XXXXXX CAPITAL, A DIVISION OF XXXXXX BROTHERS HOLDINGS INC.,
the "Purchaser"
and
HOUSEHOLD BANK, f.s.b.
the "Company"
and
FLEET MORTGAGE CORP.
the "Servicer"
__________________________________________________________________
MORTGAGE LOAN SALE AND SERVICING AGREEMENT
Dated as of November 1, 1996
__________________________________________________________________
Conventional Residential Fixed Rate Mortgage Loans
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS
Section 1.01. Definitions ................................ 2
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
POSSESSION OF MORTGAGE FILES;
BOOKS AND RECORDS; DELIVERY OF DOCUMENTS
Section 2.01. Conveyance of Mortgage Loans;
Possession of Mortgage Files;
Maintenance of Servicing Files ............. 13
Section 2.02. Books and Records; Transfers of
Mortgage Loans ............................. 13
Section 2.03. Delivery of Documents ...................... 14
ARTICLE III
REPRESENTATIONS AND WARRANTIES:
REMEDIES AND BREACH
Section 3.01. Company Representations and Warranties ..... 15
Section 3.02. Servicer Representations and Warranties .... 18
Section 3.03. Representations and Warranties Regarding
Individual Mortgage Loans .................. 20
Section 3.04. Remedies for Breach of Representations
and Warranties ............................. 29
ARTICLE IV
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 4.01. Servicer to Act as Servicer ................ 32
Section 4.02. Liquidation of Mortgage Loans .............. 34
Section 4.03. Collection of Mortgage Loan Payments ....... 34
Section 4.04. Establishment of and Deposits
to Custodial Account ....................... 34
Section 4.05. Permitted Withdrawals From
Custodial Account .......................... 36
Section 4.06. Establishment of and Deposits
to Escrow Account .......................... 37
Section 4.07. Permitted Withdrawals From Escrow Account .. 38
Section 4.08. Payment of Taxes, Insurance and
Other Charges .............................. 38
Section 4.09. Protection of Accounts ..................... 39
Section 4.10. Maintenance of Hazard Insurance ............ 39
Section 4.11. Maintenance of Mortgage Impairment
Insurance .................................. 40
Section 4.12. Maintenance of Fidelity Bond and
Errors and Omissions Insurance ............. 40
Section 4.13. Inspections ................................ 41
Section 4.14. Restoration of Mortgaged Property .......... 41
Section 4.15. Maintenance of Primary Mortgage
Insurance; Claims .......................... 41
Section 4.16. Title Management and Disposition of
REO Property ............................... 42
Section 4.17. Real Estate Owned Reports .................. 44
Section 4.18. Liquidation Reports ........................ 44
Section 4.19. Reports of Foreclosures and Abandonments
of Mortgaged Property ...................... 44
ARTICLE V
PAYMENTS TO PURCHASER
Section 5.01. Remittances ................................ 45
Section 5.02. Statements to Purchaser .................... 45
Section 5.03. Monthly Advances by Servicer ............... 46
ARTICLE VI
GENERAL SERVICING PROCEDURES
Section 6.01. Transfers of Mortgaged Property ............ 46
Section 6.02. Satisfaction of Mortgages and Release
of Mortgage Files .......................... 47
Section 6.03. Servicing Compensation ..................... 47
Section 6.04. Annual Statement Regarding Minimum
Servicing Standards ........................ 48
Section 6.05. Annual Independent Certified Public
Accountants' Servicing Report .............. 48
Section 6.06. Right to Examine Servicer Records .......... 48
ARTICLE VII
COMPANY AND SERVICER TO COOPERATE
Section 7.01. Provision of Information ................... 49
Section 7.02. Financial Statements; Servicing Facility ... 49
ARTICLE VIII
THE COMPANY AND SERVICER
Section 8.01. Indemnification; Third Party Claims ........ 49
Section 8.02. Merger or Consolidation of the Company
or the Servicer ............................ 50
Section 8.03. Limitation on Liability of Company,
Servicer and Others ........................ 50
Section 8.04. Limitation on Resignation and Assignment
by Company and the Servicer ................ 51
ARTICLE IX
DEFAULT
Section 9.01. Events of Default .......................... 53
Section 9.02. Waiver of Defaults ......................... 55
ARTICLE X
TERMINATION
Section 10.01. Termination ............................... 55
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01. Successor to Servicer ..................... 55
Section 11.02. Amendment ................................. 56
Section 11.03. Closing ................................... 57
Section 11.04. Governing Law ............................. 58
Section 11.05. Duration of Agreement ..................... 58
Section 11.06. Notices ................................... 58
Section 11.07. Severability of Provisions ................ 59
Section 11.08. Relationship of Parties ................... 59
Section 11.09. Execution; Successors and Assigns ......... 59
Section 11.10. Recordation of Assignments of Mortgage .... 59
Section 11.11. Assignment by Purchaser ................... 60
Section 11.12. No Solicitation ........................... 60
Section 11.13. Reconstitution ............................ 60
EXHIBITS
EXHIBIT A MORTGAGE LOAN SCHEDULE
EXHIBIT B CONTENTS OF EACH MORTGAGE FILE
EXHIBIT C-1 MORTGAGE LOAN DOCUMENTS
EXHIBIT C-2 FORM OF REQUEST FOR RELEASE OF DOCUMENTS AND
RECEIPT
EXHIBIT D-1 CUSTODIAL ACCOUNT CERTIFICATION
EXHIBIT D-2 CUSTODIAL ACCOUNT LETTER AGREEMENT
EXHIBIT E-1 ESCROW ACCOUNT CERTIFICATION
EXHIBIT E-2 ESCROW ACCOUNT LETTER AGREEMENT
EXHIBIT F MONTHLY REMITTANCE ADVICE
EXHIBIT G MONTHLY ELECTRONIC DATA TRANSMISSION
EXHIBIT H FORM OF CERTIFICATE OF SERVICING OFFICER FOR
NONRECOVERABLE ADVANCES
EXHIBIT I EXCEPTIONS TO THE PRIMARY MORTGAGE INSURANCE POLICY
REPRESENTATIONS
EXHIBIT J COMPANY'S OFFICER'S CERTIFICATE
EXHIBIT K SERVICER'S OFFICER'S CERTIFICATE
EXHIBIT L FORM OPINION OF COUNSEL FROM COMPANY
EXHIBIT M FORM OPINION OF COUNSEL FROM SERVICER
EXHIBIT N SECURITY RELEASE CERTIFICATION FORM A
EXHIBIT O SECURITY RELEASE CERTIFICATION FORM B
This is a Mortgage Loan Sale and Servicing Agreement (the
"Agreement") for conventional fixed rate residential first lien
mortgage loans, dated and effective as of November 1, 1996, and is
executed among Xxxxxx Capital, A Division of Xxxxxx Brothers
Holdings Inc., as purchaser (the "Purchaser"), Household Bank,
f.s.b., as seller (together with its successors in interest or
permitted assigns, the "Company") and Fleet Mortgage Corp., as
servicer (together with its successors in interest or permitted
assigns, the "Servicer").
W I T N E S S E T H
WHEREAS, the Purchaser has agreed to purchase from the
Company and the Company has agreed to sell to the Purchaser certain
conventional, fixed rate, residential first lien mortgage loans
(the "Mortgage Loans"), on a servicing retained basis, which have
an aggregate outstanding principal balance as of the close of
business on the Cut-off Date, after deduction of payments due on or
before such date, of ($280,263,423.8776,000,000) and the Servicer
has agreed to service the Mortgage Loans on behalf of the Purchaser
in accordance with the terms set forth herein;
WHEREAS, each of the Mortgage Loans is secured by a
mortgage, deed of trust or other security instrument creating a
first lien on a residential dwelling located in the jurisdiction
indicated on the Mortgage Loan Schedule, which is annexed hereto as
Exhibit A;
WHEREAS, the Purchaser and the Company have agreed that
the Purchaser will assign all of its rights and delegate all of its
obligations hereunder to the Depositor (as defined herein) which in
turn will assign all of its rights and delegate all of its
obligations (except as otherwise specified herein) hereunder to the
Trustee (as defined herein) under the Trust Agreement (as defined
herein), and that each reference herein to the Purchaser is
intended, unless otherwise specified, to mean Xxxxxx Capital or the
Trustee, as assignee, whichever is the holder of the Mortgage Loans
from time to time; and
WHEREAS, the Purchaser, the Company and the Servicer wish
to prescribe the manner of purchase of the Mortgage Loans and the
management, servicing and control of the Mortgage Loans.
NOW, THEREFORE, in consideration of the mutual agreements
hereinafter set forth, and for other good and valuable
consideration, the receipt and adequacy of which is hereby
acknowledged, the Purchaser, the Company and the Servicer agree as
follows:
ARTICLE I
DEFINITIONS
-----------
Section 1.01. Definitions. Whenever used herein, the
following words and phrases, unless the context otherwise requires,
shall have the following meanings:
Accepted Servicing Practices: To the extent that there
are specific servicing procedures and standards set forth in the
FNMA Selling and Servicing Guide (MBS Special Servicing Option), as
from time to time amended, such procedures and standards shall
constitute Accepted Servicing Practices (to the extent that such
procedures and standards are not inconsistent with this Agreement).
For matters as to which no specific servicing procedures or
standards are contained in the FNMA Selling and Servicing Guide
(MBS Special Servicing Option), the then present residential
mortgage loan servicing practices of prudent mortgage lending
institutions that service loans of the same type as the Mortgage
Loans in the jurisdictions in which Mortgaged Properties are
located shall constitute Accepted Servicing Practices; provided,
that, the Servicer shall not be required to obtain the consent of
the Purchaser regarding the Servicer-s determination not to seek
any deficiency judgment against any Mortgagor.
Agreement: This Mortgage Loan Sale and Servicing
Agreement and all amendments hereof and supplements hereto.
ALTA: The American Land Title Association, or any
successor thereto.
Appraised Value: With respect to any Mortgage Loan, the
amount set forth in an appraisal made in connection with the
origination of such Mortgage Loan as the value of the related
Mortgaged Property.
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.
BIF: The Bank Insurance Fund, or any successor thereto.
Business Day: Any day other than (i) a Saturday or
Sunday, or (ii) a day on which banking and savings and loan
institutions in the States of South Carolina, or Wisconsin are
authorized or obligated by law or executive order to be closed.
Buydown Funds: Funds contributed by the Mortgagor or
another source in order to reduce the interest payments required
from the Mortgagor for a specified period in specified amounts.
Buydown Mortgage Loan: Any Mortgage Loan as to which the
Mortgagor pays less than the full monthly payment specified in the
Mortgage Note during the Buydown Period and the difference between
the amount paid by the Mortgagor and the amount specified in the
Mortgage Note is paid from the related Buydown Funds.
Buydown Period: The period during which Buydown Funds are
required to be applied to the related Buydown Mortgage Loan.
Certificates: Any or all of the Certificates issued
pursuant to the Trust Agreement.
Closing Date: November 13, 1996.
Code: The Internal Revenue Code of 1986, as it may be
amended from time to time or any successor statute thereto, and
applicable U.S. Treasury Department regulations issued pursuant
thereto.
Company: Household Bank, f.s.b., a federal savings bank,
or its successor in interest or assigns, or any successor to the
Company under this Agreement appointed as herein provided.
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.
Custodial Account: The separate account or accounts
created and maintained pursuant to Section 4.04.
Custodian: First Trust National Association, in its
capacity as custodian of the Mortgage Loan Documents, or its
successors in interest.
Cut-off Date: November 1, 1996.
DCR: Duff & Xxxxxx Credit Rating Co., or any successor in
interest.
Deleted Mortgage Loan: A Mortgage Loan that is
repurchased by the Company in accordance with the terms of this
Agreement and which is, in the case of a substitution pursuant to
Section 3.04, replaced or to be replaced with one or more
Qualifying Substitute Mortgage Loans.
Depositor: Structured Asset Securities Corporation, a
Delaware corporation, or its successors in interest or assigns.
Determination Date: The 15th day (or if such 15th day is
not a Business Day, the Business Day immediately preceding such
15th day) of the month of the related Remittance Date.
Due Date: The day of the month on which the Monthly
Payment is due on a Mortgage Loan, exclusive of any days of grace.
The Due Date for all of the Mortgage Loans is the first day of each
month.
Due Period: With respect to each Remittance Date, the
period commencing on the second day of the month preceding the
month of such Remittance Date and ending on the first day of the
month of such Remittance Date.
Eligible Account: One or more accounts (i) that are
maintained with a depository institution whose (a) long-term debt
obligations (or, in the case of a depository institution which is
part of a holding company structure, the long-term debt obligations
of such holding company structure) at the time of deposit therein
are rated at least -A- by S&P (or the equivalent by Fitch) and (b)
short-term debt obligations (or, in the case of a depository
institution which is part of a holding company structure, the
short-term debt obligations of such holding company structure) at
the time of deposit therein are rated at least -A-1- by S&P (or the
equivalent by Fitch), (ii) the deposits in which are fully insured
by the FDIC through either the Bank Insurance Fund or the Savings
Association Insurance Fund, (iii) the deposits in which are insured
by the FDIC through either the Bank Insurance Fund or the Savings
Association Insurance Fund (to the limit established by the FDIC)
and the uninsured deposits in which accounts are otherwise secured
such that, as evidenced by an Opinion of Counsel delivered to the
Trustee, the Trustee, on behalf of the Certificateholders has a
claim with respect to the funds in such accounts or a perfected
first security interest against any collateral securing such funds
that is superior to claims of any other depositors or creditors of
the depository institution with which such accounts are maintained,
(iv) that are trust accounts maintained with the trust department
of a federal or state chartered depository institution or trust
company acting in its fiduciary capacity, or (v) that are
maintained with Fleet National Bank, N.A. (-FNB-) provided that
(a) the long-term deposits of FNB are rated at least -A- by S&P (or
the equivalent by Fitch) and (b) the short-term deposits of FNB are
rated at least -A-1- by S&P (or the equivalent by Fitch). If
either S&P or Fitch downgrades the rating of the long-term or
short-term deposits of FNB below the levels specified above, within
30 days of such downgrade, the Custodial Account and Escrow Account
must be established with another depository institution which
satisfies the requirements set forth above.
Eligible Investments: Any one or more of the following
obligations or securities:
(i) direct obligations of, and obligations fully
guaranteed as to timely payment of principal and interest by, the
United States of America or any agency or instrumentality of the
United States of America the obligations of which are backed by the
full faith and credit of the United States of America ("Direct
Obligations");
(ii) federal funds, or demand and time deposits in,
certificates of deposits of, or bankers' acceptances issued by, any
depository institution or trust company (including U.S.
subsidiaries of foreign depositories and the Trustee or any agent
of the Trustee, acting in its respective commercial capacity)
incorporated or organized under the laws of the United States of
America or any state thereof and subject to supervision and
examination by federal or state banking authorities, so long as at
the time of investment or the contractual commitment providing for
such investment the commercial paper or other short-term debt
obligations of such depository institution or trust company (or, in
the case of a depository institution or trust company which is the
principal subsidiary of a holding company, the commercial paper or
other short-term debt or deposit obligations of such holding
company or deposit institution, as the case may be) have been rated
by each Rating Agency in its high-test short-term or one of its two
highest long-term rating categories;
(iii) repurchase agreements collateralized by
Direct Obligations or securities guaranteed by GNMA, FNMA or FHLMC
with any registered broker/dealer subject to Securities Investors'
Protection Corporation jurisdiction or any commercial bank insured
by the FDIC, if such broker/dealer or bank has an uninsured,
unsecured and unguaranteed obligation assigned by each Rating
Agency in its highest short-term rating category;
(iv) securities bearing interest or sold at a
discount issued by any corporation incorporated under the laws of
the United States of America or any state thereof which have a
credit rating from each Rating Agency, at the time of investment or
the contractual commitment providing for such investment, at least
equal to one of the two highest long-term credit rating categories
of each Rating Agency; provided, however, that securities issued by
any particular corporation will not be Eligible Investments to the
extent that investment therein will cause the then outstanding
principal amount of securities issued by such corporation to exceed
20% of the aggregate principal amount of all Eligible Investments
in a Custodial Account; provided, further, that such securities
will not be Eligible Investments if they are published as being
under review with negative implications from either Rating Agency;
(v) commercial paper (including both
noninterest-bearing discount obligations and interest-bearing
obligations payable on demand or on a specified date not more than
180 days after the date of issuance thereof) assigned by each
Rating Agency in its highest short-term rating category;
(vi) a Qualified GIC;
(vii) certificates or receipts representing direct
ownership interests in future interest or principal payments on
obligations of the United States of America or its agencies or
instrumentalities (which obligations are backed by the full faith
and credit of the United States of America) held by a custodian in
safekeeping on behalf of the holders of such receipts; and
(viii) any other demand, money market, 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 or (B) that would not adversely affect the then
current rating by either Rating Agency of any of the Certificates;
provided, however, that no such instrument shall be an Eligible
Investment if such instrument evidences either (i) a right to
receive only interest payments with respect to the obligations
underlying such instrument, or (ii) both principal and interest
payments derived from obligations underlying such instrument and
the principal and interest payments with respect to such instrument
provide a yield to maturity of greater than 120% of the yield to
maturity at par of such underlying obligations, and provided that
any such investment will be a "permitted investment" within the
meaning of Section 860G(a)(5) of the Code.
Errors and Omissions Insurance Policy: An errors and
omissions insurance policy to be maintained by the Servicer
pursuant to Section 4.12.
Escrow Account: The account or accounts created and
maintained pursuant to Section 4.06.
Escrow Payments: With respect to any Mortgage Loan, the
amounts constituting ground rents, taxes, assessments, water rates,
sewer rents, municipal charges, mortgage insurance premiums, fire
and hazard insurance premiums, condominium charges, and any other
payments required to be escrowed by the Mortgagor with the
mortgagee pursuant to the Mortgage or any other related document.
Event of Default: Any one of the conditions or
circumstances enumerated in Section 9.01.
FDIC: The Federal Deposit Insurance Corporation, or any
successor thereto.
FHLMC: The Federal Home Loan Mortgage Corporation, or any
successor thereto.
Fidelity Bond: A fidelity bond to be maintained by the
Servicer pursuant to Section 4.12.
First Remittance Date: December 18, 1996.
Fitch: Fitch Investors Service, L.P., or any successor in
interest.
FNMA: Xxxxxx Xxx, or any successor thereto.
GNMA: The Government National Mortgage Association, a
wholly owned corporate instrumentality of the United States
Department of Housing and Urban Development.
Insurance Proceeds: With respect to each Mortgage Loan,
proceeds of insurance policies insuring the Mortgage Loan or the
related Mortgaged Property.
Xxxxxx Capital: Xxxxxx Capital, A Division of Xxxxxx
Brothers Holdings Inc., or any successor in interest.
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 of the principal balance of such Mortgage Loan at
origination, or such other date as is specified, to the lesser of
(a) the Appraised Value of the Mortgaged Property and (b) if the
Mortgage Loan was made to finance the acquisition of the related
Mortgaged Property, the purchase price of the Mortgaged Property,
expressed as a percentage.
Material Defect: As defined in Section 2.03.
Monthly Advance: The sum of the delinquent portions of
any Monthly Payments at the close of business on the Determination
Date required to be advanced by the Servicer pursuant to Section
5.03 on the Business Day immediately preceding the related
Remittance Date.
Monthly Payment: The scheduled monthly payment of
principal and interest on a Mortgage Loan.
Monthly Remittance Advice: The statement provided by the
Servicer to the Purchaser on or prior to each Remittance Date
pursuant to Section 5.02, in the form attached hereto as Exhibit X.
Xxxxx'x: Xxxxx'x Investors Service, or any successor in
interest.
Mortgage: The mortgage, deed of trust or other instrument
securing a Mortgage Note, which creates a first lien on an estate
in fee simple in real property securing the Mortgage Note.
Mortgage File: The items pertaining to a particular
Mortgage Loan referred to in Exhibit B annexed hereto, and any
additional documents required to be added to the Mortgage File
pursuant to this Agreement.
Mortgage Impairment Insurance Policy: A mortgage
impairment or blanket hazard insurance policy as described in
Section 4.11.
Mortgage Interest Rate: With respect to each Mortgage
Loan, the fixed annual rate of interest on a Mortgage Note.
Mortgage Loan: An individual Mortgage Loan that is the
subject of this Agreement, each such Mortgage Loan originally sold
and subject to this Agreement being identified on the Mortgage Loan
Schedule, which Mortgage Loan includes without limitation the
Mortgage File, the Monthly Payments, Principal Prepayments,
Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
REO Disposition Proceeds and all other rights, benefits, proceeds
and obligations arising from or in connection with such Mortgage
Loan.
Mortgage Loan Documents: The documents listed in Exhibit
C-1 hereto.
Mortgage Loan Schedule: A schedule of Mortgage Loans
annexed hereto as Exhibit A, such schedule setting forth the
following information with respect to each Mortgage Loan: (1) the
Company's Mortgage Loan identifying number; (2) the Mortgagor's
name; (3) the street address of the Mortgaged Property including
the state code; (4) a code indicating whether the Mortgaged
Property is a single family residence, 2-4 family residence,
condominium unit, or PUD; (5) the original months to maturity or
the remaining months to maturity from the 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; (6) the Loan-to-Value Ratio at origination;
(7) the Mortgage Interest Rate as of the Cut-off Date; (8) the date
that the first Monthly Payment was due; (9) the stated maturity
date; (10) the amount of the Monthly Payment; (11) the last payment
date on which a payment was actually applied to the outstanding
principal balance; (12) the original principal balance of the
Mortgage Loan; (13) the principal balance of the Mortgage Loan as
of the close of business on the Cut-off Date, after deduction of
payments of principal due on or before the Cut-off Date, whether or
not collected; (14) the Remittance Rate; (15) an indication of
whether the Mortgaged Property is owner-occupied, investment
property or a second home; (16) an indication whether the Mortgage
Loan was a -cash-out- refinance Mortgage Loan, a -rate-term-
Mortgage Loan, or a purchase money Mortgage Loan; and (17) an
indication of whether the Mortgage Loan is a Buydown Mortgage Loan.
