND AMENDED AND RESTATED MORTGAGE LOAN
PURCHASE AND WARRANTIES AGREEMENT
IXIS REAL ESTATE CAPITAL INC.,
Purchaser
FLEXPOINT FUNDING CORPORATION,
Seller
Dated as of February 1, 2006
Adjustable-Rate and Fixed-Rate, B/C Residential Mortgage Loans
================================================================================
TABLE OF CONTENTS
Page
----
SECTION 1. Definitions.................................................... 1
SECTION 2. Agreement to Purchase.......................................... 13
SECTION 3. Mortgage Schedules............................................. 13
SECTION 4. Purchase Price................................................. 14
SECTION 5. Examination of Mortgage Files.................................. 14
SECTION 6. Conveyance from Seller to Purchaser............................ 15
Subsection 6.01 Conveyance of Mortgage Loans; Possession of
Servicing Files................................... 15
Subsection 6.02 Books and Records................................. 15
Subsection 6.03 Delivery of Mortgage Loan Documents............... 16
Subsection 6.04 Quality Control Procedures........................ 17
Subsection 6.05 MERS Designated Mortgage Loans.................... 17
SECTION 7. Servicing of the Mortgage Loans................................ 17
SECTION 8. Transfer of Servicing.......................................... 18
SECTION 9. Representations, Warranties and Covenants of the Seller;
Remedies for Breach............................................ 20
Subsection 9.01 Representations and Warranties Regarding
the Seller........................................ 20
Subsection 9.02 Representations and Warranties Regarding
Individual Mortgage Loans......................... 24
Subsection 9.03 Remedies for Breach of Representations and
Warranties........................................ 39
Subsection 9.04 Repurchase of Mortgage Loans That Prepay
in Full........................................... 41
Subsection 9.05 Repurchase of Mortgage Loans with First
Payment Defaults.................................. 42
Subsection 9.06 Purchaser's Right to Review....................... 42
SECTION 10. Closing........................................................ 43
SECTION 11. Closing Documents.............................................. 43
SECTION 12. Costs.......................................................... 45
SECTION 13. Cooperation of Seller with a Reconstitution.................... 45
SECTION 14. The Seller..................................................... 47
Subsection 14.01 Additional Indemnification by the Seller;
Third Party Claims............................... 47
Subsection 14.02 Merger or Consolidation of the Seller............ 48
SECTION 15. Financial Statements........................................... 48
SECTION 16. Mandatory Delivery; Grant of Security Interest................. 48
SECTION 17. Notices........................................................ 49
SECTION 18. Severability Clause............................................ 50
SECTION 19. Counterparts................................................... 50
SECTION 20. Governing Law Jurisdiction; Consent to Service of Process...... 50
SECTION 21. Intention of the Parties....................................... 50
SECTION 22. Successors and Assigns; Assignment of Purchase Agreement....... 51
SECTION 23. Waivers........................................................ 51
SECTION 24. Exhibits....................................................... 51
SECTION 25. General Interpretive Principles................................ 51
SECTION 26. Reproduction of Documents...................................... 52
SECTION 27. Further Agreements............................................. 52
SECTION 28. Recordation of Assignments of Mortgage......................... 52
SECTION 29. No Solicitation................................................ 52
SECTION 30. Waiver of Trial by Jury........................................ 53
SECTION 31. Compliance with Regulation AB.................................. 53
Subsection 31.01 Intent of the Parties; Reasonableness............ 53
Subsection 31.02 Additional Representations and Warranties
of the Seller.................................... 53
Subsection 31.03 Information to Be Provided by the Seller......... 54
Subsection 31.04 Indemnification; Remedies........................ 57
EXHIBITS
EXHIBIT A CONTENTS OF EACH MORTGAGE FILE
EXHIBIT B FORM OF INTERIM SERVICING AGREEMENT
EXHIBIT C FORM OF SELLER'S OFFICER'S CERTIFICATE
EXHIBIT D FORM OF OPINION OF COUNSEL TO THE SELLER AND THE
INTERIM SERVICER
EXHIBIT E FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT F FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT G [RESERVED]
EXHIBIT H FORM OF ASSIGNMENT AND CONVEYANCE AGREEMENT
EXHIBIT I SELLER'S UNDERWRITING GUIDELINES
EXHIBIT J FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
EXHIBIT K FORM OF INDEMNIFICATION AND CONTRIBUTION AGREEMENT
SECOND AMENDED AND RESTATED MORTGAGE LOAN
PURCHASE AND WARRANTIES AGREEMENT
This SECOND AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND WARRANTIES
AGREEMENT (the "Agreement"), dated as of February 1, 2006, by and between IXIS
Real Estate Capital Inc., a New York corporation, having an office at 0 Xxxx
00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Purchaser"), and
FlexPoint Funding Corporation, a California corporation, having an office at 00
Xxxxxxxxx Xxxx, Xxxxx 000, Xxxxxx, Xxxxxxxxxx 00000 (the "Seller").
WITNESSETH:
WHEREAS, the Purchaser and the Seller are parties to that certain
Amended and Restated Mortgage Loan Purchase and Warranties Agreement, dated as
of October 1, 2005 (the "Original Agreement"), between the Purchaser and the
Seller.
WHEREAS, at the present time, the Purchaser and the Seller desire to
amend the Original Agreement to make certain modifications as set forth herein
with respect to all Mortgage Loans acquired pursuant to this Agreement or the
Original Agreement.
NOW, THEREFORE, in consideration of the premises and mutual agreements
set forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Purchaser and the Seller agree
as follows:
SECTION 1. Definitions. For purposes of this Agreement the following
capitalized terms shall have the respective meanings set forth below.
Accepted Servicing Practices: With respect to any Mortgage Loan, those
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 and incorporating
the Delinquency Collection Policies and Procedures.
Act: The National Housing Act, as amended from time to time.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan
purchased pursuant to this Agreement.
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agency Transfer: A Xxxxxx Xxx Transfer or a Xxxxxxx Mac Transfer.
Agreement: This Second and Amended Mortgage Loan Purchase and
Warranties Agreement and all amendments hereof and supplements hereto.
ALTA: The American Land Title Association and its successors in
interest.
Appraised Value: (i) With respect to any First Lien Loan, the value of
the related Mortgaged Property based upon the appraisal made, if any, for the
originator at the time of origination of the Mortgage Loan or the sales price of
the Mortgaged Property at such time of origination, whichever is less; provided,
however, that in the case of a refinanced Mortgage Loan, such value is based
solely upon the appraisal made, if any, at the time of origination of such
refinanced Mortgage Loan, and (ii) with respect to any Second Lien Loan, the
value, determined pursuant to the Seller's Underwriting Guidelines, of the
related Mortgaged Property as of the origination of the Second Lien Loan.
Assignment and Conveyance Agreement: As defined in Subsection 6.01.
Assignment of Mortgage: 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.
Balloon Mortgage Loan: Any Mortgage Loan that requires only payments
of interest until the stated maturity date of the Mortgage Loan or the Monthly
Payments of principal which (not including the payment due on its stated
maturity date) are based on an amortization schedule that would be insufficient
to fully amortize the principal thereof by stated maturity date of the Mortgage
Loan.
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 State of New York
or the state in which the Interim Servicer's servicing operations are located,
are authorized or obligated by law or executive order to be closed.
Closing Date: The date or dates on which the Purchaser from time to
time shall purchase and the Seller from time to time shall sell the Mortgage
Loans listed on the related Mortgage Loan Schedule with respect to the related
Mortgage Loan Package.
CLTV: As of any date and as to (1) any Second Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the Second Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are senior or equal in
priority to the Second Lien Loan and which are secured by the same Mortgaged
Property to (b) the Appraised Value and (2) any First Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the First Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are junior or equal in
priority to the First Lien Loan and which are secured by the same Mortgaged
Property to (b) the Appraised Value.
Code: Internal Revenue Code of 1986, as amended.
Commission: The United States Securities and Exchange Commission.
2
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.
Convertible Mortgage Loan: Any individual Adjustable Rate Mortgage
Loan purchased pursuant to this Agreement which contains a provision whereby the
Mortgagor is permitted to convert the Adjustable Rate Mortgage Loan to a Fixed
Rate Mortgage Loan in accordance with the terms of the related Mortgage Note.
Covered Loan: A Mortgage Loan categorized as Covered pursuant to
Appendix E of Standard & Poor's Glossary.
Credit Files: As defined in Section 5 herein.
Custodial Account: The separate account or accounts created and
maintained pursuant to Section 2.04 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Custodial Agreement: The agreement governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other
Mortgage Loan Documents, to be executed between the Purchaser and the Custodian
and to be dated as of the related Cut-Off Date.
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 therein provided. If at any time there is no Custodial
Agreement in effect with respect to a Mortgage Loan, all references to the
Custodian herein and in the Interim Servicing Agreement shall be deemed to refer
to the Purchaser (or its designee) with respect to such Mortgage Loan.
Cut-off Date: The date or dates designated as such on the related
Mortgage Loan Schedule with respect to the related Mortgage Loan Package.
Deemed Material Breach Representation: Each representation identified
as such in Subsection 9.02.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased or replaced
or to be replaced with a Qualified Substitute Mortgage Loan by the Seller in
accordance with the terms of this Agreement.
Delinquency Collection Policies and Procedures: The delinquency
collection policies and procedures of the Seller, a copy of which is attached to
the Interim Servicing Agreement.
Depositor: The depositor, as such term is defined in Regulation AB,
with respect to any Securitization Transaction.
3
Determination Date: The date specified in the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
Due Date: The day of the month on which the Monthly Payment is due on
a Mortgage Loan, exclusive of any days of grace.
Eligible Account: Any of (i) an account maintained with a federal or
state chartered depository institution or trust company the short-term unsecured
debt obligations of which (or, in the case of a depository institution or trust
company 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 or
Prime-1 by Moody's (or a comparable rating if another Rating Agency is specified
by the Purchaser by written notice to the Seller) at the time any amounts are
held on deposit therein, (ii) an account or accounts the deposits in which are
fully insured by the FDIC, or (iii) a trust account or accounts maintained with
a federal or state chartered depository institution or trust company acting in
its fiduciary capacity.
Escrow Account: The separate account or accounts created and
maintained pursuant to Section 2.06 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
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 document.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Xxxxxx Mae: The Federal National Mortgage Association and its
successors in interest.
Xxxxxx Xxx Guides: The Xxxxxx Xxx Xxxxxxx' Guide and the Xxxxxx Xxx
Servicers' Guide and all amendments or additions thereto.
Xxxxxx Mae Transfer: As defined in Section 13 hereof.
FDIC: The Federal Deposit Insurance Corporation and its successors in
interest.
FHA: The Federal Housing Administration, an agency within the United
States Department of Housing and Urban Development and its successors in
interest and including the Federal Housing Commissioner and the Secretary of
Housing and Urban Development where appropriate under the FHA Regulations.
First Lien Loan: Any Mortgage Loan secured by a first lien Mortgage on
the related Mortgaged Property.
Fitch: Fitch, Inc. and its successors in interest.
4
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 in interest.
Xxxxxxx Mac Transfer: As defined in Section 13 hereof.
GEMICO: General Electric Mortgage Insurance Corporation, a North
Carolina corporation and its successors in interest.
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 (a) covered by the Home Ownership and
Equity Protection Act of 1994, (b) classified as a "high cost home,"
"threshold," "covered," "high risk home," "predatory" or similar loan under any
other applicable state, federal or local law (or a similarly classified loan
using different terminology under a law imposing heightened regulatory scrutiny
or additional legal liability for residential mortgage loans having high
interest rates, points and/or fees) or (c) categorized as High Cost pursuant to
Appendix E of Standard & Poor's Glossary. For avoidance of doubt, the parties
agree that this definition shall apply to any law regardless of whether such law
is presently, or in the future becomes, the subject of judicial review or
litigation.
Home Loan: A Mortgage Loan categorized as Home Loan pursuant to
Appendix E of Standard & Poor's Glossary.
HUD: The Department of Housing and Urban Development, or any federal
agency or official thereof which may from time to time succeed to the functions
thereof with regard to FHA Mortgage Insurance. The term "HUD," for purposes of
this Agreement, is also deemed to include subdivisions thereof such --- as the
FHA and Government National Mortgage Association.
Index: With respect to each Adjustable Rate Mortgage Loan, a rate per
annum set forth on Exhibit B to each related Assignment and Conveyance
Agreement.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
Interest Rate Adjustment Date: With respect to each Adjustable Rate
Mortgage Loan, the date, specified in the related Mortgage Note and the Mortgage
Loan Schedule, on which the Mortgage Interest Rate is adjusted.
Interim Funder: With respect to each MERS Designated Mortgage Loan,
the Person named on the MERS(R) System as the interim funder pursuant to the
MERS Procedures Manual.
5
Interim Servicer: FlexPoint Funding Corporation, a California
corporation, and its successors in interest, and any successor interim servicer
under the Interim Servicing Agreement.
Interim Servicing Agreement: The agreement, attached as Exhibit B
hereto, to be entered into by the Purchaser and the Interim Servicer, providing
for the Interim Servicer to service the Mortgage Loans for an interim period as
specified by the Interim Servicing Agreement.
Investor: With respect to each MERS Designated Mortgage Loan, the
Person named on the MERS(R) System as the investor pursuant to the MERS
Procedures Manual.
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 related Mortgage Loan Schedule.
Liquidation Proceeds: Cash 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 or otherwise, or the sale of the
related Mortgaged Property if the Mortgaged Property is acquired in satisfaction
of the Mortgage Loan.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan, the
ratio (expressed as a percentage) of the outstanding principal amount of the
Mortgage Loan as of the Cut-off Date (unless otherwise indicated), to the
Appraised Value of the Mortgaged Property.
MERS: Mortgage Electronic Registration Systems, Inc., a Delaware
corporation, and its successors and assigns.
MERS Designated Mortgage Loan: Mortgage Loans for which (a) the Seller
has designated or will designate MERS as, and has taken or will take such action
as is necessary to cause MERS to be, the mortgagee of record, as nominee for the
Seller, in accordance with MERS Procedure Manual and (b) the Seller has
designated or will designate the Purchaser as the Investor on the MERS(R)
System.
MERS Procedure Manual: The MERS Procedures Manual, as it may be
amended, supplemented or otherwise modified from time to time.
MERS Report: The report from the MERS System listing MERS Designated
Mortgage Loans and other information.
MERS(R) System: MERS mortgage electronic registry system, as more
particularly described in the MERS Procedures Manual.
Monthly Payment: The scheduled monthly payment of principal and
interest on a Mortgage Loan.
6
Moody's: Xxxxx'x Investors Service, Inc. and its successors in
interest.
Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note, which creates a first lien, in the case of a First Lien Loan, or
a second lien, in the case of a Second Lien Loan, on the Mortgaged Property.
Mortgage File: The items pertaining to a particular Mortgage Loan
referred to in Exhibit A 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 with respect to each Mortgage Loan.
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 applicable Mortgage Loan Schedule, which Mortgage Loan
includes without limitation the Mortgage File, the Monthly Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
Servicing Rights, and all other rights, benefits, proceeds and obligations
arising from or in connection with such Mortgage Loan, excluding replaced or
repurchased mortgage loans.
Mortgage Loan Documents: The documents required to be delivered to the
Custodian pursuant to Section 6.03 hereof with respect to any Mortgage Loan.
Mortgage Loan Package: Each pool of Mortgage Loans, which shall be
purchased by the Purchaser from the Seller from time to time on each Closing
Date.
Mortgage Loan Schedule: The schedule of Mortgage Loans setting forth
the following information with respect to each Mortgage Loan in the related
Mortgage Loan Package: (1) the Seller's Mortgage Loan identifying number; (2)
the Mortgagor's name; (3) the street address of the Mortgaged Property including
the city, state and zip code; (4) a code indicating whether the Mortgaged
Property is owner-occupied, a second home or investment property; (5) the number
and type of residential units constituting the Mortgaged Property (i.e., a
single family residence, a 2-4 family residence, a unit in a condominium project
or a unit in a planned unit development, manufactured housing); (6) the Mortgage
Loan origination date; (7) the original months to maturity or the remaining
months to maturity from the related Cut-off Date, in any case based on the
original amortization schedule and, if different, the maturity expressed in the
same manner but based on the actual amortization schedule; (8) the Loan-to-Value
Ratio at origination; (9) with respect to First Lien Loans, the LTV and with
respect to Second Lien Loans, the CLTV; (10) the Mortgage Interest Rate as of
the related Cut-off Date; (11) the date on which the Monthly Payment was due on
the Mortgage Loan and, if such date is not consistent with the Due Date
currently in effect, such Due Date; (12) the stated maturity date; (13) the
amount of the Monthly Payment as of the related Cut-off Date; (14) the last
payment date as of which a payment was actually applied to the outstanding
principal balance; (15) the original principal amount of the Mortgage Loan; (16)
the principal balance of the Mortgage Loan as of the close of business on the
related Cut-off Date, after deduction of payments of principal due and collected
on or before the Cut-off Date; (17) the Interest Rate Adjustment Date; (18) the
7
Gross Margin; (19) the Lifetime Rate Cap under the terms of the Mortgage Note;
(20) a code indicating the type of Index; (21) the Mortgage Interest Rate as of
origination; (22) the type of Mortgage Loan (i.e., fixed-rate, adjustable-rate,
First Lien, Second Lien); (23) a code indicating the purpose of the loan (i.e.,
purchase, rate and term refinance, equity take-out refinance); (24) a code
indicating the documentation style (i.e., full or stated income); (25) the loan
credit classification (as described in the Underwriting Guidelines); (26) the
applicable Cut-off Date; (27) the applicable Closing Date; (28) a code
indicating whether the Mortgage Loan is a Home Loan; (29) the credit risk score
(FICO score); (30) with respect to the related Mortgagor, the debt-to-income
ratio; (31) with respect to Second Lien Loans, the outstanding principal balance
of the superior lien; (32) the Appraised Value of the Mortgaged Property; (33)
the sale price of the Mortgaged Property if the Mortgage Loan was originated in
connection with the purchase of the Mortgaged Property; (34) the Periodic Rate
Cap under the terms of the Mortgage Note; (35) the Periodic Rate Floor under the
terms of the Mortgage Note; (36) whether such Mortgage Loan provides for a
prepayment penalty; (37) the prepayment penalty period of such Mortgage Loan, if
applicable; (38) a description of the type of prepayment penalty, if applicable;
(39) the MERS Identification Number; (40) whether the Mortgagor represented that
the Mortgagor would occupy the Mortgaged Property as its primary residence and
(41) a code indicating if the Mortgage Loan is a Balloon Mortgage Loan. With
respect to the Mortgage Loans in the aggregate, the Mortgage Loan Schedule shall
set forth the following information, as of the related Cut-off Date: (1) the
number of Mortgage Loans; (2) the current aggregate outstanding principal
balance of the Mortgage Loans; (3) the weighted average Mortgage Interest Rate
of the Mortgage Loans; and (4) the weighted average maturity of the Mortgage
Loans.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
Mortgaged Property: With respect to each Mortgage Loan, the
Mortgagor's real property securing repayment of a related Mortgage Note,
consisting of an unsubordinated estate in fee simple or, with respect to real
property located in jurisdictions in which the use of leasehold estates for
residential properties is a widely-accepted practice, a leasehold estate, in a
single parcel or multiple parcels of real property improved by a residential
dwelling as further described in this Agreement.
Mortgagor: The obligor on a Mortgage Note.
OCC: Office of the Comptroller of the Currency and its successors in
interest.
Officer's Certificate: A certificate signed by the Chairman of the
Board or the Vice Chairman of the Board or a President or a Vice President and
by the Treasurer or the Secretary or one of the Assistant Treasurers or
Assistant Secretaries of the Seller, and delivered to the Purchaser as required
by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel
for the Seller, reasonably acceptable to the Purchaser, provided that any
Opinion of Counsel relating to (a) the qualification of any account required to
be maintained pursuant to this Agreement as an Eligible Account, (b)
qualification of the Mortgage Loans in a REMIC or (c) compliance with the REMIC
Provisions, must be (unless otherwise stated in such Opinion of Counsel) an
opinion
8
of counsel who (i) is in fact independent of the Seller and any servicer of the
Mortgage Loans, (ii) does not have any material direct or indirect financial
interest in the Seller or any servicer of the Mortgage Loans or in an Affiliate
of either and (iii) is not connected with the Seller or any servicer of the
Mortgage Loans as an officer, employee, director or person performing similar
functions.
OTS: Office of Thrift Supervision and its successors in interest. ---
Periodic Rate Cap: 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 increase on an Interest
Rate Adjustment Date above the Mortgage Interest Rate previously in effect.
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.
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.
Preliminary Mortgage Schedule: As defined in Section 3.
Premium Percentage: With respect to any Mortgage Loan, a percentage
equal to the excess of the Purchase Price Percentage over 100%.
Principal Prepayment: Any payment or other recovery of principal on a
Mortgage Loan 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.
Purchase Price: The price paid on the related Closing Date by the
Purchaser to the Seller in exchange for the Mortgage Loans purchased on such
Closing Date as calculated in Section 4 of this Agreement.
Purchase Price and Terms Agreement: Those certain agreements setting
forth the general terms and conditions of the transaction consummated herein and
identifying the Mortgage Loans to be purchased from time to time hereunder, by
and among the Seller, the Purchaser and the Interim Servicer (if applicable).
All of the individual Purchase Price and Terms Agreements shall collectively be
referred to as the "Purchase Price and Terms Agreement."
Purchase Price Percentage: With respect to any Mortgage Loan, an
amount equal to the percentage of par as stated in the Purchase Price and Terms
Agreement (subject to adjustment as provided therein) related to such Mortgage
Loan.
9
Purchaser: IXIS Real Estate Capital Inc., a New York corporation, and
its successors in interest and assigns, or any successor to the Purchaser under
this Agreement as herein provided.
Qualified Correspondent: Any Person from which the Seller purchased
Mortgage Loans, provided that the following conditions are satisfied: (i) such
Mortgage Loans were originated pursuant to an agreement between the Seller and
such Person that contemplated that such Person would underwrite mortgage loans
from time to time, for sale to the Seller, in accordance with underwriting
guidelines designated by the Seller ("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 Seller within one hundred eighty (180) days after origination; (iii) either
(x) the Designated Guidelines were, at the time such Mortgage Loans were
originated, used by the Seller in origination of mortgage loans of the same type
as the Mortgage Loans for the Seller's own account or (y) the Designated
Guidelines were, at the time such Mortgage Loans were underwritten, designated
by the Seller on a consistent basis for use by lenders in originating mortgage
loans to be purchased by the Seller; and (iv) the Seller employed, at the time
such Mortgage Loans were acquired by the Seller, pre-purchase or post-purchase
quality assurance procedures (which may involve, among other things, review of a
sample of 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
Seller.
Qualified Substitute Mortgage Loan: A mortgage loan eligible to be
substituted by the Seller for a Deleted Mortgage Loan which must, on the date of
such substitution, (i) have an outstanding principal balance, after deduction of
all scheduled payments due in the month of substitution (or in the case of a
substitution of more than one mortgage loan for a Deleted Mortgage Loan, an
aggregate principal balance), not in excess of the outstanding principal balance
of the Deleted Mortgage Loan (the amount of any shortfall will be deposited in
the Custodial Account by the Seller in the month of substitution); (ii) have a
Mortgage Interest Rate not less than and not more than 1% greater than the
Mortgage Interest Rate of the Deleted Mortgage Loan; (iii) have a remaining term
to maturity not greater than and not more than one year less than that of the
Deleted Mortgage Loan; (iv) be of the same type as the Deleted Mortgage Loan
(i.e., fixed-rate, adjustable-rate with same Periodic Rate Cap, Index and lien
priority); and (v) comply with each representation and warranty (respecting
individual Mortgage Loans) set forth in Section 9 hereof.
Rating Agency: Any of Fitch, Moody's or Standard & Poor's, or their
respective successors designated by the Purchaser.
Reconstitution: Any Securitization Transaction or Whole Loan Transfer.
Reconstitution Agreements: The agreement or agreements entered into by
the Seller and/or the Interim Servicer and the Purchaser and/or certain third
parties on the Reconstitution Date or Dates with respect to any or all of the
Mortgage Loans sold hereunder, in connection with a Whole Loan Transfer, Agency
Transfer or a Securitization Transaction pursuant to Section 13, including, but
not limited to, a seller's warranties and servicing agreement with respect to a
Whole Loan Transfer, and a trust and servicing agreement, pooling
10
and servicing agreement and/or seller/servicer agreements and related
custodial/trust agreement and documents with respect to a Securitization
Transaction.
Reconstitution Date: As defined in Section 13.
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. Sections 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 Date: The date specified in the Interim Servicing Agreement
(with respect to each Mortgage Loan, for an interim period, as specified
therein). Repurchase Price: With respect to any Mortgage Loan for which a breach
of a representation or warranty from the Agreement or the Interim Servicing
Agreement is found, a price equal to the then outstanding principal balance of
the Mortgage Loan to be repurchased, plus accrued interest thereon at the
Mortgage Interest Rate from the date to which interest had last been paid
through the date of such repurchase, plus the amount of any outstanding advances
owed to any servicer, and plus all costs and expenses incurred by the Purchaser
or any servicer arising out of or based upon such breach, including without
limitation costs and expenses incurred in the enforcement of the Seller's
repurchase obligation hereunder, and plus, in the event a Mortgage Loan is
repurchased during the first twelve months following the related Closing Date,
an amount equal to the Premium Percentage multiplied by the outstanding
principal balance of such Mortgage Loan as of the date of such repurchase.
RESPA: Real Estate Settlement Procedures Act, as amended from time to
time.
Second Lien Loan: A Mortgage Loan secured by a second lien Mortgage on
the related Mortgaged Property.
Securities Act: The federal Securities Act of 1933, as amended.
Securitization Transaction: Any transaction involving either (1) 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 (2) 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
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portfolios of residential mortgage loans consisting, in whole or in part, of
some or all of the Mortgage Loans.
Seller: FlexPoint Funding Corporation, a California corporation, and
its successors in interest.
Seller Information: As defined in Subsection 31.04(a).
Servicing Fee: With respect to each Mortgage Loan subject to the
Interim Servicing Agreement, an amount equal to 0.50% per annum computed on the
basis of the outstanding principal balance of the related Mortgage Loan. Such
fee shall be payable monthly and shall be pro rated for any portion of a month
during which the Mortgage Loan is serviced by the Interim Servicer under the
Interim Servicing Agreement. 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 this Agreement) of such Monthly Payment
collected by the Interim Servicer, or as otherwise provided under this
Agreement.
Servicing File: With respect to each Mortgage Loan, the file retained
by the Interim Servicer consisting of originals of all documents in the Mortgage
File which are not delivered to the Purchaser or the Custodian and copies of the
Mortgage Loan Documents.
Servicing Rights: Any and all of the following: (a) any and all rights
to service the Mortgage Loans; (b) any payments to or monies received by the
Interim Servicer for servicing the Mortgage Loans; (c) any late fees, penalties
or similar payments with respect to the Mortgage Loans; (d) all agreements or
documents creating, defining or evidencing any such servicing rights to the
extent they relate to such servicing rights and all rights of the Interim
Servicer thereunder; (e) Escrow Payments or other similar payments with respect
to the Mortgage Loans and any amounts actually collected by the Interim Servicer
with respect thereto; (f) all accounts and other rights to payment related to
any of the property described in this paragraph; and (g) any and all documents,
files, records, servicing files, servicing documents, servicing records, data
tapes, computer records, or other information pertaining to the Mortgage Loans
or pertaining to the past, present or prospective servicing of the Mortgage
Loans.
Sponsor: The sponsor, as such term is defined in Regulation AB, with
respect to any Securitization Transaction.
Standard & Poor's: Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies Inc., and its successors in interest.
Standard & Poor's Glossary: The Standard & Poor's LEVELS(R) Glossary,
as may be in effect from time to time.
Stated Principal Balance: As to each Mortgage Loan on any date of
determination, (i) the principal balance of such Mortgage Loan at the related
Cut-off Date after giving effect to payments of principal due on or before such
date, to the extent actually received,
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minus (ii) all amounts previously distributed to the Purchaser with respect to
the related Mortgage Loan representing payments or recoveries of principal on
such Mortgage Loan.
Static Pool Information: Static pool information as described in Item
1105(a)(1)-(3) and 1105(c) of Regulation AB.
Successor Servicer: Any servicer of one or more Mortgage Loans
designated by the Purchaser as being entitled to the benefits of the
indemnifications set forth in Sections 9.03 and 14.01.
Third-Party Originator: Each Person, other than a Qualified
Correspondent, that originated Mortgage Loans acquired by the Seller.
Transfer Date: The date on which the Purchaser, or its designee, shall
receive the transfer of servicing responsibilities and begin to perform the
servicing of the Mortgage Loans with respect to the related Mortgage Loan
Package, and the Interim Servicer shall cease all servicing responsibilities.
Such date shall occur on the day indicated by the Purchaser to the Interim
Servicer in accordance with the Interim Servicing Agreement.
Underwriting Guidelines: The underwriting guidelines of the Seller, a
copy of which is attached hereto as Exhibit I and a then-current copy of which
shall be attached as an Exhibit to the related Assignment and Conveyance.
VA: The Department of Veterans Affairs, an agency of the United States
of America, or any successor thereto including the Administrator of Veterans
Affairs.
Whole Loan Transfer: Any sale or transfer of some or all of the
Mortgage Loans, other than a Securitization Transaction.
SECTION 2. Agreement to Purchase. The Seller agrees to sell from time
to time, and the Purchaser agrees to purchase from time to time, Mortgage Loans
having an aggregate principal balance on the related Cut-off Date in an amount
as set forth in the related Purchase Price and Terms Agreement, or in such other
amount as agreed by the Purchaser and the Seller as evidenced by the actual
aggregate principal balance of the Mortgage Loans accepted by the Purchaser on
each Closing Date.
SECTION 3. Mortgage Schedules. The Seller from time to time shall
provide the Purchaser with certain information constituting a preliminary
listing of the Mortgage Loans to be purchased on each Closing Date in accordance
with the related Purchase Price and Terms Agreement and this Agreement (each, a
"Preliminary Mortgage Schedule").
The Seller shall deliver the Mortgage Loan Schedule for the Mortgage
Loans to be purchased on a particular Closing Date to the Purchaser at least two
(2) Business Days prior to the related Closing Date. The Mortgage Loan Schedule
shall be the related Preliminary Mortgage Schedule with those Mortgage Loans
which the Seller has not funded prior to the related Closing Date deleted.
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SECTION 4. Purchase Price. The Purchase Price for the Mortgage Loans
shall be equal to (a) the Purchase Price Percentage multiplied by the Cut-off
Date Balance, plus (b) accrued and unpaid interest on such principal balance at
the weighted average Mortgage Interest Rate (net of the Servicing Fee) of those
Mortgage Loans from the related Cut-off Date through the day prior to the
related Closing Date, inclusive. For purposes hereof, "Cut-off Date Balance"
means the aggregate principal balance, as of the related Cut-off Date, of the
Mortgage Loans listed on the related Mortgage Loan Schedule, after application
of scheduled payments of principal due on or before the related Cut-off Date, to
the extent such payments were actually received, together with any unscheduled
principal payments collected prior to the Cut-off Date; provided, however, that
payments of scheduled principal and interest paid prior to the Cut-off Date, but
to be applied on a due date beyond the related Cut-off Date, shall not be
applied to the principal balance as of the related Cut-off Date. If so provided
in the related Purchase Price and Terms Agreement, portions of the Mortgage
Loans shall be priced separately. The Purchase Price as so determined shall be
paid to the Seller on the related Closing Date by wire transfer of immediately
available funds to an account designated by the Seller in writing.
The Purchaser shall be entitled to (l) all principal paid after the
related Cut-off Date, (2) all other recoveries of principal collected on or
after the related Cut-off Date, and (3) all payments of interest on the Mortgage
Loans net of applicable Servicing Fees (minus that portion of any such payment
which is allocable to the period prior to the related Cut-off Date). The
outstanding principal balance of each Mortgage Loan as of the related Cut-off
Date is determined after application of payments of principal due on or before
the related Cut-off Date, to the extent actually collected, together with any
unscheduled principal prepayments collected prior to the Cut-off Date; provided,
however, that payments of scheduled principal and interest paid prior to the
Cut-off Date, but to be applied on a due date beyond the related Cut-off Date
shall not be applied to the principal balance as of the related Cut-off Date.
Such prepaid amounts shall be the property of the Purchaser. The Seller 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
Seller to the Purchaser.
SECTION 5. Examination of Mortgage Files. At least seven 14 days prior to
the related Closing Date, the Seller shall (i) either (a) deliver to the
Purchaser or its designee in escrow, for examination with respect to each
Mortgage Loan to be purchased, the related Mortgage File, including a copy of
the Assignment of Mortgage (except with respect to each MERS Designated Mortgage
Loan), pertaining to each Mortgage Loan, or (b) make the related Mortgage File
available to the Purchaser for examination at such other location as shall
otherwise be acceptable to the Purchaser and (ii) deliver to the Purchaser
copies of the credit and servicing files (collectively, the "Credit Files").
Such examination of the Mortgage Files may be made by the Purchaser or its
designee at any reasonable time before or after the related Closing Date. If the
Purchaser makes such examination prior to the related Closing Date and
determines, in its sole discretion, that any Mortgage Loans are unacceptable to
the Purchaser for any reason, such Mortgage Loans shall be deleted from the
related Mortgage Loan Schedule, and may be replaced by a Qualified Substitute
Mortgage Loan (or Loans) acceptable to the Purchaser. The Purchaser may, at its
option and without notice to the Seller, purchase some or all of the Mortgage
Loans without conducting any partial or complete examination. The fact that the
Purchaser or its designee has conducted or has failed to conduct any partial or
complete
14
examination of the Mortgage Files or the Credit Files shall not impair in any
way the Purchaser's (or any of its successor's) rights to demand repurchase,
substitution or other remedy as provided in this Agreement. In the event that
the Seller fails to deliver the Credit Files with respect to any Mortgage Loan,
the Seller shall, upon the request of the Purchaser, repurchase such Mortgage
Loan at the price and in the manner specified in Subsection 9.03.
SECTION 6. Conveyance from Seller to Purchaser. Subsection 6.01
Conveyance of Mortgage Loans; Possession of Servicing Files.
The Seller, simultaneously with the delivery of the Mortgage Loan
Schedule with respect to the related Mortgage Loan Package to be purchased on
each Closing Date, shall execute and deliver an Assignment and Conveyance
Agreement in the form attached hereto as Exhibit H (the "Assignment and
Conveyance Agreement"). The Seller shall cause the Servicing File retained by
the Interim Servicer pursuant to this Agreement to be appropriately identified
in the Seller's computer system and/or books and records, as appropriate, to
clearly reflect the sale of the related Mortgage Loan to the Purchaser. The
Seller shall cause the Interim Servicer to release from its custody the contents
of any Servicing File retained by it only in accordance with this Agreement or
the Interim Servicing Agreement, except when such release is required in
connection with a repurchase of any such Mortgage Loan pursuant to Subsection
9.03.
Subsection 6.02 Books and Records. Record title to each Mortgage as of
the related Closing Date shall be in the name of the Seller, the Purchaser or
one or more designees of the Purchaser, as the Purchaser shall select.
Notwithstanding the foregoing, each Mortgage and related Mortgage Note shall be
possessed solely by the Purchaser or the appropriate designee of the Purchaser,
as the case may be. All rights arising out of the Mortgage Loans including, but
not limited to, all funds received by the Seller or the Interim Servicer after
the related Cut-off Date on or in connection with a Mortgage Loan shall be
vested in the Purchaser or one or more designees of the Purchaser; provided,
however, that all funds received on or in connection with a Mortgage Loan shall
be received and held by the Seller or the Interim Servicer in trust for the
benefit of the Purchaser or the appropriate designee of the Purchaser, as the
case may be, as the owner of the Mortgage Loans pursuant to the terms of this
Agreement.
The sale of each Mortgage Loan shall be reflected on the Seller's
balance sheet and other financial statements as a sale of assets by the Seller.
The Seller shall or shall cause the Interim Servicer to 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 Seller shall or shall
cause the Interim Servicer to maintain in its possession, available for
inspection by the Purchaser, 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 Xxx or Xxxxxxx Mac, including but not
limited to documentation as to the method used in determining the applicability
of the provisions of the National Flood Insurance Act of 1968, as amended, to
the Mortgaged Property, documentation evidencing insurance coverage and periodic
inspection reports, as required by the Xxxxxx Mae Guides. To the extent
15
that original documents are not required for purposes of realization of
Liquidation Proceeds or Insurance Proceeds, documents maintained by the Seller
or the Interim Servicer may be in the form of microfilm or microfiche so long as
the Seller or the Interim Servicer complies with the requirements of the Xxxxxx
Xxx Guides.
Subsection 6.03 Delivery of Mortgage Loan Documents. The Seller shall
deliver and release to the Custodian no later than seven (7) Business Days prior
to the related Closing Date those Mortgage Loan Documents set forth on Exhibit A
hereto with respect to each Mortgage Loan set forth on the related Mortgage Loan
Schedule.
The Custodian shall certify its receipt of all such Mortgage Loan
Documents required to be delivered pursuant to the Custodial Agreement for the
related Closing Date, as evidenced by the Certification and Trust Receipt of the
Custodian in the form annexed to the Custodial Agreement. The Purchaser shall
pay all fees and expenses of the Custodian from and after the Closing Date.
The Seller shall or shall cause the Interim Servicer to forward to the
Custodian, or to such other Person as the Purchaser shall designate in writing,
original documents evidencing an assumption, modification, consolidation or
extension of any Mortgage Loan entered into in accordance with this Agreement
within two weeks of their execution, provided, however, that the Seller shall
provide the Custodian, or to such other Person as the Purchaser shall designate
in writing, with a certified true copy of any such document submitted for
recordation within two weeks of its execution, and shall promptly 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 ninety days of its submission for recordation.