With respect to the Mortgage Loans in the aggregate, the Mortgage
Loan Schedule 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 Interest Rate of the Mortgage Loans;
and (4) the weighted average remaining term to stated 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 securing repayment
of the debt evidenced by a Mortgage Note.
Mortgagor: The obligor on a Mortgage Note.
Nonrecoverable Advance: All or any portion of any Monthly
Advance previously made by the Servicer that, in the reasonable
judgment of the Servicer, will not be ultimately recoverable from
related Liquidation Proceeds, Insurance Proceeds, Condemnation
Proceeds or other amounts received with respect to the related
Mortgage Loan.
Officer's Certificate: A certificate signed by the
Chairman of the Board, the Vice Chairman of the Board, the
President or a Vice President and by the Treasurer or the Secretary
or one of the Assistant Treasurers or Assistant Secretaries of the
Company or the Servicer, as the case may be, and delivered to the
Purchaser as required by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may
be an employee of the Company or the Servicer, as the case may be,
(except that such counsel must be Independent (as defined in the
Trust Agreement) outside counsel with respect to any such opinion
relating to the REMIC Provisions), acceptable to the Purchaser.
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.
Prepayment Period: With respect to any Remittance Date,
the calendar month preceding the month in which such Remittance
Date occurs.
Primary Mortgage Insurance Policy: A policy of primary
mortgage guaranty insurance issued by a Qualified Insurer, as
required by this Agreement with respect to certain Mortgage Loans.
Prime Rate: The prime rate announced to be in effect from
time to time, as published by The Wall Street Journal.
Principal Balance: As to each Mortgage Loan, and for any
Due Date and the Due Period ending thereon, (i) the principal
balance of such Mortgage Loan outstanding at the Cut-off Date after
giving effect to payments of principal due on or before such date,
whether or not received, minus (ii) all amounts previously
distributed to the Purchaser (or that will be distributed on the
next succeeding Remittance Date) with respect to the related
Mortgage Loan representing payments or recoveries of principal or
advances in lieu thereof.
Principal Prepayment: Any payment or other recovery of
principal on a Mortgage Loan that 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.
PUD: Planned unit development.
Purchase Price and Terms Letter: The Purchase Price and
Terms Letter dated as of October 9, 1996 between the Purchaser and
the Company, as amended on October 29, 1996.
Purchaser: Xxxxxx Capital, or its successor in interest
or any assignee thereof under this Agreement as herein provided, or
of any such assignee.
Qualified GIC: A guaranteed investment contract or surety
bond providing for the investment of funds in a Custodial Account
and insuring a minimum, fixed or floating rate of return on
investments of such funds, which contract or surety bond shall:
a) be an obligation of an insurance company or
other corporation whose long-term debt rating is rated by each
Rating Agency in its highest rating category or, if such insurance
company has no long-term debt, whose claims paying ability is rated
by each Rating Agency in its highest rating category;
b) provide that the Servicer may exercise all of
the rights under such contract or surety bond without the necessity
of taking any action by any other Person;
c) provide that if at any time the then current
credit standing of the obligor under such guaranteed investment
contract is such that continued investment of funds pursuant to
such contract would result in a downgrading of any rating of the
Certificates, the Servicer shall terminate such contract without
penalty and be entitled to the return of all funds previously
invested thereunder, together with accrued interest thereon at the
interest rate provided under such contract to the date of delivery
of such funds to the Servicer;
d) provide that the Servicer's interest therein
shall be transferable to any successor servicer hereunder; and
e) provide that the funds reinvested thereunder and
accrued interest thereon be returnable to the related Collection
Account, not later than the Business Day prior to any Remittance
Date.
Qualified Insurer: A mortgage guaranty insurance company
duly authorized and licensed where required by law to transact
mortgage guaranty insurance business and approved as an insurer by
FNMA or FHLMC.
Qualifying Substitute Mortgage Loan: In the case of a
Mortgage Loan substituted for a Deleted Mortgage Loan, a Mortgage
Loan that, on the date of substitution, (i) has a Principal Balance
(together with that of any other mortgage loan substituted for the
same Deleted Mortgage Loan) as of the Due Date in the month in
which such substitution occurs not in excess of the Principal
Balance of the related Deleted Mortgage Loan as of such date (the
amount of any difference, plus one month's interest thereon at the
related Remittance Rate, to be remitted by the Company to the
Servicer for deposit in the Custodial Account pursuant to Section
4.04), (ii) has a Mortgage Interest Rate not less than, and not
more than one percentage point greater than, the Mortgage Interest
Rate of the related Deleted Mortgage Loan, (iii) has a Remittance
Rate not less than that of the related Deleted Mortgage Loan, (iv)
has a remaining term to stated maturity not longer than, and not
more than one year shorter than, the remaining term to stated
maturity of the related Deleted Mortgage Loan, (v) is, in the
reasonable determination of the Purchaser, of the same type,
quality and character as the related Deleted Mortgage Loan as if
the defect or breach had not occurred, and (vi) has a Loan-to-Value
Ratio as of the date of such substitution not greater than that of
the related Deleted Mortgage Loan.
Record Date: The close of business of the last Business
Day of the month preceding the month of the related Remittance
Date.
REMIC: A "real estate mortgage investment conduit" within
the meaning of Section 860D of the Code.
REMIC Provisions: The 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 18th day (or if such 18th day is not
a Business Day, the first Business Day immediately preceding such
day) of any month, beginning with the First Remittance Date.
Remittance Rate: With respect to each Mortgage Loan, the
annual rate of interest remitted to the Purchaser, which shall be
equal to the Mortgage Interest Rate for such Mortgage Loan minus
the Servicing Fee Rate.
REO Disposition: The final sale by the Servicer of any
REO Property.
REO Disposition Proceeds: All amounts received with
respect to an REO Disposition pursuant to Section 4.16.
REO Property: A Mortgaged Property acquired by the
Servicer on behalf of the Purchaser through foreclosure or by deed
in lieu of foreclosure, as described in Section 4.16.
Repurchase Price: With respect to any Mortgage Loan, a
price equal to (i) the Principal Balance of such Mortgage Loan plus
(ii) interest on such Principal Balance at the Remittance Rate from
the date to which interest has last been paid (to the extent
distributed to the Purchaser) to the date of repurchase, less
amounts received or advanced in respect of such repurchased
Mortgage Loan which are being held in the Custodial Account for
distribution in the month of repurchase.
S&P: Standard & Poor's Rating Services, a division of the
XxXxxx-Xxxx Companies, Inc., or any successor in interest.
SAIF: The Savings Association Insurance Fund, or any
successor thereto.
Securities Act: The Securities Act of 1933, as amended.
Servicer: Fleet Mortgage Corp., a South Carolina
corporation, or its successor in interest or assigns, or any
successor to the Servicer under this Agreement appointed as herein
provided.
Servicing Advances: All customary, reasonable and
necessary "out of pocket" costs and expenses other than Monthly
Advances (including reasonable attorneys' fees and disbursements)
incurred in the performance by the Servicer of its servicing
obligations, including, but not limited to, the cost of (a) the
preservation, restoration and protection of the Mortgaged Property,
(b) any enforcement or judicial proceedings, including
foreclosures, (c) the management and liquidation of any REO
Property and (d) compliance with the obligations under Sections
4.02 and 4.08.
Servicing Fee: With respect to each Mortgage Loan, the
amount of the monthly fee the Purchaser shall pay to the Servicer,
which shall be equal to one-twelfth of the product of (a) the
Servicing Fee Rate and (b) the outstanding principal balance of
such Mortgage Loan. Such fee shall be payable monthly, computed on
the basis of the same principal balance and period respecting which
any related interest payment on a Mortgage Loan is computed. The
obligation of the Purchaser to pay the Servicing Fee is limited to,
and the Servicing Fee is payable solely from, the interest portion
(including recoveries with respect to interest from Liquidation
Proceeds, to the extent permitted by Section 4.05) of each Monthly
Payment collected by the Servicer, or as otherwise provided under
Section 4.05.
Servicing Fee Rate: .25% per annum.
Servicing File: With respect to each Mortgage Loan, the
file retained by the Servicer consisting of originals of all
documents in the Mortgage File that are not delivered to the
Purchaser and copies of the Mortgage Loan Documents listed in
Exhibit C-1 the originals of which are delivered to the Purchaser
pursuant to Section 2.03.
Servicing Officer: Any officer of the Servicer involved
in or responsible for the administration and servicing of the
Mortgage Loans whose name appears on a list of servicing officers
furnished by the Servicer to the Purchaser upon request, as such
list may from time to time be amended.
Subservicer: Fleet Mortgage Group, Inc., a Rhode Island
corporation, or any successor in interest.
Subservicing Agreement: The agreement, dated as of
December 31, 1994, between the Servicer and the Subservicer
pursuant to which the Subservicer will service the Mortgage Loans
in a manner not inconsistent with the terms of this Agreement.
Trust: The trust fund established by the Trust Agreement,
the assets of which primarily consist of the Mortgage Loans.
Trust Agreement: The Trust Agreement dated as of November
1, 1996 between the Depositor and the Trustee.
Trustee: First Bank National Association, as Trustee
under the Trust Agreement, or its successor in interest or assigns.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; POSSESSION OF MORTGAGE FILES; BOOKS
AND RECORDS; DELIVERY OF DOCUMENTS
Section 2.01. Conveyance of Mortgage Loans; Possession of Mortgage
Files; Maintenance of Servicing Files. The Company, simultaneously with the
execution and delivery of this Agreement and subjectto the receipt by the
Company of the purchase price for the Mortgage Loans as set forth in the
Purchase Price and Terms Letter, doeshereby sell, transfer, assign, set over
and convey to the Purchaser, without recourse, but subject to the terms
of this Agreement, all the right, title and interest of the Company in and
to the Mortgage Loans on a servicing retained basis.
Pursuant to Section 2.03, the Company shall deliver the Mortgage Loan Documents
to the Purchaser (or its designee, including the Custodian) on or prior to the
Closing Date.
The contents of each Mortgage File not delivered to the
Purchaser (or its designee, including the Custodian) are and shall
be held in trust by the Servicer for the benefit of the Purchaser
as the owner thereof. The Servicer shall maintain a Servicing File
consisting of a copy of the contents of each Mortgage File and the
originals of the documents in each Mortgage File not delivered to
the Purchaser. The possession of each Servicing File by the
Servicer is at the will of the Purchaser for the sole purpose of
servicing the related Mortgage Loan, and such retention and
possession by the Servicer is in a custodial capacity only. Upon
the sale of the Mortgage Loans the ownership of each Mortgage Note,
the related Mortgage and the related Mortgage File and Servicing
File shall vest immediately in the Purchaser, and the ownership of
all records and documents with respect to the related Mortgage Loan
prepared by or which come into the possession of the Servicer shall
vest immediately in the Purchaser and shall be retained and
maintained by the Servicer, in trust, at the will of the Purchaser
and only in such custodial capacity. Each Servicing File shall be
segregated from the other books and records of the Servicer and
shall be marked appropriately to reflect clearly the sale of the
related Mortgage Loan to the Purchaser. The Servicer shall release
its custody of the contents of any Servicing File only in
accordance with written instructions from the Purchaser, unless
such release is required as incidental to the Servicer-s servicing
of the Mortgage Loans or is in connection with a repurchase of any
Mortgage Loan pursuant to Section 3.04 or Section 6.02.
Section 2.02. Books and Records; Transfers of Mortgage
Loans. From and after the sale of the Mortgage Loans to the
Purchaser all rights arising out of the Mortgage Loans including
but not limited to all funds received on or in connection with the
Mortgage Loan, shall be received and held by the Servicer in trust
for the benefit of the Purchaser as owner of the Mortgage Loans.
The sale of each Mortgage Loan shall be reflected on the
Company's balance sheet and other financial statements as a sale of
assets by the Company. The 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. The
Servicer shall maintain in its possession, available for inspection
during normal business hours by the Purchaser, or its designee,
upon reasonable written notice and shall deliver to the Purchaser
upon reasonable written notice, evidence of compliance
with all federal, state and local laws, rules and regulations. To
the extent that original documents are not required for purposes of
realization of Liquidation Proceeds or Insurance Proceeds,
documents maintained by the Servicer may be in the form of
microfilm or microfiche or such other reliable means of recreating
original documents, including but not limited to optical imagery
techniques.
The Servicer shall maintain with respect to each Mortgage
Loan and shall make available for inspection during normal business
hours upon reasonable written notice by the Purchaser or its
designee the related Servicing File during the time the Purchaser
retains ownership of a Mortgage Loan and thereafter in accordance
with applicable laws and regulations.
The Servicer shall keep at its office books and records
in which, subject to such reasonable regulations as it may
prescribe, the Servicer shall note transfers of Mortgage Loans. No
transfer of a Mortgage Loan may be made unless such transfer is in
compliance with the terms hereof. For the purposes of this
Agreement, the Servicer shall be under no obligation to deal with
any Person with respect to this Agreement or the Mortgage Loans
unless the books and records show such Person as the owner of the
Mortgage Loan. The Purchaser may, subject to the terms of this
Agreement, sell and transfer all or any portion of the Mortgage
Loans, provided that, the Servicer shall not be obligated to make
monthly remittances hereunder to more than four (4) owners of
Mortgage Loans at any one time. The Purchaser promptly shall
advise the Servicer of the transfer. Upon receipt of notice of the
transfer, the Servicer shall xxxx its books and records to reflect
the ownership of the Mortgage Loans of such assignee, and shall
release the previous Purchaser from its obligations hereunder with
respect to the Mortgage Loans sold or transferred. Upon receipt of
notice of any subsequent transfer of any Mortgage Loan, the
Servicer shall xxxx its books and records to reflect the ownership
of such Mortgage Loan by such subsequent transferee.
Section 2.03. Delivery of Documents. The Company shall
deliver and release to the Purchaser (or its designee) at least one
week prior to the Closing Date those Mortgage Loan Documents as
required by this Agreement with respect to each Mortgage Loan, a
list of which is attached as Exhibit C-1 hereto. Within 90 days
after the Closing Date, the Purchaser, or its designee, shall
review those Mortgage Loan Documents which were delivered by the
Company pursuant to this Section 2.03. Within 90 days of receipt
by the Company of any notice from the Purchaser (or its designee)
that any of the Mortgage Loan Documents is missing, does not appear
regular on its face (i.e., is mutilated, damaged, defaced, torn or
otherwise physically altered) or appears to be unrelated to the
Mortgage Loans identified in the Mortgage Loan Schedule which in
any such case materially and adversely affects the related Mortgage
Loan (each, a "Material Defect"), the Company shall cure such Material
Defect or, if it does not cure such Material Defect within such period,
repurchase the related Mortgage Loan at the Repurchase Price (or,
to the extent provided in Section 3.04, substitute one or more
Qualifying Substitute Mortgage Loans). Notwithstanding anything to
the contrary contained herein, the Purchaser shall not be obligated
to purchase any Mortgage Loan if the related original Mortgage Note
and original Assignment of Mortgage is not delivered to the
Purchaser (or its designee) prior to the Closing Date.
The Servicer shall forward to the Purchaser (or its
designee) original documents evidencing an assumption,
modification, consolidation or extension of any Mortgage Loan
entered into in accordance with Section 4.01 or Section 6.01 within
one week of their execution, provided, however, that the Servicer
shall provide the Purchaser with a certified true copy of any such
document submitted for recordation within one week of its
execution, and shall provide the original of any document submitted
for recordation or a copy of such document certified by the
appropriate public recording office to be a true and complete copy
of the original promptly upon receiving the same from the
appropriate public recording office.
ARTICLE III
REPRESENTATIONS AND WARRANTIES:
REMEDIES AND BREACH
Section 3.01. Company Representations and Warranties.
The Company represents and warrants to the Purchaser that as of the
Closing Date:
(a) Due Organization and Authority. The Company is a
federal savings bank duly organized, validly existing and in good
standing under the laws of the United States and has all licenses
necessary to carry on its business as now being conducted and is
licensed, qualified and in good standing in each state where a
Mortgaged Property is located if the laws of such state require
licensing or qualification in order to conduct business of the type
conducted by the Company; in any event the Company is in compliance
with the laws of any such state to the extent necessary to ensure
the enforceability of the related Mortgage Loan; the Company has
the full power and authority to execute and deliver this Agreement
and to perform in accordance herewith; the execution, delivery and
performance of this Agreement (including all instruments of
transfer to be delivered pursuant to this Agreement) by the Company
and the consummation of the transactions contemplated hereby have
been duly and validly authorized; assuming the due authorization,
execution and delivery hereof by the Purchaser and the Servicer,
this Agreement evidences the valid, binding and enforceable
obligation of the Company, subject, as to enforceability, to
bankruptcy, insolvency, reorganization or other similar laws
affecting creditors' rights and to general principles of equity
(regardless of whether the enforceability of this Agreement is
considered in a proceeding in equity or at law); and all requisite
corporate action has been taken by the Company to make this Agreement
valid and binding upon the Company in accordance with its terms;
(b) Ordinary Course of Business. The consummation of
the transactions contemplated by this Agreement are in the ordinary
course of business of the Company, and the transfer, assignment and
conveyance of the Mortgage Notes and the Mortgages by the Company
pursuant to this Agreement are not subject to the bulk transfer or
any similar statutory provisions in effect in any applicable
jurisdiction;
(c) No Conflicts. Neither the execution and delivery of
this Agreement, the origination or acquisition of the Mortgage
Loans by the Company, the sale of the Mortgage Loans to the
Purchaser or the other transactions contemplated hereby, nor the
fulfillment of or compliance with the terms and conditions of this
Agreement, conflicts with or will result in a breach of any of the
terms, conditions or provisions of the Company's charter or by-laws
or any legal restriction or any agreement or instrument to which
the Company is now a party or by which it is bound, or constitutes
a default or will 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 Company or its property is
subject, or impair the ability of the Purchaser to realize on the
Mortgage Loans, or impair the value of the Mortgage Loans;
(d) No Litigation Pending. There is no action, suit,
proceeding or investigation pending or, to the best of the
Company's knowledge, threatened against the Company which, either
in any one instance or in the aggregate, could reasonably be
expected to 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 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 Company
contemplated herein, or which would be likely to impair materially
the ability of the Company to perform under the terms of this
Agreement;
(e) No Consent Required. No consent, approval,
authorization or order of any court or governmental agency or body
is required for the execution, delivery and performance by the
Company of or compliance by the Company with this Agreement or the
sale of the Mortgage Loans as evidenced by the consummation of the
transactions contemplated by this Agreement, or if required, such
approval has been obtained prior to the Closing Date; provided,
however, that the Company makes no representation or warranty
regarding federal or state securities laws in connection with the
sale or distribution of the Certificates;
(f) Selection Process. The Mortgage Loans were selected
from among the outstanding fixed rate one- to four-family mortgage
loans in the Company's portfolio as to which the representations
and warranties set forth in Section 3.03 could be made and such
selection was not made in a manner so as to affect adversely the
interests of the Purchaser;
(g) Pool Characteristics. With respect to all of the
Mortgage Loans (and, as to any percentage of the Mortgage Loans or
Mortgaged Properties, with respect to the aggregate Principal
Balance of the Mortgage Loans as of the Cut-off Date), (a) no more
than (1.53%) are secured by real property improved by two- to
four-family dwellings; (b) no more than (2.80%) are secured by real
property improved by individual condominium units; (c) no more than
(11.24%) are secured by real property improved by an individual
unit in a planned unit development; (d) none are secured by shares
in cooperative units; (e) at least (84.596.4%) are secured by real
property with a detached one-family residence erected thereon or an
individual unit in a planned unit development; (f) no more than
(2.21.3%) of the Mortgaged Properties were owner-occupied second
homes or investor properties; (g) at least (97.898.7%) of the
Mortgaged Properties were owner-occupied primary residences; (h) no
Mortgage Loans had at origination a Loan-to-Value Ratio in excess
of (10095%); (i) the weighted average Loan-to-Value Ratio with
respect to all of the Mortgage Loans is not greater than (73.9460%)
at origination; (j) none of the Mortgage Loans were originated
under a limited documentation program; (k) approximately (4.69%) of
the Mortgage Loans were "cash-out" refinances, approximately
(63.14.5%) of the Mortgage Loans were rate-term refinances and
approximately (32.30.6%) of the Mortgage Loans were purchase money
mortgage loans; (l) no more than approximately (31.4150%) of the
Mortgaged Properties are located in the State of California; and
(m) all Mortgaged Properties (other than those located in
California) are geographically dispersed with not any one state
having more than (13.63%) of the Mortgaged Properties. The
Mortgage Loans were underwritten in accordance with the Company's
underwriting guidelines in effect at the time each Mortgage Loan as
originated (provided that the Company may have made exceptions to
its underwriting standards where there were compensating factors).
Each Mortgage and Mortgage Note is a FNMA/FHLMC uniform instrument
or was acceptable in form to FNMA or FHLMC as of the date of
origination of the related Mortgage Loan. The minimum Mortgage
Interest Rate on any Mortgage Loan is 4.75%, and the maximum
Mortgage Interest Rate on any Mortgage Loan is 16.7513.50%. No
more than 1.2( )% of the Mortgage Loans are secured by Mortgaged
Properties located in the same United States postal zip code. The
Mortgage Loans have a weighted average remaining term to stated
maturity of approximately 2710 months.