In the event any document required to be delivered to the Custodian
pursuant to the previous paragraph, including an original or copy of any
document submitted for recordation to the appropriate public recording office,
is not so delivered to the Custodian, or to such other Person as the Purchaser
shall designate in writing, within 90 days following the Closing Date (other
than with respect to the Assignments of Mortgage which shall be delivered to the
Custodian in blank and recorded subsequently by the Purchaser or its designee),
and in the event that the Seller does not cure such failure within 30 days of
discovery or receipt of written notification of such failure from the Purchaser,
the related Mortgage Loan shall, upon the request of the Purchaser, be
repurchased by the Seller at the price and in the manner specified in Subsection
9.03. The foregoing repurchase obligation shall not apply in the event that the
Seller cannot deliver such original or copy of any document submitted for
recordation to the appropriate public recording office within the specified
period due to a delay caused by the recording office in the applicable
jurisdiction, provided that (i) the Seller shall deliver a recording receipt of
such recording office or, if such recording receipt is not available, an
officer's certificate of a servicing officer of the Seller, confirming that such
documents have been accepted for recording (upon request of the Purchaser and
delivery by the Purchaser to the Seller of a schedule of the related Mortgage
Loans, the Seller shall reissue and deliver to the Purchaser or its designee
said officer's certificate relating to the related Mortgage Loans), and (ii)
such document is delivered within twelve (12) months of the related Closing
Date.
16
The Seller shall pay all initial recording fees, if any, for the
assignments of mortgage and any other fees or costs in transferring all original
documents to the Custodian or, upon written request of the Purchaser, to the
Purchaser or the Purchaser's designee. The Purchaser or the Purchaser's designee
shall be responsible for recording the Assignments of Mortgage and shall be
reimbursed by the Seller for the costs associated therewith pursuant to the
preceding sentence.
Subsection 6.04 Quality Control Procedures. The Seller shall, or shall
cause the Interim Servicer to, have an internal quality control program that
verifies in a manner consistent with accepted industry procedures, on a regular
basis, the existence and accuracy of the legal documents, credit documents,
property appraisals, and underwriting decisions. The program shall include
evaluating and monitoring the overall quality of the Seller's loan production
and the servicing activities of the Interim Servicer. The program is to ensure
that the Mortgage Loans are originated and serviced in accordance with Accepted
Servicing Practices and the Underwriting Guidelines; guard against dishonest,
fraudulent, or negligent acts; and guard against errors and omissions by
officers, employees, or other authorized persons.
Subsection 6.05 MERS Designated Mortgage Loans. With respect to each
MERS Designated Mortgage Loan, the Seller shall, on or prior to the related
Closing Date, designate the Purchaser as the Investor and the Custodian as
custodian, and no Person shall be listed as Interim Funder on the MERS System.
In addition, on or prior to the related Closing Date, Seller shall provide the
Custodian and the Purchaser with a MERS Report listing the Purchaser as the
Investor, the Custodian as custodian and no Person as Interim Funder with
respect to each MERS Designated Mortgage Loan. SECTION 7. Servicing of the
Mortgage Loans. The Mortgage Loans have been sold by the Seller to the Purchaser
on a servicing released basis. Subject to, and upon the terms and conditions of
this Agreement and the Interim Servicing Agreement (with respect to each
Mortgage Loan, for an interim period, as specified therein), the Seller hereby
sells, transfers, assigns, conveys and delivers to the Purchaser the Servicing
Rights.
The Purchaser shall retain the Interim Servicer as contract servicer
of the Mortgage Loans for an interim period pursuant to and in accordance with
the terms and conditions contained in the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Except as set forth in the Interim Servicing Agreement, the Interim Servicer
shall service the Mortgage Loans on an "actual/actual" basis and otherwise in
strict compliance with the servicing provisions related to the Xxxxxx Mae MBS
Program (Special Servicing Option) of the Xxxxxx Xxx Guides (except as otherwise
set forth in the Interim Servicing Agreement). The Purchaser and Seller shall
cause the Interim Servicer to execute the Interim Servicing Agreement on the
initial Closing Date.
Pursuant to the Interim Servicing Agreement (with respect to each
Mortgage Loan, for an interim period, as specified therein), the Interim
Servicer shall begin servicing the Mortgage Loans on behalf of the Purchaser and
shall be entitled to a Servicing Fee with respect to such Mortgage Loans until
the applicable Transfer Date. The Interim Servicer shall conduct such servicing
in accordance with the Interim Servicing Agreement.
17
SECTION 8. Transfer of Servicing. On the applicable Transfer Date, the
Purchaser, or its designee, shall assume all servicing responsibilities related
to, and the Seller shall cause the Interim Servicer to cease all servicing
responsibilities related to, the related Mortgage Loans subject to such Transfer
Date. The Transfer Date shall be the date determined in accordance with Section
6.02 of the Interim Servicing Agreement (with respect to each Mortgage Loan, for
an interim period, as specified therein).
On or prior to the applicable Transfer Date, the Seller shall, at its
sole cost and expense, take such steps as may be necessary or appropriate to
effectuate and evidence the transfer of the servicing of the related Mortgage
Loans to the Purchaser, or its designee, including but not limited to the
following:
(a) Notice to Mortgagors. The Seller shall cause the Interim Servicer
to mail to the Mortgagor of each related Mortgage Loan a letter advising such
Mortgagor of the transfer of the servicing of the related Mortgage Loan to the
Purchaser, or its designee, in accordance with the Xxxxxxxx Xxxxxxxx National
Affordable Housing Act of 1990; provided, however, the content and format of the
letter shall have the prior approval of the Purchaser. The Seller shall cause
the Interim Servicer to provide the Purchaser with copies of all such related
notices no later than the Transfer Date.
(b) Notice to Taxing Authorities and Insurance Companies. The Seller
shall cause the Interim Servicer to transmit to the applicable taxing
authorities and insurance companies (including primary mortgage insurance policy
insurers, if applicable) and/or agents, notification of the transfer of the
servicing to the Purchaser, or its designee, and instructions to deliver all
notices, tax bills and insurance statements, as the case may be, to the
Purchaser from and after the Transfer Date. The Seller shall cause the Interim
Servicer to provide the Purchaser with copies of all such notices no later than
the Transfer Date.
(c) Delivery of Servicing Records. The Seller shall cause the Interim
Servicer to forward to the Purchaser, or its designee, all servicing records and
the Servicing File in the Interim Servicer's possession relating to each related
Mortgage Loan including the information enumerated in the Interim Servicing
Agreement (with respect to each such Mortgage Loan, for an interim period, as
specified therein).
(d) Escrow Payments. The Seller shall cause the Interim Servicer to
provide the Purchaser, or its designee, with immediately available funds by wire
transfer in the amount of the net Escrow Payments and suspense balances and all
loss draft balances associated with the related Mortgage Loans. The Seller shall
cause the Interim Servicer to provide the Purchaser with an accounting
statement, in electronic format acceptable to the Purchaser in its sole
discretion, of Escrow Payments and suspense balances and loss draft balances
sufficient to enable the Purchaser to reconcile the amount of such payment with
the accounts of the Mortgage Loans. Additionally, the Seller shall cause the
Interim Servicer to wire transfer to the Purchaser the amount of any agency,
trustee or prepaid Mortgage Loan payments and all other similar amounts held by
the Interim Servicer.
(e) Payoffs and Assumptions. The Seller shall cause the Interim
Servicer to provide to the Purchaser, or its designee, copies of all assumption
and payoff statements
18
generated by the Interim Servicer on the related Mortgage Loans from the related
Cut-off Date to the Transfer Date.
(f) Mortgage Payments Received Prior to Transfer Date. Prior to the
Transfer Date all payments received by the Interim Servicer or the Seller on
each related Mortgage Loan shall be properly applied by the Seller to the
account of the particular Mortgagor.
(g) Mortgage Payments Received after Transfer Date. The amount of any
related Monthly Payments received by the Seller after the Transfer Date shall be
forwarded to the Purchaser by overnight mail on the date of receipt. The Seller
shall notify the Purchaser of the particulars of the payment, which notification
requirement shall be satisfied if the Seller forwards with its payment
sufficient information to permit appropriate processing of the payment by the
Purchaser. The Seller shall assume full responsibility for the necessary and
appropriate legal application of such Monthly Payments received by the Seller
after the Transfer Date with respect to related Mortgage Loans then in
foreclosure or bankruptcy; provided, for purposes of this Agreement, necessary
and appropriate legal application of such Monthly Payments shall include, but
not be limited to, endorsement of a Monthly Payment to the Purchaser with the
particulars of the payment such as the account number, dollar amount, date
received and any special Mortgagor application instructions and the Seller shall
cause the Interim Servicer to comply with the foregoing requirements with
respect to all Monthly Payments received by the Interim Servicer after the
Transfer Date.
(h) Misapplied Payments. Misapplied payments shall be processed as
follows:
(i) All parties shall cooperate in correcting misapplication
errors;
(ii) The party receiving notice of a misapplied payment occurring
prior to the applicable Transfer Date and discovered after the Transfer
Date shall immediately notify the other party;
(iii) If a misapplied payment which occurred prior to the
Transfer Date cannot be identified and said misapplied payment has resulted
in a shortage in a Custodial Account or Escrow Account, the Seller shall be
liable for the amount of such shortage. The Seller shall reimburse the
Purchaser for the amount of such shortage within thirty (30) days after
receipt of written demand therefor from the Purchaser;
(iv) If a misapplied payment which occurred prior to the Transfer
Date has created an improper Purchase Price as the result of an inaccurate
outstanding principal balance, a check shall be issued to the party shorted
by the improper payment application within five (5) Business Days after
notice thereof by the other party; and
(v) Any check issued under the provisions of this Section 8(h)
shall be accompanied by a statement indicating the corresponding Seller
and/or the Purchaser Mortgage Loan identification number and an explanation
of the allocation of any such payments.
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(i) Books and Records. On the Transfer Date, the books, records and
accounts of the Seller with respect to the related Mortgage Loans shall be in
accordance with all applicable Purchaser requirements.
(j) Reconciliation. The Seller shall, on or before the Transfer Date,
reconcile principal balances and make any monetary adjustments required by the
Purchaser. Any such monetary adjustments will be transferred between the Seller
and the Purchaser as appropriate.
(k) IRS Forms. The Seller shall or shall cause the Interim Servicer to
file all IRS forms 1099, 1099A, 1098 or 1041 and K-1 which are required to be
filed on or before the Transfer Date in relation to the servicing and ownership
of the related Mortgage Loans. The Seller shall provide copies of such forms to
the Purchaser upon request and shall reimburse the Purchaser for any costs or
penalties incurred by the Purchaser due to the Seller's failure to comply with
this paragraph. SECTION 9. Representations, Warranties and Covenants of the
Seller; Remedies for Breach. Subsection 9.01 Representations and Warranties
Regarding the Seller. The Seller represents, warrants and covenants to the
Purchaser that as of the date hereof and as of each Closing Date:
(a) Due Organization and Authority. The Seller is a corporation duly
organized, validly existing and in good standing under the laws of the state of
California 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 wherein
it owns or leases any material properties or 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 Seller, and in any event the
Seller 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 and the
Interim Servicing Agreement; the Seller has the full corporate power, authority
and legal right to hold, transfer and convey the Mortgage Loans and to execute
and deliver this Agreement and to perform its obligations hereunder and
thereunder; the execution, delivery and performance of this Agreement (including
all instruments of transfer to be delivered pursuant to this Agreement) by the
Seller and the consummation of the transactions contemplated hereby and thereby
have been duly and validly authorized; this Agreement and all agreements
contemplated hereby have been duly executed and delivered and constitute the
valid, legal, binding and enforceable obligations of the Seller, regardless of
whether such enforcement is sought in a proceeding in equity or at law; and all
requisite corporate or other action has been taken by the Seller to make this
Agreement and all agreements contemplated hereby valid and binding upon the
Seller in accordance with their terms;
(b) Ordinary Course of Business. The consummation of the transactions
contemplated by this Agreement are in the ordinary course of business of the
Seller, and the transfer, assignment and conveyance of the Mortgage Notes and
the Mortgages by the Seller pursuant to this Agreement are not subject to the
bulk transfer or any similar statutory provisions in effect in any applicable
jurisdiction;
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(c) No Conflicts. Neither the execution and delivery of this
Agreement, the acquisition or origination of the Mortgage Loans by the Seller,
the sale of the Mortgage Loans to the Purchaser, the consummation of the
transactions contemplated hereby and thereby, 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, conditions or provisions of the
Seller's charter, by-laws or other organizational documents or any legal
restriction or any agreement or instrument to which the Seller is now a party or
by which it is bound, or constitute a default or result in an acceleration under
any of the foregoing, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Seller or its property is subject, or
result in the creation or imposition of any lien, charge or encumbrance that
would have an adverse effect upon any of its properties pursuant to the terms of
any mortgage, contract, deed of trust or other instrument, or impair the ability
of the Purchaser to realize on the Mortgage Loans, impair the value of the
Mortgage Loans, or impair the ability of the Purchaser to realize the full
amount of any insurance benefits accruing pursuant to this Agreement;
(d) Ability to Service. The Interim Servicer has the facilities,
procedures, and experienced personnel necessary for the sound servicing of
mortgage loans of the same type as the Mortgage Loans. The Interim Servicer is
duly qualified, licensed, registered and otherwise authorized under all
applicable federal, state and local laws, and regulations, if applicable, meets
the minimum capital requirements set forth by the OTS, the OCC or the FDIC, and
is in good standing to enforce, originate, sell mortgage loans to, and service
mortgage loans in each jurisdiction wherein the Mortgaged Properties are
located;
(e) Reasonable Servicing Fee. The Seller, in its capacity as the
Interim Servicer, 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 Interim Servicer, for accounting and tax
purposes, as compensation for the servicing and administration of the Mortgage
Loans pursuant to this Agreement and the Interim Servicing Agreement;
(f) Ability to Perform; Solvency. The Seller 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 Seller is solvent and the sale
of the Mortgage Loans will not cause the Seller to become insolvent. The sale of
the Mortgage Loans is not undertaken with the intent to hinder, delay or defraud
any of Seller's creditors;
(g) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or threatened against the Seller, before any court,
administrative agency or other tribunal asserting the invalidity of this
Agreement, seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or 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 Seller, or in any
material impairment of the right or ability of the Seller to carry on its
business substantially as now conducted, or in any material liability on the
part of the Seller, or which would draw into question the validity of this
Agreement or the Mortgage Loans or of any action taken or to be taken in
connection with the obligations of the Seller contemplated herein, or which
would be likely to impair the ability of the Seller to perform under the terms
of this Agreement;
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(h) No Consent Required. No consent, approval, authorization or order
of, or registration or filing with, or notice to any court or governmental
agency or body including HUD, the FHA or the Department of Veterans Affairs is
required for the execution, delivery and performance by the Seller of or
compliance by the Seller with this Agreement or the Mortgage Loans, the delivery
of a portion of the Mortgage Files to the Custodian or the sale of the Mortgage
Loans or the consummation of the transactions contemplated by this Agreement, or
if required, such approval has been obtained prior to the related Closing Date;
(i) Selection Process. The Mortgage Loans were selected from among the
outstanding one- to four-family mortgage loans in the Seller's portfolio at the
related Closing Date as to which the representations and warranties set forth in
Subsection 9.02 could be made and such selection was not made in a manner so as
to affect adversely the interests of the Purchaser;
(j) Mortgage Loan Package Characteristics. The characteristics of the
related Mortgage Loan Package are as set forth on the description of the pool
characteristics for the applicable Mortgage Loan Package delivered pursuant to
Section 11 on the related Closing Date in the form attached as Exhibit B to each
related Assignment and Conveyance Agreement;
(k) No Untrue Information. Neither this Agreement nor any information,
statement, tape, diskette, report, form, or other document furnished or to be
furnished pursuant to this Agreement or any Reconstitution Agreement or in
connection with the transactions contemplated hereby (including any
Securitization Transaction or Whole Loan Transfer) contains or will contain any
untrue statement of fact or omits or will omit to state a fact necessary to make
the statements contained herein or therein not misleading;
(l) Financial Statements. The Seller has delivered to the Purchaser
financial statements as to its last three complete fiscal years and any later
quarter ended more than 60 days prior to the execution of this Agreement. All
such financial statements fairly present the pertinent results of operations and
changes in financial position for each of such periods and the financial
position at the end of each such period of the Seller and its subsidiaries and
have been prepared in accordance with generally accepted accounting principles
of the United States consistently applied throughout the periods involved,
except as set forth in the notes thereto. In addition, the Seller has delivered
information as to its loan gain and loss experience in respect of foreclosures
and its loan delinquency experience for the immediately preceding three-year
period, in each case with respect to mortgage loans owned by it and mortgage
loans serviced for others during such period, and all such information so
delivered shall be true and correct in all material respects. There has been no
change in the business, operations, financial condition, properties or assets of
the Seller since the date of the Seller's financial statements that would have a
adverse effect on its ability to perform its obligations under this Agreement.
The Seller has completed any forms requested by the Purchaser in a timely manner
and in accordance with the provided instructions;
(m) No Brokers. The Seller 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;
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(n) Sale Treatment. The Seller has been advised by its independent
certified public accountants that under generally accepted accounting principles
the transfer of the Mortgage Loans may be treated as a sale on the books and
records of the Seller and the Seller has determined that the disposition of the
Mortgage Loans pursuant to this Agreement will be afforded sale treatment for
tax and accounting purposes;
(o) Reasonable Purchase Price. The consideration received by the
Seller upon the sale of the Mortgage Loans under this Agreement constitutes fair
consideration and reasonably equivalent value for the Mortgage Loans;
(p) Owner of Record. The Seller is the owner of record of each
Mortgage and the indebtedness evidenced by each Mortgage Note, and upon the sale
of the Mortgage Loans to the Purchaser, the Seller will retain the Mortgage
Files with respect thereto in trust only for the purpose of servicing and
supervising the servicing of each Mortgage Loan;
(q) Seller's Origination. The Seller's decision to originate any
mortgage loan or to deny any mortgage loan application is an independent
decision based upon Seller's underwriting guidelines, and is in no way made as a
result of Purchaser's decision to purchase, or not to purchase, or the price
Purchaser may offer to pay for, any such mortgage loan, if originated; and
(r) Compliance with Anti-Money Laundering Laws. The Seller has
complied with all applicable anti-money laundering laws, regulations and
executive orders, including without limitation the USA Patriot Act of 2001
(collectively, the "Anti-Money Laundering Laws"); the Seller has established an
anti-money laundering compliance program as required by the Anti-Money
Laundering Laws, has conducted the requisite due diligence in connection with
the origination of each Mortgage Loan for purposes of the Anti-Money Laundering
Laws, including with respect to the legitimacy of the applicable Mortgagor and
the origin of the assets used by the said Mortgagor to purchase the property in
question, and maintains, and will maintain, sufficient information to identify
the applicable Mortgagor for purposes of the Anti-Money Laundering Laws;
(s) Delivery to the Custodian. The Mortgage Note, the Mortgage, the
Assignment of Mortgage and any other documents required to be delivered with
respect to each Mortgage Loan pursuant to the Custodial Agreement shall be
delivered to the Custodian all in compliance with the specific requirements of
the Custodial Agreement. With respect to each Mortgage Loan, the Seller will be
in possession of a complete Mortgage File in compliance with Exhibit A hereto,
except for such documents as will be delivered to the Custodian; and
(a) Credit Reporting. The Seller, for so long as it is the Interim
Servicer for each Mortgage Loan, will 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.
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Subsection 9.02 Representations and Warranties Regarding Individual
Mortgage Loans. The Seller hereby represents and warrants to the Purchaser that,
as to each Mortgage Loan, as of the related Closing Date for such Mortgage Loan:
(a) Mortgage Loans as Described. The information set forth in the
Mortgage Loan Schedule is complete, true and correct;
(b) Payments Current. All payments required to be made up to the
Closing Date under the terms of the Mortgage Note have been made and credited.
As of the Closing Date, no payment required under the Mortgage Loan is thirty
(30) days or more delinquent nor has any payment under the Mortgage Loan been
thirty (30) days or more delinquent at any time since the origination of the
Mortgage Loan. The first Monthly Payment after the Cut-off Date shall be made
with respect to the Mortgage Loan on its Due Date or within the grace period,
all in accordance with the terms of the related Mortgage Note;
(c) No Outstanding Charges. There are no defaults in complying with
the terms of the Mortgage securing the Mortgage Loan, and all taxes,
governmental assessments, insurance premiums, water, sewer and municipal
charges, leasehold payments or ground rents which previously became due and
owing have been paid, or an escrow of funds has been established in an amount
sufficient to pay for every such item which remains unpaid and which has been
assessed but is not yet due and payable. Except for (A) payments in the nature
of escrow payments and (B) interest accruing from the date of the Mortgage Note
or date of disbursement of the Mortgage Loan proceeds, whichever is earlier to
the day which precedes by one month the Due Date of the first installment of
principal and interest, including, without limitation, taxes and insurance
payments, the Seller has not advanced funds, or induced, solicited or knowingly
received any advance of funds by a party other than the Mortgagor, directly or
indirectly, for the payment of any amount required under the Mortgage Loan;
(d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any respect,
from the date of origination 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 Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. 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, and which assumption agreement is part of the Mortgage Loan File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the Mortgage Loan
Schedule;
(e) 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
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the defense of usury, and no such right of rescission, set-off, counterclaim or
defense has been asserted with respect thereto, and no Mortgagor was a debtor in
any state or federal bankruptcy or insolvency proceeding at, or subsequent to,
the time the Mortgage Loan was originated;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are provided for in the Xxxxxx Xxx Guides or by
Xxxxxxx Mac, as well as all additional requirements set forth in Section 2.10 of
the Interim Servicing Agreement attached hereto as Exhibit B. If required by the
National Flood Insurance Act of 1968, as amended, each Mortgage Loan is covered
by a flood insurance policy meeting the requirements of the current guidelines
of the Federal Insurance Administration in effect, which policy conforms to
Xxxxxx Xxx and Xxxxxxx Mac, as well as all additional requirements set forth in
Section 2.10 of the Interim Servicing Agreement attached hereto as Exhibit B.
All individual insurance policies contain a standard mortgagee clause naming the
Seller and its successors and assigns as mortgagee, and all premiums thereon
have been paid and such policies may not be reduced, terminated or cancelled
without thirty (30) days' prior written notice to the mortgagee. The Mortgage
obligates the Mortgagor thereunder to maintain the hazard insurance policy at
the Mortgagor's cost and expense, and on the Mortgagor's failure to do so,
authorizes the holder of the Mortgage to obtain and maintain such insurance at
such Mortgagor's cost and expense, and to seek reimbursement therefor from the
Mortgagor. Where required by state law or regulation, the Mortgagor has been
given an opportunity to choose the carrier of the required hazard insurance,
provided the policy is not a "master" or "blanket" hazard insurance policy
covering a condominium, or any hazard insurance policy covering the common
facilities of a planned unit development. The hazard insurance policy is the
valid and binding obligation of the insurer, is in full force and effect, and
will be in full force and effect and inure to the benefit of the Purchaser upon
the consummation of the transactions contemplated by this Agreement. The Seller
has not engaged in, and has no knowledge of the Mortgagor's or any servicer's
having engaged in, any act or omission which would impair the coverage of any
such policy, the benefits of the endorsement provided for herein, or the
validity and binding effect of such policy, including, without limitation, no
unlawful fee, commission, kickback or other unlawful compensation or value of
any kind has been or will be received, retained or realized by any attorney,
firm or other person or entity, and no such unlawful items have been received,
retained or realized by the Seller;
(g) 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,
predatory and abusive lending, equal credit opportunity and disclosure laws
applicable to the Mortgage Loan, including, without limitation, any provisions
relating to prepayment penalties, have been complied with, the consummation of
the transactions contemplated hereby will not involve the violation of any such
laws or regulations, and the Seller 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. This representation is a
Deemed Material Breach Representation;
(h) 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
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executed that would effect any such release, cancellation, subordination or
rescission. The Seller has not waived the performance by the Mortgagor of any
action, if the Mortgagor's failure to perform such action would cause the
Mortgage Loan to be in default, nor has the Seller waived any default resulting
from any action or inaction by the Mortgagor;
(i) Location and Type of Mortgaged Property. The Mortgaged Property is
a fee simple property located in the state identified in the Mortgage Loan
Schedule except that with respect to real property located in jurisdictions in
which the use of leasehold estates for residential properties is a
widely-accepted practice, the Mortgaged Property may be a leasehold estate and
consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a low-rise condominium project, or an individual
unit in a planned unit development and that no residence or dwelling is a mobile
home, provided, however, that any condominium unit or planned unit development
shall not fall within any of the "Ineligible Projects" of part XII, Section 102
of the Xxxxxx Mae Selling Guide and shall conform with the Underwriting
Guidelines. In the case of any Mortgaged Properties that are manufactured homes
(a "Manufactured Home Mortgage Loans"), (A) (i) such Manufactured Home Mortgage
Loan conforms with the applicable Xxxxxx Xxx or Xxxxxxx Mac requirements
regarding mortgage loans related to manufactured dwellings, (ii) the related
manufactured dwelling is permanently affixed to the land, (iii) the related
manufactured dwelling and the related land are subject to a Mortgage properly
filed in the appropriate public recording office and naming Seller as mortgagee,
(iv) the applicable laws of the jurisdiction in which the related Mortgaged
Property is located will deem the manufactured dwelling located on such
Mortgaged Property to be a part of the real property on which such dwelling is
located, (v) such Manufactured Home Mortgage Loan is (x) a qualified mortgage
under Section 860G(a)(3) of the Internal Revenue Code of 1986, as amended and
(y) secured by manufactured housing treated as a single family residence under
Section 25(e)(10) of the Code (i.e., such manufactured home has a minimum of 400
square feet of living space, a minimum width in excess of 102 inches and which
is of a kind customarily used at a fixed location) and (vi) as of the
origination date of the related Mortgage Loan, the related Mortgagor occupied
the related manufactured home as its primary residence. As of the date of
origination, no portion of the Mortgaged Property was used for commercial
purposes, and since the date of origination, no portion of the Mortgaged
Property has been used for commercial purposes; provided, that Mortgaged
Properties which contain a home office shall not be considered as being used for
commercial purposes as long as the Mortgaged Property has not been altered for
commercial purposes and is not storing any chemicals or raw materials other than
those commonly used for homeowner repair, maintenance and/or household purposes.
This representation is a Deemed Material Breach Representation;
(j) Valid First and Second Lien. Each Mortgage is a valid and
subsisting first lien, with respect to First Lien Loans, or second lien, with
respect to Second Lien Loans, of record on a single parcel of real estate
constituting the Mortgaged Property, including all buildings and improvements 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,
subject in all cases to the exceptions to title set forth in the title insurance
policy with respect to the related Mortgage Loan, which exceptions are generally
acceptable to prudent mortgage lending companies, and such other exceptions to
which similar properties are commonly subject and which do not
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individually, or in the aggregate, materially and adversely affect the benefits
of the security intended to be provided by such Mortgage. In no event shall any
Mortgage Loan be in a lien position more junior than a second lien. The lien of
the Mortgage is subject only to:
(1) with respect to Second Lien Loans, the lien of the first
mortgage on the Mortgaged Property;
(2) the lien of current real property taxes and assessments
not yet due and payable;
(3) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date of
recording acceptable to prudent mortgage lending institutions
generally and specifically referred to in the lender's title insurance
policy delivered to the originator of the Mortgage Loan and (a)
specifically referred to or otherwise considered in the appraisal made
for the originator of the Mortgage Loan or (b) which do not adversely
affect the Appraised Value of the Mortgaged Property set forth in such
appraisal; and
(4) 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, enforceable and perfected (A) first lien and first priority security
interest with respect to each First Lien Loan, or (B) second lien and second
priority security interest with respect to each Second Lien Loan, in either
case, on the property described therein and Seller has full right to sell and
assign the same to Purchaser. The Mortgaged Property was not, as of the date of
origination of the Mortgage Loan, subject to a mortgage, deed of trust, deed to
secure debt or other security instrument creating a lien subordinate to the lien
of the Mortgage;
(k) Validity of Mortgage Documents. The Mortgage Note and the Mortgage
and any other agreement executed and delivered by a Mortgagor or guarantor, if
applicable, in connection with a Mortgage Loan are genuine, and each is the
legal, valid and binding obligation of the maker thereof enforceable in
accordance with its terms (including, without limitation, any provisions therein
relating to prepayment penalties). All parties to the Mortgage Note, the
Mortgage and any other such related agreement had legal capacity to enter into
the Mortgage Loan and to execute and deliver the Mortgage Note, the Mortgage and
any other related agreement, and the Mortgage Note, the Mortgage and any other
such related agreement have been duly and properly executed by other such
related parties. The documents, instruments and agreements submitted for loan
underwriting were not falsified and contain no untrue statement of material fact
or omit to state a material fact required to be stated therein or necessary to
make the information and statements therein not misleading. No fraud, error,
omission, misrepresentation, negligence or similar occurrence with respect to a
Mortgage Loan has taken place on the part of any Person, including without
limitation, the Mortgagor, any appraiser, any builder or developer,
-27-
or any other party involved in the origination or servicing of the Mortgage
Loan. The Seller has reviewed all of the documents constituting the Servicing
File and has made such inquiries as it deems necessary to make and confirm the
accuracy of the representations set forth herein;
(l) Full Disbursement of Proceeds. The Mortgage Loan has been closed
and the proceeds of the Mortgage Loan have been fully disbursed and there is no
requirement for future advances thereunder, and any and all requirements as to
completion of any on-site or off-site improvement and as to disbursements of any
escrow funds therefor have been complied with. 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;
(m) Ownership. The Seller is the sole owner of record and holder of
the Mortgage Loan and the indebtedness evidenced by each Mortgage Note and upon
the sale of the Mortgage Loans to the Purchaser, the Seller will retain the
Mortgage Files or any part thereof with respect thereto not delivered to the
Custodian, the Purchaser or the Purchaser's designee, in trust only for the
purpose of servicing and supervising the servicing of each Mortgage Loan. The
Mortgage Loan is not assigned or pledged, and the Seller has good, indefeasible
and marketable title thereto, and has full right to transfer and sell the
Mortgage Loan to the Purchaser free and clear of any encumbrance, equity,
participation interest, lien, pledge, charge, claim or security interest, and
has full right and authority subject to no interest or participation of, or
agreement with, any other party, to sell and assign each Mortgage Loan pursuant
to this Agreement and following the sale of each Mortgage Loan, the Purchaser
will own such Mortgage Loan free and clear of any encumbrance, equity,
participation interest, lien, pledge, charge, claim or security interest. The
Seller intends to relinquish all rights to possess, control and monitor the
Mortgage Loan. After the Closing Date, the Seller will have no right to modify
or alter the terms of the sale of the Mortgage Loan and the Seller will have no
obligation or right to repurchase the Mortgage Loan or substitute another
Mortgage Loan, except as provided in this Agreement;
(n) Doing Business. 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 (2) either (i) organized
under the laws of such state, or (ii) qualified to do business in such state, or
(iii) a federal savings and loan association, a savings bank or a national bank
having a principal office in such state, or (3) not doing business in such
state;
(o) CLTV, LTV; FICO Score. No Mortgage Loan that is a Second Lien Loan
has a CLTV in excess of 100%. No Mortgage Loan has an LTV greater than 100%. At
origination of the Mortgage Loan, the Mortgagor did not have a FICO score of
less than 500;
(p) Title Insurance. The Mortgage Loan is covered by an ALTA lender's
title insurance policy or other generally acceptable form of policy or insurance
acceptable to Xxxxxx Xxx or Xxxxxxx Mac and each such title insurance policy is
issued by a title insurer acceptable to Xxxxxx Mae or Xxxxxxx Mac and qualified
to do business in the jurisdiction where the Mortgaged Property is located,
insuring the Seller, its successors and assigns, as to the first priority lien
(with respect to First Lien Loans) or second priority lien (with respect to
Second Lien Loans) of
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the Mortgage in the original principal amount of the Mortgage Loan, subject only
to the exceptions contained in clauses (1) and (2) of paragraph (j) of this
Subsection 9.02, and in the case of Adjustable Rate Mortgage Loans, against any
loss by reason of the invalidity or unenforceability of the lien resulting from
the provisions of the Mortgage providing for adjustment to the Mortgage Interest
Rate and Monthly Payment. Where required by state law or regulation, the
Mortgagor has been given the opportunity to choose the carrier of the required
mortgage title insurance. Additionally, such lender's title insurance policy
affirmatively insures ingress and egress, and against encroachments by or upon
the Mortgaged Property or any interest therein. The title policy does not
contain any special exceptions (other than the standard exclusions) for zoning
and uses and has been marked to delete the standard survey exception or to
replace the standard survey exception with a specific survey reading. The
Seller, its successor and assigns, are the sole insureds of such lender's title
insurance policy, and such lender's title insurance policy is valid and remains
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 related
Mortgage, including the Seller, has done, by act or omission, anything which
would impair the coverage of such lender's title insurance policy, including
without limitation, no unlawful fee, commission, kickback or other unlawful
compensation or value of any kind has been or will be received, retained or
realized by any attorney, firm or other person or entity, and no such unlawful
items have been received, retained or realized by the Seller;
(q) No Defaults. There is no default, breach, violation or event which
would permit acceleration existing under the Mortgage or the Mortgage Note and
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
which would permit acceleration, and neither the Seller nor any of its
affiliates nor any of their respective predecessors, have waived any default,
breach, violation or event which would permit acceleration. With respect to each
Second Lien Loan, (i) the prior mortgage is in full force and effect, (ii) there
is no default, breach, violation or event of acceleration existing under such
prior mortgage or the related mortgage note, (iii) there is 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 of acceleration
thereunder, and either (A) the prior mortgage contains a provision which allows
or (B) applicable law requires, the mortgagee under the Second Lien Loan to
receive notice of, and affords such mortgagee an opportunity to cure any default
by payment in full or otherwise under the prior mortgage;
(r) 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;
(s) Location of Improvements; No Encroachments. 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. The Mortgaged Property and all improvements located on or
being part of the Mortgaged Property are in compliance with all applicable
zoning and building laws, ordinances and regulations;
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(t) Origination; Payment Terms. The Mortgage Loan was originated by a
mortgagee approved by the Secretary of Housing and Urban Development pursuant to
Sections 203 and 211 of the Act, a savings and loan association, a savings bank,
a commercial bank, credit union, insurance company or other similar institution
which is supervised and examined by a federal or state authority. The documents,
instruments and agreements submitted for loan underwriting were not falsified
and contain no untrue statement of material fact or omit to state a material
fact required to be stated therein or necessary to make the information and
statements therein not misleading. No Mortgage Loan contains terms or provisions
which would result in negative amortization. Principal payments on the Mortgage
Loan commenced no more than sixty days after funds were disbursed in connection
with the Mortgage Loan. The Mortgage Interest Rate as well as, with respect to
Adjustable Rate Mortgage Loans, the Lifetime Rate Cap, the Periodic Rate Floor
and the Periodic Rate Cap are as set forth on Exhibit B to each related
Assignment and Conveyance Agreement. The Mortgage Interest Rate is adjusted,
with respect to Adjustable Rate Mortgage Loans, on each Interest Rate Adjustment
Date to equal the Index plus the Gross Margin (rounded up or down to the nearest
0.125%), subject to the Periodic Rate Cap. The Mortgage Note is payable in equal
monthly installments of principal and interest, which installments of interest,
with respect to Adjustable Rate Mortgage Loans, are subject to change due to the
adjustments to the Mortgage Interest Rate on each Interest Rate Adjustment Date,
with interest calculated and payable in arrears, sufficient to amortize the
Mortgage Loan fully by the stated maturity date (unless the Mortgage Loan is
identified on the Mortgage Loan Schedule as a Balloon Mortgage Loan), over an
original term of not more than thirty years from commencement of amortization.
Unless otherwise specified on the description of pool characteristics for the
applicable Mortgage Loan Package delivered pursuant to Section 11 on the related
Closing Date in the form attached as Exhibit B to each related Assignment and
Conveyance Agreement, the Mortgage Loan is payable on the first day of each
month. There are no Convertible Mortgage Loans which contain a provision
allowing the Mortgagor to convert the Mortgage Note from an adjustable interest
rate Mortgage Note to a fixed interest rate Mortgage Note. The Due Date of the
first payment under the Mortgage Note is no more than 60 days from the date of
the Mortgage Note;
(u) 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. Upon default by a Mortgagor on a Mortgage Loan and
foreclosure on, or trustee's sale of, the Mortgaged Property pursuant to the
proper procedures, the holder of the Mortgage Loan will be able to deliver good
and merchantable title to the Mortgaged Property. 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, subject to applicable federal and state laws and judicial precedent
with respect to bankruptcy and right of redemption or similar law;
(v) Conformance with Agency and Underwriting Guidelines. The Mortgage
Loan was underwritten in accordance with the Underwriting Guidelines (a copy of
which is attached to the related Assignment and Conveyance Agreement as Exhibit
C). The Mortgage Note and Mortgage are on forms acceptable to Xxxxxxx Mac or
Xxxxxx Mae and no
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representations have been made to a Mortgagor that are inconsistent with the
mortgage instruments used;
(w) Occupancy of the Mortgaged Property. As of the Closing Date the
Mortgaged Property is lawfully occupied under applicable law. 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. The Seller has not received notification from any
Governmental Authority that the Mortgaged Property is in material non-compliance
with such laws or regulations, is being used, operated or occupied unlawfully or
has failed to have or obtain such inspection, licenses or certificates, as the
case may be. The Seller has not received notice of any violation or failure to
conform with any such law, ordinance, regulation, standard, license or
certificate. The Mortgagor represented at the time of origination of the
Mortgage Loan that the Mortgagor would occupy the Mortgaged Property as the
Mortgagor's primary residence;
(x) No Additional Collateral. The Mortgage Note is not and has not
been secured by any collateral except the lien of the corresponding Mortgage and
the security interest of any applicable security agreement or chattel mortgage
referred to in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and duly qualified under applicable law to serve as
such, has been properly designated and currently so serves and is named in the
Mortgage (or in the case of a substitution of trustee, is named in a properly
recorded substitution of trustee), and no fees or expenses are or will become
payable by the Purchaser, the Custodian or the Interim Servicer to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor;
(z) Acceptable Investment. There are no circumstances or conditions
with respect to the Mortgage, the Mortgaged Property, the Mortgagor, the
Mortgage File or the Mortgagor's credit standing that can reasonably be expected
to cause private institutional investors to regard the Mortgage Loan as an
unacceptable investment, cause the Mortgage Loan to become delinquent, or
adversely affect the value or marketability of the Mortgage Loan, or cause the
Mortgage Loan to prepay during any period materially faster or slower than the
mortgage loans originated by the Seller generally. No Mortgaged Property is
located in a state, city, county or other local jurisdiction which the Purchaser
has determined in its sole good faith discretion would cause the related
Mortgage Loan to be ineligible for whole loan sale or securitization in a
transaction consistent with the prevailing sale and securitization industry
(including, without limitation, the practice of the rating agencies) with
respect to substantially similar mortgage loans;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the Mortgage,
the Assignment of Mortgage and any other documents required to be delivered
under this Agreement for each Mortgage Loan have been delivered to the
Custodian. The Seller is in possession of a complete, true and accurate Mortgage
File in compliance with Exhibit A hereto, except for such documents the
originals of which have been delivered to the Custodian, and the Seller has
retained copies thereof;
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(bb) Condominiums/Planned Unit Developments. 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
is underwritten in accordance with the Underwriting Guidelines;
(cc) Transfer of Mortgage Loans. Except with respect to MERS
Designated Mortgage Loans, the Assignment of Mortgage with respect to each
Mortgage Loan is in recordable form and is acceptable for recording under the
laws of the jurisdiction in which the Mortgaged Property is located. The
transfer, assignment and conveyance of the Mortgage Notes and the Mortgages by
the Seller are not subject to the bulk transfer or similar statutory provisions
in effect in any applicable jurisdiction;
(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision for the acceleration of the payment
of the unpaid principal balance of the Mortgage Loan in the event that the
Mortgaged Property is sold or transferred without the prior written consent of
the mortgagee thereunder;
(ee) No Balloon Mortgage Loans. The Mortgage Loan is not a Balloon
Mortgage Loan unless specifically listed on the Mortgage Loan Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to which
Monthly Payments are paid or partially paid with funds deposited in any separate
account established by the Seller, the Mortgagor, or anyone on behalf of the
Mortgagor, or paid by any source other than the Mortgagor nor does it contain
any other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan, and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature. The
indebtedness evidenced by the Mortgage Note is not convertible to an ownership
interest in the Mortgaged Property or the Mortgagor and the Seller has not
financed nor does it own directly or indirectly, any equity of any form in the
Mortgaged Property or the Mortgagor;
(gg) Consolidation of Future Advances. Any future advances made to the
Mortgagor prior to the applicable Cut-off Date have been consolidated with the
outstanding principal amount secured by the Mortgage, and the secured principal
amount, as consolidated, bears a single interest rate and single repayment term.
The lien of the Mortgage securing the consolidated principal amount is expressly
insured as having first or second, as applicable, lien priority by a title
insurance policy, an endorsement to the policy insuring the mortgagee's
consolidated interest or by other title evidence acceptable to Xxxxxx Xxx and
Xxxxxxx Mac. The consolidated principal amount does not exceed the original
principal amount of the Mortgage Loan;
(hh) Mortgaged Property Undamaged; No Condemnation Proceedings. There
is no proceeding pending or threatened for the total or partial condemnation of
the Mortgaged Property. The Mortgaged Property is undamaged by waste, 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 and each Mortgaged
Property is in good repair. There have not been any condemnation proceedings
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with respect to the Mortgaged Property and the Seller has no knowledge of any
such proceedings in the future;
(ii) Collection Practices; Escrow Deposits; Interest Rate Adjustments.
The origination, servicing and collection practices with respect to the Mortgage
Loan have been in all respects in compliance with Accepted Servicing Practices,
applicable laws and regulations, and have been in all respects legal and proper.
With respect to escrow deposits and Escrow Payments (other than with respect to
Second Lien Loans for which the mortgagee under the prior mortgage lien is
collecting Escrow Payments), all such payments are in the possession of Seller
and there exist no deficiencies in connection therewith for which customary
arrangements for repayment thereof have not been made. Each Mortgage Loan is
covered by a paid in full, life of loan, tax service contract that has been
assigned without penalty, premium or cost to the Purchaser. All Escrow Payments
have been collected in full compliance with state and federal law and the
provisions of the related Mortgage Note and Mortgage. An escrow of funds is not
prohibited by applicable law and has been established in an amount sufficient 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 Seller have been capitalized under the Mortgage or the Mortgage Note.
All Mortgage Interest Rate adjustments have been made in strict compliance with
state and federal law and the terms of the related Mortgage and Mortgage Note on
the related Interest Rate Adjustment Date. If, pursuant to the terms of the
Mortgage Note, another index was selected for determining the Mortgage Interest
Rate, the same index was used with respect to each Mortgage Note which required
a new index to be selected, and such selection did not conflict with the terms
of the related Mortgage Note. Any and all notices required under applicable law
and the terms of the related Mortgage Note and Mortgage regarding the Mortgage
Interest Rate and the Monthly Payment adjustments have been delivered. Any
interest required to be paid pursuant to state, federal and local law has been
properly paid and credited;
(jj) Mortgage Loan Attributes: The Mortgage Loan has the
characteristics set forth on Exhibit B to the related Assignment and Conveyance
Agreement;
(kk) Other Insurance Policies; No Defense to Coverage. No action,
inaction or event has occurred and no state of facts exists or has existed on or
prior to the Closing Date that has resulted or will result in the exclusion
from, denial of, or defense to coverage under any applicable primary mortgage
insurance policy, hazard insurance policy or bankruptcy bond (including, without
limitation, any exclusions, denials or defenses which would limit or reduce the
availability of the timely payment of the full amount of the loss otherwise due
thereunder to the insured), irrespective of the cause of such failure of
coverage. The Seller has caused or will cause to be performed any and all acts
required to preserve the rights and remedies of the Purchaser in any insurance
policies applicable to the Mortgage Loans including, without limitation, any
necessary notifications of insurers, assignments of policies or interests
therein, and establishments of coinsured, joint loss payee and mortgagee rights
in favor of the Purchaser. In connection with the placement of any such
insurance, no commission, fee, or other compensation has been or will be
received by the Seller or by any officer, director, or employee of the Seller or
any designee of the Seller or any corporation in which the Seller or any
officer, director, or employee had a financial interest at the time of placement
of such insurance;
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(ll) No Violation of Environmental Laws. The Mortgaged Property is
free from any and all toxic or hazardous substances and there exists no
violation of any local, state or federal environmental law, rule or regulation.
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; 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;
(mm) Servicemembers' Civil Relief Act. The Mortgagor has not notified
the Seller, and the Seller has no knowledge of any relief requested or allowed
to the Mortgagor under the Servicemembers' Civil Relief Act of 1940, as amended,
or any similar state statute;
(nn) Appraisal. The Seller has delivered to the Purchaser an appraisal
of the Mortgaged Property signed prior to the approval of the Mortgage
application by an appraiser qualified under Xxxxxx Xxx and Xxxxxxx Mac
guidelines who (i) is licensed in the state where the Mortgaged Property is
located, (ii) has no interest, direct or indirect, in the Mortgaged Property or
in any Loan or the security therefor, and (iii) does not receive compensation
that is affected by the approval or disapproval of the Mortgage Loan. The
appraisal shall have been made within one hundred and eighty (180) days of the
origination of the Mortgage Loan and shall be completed in compliance with the
Uniform Standards of Professional Appraisal Practice, and all applicable Federal
and state laws and regulations. If the appraisal was made more than one hundred
and twenty (120) days before the origination of the Mortgage Loan, the Seller
shall have received and delivered to the Purchaser a recertification of the
appraisal;
(oo) Disclosure Materials. The Mortgagor has, to the extent required
by applicable law, executed a statement to the effect that the Mortgagor has,
received all disclosure materials required by applicable law and the Seller has
complied with all applicable law with respect to the making of the Mortgage
Loans. The Seller shall cause the Interim Servicer to maintain such statement in
the Mortgage File;
(pp) Construction or Rehabilitation of Mortgaged Property. The
Mortgage Loan was not made in connection with the construction or rehabilitation
of a Mortgaged Property or facilitating the trade-in or exchange of a Mortgaged
Property;
(qq) No Defense to Insurance Coverage. No action has been taken or
failed to be taken, no event has occurred and no state of facts exists or has
existed on or prior to the Closing Date (whether or not known to the Seller on
or prior to such date) which has resulted or will result in an exclusion from,
denial of, or defense to coverage under any primary mortgage insurance
(including, without limitation, any exclusions, denials or defenses which would
limit or reduce the availability of the timely payment of the full amount of the
loss otherwise due thereunder to the insured) whether arising out of actions,
representations, errors, omissions, negligence, or fraud of the Seller, the
related Mortgagor or any party involved in the application for such coverage,
including the appraisal, plans and specifications and other exhibits or
documents submitted therewith to the insurer under such insurance policy, or for
any other reason under such coverage, but not including the failure of such
insurer to pay by reason of such insurer's breach of such insurance policy or
such insurer's financial inability to pay. In connection with the placement of
any such insurance, no commission, fee, or other compensation
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has been or will be received by the Seller or any designee of the Seller or any
corporation in which the Seller or any officer, director, or employee had a
financial interest at the time of placement of such insurance;
(rr) Qualified Mortgage. The Mortgage Loan is a qualified mortgage
under Section 860G(a)(3) of the Code;
(ss) Credit Information. As to each consumer report (as defined in the
Fair Credit Reporting Act, Public Law 91-508) or other credit information
furnished by the Seller to the Purchaser, that Seller has full right and
authority and is not precluded by law or contract from furnishing such
information to the Purchaser and the Purchaser is not precluded by the terms of
the Mortgage Loan Documents from furnishing the same to any subsequent or
prospective purchaser of such Mortgage. The Seller shall hold the Purchaser
harmless from any and all damages, losses, costs and expenses (including
attorney's fees) arising from disclosure of credit information in connection
with the Purchaser's secondary marketing operations and the purchase and sale of
mortgages. The Seller has in its capacity as servicer, for each Mortgage Loan,
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. This representation is a Deemed Material Breach Representation;
(tt) Leaseholds. If the Mortgage Loan is secured by a long-term
residential lease, (1) the lessor under the lease holds a fee simple interest in
the land; (2) the terms of such lease expressly permit the mortgaging of the
leasehold estate, the assignment of the lease without the lessor's consent and
the acquisition by the holder of the Mortgage of the rights of the lessee upon
foreclosure or assignment in lieu of foreclosure or provide the holder of the
Mortgage with substantially similar protections; (3) the terms of such lease do
not (a) allow the termination thereof upon the lessee's default without the
holder of the Mortgage being entitled to receive written notice of, and
opportunity to cure, such default, (b) allow the termination of the lease in the
event of damage or destruction as long as the Mortgage is in existence, (c)
prohibit the holder of the Mortgage from being insured (or receiving proceeds of
insurance) under the hazard insurance policy or policies relating to the
Mortgaged Property or (d) permit any increase in rent other than pre-established
increases set forth in the lease; (4) the original term of such lease is not
less than 15 years; (5) the term of such lease does not terminate earlier than
five years after the maturity date of the Mortgage Note; and (6) the Mortgaged
Property is located in a jurisdiction in which the use of leasehold estates in
transferring ownership in residential properties is a widely accepted practice;
(uu) Prepayment Penalty. The Mortgage Loan is subject to a prepayment
penalty as provided in the related Mortgage Note except as set forth on Exhibit
B to each related Assignment and Conveyance Agreement. With respect to each
Mortgage Loan that has a prepayment penalty feature, each such prepayment
penalty is enforceable and will be enforced by the Seller for the benefit of the
Purchaser, and each prepayment penalty is permitted pursuant to federal, state
and local law. Each such prepayment penalty is in an amount equal to the maximum
amount permitted under applicable law and no such prepayment penalty may be
imposed for a term in excess of five (5) years with respect to Mortgage Loans
originated prior to
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October, 1, 2002. With respect to Mortgage Loans originated on or after October
1, 2002, the duration of the prepayment period shall not exceed three (3)
years from the date of the Mortgage Note unless the Mortgage Loan was modified
to reduce the prepayment period to no more than three (3) years from the date of
such Mortgage Note and the Mortgagor was notified in writing of such reduction
in prepayment period. With respect to any Mortgage Loan that contains a
provision permitting imposition of a premium upon a prepayment prior to
maturity: (i) prior to the Mortgage Loan's origination, the Mortgagor agreed to
such premium in exchange for a monetary benefit, including but not limited to a
rate or fee reduction, (ii) prior to the Mortgage Loan's origination, the
Mortgagor was offered the option of obtaining a mortgage loan that did not
require payment of such a premium and (iii) the prepayment premium is disclosed
to the Mortgagor in the loan documents pursuant to applicable state, local and
federal law. This representation is a Deemed Material Breach Representation;
(vv) Assumability. With respect to each Adjustable Rate Mortgage Loan,
the Mortgage Loan Documents provide that after the related first Interest Rate
Adjustment Date, a related Mortgage Loan may only be assumed if the party
assuming such Mortgage Loan meets certain credit requirements stated in the
Mortgage Loan Documents;
(ww) Conversion to Fixed Interest Rate. With respect to Adjustable
Rate Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;
(xx) Escrow Analysis. With respect to each Mortgage, the Seller has
within the last twelve (12) months (unless such Mortgage was originated within
such twelve month period) analyzed the required Escrow Payments for each
Mortgage and adjusted the amount of such payments so that, assuming all required
payments are timely made, any deficiency will be eliminated on or before the
first anniversary of such analysis, or any overage will be refunded to the
Mortgagor, in accordance with RESPA and any other applicable law;
(yy) Predatory Lending Regulations. No Mortgage Loan is a High Cost
Loan or Covered Loan, as applicable, and no Mortgage Loan originated on or after
October 1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending
Act. No Mortgage Loan is covered by the Home Ownership and Equity Protection Act
of 1994 and no Mortgage Loan is in violation of any comparable state or local
law. The Mortgaged Property is not located in a jurisdiction where a breach of
this representation with respect to the related Mortgage Loan may result in
additional assignee liability to the Purchaser, as determined by Purchaser in
its reasonable discretion. This representation is a Deemed Material Breach
Representation;
(zz) Single-Premium Credit Life Insurance Policy. No Mortgagor was
required to purchase any single premium credit insurance policy (e.g., life,
mortgage, disability, property, accident, unemployment or health insurance
product) or debt cancellation agreement as a condition of obtaining the
extension of credit. No Mortgagor obtained a prepaid single-premium credit
insurance policy (e.g., life, mortgage, disability, property, accident,
unemployment, mortgage or health insurance) in connection with the origination
of the Mortgage Loan. No proceeds from any Mortgage Loan were used to purchase
single premium credit insurance policies or debt cancellation agreements as part
of the origination of, or as a condition to closing, such Mortgage Loan. This
representation is a Deemed Material Breach Representation;
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(aaa) Regarding the Mortgagor. The Mortgagor is one or more natural
persons and/or trustees for an Illinois land trust or a trustee under a "living
trust" and such "living trust" is in compliance with Xxxxxx Mae guidelines for
such trusts;
(bbb) Insurance. The Seller has caused or will cause to be performed
any and all acts required to preserve the rights and remedies of the Purchaser
in any insurance policies applicable to the Mortgage Loans including, without
limitation, any necessary notifications of insurers, assignments of policies or
interests therein, and establishments of coinsured, joint loss payee and
mortgagee rights in favor of the Purchaser;
(ccc) Simple Interest Mortgage Loans. The Mortgage Loan is not a
simple interest Mortgage Loan;
(ddd) Flood Certification Contract. The Mortgage Loan is covered by a
paid in full, life of loan, transferable flood certification contract that has
been assigned without penalty, cost or premium to the Purchaser;
(eee) Consent. Either (a) no consent for the Second Lien Loan is
required by the holder of the related first lien or (b) such consent has been
obtained and is contained in the Mortgage File;
(fff) Origination Date. The date of origination of the Mortgage Loan
shall be no earlier than three (3) months prior to the date such Mortgage Loan
is first purchased by the Purchaser;
(ggg) No Exception. The Custodian has not noted any material
exceptions on an Exception Report (as defined in the Custodial Agreement) with
respect to the Mortgage Loan which would materially adversely affect the
Mortgage Loan or the Purchaser's ownership of the Mortgage Loan, unless
consented to by the Purchaser;
(hhh) Mortgage Submitted for Recordation. The Mortgage either has been
or will promptly be submitted for recordation in the appropriate governmental
recording office of the jurisdiction where the Mortgaged Property is located;
(iii) Endorsements. The Mortgage Note has been endorsed by Seller for
its own account and not as a fiduciary, trustee, trustor or beneficiary under a
trust agreement;
(jjj) Accuracy of Information. All information provided to the
Purchaser by the Seller with respect to the Mortgage Loan is accurate in all
material respects;
(kkk) Mortgagor Bankruptcy. On or prior to the date sixty (60) days
after the related Closing Date, the Mortgagor has not filed or will not file a
bankruptcy petition or has not become the subject or will not become the subject
of involuntary bankruptcy proceedings or has not consented to or will not
consent to the filing of a bankruptcy proceeding against it or to a receiver
being appointed in respect of the related Mortgaged Property;
(lll) No Construction Loans. No Mortgage Loan was made in connection
with (a) facilitating the trade-in or exchange of a Mortgaged Property or (b)
the construction or
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rehabilitation of a Mortgaged Property, unless the Mortgage Loan is a
construction-to-permanent mortgage loan listed on the Mortgage Loan Schedule
which has been fully disbursed, all construction work is complete and a
completion certificate has been issued;
(mmm) No Equity Participation. No document relating to the Mortgage
Loan provides for any contingent or additional interest in the form of
participation in the cash flow of the Mortgaged Property or a sharing in the
appreciation of the value of the Mortgaged Property. The indebtedness evidenced
by the Mortgage Note is not convertible to an ownership interest in the
Mortgaged Property or the Mortgagor and Seller has not financed nor does it own
directly or indirectly, any equity of any form in the Mortgaged Property or the
Mortgagor;
(nnn) Proceeds of Mortgage Loan. The proceeds of the Mortgage Loan
have not been and shall not be used to satisfy, in whole or in part, any debt
owed or owing by the Mortgagor to Seller or any Affiliate or correspondent
thereof unless such debt was originated more than 24 months prior to the
origination of such Mortgage Loan;
(ooo) No Arbitration. No Mortgagor with respect to any Mortgage Loan
originated on or after August 1, 2004 agreed to submit to arbitration to resolve
any dispute arising out of or relating in any way to the mortgage loan
transaction. This representation is a Deemed Material Breach Representation;
(ppp) Origination Practices/No Steering. No Mortgagor was encouraged
or required to select a Mortgage Loan product offered by the Mortgage Loan's
originator which is a higher cost product designed for less creditworthy
borrowers, unless at the time of the Mortgage Loan's origination, such Mortgagor
did not qualify taking into account credit history and debt-to-income ratios for
a lower-cost credit product then offered by the Mortgage Loan's originator or
any affiliate of the Mortgage Loan's originator. If, at the time of loan
application, the Mortgagor may have qualified for a lower-cost credit product
then offered by any mortgage lending affiliate of the Mortgage Loan's
originator, the Mortgage Loan's originator referred the Mortgagor's application
to such affiliate for underwriting consideration. This representation is a
Deemed Material Breach Representation;
(qqq) Underwriting Methodology. The methodology used in underwriting
the extension of credit for each Mortgage Loan employs, in part, objective
mathematical principles which relate the Mortgagor's income, assets and
liabilities to the proposed payment and such underwriting methodology does not
rely on the extent of the Mortgagor's equity in the collateral as the principal
determining factor in approving such credit extension. Such underwriting
methodology confirmed that at the time of origination (application/approval) the
Mortgagor had a reasonable ability to make timely payments on the Mortgage Loan.
This representation is a Deemed Material Breach Representation;
(rrr) Points and Fees. No Mortgagor was charged "points and fees"
(whether or not financed) in an amount greater than (i) $1,000 or (ii) 5% of the
principal amount of such Mortgage Loan, whichever is greater. For purposes of
this representation, "points and fees" (x) include origination, underwriting,
broker and finder fees and charges paid to the mortgage or a third party, and
(y) exclude bona fide discount points, fees paid for actual services rendered in
connection with the origination of the Mortgage Loan (such attorneys' fees,
notaries fees and
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fees paid for property appraisals, credit reports, surveys, title examinations
and extracts, flood and tax certifications and home inspections), the costs of
mortgage insurance or credit-risk price adjustments, the costs of title, hazard
and flood insurance policies, state and local transfer taxes or fees, escrow
deposits for the future payment of taxes and insurance premiums, and other
miscellaneous fees and charges that, in total, do not exceed 0.25% of the
principal amount of such Mortgage Loan. This representation is a Deemed Material
Breach Representation;
(sss) Fees Charges. All fees and charges (including finance charges)
and whether or not financed, assessed, collected or to be collected in
connection with the origination and servicing of each Mortgage Loan has been
disclosed in writing to the Mortgagor in accordance with applicable state and
federal law and regulation. This representation is a Deemed Material Breach
Representation; and
(ttt) Second Lien Mortgage Loans. With respect to each Second Lien
Loan: (1) the related First Lien Loan does not permit negative amortization; (2)
where required or customary in the jurisdiction in which the Mortgaged Property
is located, the original lender has filed for record a request for notice of any
action by the related senior lienholder, and the Seller has notified such second
lienholder in writing of the existence of the Second Lien Loan and requested
notification of any action to be taken against the Mortgagor by such senior
lienholder; either (a) no consent for the Second Lien Loan is required by the
holder of the related First Lien Loan or (b) such consent has been obtained and
is contained in the related Mortgage File; (3) to the best of Seller's
knowledge, the related First Lien Loan is in full force and effect, and there is
no default, lien, breach, violation or event which would permit acceleration
existing under such First Lien Loan or Mortgage Note, and 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 which would
permit acceleration under such First Lien Loan; (4) the related first lien
Mortgage contains a provision which provide for giving notice of default or
breach to the mortgagee under the Mortgage Loan and allows such mortgagee to
cure any default under the related first lien Mortgage; and (5) the related
Mortgaged Property was the Mortgagor's principal residence at the time of the
origination of the such Second Lien Loan. This representation is a Deemed
Material Breach Representation.
Subsection 9.03 Remedies for Breach of Representations and Warranties.
It is understood and agreed that the representations and warranties set forth in
Subsections 9.01 and 9.02 shall survive the sale of the Mortgage Loans to the
Purchaser 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 Seller or the Purchaser of a breach of any of the
foregoing representations and warranties, the party discovering such breach
shall give prompt written notice to the other.
Within 60 days of the earlier of either discovery by or notice to the
Seller of any breach of a representation or warranty which materially and
adversely affects the value of the Mortgage Loans or the interest of the
Purchaser therein (or which materially and adversely affects the value of the
applicable Mortgage Loan or the interest of the Purchaser therein in the case of
a representation and warranty relating to a particular Mortgage Loan), the
Seller shall use its best efforts promptly to cure such breach in all material
respects and, if such breach cannot be cured, the Seller shall, at the
Purchaser's option, repurchase such Mortgage Loan at the
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Repurchase Price, together with all expenses incurred by the Purchaser as a
result of such repurchase. Notwithstanding the above sentence, (i) within sixty
(60) days of the earlier of either discovery by, or notice to, the Seller of any
breach of the representation and warranty set forth in clause (rr) of Subsection
9.02, the Seller shall repurchase such Mortgage Loan at the Repurchase Price,
together with all expenses incurred by the Purchaser as a result of such
repurchase and (ii) any breach of a Deemed Material Breach Representation shall
automatically be deemed to materially and adversely affect the value of the
Mortgage Loan and the interest of the Purchaser therein. In the event that a
breach shall involve any representation or warranty set forth in Subsection
9.01, and (except as provided in the preceding sentence with respect to certain
breaches for which no cure is permitted) such breach cannot be cured within
sixty (60) days of the earlier of either discovery by or notice to the Seller of
such breach, all of the Mortgage Loans shall, at the Purchaser's option, be
repurchased by the Seller at the Repurchase Price, together with all expenses
incurred by the Purchaser as a result of such repurchase. However, if the breach
shall involve a representation or warranty set forth in Subsection 9.02 (other
than the representations and warranties set forth in clause (rr) of such
Subsection or any Deemed Material Breach Representation) and the Seller
discovers or receives notice of any such breach within one hundred twenty (120)
days of the related Closing Date, the Seller shall, at the Purchaser's option
and provided that the Seller has a Qualified Substitute Mortgage Loan, rather
than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan
(a "Deleted Mortgage Loan") and substitute in its place a Qualified Substitute
Mortgage Loan or Loans, provided that any such substitution shall be effected
not later than one hundred twenty (120) days after the related Closing Date. If
the Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the
deficient Mortgage Loan. Any repurchase of a Mortgage Loan or Loans pursuant to
the foregoing provisions of this Subsection 9.03 shall be accomplished by either
(a) if the Interim Servicing Agreement has been entered into and is in effect,
deposit in the Custodial Account of the amount of the Repurchase Price for
distribution to the Purchaser on the next scheduled Remittance Date, 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 or
(b) if the Interim Servicing Agreement has not been entered into or is no longer
in effect, by direct remittance of the Repurchase Price to the Purchaser or its
designee in accordance with the Purchaser's instructions.
At the time of repurchase or substitution, the Purchaser and the
Seller shall arrange for the reassignment of the Deleted Mortgage Loan to the
Seller and the delivery to the Seller of any documents held by the Custodian
relating to the Deleted Mortgage Loan. In the event of a repurchase or
substitution, the Seller shall, simultaneously with such reassignment, give
written notice to the Purchaser that such repurchase or substitution has taken
place, amend the Mortgage Loan Schedule to reflect the withdrawal of the Deleted
Mortgage Loan from this Agreement, and, in the case of substitution, identify a
Qualified Substitute Mortgage Loan and amend the Mortgage Loan Schedule to
reflect the addition of such Qualified Substitute Mortgage Loan to this
Agreement. In connection with any such substitution, the Seller shall be deemed
to have made as to such Qualified Substitute Mortgage Loan the representations
and warranties set forth in this Agreement except that all such representations
and warranties set forth in this Agreement shall be deemed made as of the date
of such substitution. The Seller shall effect such substitution by delivering to
the Custodian or to such other party as the Purchaser may designate in writing
for such Qualified Substitute Mortgage Loan the documents required by Subsection
6.03, with the Mortgage Note endorsed as required by Subsection 6.03. No
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substitution will be made in any calendar month after the Determination Date for
such month. The Seller shall cause the Interim Servicer to remit directly to the
Purchaser, or its designee in accordance with the Purchaser's instructions the
Monthly Payment less the Servicing Fee due, if any, on such Qualified Substitute
Mortgage Loan or Loans in the month following the date of such substitution.
Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the
month of substitution shall be retained by the Seller. For the month of
substitution, distributions to the Purchaser shall include the Monthly Payment
due on any Deleted Mortgage Loan in the month of substitution, and the Seller
shall thereafter be entitled to retain all amounts subsequently received by the
Seller in respect of such Deleted Mortgage Loan.
For any month in which the Seller substitutes a Qualified Substitute
Mortgage Loan for a Deleted Mortgage Loan, the Seller shall determine the amount
(if any) by which the aggregate principal balance of all Qualified Substitute
Mortgage Loans as of the date of substitution is less than the aggregate Stated
Principal Balance of all Deleted Mortgage Loans (after application of scheduled
principal payments due in the month of substitution). The amount of such
shortfall shall be distributed by the Seller directly to the Purchaser or its
designee in accordance with the Purchaser's instructions within two (2) Business
Days of such substitution.
In addition to such repurchase or substitution obligation, the Seller
shall indemnify the Purchaser and its present and former directors, officers,
employees and agents and any Successor Servicer and its present and former
directors, officers, employees and agents and hold such parties harmless against
any losses, damages, penalties, fines, forfeitures, legal fees and expenses 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 any representation or warranty contained in this Agreement or any
Reconstitution Agreement. It is understood and agreed that the obligations of
the Seller set forth in this Subsection 9.03 to cure, substitute for or
repurchase a defective Mortgage Loan and to indemnify the Purchaser and
Successor Servicer as provided in this Subsection 9.03 and Subsection 14.01
constitute the sole remedies of the Purchaser and Successor Servicer respecting
a breach of the foregoing representations and warranties. For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean any Person designated as the
Successor Servicer pursuant to this Agreement and any and all Persons who
previously were "Successor Servicers" pursuant to this Agreement.
Any cause of action against the Seller relating to or arising out of
the breach of any representations and warranties made in Subsections 9.01 and
9.02 shall accrue as to any Mortgage Loan upon (i) discovery of such breach by
the Purchaser or notice thereof by the Seller to the Purchaser, (ii) failure by
the Seller to cure such breach or repurchase such Mortgage Loan as specified
above, and (iii) demand upon the Seller by the Purchaser for compliance with
this Agreement.
Subsection 9.04 Repurchase of Mortgage Loans That Prepay in Full. If
any Mortgage Loan is prepaid within one hundred and eighty (180) days from and
after the related Closing Date, the Seller shall pay to the Purchaser, within
three (3) business days of such prepayment in full, an amount equal to the
Premium Percentage multiplied by the outstanding principal balance of such
Mortgage Loan as of the date of such prepayment in full.
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Subsection 9.05 Repurchase of Mortgage Loans with First Payment
Defaults.
(a) If the related Mortgagor is delinquent with respect to the
Mortgage Loan's first Monthly Payment after origination of such Mortgage Loan,
the Seller, at the Purchaser's option exercised in its sole discretion, shall
repurchase such Mortgage Loan from the Purchaser at a price equal to the
percentage of par as stated in the related Purchase Price and Terms Agreement
(subject to adjustment as provided therein) multiplied by the then outstanding
principal balance of such Mortgage Loan, plus accrued and unpaid interest
thereon from the date to which interest was last paid through the day prior to
the repurchase date at the applicable Mortgage Interest Rate, plus any
outstanding advances owed to any servicer in connection with such Mortgage Loan.
(b) If the related Mortgagor is delinquent with respect to the
Mortgage Loan's Monthly Payment due in the month in which the related Closing
Date occurs or the Monthly Payment due in the first two calendar months
following the month in which the related Closing Date occurs, in each case on
its due date or within the grace period, all in accordance with the terms of the
related Mortgage Note, the Seller, at the Purchaser's option exercised in its
sole discretion, shall repurchase such Mortgage Loan from the Purchaser at a
price equal to the percentage of par as stated in the related Purchase Price and
Terms Agreement (subject to adjustment as provided therein) multiplied by the
then outstanding principal balance of such Mortgage Loan, plus accrued and
unpaid interest thereon from the date to which interest was last paid through
the day prior to the repurchase date at the applicable Mortgage Interest Rate,
plus any outstanding advances owed to any servicer in connection with such
Mortgage Loan.
Subsection 9.06 Purchaser's Right to Review. From the related Closing
Date until ninety (90) days after such Closing Date, the Purchaser shall have
the right to review each Mortgage File and Credit File, to conduct property
inspections, obtain appraisal recertifications, drive-by appraisals, brokers
price opinions and otherwise to underwrite the Mortgage Loans and to reject any
Mortgage Loan which in the Purchaser's sole opinion is an unacceptable
investment. In the event that the Purchaser so rejects any Mortgage Loan, the
Seller shall, no later than five (5) Business Days following receipt of notice
of such rejection, repurchase the rejected Mortgage Loan in the manner
prescribed in Subsection 9.03 hereof at the Purchase Price, together with
accrued and unpaid interest at the Mortgage Interest Rate through the date of
repurchase. Any rejected Mortgage Loan shall be removed from the terms of this
Agreement.
All rights of the Purchaser under this Subsection 9.06 shall terminate
upon the transfer of any Mortgage Loan to any other Purchaser.
Notwithstanding the foregoing, the fact that the Purchaser or its
designee has conducted or failed to conduct the review/due diligence procedures
specified above or any other partial or complete examination of the Mortgage
Files or Credit Files shall not impair in any way the Purchaser's or any of its
successors' rights to demand repurchase, substitution or any other remedy
provided under this Agreement.
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SECTION 10. Closing. The closing for the purchase and sale of each
Mortgage Loan Package shall take place on the related Closing Date. At the
Purchaser's option, the Closing shall be either: by telephone, confirmed by
letter or wire as the parties shall agree, or conducted in person, at such place
as the parties shall agree.
The closing for the Mortgage Loans to be purchased on each Closing
Date shall be subject to each of the following conditions:
(a) at least two (2) Business Days prior to the related Closing Date,
the Seller shall deliver to the Purchaser, in electronic format acceptable to
the Purchaser in its sole discretion, a listing on a loan-level basis of the
necessary information to compute the Purchase Price of the Mortgage Loans
delivered on the Closing Date (including accrued interest), and prepare a
Mortgage Loan Schedule;
(b) all of the representations and warranties of the Seller under this
Agreement and of the Interim Servicer under the Interim Servicing Agreement
(with respect to each Mortgage Loan for an interim period, as specified therein)
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 or an Event of Default under the Interim Servicing
Agreement;
(c) the Purchaser shall have received, or the Purchaser's attorneys
shall have received in escrow, all closing documents as specified in Section 11
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 terms hereof;
(d) the Seller shall have delivered and released to the Custodian all
documents required pursuant to this Agreement; and
(e) all other terms and conditions of this Agreement and the related
Purchase Price and Terms Agreement shall have been complied with.
Subject to the foregoing conditions, the Purchaser shall pay to the
Seller on the related Closing Date the Purchase Price, plus accrued interest
pursuant to Section 4 of this Agreement, by wire transfer of immediately
available funds to the account designated by the Seller.
SECTION 11. Closing Documents. The Closing Documents for the Mortgage
Loans to be purchased on each Closing Date shall consist of fully executed
originals of the following documents:
(1) this Agreement (to be executed and delivered only for
the initial Closing Date);
(2) the Interim Servicing Agreement, dated as of the initial
Cut-off Date, in the form of Exhibit B hereto (to be executed and
delivered only for the initial Closing Date);
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(3) with respect to the initial Closing Date, the Custodial
Agreement, dated as of the initial Cut-off Date;
(4) the related Mortgage Loan Schedule, segregated by
Mortgage Loan Package, one copy to be attached hereto, one copy to be
attached to the Custodian's counterpart of the Custodial Agreement,
and one copy to be attached to the related Assignment and Conveyance
as the Mortgage Loan Schedule thereto;
(5) a Custodian's Certification, as required under the
Custodial Agreement, in the form of Exhibit G-1 to the Custodial
Agreement;
(6) with respect to the initial Closing Date, a Custodial
Account Letter Agreement or a Custodial Account Certification, as
applicable, as required under the Interim Servicing Agreement;
(7) with respect to the initial Closing Date, an Escrow
Account Letter Agreement or an Escrow Account Certification, as
applicable, as required under the Interim Servicing Agreement;
(8) with respect to the initial Closing Date, an Officer's
Certificate, in the form of Exhibit C hereto with respect to each of
the Seller and the Interim Servicer, including all attachments hereto;
with respect to subsequent Closing Dates, an Officer's Certificate
upon request of the Purchaser;
(9) with respect to the initial Closing Date, an Opinion of
Counsel of each of the Seller and the Interim Servicer (who may be an
employee of the Seller or the Interim Servicer, as applicable), in the
form of Exhibit D hereto ("Opinion of Counsel of the Seller"); with
respect to subsequent Closing Dates, an Opinion of Counsel of the
Seller upon request of the Purchaser;
(10) with respect to the initial Closing Date, an Opinion of
Counsel of the Custodian (who may be an employee of the Custodian), in
the form of an exhibit to the Custodial Agreement;
(11) a Security Release Certification, in the form of
Exhibit E or F, as applicable, hereto executed by any person, as
requested by the Purchaser, if any of the Mortgage Loans have at any
time been subject to any security interest, pledge or hypothecation
for the benefit of such person;
(12) a certificate or other evidence of merger or change of
name, signed or stamped by the applicable regulatory authority, if any
of the Mortgage Loans were acquired by the Seller by merger or
acquired or originated by the Seller while conducting business under a
name other than its present name, if applicable;
(13) with respect to the initial Closing Date, the
Underwriting Guidelines to be attached to the related Assignment and
Conveyance as Exhibit C;
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(14) Assignment and Conveyance Agreement in the form of
Exhibit H hereto;
(15) Exhibit B to the related Assignment and Conveyance
Agreement; and
(16) a MERS Report reflecting the Purchaser as Investor and
no Person as Interim Funder for each MERS Designated Mortgage Loan.
The Seller shall bear the risk of loss of the closing documents until
such time as they are received by the Purchaser or its attorneys.
SECTION 12. Costs. The Purchaser shall pay any commissions due its
salesmen and the legal fees and expenses of its attorneys and custodial fees.
All other costs and expenses incurred in connection with the transfer and
delivery of the Mortgage Loans and the Servicing Rights including recording
fees, fees for title policy endorsements and continuations, fees for recording
Assignments of Mortgage, and the Seller's attorney's fees, shall be paid by the
Seller.
SECTION 13. Cooperation of Seller with a Reconstitution. The Seller
and the Purchaser agree that with respect to some or all of the Mortgage Loans,
after each Closing Date, on one or more dates (each, a "Reconstitution Date") at
the Purchaser's sole option, the Purchaser may effect a sale (each, a
"Reconstitution") of some or all of the Mortgage Loans then subject to this
Agreement, without recourse, to:
(a) Xxxxxx Xxx under its Cash Purchase Program or MBS Program (Special
Servicing Option) (each, a "Xxxxxx Mae Transfer"); or
(b) Xxxxxxx Mac (the "Xxxxxxx Mac Transfer"); or
(c) one or more third party purchasers in one or more Whole Loan
Transfers; or
(d) one or more trusts or other entities to be formed as part of one
or more Securitization Transactions.
The Seller agrees to execute in connection with any Agency Transfer,
any and all reasonably acceptable pool purchase contracts, and/or agreements
among the Purchaser, the Seller, Xxxxxx Xxx or Xxxxxxx Mac (as the case may be)
and any servicer in connection with a Whole Loan Transfer, a seller's warranties
and servicing agreement or a participation and servicing agreement in form and
substance reasonably acceptable to the parties, and in connection with a
Securitization Transaction, a pooling and servicing agreement in form and
substance reasonably acceptable to the parties or an Assignment and Recognition
Agreement substantially in the form attached hereto as Exhibit J (collectively,
the agreements referred to herein are designated, the "Reconstitution
Agreements"), together with an opinion of counsel with respect to such
Reconstitution Agreements.