The maximum original principal balance of any Mortgage Loan was
($1,000,000) the minimum original principal balance for any
Mortgage Loan was ($17,400207,200) and the average original
principal balance of the Mortgage Loans was approximately
($251,741282,766.)
(h) No Untrue Information. The information concerning
the Company and the Mortgage Loans set forth in this Agreement,
including the exhibits hereto, and in any statement, report or
other document furnished or to be furnished by the Company pursuant
to this Agreement or in connection with the transactions
contemplated hereby is true, correct and complete in all material
respects;
(i) Sale Treatment. The disposition of the Mortgage
Loans pursuant to this Agreement will be treated by the Company for
financial accounting and reporting purposes as a sale of assets;
(j) Financial Statements. The Company has delivered to
the Purchaser financial statements as to the last two complete
fiscal years. All such financial statements fairly present the
pertinent results of operations and changes in financial position
at the end of each such period of the Company and its subsidiaries
and have been prepared in accordance with generally accepted
accounting principles consistently applied throughout the periods
involved, except as set forth in the notes thereto. In addition,
the Company has delivered information as to its conventional
mortgage loan delinquency and foreclosure experience for the
immediately preceding two-year period, in each case with respect to
mortgage loans owned by it and such mortgage loans serviced for
others during such period, and all such information so delivered is
true and correct in all material respects. There has been no
change in the business, operations, financial condition, properties
or assets of the Company since the date of the Company's financial
statements that would have a material adverse effect on its ability
to perform its obligations under this Agreement;
(k) No Brokers' Fees. The Company has not dealt with
any broker, investment banker, agent or other person that may be
entitled to any commission or compensation in connection with the
sale of the Mortgage Loans;
(l) Ability to Perform. The Company does not believe,
nor does it have any reason or cause to believe, that it cannot
perform each and every covenant contained in this Agreement; and
(m) Fair Consideration. The consideration received by
the Company upon the sale of the Mortgage Loans under this
Agreement constitutes fair consideration and reasonably equivalent
value for the Mortgage Loans.
Section 3.02. Servicer Representations and Warranties:
The Servicer represents and warrants to the Purchaser that as of
the Closing Date:
(a) Due Organization and Authority. The Servicer is a
corporation duly organized, validly existing and in good standing
under the laws of the State of South Carolina and has all licenses
necessary to carry on its business as now being conducted and is
licensed, qualified and in good standing in each state where a
Mortgaged Property is located if the laws of such state require
licensing or qualification in order to conduct business of the type
conducted by the Servicer; in any event the Servicer 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 Servicer has the full corporate power and
authority to execute and deliver this Agreement and to perform in
accordance herewith; the execution, delivery and performance of
this Agreement (including all instruments of transfer to be
delivered pursuant to this Agreement) by the Servicer and the
consummation of the transactions contemplated hereby to be
performed by the Servicer have been duly and validly authorized;
assuming the due authorization, execution and delivery hereof by
the Purchaser and the Company, this Agreement evidences the valid,
binding and enforceable obligation of the Servicer, subject, as to
enforceability, to bankruptcy, insolvency, reorganization or other
similar laws affecting creditors' rights and to general principles
of equity (regardless of whether the enforceability of this
Agreement is considered in a proceeding in equity or at law); and
all requisite corporate action has been taken by the Servicer to
make this Agreement valid and binding upon the Servicer in
accordance with its terms;
(b) Ordinary Course of Business. The consummation of
the transactions contemplated by this Agreement to be performed by
the Servicer are in the ordinary course of business of the
Servicer;
(c) No Conflicts. Neither the execution and delivery of
this Agreement or the other transactions contemplated hereby, nor
the fulfillment of or compliance with the terms and conditions of
this Agreement, conflicts with or will result in a breach of any of
the terms, conditions or provisions of the Servicer-s certificate
of incorporation or by-laws or any legal restriction or any
agreement or instrument to which the Servicer is now a party or by
which it is bound, or constitutes a default or will 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 Servicer or its property is subject, or impair the ability of
the Purchaser to realize on the Mortgage Loans, or impair the value
of the Mortgage Loans;
(d) Ability to Service. Each of the Servicer and the
Subservicer is an approved seller/servicer of conventional
residential mortgage loans for FNMA or FHLMC. The Servicer
directly or through the Subservicer has the facilities,
procedures, and experienced personnel necessary for the servicing,
in accordance with Accepted Servicing Practices, of mortgage loans
of the same type as the Mortgage Loans. Each of the Servicer and
the Subservicer is in good standing to service mortgage loans for
FNMA or FHLMC, and no event has occurred, including but not limited
to a change in insurance coverage, which would make the Servicer or
the Subservicer unable to comply with FNMA or FHLMC eligibility
requirements or which would require notification to either FNMA or
FHLMC;
(e) No Litigation Pending. There is no action, suit,
proceeding or investigation pending or, to the best of the
Servicer's knowledge, threatened against the Servicer which, either
in any one instance or in the aggregate, could reasonably be
expected to result in any material adverse change in the business,
operations, financial condition, 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 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 Servicer
contemplated herein, or which would be likely to impair materially
the ability of the Servicer to perform under the terms of this
Agreement;
(f) No Consent Required. No consent, approval,
authorization or order of any court or governmental agency or body
is required for the execution, delivery and performance by the
Servicer of or compliance by the Servicer with this Agreement or
the consummation of the transactions contemplated by this Agreement
to be performed by the Servicer, or if required, such approval has
been obtained prior to the Closing Date; provided, however, that
the Servicer makes no representation or warranty regarding federal
or state securities laws in connection with the sale or
distribution of the Certificates;
(g) No Untrue Information. The information concerning
the Servicer and the Mortgage Loans set forth in this Agreement,
including the exhibits hereto, and in any statement, report or
other document furnished or to be furnished by the Servicer
pursuant to this Agreement or in connection with the transactions
contemplated hereby is or will be true, correct and complete in all
material respects;
(h) Financial Statements. The Servicer has delivered to
the Purchaser or the Company consolidated financial statements as
to the last two complete fiscal years. All such financial
statements fairly present the pertinent results of operations and
changes in financial position at the end of each such period of the
Servicer and its parent and subsidiaries and have been prepared in
accordance with generally accepted accounting principles
consistently applied throughout the periods involved, except as set
forth in the notes thereto. In addition, the Servicer has
delivered information as to its conventional mortgage loan delinquency
and foreclosure experience for the immediately preceding two-year period,
in each case with respect to mortgage loans owned by it and such mortgage
loans serviced for others during such period, and all such information so
delivered is true and correct in all material respects. There has been no
change in the business, operations, financial condition, properties
or assets of the Servicer since the date of the Servicer's financial
statements that would have a material adverse effect on
its ability to perform its obligations under this Agreement;
(i) Reasonable Servicing Fee. The Servicer acknowledges
and agrees that the Servicing Fee, as calculated at the Servicing
Fee Rate, represents reasonable compensation for performing such
services and that the entire Servicing Fee shall be treated by the
Servicer, for accounting and tax purposes, as compensation for the
servicing and administration of the Mortgage Loans pursuant to this
Agreement;
(j) Ability to Perform. The Servicer does not believe,
nor does it have any reason or cause to believe, that it cannot
perform each and every covenant made by it in this Agreement; and
(k) Servicing. From and after the date on which a
Mortgage Loan became subject to the terms and provisions of that
certain Servicing Agreement dated as of April 28, 1995 by and
between the Servicer and the Company (the -Prior Servicing
Agreement-) each such Mortgage Loan has been serviced in accordance
with Accepted Servicing Practices and in material compliance with
the terms and provisions of the Prior Servicing Agreement.
Section 3.03. Representations and Warranties Regarding
Individual Mortgage Loans. As to each Mortgage Loan, the Company
hereby represents and warrants to the Purchaser that as of the
Closing Date:
(a) Mortgage Loans as Described. The information set
forth with respect to the Mortgage Loans on the Mortgage Loan
Schedule provides an accurate listing of the Mortgage Loans, and
the information with respect to each Mortgage Loan on the Mortgage
Loan Schedule is true and correct in all material respects at the
date or dates respecting which such information is given;
(b) Payments Current. All payments required to be made,
up to and including the Due Date immediately preceding the Cut-off
Date, for each Mortgage Loan under the terms of the related
Mortgage Note have been made, and no payment required to be made
under any Mortgage Loan has been delinquent by more than thirty
days more than one time within the twelve months preceding the
Cut-off Date;
(c) No Outstanding Charges. There are no defaults in
complying with the terms of any Mortgage, 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 that remains unpaid and that has been assessed but is not
yet due and payable. 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 any Mortgage Loan, except for
interest accruing from the date of the related Mortgage Note or
date of disbursement of the Mortgage Loan proceeds, whichever is
later, to the day which precedes by one month the Due Date of the
first installment of principal and interest;
(d) No Defenses. No Mortgage Note is 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 any Mortgage Note or Mortgage, or the exercise
of any right thereunder, render such Mortgage Note or 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 the time the Mortgage Loan
was originated;
(e) 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
pursuant to insurance policies conforming to the requirements of
Section 4.10. If, upon origination of the Mortgage Loan, the
Mortgaged Property was in an area identified in the Federal
Register by the Federal Emergency Management Agency as having
special flood hazards (and such flood insurance has been made
available), a flood insurance policy meeting the requirements of
the current guidelines of the federal Flood Insurance
Administration is in effect, which policy conforms to the
requirements of Section 4.10. 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. Each 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, each 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 the common facilities of a planned
unit development or condominium. Each 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 Company has not engaged in,
and has no knowledge of any Mortgagor's having engaged in, any act
or omission that would impair the coverage of any such policy, the
benefits of the endorsement provided for herein, or the validity
and binding effect of either, 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;
(f) Compliance with Applicable Laws. Any and all
requirements of any federal, state or local law, including, without
limitation, usury, truth-in-lending, real estate settlement
procedures, consumer credit protection, equal credit opportunity or
disclosure laws applicable to each Mortgage Loan have been complied
with, and the Company shall make or cause to be made available upon
reasonable notice for the Purchaser's inspection, evidence of
compliance with all such requirements;
(g) No Satisfaction of Mortgage. Each 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;
(h) Valid First Lien. Each Mortgage evidences a valid,
subsisting, enforceable and perfected first lien on the related
Mortgaged Property, including all improvements on the Mortgaged
Property. The lien of the Mortgage is subject only to:
1) liens of current real property taxes and assessments
not yet due and payable, and, if the related Mortgaged Property is
a condominium unit, any lien for common charges permitted by
statute;
2) covenants, conditions and restrictions, rights of
way, easements and other matters of public record as of the date of
recording of such Mortgage acceptable to mortgage lending
institutions in the area in which the related Mortgaged Property is
located or specifically referred to in the lender-s title insurance
policy or attorney-s opinion of title and abstract of title
delivered to the originator of such Mortgage Loan; and
3) other matters to which like properties are commonly
subject which do not, individually or in the aggregate, 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 a valid, subsisting and enforceable first lien on the
property described therein and the Company has full right to sell
and assign the same to the 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.
(i) Validity of Mortgage Documents. Each Mortgage Note
and the related Mortgage are genuine, and each is the legal, valid
and binding obligation of the maker thereof, enforceable in
accordance with its terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization or other similar
laws affecting the enforcement of creditors' rights generally and
by general equity principles (regardless of whether such
enforcement is considered in a proceeding in equity or at law).
All parties to each Mortgage Note and the related Mortgage and any
other related agreement had legal capacity to enter into the
Mortgage Loan and to execute and deliver such Mortgage Note and
Mortgage and any other related agreement, and each Mortgage Note
and Mortgage has been duly and properly executed by such parties;
(j) Ownership. Immediately prior to the sale of the
Mortgage Loans by the Company to the Purchaser pursuant to this
Agreement, the Company was the sole owner and holder of each
Mortgage Loan, each Mortgage Loan was not assigned or pledged, and
the Company had good and marketable title thereto, and had full
right to transfer and sell each Mortgage Loan to the Purchaser free
and clear, except as described in paragraph (h) above, 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 this
Agreement. Immediately prior to the sale of the Mortgage Loans by
the Company to the Purchaser pursuant to this Agreement, either the
Company was the sole owner of record of each Mortgage Loan or the
Servicer, for the benefit of the Company and as the Company-s
nominee, was the sole record holder of each Mortgage Loan;
(k) LTV; Primary Mortgage Insurance Policy. No Mortgage
Loan has a Loan-to-Value Ratio at origination (or, if any Mortgage
Loan has been the subject of a significant modification since
origination, other than as a result of a default or imminent
default, as of the date of such modification) greater than 95%.
Except for the Mortgage Loans set forth on Exhibit I, the original
LTV of the Mortgage Loan either was not more than 80% or the excess
over 75% is and will be insured as to payment defaults by a Primary
Mortgage Insurance Policy meeting the requirements of Section 4.15
until the LTV of such Mortgage Loan is reduced to 80%. All Primary
Mortgage Insurance Policies shall insure at least 30% of the principal
balance of the related Mortgage Loan at origination if the LTV is between
95.00% and 90.01%, at least 25% of such balance if the LTV is between 90.00%
and 85.01%, and at least 12% of such balance if the LTV is between
85.00% and 80.01%. All provisions of such Primary Mortgage
Insurance Policy have been and are being complied with, such policy
is in full force and effect, and all premiums due thereunder have
been paid. No action, inaction, or event has occurred and no state
of facts exists that has, or will result in the exclusion from,
denial of, or defense to coverage. Any Mortgage Loan subject to a
Primary Mortgage Insurance Policy obligates the Mortgagor
thereunder to maintain the Primary Mortgage Insurance Policy and to
pay all premiums and charges in connection therewith. The Mortgage
Interest Rate for the Mortgage Loan as set forth on the Mortgage
Loan Schedule is net of any such insurance premium;
(l) Title Insurance. Each Mortgage Loan is covered by
either (i) an attorney's opinion of title and abstract of title the
form and substance of which is generally acceptable to mortgage
lending institutions originating mortgage loans in the locality
where the related Mortgaged Property is located or (ii) an ALTA
mortgagee title insurance policy or other generally acceptable form
of policy of insurance acceptable to FNMA or FHLMC, issued by a
title insurer acceptable to FNMA or FHLMC and qualified to do
business in the jurisdiction where the related Mortgaged Property
is located, insuring, subject to the exceptions listed in paragraph
(h) above, the Company, and its successors and assigns, as to the
first priority lien of the Mortgage in the original principal
amount of the Mortgage Loan. If the Mortgaged Property is a
condominium unit located in a state in which a title insurer will
generally issue an endorsement, then the related title insurance
policy contains an endorsement insuring the validity of the
creation of the condominium form of ownership with respect to the
project in which such unit is located. Where required by state law
or regulation, the Mortgagor has been given the opportunity to
choose the carrier of the required mortgagee title insurance.
Additionally, such mortgagee title insurance policy affirmatively
insures ingress and egress, and against encroachments by or upon
the Mortgaged Property or any interest therein. The Company is the
named insured and the sole insured of such mortgagee title
insurance policy, the assignment to the Purchaser of the Company's
interest in such mortgagee title insurance policy does not require
the consent of or notification to the insurer (or if such consent
or notification is required, such consent has been received, or
such notification has been given), and such mortgagee title
insurance policy is in full force and effect and will be in force
and effect and will inure to the benefit of the Purchaser upon the
consummation of the transactions contemplated
by this Agreement. No claims have been made under such mortgagee
title insurance policy, and no prior holder of the Mortgage,
including the Company, has done, by act or omission, anything that
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;
(m) Mortgaged Property Undamaged; No Defaults. No
foreclosure action is being threatened or commenced with respect to
any Mortgage Loan. There is no proceeding pending or threatened
for the total or partial condemnation of any Mortgaged Property.
Each 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 related Mortgage Loan or the use for which the premises
were intended. There is no default, breach, violation or event of
acceleration existing under any 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 of acceleration, and neither the Company
nor its predecessors have waived any default, breach, violation or
event of acceleration;
(n) 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 any Mortgaged Property which are
or may be liens prior to, or equal or coordinate with, the lien of
the related Mortgage;
(o) Loan Origination. Each Mortgage Loan was originated
by a savings and loan association, savings bank, commercial bank,
credit union, insurance company, or similar institution which is
supervised and examined by a Federal or State authority, or by a
mortgagee approved by the Secretary of Housing and Urban
Development pursuant to sections 203 and 211 of the National
Housing Act. 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 as necessary to make the information
and statements therein not misleading. The originator of each
Mortgage Loan was in compliance with any and all applicable "doing
business" and licensing requirements in the jurisdiction in which
the related Mortgaged Property was located when such party
originated such Mortgage Loan;
(p) Interest Accrual. Each mortgage loan provides for
accrual of interest on the basis of a 360-day year consisting of
twelve 30-day months.
(q) Original Terms Unmodified. The terms of each
Mortgage Note and Mortgage have not been impaired, waived, altered
or modified in any respect, except by a written instrument which
has been recorded, if necessary to protect the interests of the
Purchaser and which have been delivered to Purchaser (or its
designee) prior to the Closing Date. The substance of any such
waiver, alteration or modification has been approved by the issuer
of any related Primary Mortgage Insurance Policy and the title
insurer, to the extent required by the related policy, and its
terms are reflected on the Mortgage Loan Schedule. No Mortgagor
has been released, in whole or in part, from the obligations
imposed by the terms of the related Mortgage Note, and no Mortgaged
Property has been released, in whole or in part, from the lien of
the related Mortgage, except in connection with an assumption
agreement approved by the issuer of any related Primary Mortgage
Insurance Policy and the title insurer, to the extent required by
the related policy, and which assumption agreement is part of the
related Mortgage Loan File and the terms of which are reflected in
the Mortgage Loan Schedule;
(r) Location and Type of Mortgaged Property. Each
Mortgaged Property is located in the state identified in the
Mortgage Loan Schedule and consists of a parcel of real property
with a detached single family residence erected thereon, or a two-
to four-family dwelling, or an individual condominium unit in a
low-rise condominium project, or an individual unit in a planned
unit development, provided, however, that any condominium project,
or planned unit development shall conform with the Company-s
underwriting guidelines in effect at the time that such Mortgage
Loan was originated regarding such dwellings, and no residence or
dwelling is a mobile home or a manufactured dwelling. No portion
of any Mortgaged Property is or has been used for commercial
purposes;
(s) Full Disbursement of Proceeds. Each Mortgage Loan
has been closed and the proceeds of each 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 each Mortgage Loan and the
recording of the related Mortgage were paid, and the related
Mortgagor is not entitled to any refund of any amounts paid or due
under such Mortgage Note or Mortgage;
(t) Doing Business. All parties that have had any
interest in any 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 related Mortgaged Property is located, and (2)
organized under the laws of such state, or (3) qualified to do
business in such state, or (4) federal savings and loan
associations or national banks having principal offices in such
state, or (5) not doing business in such state;
(u) Location of Improvements; No Encroachments. All
improvements located on or being part of each Mortgaged Property
lie wholly within the boundaries and building restriction lines of
such Mortgaged Property (and, if such Mortgaged Property is a
condominium unit, such improvements lie wholly within the project)
and no improvements on adjoining properties encroach upon such
property. As of the date of origination of the Mortgage Loan, no
improvement located on or being part of the Mortgaged Property was
in violation of any applicable zoning law or regulation;
(v) Payment Terms. Each Mortgage Note is payable each
month in equal monthly installments of principal and interest with
the exception of the final Monthly Payment scheduled thereunder
which may differ in a non-material amount, 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, with a
principal balance at origination of no more than $1,000,000. The
stated remaining term of each Mortgage Loan is between 36( ) and
357( ) months.