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With respect to each Whole Loan Transfer and each Securitization
Transaction entered into by the Purchaser, the Seller agrees (1) to cooperate
fully with the Purchaser and any prospective purchaser with respect to all
reasonable requests and due diligence procedures; (2) to execute, deliver and
perform all Reconstitution Agreements required by the Purchaser; (3) to restate
the representations and warranties set forth in this Agreement and the Interim
Servicing Agreement as of the related Reconstitution Date or make the
representations and warranties set forth in the related selling/servicing guide
of the servicer or issuer, as the case may be, or such representations or
warranties as may be required by any Rating Agency or prospective purchaser of
the related securities or such Mortgage Loans, in connection with such
Reconstitution. The Seller shall provide to such servicer or issuer, as the case
may be, and any other participants or purchasers in such Reconstitution: (i) any
and all information and appropriate verification of information which may be
reasonably available to the Seller or its affiliates, whether through letters of
its auditors and counsel or otherwise, as the Purchaser or any such other
participant shall request; and (ii) such additional representations, warranties,
covenants, opinions of counsel, letters from auditors, and certificates of
public officials or officers of the Seller or the Interim Servicer as are
reasonably believed necessary by the Purchaser or any such other participant;
and (iii) to execute, deliver and satisfy all conditions set forth in any
indemnity agreement required by the Purchaser or any such participant,
including, without limitation, an Indemnification and Contribution Agreement in
substantially the form attached hereto as Exhibit K. Moreover, the Seller agrees
to cooperate with all reasonable requests made by the Purchaser to effect such
Reconstitution Agreements. The Seller shall indemnify the Purchaser, each
affiliate of the Purchaser participating in the Reconstitution and each Person
who controls the Purchaser or such affiliate and their respective present and
former directors, officers, employees and agents, and 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 each of them may sustain in any way related to any information
provided by or on behalf of the Seller regarding the Seller, the Seller's
servicing practices or performance, the Mortgage Loans or the Underwriting
Guidelines set forth in any offering document prepared in connection with any
Reconstitution. For purposes of the previous sentence, "Purchaser" shall mean
the Person then acting as the Purchaser under this Agreement and any and all
Persons who previously were "Purchasers" under this Agreement.
In the event the Purchaser has elected to have the Interim Servicer or
the Seller hold record title to the Mortgages, prior to the Reconstitution Date,
the Interim Servicer or the Seller shall prepare an assignment of mortgage in
blank or to the prospective purchaser or trustee, as applicable, from the
Interim Servicer or the Seller, as applicable, acceptable to the prospective
purchaser or trustee, as applicable, for each Mortgage Loan that is part of the
Reconstitution and shall pay all preparation and recording costs associated
therewith. In connection with the Reconstitution, the Interim Servicer shall
execute or shall cause the Seller to execute each Assignment of Mortgage (except
with respect to each MERS Designated Mortgage Loan), track such Assignments of
Mortgage to ensure they have been recorded and deliver them as required by the
prospective purchaser or trustee, as applicable, upon the Interim Servicer's
receipt thereof. Additionally, the Interim Servicer shall prepare and execute or
shall cause the Seller to execute, at the direction of the Purchaser, any note
endorsement in connection with any and all seller/servicer agreements.
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All Mortgage Loans not sold or transferred pursuant to a
Reconstitution shall remain subject to this Agreement and, if the Interim
Servicing Agreement shall remain in effect with respect to the related Mortgage
Loan Package, shall continue to be serviced in accordance with the terms of this
Agreement and the Interim Servicing Agreement and with respect thereto this
Agreement shall remain in full force and effect.
SECTION 14. The Seller.
Subsection 14.01 Additional Indemnification by the Seller; Third Party
Claims.
(a) The Seller shall indemnify the Purchaser and its present and
former directors, officers, employees and agents and any Successor Servicer and
its present and former directors, officers, employees and agents, and hold such
parties harmless against any and all claims, losses, damages, penalties, fines,
forfeitures, legal fees (including legal fees incurred in connection with the
enforcement of the Seller's indemnification obligation under this Section 14.01)
and related costs, judgments, and any other costs, fees and expenses that such
parties may sustain in any way related to the failure of the Seller to perform
its duties and the Interim Servicer to service the Mortgage Loans in strict
compliance with the terms of this Agreement or any Reconstitution Agreement
entered into pursuant to Section 13 or any breach of any of Seller's
representations, warranties and covenants set forth in this Agreement (provided
that such costs shall not include any lost profits). For purposes of this
paragraph "Purchaser" shall mean the Person then acting as the Purchaser under
this Agreement and any and all Persons who previously were "Purchasers" under
this Agreement and "Successor Servicer" shall mean any Person designated as the
Successor Servicer pursuant to this Agreement and any and all Persons who
previously were "Successor Servicers" pursuant to this Agreement.
(b) Promptly after receipt by an indemnified party under this Section
14.01 of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party under
this Section 14.01, notify the indemnifying party in writing of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
the indemnifying party from any liability which it may have to any indemnified
party under this Section 14.01, except to the extent that it has been prejudiced
in any material respect, or from any liability which it may have, otherwise than
under this Section 14.01. In case any such action is brought against any
indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein, and to
the extent that it may elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice from such indemnified party,
to assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party; provided that if the defendants in any such action include
both the indemnified party and the indemnifying party and the indemnified party
or parties shall have reasonably concluded that there may be legal defenses
available to it or them and/or other indemnified parties which 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 counsel, the
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indemnifying party will not be liable to such indemnified party for expenses
incurred by the indemnified party in connection with the defense thereof unless
(i) the indemnified party shall have employed separate counsel in connection
with the assertion of legal defenses in accordance with the proviso to the next
preceding sentence (it being understood, however, that the indemnifying party
shall not be liable for the expenses of more than one separate counsel (together
with one local counsel, if applicable)), (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 has authorized in
writing the employment of counsel for the indemnified party at the expense of
the indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall be only in respect of the counsel referred to in such
clause (i) or (iii).
Subsection 14.02 Merger or Consolidation of the Seller. The Seller
will keep in full effect its existence, rights and franchises as a corporation
under the laws of the state of its incorporation except as permitted herein, and
will obtain and preserve its qualification to do business as a foreign
corporation 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.
Any Person into which the Seller may be merged or consolidated, or any
corporation resulting from any merger, conversion or consolidation to which the
Seller shall be a party, or any Person succeeding to the business of the Seller,
shall be the successor of the Seller 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
successor or surviving Person shall have a net worth of at least $30,000,000.
SECTION 15. Financial Statements. The Seller understands that in
connection with the Purchaser's marketing of the Mortgage Loans, the Purchaser
shall make available to prospective purchasers audited financial statements of
the Seller for the most recently completed three (3) fiscal years respecting
which such statements are available, as well as a Consolidated Statement of
Condition of the Seller at the end of the last two (2) fiscal years covered by
such Consolidated Statement of Operations. The Seller shall also make available
any comparable interim statements to the extent any such statements have been
prepared by the Seller (and are available upon request to members or
stockholders of the Seller or the public at large). The Seller, if it has not
already done so, agrees to furnish promptly to the Purchaser copies of the
statements specified above. The Seller shall also make available information on
its servicing performance with respect to loans serviced for others, including
delinquency ratios.
The Seller also agrees to allow reasonable access to a knowledgeable
financial or accounting officer for the purpose of answering questions asked by
any prospective purchaser regarding recent developments affecting the Seller or
the financial statements of the Seller.
SECTION 16. Mandatory Delivery; Grant of Security Interest. The sale
and delivery on the related Closing Date of the Mortgage Loans described on the
related Mortgage Loan Schedule is mandatory from and after the date of the
execution of the related Purchase Price and Terms Agreement, it being
specifically understood and agreed that each Mortgage
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Loan is unique and identifiable on the date hereof and that an award of money
damages would be insufficient to compensate the Purchaser for the losses and
damages incurred by the Purchaser (including damages to prospective purchasers
of the Mortgage Loans) in the event of the Seller's failure to deliver (i) each
of the related Mortgage Loans or (ii) one or more Qualified Substitute Mortgage
Loans or (iii) one or more Mortgage Loans otherwise acceptable to the Purchaser
on or before the related Closing Date. The Seller hereby grants to the Purchaser
a lien on and a continuing security interest in each Mortgage Loan and each
document and instrument evidencing each such Mortgage Loan to secure the
performance by the Seller of its obligations under the related Purchase Price
and Terms Agreement, and the Seller agrees that it shall hold such Mortgage
Loans in custody for the Purchaser subject to the Purchaser's (i) right to
reject any Mortgage Loan (or Qualified Substitute Mortgage Loan) under the terms
of this Agreement and to require another Mortgage Loan (or Qualified Substitute
Mortgage Loan) to be substituted therefor, and (ii) obligation to pay the
Purchase Price for the Mortgage Loans. All rights and remedies of the Purchaser
under this Agreement are distinct from, and cumulative with, any other rights or
remedies under this Agreement or afforded by law or equity and all such rights
and remedies may be exercised concurrently, independently or successively.
SECTION 17. Notices. All demands, notices and communications hereunder
shall be in writing and shall be given via email, facsimile transmission or
registered or certified mail to the person at the address set forth below:
(i) if to the Seller:
FlexPoint Funding Corporation
00 Xxxxxxxxx Xxxx, Xxxxx 000
Xxxxxx, XX 00000
Attention: Xxxxxx Xxxxx
Fax: (000) 000-0000
Email: xxxxxx@xxxxxxxxxxx.xxx
(ii) if to the Purchaser:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx Xxxxxxxx
Fax: (000) 000-0000
Email: x.xxxxxxxx@xxxxxx.xxx
with a copy to:
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Fax: (000) 000-0000
Email: xxxxxx.xxxxx@xxxxxx.xxx
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or such other address as may hereafter be furnished to the other party by like
notice. Any such demand, notice or communication hereunder shall be deemed to
have been received on the date delivered to or received at the premises of the
addressee (as evidenced, in the case of registered or certified mail, by the
date noted on the return receipt).
SECTION 18. Severability Clause. Any part, provision representation or
warranty of this Agreement which is prohibited or unenforceable or is held to be
void or unenforceable in any jurisdiction shall be ineffective, as to such
jurisdiction, to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction as to any Mortgage Loan shall not
invalidate or render unenforceable such provision in any other jurisdiction. To
the extent permitted by applicable law, the parties hereto waive any provision
of law which prohibits or renders void or unenforceable any provision hereof. If
the invalidity of any part, provision, representation or warranty of this
Agreement shall deprive any party of the economic benefit intended to be
conferred by this Agreement, the parties shall negotiate, in good-faith, to
develop a structure the economic effect of which is nearly as possible the same
as the economic effect of this Agreement without regard to such invalidity.
SECTION 19. Counterparts. This Agreement may be executed
simultaneously in any number of counterparts. Each counterpart shall be deemed
to be an original, and all such counterparts shall constitute one and the same
instrument.
SECTION 20. Governing Law Jurisdiction; Consent to Service of Process.
THIS AGREEMENT SHALL BE DEEMED IN EFFECT WHEN A FULLY EXECUTED COUNTERPART
THEREOF IS RECEIVED BY THE PURCHASER IN THE STATE OF NEW YORK AND SHALL BE
DEEMED TO HAVE BEEN MADE IN THE STATE OF NEW YORK. THIS AGREEMENT SHALL BE
GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
ITS CHOICE OF LAW RULES AND PRINCIPLES. EACH OF THE PURCHASER AND THE SELLER
IRREVOCABLY (I) SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE
STATE OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE
SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT; (II) WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW,
THE DEFENSE OF AN INCONVENIENT FORUM IN ANY ACTION OR PROCEEDING IN ANY SUCH
COURT; (III) AGREES THAT A FINAL JUDGMENT IN ANY ACTION OR PROCEEDING IN ANY
SUCH COURT SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW; AND (IV) CONSENTS
TO SERVICE OF PROCESS UPON IT BY MAILING A COPY THEREOF BY CERTIFIED MAIL
ADDRESSED TO IT AS PROVIDED FOR NOTICES HEREUNDER.
SECTION 21. Intention of the Parties. It is the intention of the
parties that the Purchaser is purchasing, and the Seller is selling the Mortgage
Loans and not a debt instrument of the Seller or another security. Accordingly,
the parties hereto each intend to treat the transaction for Federal income tax
purposes as a sale by the Seller, and a purchase by the
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Purchaser, of the Mortgage Loans. Moreover, the arrangement under which the
Mortgage Loans are held shall be consistent with classification of such
arrangement as a grantor trust in the event it is not found to represent direct
ownership of the Mortgage Loans. The Purchaser shall have the right to review
the Mortgage Loans and the related Mortgage Loan Files to determine the
characteristics of the Mortgage Loans which shall affect the Federal income tax
consequences of owning the Mortgage Loans and the Seller shall cooperate with
all reasonable requests made by the Purchaser in the course of such review.
SECTION 22. Successors and Assigns; Assignment of Purchase Agreement.
This Agreement shall bind and inure to the benefit of and be enforceable by the
Seller and the Purchaser and the respective permitted successors and assigns of
the Seller and the successors and assigns of the Purchaser. This Agreement shall
not be assigned, pledged or hypothecated by the Seller to a third party without
the prior written consent of the Purchaser, which consent may be withheld by the
Purchaser in its sole discretion. This Agreement may be assigned, pledged or
hypothecated by the Purchaser in whole or in part, and with respect to one or
more of the Mortgage Loans, without the consent of the Seller. There shall be no
limitation on the number of assignments or transfers allowable by the Purchaser
with respect to the Mortgage Loans and this Agreement. In the event the
Purchaser assigns this Agreement, and the assignee assumes any of the
Purchaser's obligations hereunder, the Seller acknowledges and agrees to look
solely to such assignee, and not to the Purchaser, for performance of the
obligations so assumed and the Purchaser shall be relieved from any liability to
the Seller with respect thereto.
SECTION 23. Waivers. No term or provision of this Agreement may be
waived or modified unless such waiver or modification is in writing and signed
by the party against whom such waiver or modification is sought to be enforced.
SECTION 24. Exhibits. The exhibits to this Agreement are hereby
incorporated and made a part hereof and are an integral part of this Agreement.
SECTION 25. General Interpretive 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) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;
(c) 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;
(d) 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;
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(e) 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
(f) the term "include" or "including" shall mean without limitation by
reason of enumeration.
SECTION 26. Reproduction of Documents. This Agreement and all
documents relating thereto, including, without limitation, (a) consents, waivers
and modifications which may hereafter be executed, (b) documents received by any
party at the closing, and (c) financial statements, certificates and other
information previously or hereafter furnished, may be reproduced by any
photographic, photostatic, microfilm, micro-card, miniature photographic or
other similar process. The parties agree that any such reproduction shall be
admissible in evidence as the original itself in any judicial or administrative
proceeding, whether or not the original is in existence and whether or not such
reproduction was made by a party in the regular course of business, and that any
enlargement, facsimile or further reproduction of such reproduction shall
likewise be admissible in evidence.
SECTION 27. Further Agreements. The Seller and the Purchaser each
agree to execute and deliver to the other such reasonable and appropriate
additional documents, instruments or agreements as may be necessary or
appropriate to effectuate the purposes of this Agreement.
SECTION 28. Recordation of Assignments of Mortgage. To the extent
permitted by applicable law, each of the Assignments of Mortgage is subject to
recordation in all appropriate public offices for real property records in all
the counties or their comparable jurisdictions in which any or all of the
Mortgaged Properties are situated, and in any other appropriate public recording
office or elsewhere, such recordation to be effected at the Seller's expense in
the event recordation is either necessary under applicable law or requested by
the Purchaser at its sole option (other than with respect to the MERS Designated
Mortgage Loans).
SECTION 29. No Solicitation. From and after the Closing Date, the
Seller agrees that it will not take any action or permit or cause any action to
be taken by any of its agents or affiliates, or by any independent contractors
on the Seller's behalf, to personally, by telephone or mail (via electronic
means or otherwise), solicit the borrower or obligor under any Mortgage Loan for
any purpose whatsoever, including to refinance a Mortgage Loan, in whole or in
part, without the prior written consent of the Purchaser. It is understood and
agreed that all rights and benefits relating to the solicitation of any
Mortgagors and the attendant rights, title and interest in and to the list of
such Mortgagors and data relating to their Mortgages (including insurance
renewal dates) shall be transferred to the Purchaser pursuant hereto on the
Closing Date and the Seller shall take no action to undermine these rights and
benefits. Notwithstanding the foregoing, it is understood and agreed that
promotions undertaken by the Seller or any affiliate of the Seller which are
directed to the general public at large, including, without limitation, mass
mailing based on commercially acquired mailing lists, newspaper, radio and
television advertisements shall not constitute solicitation under this Section
29.
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SECTION 30. Waiver of Trial by Jury. THE SELLER AND THE PURCHASER EACH
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE
ARISING UNDER OR RELATING TO THIS AGREEMENT.
SECTION 31. Compliance with Regulation AB
Subsection 31.01 Intent of the Parties; Reasonableness.
The Purchaser and the Seller acknowledge and agree that the purpose of
Section 31 of this Agreement 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 Seller 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 Seller 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 Seller 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 Seller, 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.
The Purchaser (including any of its assignees or designees) shall
cooperate with the Seller 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.
Subsection 31.02 Additional Representations and Warranties of the
Seller.
(a) The Seller shall be deemed to represent to the Purchaser and to
any Depositor, as of the date on which information is first provided to the
Purchaser or any Depositor
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under Subsection 31.03 that, except as disclosed in writing to the Purchaser or
such Depositor prior to such date: (i) the Seller 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 Seller; (ii) the Interim Servicer 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;
(iii) no material noncompliance with the applicable servicing criteria with
respect to other securitizations of residential mortgage loans involving the
Interim Servicer as servicer has been disclosed or reported by the Seller; (iv)
no material changes to the Interim Servicer's policies or procedures with
respect to the servicing function it will perform under the Interim Servicing
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; (v) there are no aspects of
the Interim Servicer's financial condition that could have a material adverse
effect on the performance by the Interim Servicer of its servicing obligations
under the Interim Servicing Agreement or any Reconstitution Agreement; (vi)
there are no material legal or governmental proceedings pending (or known to be
contemplated) against the Seller, Interim Servicer, any Subservicer or any
Third-Party Originator; and (vii) there are no affiliations, relationships or
transactions relating to the Seller, Interim Servicer, 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 or any Depositor on any date
following the date on which information is first provided to the Purchaser or
any Depositor under Subsection 31.03, the Seller shall, within five (5) Business
Days following such request, confirm in writing the accuracy of the
representations and warranties set forth in paragraph (a) of this Section 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.
Subsection 31.03 Information to Be Provided by the Seller.
In connection with any Securitization Transaction the Seller shall (i)
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 to provide), in writing and in form and substance
reasonably satisfactory to the Purchaser and such Depositor, the information and
materials specified in paragraphs (a) and (b) of this Section, and (ii) as
promptly as practicable following notice to or discovery by the Seller, 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 (d) of this Section.
(a) If so requested by the Purchaser or any Depositor, the Seller
shall provide such information regarding (i) the Seller, as originator of the
Mortgage Loans (including as an acquirer of Mortgage Loans from a Qualified
Correspondent), or (ii) each Third-Party Originator, 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:
(A) the originator's form of organization;
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(B) 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 or
any Depositor, 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;
(C) a description of any material legal or governmental
proceedings pending (or known to be contemplated) against the Seller
and each Third-Party Originator; and
(D) a description of any affiliation or relationship between the
Seller, each Third-Party Originator and any of the following parties
to a Securitization Transaction, as such parties are identified to the
Seller by the Purchaser or any Depositor in writing in advance of such
Securitization Transaction:
(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.
(b) If so requested by the Purchaser or any Depositor, the Seller
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 (i) the Seller, if the Seller is an originator of Mortgage Loans
(including as an acquirer of Mortgage Loans from a Qualified Correspondent),
and/or (ii) each Third-Party Originator. Such Static Pool Information shall be
prepared by the Seller (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
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available to the Seller (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 Seller, 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 one
hundred thirty-five (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.
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 Seller 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
Seller.
If so requested by the Purchaser or any Depositor, the Seller 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 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
Seller'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 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.
(c) [Reserved].
(d) 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 Seller shall (or shall cause each
Third-Party Originator to) (i) notify the Purchaser and any Depositor in writing
of (A) any material litigation or governmental proceedings pending against the
Seller or any Third-Party Originator and (B) any affiliations or relationships
that develop following the closing date of a Securitization Transaction between
the Seller or any Third-Party Originator and any of the parties specified in
clause (D) of paragraph (a) of this Section (and any other parties identified in
writing by the requesting party) with
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respect to such Securitization Transaction, and (ii) provide to the Purchaser
and any Depositor a description of such proceedings, affiliations or
relationships.
Subsection 31.04 Indemnification; Remedies.
(a) The Seller shall indemnify the Purchaser, each affiliate of the
Purchaser, the Depositor 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:
(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 this Section 31 by or on behalf of the Seller, or provided under
this Section 31 by or on behalf of any Third-Party Originator
(collectively, the "Seller Information"), or (B) the omission or alleged
omission to state in the Seller Information a material fact required to be
stated in the Seller 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 Seller
Information and not to any other information communicated in connection
with a sale or purchase of securities, without regard to whether the Seller
Information or any portion thereof is presented together with or separately
from such other information;
(ii) any failure by the Seller or any Third-Party Originator to
deliver any information, report, certification, accountants' letter or
other material when and as required under this Section 31; or
(iii) any breach by the Seller of a representation or warranty
set forth in Subsection 31.02(a) or in a writing furnished pursuant to
Subsection 31.02(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 Seller of a representation
or warranty in a writing furnished pursuant to Subsection 31.02(b) to the
extent made as of a date subsequent to such closing date.
In the case of any failure of performance described in clause (a)(ii)
of this Section, the Seller 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
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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 Seller or any Third-Party Originator.
(b) (i) Any failure by the Seller or any Third-Party Originator to
deliver any information, report, certification, accountants' letter or other
material when and as required under this Section 31, or any breach by the Seller
of a representation or warranty set forth in Subsection 31.02(a) or in a writing
furnished pursuant to Subsection 31.02(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 Seller of a
representation or warranty in a writing furnished pursuant to Subsection
31.02(b) to the extent made as of a date subsequent to such closing date, shall
immediately and automatically, without notice or grace period, constitute an
Event of Default with respect to the Seller 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 Interim Servicer as servicer under the Interim Servicing
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 Interim Servicer; 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 Interim Servicer as servicer, such
provision shall be given effect.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed hereto by their respective officers thereunto duly authorized
as of the date first above written.
IXIS REAL ESTATE CAPITAL INC.
(Purchaser)
By: /s/ F. Xxxx Xxxxxx
---------------------------------------
Name: F. Xxxx Xxxxxx
Title: Managing Director
By: /s/ Xxxxx Xxxxx
---------------------------------------
Name: Xxxxx Xxxxx
Title: Director
FLEXPOINT FUNDING CORPORATION
(Seller)
By: /s/ Xxxxxx Xxxxx
---------------------------------------
Name: Xxxxxx Xxxxx
Title: EVP of Capital Markets
Exhibit A
EXHIBIT A
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 delivered to the
Custodian, or to such other Person as the Purchaser shall designate in writing,
pursuant to Section 6 of the Second Amended and Restated Mortgage Loan Purchase
and Warranties Agreement to which this Exhibit is attached (the "Agreement"):
(a) the original Mortgage Note bearing all intervening endorsements
evidencing a complete chain of assignment from the originator to the
Seller, endorsed "Pay to the order of IXIS Real Estate Capital Inc.,
without recourse" and signed in the name of the Seller by an authorized
officer. To the extent that there is no room on the face of the Mortgage
Notes for endorsements, the endorsement may be contained on an allonge, if
state law so allows and the Custodian is so advised by the Seller that
state law so allows. If the Mortgage Loan was acquired by the Seller in a
merger, the endorsement must be by "[Seller], successor by merger to [name
of predecessor]." If the Mortgage Loan was acquired or originated by the
Seller while doing business under another name, the endorsement must be by
"[Seller], formerly known as [previous name]";
(b) the original of any guarantee executed in connection with the
Mortgage Note;
(c) the original Mortgage with evidence of recording thereon. If in
connection with any Mortgage Loan, the Seller 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 Seller 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 Seller 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 Seller; 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 to be a
true and complete copy of the original recorded Mortgage;
(d) the originals of all assumption, modification, consolidation or
extension agreements, if any, with evidence of recording thereon;
A-1
(e) except with respect to each MERS Designated Mortgage Loan, the
original Assignment of Mortgage for each Mortgage Loan, in form and
substance acceptable for recording. The Assignment of Mortgage must be duly
recorded only if recordation is either necessary under applicable law or
commonly required by private institutional mortgage investors in the area
where the Mortgaged Property is located or on direction of the Purchaser as
provided in this Agreement. If the Assignment of Mortgage is to be
recorded, the Mortgage shall be assigned to the Purchaser. If the
Assignment of Mortgage is not to be recorded, the Assignment of Mortgage
shall be delivered in blank. If the Mortgage Loan was acquired by the
Seller in a merger, the Assignment of Mortgage must be made by "[Seller],
successor by merger to [name of predecessor]". If the Mortgage Loan was
acquired or originated by the Seller while doing business under another
name, the Assignment of Mortgage must be by "[Seller], formerly known as
[previous name]";
(f) the originals of all intervening assignments of mortgage,
evidencing a complete chain of assignment from the originator to the Seller
(or MERS with respect to each MERS Designated Mortgage Loan), 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 Seller 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 Seller 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 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 Seller; 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;
(g) The original mortgagee policy of title insurance or, in the event
such original title policy is unavailable, a certified true copy of the
related policy binder or commitment for title certified to be true and
complete by the title insurance company; and
(h) security agreement, chattel mortgage or equivalent document
executed in connection with the Mortgage.
In the event an Officer's Certificate of the Seller is delivered to
the Purchaser because of a delay caused by the public recording office in
returning any recorded document, the Seller shall deliver to the Purchaser,
within ninety (90) days of the 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
A-2
recorded document will be delivered to the Custodian; provided, however, that
any recorded document shall in any event be delivered no later than one (1) year
from the applicable Closing Date. An extension of the date specified in (iv)
above may be requested from the Purchaser, which consent shall not be
unreasonably withheld.
A-3
Exhibit B
EXHIBIT B
FORM OF INTERIM SERVICING AGREEMENT
B-1
Exhibit C
EXHIBIT C
FORM OF SELLER'S OFFICER'S CERTIFICATE
I, ____________________, hereby certify that I am the duly elected
[Vice] President of ________________[COMPANY], a [state] [federally] chartered
institution organized under the laws of the [state of ____________] [United
States] (the "Company"), and further as follows:
1. Attached hereto as Exhibit 1 is a true, correct and complete copy
of the charter of the Company which is in full force and effect on the date
hereof and which has been in effect without amendment, waiver, rescission or
modification since ___________.
2. Attached hereto as Exhibit 2 is a true, correct and complete copy
of the bylaws of the Company which are in effect on the date hereof and which
have been in effect without amendment, waiver, rescission or modification since
___________.
3. Attached hereto as Exhibit 3 is an original certificate of good
standing of the Company issued within ten days of the date hereof, and no event
has occurred since the date thereof which would impair such standing.
4. Attached hereto as Exhibit 4 is a true, correct and complete copy
of the corporate resolutions of the Board of Directors of the Company
authorizing the Company to execute and deliver each of the Second Amended and
Restated Mortgage Loan Purchase and Warranties Agreement, dated as of February
1, 2006, by and between IXIS Real Estate Capital Inc. (the "Purchaser") and the
Company (the "Purchase Agreement") and the Amended and Restated Interim
Servicing Agreement, dated as of October 1, 2005, by and between the Company and
the Purchaser (the "Interim Servicing Agreement") and to endorse the Mortgage
Notes and execute the Assignments of Mortgages by original or facsimile
signature, and such resolutions are in effect on the date hereof and have been
in effect without amendment, waiver, rescission or modification since
____________.
5. 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 Purchase
Agreement and the Interim Servicing Agreement, the sale of the mortgage loans or
the consummation of the transactions contemplated by the agreements; or (ii) any
required consent, approval, authorization or order has been obtained by the
Company.
6. Neither the consummation of the transactions contemplated by, nor
the fulfillment of the terms of the Purchase Agreement or the Interim Servicing
Agreement conflicts or will conflict with or results 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 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.
C-1
7. To the best of my knowledge, there is no action, suit, proceeding
or investigation pending or threatened against the Company which, in my
judgment, 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 Purchase Agreement or the Interim
Servicing Agreement, or the mortgage loans or of any action taken or to be taken
in connection with the transactions contemplated hereby, or which would be
likely to impair materially the ability of the Company to perform under the
terms of the Purchase Agreement or the Interim Servicing Agreement.
8. Each person listed on Exhibit 5 attached hereto who, as an officer
or representative of the Company, signed (a) the Purchase Agreement, (b) the
Interim Servicing Agreement and (c) any other document delivered or on the date
hereof in connection with any purchase described in the agreements set forth
above was, at the respective times of such signing and delivery, and is now, a
duly elected or appointed, qualified and acting officer or representative of the
Company, who holds the office set forth opposite his or her name on Exhibit 5,
and the signatures of such persons appearing on such documents are their genuine
signatures.
9. The Company is duly authorized to engage in the transactions
described and contemplated in the Purchase Agreement and the Interim Servicing
Agreement.
C-2
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the
seal of the Company.
Dated: By:
---------------- ------------------------------------
Name:
----------------------------------
[Seal] Title: [Vice] President
I, ________________________, an [Assistant] Secretary of
______________[COMPANY], hereby certify that ____________ is the duly elected,
qualified and acting [Vice] President of the Company and that the signature
appearing above is [her] [his] genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated: By:
---------------- ------------------------------------
Name:
----------------------------------
Title: [Assistant] Secretary
C-3
EXHIBIT 5 to
Company's Officer's Certificate
NAME TITLE SIGNATURE
---- ----- ---------
____________________________ ______________________ ________________________
____________________________ ______________________ ________________________
____________________________ ______________________ ________________________
____________________________ ______________________ ________________________
____________________________ ______________________ ________________________
____________________________ ______________________ ________________________
____________________________ ______________________ ________________________
C-4
Exhibit D
EXHIBIT D
FORM OF OPINION OF COUNSEL TO THE SELLER
AND INTERIM SERVICER (DATE)
IXIS Real Estate Capital Inc.
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
You have requested [our] [my] opinion, as [Assistant] General Counsel
to FlexPoint Funding Corporation (the "Company"), with respect to certain
matters in connection with the sale by the Company of the Mortgage Loans
pursuant to that certain Second Amended and Restated Mortgage Loan Purchase and
Warranties Agreement by and between the Company and IXIS Real Estate Capital
Inc. (the "Purchaser"), dated as of February 1, 2006 (the "Purchase Agreement")
which sale is in the form of whole loans, delivered pursuant to a Custodial
Agreement dated as of June 1, 2005 between the Purchaser and Deutsche Bank
National Trust Company (the "Custodial Agreement") and serviced pursuant to an
Amended and Restated Interim Servicing Agreement, dated as of October 1, 2005,
by and between the FlexPoint Funding Corporation (in such capacity the "Interim
Servicer") and the Purchaser (the "Interim Servicing Agreement" and,
collectively with the Purchase Agreement, the "Agreements"). Capitalized terms
not otherwise defined herein have the meanings set forth in the Purchase
Agreement and the Interim Servicing Agreement.
[We] [I] have examined the following documents:
1. the Purchase Agreement;
2. the Interim Servicing Agreement;
3. the form of Assignment of Mortgage;
4. the form of endorsement of the Mortgage Notes; and
5. such other documents, records and papers as we have deemed
necessary and relevant as a basis for this opinion.
To the extent [we] [I] have deemed necessary and proper, [we] [I] have
relied upon the representations and warranties of the Company and the Interim
Servicer contained in the Purchase Agreement and in the Interim Servicing
Agreement, as applicable. [We] [I] have assumed the authenticity of all
documents submitted to [us] [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 [our] [my] opinion that:
D-1
1. The Company and the Interim Servicer is [type of entity] duly
organized, validly existing and in good standing under the laws of the [United
States] and are qualified to transact business in, and is in good standing
under, the laws of [the state of incorporation].
2. Each of the Company and the Interim Servicer has the power to
engage in the transactions contemplated by the Agreements to which it is a party
and all requisite power, authority and legal right to execute and deliver such
Agreements and to perform and observe the terms and conditions of such
Agreements.
3. Each of the Agreements to which it is a party has been duly
authorized, executed and delivered by the Company and the Interim Servicer, as
applicable, and is a legal, valid and binding agreement enforceable in
accordance with its respective terms against the Company and the Interim
Servicer, as applicable, subject to bankruptcy laws and other similar laws of
general application affecting rights of creditors 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.
4. Each of the Company and the Interim Servicer has been duly
authorized to allow any of its officers to execute any and all documents by
original signature in order to complete the transactions contemplated by the
Agreements to which it is a party by original [or facsimile] signature in order
to execute the endorsements to the Mortgage Notes and the Assignments of
Mortgages, and the original [or facsimile] signature of the officer at the
Company executing the endorsements to the Mortgage Notes and the Assignments of
Mortgages represents the legal and valid signature of said officer of the
Company.
5. 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 or the Interim Servicer of or compliance by the
Company or the Interim Servicer with the Agreements to which it is a party and
the sale of the Mortgage Loans by the Company or the consummation of the
transactions contemplated by the Agreements to which each is a party or (ii) any
required consent, approval, authorization or order has been obtained by the
Company or the Interim Servicer.
6. Neither the consummation of the transactions contemplated by, nor
the fulfillment of the terms of, the Agreements to which it is a party conflicts
or will conflict with or results or will result in a breach of or constitutes or
will constitute a default under the charter, by-laws or other organizational
documents of the Company or the Interim Servicer, as applicable, the terms of
any indenture or other agreement or instrument to which the Company or the
Interim Servicer 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 or
the Interim Servicer is subject or by which it is bound.
7. There is no action, suit, proceeding or investigation pending or
threatened against the Company or the Interim Servicer which, in [our] [my]
judgment, 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 the Interim Servicer or in
D-2
any material impairment of the right or ability of the Company or the Interim
Servicer to carry on its business substantially as now conducted or in any
material liability on the part of the Company or the Interim Servicer or which
would draw into question the validity of the Agreements to which it is a party
or the Mortgage Loans or of any action taken or to be taken in connection with
the transactions contemplated thereby, or which would be likely to impair the
ability of the Company or the Interim Servicer to perform under the terms of the
Agreements to which it is a party.
8. The sale of each Mortgage Note and Mortgage as and in the manner
contemplated by the Agreements is sufficient to fully transfer to the Purchaser
all right, title and interest of the Company thereto as noteholder and
mortgagee.
9. The Mortgages have been duly assigned and the Mortgage Notes have
been duly endorsed as provided in the Purchase Agreement. The Assignments of
Mortgage are in recordable form, except for the insertion of the name of the
assignee, and upon the name of the assignee being inserted, are acceptable for
recording under the laws of the state where each related Mortgaged Property is
located. The endorsement of the Mortgage Notes, the delivery to the Purchaser,
or its designee, of the Assignments of Mortgage, and the delivery of the
original endorsed Mortgage Notes to the Purchaser, or its designee, are
sufficient to permit the Purchaser to avail itself of all protection available
under applicable law against the claims of any present or future creditors of
the Company, and are sufficient to prevent any other sale, transfer, assignment,
pledge or hypothecation of the Mortgages and the Mortgage Notes by the Company
from being enforceable.
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.
Very truly yours,
[Name]
[Assistant] General Counsel
D-3
Exhibit E
EXHIBIT E
FORM OF SECURITY RELEASE CERTIFICATION
_________________, ___
_______________________
_______________________
_______________________
Attention: _____________________________
_____________________________
Re: Notice of Sale and Release of Collateral
Dear Sirs:
This letter serves as notice that FlexPoint Funding Corporation a
corporation, organized pursuant to the laws of California (the "Company") has
committed to sell to IXIS Real Estate Capital Inc. under a Second Amended and
Restated Mortgage Loan Purchase and Warranties Agreement, dated as of February
1, 2006, certain mortgage loans originated by the Company. The Company warrants
that the mortgage loans to be sold to IXIS Real Estate Capital Inc. are in
addition to and beyond any collateral required to secure advances made by you to
the Company.
The Company acknowledges that the mortgage loans to be sold to IXIS
Real Estate Capital Inc. shall not be used as additional or substitute
collateral for advances made by [____________]. IXIS Real Estate Capital Inc.
understands that the balance of the Company's mortgage loan portfolio may be
used as collateral or additional collateral for advances made by [___________],
and confirms that it has no interest therein.
E-1
Execution of this letter by [___________] shall constitute a full and
complete release of any security interest, claim, or lien which [___________]
may have against the mortgage loans to be sold to IXIS Real Estate Capital Inc.
Very truly yours,
----------------------------------------
By:
------------------------------------
Name:
Title:
Date:
Acknowledged and approved:
------------------------------
By:
------------------------------------
Name:
Title:
Date:
Exhibit F
EXHIBIT F
FORM OF SECURITY RELEASE CERTIFICATION
I. Release of Security Interest
The financial institution named below hereby relinquishes any and all
right, title and interest it may have in all Mortgage Loans to be purchased by
IXIS Real Estate Capital Inc. from the Company named below pursuant to that
certain Second Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of February 1, 2006, and certifies that all notes,
mortgages, assignments and other documents in its possession relating to such
Mortgage Loans have been delivered and released to the Company named below or
its designees, as of the date and time of the sale of such Mortgage Loans to
IXIS Real Estate Capital Inc.
Name and Address of Financial Institution
----------------------------------------
(Name)
----------------------------------------
(Address)
By:
------------------------------------
F-1
II. Certification of Release
The Company named below hereby certifies to IXIS Real Estate Capital
Inc. that, as of the date and time of the sale of the above-mentioned Mortgage
Loans to IXIS Real Estate Capital Inc. the security interests in the Mortgage
Loans released by the above-named financial institution comprise all security
interests relating to or affecting any and all such Mortgage Loans. The Company
warrants that, as of such time, there are and will be no other security
interests affecting any or all of such Mortgage Loans.