(w) Customary Provisions. Each Mortgage contains
customary and enforceable provisions such as to render the rights
and remedies of the holder thereof adequate for the realization
against the related 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
related Mortgaged Property pursuant to the proper procedures, the
holder of such Mortgage Loan will be able to deliver good and
merchantable title to the related Mortgaged Property. There is no
homestead or other exemption available to a Mortgagor that would
interfere with the ultimate sale of the related Mortgaged Property
at a trustee's sale or the right to foreclose the Mortgage;
(x) Occupancy of the Mortgaged Property. As of the date
on which each Mortgage Loan was originated, the related Mortgaged
Property was 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 each
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. Except as set forth on the Mortgage
Loan Schedule, each Mortgagor represented at the time of
origination of the related Mortgage
Loan that such Mortgagor would occupy the related Mortgaged
Property as such Mortgagor's primary residence;
(y) No Additional Collateral. Each 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 (h) above;
(z) Deeds of Trust. In the event any Mortgage
constitutes a deed of trust, a trustee, duly qualified under
applicable law to serve as such, has been properly designated and
currently so serves and is named in such Mortgage, and no fees or
expenses are or will become payable by the Company, or any assignee
or transferee thereof, to the trustee under the deed of trust,
except in connection with a trustee's sale after default by the
related Mortgagor;
(aa) Delivery of Mortgage Documents. Each Mortgage Note,
the related Mortgage, the related Assignment of Mortgage and any
other documents required to be delivered with respect to each
Mortgage Loan by the Company as set forth in Exhibit C-1 attached
hereto have been delivered, in accordance with Section 2.03 hereof,
to the Purchaser (or its designee). The Company or the Servicer,
as the case may be, is in possession of a complete, true and
accurate Mortgage File with respect to each Mortgage Loan in
compliance with Exhibit B, except for such documents the originals
of which have been delivered to the Purchaser (or its designee);
(bb) Transfer of Mortgage Loans. Each Assignment of
Mortgage is in recordable form and is acceptable for recording
under the laws of the jurisdiction in which the related Mortgaged
Property is located;
(cc) Due on Sale. Each Mortgage contains an enforceable
provision (to the extent not prohibited by law) for the
acceleration of the payment of the unpaid principal balance of the
related Mortgage Loan in the event that the related Mortgaged
Property is sold or transferred without the prior written consent
of the Mortgagee thereunder;
(dd) Buydown Provisions; No Graduated Payments or
Contingent Interests. No more than 0( )% of the Mortgage Loans (by
Principal Balance) are Buydown Mortgage Loans. Each Buydown
Mortgage Loan has been fully funded. No Mortgage Loan is a
graduated payment mortgage loan and no Mortgage Loan has a shared
appreciation or other contingent interest feature;
(ee) Consolidation of Future Advances. None of the
Mortgage Loans contain any provisions permitting future advances
after the Cut-off Date. Any future advances made prior to the
Cut-off Date have been consolidated with the outstanding principal
amount secured by the related 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 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 FNMA and FHLMC. In each case,
the consolidated principal amount does not exceed the original
principal amount of the Mortgage Loan;
(ff) Collection and Origination Practices; Escrow
Deposits. The origination and collection practices used with
respect to each Mortgage Loan have been in accordance with Accepted
Servicing Practices, and have been in all respects in compliance
with all applicable laws and regulations. With respect to escrow
deposits and Escrow Payments, if any, all such payments are in the
possession of, or under the control of, the Company or 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 compliance with
state and federal law. With respect to each Mortgage Loan that
provides for Escrow Payments and where Escrow Payments have been
collected, an escrow of funds is not prohibited by applicable law
and has been established in accordance with Accepted Servicing
Practices. No escrow deposits or Escrow Payments or other charges
or payments due the Company have been capitalized under the
Mortgage or the Mortgage Note. Any interest required to be paid
pursuant to state and local law has been properly paid and
credited;
(gg) Appraisal. Each Mortgage File contains an appraisal
of the related Mortgaged Property signed prior to the approval of
the related Mortgage Loan application by an appraiser who had no
direct or indirect interest in the related Mortgaged Property and
who meets the minimum qualifications of FNMA and FHLMC for
appraisers, on a form approved by FNMA or FHLMC with such riders as
have been approved by FNMA or FHLMC, as the case may be;
(hh) Soldiers' and Sailors' Relief Act. No Mortgagor has
notified the Company of, and the Company has no knowledge of, any
relief requested or allowed to any Mortgagor under the Soldiers'
and Sailors' Civil Relief Act of 1940;
(ii) No Construction Loans. No Mortgage Loan was made in
connection with facilitating the trade-in or exchange of a
Mortgaged Property;
(jj) Adverse Conditions. The Company knows of no
condition or event with respect to any Mortgage Loan which
reasonably could cause it to expect that such Mortgage Loan shall
become delinquent or that the value of such Mortgage Loan will
otherwise be adversely affected;
(kk) No Release. No Mortgage Loan requires the Mortgagee
thereunder to release any portion of the related Mortgaged Property
from the lien of the related Mortgage other than upon payment in
full of such Mortgage Loan;
(ll) Condominiums/Planned Unit Developments. If any
Mortgaged Property is a condominium unit or a planned unit
development (other than a de minimis planned unit development) such
condominium or planned unit development project meets the Company-s
underwriting guidelines that were in effect at the time of
origination of the related Mortgage Loan;
(mm) REMIC Qualification. Each Mortgage Loan is a
"qualified mortgage" within the meaning of Section 860G of the Code
and Treas. Reg. ^U1.860G-2.
(nn) No Violation of Environmental Laws. There is no
pending action or proceeding directly involving any Mortgaged
Property of which the Company is aware in which compliance with any
environmental law, rule or regulation is an issue; and to the best
of the Company-s knowledge, 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.
(oo) 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 FNMA.
(pp) Servicing. From and after the date of origination,
each Mortgage Loan has been serviced in accordance with Accepted
Servicing Practices in all respects, and the Servicer has complied
in all material respects with the provisions relative to the
servicing and administration of each Mortgage Loan as such
provisions are set forth in the Prior Servicing Agreement.
(qq) Legal Proceedings. No Mortgaged Property is subject
to foreclosure, litigation, bankruptcy or insolvency proceedings or
any workout or foreclosure agreement, and, to the best of the
Company-s knowledge, the filing of a bankruptcy or insolvency
proceeding that would result in such Mortgage Loan becoming subject
to bankruptcy or insolvency proceedings is not imminent.
Section 3.04. Remedies for Breach of Representations and
Warranties. It is understood and agreed that the representations
and warranties set forth in Sections 3.01, 3.02, and 3.03 shall
survive the sale of the Mortgage Loans to the Purchaser and the
subsequent sale of the Mortgage Loans by the Purchaser to the
Depositor and by the Depositor to the Trustee, and the delivery of
the Mortgage Loan Documents to the Purchaser (or its designee) 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 the Company, the Servicer or the
Purchaser of a breach of any of the foregoing representations and
warranties which materially and adversely affects the value of the
Mortgage Loans or the interests of the Purchaser (or which
materially and adversely affects the interests of the Purchaser in
the related Mortgage Loan in the case of a representation and
warranty relating to a particular Mortgage Loan), the party discovering
such breach shall give prompt written notice to the other parties.
With respect to a breach of any representation or
warranty set forth in Sections 3.01 or 3.03, within 90 days of the
earlier of either discovery by or notice to the Company of any
breach of any such representation or warranty which materially and
adversely affects the value of the Mortgage Loans or the interests
of the Purchaser, or which materially and adversely affects the
interest of the Purchaser in the related Mortgage Loan in the case
of a representation and warranty relating to the Mortgage Loans,
the Company shall use its best efforts promptly to cure such breach
in all material respects and, if such breach cannot be cured, the
Company shall repurchase the affected Mortgage Loan at the
Repurchase Price.
In the event that a breach shall involve any
representation or warranty set forth in Section 3.01, and such
breach cannot be cured within 60 days of the earlier of either
discovery by or notice to the Company of such breach, then, if such
breach materially and adversely affects the value of any Mortgage
Loan or the interests of the Purchaser in any Mortgage Loan, the
Company shall repurchase such affected Mortgage Loan at the
Repurchase Price.
The Company may, within 90 days following the earlier of
discovery by or notice to the Company of any such breach of Section
3.03, at its option and subject to the provisions described below,
and provided that the Company has a Qualifying 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 one or more Qualifying Substitute Mortgage
Loans, provided that no such substitution shall be made (i) after
the two year period beginning on the Closing Date and (ii) unless
the Purchaser has received an Opinion of Counsel (at the expense of
the Company) that such substitution will not adversely affect the
status of any REMIC established pursuant to the Trust Agreement as
a REMIC or cause any such REMIC to be deemed to have engaged in a
"prohibited transaction" under the REMIC Provisions. If the
Company has no Qualifying 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
Section 3.04 shall be accomplished by the Company remitting to the
Servicer for deposit in the Custodial Account the amount of the
Repurchase Price for distribution to 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 which
amount shall be remitted to the Company.
At the time of repurchase or substitution, the Purchaser
and the Company shall arrange for the reassignment of
the Deleted Mortgage Loan to the Company and the delivery to the
Company of any documents held by the Purchaser relating to the
Deleted Mortgage Loan. In the event of a repurchase or
substitution, the Company shall, simultaneously with such
reassignment, give written notice to the Purchaser and the Servicer
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 one or more Qualifying Substitute Mortgage
Loans and amend the Mortgage Loan Schedule to reflect the addition
of such Qualifying Substitute Mortgage Loan to this Agreement. In
connection with any such substitution, the Company shall be deemed
to have made as to such Qualifying Substitute Mortgage Loan the
representations and warranties set forth in this Agreement except
that all such representations and warranties set forth in this
Agreement with respect to each Mortgage Loan shall be deemed made
as to such Qualifying Substitute Mortgage Loan as of the date of
such substitution. The Company shall effect such substitution by
delivering to the Purchaser for such Qualifying Substitute Mortgage
Loan the documents required by the Trust Agreement, with the
Mortgage Note endorsed as required by the Trust Agreement. No
substitution will be made in any calendar month after the
Determination Date for such month. The Company shall remit to the
Servicer for deposit in the Custodial Account the Monthly Payment
due on such Qualifying Substitute Mortgage Loan or Loans in the
month following the date of such substitution. Monthly Payments
due with respect to Qualifying Substitute Mortgage Loans in the
month of substitution less the related Servicing Fee shall be
remitted to the Company by the Servicer. For the month of
substitution, distributions to Purchaser shall include the Monthly
Payment due on any Deleted Mortgage Loan in the month of
substitution, and the Company shall thereafter be entitled to
retain all amounts subsequently received by the Company in respect
of such Deleted Mortgage Loan.
For any month in which the Company substitutes a
Qualifying Substitute Mortgage Loan for a Deleted Mortgage Loan,
the Company shall determine the amount (if any) by which the
aggregate principal balance of all Qualifying Substitute Mortgage
Loans as of the date of substitution is less than the aggregate
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 remitted by the Company to
the Servicer for deposit in the Custodial Account at the time of
such substitution.
In addition to such repurchase or substitution
obligation, the Company shall promptly reimburse the Purchaser for
any expenses reasonably incurred by the Purchaser in enforcing its
remedies hereunder in connection with any breach by the Company of
any representation or warranty set forth in this
Agreement. It is understood and agreed that the obligations of the
Company set forth in this Section 3.04 to cure, substitute for or
repurchase a defective Mortgage Loan and to reimburse the Purchaser
as provided in this Section 3.04 constitute the sole remedies of
the Purchaser respecting a breach of the foregoing representations
and warranties.
Any cause of action against the Company relating to or
arising out of the breach of any representations and warranties
made in Sections 3.01 and 3.03 shall accrue as to any Mortgage Loan
upon failure by the Company to cure such breach or repurchase such
Mortgage Loan as specified above.
With respect to a breach of any representation or
warranty set forth in Section 3.02, the Servicer shall indemnify
the Purchaser and hold it harmless against any losses, damages,
penalties, fines, forfeitures, reasonable and necessary legal fees
and related costs, judgments, and other cost and expenses resulting
from any claim, demand, defense or assertion based on or grounded
upon, or resulting from, a breach of the Servicer representations
and warranties contained in Section 3.02 of this Agreement.
ARTICLE IV
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 4.01. Servicer to Act as Servicer. The
Servicer, as an independent contractor, shall service and
administer the Mortgage Loans and shall have full power and
authority, acting alone or through a Subservicer, to do, or cause
to be done, any and all things in connection with such servicing
and administration which the Servicer may deem necessary or
desirable, consistent with the terms of this Agreement and with
Accepted Servicing Practices.
Consistent with the terms of this Agreement, the Servicer
may waive any late payment charge, assumption fee or other fee that
may be collected in the ordinary course of servicing the Mortgage
Loans. The Servicer shall not make any future advances to any
obligor under any Mortgage Loan and (unless the Mortgagor is in
default with respect to the Mortgage Loan or such default is, in
the judgment of the Servicer, imminent) the Servicer shall not
permit any modification of any material term of any Mortgage Loan,
including any modification that would change the Mortgage Interest
Rate, defer or forgive the payment of principal or interest, reduce
or increase the outstanding principal balance (except for actual
payments of principal) or change the final maturity date on such
Mortgage Loan. In the event of any such modification which permits
the deferral of interest or principal payments on any Mortgage
Loan, the Servicer shall, on the Business Day immediately preceding
the Remittance Date in any month in which any such principal or
interest payment has been deferred, make a Monthly Advance in
accordance with Section 5.03, in an amount equal to the difference
between (a) such month's principal and one month's
interest at the Remittance Rate on the unpaid principal balance of
such Mortgage Loan and (b) the amount paid by the Mortgagor. The
Servicer shall be entitled to reimbursement for such advances to
the same extent as for all other advances made pursuant to Section
5.03. Without limiting the generality of the foregoing, the
Servicer shall continue, and is hereby authorized and empowered, to
execute and deliver on behalf of itself and the Purchaser, all
instruments of satisfaction or cancellation, or of partial or full
release, discharge and all other comparable instruments, with
respect to the Mortgage Loans and with respect to the Mortgaged
Properties. Upon the request of the Servicer, the Purchaser shall
furnish the Servicer with any powers of attorney and other
documents necessary or appropriate to enable the Servicer to carry
out its servicing and administrative duties under this Agreement.
In servicing and administering the Mortgage Loans, the
Servicer shall employ procedures (including collection procedures)
and exercise the same care that it customarily employs and
exercises in servicing and administering mortgage loans for its own
account, giving due consideration to Accepted Servicing Practices
where such practices do not conflict with the requirements of this
Agreement.
The Mortgage Loans may be subserviced by the Subservicer
in accordance with the servicing provisions of this Agreement on
behalf of the Servicer, provided that the Subservicer is a
FNMA-approved lender or a FHLMC seller/servicer in good standing,
and no event has occurred, including but not limited to a change in
insurance coverage, which would make it unable to comply with the
eligibility requirements for lenders imposed by FNMA or for
seller/servicers imposed by FHLMC, or which would require
notification to FNMA or FHLMC. The Servicer may perform any of its
servicing responsibilities hereunder or may cause the Subservicer
to perform any such servicing responsibilities on its behalf, but
the use by the Servicer of the Subservicer shall not release the
Servicer from any of its obligations hereunder and the Servicer
shall remain responsible hereunder for all acts and omissions of
the Subservicer as fully as if such acts and omissions were those
of the Servicer. Any monies received by the Subservicer in respect
of any Mortgage Loan shall be deemed to have been received by the
Servicer whether or not actually received by it. The Servicer
shall pay all fees and expenses of the Subservicer from its own
funds, and the Subservicer's fee shall not exceed the Servicing
Fee.
References in this Agreement to performance by the
Servicer of its servicing responsibilities hereunder shall be
deemed to include the Subservicer acting on behalf of the Servicer.
At the cost and expense of the Servicer, without any
right of reimbursement from the Custodial Account, the Servicer
shall be entitled to terminate the rights and responsibilities of
the Subservicer and arrange for any servicing responsibilities to
be performed by a successor Subservicer meeting the requirements in
the second preceding paragraph and approved by the Purchaser in
writing (which approval shall not be unreasonably withheld),
provided, however, that nothing contained herein shall be deemed to
prevent or prohibit the Servicer, at the Servicer's option, from
electing to service the related Mortgage Loans itself. In the
event that the Servicer's responsibilities and duties under this
Agreement are terminated pursuant to Section 8.04, 9.01 or 10.01,
the Servicer shall at its own cost and expense terminate the rights
and responsibilities of the Subservicer as soon as is reasonably
possible. The Servicer shall pay all fees, expenses or penalties
necessary in order to terminate the rights and responsibilities of
the Subservicer from the Servicer's own funds without reimbursement
from the Purchaser.
The Servicer shall be entitled to enter into an agreement
with the Subservicer for indemnification of the Servicer by the
Subservicer and nothing contained in this Agreement shall be deemed
to limit or modify such indemnification.
Any Subservicing Agreement and any other transactions or
services relating to the Mortgage Loans involving the Subservicer
shall be deemed to be between the Subservicer and Servicer alone,
and the Purchaser shall have no obligations, duties or liabilities
with respect to the Subservicer including no obligation, duty or
liability of Purchaser to pay the Subservicer's fees and expenses.
For purposes of distributions and advances by the Servicer pursuant
to this Agreement, the Servicer shall be deemed to have received a
payment or other recovery in respect of a Mortgage Loan when the
Subservicer has received such payment or recovery.
Section 4.02. Liquidation of Mortgage Loans. In the
event that any payment due under any Mortgage Loan and not deferred
pursuant to Section 4.01 is not paid when the same becomes due and
payable, or in the event the Mortgagor fails to perform any other
covenant or obligation under the Mortgage Loan and such failure
continues beyond any applicable grace period, the Servicer shall
take such action as (1) the Servicer would take under similar
circumstances with respect to a similar mortgage loan held for its
own account for investment, (2) shall be consistent with Accepted
Servicing Practices, and (3) is consistent with any related Primary
Mortgage Insurance Policy.
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 reasonable cause
to believe that a Mortgaged Property is contaminated by such
hazardous or toxic substances or wastes identified as such pursuant
to any local, state or federal environmental law, rule or
regulation, or if the Purchaser otherwise requests an environmental
inspection, an inspection of such Mortgaged Property shall be conducted
by a qualified inspector. Upon completion of such inspection, the Servicer
shall promptly provide the Purchaser with a written report of such
environmental inspection.
In the event that the environmental inspection report
indicates that the Mortgaged Property is contaminated by hazardous
or toxic substances or wastes, the Servicer shall not proceed with
foreclosure or acceptance of a deed in lieu of foreclosure, and the
Servicer shall be reimbursed for all Servicing Advances made with
respect to the related Mortgaged Property from the Custodial
Account pursuant to Section 4.05 hereof.
Section 4.03. Collection of Mortgage Loan Payments.
Continuously from the date hereof until the principal and interest
on all Mortgage Loans are paid in full, the Servicer shall proceed
diligently to collect all payments due under each of the Mortgage
Loans when the same shall become due and payable and shall
ascertain and estimate Escrow Payments and all other charges that
will become due and payable with respect to the Mortgage Loan and
the Mortgaged Property consistent with Accepted Servicing
Practices, to the end that the installments payable by the
Mortgagors will be sufficient to pay such charges as and when they
become due and payable.
Section 4.04. Establishment of and Deposits to Custodial
Account. The Servicer shall segregate and hold all funds collected
and received pursuant to a Mortgage Loan separate and apart from
any of its own funds and general assets and shall establish and
maintain one or more Custodial Accounts, in the form of time
deposit or demand accounts, titled "Fleet Mortgage Corp., in trust
for Xxxxxx Capital, A Division of Xxxxxx Brothers Holdings Inc.,"
or such other designation as the Purchaser may direct. The
Custodial Account shall be an Eligible Account. Any funds
deposited in the Custodial Account may be invested in Eligible
Investments. Funds deposited in the Custodial Account may be
withdrawn by the Servicer in accordance with Section 4.05. The
creation of any Custodial Account shall be evidenced by a
certification substantially in the form of Exhibit D-1 hereto, in
the case of an account established with the Servicer or an
affiliate thereof, or by a letter agreement substantially in the
form of Exhibit D-2 hereto, in the case of an account held by a
depository other than the Servicer or an affiliate thereof. A copy
of such certification or letter agreement shall be furnished to the
Purchaser and, upon request, to any subsequent Purchaser.
Funds in a Custodial Account may be invested in Eligible
Investments which shall mature not later than the earlier of the
Business Day immediately preceding the next succeeding Remittance
Date, and such Eligible Investments shall not be sold or disposed
of prior to their maturity. All income and gain realized from any
investment shall be for the benefit of the Servicer and shall be
subject to its withdrawal or order from
time to time. The amount of any losses incurred in respect of any
such investments shall be deposited in the related Custodial
Account by the Servicer out of its own funds immediately as such
loss is realized.
The Servicer shall deposit in the Custodial Account on a
daily basis, as received, and retain therein, the following
collections received by the Servicer and payments made by the
Servicer after the Cut-off Date, other than payments of principal
and interest due on or before the Cut-off Date:
(i) all payments on account of principal on the Mortgage
Loans, including all Principal Prepayments;
(ii) all payments on account of interest on the Mortgage
Loans adjusted to the Remittance Rate;
(iii) all Liquidation Proceeds;
(iv) all Insurance Proceeds including amounts required to
be deposited pursuant to Section 4.10 (other than proceeds to be
held in the Escrow Account and applied to the restoration or repair
of the Mortgaged Property or released to the Mortgagor in
accordance with Section 4.14) and Section 4.11;
(v) all Condemnation Proceeds which are not applied to
the restoration or repair of the Mortgaged Property;
(vi) any amount (without duplication) required to be
deposited in the Custodial Account pursuant to Sections 4.01, 4.16,
5.03, 6.01 or 6.02;
(vii) any amounts received by the Servicer payable in
connection with the repurchase of any Mortgage Loan pursuant to
Section 3.04 and all amounts received by the Servicer which are
required to be deposited by the Servicer in connection with a
shortfall in principal amount of any Qualifying Substitute Mortgage
Loan pursuant to Section 3.04;
(viii) with respect to each Principal Prepayment
received during the immediately preceding Prepayment Period, an
amount (to be paid by the Servicer out of its funds as provided in
Section 6.03 hereof) which, when added to all amounts allocable to
interest received in connection with such Principal Prepayment,
equals one month's interest on the amount of principal so prepaid
at the Remittance Rate, the aggregate of such payments by the
Servicer for any month not to exceed the aggregate of the
Servicer's Servicing Fees for such month;
(ix) any amounts required to be deposited by the Servicer
into the Custodial Account pursuant to Section 4.11 in connection
with the deductible clause in any blanket hazard insurance policy;
and
(x) any amounts received with respect to or related to
any REO Property and all REO Disposition Proceeds pursuant to
Section 4.16.
The foregoing requirements for deposit into the Custodial
Account shall be exclusive, it being understood and agreed that,
without limiting the generality of the foregoing, payments in the
nature of late payment charges and assumption
fees, need not be deposited by the Servicer into the Custodial
Account. Any interest paid on funds deposited in the Custodial
Account by the depository institution shall accrue to the benefit
of the Servicer and the Servicer shall be entitled to retain and
withdraw such interest from the Custodial Account pursuant to
Section 4.05.