----------------------------------------
By:
------------------------------------
Name:
Title:
Date:
F-2
Exhibit G
EXHIBIT G
[RESERVED]
G-1
Exhibit H
EXHIBIT H
ASSIGNMENT AND CONVEYANCE
On this ___ day of __________, ____, ___________________ ("Seller"),
as (i) the Seller under that certain Purchase Price and Terms Agreement, dated
as of ___________, _____ (the "PPTA"), (ii) the Seller under that certain Second
Amended and Restated Mortgage Loan Purchase and Warranties Agreement, dated as
of February 1, 2006 (the "Purchase Agreement") and (iii) the Seller/Interim
Servicer under that certain Amended and Restated Interim Servicing Agreement,
dated as of October 1, 2005 (the "Interim Servicing Agreement" and, together
with the PPTA and the Purchase Agreement, the "Agreements") does hereby sell,
transfer, assign, set over and convey to IXIS Real Estate Capital Inc.
("Purchaser") as the Purchaser under the Agreements, 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"), together with the Mortgage Files and all
rights and obligations arising under the documents contained therein. Each
Mortgage Loan subject to the Agreements was underwritten in accordance with, and
conforms to, the Underwriting Guidelines attached hereto as Exhibit C. Pursuant
to Section 6 of the Purchase Agreement, the Seller has delivered to the
Custodian the documents for each Mortgage Loan to be purchased as set forth in
the Custodial Agreement. The contents of each Servicing File required to be
retained by FlexPoint Funding Corporation ("Interim Servicer") to service the
Mortgage Loans pursuant to the Interim Servicing Agreement and thus not
delivered to the Purchaser are and shall be held in trust by the Seller in its
capacity as Interim Servicer for the benefit of the Purchaser as the owner
thereof. The Interim Servicer's possession of any portion of the Servicing File
is at the will of the Purchaser for the sole purpose of facilitating servicing
of the related Mortgage Loan pursuant to the Interim Servicing Agreement, and
such retention and possession by the Interim Servicer shall be in a custodial
capacity only. The ownership of each Mortgage Note, Mortgage, the Servicing
Rights and the contents of the Mortgage File and Servicing File is vested 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
Seller or the Interim Servicer shall immediately vest in the Purchaser and shall
be retained and maintained, in trust, by the Seller at the will of the Purchaser
in such custodial capacity only.
The Mortgage Loan Package characteristics of the Mortgage Loans
subject hereto are set forth on Exhibit B hereto.
In accordance with Section 6 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]
H-1
[SELLER]
By:
------------------------------------
Name:
Title:
Accepted and Agreed:
IXIS REAL ESTATE CAPITAL INC.
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
H-2
EXHIBIT A
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
THE MORTGAGE LOANS
H-3
EXHIBIT B
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE POOL
CHARACTERISTICS OF EACH MORTGAGE LOAN PACKAGE
Pool Characteristics of the Mortgage Loan Package as delivered on the
related Closing Date:
No Mortgage Loan has: (1) an outstanding principal balance less than
$_________; (2) an origination date earlier than _ months prior to the related
Cut-off Date; (3) a CLTV of greater than _____%; (4) a FICO Score of less than
___; or (5) a debt-to-income ratio of more than __%. Each First Lien Loan has a
Mortgage Interest Rate of at least ___% per annum and an outstanding principal
balance less than $_________. Each Second Lien Loan has a Mortgage Interest Rate
of at least ______% per annum and an outstanding principal balance less than
$________. Each Adjustable Rate Mortgage Loan has an Index of [_______].
H-4
EXHIBIT C
TO ASSIGNMENT AND CONVEYANCE AGREEMENT
UNDERWRITING GUIDELINES
H-5
Exhibit I
EXHIBIT I
SELLER'S UNDERWRITING GUIDELINES
I-1
Exhibit J
EXHIBIT J
FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated [____________ __,
20__] ("Agreement"), among IXIS Real Estate Capital Inc. ("Assignor"),
[____________________] ("Assignee") and FlexPoint Funding Corporation (the
"Company"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns
to the Assignee all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain Second Amended
and Restated Mortgage Loan Purchase and Warranties Agreement (the "Purchase
Agreement"), dated as of February 1, 2006, between the Assignor, as purchaser
(the "Purchaser"), and the Company, as seller, solely insofar as the Purchase
Agreement relates to the Mortgage Loans.
The Assignor specifically reserves and does not assign to the Assignee
hereunder (i) any and all right, title and interest in, to and under and any
obligations of the Assignor with respect to any mortgage loans subject to the
Purchase Agreement which are not the Mortgage Loans set forth on the Mortgage
Loan Schedule and are not the subject of this Agreement or (ii) the rights of
the Purchaser under Section 13, Subsection 9.04 and 14.01 of the Purchase
Agreement.
Recognition of the Company
2. From and after the date hereof (the "Securitization Closing Date"),
the Company shall and does hereby recognize that the Assignee will transfer the
Mortgage Loans and assign its rights under the Purchase Agreement (solely to the
extent set forth herein) and this Agreement to [__________________] (the
"Trust") created pursuant to a Pooling and Servicing Agreement, dated as of
[______], 2002 (the "Pooling Agreement"), among the Assignee, the Assignor,
[___________________], as trustee (including its successors in interest and any
successor trustees under the Pooling Agreement, the "Trustee"),
[____________________], as servicer (including its successors in interest and
any successor servicer under the Pooling Agreement, the "Servicer"). The Company
hereby acknowledges and agrees that from and after the date hereof (i) the Trust
will be the owner of the Mortgage Loans, (ii) the Company shall look solely to
the Trust for performance of any obligations of the Assignor insofar as they
relate to the Mortgage Loans, (iii) the Trust (including the Trustee and the
Servicer acting on the Trust's behalf) shall have all the rights and remedies
available to the Assignor, insofar as they relate to the Mortgage Loans, under
the Purchase Agreement, including, without limitation, the enforcement of the
document delivery requirements set forth in Section 6 of the Purchase
J-1
Agreement, and shall be entitled to enforce all of the obligations of the
Company thereunder insofar as they relate to the Mortgage Loans, and (iv) all
references to the Purchaser, the Custodian or the Bailee under the Purchase
Agreement insofar as they relate to the Mortgage Loans, shall be deemed to refer
to the Trust (including the Trustee and the Servicer acting on the Trust's
behalf). Neither the Company nor the Assignor shall amend or agree to amend,
modify, waiver, or otherwise alter any of the terms or provisions of the
Purchase Agreement which amendment, modification, waiver or other alteration
would in any way affect the Mortgage Loans or the Company's performance under
the Purchase Agreement with respect to the Mortgage Loans without the prior
written consent of the Trustee.
Representations and Warranties of the Company
3. The Company warrants and represents to the Assignor, the Assignee
and the Trust as of the date hereof that:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) The Company has full power and authority to execute, deliver and
perform its obligations under this Agreement and has full power and authority to
perform its obligations under the Purchase Agreement. The execution by the
Company of this Agreement is in the ordinary course of the Company's business
and will not conflict with, or result in a breach of, any of the terms,
conditions or provisions of the Company's charter or bylaws or any legal
restriction, or any material agreement or instrument to which the Company is now
a party or by which it is bound, or result in the violation of any law, rule,
regulation, order, judgment or decree to which the Company or its property is
subject. The execution, delivery and performance by the Company of this
Agreement have been duly authorized by all necessary corporate action on part of
the Company. This Agreement has been duly executed and delivered by the Company,
and, upon the due authorization, execution and delivery by the Assignor and the
Assignee, will constitute the valid and legally binding obligation of the
Company, enforceable against the Company in accordance with its terms except as
enforceability may be limited by bankruptcy, reorganization, insolvency,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and by general principles of equity regardless of
whether enforceability is considered in a proceeding in equity or at law;
(c) No consent, approval, order or authorization of, or declaration,
filing or registration with, any governmental entity is required to be obtained
or made by the Company in connection with the execution, delivery or performance
by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation pending or
threatened against the Company, before any court, administrative agency or other
tribunal, which would draw into question the validity of this Agreement or the
Purchase Agreement, or which, either in any one instance or in the aggregate,
would result in any material adverse change in the ability of the Company to
perform its obligations under this Agreement or the Purchase Agreement, and the
Company is solvent.
J-2
4. Pursuant to Section 13 of the Purchase Agreement, the Company
hereby represents and warrants, for the benefit of the Assignor, the Assignee
and the Trust, that the representations and warranties set forth in Section 9.02
of the Purchase Agreement are true and correct as of the date hereof as if such
representations and warranties were made on the date hereof unless otherwise
specifically stated in such representations and warranties.
Remedies for Breach of Representations and Warranties
5. The Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee and
the Servicer acting on the Trust's behalf) in connection with any breach of the
representations and warranties made by the Company set forth in Sections 3 and 4
hereof shall be as set forth in Subsection 9.03 of the Purchase Agreement as if
they were set forth herein (including without limitation the repurchase and
indemnity obligations set forth therein).
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced, with the prior
written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors and
assigns of the parties hereto and (ii) the Trust (including the Trustee and the
Servicer acting on the Trust's behalf). Any entity into which Assignor, Assignee
or Company may be merged or consolidated shall, without the requirement for any
further writing, be deemed Assignor, Assignee or Company, respectively,
hereunder.
9. Each of this Agreement and the Purchase Agreement shall survive the
conveyance of the Mortgage Loans and the assignment of the Purchase Agreement
(to the extent assigned hereunder) by Assignor to Assignee and by Assignee to
the Trust and nothing contained herein shall supersede or amend the terms of the
Purchase Agreement.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreement with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the Purchase Agreement.
J-3
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
FLEXPOINT FUNDING CORPORATION
By:
------------------------------------
Name:
Its:
IXIS REAL ESTATE Capital Inc.
By:
------------------------------------
Name:
Its:
By:
------------------------------------
Name:
Its:
[ ]
--------------------------
By:
------------------------------------
Name:
Its:
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
MORTGAGE LOAN SCHEDULE
J-2
Exhibit K
EXHIBIT K
FORM OF INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AND CONTRIBUTION AGREEMENT ("Agreement"), dated
as of [_______], 200_, among IXIS Real Estate Capital Inc., a New York
corporation ("IXIS"), [_____________], a [_______________] (the "Seller") and
[_____________], a [_______________] [(the "Initial Servicer")].
WHEREAS, [________________] (the "Depositor"), is acting as depositor
and registrant with respect to the Prospectus, dated [________________], and the
Prospectus Supplement to the Prospectus, [________________] (the "Prospectus
Supplement"), relating to [________________] Certificates (the "Certificates")
to be issued pursuant to a Pooling and Servicing Agreement, dated as of
[________________] (the "P&S"), among the Depositor, as depositor,
[________________], as servicer (the "Servicer"), and [________________], as
trustee (the "Trustee");
WHEREAS, as an inducement to the Depositor to enter into the P&S, and
[____________________] (the "Underwriter[s]") to enter into the Underwriting
Agreement, dated [____________________] (the "Underwriting Agreement") between
the Depositor and the Underwriter[s], Seller has agreed to provide for
indemnification and contribution on the terms and conditions hereinafter set
forth;
WHEREAS, IXIS purchased from Seller certain of the Mortgage Loans
underlying the Certificates (the "Mortgage Loans") from Seller pursuant to a
Second Amended and Restated Mortgage Loan Purchase and Warranties Agreement,
dated as of February 1, 2006 (the "Purchase Agreement"), by and between IXIS and
Seller; and
WHEREAS, pursuant to Section 13 of the Purchase Agreement, Seller has
agreed to indemnify IXIS, the Depositor, the Underwriter[s] and their respective
affiliates, present and former directors, officers, employees and agents.
NOW THEREFORE, in consideration of the agreements contained herein,
and other valuable consideration the receipt and sufficiency of which are hereby
acknowledged, Seller and IXIS agree as follows:
1. Indemnification and Contribution.
(a) Seller [and Initial Servicer] agrees to indemnify and hold
harmless IXIS, the Depositor, the Underwriter[s] and their respective
affiliates, present and former directors, officers, employees and agents and
each person, if any, who controls IXIS, the Depositor, the Underwriter[s] or
such affiliate within the meaning of either Section 15 of the Securities Act of
1933, as amended (the "1933 Act"), or Section 20 of the Securities Exchange Act
of 1934, as amended (the "1934 Act"), against any and all losses, claims,
damages or liabilities, joint or several, to which they or any of them may
become subject under the 1933 Act, the 1934 Act or other federal or state
statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based in
K-1
whole or in part upon (i) any breach of the representation set forth in Section
2(vii) below and (ii) any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus Supplement, ABS Informational and
Computational Material or in the Free Writing Prospectus or any omission or
alleged omission to state in the Prospectus Supplement, ABS Informational and
Computational Material or in the Free Writing Prospectus 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, or any such
untrue statement or omission or alleged untrue statement or alleged omission
made in any amendment of or supplement to the Prospectus Supplement, ABS
Informational and Computational Material or the Free Writing Prospectus and
agrees to reimburse IXIS, the Depositor, the Underwriter[s] or such affiliates
and each such officer, director, employee, agent and controlling person promptly
upon demand for any legal or other expenses reasonably incurred by any of them
in connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that Seller [and Initial Servicer] shall be liable in any
such case only to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in reliance upon and in
conformity with the Seller Information [and Servicer Information]. The foregoing
indemnity agreement is in addition to any liability which Seller [and the
Initial Servicer] may otherwise have to IXIS, the Depositor, the Underwriter[s]
its affiliates or any such director, officer, employee, agent or controlling
person of IXIS, the Depositor, the Underwriter[s] or their respective
affiliates.
As used herein:
"ABS Informational and Computational Material" means any written
communication as defined in Item 1101(a) of Regulation AB under the 1933 Act and
the 1934 Act, as amended from time to time.
"Free Writing Prospectus" means any written communication that
constitutes a "free writing prospectus," as defined in Rule 405 under the 1933
Act.
"Regulation AB" means Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. Sections 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.
"Seller Information" means any information relating to Seller, the
Mortgage Loans and/or the underwriting guidelines [and/or servicing guidelines]
relating to the Mortgage Loans set forth in the Prospectus Supplement, ABS
Informational and Computational Material or the Free Writing Prospectus [and
static pool information regarding mortgage loans originated or acquired by the
Seller [and included in the Prospectus Supplement, ABS Informational and
Computational Material, the Offering Circular or the Free Writing Prospectus]
[incorporated by reference from the website located at [______________]].
K-2
["Servicer Information" means any information relating to Initial
Servicer, the Mortgage Loans and/or the servicing guidelines relating to the
Mortgage Loans set forth in the Prospectus Supplement, ABS Informational and
Computational Material or the Free Writing Prospectus [and static pool
information regarding mortgage loans originated or acquired by the Initial
Servicer [and included in the Prospectus Supplement, the Offering Circular, ABS
Informational and Computational Material or the Free Writing Prospectus]
[incorporated by reference from the website located at [______________].]
(b) Promptly after receipt by any indemnified party under this Section
1 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 this Section 1, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 1 except to the extent it has
been materially prejudiced by such failure; and provided, further, however, that
the failure to notify any indemnifying party shall not relieve it from any
liability which it may have to any indemnified party otherwise than under this
Section 1.
If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, except as provided in
the following paragraph, the indemnifying party shall not be liable to the
indemnified party under this Section 1 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation.
Any indemnified party shall have the right to employ separate counsel
in any such action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
necessary or appropriate for such indemnified party to employ separate counsel;
or (iii) the indemnifying party has failed to assume the defense of such action
and employ counsel reasonably satisfactory to the indemnified party, in which
case, if such indemnified party notifies the indemnifying party in writing that
it elects to employ separate counsel at the expense of the indemnifying party,
the indemnifying party shall not have the right to assume the defense of such
action on behalf of such indemnified party, it being understood, however, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to local counsel) at any time for all such indemnified parties.
K-3
Each indemnified party, as a condition of the indemnity agreements
contained in this Section 1, shall cooperate with the indemnifying party in the
defense of any such action or claim. No indemnifying party shall be liable for
any settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment for the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any indemnified
party from and against any loss or liability by reason of such settlement or
judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified
party shall have requested an indemnifying party to reimburse the indemnified
party for reasonable fees and expenses of counsel, the indemnifying party agrees
that it shall be liable for any settlement of any proceeding effected without
its written consent if (i) such settlement is entered into more than 30 days
after receipt by such indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement.
(c) If the indemnification provided for in this Section 1 is
unavailable to an indemnified party, then the indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages or
liabilities, in such proportion as is appropriate to reflect the relative fault
of the indemnifying party and the indemnified party, respectively, in connection
with the statements or omissions that result in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault of the indemnified party and indemnifying party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by such parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission and any other equitable considerations.
(d) The indemnity and contribution agreements contained in this
Section 1 and the representations and warranties set forth in Section 2 shall
remain operative and in full force and effect regardless of (i) any termination
of this Agreement, (ii) any investigation made by IXIS, the Depositor, the
Underwriter[s] their respective affiliates, directors, officers, employees or
agents or any person controlling IXIS, the Depositor, the Underwriter[s] or any
such affiliate and (iii) acceptance of and payment for any of the Offered
Certificates.
2. Representations and Warranties. Seller [and Initial Servicer]
represents and warrants that:
(i) Seller [and Initial Servicer] is validly existing and in good
standing under the laws of its jurisdiction of formation or incorporation,
as applicable, and has full power and authority to own its assets and to
transact the business in which it is currently engaged. Seller [and Initial
Servicer] is duly qualified to do business and is in good standing in each
jurisdiction in which the character of the business transacted by it or any
properties owned or leased by it requires such qualification and in which
the failure so to qualify would have a material adverse effect on the
business, properties, assets or condition (financial or otherwise) of
Seller [and Initial Servicer];
K-4
(ii) Seller [and Initial Servicer] is not required to obtain the
consent of any other person or any consent, license, approval or
authorization from, or registration or declaration with, any governmental
authority, bureau or agency in connection with the execution, delivery,
performance, validity or enforceability of this Agreement;
(iii) the execution, delivery and performance of this Agreement
by Seller [and Initial Servicer] will not violate any provision of any
existing law or regulation or any order decree of any court applicable to
Seller [and Initial Servicer] or any provision of the charter or bylaws of
Seller [and Initial Servicer], or constitute a material breach of any
mortgage, indenture, contract or other agreement to which Seller is a party
or by which it may be bound;
(iv) (a) no proceeding of or before any court, tribunal or
governmental body is currently pending or, (b) to the knowledge of Seller
[and Initial Servicer], threatened against Seller [and Initial Servicer] or
any of its properties or with respect to this Agreement or the Offered
Certificates, in either case, which would have a material adverse effect on
the business, properties, assets or condition (financial or otherwise) of
Seller [and Initial Servicer];
(v) Seller [and Initial Servicer] has full power and authority to
make, execute, deliver and perform this Agreement and all of the
transactions contemplated hereunder, and has taken all necessary corporate
action to authorize the execution, delivery and performance of this
Agreement. When executed and delivered, this Agreement will constitute the
legal, valid and binding obligation of each of Seller [and Initial
Servicer] enforceable in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors'
rights generally, by the availability of equitable remedies, and by
limitations of public policy under applicable securities law as to rights
of indemnity and contribution thereunder;
(vi) this Agreement has been duly executed and delivered by
Seller [and Initial Servicer]; and
(vii) Seller Information satisfies the requirements of the
applicable provisions of Regulation AB.
3. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to Seller [and Initial Servicer], will
be mailed, delivered or telegraphed and confirmed [______________________]; or,
if sent to IXIS, will be mailed, delivered or telegraphed and confirmed to IXIS
Real Estate Capital Inc., 0 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: General Counsel.
4. Miscellaneous. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York without giving effect to
the conflict of laws provisions thereof. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their successors and
assigns and the controlling persons referred to herein, and no other person
shall have any right or obligation hereunder. Neither this Agreement nor any
term
K-5
hereof may be changed, waived, discharged or terminated orally, but only by an
instrument in writing signed by the party against whom enforcement of the
change, waiver, discharge or termination is sought. This Agreement may be
executed in counterparts, each of which when so executed and delivered shall be
considered an original, and all such counterparts shall constitute one and the
same instrument. Capitalized terms used but not defined herein shall have the
meanings provided in the P&S.
[Remainder of Page Intentionally Left Blank]
K-6
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective officers hereunto duly authorized, this
__th day of [_____________].
IXIS REAL ESTATE CAPITAL INC.
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
[SELLER]
By:
------------------------------------
Name:
Title:
[INITIAL SERVICER]
By:
------------------------------------
Name:
Title:
EXHIBIT EE
FUNDING AMERICA AGREEMENTS
EE-1
EXECUTION COPY
ASSIGNMENT AND RECOGNITION AGREEMENT
THIS ASSIGNMENT AND RECOGNITION AGREEMENT, dated January 30, 2007
("Agreement"), between IXIS Real Estate Capital Inc. ("Assignor"), Xxxxxx
Xxxxxxx ABS Capital I Inc. ("Assignee"), Funding America Mortgage Warehouse
Trust ("FAMWT") and Funding America Mortgage Warehouse Trust I ("FAMWTI" and
together with FAMWT, the "Companies"):
For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:
Assignment and Conveyance
1. The Assignor hereby conveys, sells, grants, transfers and assigns
to the Assignee all of the right, title and interest of the Assignor, as
purchaser, in, to and under (a) those certain Mortgage Loans listed on the
schedule (the "Mortgage Loan Schedule") attached hereto as Exhibit A (the
"Mortgage Loans") and (b) except as described below, that certain (i) Amended
and Restated Mortgage Loan Purchase and Warranties Agreement, dated as of
October 1, 2006 (the "Trust Purchase Agreement"), among the Assignor, as
purchaser (the "Purchaser"), FAMWT and Ocwen Loan Servicing, LLC ("Ocwen"), and
(ii) the Mortgage Loan Purchase and Warranties Agreement, dated as of October 1,
2006 (the "Trust I Purchase Agreement," and together with the Trust Purchase
Agreement, the "Purchase Agreements"), among the Purchaser, FAMWTI, as seller,
and Ocwen, solely insofar as the Purchase Agreements relate to the Mortgage
Loans.
The Assignor specifically reserves and does not assign to the Assignee
hereunder (i) any and all right, title and interest in, to and under and any
obligations of the Assignor with respect to any mortgage loans subject to the
applicable Purchase Agreement which are not the Mortgage Loans set forth on the
Mortgage Loan Schedule and are not the subject of this Agreement or (ii) the
rights of the Purchaser (a) under Subsection 8.04 of the applicable Purchase
Agreement or (b) to any premium recapture (i.e., the excess, if any, of the
purchase price percentage over par) in connection with any repurchase pursuant
to Subsections 8.03 and 8.05 of the applicable Purchase Agreement.
Recognition of the Company
2. From and after the date hereof (the "Securitization Closing Date"),
each Company shall and does hereby recognize that the Assignee will transfer the
Mortgage Loans and assign its rights under the applicable Purchase Agreement
(solely to the extent set forth herein) and this Agreement to IXIS Real Estate
Capital Trust 2007-HE1 (the "Trust") created pursuant to a Pooling and Servicing
Agreement, dated as of January 1, 2007 (the "Pooling Agreement"), among the
Assignee, the Assignor, Deutsche Bank National Trust Company, as trustee (in
such capacity, including its successors in interest and any successor trustees
under the Pooling Agreement, the "Trustee"), Xxxxx Fargo Bank, National
Association, as securities administrator (in such capacity, including its
successors in interest and any successor securities administrators under the
Pooling Agreement, the "Securities Administrator"), master servicer (in
1
such capacity, including its successors in interest and any successor master
servicers under the Pooling Agreement, the "Master Servicer") and Saxon Mortgage
Services Inc., as servicer (including their successors in interest and any
successor servicer under the Pooling Agreement, the "Servicer"). Each Company
hereby acknowledges and agrees that from and after the date hereof (i) the Trust
will be the owner of the Mortgage Loans, (ii) such Company shall look solely to
the Trust for performance of any obligations of the Assignor insofar as they
relate to the Mortgage Loans, (iii) the Trust (including the Trustee, the
Securities Administrator, the Master Servicer and the Servicer acting on the
Trust's behalf) shall have all the rights and remedies available to the
Assignor, insofar as they relate to the Mortgage Loans, under the applicable
Purchase Agreement, including, without limitation, the enforcement of the
document delivery requirements set forth in Section 6 of such Purchase
Agreement, and shall be entitled to enforce all of the obligations of such
Company thereunder insofar as they relate to the Mortgage Loans, and (iv) all
references to the Purchaser, the Custodian or the Bailee under the applicable
Purchase Agreement insofar as they relate to the Mortgage Loans, shall be deemed
to refer to the Trust (including the Trustee, the Securities Administrator, the
Master Servicer and the Servicer acting on the Trust's behalf). No Company nor
the Assignor shall amend or agree to amend, modify, waiver, or otherwise alter
any of the terms or provisions of the applicable Purchase Agreement which
amendment, modification, waiver or other alteration would in any way affect the
Mortgage Loans or the applicable Company's performance under the applicable
Purchase Agreement with respect to the Mortgage Loans without the prior written
consent of the Trustee.
Representations and Warranties of the Company
3. Each Company warrants and represents to the Assignor, the Assignee
and the Trust as of the date hereof that:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its formation;
(b) The Company has full power and authority to execute, deliver
and perform its obligations under this Agreement and has full power and
authority to perform its obligations under the applicable Purchase
Agreement. The execution by the Company of this Agreement is in the
ordinary course of the Company's business and will not conflict with, or
result in a breach of, any of the terms, conditions or provisions of the
Company's organizational documents or any legal restriction, or any
material agreement or instrument to which the Company is now a party or by
which it is bound, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Company or its property is subject.
The execution, delivery and performance by the Company of this Agreement
have been duly authorized by all necessary trust action on the part of the
Company. This Agreement has been duly executed and delivered by the
Company, and, upon the due authorization, execution and delivery by the
Assignor and the Assignee, will constitute the valid and legally binding
obligation of the Company, enforceable against the Company in accordance
with its terms except as enforceability may be limited by bankruptcy,
reorganization, insolvency, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally, and by general
principles of equity regardless of whether enforceability is considered in
a proceeding in equity or at law;
2
(c) No consent, approval, order or authorization of, or
declaration, filing or registration with, any governmental entity is
required to be obtained or made by the Company in connection with the
execution, delivery or performance by the Company of this Agreement; and
(d) There is no action, suit, proceeding or investigation pending
or threatened against the Company, before any court, administrative agency
or other tribunal, which would draw into question the validity of this
Agreement or the applicable Purchase Agreement, or which, either in any one
instance or in the aggregate, would result in any material adverse change
in the ability of the Company to perform its obligations under this
Agreement or the applicable Purchase Agreement, and the Company is solvent.
4. Pursuant to Section 12 of the applicable Purchase Agreement, each
Company hereby represents and warrants, for the benefit of the Assignor, the
Assignee and the Trust, that the representations and warranties set forth in
Subsection 8.01 of the applicable Purchase Agreement are true and correct as of
the date hereof as if such representations and warranties were made on the date
hereof, and that the representations and warranties set forth on Exhibit B
attached hereto are true and correct as of the date or dates set forth thereon.
Remedies for Breach of Representations and Warranties
5. Each Company hereby acknowledges and agrees that the remedies
available to the Assignor, the Assignee and the Trust (including the Trustee,
the Securities Administrator, the Master Servicer and the Servicer acting on the
Trust's behalf) in connection with any breach of the representations and
warranties made by such Company set forth in Sections 3 and 4 hereof shall be as
set forth in Subsection 9.03 of the applicable Purchase Agreement as if they
were set forth herein (including without limitation the repurchase and indemnity
obligations set forth therein); provided, however, that the Assignor
specifically reserves and does not assign to the Assignee hereunder any and all
right, title and interest in the Premium Percentage, if any, due in connection
with the repurchase of a Mortgage Loan pursuant to Subsections 8.03, 8.04 and
8.05 of the applicable Purchase Agreement.
Miscellaneous
6. This Agreement shall be construed in accordance with the laws of
the State of New York, without regard to conflicts of law principles, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
7. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced, with the prior
written consent of the Trustee.
8. This Agreement shall inure to the benefit of (i) the successors and
assigns of the parties hereto and (ii) the Trust (including the Trustee, the
Securities Administrator, the Master Servicer and the Servicer acting on the
Trust's behalf). Any entity into which Assignor, Assignee or any Company may be
merged or consolidated shall, without the requirement for any
3
further writing, be deemed Assignor, Assignee or the applicable Company,
respectively, hereunder.
9. Each of this Agreement and each Purchase Agreement shall survive
the conveyance of the Mortgage Loans and the assignment of the Purchase
Agreements (to the extent assigned hereunder) by Assignor to Assignee and by
Assignee to the Trust and nothing contained herein shall supersede or amend the
terms of the Purchase Agreements.
10. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original and all such
counterparts shall constitute one and the same instrument.
11. In the event that any provision of this Agreement conflicts with
any provision of the Purchase Agreements with respect to the Mortgage Loans, the
terms of this Agreement shall control.
12. Capitalized terms used in this Agreement (including the exhibits
hereto) but not defined in this Agreement shall have the meanings given to such
terms in the applicable Purchase Agreement.
4
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
FUNDING AMERICA MORTGAGE
WAREHOUSE TRUST
(Seller)
By: Funding America, LLC, as
administrator
By: /s/ Xxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Manager
FUNDING AMERICA MORTGAGE
WAREHOUSE TRUST I
(Seller)
By: Funding America, LLC, as
administrator
By: /s/ Xxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Manager
IXIS REAL ESTATE CAPITAL INC.
By: /s/ F. Xxxx Xxxxxx
------------------------------------
Name: F. Xxxx Xxxxxx
Its: Managing Director
By: /s/ Xxxxxxxxxxx Xxxxxx
------------------------------------
Name: Xxxxxxxxxxx Xxxxxx
Its: Managing Director
XXXXXX XXXXXXX ABS CAPITAL I INC.
By: /s/ Xxxxxxx Xxx
------------------------------------
Name: Xxxxxxx Xxx
Its: Vice President
5
EXHIBIT A TO ASSIGNMENT AND RECOGNITION AGREEMENT
MORTGAGE LOAN SCHEDULE
EXHIBIT B TO ASSIGNMENT AND RECOGNITION AGREEMENT
REPRESENTATIONS AND WARRANTIES AS TO THE MORTGAGE LOANS.
Each Company hereby represents and warrants to the Purchaser that, as
to each Mortgage Loan such Company sold to the Purchaser, as of the date on
which such transferred servicing of the Mortgage Loan to the Purchaser, or its
designee (the "Transfer Date"), unless otherwise set forth herein:
(a) Mortgage Loans as Described. The information set forth in the
Mortgage Loan Schedule delivered to the Purchaser, or its designee, in
connection with the servicing transfer, is complete, true and correct;
(b) Payments Current. Except as set forth on the mortgage loan
schedule delivered to the Purchaser by the Company on the Transfer Date, no
payment required under the Mortgage Loan is thirty (30) days or more delinquent
nor has any payment under the Mortgage Loan been thirty (30) days or more
delinquent at any time since the origination of the Mortgage Loan.
(c) No Outstanding Charges. Except as set forth on the mortgage loan
schedule delivered to the Purchaser by the Company on the Transfer Date, there
are no defaults in complying with the terms of the Mortgage securing the
Mortgage Loan, and all taxes, governmental assessments, insurance premiums,
water, sewer and municipal charges, leasehold payments or ground rents which
previously became due and owing have been paid, or an escrow of funds has been
established in an amount sufficient to pay for every such item which remains
unpaid and which has been assessed but is not yet due and payable. As of the
closing date for the Securitization Transaction (the "Securitization Closing
Date"), except for (A) payments in the nature of escrow payments and (B)
interest accruing from the date of the Mortgage Note or date of disbursement of
the Mortgage Loan proceeds, whichever is earlier to the day which precedes by
one (1) month the Due Date of the first installment of principal and interest,
including, without limitation, taxes and insurance payments, the Company has not
advanced funds, or induced, solicited or knowingly received any advance of funds
by a party other than the Mortgagor, directly or indirectly, for the payment of
any amount required under the Mortgage Loan;
(d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any respect,
from the date of origination 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 Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. 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, and which assumption agreement is part of the Mortgage Loan File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the related
Mortgage Loan Schedule;
(e) 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, and no Mortgagor
was a debtor in any state or federal bankruptcy or insolvency proceeding at, or
subsequent to, the time the Mortgage Loan was originated;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are provided for in the Xxxxxx Mae Guides or by
Xxxxxxx Mac, as well as all additional requirements set forth in Section 2.10 of
the Interim Servicing Agreement. If required by the National Flood Insurance Act
of 1968, as amended, each Mortgage Loan is covered by a flood insurance policy
meeting the requirements of the current guidelines of the Federal Insurance
Administration in effect, which policy conforms to Xxxxxx Mae and Xxxxxxx Mac,
as well as all additional requirements set forth in Section 2.10 of the Interim
Servicing Agreement. All individual insurance policies contain a standard
mortgagee clause naming the Company (or the Originator) and its successors and
assigns as mortgagee, and all premiums thereon have been paid and such policies
may not be reduced, terminated or cancelled without thirty (30) days' prior
written notice to the mortgagee. The Mortgage obligates the Mortgagor thereunder
to maintain the hazard insurance policy at the Mortgagor's cost and expense, and
on the Mortgagor's failure to do so, authorizes the holder of the Mortgage to
obtain and maintain such insurance at such Mortgagor's cost and expense, and to
seek reimbursement therefor from the Mortgagor. Where required by state law or
regulation, the Mortgagor has been given an opportunity to choose the carrier of
the required hazard insurance, provided the policy is not a "master" or
"blanket" hazard insurance policy covering a condominium, or any hazard
insurance policy covering the common facilities of a planned unit development.
The hazard insurance policy is the valid and binding obligation of the insurer,
is in full force and effect, and will be in full force and effect and inure to
the benefit of the Purchaser upon the consummation of the transactions
contemplated by this Agreement. As of the Securitization Closing Date, the
Company has not engaged in, and has no knowledge of the Mortgagor's or any
servicer's having engaged in, any act or omission which would impair the
coverage of any such policy, the benefits of the endorsement provided for
herein, or the validity and binding effect of such policy, including, without
limitation, no unlawful fee, commission, kickback or other unlawful compensation
or value of any kind has been or will be received, retained or realized by any
attorney, firm or other person or entity, and no such unlawful items have been
received, retained or realized by the Company;
(g) Compliance with Applicable Laws. As of the Securitization Closing
Date, 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, predatory, abusive and fair lending, equal credit
opportunity and disclosure laws applicable to the Mortgage Loan, including,
without limitation, any provisions relating to prepayment penalties, have been
complied with, the consummation of the transactions contemplated hereby will not
involve the violation of any such laws or regulations, and the Company or the
Interim Servicer 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. This
representation is a Deemed Material Breach Representation;
(h) 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 release,
cancellation, subordination or rescission. The Company has not waived the
performance by the Mortgagor of any action, if the Mortgagor's failure to
perform such action would cause the Mortgage Loan to be in default, nor has the
Company waived any default resulting from any action or inaction by the
Mortgagor;
(i) Location and Type of Mortgaged Property. The Mortgaged Property is
a fee simple property located in the state identified in the Mortgage Loan
Schedule except that with respect to real property located in jurisdictions in
which the use of leasehold estates for residential properties is a
widely-accepted practice, the Mortgaged Property may be a leasehold estate and
consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a condominium project, or an individual unit in
a planned unit development and that no residence or dwelling is a mobile home,
provided, however, that any condominium unit or planned unit development shall
not fall within any of the "Ineligible Projects" of part XII, Section 102 of the
Xxxxxx Mae Selling Guide and shall conform with the Underwriting Guidelines. In
the case of any Mortgaged Properties that are manufactured homes (a
"Manufactured Home Mortgage Loans"), (A) (i) such Manufactured Home Mortgage
Loan conforms with the applicable Xxxxxx Xxx or Xxxxxxx Mac requirements
regarding mortgage loans related to manufactured dwellings, (ii) the related
manufactured dwelling is permanently affixed to the land, (iii) the related
manufactured dwelling and the related land are subject to a Mortgage properly
filed in the appropriate public recording office and naming Company as
mortgagee, (iv) the applicable laws of the jurisdiction in which the related
Mortgaged Property is located will deem the manufactured dwelling located on
such Mortgaged Property to be a part of the real property on which such dwelling
is located, (v) such Manufactured Home Mortgage Loan is (x) a qualified mortgage
under Section 860G(a)(3) of the Internal Revenue Code of 1986, as amended and
(y) secured by manufactured housing treated as a single family residence under
Section 25(e)(10) of the Code (i.e., such manufactured home has a minimum of 400
square feet of living space, a minimum width in excess of 102 inches and which
is of a kind customarily used at a fixed location) and (vi) as of the
origination date of the related Mortgage Loan, the related manufactured housing
unit that secures such Mortgage Loan either: (x) was the principal residence of
the Mortgagor or (y) was classified as real property under applicable state law.
As of the date of origination, no portion of the Mortgaged Property was used for
commercial purposes, and to the best of the Company's knowledge since the
Closing Date, no portion of the Mortgaged Property has been used for commercial
purposes; provided, that Mortgaged Properties which contain a home office shall
not be considered as being used for commercial purposes as long as the Mortgaged
Property has not been altered for commercial purposes and is not storing any
chemicals or raw materials other than those commonly used for homeowner repair,
maintenance and/or household purposes. This representation is a Deemed Material
Breach Representation;
(j) Valid First and Second Lien. Each Mortgage is a valid and
subsisting first lien, with respect to First Lien Loans, or second lien, with
respect to Second Lien Loans, of record on a single parcel of real estate
constituting the Mortgaged Property, including all buildings and improvements 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,
subject in all cases to the exceptions to title set forth in the title insurance
policy with respect to the related Mortgage Loan, which exceptions are generally
acceptable to prudent mortgage lending companies, and such other exceptions to
which similar properties are commonly subject and which do not individually, or
in the aggregate, materially and adversely affect the benefits of the security
intended to be provided by such Mortgage. In no event shall any Mortgage Loan be
in a lien position more junior than a second lien. The lien of the Mortgage is
subject only to:
(1) with respect to Second Lien Loans, the lien of the first
mortgage on the Mortgaged Property;
(2) the lien of current real property taxes and assessments
not yet due and payable;
(3) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date
of recording acceptable to prudent mortgage lending institutions
generally and specifically referred to in the lender's title
insurance policy delivered to the originator of the Mortgage Loan
and (a) specifically referred to or otherwise considered in the
appraisal made for the originator of the Mortgage Loan or (b)
which do not adversely affect the Appraised Value of the
Mortgaged Property set forth in such appraisal; and
(4) 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, enforceable and perfected (A) first lien and first priority security
interest with respect to each First Lien Loan, or (B) second lien and second
priority security interest with respect to each Second Lien Loan, in either
case, on the property described therein and Company has full right to sell and
assign the same to Purchaser. The Mortgaged Property was not, unless indicated
on the related Mortgage Loan Schedule in the case of a First Lien Loan, as of
the date of origination of the Mortgage Loan, subject to a mortgage, deed of
trust, deed to secure debt or other security instrument creating a lien
subordinate to the lien of the Mortgage;
(k) Validity of Mortgage Documents. As of the Securitization Closing
Date, (i) the Mortgage Note and the Mortgage and any other agreement executed
and delivered by a Mortgagor or guarantor, if applicable, in connection with a
Mortgage Loan are genuine, and each is the legal, valid and binding obligation
of the maker thereof enforceable in accordance with its
terms (including, without limitation, any provisions therein relating to
prepayment penalties); (ii) all parties to the Mortgage Note, the Mortgage and
any other such related agreement had legal capacity to enter into the Mortgage
Loan and to execute and deliver the Mortgage Note, the Mortgage and any other
related agreement, and the Mortgage Note, the Mortgage and any other such
related agreement have been duly and properly executed by other such related
parties; (iii) the documents, instruments and agreements submitted for loan
underwriting were not falsified and contain no untrue statement of material fact
or omit to state a material fact required to be stated therein or necessary to
make the information and statements therein not misleading; and (iv) no fraud,
error, omission, misrepresentation, negligence or similar occurrence with
respect to a Mortgage Loan has taken place on the part of any Person, including
without limitation, the Mortgagor, any appraiser, any builder or developer, or
any other party involved in the origination or servicing (with respect to
servicing, as of the Transfer Date) of the Mortgage Loan. As of the Transfer
Date, the Company has reviewed all of the documents constituting the Servicing
File and has made such inquiries as it deems necessary to make and confirm the
accuracy of the representations set forth herein;
(l) Full Disbursement of Proceeds. The Mortgage Loan has been closed
and the proceeds of the Mortgage Loan have been fully disbursed and there is no
requirement for future advances thereunder, and any and all requirements as to
completion of any on-site or off-site improvement and as to disbursements of any
escrow funds therefor have been complied with. As of the Securitization Closing
Date, 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;
(m) Ownership. As of the Closing Date, the Company was the sole owner
of record and holder of the Mortgage Loan and the indebtedness evidenced by each
Mortgage Note and upon the sale of the Mortgage Loans to the Purchaser, the
Company will retain the Mortgage Files or any part thereof with respect thereto
not delivered to the Custodian, the Purchaser or the Purchaser's designee, in
trust only for the purpose of servicing and supervising the servicing of each
Mortgage Loan. The Mortgage Loan was not assigned or pledged, and the Company
had good, indefeasible and marketable title thereto, and had full right to
transfer and sell the Mortgage Loan to the Purchaser free and clear of any
encumbrance, equity, participation interest, lien, pledge, charge, claim or
security interest, and has full right and authority subject to no interest or
participation of, or agreement with, any other party, to sell and assign each
Mortgage Loan pursuant to this Agreement and following the sale of each Mortgage
Loan, the Purchaser owned such Mortgage Loan free and clear of any encumbrance,
equity, participation interest, lien, pledge, charge, claim or security
interest.. As of the Closing Date, the Company relinquished all rights to
possess, control and monitor the Mortgage Loan. As of the Closing Date, the
Company has had and will have no right to modify or alter the terms of the sale
of the Mortgage Loan and the Company will have no obligation or right to
repurchase the Mortgage Loan or substitute another Mortgage Loan, except as
provided in this Agreement;
(n) Doing Business. 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 (2) either (i) organized
under the laws of such state, or (ii) qualified to do business in such state,
or (iii) a federal savings and loan association, a savings bank or a national
bank having a principal office in such state, or (3) not doing business in such
state;
(o) CLTV, LTV; FICO Score. As of the Securitization Closing Date, no
Mortgage Loan that is a Second Lien Loan has an original CLTV in excess of 100%.
No Mortgage Loan has an original LTV greater than 100%. At origination of the
Mortgage Loan, the Mortgagor did not have a FICO score of less than 500;
(p) Title Insurance. The Mortgage Loan is covered by an ALTA lender's
title insurance policy or other generally acceptable form of policy or insurance
acceptable to Xxxxxx Xxx or Xxxxxxx Mac and each such title insurance policy is
issued by a title insurer acceptable to 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
(with respect to First Lien Loans) or second priority lien (with respect to
Second Lien Loans) of the Mortgage in the original principal amount of the
Mortgage Loan, subject only to the exceptions contained in clauses (1) and (2)
of paragraph (j) of this Exhibit B, and in the case of Adjustable Rate Mortgage
Loans, against any loss by reason of the invalidity or unenforceability of the
lien resulting from the provisions of the Mortgage providing for adjustment to
the Mortgage Interest Rate and Monthly Payment. Where required by state law or
regulation, the Mortgagor has been given the opportunity to choose the carrier
of the required mortgage title insurance. Additionally, such lender's title
insurance policy affirmatively insures ingress and egress, and against
encroachments by or upon the Mortgaged Property or any interest therein. The
title policy does not contain any special exceptions (other than the standard
exclusions) for zoning and uses and has been marked to delete the standard
survey exception or to replace the standard survey exception with a specific
survey reading. The Company, its successor and assigns, are the sole insureds of
such lender's title insurance policy, and such lender's title insurance policy
is valid and remains 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 related Mortgage, including the Company, has done, by act or
omission, anything which would impair the coverage of such lender's title
insurance policy, including without limitation, no unlawful fee, commission,
kickback or other unlawful compensation or value of any kind has been or will be
received, retained or realized by any attorney, firm or other person or entity,
and no such unlawful items have been received, retained or realized by the
Company;
(q) No Defaults. Except as set forth in the Mortgage Loan Schedule,
there is no default, breach, violation or event which would permit acceleration
existing under the Mortgage or the Mortgage Note and 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 which would permit
acceleration, and neither the Company nor any of its affiliates nor any of their
respective predecessors, have waived any default, breach, violation or event
which would permit acceleration. With respect to each Second Lien Loan, (i) the
prior mortgage is in full force and effect, (ii) there is no default, breach,
violation or event of acceleration existing under such prior mortgage or the
related mortgage note, (iii) there is 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 of acceleration thereunder, and either (A)
the prior mortgage contains a provision which allows or (B) applicable law
requires, the mortgagee under the Second Lien
Loan to receive notice of, and affords such mortgagee an opportunity to cure any
default by payment in full or otherwise under the prior mortgage;
(r) 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 covered by the
title insurance specified in clause (p);
(s) Location of Improvements; No Encroachments. 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. The Mortgaged Property and all improvements located on or
being part of the Mortgaged Property are in compliance with all applicable
zoning and building laws, ordinances and regulations;
(t) Origination; Payment Terms. As of the Securitization Closing Date,
the Mortgage Loan was originated by a mortgagee approved by the Secretary of
Housing and Urban Development pursuant to Sections 203 and 211 of the Act, a
savings and loan association, a savings bank, a commercial bank, credit union,
insurance company or other similar institution which is supervised and examined
by a federal or state authority. The documents, instruments and agreements
submitted for loan underwriting were not falsified and contain no untrue
statement of material fact or omit to state a material fact required to be
stated therein or necessary to make the information and statements therein not
misleading. No Mortgage Loan contains terms or provisions which would result in
negative amortization. Other than with respect to Mortgage Loans that require
only payments of interest for a specified period of time after origination,
principal payments on the Mortgage Loan commenced no more than sixty (60) days
after funds were disbursed in connection with the Mortgage Loan. The Mortgage
Interest Rate as well as, with respect to Adjustable Rate Mortgage Loans, the
Lifetime Rate Cap, the Periodic Rate Floor and the Periodic Rate Cap are as set
forth on the related Mortgage Loan Schedule. The Mortgage Interest Rate is
adjusted, with respect to Adjustable Rate Mortgage Loans, on each Interest Rate
Adjustment Date to equal the Index plus the Gross Margin (rounded up or down to
the nearest 0.125%), subject to the Periodic Rate Cap. Other than with respect
to Mortgage Loans that require only payments of interest for a specified period
of time after origination, the Mortgage Note is payable in equal monthly
installments of principal and interest, which installments of interest, with
respect to Adjustable Rate Mortgage Loans, are subject to change due to the
adjustments to the Mortgage Interest Rate on each Interest Rate Adjustment Date,
with interest calculated and payable in arrears, sufficient to amortize the
Mortgage Loan fully by the stated maturity date (unless the Mortgage Loan is
identified on the related Mortgage Loan Schedule as a Balloon Mortgage Loan),
over an original term of not more than thirty (30) years from commencement of
amortization (except in the case of Mortgage Loans which have a stated maturity
of 30 years but amortized based on a 40 year schedule). Unless otherwise
specified on the related Mortgage Loan Schedule, the Mortgage Loan is payable on
the first day of each month. There are no Convertible Mortgage Loans which
contain a provision allowing the Mortgagor to convert the Mortgage Note from an
adjustable interest rate Mortgage Note to a fixed interest rate Mortgage Note.
The Due Date of the first payment under the Mortgage Note is no more than sixty
(60) days from the date of the Mortgage Note;
(u) 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. Upon default by a Mortgagor on a Mortgage Loan and
foreclosure on, or trustee's sale of, the Mortgaged Property pursuant to the
proper procedures, the holder of the Mortgage Loan will be able to deliver good
and merchantable title to the Mortgaged Property. 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, subject to applicable federal and state laws and judicial precedent
with respect to bankruptcy and right of redemption or similar law;
(v) Conformance with Agency and Underwriting Guidelines. As of the
Securitization Closing Date, the Mortgage Loan was underwritten in accordance
with the Underwriting Guidelines (a copy of which is attached to the related
Assignment and Conveyance Agreement as Exhibit C). The Mortgage Note and
Mortgage are on forms acceptable to Xxxxxxx Mac or Xxxxxx Mae and no
representations have been made to a Mortgagor that are inconsistent with the
mortgage instruments used;
(w) Occupancy of the Mortgaged Property. As of the Closing Date and to
the Company's knowledge as of the Securitization Closing Date, the Mortgaged
Property is lawfully occupied under applicable law. As of the Closing Date, 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. The Company has not received notification from any
Governmental Authority that the Mortgaged Property is in material non-compliance
with such laws or regulations, is being used, operated or occupied unlawfully or
has failed to have or obtain such inspection, licenses or certificates, as the
case may be. The Company has not received notice of any violation or failure to
conform with any such law, ordinance, regulation, standard, license or
certificate. Except as set forth on the Mortgage Loan Schedule, the Mortgagor
represented at the time of origination of the Mortgage Loan that the Mortgagor
would occupy the Mortgaged Property as the Mortgagor's primary residence;
(x) No Additional Collateral. The Mortgage Note is not and has not
been secured by any collateral except the lien of the corresponding Mortgage and
the security interest of any applicable security agreement or chattel mortgage
referred to in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and duly qualified under applicable law to serve as
such, has been properly designated and currently so serves and is named in the
Mortgage (or in the case of a substitution of trustee, is named in a properly
recorded substitution of trustee), and no fees or expenses are or will become
payable by the Purchaser, the Custodian or the Interim Servicer to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor;
(z) Acceptable Investment. As of the Closing Date, there are no
circumstances or conditions with respect to the Mortgage, the Mortgaged
Property, the
Mortgagor, the Mortgage File or the Mortgagor's credit standing that can
reasonably be expected to cause private institutional investors to regard the
Mortgage Loan as an unacceptable investment, cause the Mortgage Loan to become
delinquent, or adversely affect the value or marketability of the Mortgage Loan,
or cause the Mortgage Loan to prepay during any period materially faster or
slower than the mortgage loans originated by the loan Originator generally;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the Mortgage,
the Assignment of Mortgage and any other documents required to be delivered
under this Agreement for each Mortgage Loan have been delivered to the
Custodian. The Company or the Interim Servicer is in possession of a complete,
true and accurate Mortgage File in compliance with Exhibit A hereto, except for
such documents the originals of which have been delivered to the Custodian, and
the Company has retained copies thereof;
(bb) Condominiums/Planned Unit Developments. As of the Securitization
Closing Date, 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 is (i) acceptable to Xxxxxx Xxx or Xxxxxxx
Mac or (ii) located in a condominium or planned unit development project which
has received project approval from Xxxxxx Mae or Xxxxxxx Mac. The
representations and warranties required by Xxxxxx Mae with respect to such
condominium or planned unit development have been satisfied and remain true and
correct;
(cc) Transfer of Mortgage Loans. Except with respect to MERS
Designated Mortgage Loans, the Assignment of Mortgage with respect to each
Mortgage Loan is in recordable form and is acceptable for recording under the
laws of the jurisdiction in which the Mortgaged Property is located. The
transfer, assignment and conveyance of the Mortgage Notes and the Mortgages by
the Company are not subject to the bulk transfer or similar statutory provisions
in effect in any applicable jurisdiction;
(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision for the acceleration of the payment
of the unpaid principal balance of the Mortgage Loan in the event that the
Mortgaged Property is sold or transferred without the prior written consent of
the mortgagee thereunder;
(ee) No Balloon Mortgage Loans. The Mortgage Loan is not a Balloon
Mortgage Loan unless specifically listed on the related Mortgage Loan Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to which
Monthly Payments are paid or partially paid with funds deposited in any separate
account established by the Company, the Mortgagor, or anyone on behalf of the
Mortgagor, or paid by any source other than the Mortgagor nor does it contain
any other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan, and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature. The
indebtedness evidenced by the Mortgage Note is not convertible to an ownership
interest in the Mortgaged Property or the Mortgagor and the Company has not
financed nor does it own directly or indirectly, any equity of any form in the
Mortgaged Property or the Mortgagor;
(gg) Consolidation of Future Advances. Any future advances made to the
Mortgagor prior to the applicable Cut-off Date were consolidated with the
outstanding principal amount secured by the Mortgage, and the secured principal
amount, as consolidated, bears a single interest rate and single repayment term.
The lien of the Mortgage securing the consolidated principal amount is expressly
insured as having first or second, as applicable, lien priority by a title
insurance policy, an endorsement to the policy insuring the mortgagee's
consolidated interest or by other title evidence acceptable to Xxxxxx Xxx and
Xxxxxxx Mac. The consolidated principal amount does not exceed the original
principal amount of the Mortgage Loan;
(hh) Mortgaged Property Undamaged; No Condemnation Proceedings. To the
Company's knowledge, no proceeding pending or threatened for the total or
partial condemnation of the Mortgaged Property. To the Company's knowledge, the
Mortgaged Property is undamaged by waste, 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 and each Mortgaged Property is in good repair;
(ii) Collection Practices; Escrow Deposits; Interest Rate Adjustments.
The origination, servicing and collection practices with respect to the Mortgage
Loan have been in all respects in compliance with Accepted Servicing Practices,
applicable laws and regulations, and have been in all respects legal and proper.
With respect to escrow deposits and Escrow Payments (other than with respect to
Second Lien Loans for which the mortgagee under the prior mortgage lien is
collecting Escrow Payments), all such payments are in the possession of Company
and there exist no deficiencies in connection therewith for which customary
arrangements for repayment thereof have not been made. Each Mortgage Loan is
covered by a paid in full, life of loan, tax service contract that will be
assigned without penalty, premium or cost to the Purchaser or its designee. All
Escrow Payments have been collected in full compliance with state and federal
law and the provisions of the related Mortgage Note and Mortgage. An escrow of
funds is not prohibited by applicable law and has been established in an amount
sufficient 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 or
the Mortgage Note. All Mortgage Interest Rate adjustments have been made in
strict compliance with state and federal law and the terms of the related
Mortgage and Mortgage Note on the related Interest Rate Adjustment Date. If,
pursuant to the terms of the Mortgage Note, another index was selected for
determining the Mortgage Interest Rate, the same index was used with respect to
each Mortgage Note which required a new index to be selected, and such selection
did not conflict with the terms of the related Mortgage Note. Any and all
notices required under applicable law and the terms of the related Mortgage Note
and Mortgage regarding the Mortgage Interest Rate and the Monthly Payment
adjustments have been delivered. Any interest required to be paid pursuant to
state, federal and local law has been properly paid and credited;
(jj) Other Insurance Policies; No Defense to Coverage. As of the
Transfer Date, and to the best of the Company's knowledge, as of the
Securitization Closing Date, no action, inaction or event has occurred and no
state of facts exists or has existed on or prior to the Closing Date that has
resulted or will result in the exclusion from, denial of, or defense to
coverage under any applicable primary mortgage insurance policy, hazard
insurance policy or bankruptcy bond (including, without limitation, any
exclusions, denials or defenses which would limit or reduce the availability of
the timely payment of the full amount of the loss otherwise due thereunder to
the insured), irrespective of the cause of such failure of coverage. The Company
has caused or will cause to be performed any and all acts required to preserve
the rights and remedies of the Purchaser in any insurance policies applicable to
the Mortgage Loans including, without limitation, any necessary notifications of
insurers, assignments of policies or interests therein, and establishments of
coinsured, joint loss payee and mortgagee rights in favor of the Purchaser. In
connection with the placement of any such insurance, no commission, fee, or
other compensation has been or will be received by the Company or by any
officer, director, or employee of the Company or any designee of the Company or
any corporation in which the Company or any officer, director, or employee had a
financial interest at the time of placement of such insurance;
(kk) No Violation of Environmental Laws. The Mortgaged Property is
free from any and all toxic or hazardous substances and there exists no
violation of any local, state or federal environmental law, rule or regulation.
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; 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;
(ll) Servicemembers' Civil Relief Act. The Mortgagor has not notified
the Company, and as of the Securitization Closing Date, the Company has no
knowledge of any relief requested or allowed to the Mortgagor under the
Servicemembers' Civil Relief Act of 2003, as amended, or any similar state
statute;
(mm) Appraisal. As of the Securitization Closing Date, the Company has
delivered to the Purchaser an appraisal of the Mortgaged Property signed prior
to the approval of the Mortgage application by an appraiser qualified under
Xxxxxx Xxx and Xxxxxxx Mac guidelines who (i) is licensed in the state where the
Mortgaged Property is located, (ii) has no interest, direct or indirect, in the
Mortgaged Property or in any loan or the security therefor, and (iii) does not
receive compensation that is affected by the approval or disapproval of the
Mortgage Loan. The appraisal shall have been made within one hundred eighty
(180) days of the origination of the Mortgage Loan and shall be completed in
compliance with the Uniform Standards of Professional Appraisal Practice, and
all applicable Federal and state laws and regulations. If the appraisal was made
more than one hundred twenty (120) days before the origination of the Mortgage
Loan, the Company shall have received and delivered to the Purchaser a
recertification of the appraisal;
(nn) Disclosure Materials. As of the Securitization Closing Date, the
Mortgagor has, to the extent required by applicable law, executed a statement to
the effect that the Mortgagor has, received all disclosure materials required by
applicable law and the Originator has complied with all applicable law with
respect to the making of the Mortgage Loans. The Company shall cause the Interim
Servicer to maintain such statement in the Mortgage File;
(oo) Construction or Rehabilitation of Mortgaged Property. As of the
Securitization Closing Date, the Mortgage Loan was not made in connection with
the construction or rehabilitation of a Mortgaged Property or facilitating the
trade-in or exchange of a Mortgaged Property;
(pp) No Defense to Insurance Coverage. To the best of the Company's
knowledge, no action has been taken or failed to be taken, no event has occurred
and no state of facts exists or has existed on or prior to the Closing Date
(whether or not known to the Company on or prior to such date) which has
resulted or will result in an exclusion from, denial of, or defense to coverage
under any primary mortgage insurance (including, without limitation, any
exclusions, denials or defenses which would limit or reduce the availability of
the timely payment of the full amount of the loss otherwise due thereunder to
the insured) whether arising out of actions, representations, errors, omissions,
negligence, or fraud of the Originator or Company, the related Mortgagor or any
party involved in the application for such coverage, including the appraisal,
plans and specifications and other exhibits or documents submitted therewith to
the insurer under such insurance policy, or for any other reason under such
coverage, but not including the failure of such insurer to pay by reason of such
insurer's breach of such insurance policy or such insurer's financial inability
to pay. In connection with the placement of any such insurance, no commission,
fee, or other compensation has been or will be received by the Originator or
Company or any designee of the Originator or Company or any corporation in which
the Originator or Company or any officer, director, or employee had a financial
interest at the time of placement of such insurance;
(qq) Qualified Mortgage. The Mortgage Loan is a qualified mortgage
under Section 860G(a)(3) of the Code;
(rr) Credit Information. As to each consumer report (as defined in the
Fair Credit Reporting Act, Public Law 91-508) or other credit information
furnished by the Company to the Purchaser, that Company has full right and
authority and is not precluded by law or contract from furnishing such
information to the Purchaser and the Purchaser is not precluded by the terms of
the Mortgage Loan Documents from furnishing the same to any subsequent or
prospective purchaser of such Mortgage. The Interim Servicer has, for each
Mortgage Loan, 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. This representation is a Deemed Material Breach Representation;
(ss) Leaseholds. If the Mortgage Loan is secured by a long-term
residential lease, (1) the lessor under the lease holds a fee simple interest in
the land; (2) the terms of such lease expressly permit the mortgaging of the
leasehold estate, the assignment of the lease without the lessor's consent and
the acquisition by the holder of the Mortgage of the rights of the lessee upon
foreclosure or assignment in lieu of foreclosure or provide the holder of the
Mortgage with substantially similar protections; (3) the terms of such lease do
not (a) allow the termination thereof upon the lessee's default without the
holder of the Mortgage being entitled to receive written notice of, and
opportunity to cure, such default, (b) allow the termination of the lease in the
event of damage or destruction as long as the Mortgage is in existence, (c)
prohibit the holder
of the Mortgage from being insured (or receiving proceeds of insurance) under
the hazard insurance policy or policies relating to the Mortgaged Property or
(d) permit any increase in rent other than pre-established increases set forth
in the lease; (4) the original term of such lease is not less than fifteen (15)
years; (5) the term of such lease does not terminate earlier than five (5) years
after the maturity date of the Mortgage Note; and (6) the Mortgaged Property is
located in a jurisdiction in which the use of leasehold estates in transferring
ownership in residential properties is a widely accepted practice;
(tt) Prepayment Penalty. The Mortgage Loan is subject to a prepayment
penalty as provided in the related Mortgage Note except as set forth on the
related Mortgage Loan Schedule. With respect to each Mortgage Loan that has a
prepayment penalty feature, each such Prepayment Penalty is enforceable and each
prepayment penalty is permitted pursuant to federal, state and local law. Each
such prepayment penalty is in an amount equal to the maximum amount permitted
under applicable law and no such prepayment penalty may provide for a term in
excess of five (5) years with respect to Mortgage Loans originated prior to
October, 1, 2002. With respect to Mortgage Loans originated on or after October
1, 2002, the duration of the prepayment penalty period shall not exceed three
(3) years from the date of the Mortgage Loan unless the Mortgage Loan was
modified to reduce the prepayment penalty period to no more than three (3) years
from the date of such Mortgage Note and the Mortgagor was notified in writing of
such reduction in the prepayment penalty period. With respect to any Mortgage
Loan that contains a provision permitting imposition of a penalty upon a
prepayment prior to maturity: (i) the Mortgage Loan provides some benefit to the
Mortgagor (e.g., a rate or fee reduction) in exchange for accepting such
prepayment penalty, (ii) the Mortgage Loan's originator had a written policy of
offering the Mortgagor or requiring third-party brokers to offer the Mortgagor,
the option of obtaining a mortgage loan that did not require payment of such a
penalty and (iii) the prepayment penalty was adequately disclosed to the
Mortgagor in the mortgage loan documents pursuant to applicable state, local and
federal law. This representation is a Deemed Material Breach Representation;
(uu) Assumability. With respect to each Adjustable Rate Mortgage Loan,
the Mortgage Loan Documents provide that after the related first Interest Rate
Adjustment Date, a related Mortgage Loan may only be assumed if the party
assuming such Mortgage Loan meets certain credit requirements stated in the
Mortgage Loan Documents;
(vv) Conversion to Fixed Interest Rate. With respect to Adjustable
Rate Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;
(ww) Escrow Analysis. With respect to each Mortgage, the Interim
Servicer has within the last twelve (12) months (unless such Mortgage was
originated within such twelve-month period) analyzed the required Escrow
Payments for each Mortgage and adjusted the amount of such payments so that,
assuming all required payments are timely made, any deficiency will be
eliminated on or before the first anniversary of such analysis, or any overage
will be refunded to the Mortgagor, in accordance with RESPA and any other
applicable law;
(xx) Predatory Lending Regulations. As of the Securitization Closing
Date, no Mortgage Loan is a High Cost Loan or Covered Loan, as applicable, and
no Mortgage Loan originated on or after October 1, 2002 through March 6, 2003 is
governed by the Georgia Fair
Lending Act. No Mortgage Loan is covered by the Home Ownership and Equity
Protection Act of 1994 and no Mortgage Loan is in violation of any comparable
state or local law. The Mortgaged Property is not located in a jurisdiction
where a breach of this representation with respect to the related Mortgage Loan
may result in additional assignee liability to the Purchaser This representation
is a Deemed Material Breach Representation;
(yy) Single-Premium Credit Life Insurance Policy. As of the
Securitization Closing Date, no Mortgagor was required to purchase any
single-premium credit insurance policy (e.g., life, disability, accident,
unemployment or property insurance policy) or debt cancellation agreement as a
condition of obtaining the extension of credit. As of the Securitization Closing
Date, no Mortgagor obtained a prepaid single-premium credit insurance policy
(e.g., life, disability, accident, unemployment or property insurance policy) in
connection with the origination of the Mortgage Loan. As of the Securitization
Closing Date, no proceeds from any Mortgage Loan were used to purchase single
premium credit insurance policies or debt cancellation agreements as part of the
origination of, or as a condition to closing, such Mortgage Loan. This
representation is a Deemed Material Breach Representation;
(zz) Regarding the Mortgagor. As of the Securitization Closing Date,
the Mortgagor is one or more natural persons and/or trustees for an Illinois
land trust or a trustee under a "living trust" and such "living trust" is in
compliance with Xxxxxx Xxx guidelines for such trusts;
(aaa) Insurance. The Company has caused or will cause to be performed
any and all acts required to preserve the rights and remedies of the Purchaser
in any insurance policies applicable to the Mortgage Loans including, without
limitation, any necessary notifications of insurers, assignments of policies or
interests therein, and establishments of coinsured, joint loss payee and
mortgagee rights in favor of the Purchaser;
(bbb) Simple Interest Mortgage Loans. The Mortgage Loan is not a
simple interest Mortgage Loan;
(ccc) Flood Certification Contract. The Mortgage Loan is covered by a
paid in full, life of loan, transferable flood certification contract that has
been assigned without penalty, cost or premium to the Purchaser;
(ddd) Consent. Either (a) no consent for the Second Lien Loan is
required by the holder of the related first lien or (b) such consent has been
obtained and is contained in the Mortgage File;
(eee) Origination Date. Except as otherwise indicated on the related
Mortgage Loan Schedule, the date of origination of the Mortgage Loan shall be no
earlier than three (3) months prior to the date such Mortgage Loan is first
purchased by the Purchaser;
(fff) Mortgage Submitted for Recordation. The Mortgage either has been
or will promptly be submitted for recordation in the appropriate governmental
recording office of the jurisdiction where the Mortgaged Property is located;
(ggg) Endorsements. The Mortgage Note has been endorsed by the last
endorsee for its own account and not as a fiduciary, trustee, trustor or
beneficiary under a trust agreement;
(hhh) Accuracy of Information. As of the Securitization Closing Date,
all information provided to the Purchaser by the Company with respect to the
Mortgage Loan is accurate in all material respects;
(iii) Mortgagor Bankruptcy. On or prior to the related Closing Date,
the Mortgagor has not filed or will not file a bankruptcy petition or has not
become the subject or will not become the subject of involuntary bankruptcy
proceedings or has not consented to or will not consent to the filing of a
bankruptcy proceeding against it or to a receiver being appointed in respect of
the related Mortgaged Property;
(jjj) No Construction Loans. As of the Securitization Closing Date, no
Mortgage Loan was made in connection with (a) facilitating the trade-in or
exchange of a Mortgaged Property or (b) the construction or rehabilitation of a
Mortgaged Property, unless the Mortgage Loan is a construction-to-permanent
mortgage loan listed on the Mortgage Loan Schedule which has been fully
disbursed, all construction work is complete and a completion certificate has
been issued;
(kkk) No Equity Participation. No document relating to the Mortgage
Loan provides for any contingent or additional interest in the form of
participation in the cash flow of the Mortgaged Property or a sharing in the
appreciation of the value of the Mortgaged Property. The indebtedness evidenced
by the Mortgage Note is not convertible to an ownership interest in the
Mortgaged Property or the Mortgagor and Company has not financed nor does it own
directly or indirectly, any equity of any form in the Mortgaged Property or the
Mortgagor;
(lll) Proceeds of Mortgage Loan. The proceeds of the Mortgage Loan
have not been and shall not be used to satisfy, in whole or in part, any debt
owed or owing by the Mortgagor to Company or any Affiliate or correspondent
thereof unless such debt was originated more than twenty-four (24) months prior
to the origination of such Mortgage Loan unless there is a tangible net benefit
to the related Mortgagor;
(mmm) No Arbitration. As of the Securitization Closing Date, no
Mortgagor with respect to any Mortgage Loan originated on or after August 1,
2004 agreed to submit to arbitration to resolve any dispute arising out of or
relating in any way to the mortgage loan transaction. This representation is a
Deemed Material Breach Representation;
(nnn) Origination Practices/No Steering. As of the Securitization
Closing Date, no Mortgagor was encouraged or required to select a Mortgage Loan
product offered by the Mortgage Loan's originator which is a higher cost product
designed for less creditworthy borrowers, unless at the time of the Mortgage
Loan's origination, such Mortgagor did not qualify taking into account such
facts as, without limitation, the Mortgage Loan's requirements and the
Mortgagor's credit history, income, assets and liabilities and debt-to-income
ratios for a lower-cost credit product then offered by the Mortgage Loan's
originator or any affiliate of the Mortgage Loan's originator. For a Mortgagor
who seeks financing through a Mortgage Loan
originator's higher-priced subprime lending channel, the Mortgagor was directed
towards or offered the Mortgage Loan originator's standard mortgage line if the
Mortgagor was able to qualify for one of the standard products. This
representation and warranty is a Deemed Material Breach Representation;
(ooo) Underwriting Methodology. As of the Securitization Closing Date,
the methodology used in underwriting the extension of credit for each Mortgage
Loan does not rely on the extent of the Mortgagor's equity in the collateral as
the principal determining factor in approving such extension of credit. The
methodology employed objective criteria that related such facts as, without
limitation, the Mortgagor's credit history, income, assets or liabilities, to
the proposed mortgage payment and, based on such methodology, the Mortgage
Loan's originator made a reasonable determination that at the time of
origination the Mortgagor had the ability to make timely payments on the
Mortgage Loan.. Such underwriting methodology confirmed that at the time of
origination (application/approval) the Mortgagor had a reasonable ability to
make timely payments on the Mortgage Loan. This representation and warranty is a
Deemed Material Breach Representation;
(ppp) Points and Fees. As of the Securitization Closing Date, no
Mortgagor was charged "points and fees" (whether or not financed) in an amount
greater than (i) $1,000 or (ii) 5% of the principal amount of such Mortgage
Loan, whichever is greater. For purposes of this representation, "points and
fees" (x) include origination, underwriting, broker and finder fees and charges
paid to the mortgagee or a third party, and (y) exclude bona fide discount
points, fees paid for actual services rendered in connection with the
origination of the Mortgage Loan (such attorneys' fees, notaries fees and fees
paid for property appraisals, credit reports, surveys, title examinations and
extracts, flood and tax certifications and home inspections), the costs of
mortgage insurance or credit-risk price adjustments, the costs of title, hazard
and flood insurance policies, state and local transfer taxes or fees, escrow
deposits for the future payment of taxes and insurance premiums, and other
miscellaneous fees and charges that, in total, do not exceed 0.25% of the
principal amount of such Mortgage Loan. This representation is a Deemed Material
Breach Representation;
(qqq) Fees Charges. As of the Securitization Closing Date, all fees
and charges (including finance charges) and whether or not financed, assessed,
collected or to be collected in connection with the origination and servicing of
each Mortgage Loan has been disclosed in writing to the Mortgagor in accordance
with applicable state and federal law and regulation. This representation is a
Deemed Material Breach Representation; and
(rrr) Second Lien Mortgage Loans. With respect to each Second Lien
Loan: (1) the related First Lien Loan does not permit negative amortization; (2)
where required or customary in the jurisdiction in which the Mortgaged Property
is located, the original lender has filed for record a request for notice of any
action by the related senior lienholder, and the Company has notified such
second lienholder in writing of the existence of the Second Lien Loan and
requested notification of any action to be taken against the Mortgagor by such
senior lienholder; either (a) no consent for the Second Lien Loan is required by
the holder of the related First Lien Loan or (b) such consent has been obtained
and is contained in the related Mortgage File; (3) to the best of Company's
knowledge, the related First Lien Loan is in full force and effect, and there is
no default, lien, breach, violation or event which would permit acceleration
existing under such First Lien Loan or Mortgage Note, and 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 which would
permit acceleration under such First Lien Loan; (4) the related first lien
Mortgage contains a provision which provides for giving notice of default or
breach to the mortgagee under the Mortgage Loan and allows such mortgagee to
cure any default under the related First Lien Mortgage; and (5) the related
Mortgaged Property was the Mortgagor's principal residence at the time of the
origination of such Second Lien Loan. This representation is a Deemed Material
Breach Representation.
(sss) With respect to second lien loans,
(1) No Negative Amortization of Related First Lien Loan. The
related first lien loan does not permit negative amortization;
(2) Request for Notice; No Consent Required. Where required
or customary in the jurisdiction in which the Mortgaged Property
is located, the original lender has filed for record a request
for notice of any action by the related senior lienholder, and
the Company has notified such senior lienholder in writing of the
existence of the Second Lien Loan and requested notification of
any action to be taken against the Mortgagor by such senior
lienholder. Either (a) no consent for the Second Lien loan is
required by the holder of the related first lien loan or (b) such
consent has been obtained and is contained in the related
Mortgage File;
(3) Not Default Under First Lien. To the best of Company's
knowledge, the related first lien loan is in full force and
effect, and there is no default lien, breach, violation or event
which would permit acceleration existing under such first lien
mortgage or mortgage note, and 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
which would permit acceleration under such first lien loan;
(4) Right to Cure First Lien. The related first lien
mortgage contains a provision which provides for giving notice of
default or breach to the mortgagee under the Mortgage Loan and
allows such mortgagee to cure any default under the related first
lien mortgage; and
(5) Principal Residence. The related Mortgaged Property is
the Mortgagor's principal residence.
This representation and warranty is a Deemed Material and Adverse
Representation.