Section 4.05. Permitted Withdrawals From Custodial
Account. The Servicer shall, from time to time, withdraw funds
from the Custodial Account for the following purposes:
(i) to make payments to the Purchaser in the amounts and
in the manner provided for in Section 5.01;
(ii) to reimburse itself for Monthly Advances of the
Servicer's funds made pursuant to Section 5.03, the Servicer's
right to reimburse itself pursuant to this subclause (ii) being
limited to amounts received on the related Mortgage Loan which
represent late payments of principal and/or interest respecting
which any such advance was made, related Liquidation Proceeds,
Insurance Proceeds, Condemnation Proceeds, REO Property, and such
other amounts as may be collected by the Servicer from the
Mortgagor or otherwise relating to such Mortgage Loan, it being
understood that, in the case of any such reimbursement, the
Servicer's right thereto shall be prior to the rights of Purchaser,
except that, where the Servicer is required to repurchase a
Mortgage Loan pursuant to Section 6.02, the Servicer's right to
such reimbursement shall be subsequent to the payment to the
Purchaser of the Repurchase Price pursuant to such sections and all
other amounts required to be paid to the Purchaser with respect to
such Mortgage Loan;
(iii) to reimburse itself for unreimbursed Servicing
Advances, and for any unpaid Servicing Fees, the Servicer's right
to reimburse itself pursuant to this subclause (iii) with respect
to any Mortgage Loan being limited to related Liquidation Proceeds,
Condemnation Proceeds, Insurance Proceeds, REO Disposition Proceeds
and other amounts received in respect of the related REO Property,
and such other amounts as may be collected by the Servicer from the
Mortgagor or otherwise relating to the Mortgage Loan, it being
understood that, in the case of any such reimbursement, the
Servicer's right thereto shall be prior to the rights of the
Purchaser except where the Servicer is required to repurchase a
Mortgage Loan pursuant to Section 6.02, in which case the
Servicer's right to such reimbursement shall be subsequent to the
payment to the Purchaser of the Repurchase Price pursuant to such
sections and all other amounts required to be paid to the Purchaser
with respect to such Mortgage Loan;
(iv) to reimburse itself for any Nonrecoverable Advance;
(v) to pay itself investment earnings on funds deposited
in the Custodial Account;
(vi) to reimburse itself for expenses incurred and
reimbursable to it pursuant to Section 8.01 or Section 8.03;
(vii) to pay any amount required to be paid pursuant
to Section 4.16 related to any REO Property (including recordation
expenses incurred in connection with a foreclosure proceeding and
the reasonable costs of obtaining any Opinion of Counsel described
in Section 4.16), it being understood that in the case of any such
expenditure or withdrawal related to a particular REO Property, the
amount of such expenditure or withdrawal from the Custodial Account
shall be limited to amounts on deposit in the Custodial Account
with respect to the related REO Property;
(viii) to withdraw funds deposited in error in the
Custodial Account; and
(ix) to clear and terminate the Custodial Account upon
the termination of this Agreement.
Section 4.06. Establishment of and Deposits to Escrow
Account. The Servicer shall segregate and hold all funds collected
and received pursuant to a Mortgage Loan constituting Escrow
Payments separate and apart from any of its own funds and general
assets and shall establish and maintain one or more Escrow
Accounts, in the form of time deposit or demand accounts, titled,
"Fleet Mortgage Corp., in trust for Xxxxxx Capital, A Division of
Xxxxxx Brothers Holdings Inc." The Escrow Accounts shall be
Eligible Accounts. Funds deposited in the Escrow Account may be
drawn on by the Servicer in accordance with Section 4.07. The
creation of any Escrow Account shall be evidenced by a
certification substantially in the form of Exhibit E-1 hereto, in
the case of an account established with the Servicer, or by a
letter agreement substantially in the form of Exhibit E-2 hereto,
in the case of an account held by a depository other than the
Servicer. A copy of such certification or letter, as applicable,
shall be furnished to the Purchaser upon request.
The Servicer shall deposit in the Escrow Account or
Accounts on a daily basis, and retain therein:
(i) all Escrow Payments collected on account of the
Mortgage Loans, for the purpose of effecting timely payment of any
such items as required under the terms of this Agreement and the
related Mortgage Notes; and
(ii) all amounts representing Insurance Proceeds or
Condemnation Proceeds which are to be applied to the restoration or
repair of any Mortgaged Property pursuant to Section 4.14.
The Servicer shall make withdrawals from the Escrow
Account only to effect such payments as are required under this
Agreement, as set forth in Section 4.07. The Servicer shall be
entitled to retain any interest paid on funds deposited in the
Escrow Account by the depository institution, other than interest
on escrowed funds required by law to be paid to the Mortgagor. To
the extent required by law, the Servicer shall pay interest on
escrowed funds to the Mortgagor notwithstanding that the Escrow
Account may be non-interest bearing or that interest paid thereon
is insufficient for such purposes.
Section 4.07. Permitted Withdrawals From Escrow Account.
Withdrawals from the Escrow Account or Accounts may be made by the
Servicer only:
(i) to effect timely payments of items constituting
Escrow Payments for the related Mortgage;
(ii) to reimburse the Servicer for any Servicing Advances
made by the Servicer pursuant to Section 4.08 with respect to a
related Mortgage Loan, but only from amounts received on the
related Mortgage Loan which represent late collections of Escrow
Payments thereunder;
(iii) to refund to any Mortgagor any funds found to
be in excess of the amounts required under the terms of the related
Mortgage Loan;
(iv) for transfer to the Custodial Account and
application to reduce the principal balance of the Mortgage Loan in
accordance with the terms of the related Mortgage and Mortgage
Note;
(v) for application to restoration or repair of the
Mortgaged Property in accordance with the procedures outlined in
Section 4.14;
(vi) to pay to the Servicer, or any Mortgagor to the
extent required by law, any interest paid on the funds deposited in
the Escrow Account;
(vii) for application of Buydown Funds in accordance
with the terms of any Buydown Mortgage Loan;
(viii) to withdraw funds deposited in error in the
Escrow Account; and
(ix) to clear and terminate the Escrow Account on the
termination of this Agreement.
Section 4.08. Payment of Taxes, Insurance and Other
Charges. With respect to each Mortgage Loan, the Servicer shall
maintain accurate records reflecting the status of any ground
rents, taxes, assessments, water rates, sewer rents, and other
charges which are or may become a lien upon the Mortgaged Property
and the status of the Private Mortgage Insurance Policy premium and
fire, flood and hazard insurance coverage and shall obtain, from
time to time, all bills for the payment of such charges (including
renewal premiums) and shall effect payment thereof prior to the
applicable penalty or termination date, employing for such purpose
deposits of the Mortgagor in the Escrow Account which shall have
been estimated and accumulated by the Servicer in amounts
sufficient for such purposes, as allowed under the terms of the
Mortgage or applicable law. To the extent that a Mortgage does not
provide for Escrow Payments, the Servicer shall make a Servicing
Advance from its own funds to effect such payment upon notice that
payment of such amounts is due and unpaid.
Section 4.09. Protection of Accounts. The Servicer may
transfer the Custodial Account or the Escrow Account to a different
Eligible Account from time to time.
Section 4.10. Maintenance of Hazard Insurance. The
Servicer shall cause to be maintained for each Mortgage Loan hazard
insurance such that all buildings upon the Mortgaged Property are
insured by an insurer that satisfies the requirements of FNMA or
FHLMC against loss by fire, hazards of extended coverage and such
other hazards as are customary in the area where the Mortgaged
Property is located, in an amount that is not less than the
replacement value of the improvements securing such Mortgage Loan
or the unpaid principal balance of such Mortgage Loan, whichever is
less.
If upon origination of the Mortgage Loan, the related
Mortgaged Property was located in an area identified in the Federal
Register by the Flood Emergency Management Agency as having special
flood hazards (and such flood insurance has been made available
under the National Flood Insurance Program) a flood insurance
policy meeting the requirements of the current guidelines of the
federal Flood Insurance Administration is in effect with a
generally acceptable insurance carrier that satisfies the
requirements of FNMA or FHLMC in an amount representing coverage
equal to the corresponding amount required by FNMA as set forth in
the FNMA Mortgage-Backed Securities Selling and Servicing Guide or
by FHLMC as set forth in the FHLMC Sellers' and Servicers' Guide.
If a Mortgage is secured by a unit in a condominium, the
Servicer shall verify that the coverage required of the owner's
association, including hazard, flood, liability, and fidelity
coverage, is being maintained in accordance with then current FNMA
or FHLMC requirements, and secure from the owner's association its
agreement to notify the Servicer promptly of any change in the
insurance coverage or of any condemnation or casualty loss that may
have a material effect on the value of the property as security.
All policies required hereunder shall name the Servicer
as loss payee and shall be endorsed with standard mortgagee
clauses, which shall provide for at least 30 days prior written
notice of any cancellation, reduction in amount or material change
in coverage.
The Servicer shall not accept any such insurance policies
from insurance companies unless such companies satisfy the
requirements of FNMA or FHLMC and are licensed to do business in
the jurisdiction in which the Mortgaged Property is located. The
Servicer shall determine that such policies provide sufficient risk
coverage and amounts, that they insure the property owner, and that
they properly describe the property address. The Servicer shall
furnish to the Mortgagor a formal notice of expiration of any such
insurance in sufficient time for the Mortgagor to arrange for renewal
coverage by the expiration date.
Pursuant to Section 4.04, any amounts collected by the
Servicer under any such policies (other than amounts to be
deposited in the Escrow Account and applied to the restoration or
repair of the related Mortgaged Property, or property acquired in
liquidation of the Mortgage Loan, or to be released to the
Mortgagor in accordance with the terms of the related Mortgage
Note, in accordance with the Servicer's normal servicing procedures
as specified in Section 4.14) shall be deposited in the Custodial
Account subject to withdrawal pursuant to Section 4.05.
Section 4.11. Maintenance of Mortgage Impairment
Insurance. In the event that the Servicer shall obtain and
maintain a blanket policy insuring against losses arising from fire
and hazards covered under extended coverage on all of the Mortgage
Loans, then, to the extent such policy provides coverage in an
amount equal to the amount required pursuant to Section 4.10 and
otherwise complies with all other requirements of Section 4.10, it
shall conclusively be deemed to have satisfied its obligations as
set forth in Section 4.10. Any amounts collected by the Servicer
under any such policy relating to a Mortgage Loan shall be
deposited in the Custodial Account subject to withdrawal pursuant
to Section 4.05. Such policy may contain a deductible clause, in
which case, in the event that there shall not have been maintained
on the related Mortgaged Property a policy complying with Section
4.10, and there shall have been a loss which would have been
covered by such policy, the Servicer shall deposit in the Custodial
Account at the time of such loss the amount not otherwise payable
under the blanket policy because of such deductible clause, such
amount to be deposited from the Servicer's funds, without
reimbursement therefor. Upon request of the Purchaser, the
Servicer shall cause to be delivered to the Purchaser a certified
true copy of such policy and a statement from the insurer
thereunder that such policy shall in no event be terminated or
materially modified without 30 days' prior written notice to such
Purchaser.
Section 4.12. Maintenance of Fidelity Bond and Errors
and Omissions Insurance. The Servicer shall maintain, at its own
expense, a blanket Fidelity Bond and an Errors and Omissions
Insurance Policy, with broad coverage on all officers, employees or
other persons acting in any capacity requiring such persons to
handle funds, money, documents or papers relating to the Mortgage
Loans ("Servicer Employees"). Any such Fidelity Bond and Errors
and Omissions Insurance Policy shall be in the form of the Mortgage
Banker's Blanket Bond and shall protect and insure the Servicer
against losses, including forgery, theft, embezzlement, fraud,
errors and omissions and negligent acts of such Servicer Employees.
Such Fidelity Bond and Errors and Omissions Insurance Policy also
shall protect and insure the Servicer against losses
in connection with the release or satisfaction of a Mortgage Loan
without having obtained payment in full of the indebtedness secured
thereby. No provision of this Section 4.12 requiring such Fidelity
Bond and Errors and Omissions Insurance Policy shall diminish or
relieve the Servicer from its duties and obligations as set forth
in this Agreement. The minimum coverage under any such bond and
insurance policy shall be at least equal to the corresponding
amounts that the Servicer is required to carry pursuant to the
Servicer-s agreement with FNMA or FHLMC. Upon the request of the
Purchaser, the Servicer shall cause to be delivered to the
Purchaser a certified true copy of such fidelity bond and insurance
policy and a statement from the surety and the insurer that such
fidelity bond and insurance policy shall in no event be terminated
or materially modified without 30 days' prior written notice to the
Purchaser.
Section 4.13. Inspections. Within 60 days after a
Mortgagor fails to make a Monthly Payment which failure is not
cured the Servicer shall inspect the Mortgaged Property and shall
conduct subsequent inspections in accordance with Accepted
Servicing Practices or as may be required by the primary mortgage
guaranty insurer. The Servicer shall keep a record of each such
inspection.
Section 4.14. Restoration of Mortgaged Property. The
Servicer need not obtain the approval of the Purchaser prior to
releasing any Insurance Proceeds or Condemnation Proceeds to the
Mortgagor to be applied to the restoration or repair of the
Mortgaged Property if such release is in accordance with Accepted
Servicing Practices and the terms of the related Mortgage Note. At
a minimum, the Servicer shall comply with the following conditions
in connection with any such release of Insurance Proceeds or
Condemnation Proceeds:
(i) the Servicer shall receive satisfactory independent
verification of completion of repairs and issuance of any required
approvals with respect thereto;
(ii) the Servicer shall take all steps necessary to
preserve the priority of the lien of the Mortgage, including, but
not limited to requiring waivers with respect to mechanics' and
materialmen's liens; and
(iii) pending repairs or restoration, the Servicer
shall place the Insurance Proceeds or Condemnation Proceeds in the
Escrow Account.
If the Purchaser is named as an additional loss payee,
the Servicer is hereby empowered to endorse any loss draft issued
in respect of such a claim in the name of the Purchaser.
Section 4.15. Maintenance of Primary Mortgage Insurance;
Claims. Except for the Mortgage Loans identified on Exhibit I
attached hereto, each Mortgage Loan with a LTV at origination in
excess of 80%, the Servicer shall, without any cost to the
Purchaser, maintain or cause the Mortgagor to maintain in full
force and effect a Primary Mortgage Insurance Policy issued by a
mortgage insurance company acceptable to FNMA or FHLMC.
The Servicer shall pay or cause the Mortgagor to pay the
premium thereon on a timely basis, until (a) the related Mortgage
Loan is satisfied, (b) the following conditions are met: the
Servicer has received a written request to cancel the related
Primary Mortgage Insurance Policy and such cancellation is
consistent with Accepted Servicing Practices, which, at a minimum,
shall include the following conditions: (1) the related Mortgage
Loan is current, (2) the related Mortgage Loan has not been more
than 30 days delinquent in the 12-month period that precedes the
request, and (3) the Mortgagor obtains at his or her cost, a new
appraisal that indicates that the outstanding principal balance of
the related Mortgage Loan is below 80% of the current appraised
value of the Mortgaged Property, or (c) such time and on such
conditions as applicable law requires that the Primary Mortgage
Insurance Policy be canceled. In the event that such Primary
Mortgage Insurance Policy shall be terminated, the Servicer shall
obtain from another Qualified Insurer a comparable replacement
policy, with a total coverage equal to the remaining coverage of
such terminated Primary Mortgage Insurance Policy. If the insurer
shall cease to be a Qualified Insurer, the Servicer shall determine
whether recoveries under the Primary Mortgage Insurance Policy are
jeopardized for reasons related to the financial condition of such
insurer, it being understood that the Servicer shall in no event
have any responsibility or liability for any failure to recover
under the Primary Mortgage Insurance Policy for such reason. If
the Servicer determines that recoveries are so jeopardized, it
shall notify the Purchaser and the Mortgagor, if required, and
obtain from another Qualified Insurer a replacement insurance
policy. The Servicer shall not take any action which would result
in noncoverage under any applicable Primary Mortgage Insurance
Policy of any loss which, but for the actions of the Servicer would
have been covered thereunder. In connection with any assumption or
substitution agreement entered into or to be entered into pursuant
to Section 6.01, the Servicer shall promptly notify the insurer
under the related Primary Mortgage Insurance Policy, if any, of
such assumption or substitution of liability in accordance with the
terms of such Primary Mortgage Insurance Policy and shall take all
actions which may be required by such insurer as a condition to the
continuation of coverage under such Primary Mortgage Insurance
Policy. If such Primary Mortgage Insurance Policy is terminated as
a result of such assumption or substitution of liability, the
Servicer shall obtain a replacement Primary Mortgage Insurance
Policy as provided above.
In connection with its activities as servicer, the
Servicer agrees to prepare and present, on behalf of itself and the
Purchaser, claims to the insurer under any Primary Mortgage
Insurance Policy in a timely fashion in accordance with the terms
of such Primary Mortgage Insurance Policy and, in this regard, to
take such action as shall be necessary to permit recovery under any
Primary Mortgage Insurance Policy respecting a defaulted Mortgage
Loan. Pursuant to Section 4.04, any amounts collected by the
Servicer under any Primary Mortgage Insurance Policy shall be
deposited in the Custodial Account, subject to withdrawal pursuant
to Section 4.05.
Section 4.16. Title Management and Disposition of REO
Property. In the event that title to any Mortgaged Property is
acquired in foreclosure or by deed in lieu of foreclosure, the deed
or certificate of sale shall be taken in the name of the Purchaser,
or in the event the Purchaser is not authorized or permitted to
hold title to real property in the state where the REO Property is
located, or would be adversely affected under the "doing business"
or tax laws of such state by so holding title, the deed or
certificate of sale shall be taken in the name of such Person or
Persons as shall be consistent with an Opinion of Counsel obtained
by the Servicer from any attorney duly licensed to practice law in
the state where the REO Property is located. The Person or Persons
holding such title other than the Purchaser shall acknowledge in
writing that such title is being held as nominee for the Purchaser.
The Servicer shall manage, conserve, protect and operate
each REO Property for the Purchaser 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 accordance with Accepted Servicing
Practices. 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 Purchaser.
The Servicer shall dispose of any REO Property as soon as
possible and shall sell such REO Property in any event within two
years after title has been taken to such REO Property, unless (i)
the Purchaser shall have been supplied with an Opinion of Counsel
to the effect that the holding by the Trust of such Mortgaged
Property subsequent to such two-year period (and specifying the
period beyond such two-year period for which the Mortgaged Property
may be held) will not result in the imposition of taxes on
"prohibited transactions" of the Trust as defined in section 860F
of the Code, or cause the related REMIC to fail to qualify as a
REMIC, in which case the Trust may continue to hold such Mortgaged
Property (subject to any conditions contained in such Opinion of
Counsel), or (ii) the Purchaser (at the Servicer's expense) or the
Servicer shall have applied for, prior to the expiration of such
two-year period, an extension of such two-year period in the manner
contemplated by section 856(e)(3) of the Code, in which case the
two-year period shall be extended by the applicable period. If a
period longer than two years is permitted under the foregoing sentence
and is necessary to sell any REO Property, (i) the Servicer shall report
monthly to the Purchaser as to the progress being made in selling such
REO Property and (ii) if, with the written consent of the Purchaser, a
purchase money mortgage is taken in connection with such sale, such
purchase money mortgage shall name the Servicer as mortgagee, and
such purchase money mortgage shall not be held pursuant to this
Agreement, but instead a separate participation agreement between
the Servicer and Purchaser shall be entered into with respect to
such purchase money mortgage.
Notwithstanding any other provision of this Agreement, no
Mortgaged Property held by a REMIC shall be rented (or allowed to
continue to be rented) or otherwise used for the production of
income by or on behalf of the Trust or sold in such a manner or
pursuant to any terms that would (i) cause such Mortgaged Property
to fail to qualify at any time as "foreclosure property" within the
meaning of section 860G(a)(8) of the Code, (ii) subject the Trust
to the imposition of any federal or state income taxes on "net
income from foreclosure property" with respect to such Mortgaged
Property within the meaning of section 860G(c) of the Code, or
(iii) cause the sale of such Mortgaged Property to result in the
receipt by the Trust of any income from non-permitted assets as
described in section 860F(a)(2)(B) of the Code, unless the Servicer
has agreed to indemnify and hold harmless the Trust with respect to
the imposition of any such taxes.
The Servicer shall also maintain on each REO Property
fire and hazard insurance with extended coverage in an amount which
is at least equal to the maximum insurable value of the
improvements which are a part of such property, liability insurance
and, to the extent required and available under the Flood Disaster
Protection Act of 1973, as amended, flood insurance in the amount
required above.
The disposition of REO Property shall be carried out by
the Servicer. The Servicer shall promptly notify the Purchaser,
for approval, of any bonafide, commercially reasonable offer it
receives for an REO Property. If the Purchaser does not object to
such offer within ten (10) days after written receipt thereof, then
the Purchaser shall be deemed to have approved such offer. The
proceeds of sale of the REO Property shall be promptly deposited in
the Custodial Account. As soon as practical thereafter the
expenses of such sale shall be paid and the Servicer shall
reimburse itself for any related unreimbursed Servicing Advances,
unpaid Servicing Fees and unreimbursed Monthly Advances made
pursuant to Section 5.03, and on the Remittance Date immediately
following the Prepayment Period in which such sale proceeds are
received the net cash proceeds of such sale remaining in the Custodial
Account shall be distributed to the Purchaser.
The Servicer shall reimburse itself from the Custodial
Account, pursuant to the provisions of Section 4.05, funds
necessary for the proper operation, management and maintenance of
each REO Property, including the cost of maintaining any hazard
insurance pursuant to Section 4.10 and the fees of any managing
agent of the Servicer or the Servicer itself. The REO management
fee shall be an amount that is reasonable and customary in the area
where the Mortgaged Property is located. The net cash flow from
the REO Property (which shall equal the revenues from such REO
Property net of the expenses described in this Section 4.16 and of
any reserves reasonably required from time to time to be maintained
to satisfy anticipated liabilities for such expenses) shall be
deposited in the Custodial Account pursuant to Section 4.04.