EXECUTION COPY
================================================================================
AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT
----------
IXIS REAL ESTATE CAPITAL INC.,
Purchaser
FUNDING AMERICA MORTGAGE WAREHOUSE TRUST,
Seller
OCWEN LOAN SERVICING, LLC,
Originator and Interim Servicer
----------
Dated as of October 1, 2006
Adjustable-Rate and Fixed-Rate, B/C Residential Mortgage Loans
================================================================================
TABLE OF CONTENTS
Page
----
SECTION 1. DEFINITIONS............................................ 1
SECTION 2. AGREEMENT TO PURCHASE.................................. 13
SECTION 3. MORTGAGE SCHEDULES..................................... 14
SECTION 4. PURCHASE PRICE......................................... 14
SECTION 5. EXAMINATION OF MORTGAGE FILES.......................... 15
SECTION 6. CONVEYANCE FROM SELLER TO PURCHASER.................... 15
Subsection 6.01. Conveyance of Mortgage Loans; Possession
of Servicing Files............................ 15
Subsection 6.02. Books and Records............................. 15
Subsection 6.03. Delivery of Mortgage Loan Documents........... 16
Subsection 6.04. Quality Control Procedures.................... 17
Subsection 6.05. MERS Designated Mortgage Loans................ 17
SECTION 7. SERVICING OF THE MORTGAGE LOANS........................ 18
SECTION 8. REPRESENTATIONS, WARRANTIES AND COVENANTS OF
THE SELLER; REMEDIES FOR BREACH..................... 18
Subsection 8.01. Representations and Warranties
Regarding the Seller....................... 18
Subsection 8.02. Representations and Warranties
Regarding Individual Mortgage Loans........ 22
Subsection 8.03. Remedies for Breach of Representations
and Warranties............................. 38
Subsection 8.04. Repurchase of Mortgage Loans That Prepay
in Full.................................... 40
Subsection 8.05. Repurchase of Mortgage Loans with First
Payment Defaults........................... 40
Subsection 8.06. Purchaser's Right to Review................... 00
-x-
XXXXXXX 0. CLOSING............................................... 41
SECTION 10. CLOSING DOCUMENTS..................................... 42
SECTION 11. COSTS................................................. 44
SECTION 12. COOPERATION OF SELLER WITH A RECONSTITUTION........... 44
SECTION 13. THE ORIGINATOR AND THE SELLER......................... 46
Subsection 13.01. Additional Indemnification by the Originator;
Third Party Claims........................... 46
Subsection 13.02. Merger or Consolidation of the Seller........ 47
SECTION 14. MANDATORY DELIVERY; GRANT OF SECURITY INTEREST........ 47
SECTION 15. NOTICES............................................... 48
SECTION 16. SEVERABILITY CLAUSE................................... 49
SECTION 17. COUNTERPARTS.......................................... 49
SECTION 18. GOVERNING LAW JURISDICTION; CONSENT TO SERVICE OF
PROCESS............................................ 49
SECTION 19. INTENTION OF THE PARTIES.............................. 49
SECTION 20. SUCCESSORS AND ASSIGNS; ASSIGNMENT OF PURCHASE
AGREEMENT.......................................... 50
SECTION 21. WAIVERS............................................... 50
SECTION 22. EXHIBITS.............................................. 50
SECTION 23. GENERAL INTERPRETIVE PRINCIPLES....................... 50
SECTION 24. REPRODUCTION OF DOCUMENTS............................. 51
SECTION 25. FURTHER AGREEMENTS.................................... 51
SECTION 26. RECORDATION OF ASSIGNMENTS OF MORTGAGE................ 51
-ii-
SECTION 27. NO SOLICITATION....................................... 51
SECTION 28. WAIVER OF TRIAL BY JURY............................... 52
SECTION 29. COMPLIANCE WITH REGULATION AB......................... 52
Subsection 29.01. Intent of the Parties; Reasonableness........ 52
Subsection 29.02. Additional Representations and Warranties of
the Seller................................... 53
Subsection 29.03. Information to Be Provided by the Seller..... 53
Subsection 29.04. Indemnification; Remedies.................... 56
SECTION 30. NO RECOURSE TO THE SELLER............................. 57
-iii-
EXHIBITS
EXHIBIT A CONTENTS OF EACH MORTGAGE FILE
EXHIBIT B FORM OF INTERIM SERVICING AGREEMENT
EXHIBIT C FORM OF OFFICER'S CERTIFICATE
EXHIBIT D FORM OF OPINION OF COUNSEL TO THE GUARANTOR, THE SELLER AND THE
INTERIM SERVICER
EXHIBIT E FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT F FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT G [RESERVED]
EXHIBIT H FORM OF ASSIGNMENT AND CONVEYANCE AGREEMENT
EXHIBIT I FUNDING AMERICA'S UNDERWRITING GUIDELINES
EXHIBIT J FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
EXHIBIT K FORM OF INDEMNIFICATION AND CONTRIBUTION AGREEMENT
-iv-
AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT
This AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND WARRANTIES
AGREEMENT (the "Agreement"), dated as of October 1, 2006, by and among IXIS Real
Estate Capital Inc., a New York corporation, having an office at 0 Xxxx 00xx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Purchaser"), Funding America
Mortgage Warehouse Trust, a Delaware statutory trust, having an office at 000
Xxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxxx 00000 (the "Seller") and Ocwen
Loan Servicing, LLC, a Delaware limited liability company, having an office at
0000 Xxxxxxxxxxx Xxxx, Xxxxxxxxxx Xxxx, Xxxxx 000, Xxxx Xxxx Xxxxx, Xxxxxxx
00000 (the "Interim Servicer").
WITNESSETH:
WHEREAS, the Seller desires to sell, from time to time, to the
Purchaser, and the Purchaser desires to purchase, from time to time, from the
Seller, certain first and second lien, adjustable-rate and fixed-rate B/C
residential mortgage loans (the "Mortgage Loans") on a servicing released basis
as described herein, and which shall be delivered in pools of whole loans (each,
a "Mortgage Loan Package") on various dates as provided herein (each, a "Closing
Date");
WHEREAS, the Purchaser and Seller are parties to that certain Mortgage
Loan Purchase and Warranties Agreement, dated as of May 1, 2006 (the "Original
Purchase Agreement"); and
WHEREAS, as the present time, the Purchase and the Seller desire to
amend the Original Purchase Agreement to make certain modifications as set forth
herein.
NOW, THEREFORE, in consideration of the premises and mutual agreements
set forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Purchaser and the Seller agree
as follows:
SECTION 1. Definitions.
For purposes of this Agreement the following capitalized terms shall
have the respective meanings set forth below.
Accepted Servicing Practices: With respect to any Mortgage Loan, those
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.
Act: The National Housing Act, as amended from time to time.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan
purchased pursuant to this Agreement.
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agency Transfer: A Xxxxxx Xxx Transfer or a Xxxxxxx Mac Transfer.
Agreement: This Amended and Restated Mortgage Loan Purchase and
Warranties Agreement and all amendments hereof and supplements hereto.
ALTA: The American Land Title Association and its successors in
interest.
Appraised Value: (i) With respect to any First Lien Loan, the value of
the related Mortgaged Property based upon the appraisal made, if any, for the
originator at the time of origination of the Mortgage Loan or the sales price of
the Mortgaged Property at such time of origination, whichever is less; provided,
however, that in the case of a refinanced Mortgage Loan, such value is based
solely upon the appraisal made, if any, at the time of origination of such
refinanced Mortgage Loan, and (ii) with respect to any Second Lien Loan, the
value, determined pursuant to Funding America's Underwriting Guidelines, of the
related Mortgaged Property as of the origination of the Second Lien Loan.
Assignment and Conveyance Agreement: As defined in Subsection 6.01.
Assignment of Mortgage: 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.
Balloon Mortgage Loan: Any Mortgage Loan that requires only payments
of interest until the stated maturity date of the Mortgage Loan or the Monthly
Payments of principal which (not including the payment due on its stated
maturity date) are based on an amortization schedule that would be insufficient
to fully amortize the principal thereof by stated maturity date of the Mortgage
Loan.
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 State of New
York, or the State of Florida, or the state in which the Interim Servicer's
servicing operations are located, are authorized or obligated by law or
executive order to be closed.
Closing Date: The date or dates on which the Purchaser from time to
time shall purchase and the Seller from time to time shall sell the Mortgage
Loans listed on the related Mortgage Loan Schedule with respect to the related
Mortgage Loan Package.
CLTV: As of any date and as to (1) any Second Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal
balance of the Second Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are senior or equal in
priority to the Second Lien Loan and which are secured by the same
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Mortgaged Property to (b) the Appraised Value and (2) any First Lien Loan, the
ratio, expressed as a percentage, of the (a) sum of (i) the outstanding
principal balance of the First Lien Loan and (ii) the outstanding principal
balance as of such date of any mortgage loan or mortgage loans that are junior
or equal in priority to the First Lien Loan and which are secured by the same
Mortgaged Property to (b) the Appraised Value.
Code: Internal Revenue Code of 1986, as amended.
Commission: The United States Securities and Exchange Commission.
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.
Convertible Mortgage Loan: Any individual Adjustable Rate Mortgage
Loan purchased pursuant to this Agreement which contains a provision whereby the
Mortgagor is permitted to convert the Adjustable Rate Mortgage Loan to a Fixed
Rate Mortgage Loan in accordance with the terms of the related Mortgage Note.
Covered Loan: A Mortgage Loan categorized as Covered pursuant to
Appendix E of Standard & Poor's Glossary.
Credit Files: As defined in Section 5 herein.
Custodial Account: The separate account or accounts created and
maintained pursuant to Section 2.04 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Custodial Agreement: The agreement governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other
Mortgage Loan Documents, to be executed between the Purchaser and the Custodian
and to be dated as of the related Cut-Off Date.
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 therein provided. If at any time there is no Custodial
Agreement in effect with respect to a Mortgage Loan, all references to the
Custodian herein and in the Interim Servicing Agreement shall be deemed to refer
to the Purchaser (or its designee) with respect to such Mortgage Loan.
Cut-off Date: The date or dates designated as such on the related
Mortgage Loan Schedule with respect to the related Mortgage Loan Package.
Deemed Material Breach Representation: Each representation identified
as such in Subsection 8.02.
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Deleted Mortgage Loan: A Mortgage Loan that is repurchased or replaced
or to be replaced with a Qualified Substitute Mortgage Loan by the Seller in
accordance with the terms of this Agreement.
Depositor: The depositor, as such term is defined in Regulation AB,
with respect to any Securitization Transaction.
Determination Date: The date specified in the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim period, as
specified therein).
Due Date: The day of the month on which the Monthly Payment is due on
a Mortgage Loan, exclusive of any days of grace.
Eligible Account: Any of (i) an account maintained with a federal or
state chartered depository institution or trust company the short-term unsecured
debt obligations of which (or, in the case of a depository institution or trust
company 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 or
Prime-1 by Xxxxx'x (or a comparable rating if another Rating Agency is specified
by the Purchaser by written notice to the Seller) at the time any amounts are
held on deposit therein, (ii) an account or accounts the deposits in which are
fully insured by the FDIC, or (iii) a trust account or accounts maintained with
a federal or state chartered depository institution or trust company acting in
its fiduciary capacity.
Escrow Account: The separate account or accounts created and
maintained pursuant to Section 2.06 of the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
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 document.
Exchange Act. The Securities Exchange Act of 1934, as amended.
Xxxxxx Mae: The Federal National Mortgage Association and its
successors in interest.
Xxxxxx Xxx Guides: The Xxxxxx Xxx Xxxxxxx' Guide and the Xxxxxx Xxx
Servicers' Guide and all amendments or additions thereto.
Xxxxxx Mae Transfer: As defined in Section 12 hereof.
FDIC: The Federal Deposit Insurance Corporation and its successors in
interest.
FHA: The Federal Housing Administration, an agency within the United
States Department of Housing and Urban Development and its successors in
interest and including the
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Federal Housing Commissioner and the Secretary of Housing and Urban Development
where appropriate under the FHA Regulations.
First Lien Loan: Any Mortgage Loan secured by a first lien Mortgage on
the related Mortgaged Property.
Fitch: Fitch, Inc. and its successors in interest.
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 in interest.
Xxxxxxx Mac Transfer: As defined in Section 12 hereof.
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.
Guarantee: The guarantee, to be dated as of the initial Closing Date,
pursuant to which the obligations of the Seller under the related Purchase Price
and Terms Agreement and the Purchase Agreement will be guaranteed by the
Guarantor in favor of the Purchaser.
Guarantor: Ocwen Financial Corporation, a Florida corporation, and its
successors in interest.
High Cost Loan: A Mortgage Loan (a) covered by the Home Ownership and
Equity Protection Act of 1994 ("HOEPA"), (b) with an "annual percentage rate" or
total "points and fees" payable by the related Mortgagor (as each such term is
calculated under HOEPA) that exceed the thresholds set forth by HOEPA and its
implementing regulations, including 12 C.F.R. Section 226.32(a)(1)(i) and (ii),
(c) classified as a "high cost home," "threshold," "covered," "high risk home,"
"predatory" or similar loan under any other applicable state, federal or local
law (or a similarly classified loan using different terminology under a law
imposing heightened regulatory scrutiny or additional legal liability for
residential mortgage loans having high interest rates, points and/or fees) or
(d) categorized as High Cost pursuant to Appendix E of Standard & Poor's
Glossary. For avoidance of doubt, the parties agree that this definition shall
apply to any law regardless of whether such law is presently, or in the future
becomes, the subject of judicial review or litigation.
Home Loan: A Mortgage Loan categorized as Home Loan pursuant to
Appendix E of Standard & Poor's Glossary.
HUD: The Department of Housing and Urban Development, or any federal
agency or official thereof which may from time to time succeed to the functions
thereof with regard to FHA Mortgage Insurance. The term "HUD," for purposes of
this Agreement, is also
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deemed to include subdivisions thereof such as the FHA and Government
National Mortgage Association.
Index: With respect to each Adjustable Rate Mortgage Loan, a rate per
annum set forth on the related Mortgage Loan Schedule attached as Exhibit B to
each related Assignment and Conveyance Agreement.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
Interest Rate Adjustment Date: With respect to each Adjustable Rate
Mortgage Loan, the date, specified in the related Mortgage Note and the related
Mortgage Loan Schedule, on which the Mortgage Interest Rate is adjusted.
Interim Funder: With respect to each MERS Designated Mortgage Loan,
the Person named on the MERS(R) System as the interim funder pursuant to the
MERS Procedures Manual.
Interim Servicer: Ocwen Loan Servicing, LLC, a Delaware limited
liability company, and its successors in interest, and any successor interim
servicer under the Interim Servicing Agreement.
Interim Servicing Agreement: The agreement, attached as Exhibit B
hereto, to be entered into by the Purchaser and the Interim Servicer, providing
for the Interim Servicer to service the Mortgage Loans for an interim period as
specified by the Interim Servicing Agreement.
Investor: With respect to each MERS Designated Mortgage Loan, the
Person named on the MERS(R) System as the investor pursuant to the MERS
Procedures Manual.
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 related Mortgage Loan Schedule.
Liquidation Proceeds: Cash 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 or otherwise, or the sale of the
related Mortgaged Property if the Mortgaged Property is acquired in satisfaction
of the Mortgage Loan.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan, the
ratio (expressed as a percentage) of the outstanding principal amount of the
Mortgage Loan as of the Cut-off Date (unless otherwise indicated), to the
Appraised Value of the Mortgaged Property.
MERS: Mortgage Electronic Registration Systems, Inc., a Delaware
corporation, and its successors and assigns.
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MERS Designated Mortgage Loan: Mortgage Loans for which (a) the Seller
has designated or will designate MERS as, and has taken or will take such action
as is necessary to cause MERS to be, the mortgagee of record, as nominee for the
Seller, in accordance with MERS Procedure Manual and (b) the Seller has
designated or will designate the Purchaser as the Investor on the MERS(R)
System.
MERS Procedure Manual: The MERS Procedures Manual, as it may be
amended, supplemented or otherwise modified from time to time.
MERS Report: The report from the MERS System listing MERS Designated
Mortgage Loans and other information.
MERS(R) System: MERS mortgage electronic registry system, as more
particularly described in the MERS Procedures Manual.
Monthly Payment: The scheduled monthly payment of principal and
interest on a Mortgage Loan.
Moody's: Xxxxx'x Investors Service, Inc. and its successors in
interest.
Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note, which creates a first lien, in the case of a First Lien Loan, or
a second lien, in the case of a Second Lien Loan, on the Mortgaged Property.
Mortgage File: The items pertaining to a particular Mortgage Loan
referred to in Exhibit A 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 with respect to each Mortgage Loan.
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 applicable Mortgage Loan Schedule, which Mortgage Loan
includes without limitation the Mortgage File, the Monthly Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
Servicing Rights, and all other rights, benefits, proceeds and obligations
arising from or in connection with such Mortgage Loan, excluding replaced or
repurchased mortgage loans.
Mortgage Loan Documents: The documents required to be delivered to the
Custodian pursuant to Subsection 6.03 hereof with respect to any Mortgage Loan.
Mortgage Loan Package: Each pool of Mortgage Loans, which shall be
purchased by the Purchaser from the Seller from time to time on the related
Closing Date.
Mortgage Loan Schedule: The schedule of Mortgage Loans setting forth
the following information with respect to each Mortgage Loan in the related
Mortgage Loan Package: (1) the Seller's Mortgage Loan identifying number; (2)
the Mortgagor's name; (3) the
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street address of the Mortgaged Property including the city, state and zip code;
(4) a code indicating whether the Mortgaged Property is owner-occupied, a second
home or investment property; (5) the number and type of residential units
constituting the Mortgaged Property (i.e., a single family residence, a 2-4
family residence, a unit in a condominium project or a unit in a planned unit
development, manufactured housing); (6) the Mortgage Loan origination date; (7)
the original months to maturity or the remaining months to maturity from the
related Cut-off Date, in any case based on the original amortization schedule
and, if different, the maturity expressed in the same manner but based on the
actual amortization schedule; (8) the Loan-to-Value Ratio at origination; (9)
with respect to First Lien Loans, the LTV and with respect to Second Lien Loans,
the CLTV; (10) the Mortgage Interest Rate as of the related Cut-off Date; (11)
the date on which the Monthly Payment was due on the Mortgage Loan and, if such
date is not consistent with the Due Date currently in effect, such Due Date;
(12) the stated maturity date; (13) the amount of the Monthly Payment as of the
related Cut-off Date; (14) the last payment date as of which a payment was
actually applied to the outstanding principal balance; (15) the original
principal amount of the Mortgage Loan; (16) the principal balance of the
Mortgage Loan as of the close of business on the related Cut-off Date, after
deduction of payments of principal due and collected on or before the Cut-off
Date; (17) the Interest Rate Adjustment Date; (18) the Gross Margin; (19) the
Lifetime Rate Cap under the terms of the Mortgage Note; (20) a code indicating
the type of Index; (21) the Mortgage Interest Rate as of origination; (22) the
type of Mortgage Loan (i.e., fixed-rate, adjustable-rate, First Lien, Second
Lien); (23) a code indicating the purpose of the loan (i.e., purchase, rate and
term refinance, equity take-out refinance); (24) a code indicating the
documentation style (i.e., full or stated income); (25) the loan credit
classification (as described in the Underwriting Guidelines); (26) the
applicable Cut-off Date; (27) the applicable Closing Date; (28) a code
indicating whether the Mortgage Loan is a Home Loan; (29) the credit risk score
(FICO score); (30) with respect to the related Mortgagor, the debt-to-income
ratio; (31) with respect to Second Lien Loans, the outstanding principal balance
of the superior lien; (32) the Appraised Value of the Mortgaged Property; (33)
the sale price of the Mortgaged Property if the Mortgage Loan was originated in
connection with the purchase of the Mortgaged Property; (34) the Periodic Rate
Cap under the terms of the Mortgage Note; (35) the Periodic Rate Floor under the
terms of the Mortgage Note; (36) whether such Mortgage Loan provides for a
prepayment penalty; (37) the prepayment penalty period of such Mortgage Loan, if
applicable; (38) a description of the type of prepayment penalty, if applicable;
(39) the MERS Identification Number; (40) whether the Mortgagor represented that
the Mortgagor would occupy the Mortgaged Property as its primary residence, (41)
in connection with a condominium unit, a code indicating whether the condominium
project where such unit is located is low-rise or high-rise and (42) a code
indicating if the Mortgage Loan is a Balloon Mortgage Loan. With respect to the
Mortgage Loans in the aggregate, the Mortgage Loan Schedule shall set forth the
following information, as of the related Cut-off Date: (1) the number of
Mortgage Loans; (2) the current aggregate outstanding principal balance of the
Mortgage Loans; (3) the weighted average Mortgage Interest Rate of the Mortgage
Loans; and (4) the weighted average maturity of the Mortgage Loans.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
Mortgaged Property: With respect to each Mortgage Loan, the
Mortgagor's real property securing repayment of a related Mortgage Note,
consisting of an unsubordinated estate
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in fee simple or, with respect to real property located in jurisdictions in
which the use of leasehold estates for residential properties is a
widely-accepted practice, a leasehold estate, in a single parcel or multiple
parcels of real property improved by a residential dwelling as further described
in this Agreement.
Mortgagor: The obligor on a Mortgage Note.
OCC: Office of the Comptroller of the Currency and its successors in
interest.
Officer's Certificate: A certificate signed by the Chairman of the
Board or the Vice Chairman of the Board or a President or a Vice President and
by the Treasurer or the Secretary or one of the Assistant Treasurers or
Assistant Secretaries of the Seller, and delivered to the Purchaser as required
by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel
for the Seller, reasonably acceptable to the Purchaser, provided that any
Opinion of Counsel relating to (a) the qualification of any account required to
be maintained pursuant to this Agreement as an Eligible Account, (b)
qualification of the Mortgage Loans in a REMIC or (c) compliance with the REMIC
Provisions, must be (unless otherwise stated in such Opinion of Counsel) an
opinion of counsel who (i) is in fact independent of the Seller and any servicer
of the Mortgage Loans, (ii) does not have any material direct or indirect
financial interest in the Seller or any servicer of the Mortgage Loans or in an
Affiliate of either and (iii) is not connected with the Seller or any servicer
of the Mortgage Loans as an officer, employee, director or person performing
similar functions.
Originator: Ocwen Loan Servicing, LLC, a Delaware limited liability
company, and its successors in interest.
OTS: Office of Thrift Supervision and its successors in interest.
Periodic Rate Cap: 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 increase on an Interest
Rate Adjustment Date above the Mortgage Interest Rate previously in effect.
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.
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.
Preliminary Mortgage Schedule: As defined in Section 3.
Premium Percentage: With respect to any Mortgage Loan, a percentage
equal to the excess of the Purchase Price Percentage over 100%.
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Principal Prepayment: Any payment or other recovery of principal on a
Mortgage Loan 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.
Purchase Price: The price paid on the related Closing Date by the
Purchaser to the Seller in exchange for the Mortgage Loans purchased on such
Closing Date as calculated in Section 4 of this Agreement.
Purchase Price and Terms Agreement: Those certain agreements setting
forth the general terms and conditions of the transaction consummated herein and
identifying the Mortgage Loans to be purchased from time to time hereunder, by
and among the Seller, the Purchaser and the Interim Servicer (if applicable).
All of the individual Purchase Price and Terms Agreements shall collectively be
referred to as the "Purchase Price and Terms Agreement."
Purchase Price Percentage: With respect to any Mortgage Loan, an
amount equal to the percentage of par as stated in the Purchase Price and Terms
Agreement (subject to adjustment as provided therein) related to such Mortgage
Loan.
Purchaser: IXIS Real Estate Capital Inc., a New York corporation, and
its successors in interest and assigns, or any successor to the Purchaser under
this Agreement as herein provided.
Qualified Correspondent: Any Person from which the Seller purchased
Mortgage Loans, provided that the following conditions are satisfied: (i) such
Mortgage Loans were originated pursuant to an agreement between the Seller and
such Person that contemplated that such Person would underwrite mortgage loans
from time to time, for sale to the Seller, in accordance with underwriting
guidelines designated by the Seller ("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 Seller within one hundred eighty (180) days after origination; (iii) either
(x) the Designated Guidelines were, at the time such Mortgage Loans were
originated, used by the Seller in origination of mortgage loans of the same type
as the Mortgage Loans for the Seller's own account or (y) the Designated
Guidelines were, at the time such Mortgage Loans were underwritten, designated
by the Seller on a consistent basis for use by lenders in originating mortgage
loans to be purchased by the Seller; and (iv) the Seller employed, at the time
such Mortgage Loans were acquired by the Seller, pre-purchase or post-purchase
quality assurance procedures (which may involve, among other things, review of a
sample of 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
Seller.
Qualified Substitute Mortgage Loan: A mortgage loan eligible to be
substituted by the Seller for a Deleted Mortgage Loan which must, on the date of
such substitution, (i) have an outstanding principal balance, after deduction of
all scheduled payments due in the month of substitution (or in the case of a
substitution of more than one mortgage loan for a Deleted
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Mortgage Loan, an aggregate principal balance), not in excess of the outstanding
principal balance of the Deleted Mortgage Loan (the amount of any shortfall will
be deposited in the Custodial Account by the Seller in the month of
substitution); (ii) have a Mortgage Interest Rate not less than and not more
than 1% greater than the Mortgage Interest Rate of the Deleted Mortgage Loan;
(iii) have a remaining term to maturity not greater than and not more than one
(1) year less than that of the Deleted Mortgage Loan; (iv) be of the same type
as the Deleted Mortgage Loan (i.e., fixed-rate, adjustable-rate with same
Periodic Rate Cap, Index and lien priority); and (v) comply with each
representation and warranty (respecting individual Mortgage Loans) set forth in
Section 8 hereof.
Rating Agency: Any of Fitch, Moody's or Standard & Poor's, or their
respective successors designated by the Purchaser.
Reconstitution: Any Securitization Transaction or Whole Loan Transfer.
Reconstitution Agreements: The agreement or agreements entered into by
the Seller and/or the Interim Servicer and the Purchaser and/or certain third
parties on the Reconstitution Date or Dates with respect to any or all of the
Mortgage Loans sold hereunder, in connection with a Whole Loan Transfer, Agency
Transfer or a Securitization Transaction pursuant to Section 12, including, but
not limited to, a seller's warranties and servicing agreement with respect to a
Whole Loan Transfer, and a trust and servicing agreement, pooling and servicing
agreement and/or seller/servicer agreements and related custodial/trust
agreement and documents with respect to a Securitization Transaction.
Reconstitution Date: As defined in Section 12.
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. Sections 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 Date: The date specified in the Interim Servicing Agreement
(with respect to each Mortgage Loan, for an interim period, as specified
therein).
Repurchase Price: With respect to any Mortgage Loan for which a breach
of a representation or warranty from the Agreement or the Interim Servicing
Agreement is found, a price equal to the then outstanding principal balance of
the Mortgage Loan to be repurchased, plus accrued interest thereon at the
Mortgage Interest Rate from the date to which interest had
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last been paid through the date of such repurchase, plus the amount of any
outstanding advances owed to any servicer, and plus all costs and expenses
incurred by the Purchaser or any servicer arising out of or based upon such
breach, including without limitation costs and expenses incurred in the
enforcement of the Seller's repurchase obligation hereunder.
RESPA: Real Estate Settlement Procedures Act, as amended from time to
time.
Second Lien Loan: A Mortgage Loan secured by a second lien Mortgage on
the related Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Securitization Transaction. Any transaction involving either (1) 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 (2)
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.
Seller: Funding America Mortgage Warehouse Trust, a Delaware statutory
trust and its successors in interest.
Seller Information: As defined in Subsection 29.04(a).
Servicing Fee: With respect to each Mortgage Loan subject to the
Interim Servicing Agreement, an amount equal to 0.50% per annum computed on the
basis of the outstanding principal balance of the related Mortgage Loan. Such
fee shall be payable monthly and shall be pro rated for any portion of a month
during which the Mortgage Loan is serviced by the Interim Servicer under the
Interim Servicing Agreement. 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 this Agreement) of such Monthly Payment
collected by the Interim Servicer, or as otherwise provided under this
Agreement.
Servicing File: With respect to each Mortgage Loan, the file retained
by the Interim Servicer consisting of originals of all documents in the Mortgage
File which are not delivered to the Purchaser or the Custodian and copies of the
Mortgage Loan Documents.
Servicing Rights: Any and all of the following: (a) any and all rights
to service the Mortgage Loans; (b) any payments to or monies received by the
Interim Servicer for servicing the Mortgage Loans; (c) any late fees, penalties
or similar payments with respect to the Mortgage Loans; (d) all agreements or
documents creating, defining or evidencing any such servicing rights to the
extent they relate to such servicing rights and all rights of the Interim
Servicer thereunder; (e) Escrow Payments or other similar payments with respect
to the Mortgage Loans and any amounts actually collected by the Interim Servicer
with respect thereto; (f) all accounts and other rights to payment related to
any of the property described in this paragraph; and (g) any and all documents,
files, records, servicing files, servicing documents,
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servicing records, data tapes, computer records, or other information pertaining
to the Mortgage Loans or pertaining to the past, present or prospective
servicing of the Mortgage Loans.
Sponsor: The sponsor, as such term is defined in Regulation AB, with
respect to any Securitization Transaction.
Standard & Poor's: Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies Inc., and its successors in interest.
Standard & Poor's Glossary: The Standard & Poor's LEVELS(R) Glossary,
as may be in effect from time to time.
Stated Principal Balance: As to each Mortgage Loan on any date of
determination, (i) the principal balance of such Mortgage Loan at the related
Cut-off Date after giving effect to payments of principal due on or before such
date, to the extent actually received, minus (ii) all amounts previously
distributed to the Purchaser with respect to the related Mortgage Loan
representing payments or recoveries of principal on such Mortgage Loan.
Static Pool Information: Static pool information as described in Item
1105(a)(1)-(3) and 1105(c) of Regulation AB.
Successor Servicer: Any servicer of one or more Mortgage Loans
designated by the Purchaser as being entitled to the benefits of the
indemnifications set forth in Subsections 8.03 and 13.01.
Third-Party Originator: Each Person, other than a Qualified
Correspondent, that originated Mortgage Loans acquired by the Seller.
Transfer Date: The date on which the Purchaser, or its designee, shall
receive the transfer of servicing responsibilities and begin to perform the
servicing of the Mortgage Loans with respect to the related Mortgage Loan
Package, and the Interim Servicer shall cease all servicing responsibilities.
Such date shall occur on the day indicated by the Purchaser to the Interim
Servicer in accordance with the Interim Servicing Agreement.
Underwriting Guidelines: The underwriting guidelines of Funding
America, a copy of which is attached hereto as Exhibit I and a then-current copy
of which shall be attached as an Exhibit to the related Assignment and
Conveyance.
VA: The Department of Veterans Affairs, an agency of the United States
of America, or any successor thereto including the Administrator of Veterans
Affairs.
Whole Loan Transfer: Any sale or transfer of some or all of the
Mortgage Loans, other than a Securitization Transaction.
SECTION 2. Agreement to Purchase.
The Seller agrees to sell from time to time, and the Purchaser agrees
to purchase from time to time, Mortgage Loans having an aggregate principal
balance on the related Cut-off
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Date in an amount as set forth in the related Purchase Price and Terms
Agreement, or in such other amount as agreed by the Purchaser and the Seller as
evidenced by the actual aggregate principal balance of the Mortgage Loans
accepted by the Purchaser on each Closing Date. SECTION 3. Mortgage Schedules.
The Seller from time to time shall provide the Purchaser with certain
information constituting a preliminary listing of the Mortgage Loans to be
purchased on each Closing Date in accordance with the related Purchase Price and
Terms Agreement and this Agreement (each, a "Preliminary Mortgage Schedule").
The Seller shall deliver the Mortgage Loan Schedule for the Mortgage
Loans to be purchased on a particular Closing Date to the Purchaser at least
seven (7) Business Days prior to the related Closing Date. The Mortgage Loan
Schedule shall be the related Preliminary Mortgage Schedule with those Mortgage
Loans which the Seller has not funded prior to the related Closing Date deleted.
SECTION 4. Purchase Price.
The Purchase Price for the Mortgage Loans shall be equal to (a) the
Purchase Price Percentage multiplied by the Cut-off Date Balance, plus (b)
accrued and unpaid interest on such principal balance at the weighted average
Mortgage Interest Rate (net of the Servicing Fee) of those Mortgage Loans from
the related Cut-off Date through the day prior to the related Closing Date,
inclusive. For purposes hereof, "Cut-off Date Balance" means the aggregate
principal balance, as of the related Cut-off Date, of the Mortgage Loans listed
on the related Mortgage Loan Schedule, after application of scheduled payments
of principal due on or before the related Cut-off Date, to the extent such
payments were actually received, together with any unscheduled principal
payments collected prior to the Cut-off Date; provided, however, that payments
of scheduled principal and interest paid prior to the Cut-off Date, but to be
applied on a due date beyond the related Cut-off Date, shall not be applied to
the principal balance as of the related Cut-off Date. If so provided in the
related Purchase Price and Terms Agreement, portions of the Mortgage Loans shall
be priced separately. The Purchase Price as so determined shall be paid to the
Seller on the related Closing Date by wire transfer of immediately available
funds to an account designated by the Seller in writing.
The Purchaser shall be entitled to (l) all principal paid after the
related Cut-off Date, (2) all other recoveries of principal collected on or
after the related Cut-off Date, and (3) all payments of interest on the Mortgage
Loans net of applicable Servicing Fees (minus that portion of any such payment
which is allocable to the period prior to the related Cut-off Date). The
outstanding principal balance of each Mortgage Loan as of the related Cut-off
Date is determined after application of payments of principal due on or before
the related Cut-off Date, to the extent actually collected, together with any
unscheduled principal prepayments collected prior to the Cut-off Date; provided,
however, that payments of scheduled principal and interest paid prior to the
Cut-off Date, but to be applied on a due date beyond the related Cut-off Date
shall not be applied to the principal balance as of the related Cut-off Date.
Such prepaid amounts shall be the property of the Purchaser. The Interim
Servicer shall deposit any such prepaid
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amounts into the Custodial Account, which account is established for the benefit
of the Purchaser for subsequent remittance by the Interim Servicer to the
Purchaser.
SECTION 5. Examination of Mortgage Files.
At least ten (10) days prior to the related Closing Date (or such
other date acceptable to the Purchaser and the Seller), the Seller shall (i)
either (a) deliver to the Purchaser or its designee in escrow, for examination
with respect to each Mortgage Loan to be purchased, the related Mortgage File,
including a copy of the Assignment of Mortgage (except with respect to each MERS
Designated Mortgage Loan), pertaining to each Mortgage Loan, or (b) make the
related Mortgage File available to the Purchaser for examination at such other
location as shall otherwise be acceptable to the Purchaser and (ii) deliver to
the Purchaser copies of the credit and servicing files (collectively, the
"Credit Files"). Such examination of the Mortgage Files may be made by the
Purchaser or its designee at any reasonable time before or after the related
Closing Date. If the Purchaser makes such examination prior to the related
Closing Date and determines, in its sole discretion, that any Mortgage Loans are
unacceptable to the Purchaser for any reason, such Mortgage Loans shall be
deleted from the related Mortgage Loan Schedule, and may be replaced by a
Qualified Substitute Mortgage Loan (or Loans) acceptable to the Purchaser. The
Purchaser may, at its option and without notice to the Seller, purchase some or
all of the Mortgage Loans without conducting any partial or complete
examination. The fact that the Purchaser or its designee has conducted or has
failed to conduct any partial or complete examination of the Mortgage Files or
the Credit Files shall not impair in any way the Purchaser's (or any of its
successor's) rights to demand repurchase, substitution or other remedy as
provided in this Agreement. In the event that the Seller fails to deliver the
Credit Files with respect to any Mortgage Loan, the Originator shall, upon the
request of the Purchaser, repurchase such Mortgage Loan at the price and in the
manner specified in Subsection 8.03.
SECTION 6. Conveyance from Seller to Purchaser.
Subsection 6.01. Conveyance of Mortgage Loans; Possession of Servicing
Files.
On each Closing Date, the Seller shall execute and deliver to the
Purchaser an Assignment and Conveyance Agreement in the form attached hereto as
Exhibit H (the "Assignment and Conveyance Agreement"). The Interim Servicer
shall cause the Servicing File retained by the Interim Servicer to be
appropriately identified and its computer system and/or books and records to
clearly reflect the sale of the related Mortgage Loan to the Purchaser. The
Interim Servicer shall release from its custody the contents of any Servicing
File retained by it only in accordance with this Agreement or the Interim
Servicing Agreement, except when such release is required in connection with a
repurchase of any such Mortgage Loan pursuant to Subsection 8.03.
Subsection 6.02. Books and Records.
Record title to each Mortgage as of the related Closing Date shall be
in the name of the Originator, the Purchaser or one or more designees of the
Purchaser, as the Purchaser shall select. Notwithstanding the foregoing, each
Mortgage and related Mortgage Note shall be possessed solely by the Purchaser or
the appropriate designee of the Purchaser, as the case may
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be. All rights arising out of the Mortgage Loans including, but not limited to,
all funds received by the Seller or the Interim Servicer after the related
Cut-off Date on or in connection with a Mortgage Loan shall be vested in the
Purchaser or one or more designees of the Purchaser; provided, however, that all
funds received on or in connection with a Mortgage Loan shall be received and
held by the Seller or the Interim Servicer in trust for the benefit of the
Purchaser or the appropriate designee of the Purchaser, as the case may be, as
the owner of the Mortgage Loans pursuant to the terms of this Agreement.
The sale of each Mortgage Loan shall be reflected on the Seller's
balance sheet and other financial statements as a sale of assets by the Seller.
The Interim Servicer 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 Interim Servicer shall maintain in its possession,
available for inspection by the Purchaser, 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 Xxx or Xxxxxxx Mac, including
but not limited to documentation as to the method used in determining the
applicability of the provisions of the National Flood Insurance Act of 1968, as
amended, to the Mortgaged Property, documentation evidencing insurance coverage
and periodic inspection reports, as required by the Xxxxxx Mae Guides. To the
extent that original documents are not required for purposes of realization of
Liquidation Proceeds or Insurance Proceeds, documents maintained by the Seller
or the Interim Servicer may be in the form of microfilm or microfiche so long as
the Seller or the Interim Servicer complies with the requirements of the Xxxxxx
Xxx Guides.
Subsection 6.03. Delivery of Mortgage Loan Documents.
The Seller shall deliver and release to the Custodian no later than
five (5) days prior to the related Closing Date (or such other date acceptable
to the Purchaser and the Seller) those Mortgage Loan Documents set forth on
Exhibit A hereto with respect to each Mortgage Loan set forth on the related
Mortgage Loan Schedule.
The Custodian shall certify its receipt of all such Mortgage Loan
Documents required to be delivered pursuant to the Custodial Agreement for the
related Closing Date, as evidenced by the Certification and Trust Receipt of the
Custodian in the form annexed to the Custodial Agreement. The Purchaser shall
pay all fees and expenses of the Custodian from and after the Closing Date.
The Interim Servicer shall forward to the Custodian, or to such other
Person as the Purchaser shall designate in writing, original documents
evidencing an assumption, modification, consolidation or extension of any
Mortgage Loan entered into in accordance with this Agreement within two (2)
weeks of their execution, provided, however, that the Interim Servicer shall
provide the Custodian, or to such other Person as the Purchaser shall designate
in writing, with a certified true copy of any such document submitted for
recordation within two (2) weeks of its execution, and shall promptly 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
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complete copy of the original within one hundred and eighty (180) days of its
submission for recordation.
In the event any document required to be delivered to the Custodian
pursuant to the previous paragraph, including an original or copy of any
document submitted for recordation to the appropriate public recording office,
is not so delivered to the Custodian, or to such other Person as the Purchaser
shall designate in writing, within one hundred and eighty (180) days following
the related Closing Date (other than with respect to the Assignments of Mortgage
which shall be delivered to the Custodian in blank and recorded subsequently by
the Purchaser or its designee), and in the event that the Seller does not cure
such failure within thirty (30) days of discovery or receipt of written
notification of such failure from the Purchaser, the related Mortgage Loan
shall, upon the request of the Purchaser, be repurchased by the Originator at
the price and in the manner specified in Subsection 8.03. The foregoing
repurchase obligation shall not apply in the event that the Seller cannot
deliver such original or copy of any document submitted for recordation to the
appropriate public recording office within the specified period due to a delay
caused by the recording office in the applicable jurisdiction, provided that (i)
the Seller shall deliver a recording receipt of such recording office or, if
such recording receipt is not available, an officer's certificate of a servicing
officer of the Seller, confirming that such documents have been accepted for
recording (upon request of the Purchaser and delivery by the Purchaser to the
Seller of a schedule of the related Mortgage Loans, the Seller shall reissue and
deliver to the Purchaser or its designee said officer's certificate relating to
the related Mortgage Loans), and (ii) such document is delivered within twelve
(12) months of the related Closing Date.
The Originator shall pay all initial recording fees, if any, for the
assignments of mortgage and any other fees or costs in transferring all original
documents to the Custodian or, upon written request of the Purchaser, to the
Purchaser or the Purchaser's designee.
Subsection 6.04. Quality Control Procedures.
The Interim Servicer shall have an internal quality control program
that verifies in a manner consistent with accepted industry procedures, on a
regular basis, the existence and accuracy of the legal documents, credit
documents, property appraisals, and underwriting decisions. The program shall
include evaluating and monitoring the overall quality of the Seller's loan
production and the servicing activities of the Interim Servicer. The program is
to ensure that the Mortgage Loans are originated and serviced in accordance with
Accepted Servicing Practices and the Underwriting Guidelines; guard against
dishonest, fraudulent, or negligent acts; and guard against errors and omissions
by officers, employees, or other authorized persons.
Subsection 6.05. MERS Designated Mortgage Loans.
With respect to each MERS Designated Mortgage Loan, the Seller shall,
on or prior to the related Closing Date, designate the Purchaser as the Investor
and the Custodian as custodian, and no Person shall be listed as Interim Funder
on the MERS System. In addition, within five (5) Business Days following the
related Closing Date, the Interim Servicer shall provide the Custodian and the
Purchaser with a MERS Report listing the Purchaser as the
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Investor, the Custodian as custodian and no Person as Interim Funder with
respect to each MERS Designated Mortgage Loan.
SECTION 7. Servicing of the Mortgage Loans.
The Mortgage Loans have been sold by the Seller to the Purchaser on a
servicing released basis. Subject to, and upon the terms and conditions of this
Agreement and the Interim Servicing Agreement (with respect to each Mortgage
Loan, for an interim period, as specified therein), the Seller hereby sells,
transfers, assigns, conveys and delivers to the Purchaser the Servicing Rights.
The Purchaser shall retain the Interim Servicer as contract servicer
of the Mortgage Loans for an interim period pursuant to and in accordance with
the terms and conditions contained in the Interim Servicing Agreement (with
respect to each Mortgage Loan, for an interim period, as specified therein).
Except as set forth in the Interim Servicing Agreement, the Interim Servicer
shall service the Mortgage Loans on an "actual/actual" basis and otherwise in
compliance with the servicing provisions related to the Xxxxxx Mae MBS Program
(Special Servicing Option) of the Xxxxxx Xxx Guides (except as otherwise set
forth in the Interim Servicing Agreement).
Pursuant to the Interim Servicing Agreement (with respect to each
Mortgage Loan, for an interim period, as specified therein), the Interim
Servicer shall begin servicing the Mortgage Loans on behalf of the Purchaser and
shall be entitled to a Servicing Fee with respect to such Mortgage Loans until
the applicable Transfer Date. The Interim Servicer shall conduct such servicing
in accordance with the Interim Servicing Agreement.
SECTION 8. Representations, Warranties and Covenants of the Seller;
Remedies for Breach.
Subsection 8.01. Representations and Warranties Regarding the Seller.
The Seller and the Originator represent, warrant and covenant to the
Purchaser that as of the date hereof and as of each Closing Date:
(a) Due Organization and Authority. The Seller is a statutory trust
duly organized, validly existing and in good standing under the laws of the
state of Delaware, 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 wherein it owns or leases any material properties or 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 Seller,
and in any event the Seller 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 Seller has the full trust power, authority and legal right to
hold, transfer and convey the Mortgage Loans and to execute and deliver this
Agreement and to perform its obligations hereunder; the execution, delivery and
performance of this Agreement (including all instruments of transfer to be
delivered pursuant to this Agreement) by the Seller and the consummation of the
transactions contemplated hereby have been duly and validly authorized; this
Agreement and all agreements contemplated to be executed by the Seller or
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Interim Servicer hereby have been duly executed and delivered and constitute the
valid, legal, binding and enforceable obligations of the Seller, regardless of
whether such enforcement is sought in a proceeding in equity or at law; and all
requisite trust or other action has been taken by the Seller to make this
Agreement and all agreements contemplated hereby valid and binding upon the
Seller in accordance with their terms. The Originator is a limited liability
company duly organized, validly existing and in good standing under the laws of
the state of Delaware, 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 wherein it owns or leases any material properties or 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
Originator, and in any event the Originator 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 Originator has the full power, authority and
legal right to hold, transfer and convey the Mortgage Loans and to execute and
deliver this Agreement and to perform its obligations hereunder; the execution,
delivery and performance of this Agreement (including all instruments of
transfer to be delivered pursuant to this Agreement) by the Originator and the
consummation of the transactions contemplated hereby have been duly and validly
authorized; this Agreement and all agreements contemplated to be executed by the
Originator hereby have been duly executed and delivered and constitute the
valid, legal, binding and enforceable obligations of the Originator, regardless
of whether such enforcement is sought in a proceeding in equity or at law; and
all requisite action has been taken by the Originator to make this Agreement and
all agreements contemplated hereby valid and binding upon the Originator in
accordance with their terms;
(b) Ordinary Course of Business. The consummation of the transactions
contemplated by this Agreement are in the ordinary course of business of the
Seller and the Originator, and the transfer, assignment and conveyance of the
Mortgage Notes and the Mortgages by the Seller or the Originator 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 Seller or the
Originator, the sale of the Mortgage Loans to the Purchaser, the consummation of
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, conditions or provisions of the Seller's or the
Originator's organizational documents or any legal restriction or any agreement
or instrument to which the Seller or the Originator is now a party or by which
it is bound, or constitute a default or result in an acceleration under any of
the foregoing, or result in the violation of any law, rule, regulation, order,
judgment or decree to which the Seller or the Originator or their property is
subject, or result in the creation or imposition of any lien, charge or
encumbrance that would have an adverse effect upon any of their properties
pursuant to the terms of any mortgage, contract, deed of trust or other
instrument, or impair the ability of the Purchaser to realize on the Mortgage
Loans, impair the value of the Mortgage Loans, or impair the ability of the
Purchaser to realize the full amount of any insurance benefits accruing pursuant
to this Agreement;
(d) Ability to Service. The Interim Servicer has the facilities,
procedures, and experienced personnel necessary for the sound servicing of
mortgage loans of the same type as
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the Mortgage Loans. The Interim Servicer is duly qualified, licensed, registered
and otherwise authorized under all applicable federal, state and local laws, and
regulations, if applicable, and is in good standing to enforce, originate, sell
mortgage loans to, and service mortgage loans in each jurisdiction wherein the
Mortgaged Properties are located;
(e) Reasonable Servicing Fee. The Seller, on behalf of the Interim
Servicer, 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 Interim Servicer, for accounting and tax purposes, as
compensation for the servicing and administration of the Mortgage Loans pursuant
to this Agreement and the Interim Servicing Agreement;
(f) Ability to Perform; Solvency. The Seller and the Originator do not
believe, nor do they have any reason or cause to believe, that they cannot
perform each and every covenant contained in this Agreement. The Seller and the
Originator are solvent and the sale of the Mortgage Loans will not cause the
Seller or the Originator to become insolvent. The sale of the Mortgage Loans is
not undertaken with the intent to hinder, delay or defraud any of the Seller's
or the Originator's creditors;
(g) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or, to the best of the Seller's and the Originator's
knowledge, threatened against the Seller or the Originator, before any court,
administrative agency or other tribunal asserting the invalidity of this
Agreement, seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or 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 Seller or the
Originator, or in any material impairment of the right or ability of the Seller
or the Originator to carry on their business substantially as now conducted, or
in any material liability on the part of the Seller or the Originator, or which
would draw into question the validity of this Agreement or the Mortgage Loans or
of any action taken or to be taken in connection with the obligations of the
Seller or the Originator contemplated herein, or which would be likely to impair
the ability of the Seller or the Originator to perform under the terms of this
Agreement;
(h) No Consent Required. No consent, approval, authorization or order
of, or registration or filing with, or notice to any court or governmental
agency or body including HUD, the FHA or the Department of Veterans Affairs is
required for the execution, delivery and performance by the Seller or the
Originator of or compliance by the Seller or the Originator with this Agreement
or the Mortgage Loans, the delivery of a portion of the Mortgage Files to the
Custodian or the sale of the Mortgage Loans or the consummation of the
transactions contemplated by this Agreement, or if required, such approval has
been obtained prior to the related Closing Date;
(i) Selection Process. The Mortgage Loans were selected from among the
outstanding one- to four-family mortgage loans in the Seller's portfolio at the
related Closing Date as to which the representations and warranties set forth in
Subsection 8.02 could be made and such selection was not made in a manner so as
to affect adversely the interests of the Purchaser;
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(j) No Untrue Information. Neither this Agreement nor any information,
statement, tape, diskette, report, form, or other document furnished or to be
furnished pursuant to this Agreement or any Reconstitution Agreement or in
connection with the transactions contemplated hereby (including any
Securitization Transaction or Whole Loan Transfer) contains or will contain any
untrue statement of material fact or omits or will omit to state a material fact
necessary to make the statements contained herein or therein not misleading;
(k) Financial Statements. The Seller has delivered to the Purchaser
financial statements of the Guarantor (on a consolidated basis) as to its last
three (3) complete fiscal years and any later quarter ended more than sixty (60)
days prior to the execution of this Agreement. All such financial statements
fairly present the pertinent results of operations and changes in financial
position for each of such periods and the financial position at the end of each
such period of the Seller and its subsidiaries and have been prepared in
accordance with generally accepted accounting principles of the United States
consistently applied throughout the periods involved, except as set forth in the
notes thereto. There has been no change in the business, operations, financial
condition, properties or assets of the Seller since the date of the Seller's
financial statements that would have an adverse effect on its ability to perform
its obligations under this Agreement. The Seller has completed any forms
requested by the Purchaser in a timely manner and in accordance with the
provided instructions;
(l) No Brokers. The Seller and the Originator have 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;
(m) Sale Treatment. The Seller has been advised by its independent
certified public accountants that under generally accepted accounting principles
the transfer of the Mortgage Loans may be treated as a sale on the books and
records of the Seller and the Seller has determined that the disposition of the
Mortgage Loans pursuant to this Agreement will be afforded sale treatment for
tax and accounting purposes;
(n) Reasonable Purchase Price. The consideration received by the
Seller upon the sale of the Mortgage Loans under this Agreement constitutes fair
consideration and reasonably equivalent value for the Mortgage Loans;
(o) Owner of Record. The Seller or Originator is the owner of record
of each Mortgage and the indebtedness evidenced by each Mortgage Note, and upon
the sale of the Mortgage Loans to the Purchaser, the Seller or Originator will
retain the Mortgage Files with respect thereto in trust only for the purpose of
servicing and supervising the servicing of each Mortgage Loan;
(p) Seller or Originator's Origination. The Seller's or Originator's
decision to originate any mortgage loan or to deny any mortgage loan application
is an independent decision based upon the Underwriting Guidelines, and is in no
way made as a result of Purchaser's decision to purchase, or not to purchase, or
the price Purchaser may offer to pay for, any such mortgage loan, if originated;
and
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(q) Compliance with Anti-Money Laundering Laws. Each of the Seller and
Originator have complied with all applicable anti-money laundering laws,
regulations and executive orders, including without limitation the USA PATRIOT
Act of 2001 (collectively, the "Anti-Money Laundering Laws"); each of the Seller
and Originator have established an anti-money laundering compliance program as
required by the Anti-Money Laundering Laws, have conducted the requisite due
diligence in connection with the origination of each Mortgage Loan for purposes
of the Anti-Money Laundering Laws, including with respect to the legitimacy of
the applicable Mortgagor and the origin of the assets used by the said Mortgagor
to purchase the property in question, and maintains, and will maintain,
sufficient information to identify the applicable Mortgagor for purposes of the
Anti-Money Laundering Laws;
(r) Delivery to the Custodian. The Mortgage Note, the Mortgage, the
Assignment of Mortgage and any other documents required to be delivered with
respect to each Mortgage Loan pursuant to the Custodial Agreement shall be
delivered to the Custodian all in compliance with the specific requirements of
the Custodial Agreement. With respect to each Mortgage Loan, the Seller or the
Interim Servicer will be in possession of a complete Mortgage File in compliance
with Exhibit A hereto, except for such documents as will be delivered to the
Custodian; and
(s) Credit Reporting. The Interim Servicer, for so long as it is the
Interim Servicer for each Mortgage Loan, will 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.
Subsection 8.02. Representations and Warranties Regarding Individual
Mortgage Loans.
Each of the Seller and the Originator hereby represents and warrants
to the Purchaser that, as to each Mortgage Loan, as of the related Closing Date
for such Mortgage Loan:
(a) Mortgage Loans as Described. The information set forth in the
Mortgage Loan Schedule is complete, true and correct;
(b) Payments Current. All payments required to be made up to the
Closing Date under the terms of the Mortgage Note have been made and credited,
or will be made and credited in the month in which such payment is due. As of
the Closing Date, no payment required under the Mortgage Loan is thirty (30)
days or more delinquent nor has any payment under the Mortgage Loan been thirty
(30) days or more delinquent at any time since the origination of the Mortgage
Loan;
(c) No Outstanding Charges. Other than any payment required under any
Mortgage Loan that is less than thirty (30) days delinquent, there are no
defaults in complying with the terms of the Mortgage securing the Mortgage Loan,
and all taxes, governmental assessments, insurance premiums, water, sewer and
municipal charges, leasehold payments or ground rents which previously became
due and owing have been paid, or an escrow of funds has
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been established in an amount sufficient to pay for every such item which
remains unpaid and which has been assessed but is not yet due and payable.
Except for (A) payments in the nature of escrow payments and (B) interest
accruing from the date of the Mortgage Note or date of disbursement of the
Mortgage Loan proceeds, whichever is earlier to the day which precedes by one
(1) month the Due Date of the first installment of principal and interest,
including, without limitation, taxes and insurance payments, the Seller has not
advanced funds, or induced, solicited or knowingly received any advance of funds
by a party other than the Mortgagor, directly or indirectly, for the payment of
any amount required under the Mortgage Loan;
(d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any respect,
from the date of origination 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 Custodian or to such other Person as the Purchaser shall
designate in writing, and the terms of which are reflected in the Mortgage Loan
Schedule. The substance of any such waiver, alteration or modification has been
approved by the title insurer, if any, to the extent required by the policy, and
its terms are reflected on the Mortgage Loan Schedule, if applicable. 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, and which assumption agreement is part of the Mortgage Loan File
delivered to the Custodian or to such other Person as the Purchaser shall
designate in writing and the terms of which are reflected in the related
Mortgage Loan Schedule;
(e) 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, and no Mortgagor
was a debtor in any state or federal bankruptcy or insolvency proceeding at, or
subsequent to, the time the Mortgage Loan was originated;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are provided for in the Xxxxxx Mae Guides or by
Xxxxxxx Mac, as well as all additional requirements set forth in Section 2.10 of
the Interim Servicing Agreement attached hereto as Exhibit B. If required by the
National Flood Insurance Act of 1968, as amended, each Mortgage Loan is covered
by a flood insurance policy meeting the requirements of the current guidelines
of the Federal Insurance Administration in effect, which policy conforms to
Xxxxxx Mae and Xxxxxxx Mac, as well as all additional requirements set forth in
Section 2.10 of the Interim Servicing Agreement attached hereto as Exhibit B.
All individual insurance policies contain a standard mortgagee clause naming the
Seller (or the Originator) and its successors and assigns as mortgagee, and all
premiums thereon have been paid and such policies may not be reduced, terminated
or cancelled without thirty (30) days' prior written notice to the mortgagee.
The Mortgage obligates the Mortgagor thereunder to maintain the hazard insurance
policy at the Mortgagor's cost and expense, and on the Mortgagor's failure to do
so, authorizes the holder of the Mortgage to obtain and maintain such insurance
at such Mortgagor's cost and expense, and to seek reimbursement
-23-
therefor from the Mortgagor. Where required by state law or regulation, the
Mortgagor has been given an opportunity to choose the carrier of the required
hazard insurance, provided the policy is not a "master" or "blanket" hazard
insurance policy covering a condominium, or any hazard insurance policy covering
the common facilities of a planned unit development. The hazard insurance policy
is the valid and binding obligation of the insurer, is in full force and effect,
and will be in full force and effect and inure to the benefit of the Purchaser
upon the consummation of the transactions contemplated by this Agreement. The
Seller has not engaged in, and has no knowledge of the Mortgagor's or any
servicer's having engaged in, any act or omission which would impair the
coverage of any such policy, the benefits of the endorsement provided for
herein, or the validity and binding effect of such policy, including, without
limitation, no unlawful fee, commission, kickback or other unlawful compensation
or value of any kind has been or will be received, retained or realized by any
attorney, firm or other person or entity, and no such unlawful items have been
received, retained or realized by the Seller;
(g) 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,
predatory, abusive and fair lending, equal credit opportunity and disclosure
laws applicable to the Mortgage Loan, including, without limitation, any
provisions relating to prepayment penalties, have been complied with, the
consummation of the transactions contemplated hereby will not involve the
violation of any such laws or regulations, and the Seller or the Interim
Servicer 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. This representation is a Deemed Material
Breach Representation; (h) 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 release, cancellation, subordination or rescission. The Seller has not
waived the performance by the Mortgagor of any action, if the Mortgagor's
failure to perform such action would cause the Mortgage Loan to be in default,
nor has the Seller waived any default resulting from any action or inaction by
the Mortgagor;
(i) Location and Type of Mortgaged Property. The Mortgaged Property is
a fee simple property located in the state identified in the Mortgage Loan
Schedule except that with respect to real property located in jurisdictions in
which the use of leasehold estates for residential properties is a
widely-accepted practice, the Mortgaged Property may be a leasehold estate and
consists of a single parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual
residential condominium unit in a condominium project, or an individual unit in
a planned unit development and that no residence or dwelling is a mobile home,
provided, however, that any condominium unit or planned unit development shall
not fall within any of the "Ineligible Projects" of part XII, Section 102 of the
Xxxxxx Xxx Selling Guide and shall conform with the Underwriting Guidelines. In
the case of any Mortgaged Properties that are manufactured homes (a
"Manufactured Home Mortgage Loans"), (A) (i) such Manufactured Home Mortgage
Loan conforms with the applicable Xxxxxx Mae or Xxxxxxx Mac requirements
regarding mortgage loans related to manufactured dwellings, (ii) the related
manufactured dwelling is permanently affixed
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to the land, (iii) the related manufactured dwelling and the related land are
subject to a Mortgage properly filed in the appropriate public recording office
and naming Seller as mortgagee, (iv) the applicable laws of the jurisdiction in
which the related Mortgaged Property is located will deem the manufactured
dwelling located on such Mortgaged Property to be a part of the real property on
which such dwelling is located, (v) such Manufactured Home Mortgage Loan is (x)
a qualified mortgage under Section 860G(a)(3) of the Internal Revenue Code of
1986, as amended and (y) secured by manufactured housing treated as a single
family residence under Section 25(e)(10) of the Code (i.e., such manufactured
home has a minimum of 400 square feet of living space, a minimum width in excess
of 102 inches and which is of a kind customarily used at a fixed location) and
(vi) as of the origination date of the related Mortgage Loan, the related
manufactured housing unit that secures such Mortgage Loan either: (x) was the
principal residence of the Mortgagor or (y) was classified as real property
under applicable state law. As of the date of origination, no portion of the
Mortgaged Property was used for commercial purposes, and since the date of
origination, no portion of the Mortgaged Property has been used for commercial
purposes; provided, that Mortgaged Properties which contain a home office shall
not be considered as being used for commercial purposes as long as the Mortgaged
Property has not been altered for commercial purposes and is not storing any
chemicals or raw materials other than those commonly used for homeowner repair,
maintenance and/or household purposes. This representation is a Deemed Material
Breach Representation;
(j) Valid First and Second Lien. Each Mortgage is a valid and
subsisting first lien, with respect to First Lien Loans, or second lien, with
respect to Second Lien Loans, of record on a single parcel of real estate
constituting the Mortgaged Property, including all buildings and improvements 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,
subject in all cases to the exceptions to title set forth in the title insurance
policy with respect to the related Mortgage Loan, which exceptions are generally
acceptable to prudent mortgage lending companies, and such other exceptions to
which similar properties are commonly subject and which do not individually, or
in the aggregate, materially and adversely affect the benefits of the security
intended to be provided by such Mortgage. In no event shall any Mortgage Loan be
in a lien position more junior than a second lien. The lien of the Mortgage is
subject only to:
(1) with respect to Second Lien Loans, the lien of the first
mortgage on the Mortgaged Property;
(2) the lien of current real property taxes and assessments
not yet due and payable;
(3) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date
of recording acceptable to prudent mortgage lending institutions
generally and specifically referred to in the lender's title
insurance policy delivered to the originator of the Mortgage Loan
and (a) specifically referred to or otherwise considered in the
appraisal made for the originator of the Mortgage Loan or (b)
which do not adversely affect the Appraised Value of the
Mortgaged Property set forth in such appraisal; and
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(4) 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, enforceable and perfected (A) first lien and first priority security
interest with respect to each First Lien Loan, or (B) second lien and second
priority security interest with respect to each Second Lien Loan, in either
case, on the property described therein and Seller has full right to sell and
assign the same to Purchaser. The Mortgaged Property was not, unless indicated
on the related Mortgage Loan Schedule in the case of a First Lien Loan, as of
the date of origination of the Mortgage Loan, subject to a mortgage, deed of
trust, deed to secure debt or other security instrument creating a lien
subordinate to the lien of the Mortgage;
(k) Validity of Mortgage Documents. The Mortgage Note and the Mortgage
and any other agreement executed and delivered by a Mortgagor or guarantor, if
applicable, in connection with a Mortgage Loan are genuine, and each is the
legal, valid and binding obligation of the maker thereof enforceable in
accordance with its terms (including, without limitation, any provisions therein
relating to prepayment penalties). All parties to the Mortgage Note, the
Mortgage and any other such related agreement had legal capacity to enter into
the Mortgage Loan and to execute and deliver the Mortgage Note, the Mortgage and
any other related agreement, and the Mortgage Note, the Mortgage and any other
such related agreement have been duly and properly executed by other such
related parties. The documents, instruments and agreements submitted for loan
underwriting were not falsified and contain no untrue statement of material fact
or omit to state a material fact required to be stated therein or necessary to
make the information and statements therein not misleading. No fraud, error,
omission, misrepresentation, negligence or similar occurrence with respect to a
Mortgage Loan has taken place on the part of any Person, including without
limitation, the Mortgagor, any appraiser, any builder or developer, or any other
party involved in the origination or servicing of the Mortgage Loan. The Seller
has reviewed all of the documents constituting the Servicing File and has made
such inquiries as it deems necessary to make and confirm the accuracy of the
representations set forth herein;
(l) Full Disbursement of Proceeds. The Mortgage Loan has been closed
and the proceeds of the Mortgage Loan have been fully disbursed and there is no
requirement for future advances thereunder, and any and all requirements as to
completion of any on-site or off-site improvement and as to disbursements of any
escrow funds therefor have been complied with. 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;
(m) Ownership. The Seller is the sole owner of record and holder of
the Mortgage Loan and the indebtedness evidenced by each Mortgage Note and upon
the sale of the Mortgage Loans to the Purchaser, the Seller will retain the
Mortgage Files or any part thereof with respect thereto not delivered to the
Custodian, the Purchaser or the Purchaser's designee, in trust only for the
purpose of servicing and supervising the servicing of each Mortgage Loan. The
Mortgage Loan is not assigned or pledged, and Seller has good, indefeasible and
marketable title
-26-
thereto, and has full right to transfer and sell the Mortgage Loan to the
Purchaser free and clear of any encumbrance, equity, participation interest,
lien, pledge, charge, claim or security interest, and has full right and
authority subject to no interest or participation of, or agreement with, any
other party, to sell and assign each Mortgage Loan pursuant to this Agreement
and following the sale of each Mortgage Loan, the Purchaser will own such
Mortgage Loan free and clear of any encumbrance, equity, participation interest,
lien, pledge, charge, claim or security interest. The Seller intends to
relinquish all rights to possess, control and monitor the Mortgage Loan. After
the Closing Date, the Seller will have no right to modify or alter the terms of
the sale of the Mortgage Loan and the Seller will have no obligation or right to
repurchase the Mortgage Loan or substitute another Mortgage Loan, except as
provided in this Agreement;
(n) Doing Business. 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 (2) either (i) organized
under the laws of such state, or (ii) qualified to do business in such state, or
(iii) a federal savings and loan association, a savings bank or a national bank
having a principal office in such state, or (3) not doing business in such
state;
(o) CLTV, LTV; FICO Score. No Mortgage Loan that is a Second Lien Loan
has a CLTV in excess of 100%. No Mortgage Loan has an LTV greater than 100%. At
origination of the Mortgage Loan, the Mortgagor did not have a FICO score of
less than 500;
(p) Title Insurance. The Mortgage Loan is covered by an ALTA lender's
title insurance policy or other generally acceptable form of policy or insurance
acceptable to Xxxxxx Xxx or Xxxxxxx Mac and each such title insurance policy is
issued by a title insurer acceptable to Xxxxxx Mae or Xxxxxxx Mac and qualified
to do business in the jurisdiction where the Mortgaged Property is located,
insuring the Originator, its successors and assigns, as to the first priority
lien (with respect to First Lien Loans) or second priority lien (with respect to
Second Lien Loans) of the Mortgage in the original principal amount of the
Mortgage Loan, subject only to the exceptions contained in clauses (1) and (2)
of paragraph (j) of this Subsection 8.02, and in the case of Adjustable Rate
Mortgage Loans, against any loss by reason of the invalidity or unenforceability
of the lien resulting from the provisions of the Mortgage providing for
adjustment to the Mortgage Interest Rate and Monthly Payment. Where required by
state law or regulation, the Mortgagor has been given the opportunity to choose
the carrier of the required mortgage title insurance. Additionally, such
lender's title insurance policy affirmatively insures ingress and egress, and
against encroachments by or upon the Mortgaged Property or any interest therein.
The title policy does not contain any special exceptions (other than the
standard exclusions) for zoning and uses and has been marked to delete the
standard survey exception or to replace the standard survey exception with a
specific survey reading. The Seller (or the Originator), its successors and
assigns, are the sole insureds of such lender's title insurance policy, and such
lender's title insurance policy is valid and remains 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 related Mortgage, including
the Seller, has done, by act or omission, anything which would impair the
coverage of such lender's title insurance policy, including without limitation,
no unlawful fee, commission, kickback or other unlawful compensation or value of
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any kind has been or will be received, retained or realized by any attorney,
firm or other person or entity, and no such unlawful items have been received,
retained or realized by the Seller;
(q) No Defaults. There is no default, breach, violation or event which
would permit acceleration existing under the Mortgage or the Mortgage Note and
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
which would permit acceleration, and neither the Seller nor any of its
affiliates nor any of their respective predecessors, have waived any default,
breach, violation or event which would permit acceleration. With respect to each
Second Lien Loan, (i) the prior mortgage is in full force and effect, (ii) there
is no default, breach, violation or event of acceleration existing under such
prior mortgage or the related mortgage note, (iii) there is 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 of acceleration
thereunder, and either (A) the prior mortgage contains a provision which allows
or (B) applicable law requires, the mortgagee under the Second Lien Loan to
receive notice of, and affords such mortgagee an opportunity to cure any default
by payment in full or otherwise under the prior mortgage;
(r) 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 covered by the
title insurance specified in clause (p);
(s) Location of Improvements; No Encroachments. 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. The Mortgaged Property and all improvements located on or
being part of the Mortgaged Property are in compliance with all applicable
zoning and building laws, ordinances and regulations;
(t) Origination; Payment Terms. The Mortgage Loan was originated by a
mortgagee approved by the Secretary of Housing and Urban Development pursuant to
Sections 203 and 211 of the Act, a savings and loan association, a savings bank,
a commercial bank, credit union, insurance company or other similar institution
which is supervised and examined by a federal or state authority. The documents,
instruments and agreements submitted for loan underwriting were not falsified
and contain no untrue statement of material fact or omit to state a material
fact required to be stated therein or necessary to make the information and
statements therein not misleading. No Mortgage Loan contains terms or provisions
which would result in negative amortization. Other than with respect to Mortgage
Loans that require only payments of interest for a specified period of time
after origination, principal payments on the Mortgage Loan commenced no more
than sixty (60) days after funds were disbursed in connection with the Mortgage
Loan. The Mortgage Interest Rate as well as, with respect to Adjustable Rate
Mortgage Loans, the Lifetime Rate Cap, the Periodic Rate Floor and the Periodic
Rate Cap are as set forth on the related Mortgage Loan Schedule. The Mortgage
Interest Rate is adjusted, with respect to Adjustable Rate Mortgage Loans, on
each Interest Rate Adjustment Date to equal the Index plus the Gross Margin
(rounded up or down to the nearest 0.125%), subject to the Periodic Rate Cap.
Other than with respect to Mortgage Loans that
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require only payments of interest for a specified period of time after
origination, the Mortgage Note is payable in equal monthly installments of
principal and interest, which installments of interest, with respect to
Adjustable Rate Mortgage Loans, are subject to change due to the adjustments to
the Mortgage Interest Rate on each Interest Rate Adjustment Date, with interest
calculated and payable in arrears, sufficient to amortize the Mortgage Loan
fully by the stated maturity date (unless the Mortgage Loan is identified on the
related Mortgage Loan Schedule as a Balloon Mortgage Loan), over an original
term of not more than thirty (30) years from commencement of amortization
(except in the case of Mortgage Loans which have a stated maturity of 30 years
but amortize based on a 40 year schedule). Unless otherwise specified on the
related Mortgage Loan Schedule, the Mortgage Loan is payable on the first day of
each month. There are no Convertible Mortgage Loans which contain a provision
allowing the Mortgagor to convert the Mortgage Note from an adjustable interest
rate Mortgage Note to a fixed interest rate Mortgage Note. The Due Date of the
first payment under the Mortgage Note is no more than sixty (60) days from the
date of the Mortgage Note;
(u) 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. Upon default by a Mortgagor on a Mortgage Loan and
foreclosure on, or trustee's sale of, the Mortgaged Property pursuant to the
proper procedures, the holder of the Mortgage Loan will be able to deliver good
and merchantable title to the Mortgaged Property. 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, subject to applicable federal and state laws and judicial precedent
with respect to bankruptcy and right of redemption or similar law;
(v) Conformance with Agency and Underwriting Guidelines. The Mortgage
Loan was underwritten in accordance with the Underwriting Guidelines (a copy of
which is attached to the related Assignment and Conveyance Agreement as Exhibit
C). The Mortgage Note and Mortgage are on forms acceptable to Xxxxxxx Mac or
Xxxxxx Mae and no representations have been made to a Mortgagor that are
inconsistent with the mortgage instruments used;
(w) Occupancy of the Mortgaged Property. As of the Closing Date the
Mortgaged Property is lawfully occupied under applicable law. 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. The Seller has not received notification from any
Governmental Authority that the Mortgaged Property is in material non-compliance
with such laws or regulations, is being used, operated or occupied unlawfully or
has failed to have or obtain such inspection, licenses or certificates, as the
case may be. The Seller has not received notice of any violation or failure to
conform with any such law, ordinance, regulation, standard, license or
certificate;
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(x) No Additional Collateral. The Mortgage Note is not and has not
been secured by any collateral except the lien of the corresponding Mortgage and
the security interest of any applicable security agreement or chattel mortgage
referred to in paragraph (j) above;
(y) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and duly qualified under applicable law to serve as
such, has been properly designated and currently so serves and is named in the
Mortgage (or in the case of a substitution of trustee, is named in a properly
recorded substitution of trustee), and no fees or expenses are or will become
payable by the Purchaser, the Custodian or the Interim Servicer to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor;
(z) Acceptable Investment. There are no circumstances or conditions
with respect to the Mortgage, the Mortgaged Property, the Mortgagor, the
Mortgage File or the Mortgagor's credit standing that can reasonably be expected
to cause private institutional investors to regard the Mortgage Loan as an
unacceptable investment, cause the Mortgage Loan to become delinquent, or
adversely affect the value or marketability of the Mortgage Loan, or cause the
Mortgage Loan to prepay during any period materially faster or slower than the
mortgage loans originated by the Originator generally;
(aa) Delivery of Mortgage Documents. The Mortgage Note, the Mortgage,
the Assignment of Mortgage and any other documents required to be delivered
under this Agreement for each Mortgage Loan have been delivered to the
Custodian. The Seller or the Interim Servicer is in possession of a complete,
true and accurate Mortgage File in compliance with Exhibit A hereto, except for
such documents the originals of which have been delivered to the Custodian, and
the Seller or the Interim Servicer has retained copies thereof;
(bb) Condominiums/Planned Unit Developments. 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
is (i) acceptable to Xxxxxx Xxx or Xxxxxxx Mac or (ii) located in a condominium
or planned unit development project which has received project approval from
Xxxxxx Mae or Xxxxxxx Mac. The representations and warranties required by Xxxxxx
Mae with respect to such condominium or planned unit development have been
satisfied and remain true and correct;
(cc) Transfer of Mortgage Loans. Except with respect to MERS
Designated Mortgage Loans, the Assignment of Mortgage with respect to each
Mortgage Loan is in recordable form and is acceptable for recording under the
laws of the jurisdiction in which the Mortgaged Property is located. The
transfer, assignment and conveyance of the Mortgage Notes and the Mortgages by
the Seller are not subject to the bulk transfer or similar statutory provisions
in effect in any applicable jurisdiction;
(dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision for the acceleration of the payment
of the unpaid principal balance of the Mortgage Loan in the event that the
Mortgaged Property is sold or transferred without the prior written consent of
the mortgagee thereunder;
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(ee) No Balloon Mortgage Loans. The Mortgage Loan is not a Balloon
Mortgage Loan unless specifically listed on the related Mortgage Loan Schedule;
(ff) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to which
Monthly Payments are paid or partially paid with funds deposited in any separate
account established by the Seller, the Mortgagor, or anyone on behalf of the
Mortgagor, or paid by any source other than the Mortgagor nor does it contain
any other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan, and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature. The
indebtedness evidenced by the Mortgage Note is not convertible to an ownership
interest in the Mortgaged Property or the Mortgagor and the Seller has not
financed nor does it own directly or indirectly, any equity of any form in the
Mortgaged Property or the Mortgagor;
(gg) Consolidation of Future Advances. Any future advances made to the
Mortgagor prior to the applicable Cut-off Date have been consolidated with the
outstanding principal amount secured by the Mortgage, and the secured principal
amount, as consolidated, bears a single interest rate and single repayment term.
The lien of the Mortgage securing the consolidated principal amount is expressly
insured as having first or second, as applicable, lien priority by a title
insurance policy, an endorsement to the policy insuring the mortgagee's
consolidated interest or by other title evidence acceptable to Xxxxxx Xxx and
Xxxxxxx Mac. The consolidated principal amount does not exceed the original
principal amount of the Mortgage Loan;
(hh) Mortgaged Property Undamaged; No Condemnation Proceedings. There
has been since origination, and is, no proceeding pending or threatened for the
total or partial condemnation of the Mortgaged Property. The Mortgaged Property
is undamaged by waste, 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 and each Mortgaged Property is in good repair;
(ii) Collection Practices; Escrow Deposits; Interest Rate Adjustments.
The origination, servicing and collection practices with respect to the Mortgage
Loan have been in all respects in compliance with Accepted Servicing Practices,
applicable laws and regulations, and have been in all respects legal and proper.
With respect to escrow deposits and Escrow Payments (other than with respect to
Second Lien Loans for which the mortgagee under the prior mortgage lien is
collecting Escrow Payments), all such payments are in the possession of Seller
and there exist no deficiencies in connection therewith for which customary
arrangements for repayment thereof have not been made. Each Mortgage Loan is
covered by a paid in full, life of loan, tax service contract that will be
assigned without penalty, premium or cost to the Purchaser or its designee. All
Escrow Payments have been collected in full compliance with state and federal
law and the provisions of the related Mortgage Note and Mortgage. An escrow of
funds is not prohibited by applicable law and has been established in an amount
sufficient 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 Seller have been capitalized under the Mortgage or
the Mortgage Note. All Mortgage Interest Rate adjustments have been made in
strict compliance with state and federal law and the terms of the related
Mortgage and
-31-
Mortgage Note on the related Interest Rate Adjustment Date. If, pursuant to the
terms of the Mortgage Note, another index was selected for determining the
Mortgage Interest Rate, the same index was used with respect to each Mortgage
Note which required a new index to be selected, and such selection did not
conflict with the terms of the related Mortgage Note. Any and all notices
required under applicable law and the terms of the related Mortgage Note and
Mortgage regarding the Mortgage Interest Rate and the Monthly Payment
adjustments have been delivered. Any interest required to be paid pursuant to
state, federal and local law has been properly paid and credited;
(jj) Other Insurance Policies; No Defense to Coverage. No action,
inaction or event has occurred and no state of facts exists or has existed on or
prior to the Closing Date that has resulted or will result in the exclusion
from, denial of, or defense to coverage under any applicable primary mortgage
insurance policy, hazard insurance policy or bankruptcy bond (including, without
limitation, any exclusions, denials or defenses which would limit or reduce the
availability of the timely payment of the full amount of the loss otherwise due
thereunder to the insured), irrespective of the cause of such failure of
coverage. The Seller has caused or will cause to be performed any and all acts
required to preserve the rights and remedies of the Purchaser in any insurance
policies applicable to the Mortgage Loans including, without limitation, any
necessary notifications of insurers, assignments of policies or interests
therein, and establishments of coinsured, joint loss payee and mortgagee rights
in favor of the Purchaser. In connection with the placement of any such
insurance, no commission, fee, or other compensation has been or will be
received by the Seller or by any officer, director, or employee of the Seller or
any designee of the Seller or any corporation in which the Seller or any
officer, director, or employee had a financial interest at the time of placement
of such insurance;
(kk) No Violation of Environmental Laws. The Mortgaged Property is
free from any and all toxic or hazardous substances and there exists no
violation of any local, state or federal environmental law, rule or regulation.
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; 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;
(ll) Servicemembers' Civil Relief Act. The Mortgagor has not notified
the Seller, and the Seller has no knowledge of any relief requested or allowed
to the Mortgagor under the