Section 4.17. Real Estate Owned Reports. Together with
the statement furnished pursuant to Section 5.02, the Servicer
shall furnish to the Purchaser on or before the Remittance Date
each month a statement with respect to any REO Property covering
the operation of such REO Property for the previous month and the
Servicer's efforts in connection with the sale of such REO Property
and any rental of such REO Property incidental to the sale thereof
for the previous month. That statement shall be accompanied by
such other information as the Purchaser shall reasonably request.
The reasonable and documented out-of-pocket cost of providing such
additional information shall be borne by the Purchaser.
Section 4.18. Liquidation Reports. Upon the foreclosure
sale of any Mortgaged Property or the acquisition thereof by the
Purchaser pursuant to a deed in lieu of foreclosure, the Servicer
shall submit to the Purchaser a liquidation report with respect to
such Mortgaged Property.
Section 4.19. Reports of Foreclosures and Abandonments
of Mortgaged Property. Following the foreclosure sale or
abandonment of any Mortgaged Property, the Servicer shall report
such foreclosure or abandonment as required pursuant to Section
6050J of the Code.
ARTICLE V
PAYMENTS TO PURCHASER
Section 5.01. Remittances. On each Remittance Date the
Servicer shall remit by wire transfer of immediately available
funds to the Purchaser the sum of (a) all amounts deposited in the
Custodial Account as of the close of business on the Determination
Date (net of charges against or withdrawals from the Custodial
Account pursuant to Section 4.05), and (b) all amounts, if any,
which the Servicer is obligated to deposit into the Custodial
Account pursuant to Section 5.03, but not including (i) any amounts
attributable to Principal Prepayments received after the
immediately preceding Prepayment Period, (ii) any
Liquidation Proceeds and Insurance Proceeds received after the
immediately preceding Prepayment Period, and (iii) any amounts
attributable to Monthly Payments collected but due on a Due Date or
Dates subsequent to the related Due Period, all of which amounts,
together with any additional interest required to be deposited into
a Custodial Account in connection with a Principal Prepayment in
accordance with Section 4.04(viii), shall be remitted on the next
succeeding Remittance Date.
With respect to any remittance received by the Purchaser
after the second Business Day following the Remittance Date on
which such payment was due, the Servicer shall pay to the Purchaser
interest on any such late payment at an annual rate equal to the
Prime Rate, adjusted as of the date of each change, plus two
percentage points, but in no event greater than maximum amount
permitted by applicable law. Such interest shall be deposited in
the Custodial Account by the Servicer on the date such late payment
is made and shall cover the period commencing with the day
following such second Business Day and ending with the Business Day
on which such payment is made, both inclusive. Such interest shall
be remitted along with the distribution payable on the next
succeeding Remittance Date. The payment by the Servicer of any
such interest shall not be deemed an extension of time for payment
or a waiver of any Event of Default by the Servicer.
Section 5.02. Statements to Purchaser. Not later than
the Remittance Date, the Servicer shall furnish to the Purchaser
(or its designee) a Monthly Remittance Advice, with a trial balance
report attached thereto, in the form of Exhibit F annexed hereto,
and an electronic tape, computer diskette or other electronic data
transmission in a format agreed to by the Servicer and the
Purchaser, containing the information set forth in Exhibit G
hereto, as to the preceding remittance and the period ending on the
related Determination Date.
In addition, not more than 60 days after the end of each
calendar year, the Servicer shall furnish to the Trustee an annual
statement in accordance with the requirements of applicable federal
income tax law as to the aggregate of remittances for the
applicable portion of such year.
Such obligation of the Servicer shall be deemed to have
been satisfied to the extent that substantially comparable
information shall be provided by the Servicer pursuant to any
requirements of the Code as from time to time are in force.
The Servicer shall prepare and file any and all tax
returns, information statements or other filings relating to the
period of time prior to the sale of the Mortgage Loans by the
Servicer to the Purchaser required to be delivered to any
governmental taxing authority pursuant to any applicable law with
respect to the Mortgage Loans. In addition, the Servicer shall
provide the Purchaser with such information concerning the
Mortgage Loans as is necessary for the Purchaser to prepare its
federal income tax returns.
Section 5.03. Monthly Advances by Servicer. On the
Business Day immediately preceding each Remittance Date, the
Servicer shall deposit in the Custodial Account from its own funds
an amount equal to all Monthly Payments (with interest adjusted to
the Remittance Rate) which were due on the Mortgage Loans during
the applicable Due Period and which were delinquent at the close of
business on the related Determination Date or which were deferred
pursuant to Section 4.01. The Servicer's obligation to make such
Monthly Advances as to any Mortgage Loan will continue through the
last Monthly Payment due prior to the payment in full of the
Mortgage Loan, or through the last Remittance Date prior to the
Remittance Date for the distribution of all Liquidation Proceeds
and other payments or recoveries (including Insurance Proceeds and
Condemnation Proceeds) with respect to the Mortgage Loan; provided,
however, that the Servicer shall not be obligated to make any
Monthly Advance to the extent that, in its reasonable judgment, the
Servicer determines that such Monthly Advance will not be
ultimately recoverable by it either out of late payments by the
Mortgagor, Liquidation Proceeds, Insurance Proceeds or otherwise,
such determination (and any determination by the Servicer that it
had made a Nonrecoverable Advance) to be certified by the Servicer
by delivery of a Certificate from a Servicing Officer substantially
in the form of Exhibit H hereto to the Purchaser on or prior to the
Business Day preceding the related Remittance Date.
ARTICLE VI
GENERAL SERVICING PROCEDURES
Section 6.01. Transfers of Mortgaged Property. The
Servicer shall use its best efforts to enforce any "due-on-sale"
provision contained in any Mortgage or Mortgage Note and to deny
assumption by the person to whom the Mortgaged Property has been or
is about to be sold whether by absolute conveyance or by contract
of sale, and whether or not the Mortgagor remains liable on the
Mortgage and the Mortgage Note. When the Mortgaged Property has
been conveyed by the Mortgagor, the Servicer shall, to the extent
it has knowledge of such conveyance, exercise its rights to
accelerate the maturity of such Mortgage Loan under the
"due-on-sale" clause applicable thereto, provided, however, that
the Servicer shall not exercise such rights if prohibited by law
from doing so or if the exercise of such rights will impair or
threaten to impair any recovery under the related Primary Mortgage
Insurance Policy, if any.
If the Servicer reasonably believes it is unable under
applicable law to enforce such "due-on-sale" clause, the Servicer
shall enter into (i) an assumption and modification agreement with
the person to whom such property has been conveyed, pursuant to
which such person becomes liable under the Mortgage Note and the
original Mortgagor remains liable thereon or (ii) in the
event the Servicer is unable under applicable law to require that
the original Mortgagor remain liable under the Mortgage Note and
the Servicer has the prior consent of the primary mortgage guaranty
insurer, a substitution of liability agreement with the purchaser
of the Mortgaged Property pursuant to which the original Mortgagor
is released from liability and the purchaser of the Mortgaged
Property is substituted as Mortgagor and becomes liable under the
Mortgage Note. If an assumption fee is collected by the Servicer
for entering into an assumption agreement or a substitution of
liability agreement, such fee, including any prepayment fees or
penalties, will be retained by the Servicer as additional servicing
compensation. In connection with any such assumption, neither the
Mortgage Interest Rate borne by the related Mortgage Note, the term
of the Mortgage Loan nor the outstanding principal amount of the
Mortgage Loan shall be changed.
To the extent that any Mortgage Loan is assumed, the
Servicer shall inquire diligently into the creditworthiness of the
proposed transferee, and shall use the underwriting criteria for
approving the credit of the proposed transferee that are
customarily used by the Company with respect to underwriting
mortgage loans of the same type as the Mortgage Loans. If the
credit of the proposed transferee does not meet such underwriting
criteria, the Servicer diligently shall, to the extent permitted by
the Mortgage or the Mortgage Note and by applicable law, accelerate
the maturity of the Mortgage Loan.
Section 6.02. Satisfaction of Mortgages and Release of
Mortgage Files. Upon the payment in full of any Mortgage Loan, or
the receipt by the Servicer of a notification that payment in full
will be escrowed in a manner customary for such purposes, the
Servicer shall notify the Purchaser in the Monthly Remittance
Advice as provided in Section 5.02, and may request the release of
any Mortgage Loan Documents.
If the Servicer satisfies or releases a Mortgage without
first having obtained payment in full of the indebtedness secured
by the Mortgage or should the Servicer otherwise prejudice any
rights the Purchaser may have under the mortgage instruments, upon
written demand of the Purchaser, the Servicer shall repurchase the
related Mortgage Loan at the Repurchase Price by deposit thereof in
the Custodial Account within two Business Days of receipt of such
demand by the Purchaser. The Servicer shall maintain the Fidelity
Bond and Errors and Omissions Insurance Policy as provided for in
Section 4.12 insuring the Servicer against any loss it may sustain
with respect to any Mortgage Loan not satisfied in accordance with
the procedures set forth herein.
Section 6.03. Servicing Compensation. As compensation
for its services hereunder, the Servicer shall be entitled to
withdraw from the Custodial Account or to retain from interest
payments on the Mortgage Loans, the amount of its Servicing Fee,
less any amounts payable by the Servicer pursuant to Section
4.04(viii). The Servicing Fee shall be payable monthly and shall
be computed on the basis of the same unpaid principal balance and
for the period as to which any related interest payment on a
Mortgage Loan is computed. The Servicing Fee shall be payable only
at the time of and with respect to those Mortgage Loans for which
payment is in fact made of the entire amount of the Monthly
Payment. The obligation of the Purchaser to pay the Servicing Fee
is limited to, and payable solely from, the interest portion of
such Monthly Payments collected by the Servicer. The aggregate of
the Servicing Fees for any month with respect to the Mortgage Loans
shall be reduced by any amount payable by the Servicer with respect
to such month pursuant to Section 4.04 (viii).
Additional servicing compensation in the form of
assumption fees, late payment charges, and other similar charges
shall be retained by the Servicer to the extent not required to be
deposited in the Custodial Account. The Servicer shall be required
to pay all expenses incurred by it in connection with its servicing
activities hereunder and shall not be entitled to reimbursement
thereof except as specifically provided for herein.
Section 6.04. Annual Statement Regarding Minimum
Servicing Standards. The Servicer will deliver to the Purchaser on
or before April 15 of each year, beginning April 15, 1997, a
management representation letter to the Servicer-s independent
public accountants stating that the authors: (a) are responsible
for complying with the minimum servicing standards established in
the Mortgage Bankers Association of America-s Uniform Single
Attestation Program for Mortgage Bankers; (b) are responsible for
establishing and maintaining an effective internal control
structure; (c) have evaluated the Servicer-s compliance with such
minimum servicing standards; (d) have not found any noncompliance
with the minimum servicing standards; and (e) have disclosed any
communications from regulatory agencies, internal auditors and
other practitioners concerning possible noncompliance with the
minimum servicing standards.
Section 6.05. Annual Independent Certified Public
Accountants' Servicing Report. On or before April 15 of each year
beginning April 15, 1997, the Servicer, at its sole cost and
expense, shall cause a member of a firm of the American Institute
of Public Accountants to furnish a statement to the Purchaser to
the effect that (a) such firm has examined certain documents and
records relating to the servicing of mortgage loans by the Servicer
and (b) on the basis of such an examination it will opine that
management-s assertion that the Servicer has complied with the
minimum servicing standards identified in the Mortgage Bankers
Association of America-s Uniform Single Attestation Program for
Mortgage Bankers, is fairly stated in all material respects..
Section 6.06. Right to Examine Servicer Records. The
Purchaser shall have the right to examine and audit any and all of
the books, records, or other information of the Servicer, whether
held by the Servicer or by another on its behalf, with respect to
or concerning this Agreement or the Mortgage Loans, during normal
business hours, upon reasonable advance written notice. Any such
examination or audit shall not be an expense of the Servicer.
ARTICLE VII
COMPANY AND SERVICER TO COOPERATE
Section 7.01. Provision of Information. During the term
of this Agreement, the Company and Servicer, as appropriate, shall
furnish to the Purchaser such periodic, special, or other reports
or information and the Servicer shall furnish copies or originals
of any documents contained in the Servicing File for each Mortgage
Loan, whether or not provided for herein, as shall be necessary,
reasonable, or appropriate with respect to the Purchaser, any
regulatory requirement pertaining to the Purchaser or the purposes
of this Agreement. All such reports, documents or information
shall be provided by and in accordance with all reasonable
instructions and directions which the Purchaser may give.
Purchaser agrees that if such reports or information are not of the
type usually prepared by the Company or the Servicer, as the case
may be, Purchaser shall pay the reasonable and documented
out-of-pocket costs of the Company or the Servicer, as the case
may, for the preparation of such reports or information.
The Company and Servicer, as appropriate, shall execute
and deliver all such instruments and take all such action as the
Purchaser may reasonably request from time to time, in order to
effectuate the purposes and to carry out the terms of this
Agreement.
Section 7.02. Financial Statements; Servicing Facility.
The Company and Servicer shall furnish promptly to the Purchaser
the Company's and Servicer-s audited financial statements for the
most recently completed two fiscal years, provided that, in the
case of the Servicer such audited financial statements shall be
consolidated financial statements which reflect the financial
condition of the Servicer, its parent and its subsidiaries. The
Company and Servicer also shall make available any comparable
interim statements to the extent any such statements have been
prepared by or on behalf of the Company and Servicer (and are
available upon request to members or stockholders of the Company
and Servicer or to the public at large).
The Company and Servicer also shall make available upon
reasonable written notice and during normal business hours to the
Purchaser or a knowledgeable financial or accounting officer for
the purpose of answering questions respecting recent developments
affecting the Company and Servicer or the financial statements of
the Company and Servicer.
ARTICLE VIII
THE COMPANY AND SERVICER
Section 8.01. Indemnification; Third Party Claims. The
Company and Servicer shall each indemnify the Purchaser and hold it
harmless against any and all claims, losses, damages, penalties,
fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments, and any other costs, fees and expenses that the
Purchaser may sustain as a result of the failure of the Company or
Servicer to perform their respective duties as specified herein,
and with respect to the Servicer, to service the Mortgage Loans in
strict compliance with the terms of this Agreement. Each of the
Company and the Servicer, as appropriate, immediately shall notify
the Purchaser if a claim is made by a third party with respect to
this Agreement or the Mortgage Loans, assume (with the prior
written consent of the Purchaser if time permits) 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 either the Company
or the Servicer, as appropriate, or the Purchaser in respect of
such claim. The Company or the Servicer, as the case may be, shall
follow any written instructions received from the Purchaser in
connection with such claim. The Purchaser promptly shall reimburse
the Company and the Servicer (or with respect to the Servicer, at
the Servicer's option, the Servicer shall be reimbursed out of the
Custodial Account as provided in Section 4.05) for all amounts
advanced by either of them pursuant to this Section 8.01 except
when the claim results from the failure of the Servicer to service
and administer the Mortgage Loans in strict compliance with the
terms of this Agreement.
Section 8.02. Merger or Consolidation of the Company or
the Servicer. Except as set forth in the following paragraph, the
Company and the Servicer shall keep in full effect its existence,
rights and franchises as a corporation, and shall 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 Servicer or the Company, as the
case may be, may be merged or consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the
Servicer or the Company, as the case may be, shall be a party, or
any Person to whom the Servicer or the Company, as the case may be,
has sold substantially all of its assets, or any Person succeeding
to the business of the Servicer or the Company, as the case may be,
or with respect to the Servicer, any Person more than 50% of the
voting stock of which is directly or indirectly owned by Fleet
Financial Group, Inc. or any limited partnership in which the sole
general partner thereof is either the Servicer or a Person more than 50%
of the voting stock of which is owned directly or indirectly by Fleet
Financial Group, Inc., shall be the successor of the Servicer or
the Company, 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 (i) the successor or surviving Person
executes an agreement of assumption to perform the obligations of
the Servicer or the Company, as the case may be, hereunder, whether
occurring before or after such consolidation, merger, conversion or
succession, and (ii) with respect to the Servicer, the successor or
surviving Person shall be an institution that is approved to
service mortgage loans on behalf of FNMA or FHLMC and has a net
worth of not less than $15,000,000.
Section 8.03. Limitation on Liability of Company,
Servicer and Others. Neither the Company, the Servicer nor any of
the directors, officers, employees or agents of the Company or the
Servicer shall be under any liability to the Purchaser for any
action taken, or for refraining from the taking of any action, in
good faith pursuant to this Agreement, or for errors in judgment,
provided, however, that this provision shall not protect the
Company or the Servicer or any such person against any breach of
warranties or representations made herein, or failure to perform
its obligations in strict compliance with any standard of care set
forth in this Agreement, or any liability that would otherwise be
imposed by reason of willful misfeasance, bad faith or negligence
in the performance of its duties or by reason of reckless disregard
of its obligations and duties hereunder. The Company, the Servicer
and any director, officer, employee or agent of the Company or 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 Company and the Servicer shall not
be under any obligation to appear in, prosecute or defend any legal
action which, in the case of the Servicer, is not incidental to its
duties to service the Mortgage Loans in accordance with this
Agreement and which in either the Company-s or Servicer-s opinion
may cause it to incur any expense or liability, provided, however,
that the Company or the Servicer may, with the consent of the
Purchaser (which consent shall not be unreasonably withheld),
undertake any such action which it may deem necessary or desirable
in respect to this Agreement and the rights and duties of the
parties hereto. In such event, the Company or the Servicer, as the
case may be, shall be entitled to reimbursement from the Purchaser
of the reasonable legal expenses and costs of such action and any
liability resulting therefrom (or, with respect to the Servicer, at
the Servicer-s option, the Servicer shall be reimbursed out of the
Custodial Account as provided in Section 4.05), other than any
liability or expense incurred by reason of willful misfeasance, bad
faith or negligence on the part of the Company or the Servicer.
Section 8.04. Limitation on Resignation and Assignment
by Company and the Servicer. The Purchaser has entered into this
Agreement with the Company and the Servicer in reliance upon the
independent status of the Company and the Servicer, and the
representations as to the adequacy of its servicing facilities,
plant, personnel, records and procedures, its integrity, reputation
and financial standing, and the continuance thereof. Therefore,
neither the Company nor the Servicer unless otherwise permitted in
this Agreement shall assign their respective rights under this
Agreement or the servicing hereunder or delegate their respective
duties hereunder or any portion thereof (to other than the
Subservicer in the case of the Servicer), or sell or otherwise
dispose of all or substantially all of their respective property or
assets without, in each case, the prior written consent of the
Purchaser, which consent shall not be unreasonably withheld;
provided, that in each case, there must be delivered to the
Purchaser a letter from each of the Rating Agencies to the effect
that such transfer of servicing or sale or disposition of assets
will not result in a qualification, withdrawal or downgrade of the
then-current rating of any of the Certificates. In addition, the
ability of the Servicer to assign its rights and delegate its
duties under this Agreement to a successor servicer shall be
subject to the following conditions:
(i) Such successor servicer must be qualified to service
loans for FNMA or FHLMC;
(ii) Such successor servicer must have a net worth of not
less than $15,000,000;
(iii) Such successor servicer must execute and
deliver to the Trustee an agreement, in form and substance
reasonably satisfactory to the Trustee, that contains an assumption
by such successor servicer of the due and punctual performance and
observance of each covenant and condition to be performed and
observed by the Servicer under this Agreement;
(iv) There must be delivered to the Trustee a letter from
each of the Rating Agencies to the effect that such transfer of
servicing will not result in a qualification, withdrawal or
downgrade of the then-current rating of any of the Certificates;
(v) The Servicer shall, at its cost and expense, take
such steps that may be necessary or appropriate to effectuate and
evidence the transfer of the servicing of the Mortgage Loans to
such successor servicer in accordance with Accepted Servicing
Practices and applicable law, including, but not limited to, the
following: (A) to the extent required by the terms of the Mortgage
Loans and by applicable federal and state laws and regulations, the
Servicer shall timely mail to each obligor under a Mortgage Loan
any required notices or disclosures describing the transfer of
servicing of the Mortgage Loans to the successor servicer; (B) the
Servicer shall transmit to any related insurer
notification of such transfer of servicing; (C) the Servicer shall
deliver to the successor servicer all Mortgage Loan Documents and
any related records or materials; (D) the Servicer shall transfer
to the successor servicer all funds held by the Servicer in respect
of the Mortgage Loans, other than amounts payable to the Servicer
pursuant to this Agreement; (E) the Servicer shall remit to the
Purchaser the amount of any Monthly Advance made by the Servicer on
any prior date out of amounts held in a Custodial Account for
future distribution and not yet paid into such Custodial Account by
the Servicer; (F) the Servicer shall, after the effective date of
the transfer of servicing to the successor servicer, continue to
forward to such successor servicer, promptly upon receipt, the
amount of any payments or other recoveries received by the
Servicer, and the Servicer shall notify the successor servicer of
the source and proper application of each such payment or recovery;
(G) the Servicer shall, after the effective date of transfer of
servicing to the successor servicer, continue to cooperate with the
successor servicer to facilitate such transfer in such manner and
to such extent as the successor servicer may reasonably request.
Except as provided above, the Servicer shall not resign
from the obligations and duties hereby imposed on it except by
mutual consent of the Servicer and the Purchaser or upon the
determination that its duties hereunder are no longer permissible
under applicable law and such incapacity cannot be cured by the
Servicer. Any such determination permitting the resignation of the
Servicer shall be evidenced by an Opinion of Counsel to such effect
delivered to the Purchaser which Opinion of Counsel shall be in
form and substance reasonably acceptable to the Purchaser. No such
resignation shall become effective until a successor shall have
assumed the Servicer's responsibilities and obligations hereunder
in the manner provided in Section 11.01.
Without in any way limiting the generality of this
Section 8.04, in the event that the Servicer either shall assign
this Agreement or the servicing responsibilities hereunder or
delegate its duties hereunder or any portion thereof (to other than
the Subservicer) or sell or otherwise dispose of all or
substantially all of its property or assets, without the prior
written consent of the Purchaser or as otherwise permitted in this
Agreement, then the Purchaser shall have the right to terminate
this Agreement upon notice given as set forth in Section 9.01,
without any payment of any penalty or damages and without any
liability whatsoever to the Company or any third party.
ARTICLE IX
DEFAULT
Section 9.01. Events of Default. Each of the following
shall constitute an Event of Default on the part of the Servicer:
(i) any failure by the Servicer to remit to the
Purchaser any payment required to be made under the terms of this
Agreement which continues unremedied for a period of five Business
Days after the date upon which written notice of such failure,
requiring the same to be remedied, shall have been received by the
Servicer from the Purchaser; or
(ii) failure by the Servicer duly to observe or perform
in any material respect any other of the covenants or agreements on
the part of the Servicer set forth in this Agreement which
continues unremedied for a period of 30 days after the date on
which written notice of such failure, requiring the same to be
remedied, shall have been given to the Servicer, as appropriate, by
the Purchaser; provided, however, if such default is reasonably
susceptible of cure, but not within such 30 day period, then
Servicer may be permitted up to an additional 30 days to cure such
default provided that the Servicer diligently and continuously
pursues such cure; or
(iii) failure by the Servicer to maintain any license
required to do business in any jurisdiction where a Mortgaged
Property is located which failure adversely affects the Servicer-s
ability to perform its obligations under this Agreement or
adversely affects the value of any Mortgage Loan, which failure
continues for a period of time longer than is deemed reasonable
under the circumstances by the Purchaser; or
(iv) a decree or order of a court or agency or
supervisory authority having jurisdiction for the appointment of a
conservator or receiver or liquidator in any insolvency,
readjustment of debt, including bankruptcy, 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 60 days; or
(v) the Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency,
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
(vi) 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, bankruptcy or
reorganization statute, make an assignment for the benefit of its
creditors, voluntarily suspend payment of its obligations; or
(vii) the Servicer ceases to be either an approved
FNMA or FHLMC servicer; or
(viii) the Servicer attempts to assign its right to
servicing compensation hereunder without satisfying the
requirements of Sections 8.02 or 8.04 or the Servicer attempts,
without the consent of the Purchaser, to sell or otherwise dispose
of all or substantially all of its property or assets (other than
in compliance with Sections 8.02 or 8.04) or to
assign this Agreement or the servicing responsibilities hereunder
or to delegate its duties hereunder or any portion thereof to other
than the Subservicer in violation of Sections 8.02 or 8.04; or
(ix) the Servicer directly or through the Subservicer (to
the extent that such Subservicer continues to subservice the
Mortgage Loans) fails to have the facilities, procedures, and
experienced personnel necessary for the servicing, in accordance
with Accepted Servicing Practices, of the Mortgage Loans.
In each and every such case, so long as an Event of
Default shall not have been remedied (within, if applicable, the
period specified), in addition to whatsoever rights the Purchaser
may have at law or equity to damages, including injunctive relief
and specific performance, the Purchaser, by notice in writing to
the Servicer, may, taking into account, in the case of the Trustee,
the best interests of holders of Certificates, terminate all the
rights and obligations of the Servicer under this Agreement and in
and to the Mortgage Loans and the proceeds thereof.
Upon receipt by the Servicer of such written notice, all
authority and power of the Servicer under this Agreement, whether
with respect to the Mortgage Loans or otherwise, shall pass to and
be vested in the successor appointed pursuant to Section 11.01.
Upon written request from any Purchaser, the Servicer shall
prepare, execute and deliver to the successor entity designated by
the Purchaser any and all documents and other instruments, place in
such successor's possession all Mortgage Files, and do or cause to
be done all other acts or things necessary or appropriate to effect
the purposes of such notice of termination, including but not
limited to the transfer and endorsement or assignment of the
Mortgage Loans and related documents, at the Servicer's sole
expense. The Servicer shall cooperate with the Purchaser and such
successor in effecting the termination of the Servicer's
responsibilities and rights hereunder, including without
limitation, the transfer to such successor for administration by it
of all cash amounts which shall at the time be credited by the
Servicer to the Custodial Account or Escrow Account or thereafter
received with respect to the Mortgage Loans.
Section 9.02. Waiver of Defaults. By a written notice,
the Purchaser may waive any default by the Company or 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 Event of Default arising therefrom shall be deemed
to have been remedied for every purpose of this Agreement. No such
waiver shall extend to any subsequent or other default or impair
any right consequent thereon except to the extent expressly so
waived.
ARTICLE X
TERMINATION
Section 10.01. Termination. This Agreement shall terminate
upon either: (i) the later of the final payment or other liquidation
(or any advance with respect thereto) of the last Mortgage Loan or the
disposition of any REO Property with respect to the last Mortgage
Loan and the remittance of all funds due hereunder; or (ii) mutual
consent of the Servicer and the Purchaser in writing.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01. Successor to Servicer. Prior to
termination of the Servicer's responsibilities and duties under
this Agreement pursuant to Sections 8.04, 9.01 or 10.01, the
Purchaser shall (i) succeed to and assume all of the Servicer's
responsibilities, rights, duties and obligations under this
Agreement, or (ii) appoint a successor having the characteristics
set forth in clauses (i) through (iv) of Section 8.04 which shall
succeed to all rights and assume all of the responsibilities,
duties and liabilities of the Servicer under this Agreement prior
to the termination of Servicer's responsibilities, duties and
liabilities under this Agreement. In connection with such
appointment and assumption, the Purchaser may make such
arrangements for the compensation (not to exceed the Servicing Fee)
of such successor out of payments on Mortgage Loans as it and such
successor shall agree. In the event that the Servicer's duties,
responsibilities and liabilities under this Agreement should be
terminated pursuant to the aforementioned sections, the Servicer
shall discharge such duties and responsibilities during the period
from the date it acquires knowledge of such termination until the
effective date thereof with the same degree of diligence and
prudence which it is obligated to exercise under this Agreement,
and shall take no action whatsoever that might impair or prejudice
the rights or financial condition of its successor. The
resignation or removal of the Servicer pursuant to the
aforementioned sections shall not become effective until a
successor shall be appointed pursuant to this Section 11.01 and
shall in no event relieve the Servicer of the representations and
warranties made pursuant to Section 3.02 and the Company of the
representations and warranties made pursuant to Sections 3.01 and
3.03 and the remedies available to the Purchaser under Section
3.04, it being understood and agreed that the provisions of such
Sections 3.01, 3.02, and 3.03 shall be applicable to the Company or
Servicer, as the case may be, notwithstanding any such sale,
assignment, resignation or termination of the Servicer, or the
termination of this Agreement.
Any successor appointed as provided herein shall execute,
acknowledge and deliver to the Servicer and to the Purchaser an
instrument accepting such appointment, wherein the successor shall
make the representations and warranties set forth in Section 3.02,
whereupon such successor shall become fully vested with all the
rights, powers, duties, responsibilities,
obligations and liabilities of the Servicer, with like effect as if
originally named as a party to this Agreement. Any termination or
resignation of the Servicer or termination of this Agreement
pursuant to Sections 8.02, 8.04, 9.01, or 10.01 shall not affect
any claims that any Purchaser may have against the Company or the
Servicer arising out of the Company-s or the Servicer's actions or
failure to act, as the case may be, prior to any such termination
or resignation.
The Servicer shall deliver promptly to the successor
servicer the funds in the Custodial Account and Escrow Account, all
Mortgage Files and all Servicing Files and related documents and
statements held by it hereunder and the Servicer shall account for
all funds and shall execute and deliver such instruments and do
such other things as may reasonably be required to more fully and
definitively vest in the successor all such rights, powers, duties,
responsibilities, obligations and liabilities of the Servicer.
Section 11.02. Amendment. Capitalized terms used in
this Section 11.02 but not defined in this Agreement shall have the
meanings assigned to them in the Trust Agreement.
(a) This Agreement may be amended from time to time by
the Company, the Servicer and the Purchaser (i) to cure any
ambiguity, (ii) to correct or supplement any provision herein which
may be inconsistent with any other provisions herein, (iii) to make
any other provisions, with respect to matters or questions arising
under this Agreement or (iv) to add, delete, or amend any
provisions to the extent necessary or desirable to comply with any
requirements imposed by the Code and the REMIC Provisions. No such
amendment effected pursuant to the preceding sentence shall, as
evidenced by an Opinion of Counsel, adversely affect the status of
any REMIC created pursuant to the Trust Agreement, nor shall such
amendment effected pursuant to clause (iii) of such sentence
adversely affect in any material respect the interests of any
Holder of any Certificates issued by the Trust. Prior to entering
into any amendment pursuant to this paragraph, the Purchaser may
require an Opinion of Counsel (at the expense of the party
requesting such amendment) to the effect that such amendment is
permitted under this paragraph. Any such amendment shall be deemed
not to adversely affect in any material respect any Holder of
Certificates, if the Purchaser receives written confirmation from
each Rating Agency that such amendment will not cause such Rating
Agency to reduce the then current rating assigned to the
Certificates (and any Opinion of Counsel requested by the Trustee
in connection with any such amendment may rely expressly on such
confirmation as the basis therefor).
(b) This Agreement may also be amended from time to time
by the Company, the Servicer and the Purchaser with the consent of
the Holders of not less than 66-2/3% of the Aggregate Certificate
Principal Amount of each Class of Certificates affected thereby for
the purpose of adding any provisions to or changing in any manner or
deleting any of the provisions of this Agreement or of modifying in any
manner the rights of the Holders (except as such additions, changes,
deletions or modifications may be permitted under Section 11.02(a) above);
provided, however, that no such amendment shall be made unless the Purchaser
receives an Opinion of Counsel, at the expense of the party requesting the
change, that such change will not adversely affect the status of
any REMIC created pursuant to the Trust Agreement as a REMIC or
cause a tax to be imposed on any such REMIC.
Section 11.03. Closing . The closing for the
purchase and sale of the Mortgage Loans shall be subject to the
Purchaser receiving fully executed originals of the following
documents:
a. this Agreement in three counterparts;
b. a Custodial Account Certification in the form of
Exhibit D-1 hereto or a Custodial Account Letter Agreement in the
form of Exhibit D-2;
c. an Escrow Account Certification in the form of
Exhibit E-1 hereto or an Escrow Account Letter Agreement in the
form of Exhibit E-2 hereto;
d. an Officer-s Certificate from the Company in the
form of Exhibit J hereto;
e. a Trust Receipt from the Custodian with exceptions
that are acceptable to Purchaser;
f. an Officer-s Certificate from the Servicer in the
form of Exhibit K hereto;
g. an Opinion Letter of the Company in the form of
Exhibit L hereto;
h. an Opinion Letter of the Servicer in the form of
Exhibit M hereto; and
i. a Security Release Certification, in the form of
Exhibit N hereto if the Company is a member of the Federal Home
Loan Bank System executed by the applicable regional Federal Home
Loan Bank and, if applicable, in the form of Exhibit O hereto
executed by any other person, as requested by 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.
Section 11.04. GOVERNING LAW. THIS AGREEMENT SHALL
BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS WITHOUT REGARD TO
CONFLICT OF LAWS PRINCIPLES APPLIED IN SUCH STATE.
Section 11.05. Duration of Agreement. This
Agreement shall continue in existence and effect until terminated
as herein provided, except that Sections 3.01, 3.02, 3.03, 8.01 and
8.03 shall survive such termination. This Agreement shall
remain in full force and effect notwithstanding transfers of the
Mortgage Loans by the Purchaser or any subsequent transferee.
Section 11.06. Notices. All demands, notices and
communications hereunder shall be in writing and shall be deemed to
have been duly given if personally delivered at, or mailed by
registered mail, postage prepaid, or shipped by generally
recognized overnight courier service (provided that confirmation of
delivery is received by the sender), addressed as follows, or to
such other address as either party (or its assignee or any
subsequent assignee thereof, in the case of the Purchaser) may
designate by notice to the other party:
(i) if to the Company:
Household Bank, f.s.b.
0000 Xxxxxxx Xxxx
Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx
Vice President
with a copy to: Associate General Counsel (same address
as above)
or such other address as may hereafter be furnished to
the Purchaser and the Servicer in writing by the Company;
(ii) if to the Servicer:
Fleet Mortgage Corp.
c/o Fleet Mortgage Group, Inc.
0000 Xxxx Xxxxxx, Xxxxxxx Xxxxx
Xxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Executive Vice President of Servicing
with a copy to:
Xxxxxx Xxxxxxxx (same address as above)
Vice President and Assistant General Counsel
Xxxxxxx Xxxxxxxx (same address as above)
Counsel
or such other address as may hereafter be furnished to
the Purchaser and the Company in writing by the Servicer;
(iii) if to the Purchaser:
Xxxxxx Capital, A Division of
Xxxxxx Brothers Holdings Inc.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Manager, Contract Finance
with a copy to:
Cadwalader, Xxxxxxxxxx & Xxxx
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Link, Jr.
or such other address as may hereafter be furnished to the Company
and the Servicer in writing by the Purchaser.
Section 11.07. Severability of Provisions. If any
one or more of the covenants, agreements, provisions or terms of
this Agreement shall be held invalid for any reason whatsoever,
then such covenants, agreements, provisions or terms shall be
deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect
the validity or enforceability of the other provisions of this
Agreement.
Section 11.08. Relationship of Parties. Nothing
herein contained shall be deemed or construed to create a
partnership or joint venture between the parties hereto and the
services of the Company and the Servicer shall be rendered as an
independent contractor and not as agent for the Purchaser.
Section 11.09. Execution; Successors and Assigns.
This Agreement may be executed in one or more counterparts and by
the different parties hereto on separate counterparts, each of
which, when so executed, shall be deemed to be an original; such
counterparts, together, shall constitute one and the same
agreement. This Agreement shall inure to the benefit of and be
binding upon the Company, the Servicer and the Purchaser and their
respective successors and assigns.
Section 11.10. 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 other comparable jurisdictions in which any of the
Mortgaged Properties is situated, and in any appropriate public
recording office or elsewhere, such recordation to be effected at
the Purchaser's expense in the event recordation is either
necessary under applicable law or requested by the Purchaser at its
sole option.
Section 11.11. Assignment by Purchaser. The
Purchaser shall have the right, upon notice to but without the
consent of the Company or the Servicer, to assign, in whole or in
part, its interest under this Agreement with respect to the
Mortgage Loans (other than any rights of the Purchaser under
Section 11.13) to any Person including, but not limited to the
Depositor, which in turn may assign its interest under this
Agreement with respect to the Mortgage Loans to the Trustee, and
the Trustee then shall succeed to all rights of the Purchaser under
this Agreement. All references to the Purchaser in this Agreement
(other than in Section 11.13) shall be deemed to include its
assignee or designee and any subsequent assignee, specifically
including the Trustee, provided that the Servicer shall not be
obligated to make monthly remittances hereunder to more than four
(4) owners of Mortgage Loans at any one time.
Section 11.12. No Solicitation. From and after the
date of execution of this Agreement, the Company and the Servicer
agree 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 Company's or Servicer's
behalf, to solicit the borrower or obligor under any Mortgage Loan
for purposes relating to the marketing of the Company's or
Servicer's, as the case may be, first mortgage loan products,
including to refinance a Mortgage Loan, in whole or in part,
without the prior written consent of the Purchaser.
Notwithstanding the foregoing, it is understood and agreed that (a)
promotions undertaken by the Company, the Servicer or any affiliate
of the Company or the Servicer that are directed to segments of the
general public at large, including, without limitation, mass
mailings based on commercially acquired mailing lists, and
newspaper, radio and television advertisements and (b) general
solicitations that include mortgagors with respect to potential
refinancing and in targeted refinancing solicitations, so long, as
the targeted group is based on either (i) the Servicer-s entire
servicing portfolio or (ii) certain mortgage loan characteristics,
and in either event does not consist primarily of Mortgagors shall
not constitute solicitation under this Section 11.12. This Section
11.12 shall not be deemed to preclude solicitation for any other
financial products or services.
Section 11.13. Reconstitution. The Company and the
Servicer understand and agree that it is the intent of the
Purchaser to securitize the Mortgage Loans (i.e., to form a trust
and to issue securities evidencing interests therein). The Company
and the Servicer agree to review and adhere to the terms of any
agreements that may be required to facilitate such securitization,
it being understood that any such agreements will not impose upon
the Company or the Servicer any obligations more burdensome than
those contained in this Agreement, and to provide and execute such
certificates, legal opinions and other documents as may be
necessary to facilitate such securitization. Company shall
reimburse the Servicer for any reasonable and documented
out-of-pocket costs incurred by Servicer in complying with this
Section 11.13.
Neither the Company nor the Servicer shall reveal to any
party, without the written consent of Xxxxxx Capital, the price
paid to the Company by Xxxxxx Capital for the Mortgage Loans,
except to the extent that it is appropriate for the Company to
reveal such information to its legal counsel, its auditors, and
taxing authorities or other governmental authorities.
The Company agrees that, notwithstanding anything to the
contrary in the Purchase Price and Terms Letter or in this
Agreement, the provisions of Section 3 of the Purchase Price and
Terms Letter shall survive the execution of this Agreement and
shall remain in effect until the closing of the securitization
transaction referred to above.
IN WITNESS WHEREOF, the Company and the Purchaser 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 CAPITAL, A DIVISION OF
XXXXXX BROTHERS HOLDINGS INC.
By:
Name:
Title:
HOUSEHOLD BANK, f.s.b.
By:
Name:
Title:
FLEET MORTGAGE CORP.
By:
Name:
Title:
EXHIBIT A
MORTGAGE LOAN SCHEDULE
EXHIBIT B
CONTENTS OF EACH MORTGAGE FILE
With respect to each Mortgage Loan, the Mortgage File shall include
each of the following items, which shall be available for inspection by the
Purchaser (or its designee), and which shall be retained by the Servicer in
the Servicing File or delivered to the Purchaser (or its designee) pursuant to
Section 2.03 of the Mortgage Loan Sale, Warranties and Servicing Agreement to
which this Exhibit is attached (the "Agreement"):
1. In the case of each Mortgage Loan , the original
Mortgage Note endorsed without recourse in proper form
as follows: "Pay to the order of _____________, without
recourse" (in each case, with all necessary intervening
endorsements as applicable).
2. The original of any guarantee executed in
connection with the Mortgage Note (if any).
3. The original recorded Mortgage with evidence of
recording indicated thereon. If, in connection with
any Mortgage Loan, the Company cannot deliver the
Mortgage with evidence of recording thereon on or
prior to the Closing Date because of (a) a delay
caused by the public recording office where
such Mortgage has been delivered for recordation, (b)
the original is retained by the public recording office or
(c) such Mortgage has been lost, the Company shall
deliver or cause to be delivered to the Trustee
(or its custodian), in the case of a delay due to
recording, a true copy of such Mortgage, pending
delivery of the original thereof, together with an
Officer's Certificate of the Company certifying that
the copy of such Mortgage delivered to the Trustee (or
its custodian) is a true copy and that the original of
such Mortgage has been forwarded to the public
recording office, in the case that the original is
retained by the public recording office, a certified
copy by such public recording office, or, in the case
of a Mortgage that has been lost, a copy thereof
(certified as provided for under the laws of the
appropriate jurisdiction) and a written Opinion of
Counsel acceptable to the Trustee and the Company that
an original recorded Mortgage is not required to
enforce the Trustee's interest in the Mortgage Loan.
4. The original of each assumption, modification or
substitution agreement, if any, relating to the
Mortgage Loans, or, as to any assumption, modification
or substitution agreement which cannot be delivered
on or prior to the Closing Date because of a delay
caused by the public recording office where such
assumption, modification or substitution agreement has
been delivered for recordation, a photocopy of such
assumption, modification or substitution agreement,
pending delivery of the original thereof, together
with an Officer's Certificate of the Company
certifying that the copy of such assumption,
modification or substitution agreement delivered to
the Trustee (or its custodian) is a true copy and that
the original of such agreement has been forwarded to the
public recording office.
5. The original Assignment of Mortgage for each
Mortgage Loan, in form and substance acceptable for
recording. 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 Company in a merger, the Assignment of
Mortgage must be made by "( ), successor by
merger to (name of predecessor)." If the Mortgage Loan
was acquired or originated by the Company while doing business
under another name, the Assignment of Mortgage must be
by "( ), formerly known as (previous name)."
If the Mortgage Loan was assigned by the Company to
the Servicer then the related Assignment of Mortgage
must be executed by the Servicer. Subject to the
foregoing, and where permitted under the applicable
laws of the jurisdiction wherein the Mortgaged Property
is located, such assignments of Mortgage may be made
by blanket assignments for Mortgage Loans secured by
the Mortgaged Properties located in the same county.
6. Originals of all intervening assignments of the
Mortgage with evidence of recording thereon, or if any
such intervening assignment has not been returned from
the applicable recording office or has been lost
or if such public recording office retains the
original recorded assignments of mortgage, the Company
shall deliver or cause to be delivered to the Purchaser
, a photocopy of such intervening assignment, together
with (i) in the case of a delay caused by the public
recording office, an Officer-s Certificate of the
Company stating that such intervening assignment of
mortgage has been dispatched to the appropriate public
recording office for recordation and that such original
recorded intervening assignment of mortgage or a copy
of such intervening assignment of mortgage certified by
the appropriate public recording office or by the
title insurance company that issued the title policy
to be a true and complete copy of the original recorded
intervening assignment of mortgage will be promptly
delivered to the Purchaser upon receipt thereof by
the Company; or (ii) in the case of an intervening
assignment where a public recording office retains the
original recorded intervening assignment or in the case
where an intervening assignment is lost after
recordation in a public recording office, a copy of
such intervening assignment certified by such public
recording office to be a true and complete copy of the
original recorded intervening assignment.
7. The original Primary Mortgage Insurance Policy or
certificate of insurance, where required pursuant to
the Agreement.
8. The original or duplicate original mortgagee policy
of title insurance or attorney's opinion of title
and abstract of title.
9. Any security agreement, chattel mortgage or equivalent
executed in connection with the Mortgage or as to any
security agreement, chattel mortgage or their
equivalent that cannot be delivered on or prior to
the Closing Date because of a delay caused by the public
recording office where such document has been delivered
for recordation, a photocopy of such document, pending
delivery of the original thereof, together with an
Officer's Certificate of the Company certifying that
the copy of such security agreement, chattel mortgage
or their equivalent delivered to the Trustee (or its
custodian) is a true copy and that the original of such
document has been forwarded to the public recording
office.
10. The original hazard insurance policy and, if required
by law, flood insurance policy, in accordance with
Section 4.10 of the Agreement.
11. Residential loan application.
12. Mortgage Loan closing statement.
13. Verification of employment and income.
14. Verification of acceptable evidence of source and
amount of downpayment.
15. Credit report on the Mortgagor.
16. Residential appraisal report.
17. Photograph of the Mortgaged Property.
18. Survey of the Mortgaged Property.
19. Copy of each instrument necessary to complete
identification of any exception set forth in the
exception schedule in the title policy, i.e., map
or plat, restrictions, easements, sewer agreements,
home association declarations, etc.
20. All required disclosure statements.
21. If available, termite report, structural engineer's
report, water potability and septic certification.
22. Sales contract (if applicable).
23. Tax receipts, insurance premium receipts,
ledger sheets, payment history from date of origination
, insurance claim files, correspondence, current and
historical computerized data files, and all other
processing, underwriting and closing papers and records
which are customarily contained in a mortgage loan file
and which are required to document the Mortgage Loan or
to service the Mortgage Loan.
EXHIBIT C-1
MORTGAGE LOAN DOCUMENTS
The Mortgage Loan Documents for each Mortgage Loan shall
include each of the following items, which shall be delivered to the
Purchaser or its designee pursuant to Section 2.03 of the Mortgage Loan Sale,
Warranties and Servicing Agreement to which this Exhibit is annexed
(the"Agreement"):
1. In the case of each Mortgage Loan , the original Mortgage
Note endorsed without recourse in proper form as
follows: "Pay to the order of _____________, without
recourse" (in each case, with all necessary intervening
endorsements as applicable);
2. The original of any guarantee executed in connection
with the Mortgage Note;
3. The original recorded Mortgage with evidence of
recording indicated thereon. If, in connection with
any Mortgage Loan, the Company cannot deliver the
Mortgage with evidence of recording thereon on or prior
to the Closing Date because of (a) a delay caused by
the public recording office where such Mortgage has
been delivered for recordation, (b) the original is
retained by the public recording office or (c) because
such Mortgage has been lost, the Company shall deliver
or cause to be delivered to the Trustee (or its
custodian), in the case of a delay due to recording, a
true copy of such Mortgage, pending delivery of the
original thereof, together with an Officer's
Certificate of the Company certifying that the copy of
such Mortgage delivered to the Trustee (or its
custodian) is a true copy and that the original of
such Mortgage has been forwarded to the public recording
office, in the case that the original is retained by the
public recording office, a certified copy thereof by such
public recording office, or, in the case of a Mortgage
that has been lost, a copy thereof (certified as
provided for under the laws of the appropriate
jurisdiction) and a written Opinion of Counsel
acceptable to the Trustee and the Company that an
original recorded Mortgage is not required to enforce
the Trustee's interest in the Mortgage Loan;
4. The original of each assumption, modification
or substitution agreement, if any, relating to the
Mortgage Loans, or, as to any assumption, modification
or substitution agreement which cannot be delivered on
or prior to the Closing Date because of a delay caused
by the public recording office where such assumption,
modification or substitution agreement has been
delivered for recordation, a photocopy of such
assumption, modification or substitution agreement,
pending delivery of the original thereof, together
with an Officer's Certificate of the Company certifying
that the copy of such assumption, modification
or substitution agreement delivered to the Trustee (or
its custodian) is a true copy and that the original of
such agreement has been forwarded to the public
recording office;
5. The original Assignment of Mortgage for each Mortgage
Loan, in form and substance acceptable for recording.
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 Company in
a merger, the Assignment of Mortgage must be made by
"( ), successor by merger to (name of
predecessor)." If the Mortgage Loan was acquired or
originated by the Company while doing business under
another name, the Assignment of Mortgage must be by "(
), formerly known as (previous name)." If the Mortgage
Loan was assigned by the Company to the Servicer then
the related Assignment of Mortgage must be executed by
the Servicer. Subject to the foregoing, and where
permitted under the applicable laws of the
jurisdiction wherein the Mortgaged Property is located,
such assignments of Mortgage may be made by blanket
assignments for Mortgage Loans secured by the Mortgaged
Properties located in the same county;
6. Originals of all intervening assignments of the
Mortgage with evidence of recording thereon,
or if any such intervening assignment has not been
returned from the applicable recording office or has
been lost or if such public recording office retains
the original recorded assignments of mortgage, the
Company shall deliver or cause to be delivered to the
Purchaser, a photocopy of such intervening assignment,
together with (i) in the case of a delay caused by the
public recording office, an Officer-s Certificate of
the Company stating that such intervening assignment
of mortgage has been dispatched to the appropriate
public recording office for recordation and that such
original recorded intervening assignment of mortgage
or a copy of such intervening assignment of mortgage
certified by the appropriate public recording office or
by the title insurance company that issued the title
policy to be a true and complete copy of the
original recorded intervening assignment of mortgage
will be promptly delivered to the Purchaser upon
receipt thereof by the Company; or (ii) in the case of
an intervening assignment where a public recording
office retains the original recorded intervening
assignment or in the case where an intervening
assignment is lost after recordation in a public
recording office, a copy of such intervening assignment
certified by such public recording office to be a
true and complete copy of the original recorded
intervening assignment.
7. The original or duplicate mortgagee title
insurance policy or attorney's opinion of title
and abstract of title; and
8. The original of any security agreement, chattel
mortgage or equivalent executed in connection with
the Mortgage or as to any security agreement, chattel
mortgage or their equivalent that cannot be delivered
on or prior to the Closing Date because of a delay
caused by the public recording office where such
document has been delivered for recordation, a
photocopy of such document, pending delivery of
the original thereof, together with an Officer's
Certificate of the Company certifying that the copy
of such security agreement, chattel mortgage or their
equivalent delivered to the Trustee (or its custodian)
is a true copy and that the original of such document
has been forwarded to the public recording office.
EXHIBIT C-2
REQUEST FOR RELEASE OF DOCUMENTS AND RECEIPT
(Date)
(Trustee)
(Address)
In connection with the administration of the mortgages held by you
as Trustee (or by the Custodian on your behalf) under a certain Trust Agreement
dated as of ( ), 199__ between Structured Asset Securities Corporation, as
Depositor, and you, as Trustee (the "Trust Agreement"), the undersigned
Servicer hereby requests a release of the Mortgage File held by you as Trustee
(or by the Custodian) with respect to the following described Mortgage
Loan for the reason indicated below.
Mortgagor's Name:
Address:
Loan No.:
Reason for requesting file:
1. Mortgage Loan paid in full. (The Servicer hereby certifies
that all amounts received in connection with the loan have been or will be
credited to the Collection Account or the Certificate Account (whichever is
applicable) pursuant to the Trust
Agreement.)
2. Mortgage Loan repurchased. (The Servicer hereby certifies
that the Purchase Price has been credited to the Collection Account or the
Certificate Account (whichever is applicable) pursuant to the Trust
Agreement.)
3. Mortgage Loan substituted. (The Servicer hereby certifies
that a Qualifying Substitute Mortgage Loan has been assigned and delivered to
you along with the related Mortgage File pursuant to the Trust Agreement.)
4. The Mortgage Loan is being foreclosed.
5. Other. (Describe)
The undersigned acknowledges that the above Mortgage File
will be held by the undersigned in accordance with the provisions
of the Trust Agreement and will be returned to you (or to the Custodian)
within ten (10) days of our receipt of the Mortgage File, except if the
Mortgage Loan has been paid in full, or repurchased or substituted for a
Qualifying Substitute Mortgage Loan (in which case the Mortgage File will be
retained by us permanently) and except if the Mortgage Loan is being
foreclosed (in which case the Mortgage File will be returned when no longer
required by us for such purpose).
Capitalized terms used herein shall have the meanings ascribed to
them in the Trust Agreement.
( )
By: _______________________________
Name:
Title:
EXHIBIT D-1
CUSTODIAL ACCOUNT CERTIFICATION
______________________, 199__
( ) hereby certifies that it has established the account
described below as a Custodial Account pursuant to Section
4.04 of the Mortgage Loan Sale, Warranties and Servicing Agreement,
dated as of ( ), 199__.
Title of Account: Fleet Mortgage Corp., in trust for Xxxxxx
Capital, A Division of Xxxxxx Brothers Holdings Inc.
Account Number: _________________________
Address of office or branch of the Servicer at which Account is
maintained:
_______________________
_______________________
_______________________
( )
By: _______________________________
Name:
Title:
EXHIBIT D-2
CUSTODIAL ACCOUNT LETTER AGREEMENT
______________________, 199__
To: ____________________
____________________
____________________
(the "Depository")
As the Servicer under the Mortgage Loan Sale, Warranties
and Servicing Agreement, dated as of ( ), 199__ (the
"Agreement"), we hereby authorize and request you to establish an
account, as a Custodial Account pursuant to Section 4.04 of the Agreement, to
be designated as "Fleet Mortgage Corp., in trust for
Xxxxxx Capital, A Division of Xxxxxx Brothers Holdings Inc.. All
deposits in the account shall be subject to withdrawal therefrom by
order signed by the Servicer. This letter is submitted to you in
duplicate. Please execute and return one original to us.
( )
By: _______________________________
Name:
Title:
The undersigned, as Depository, hereby certifies that the above described
account has been established under Account Number ___________, at the office
of the Depository indicated above, and agrees to honor withdrawals on such
account as provided above.
________________________________________
Depository
By: ________________________________
Name:
Title:
EXHIBIT E-1
ESCROW ACCOUNT CERTIFICATION
__________________, 199__
( ) hereby certifies that it has established
the account described below as an Escrow Account pursuant to Section 4.06 of
the Mortgage Loan Sale, Warranties and Servicing Agreement, dated as of () ,
199__.
Title of Account: Fleet Mortgage Corp., in trust for Xxxxxx
Capital, A Division of Xxxxxx Brothers Holdings Inc.
Account Number: _______________________
Address of office or branch of the Servicer at which Account is
maintained:
__________________________________________________
__________________________________________________
__________________________________________________
( )
By: _______________________________
Name:
Title:
EXHIBIT E-2
ESCROW ACCOUNT LETTER AGREEMENT
______________________, 199__
To: ____________________
____________________
____________________
(the "Depository")
As Servicer under the Mortgage Loan Sale, Warranties and
Servicing Agreement, dated as of ( ), 199__ (the "Agreement"),
we hereby authorize and request you to establish an account, as an
Escrow Account pursuant to Section 4.07 of the Agreement, to be designated as
"Fleet Mortgage Corp., in trust for Xxxxxx Capital,
A Division of Xxxxxx Brothers Holdings Inc.," or such other designation as
the Purchaser may direct. All deposits in the account shall be subject to
withdrawal therefrom by order signed by the Servicer. This letter is submitted
to you in duplicate. Please execute and return one original to us.
( )
By: _______________________________
Name:
Title:
Date: _______________________________
The undersigned, as Depository, hereby certifies that the above described
account has been established under Account Number _____________________, at the
office of the Depository indicated above, and agrees to honor withdrawals on
such account as provided above.
_________________________________________
Depository
By: _______________________________
Name:
Title:
Date: _______________________________
EXHIBIT F
MONTHLY REMITTANCE ADVICE
EXHIBIT G
MONTHLY ELECTRONIC DATA TRANSMISSION
EXHIBIT H
FORM OF CERTIFICATE OF SERVICING OFFICER
FOR NONRECOVERABLE ADVANCES
___________________________
(date)
(Trustee)
(Address)
Re: Mortgage Loan Sale, Warranties and Servicing
Agreement, dated as of ( ), 199__ (the
"Agreement")
Ladies and Gentlemen:
In accordance with the provisions of Section 5.03 of the
above-referenced Agreement, the undersigned hereby certifies that
it has determined, with regard to the Mortgage Loan(s) identified
below, that (future advances would) (Monthly Advances previously
made in the amount of $____________ will) not be ultimately
recoverable.
______________________________________________________________
Mortgagor Identifying Number
______________________________________________________________
Mortgagor Identifying Number
______________________________________________________________
Mortgagor Identifying Number
( )
By: _______________________________
Name:
Title:
EXHIBIT I
EXCEPTIONS TO THE PRIMARY MORTGAGE INSURANCE POLICY
REPRESENTATIONS
K-1
EXHIBIT J
COMPANY'S OFFICER'S CERTIFICATE
I, ____________________, hereby certify that I am the duly elected
(Vice) President of (COMPANY), a federally chartered institution organized
under the laws of the United States, (the "Company") and further as follows:
1. Attached hereto as Exhibit A is a true, correct and
complete copy of the 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 (Cut-off Date).
2. Attached hereto as Exhibit B is an original certificate of
corporate existence of the Company, issued within ten days of the date
hereof, and no event has occurred since the date thereof which would
impair such existence.
3. Attached hereto as Exhibit C 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 the Purchase
and Servicing Agreement (as defined below) by original signature, 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 (Date).
4. 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 Mortgage Loan Sale and Servicing Agreement, dated
as of November 1, 1996 (the "Purchase and Servicing Agreement"), by and
among the Company, Fleet Mortgage Corp., and Xxxxxx Capital, a Division
of Xxxxxx Brothers Holdings Inc. (the "Purchaser") or the sale of the
mortgage loans or the consummation of the transactions contemplated
by the Purchase and Servicing Agreement; or (ii) any required consent,
approval, authorization or order has been obtained by the Company.
5. Neither the consummation of the transactions contemplated by,
nor the fulfillment of the terms of the Purchase and 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 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.
6. 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 and 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 and Servicing Agreement.
7. Each person listed on Exhibit E attached hereto who,
as an officer or representative of the Company, signed (a) the Purchase
and Servicing Agreement and (b) any other document delivered prior hereto
or on the date hereof in connection with any purchase described in the
Agreement 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 E, and the signatures of such persons appearing
on such documents are their genuine signatures.
8. The Company is duly authorized to engage in the transactions
described and contemplated in the Purchase and Servicing Agreement.
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
EXHIBIT E to
Company's Officer's Certificate
Name Title Signature
EXHIBIT K
SERVICER-S OFFICER-S CERTIFICATE
I, ____________________, hereby certify that I am the duly elected
(Vice) President of (SERVICER), a corporation organized under the laws of the
(state of ____________), (the "Servicer") and further as follows:
1. Attached hereto as Exhibit A is a true, correct and
complete copy of the charter of the Servicer which is in full force
and effect on the date hereof.
2. Attached hereto as Exhibit B is a true, correct and
complete copy of the bylaws of the Servicer which are in effect on
the date hereof.
3. Attached hereto as Exhibit C is an original certificate of
corporate existence of the Servicer, 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 D is a true, correct and
complete copy of the corporate resolutions of the Board of Directors of
the Servicer authorizing the Servicer to execute and deliver the Purchase
and Servicing Agreement (as hereinafter defined) by original signature,
and such resolutions are in effect on the date hereof and have been
in effect without amendment, waiver rescission or modification
since (Date).
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 Servicer of or compliance by
the Servicer with the Mortgage Loan Sale and Servicing Agreement,
dated as of November 1, 1996 (the "Purchase and Servicing Agreement"),
by and among the Servicer, Household Bank, F.S.B. and Xxxxxx Capital,
a Division of Xxxxxx Brothers Holdings Inc. (the "Purchaser"), or the
consummation of the transactions contemplated by the Purchase and
Servicing Agreement; or (ii) any required consent, approval, authorization
or order has been obtained by the Servicer.
6. Neither the consummation of the transactions contemplated by,
nor the fulfillment of the terms of the Purchase and 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 articles of
incorporation or by-laws of the Servicer, to the best of my knowledge
the terms of any indenture or other agreement or instrument to which the
Servicer 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 Servicer
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 Servicer
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
Servicer or in any material impairment of the right or ability of the
Servicer to carry on its business substantially as now conducted or
which would draw into question the validity of the Purchase and
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 Servicer to
perform under the terms of the Purchase and Servicing Agreement.
8. Each person listed on Exhibit E attached hereto who,
as an officer or representative of the Servicer, signed the Purchase
and Servicing Agreement, 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 Servicer, who holds the office set forth
opposite his or her name on Exhibit E, and the signatures of such persons
appearing on such documents are their genuine signatures.
9. The Servicer is duly authorized to engage in the transactions
described and contemplated in the Purchase and Servicing Agreement.
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the seal
of the Servicer.
Dated: By:
Name:
(Seal) Title: (Vice) President
I, ________________________, an (Assistant) Secretary of
(SERVICER), hereby certify that ____________ is the duly elected,
qualified and acting (Vice) President of the Servicer 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
EXHIBIT E to
Servicer's Officer's Certificate
Name Title Signature
EXHIBIT L
(FORM OF OPINION OF COUNSEL FROM THE COMPANY)
(date)
Lehman Capital, a Division of
Xxxxxx Brothers Holdings Inc.
American Express Tower, 8th Floor
World Financial Center
Xxx Xxxx, Xxx Xxxx 00000-0000
Dear Sirs:
You have requested (our) (my) opinion, as (Assistant) General
Counsel to (COMPANY) (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 Sale and Servicing Agreement by and among the
Company, Fleet Mortgage Corp. and Xxxxxx Capital, a Division of Xxxxxx Brothers
Holdings Inc. (the "Purchaser"), dated as of November 1, 1996 (the "Purchase
and Servicing Agreement"). Capitalized terms not otherwise defined herein
have the meanings set forth in the Purchase and Servicing Agreement.
(We) (I) have examined the following documents:
1. the Purchase and Servicing Agreement;
2. the form of Assignment of Mortgage;
3. the form of endorsement of the Mortgage Notes; and
4. 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 contained in the Purchase and Servicing Agreement. (We) (I) have
assumed the authenticity of all documents submitted to me
as originals, the genuineness of all signatures, the legal capacity
of natural persons and the conformity to the originals of all documents.
Based upon the foregoing, it is (our) (my) opinion that:
1. The Company is a federally chartered savings bank duly
organized, validly existing and in good standing under the laws
of the United States and is qualified to transact business in,
and is in good standing under, the laws of each state in
which a Mortgaged Property is located or is otherwise exempt
from such qualifications.
2. The Company has the power to engage in the transactions
contemplated by the Purchase and Servicing Agreement and all
requisite power, authority and legal right to execute and
deliver the Purchase and Servicing Agreement and the Mortgage
Loans and to perform and observe the terms and conditions of
such instruments.
3. The Purchase and Servicing Agreement has been duly authorized,
executed and delivered by the Company and is a legal, valid and
binding agreement enforceable in accordance with its
respective terms against the Company, 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 inter-
fere with the realization of the benefits provided thereunder
or with the Purchaser's ownership of the Mortgage Loans.
4. The Company 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
Purchase and Servicing Agreement and 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 of or
compliance by the Company with the Purchase and Servicing
Agreement or the sale and delivery of the Mortgage Loans or
the consummation of the transactions contemplated by the
Purchase and Servicing Agreement; 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 and Servic-
ing Agreement or the Mortgage Loans 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 violates any statute or
order, rule, regulations, writ, injunction or decree of any
court, governmental authority or regulatory body to which the
Company is subject or by which it is bound.
7. There is no action, suit, proceeding or investigation pending
or, to the best of my knowledge, 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 and 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 and Servicing Agreement or
the Mortgage Loans.
8. The sale of each Mortgage Note and Mortgage as and in the
manner contemplated by the Purchase and Servicing Agreement
is sufficient fully to transfer to the Purchaser all right,
title and interest of the Company thereto as noteholder and
mortgagee.
9. To the best of my knowledge, upon due inquiry, the
Mortgages have been duly assigned and the Mortgage Notes have
been duly endorsed as provided in the Purchase and Servicing
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
EXHIBIT M
(FORM OF OPINION OF COUNSEL FROM THE SERVICER)
(date)
Lehman Capital, a Division of
Xxxxxx Brothers Holdings Inc.
American Express Tower, 8th Floor
World Financial Center
Xxx Xxxx, Xxx Xxxx 00000-0000
Dear Sirs:
You have requested my opinion, as Counsel to Fleet Mortgage Corp.
(the "Servicer"), with respect to certain matters
in connection with the assumption of servicing responsibilities by
the Servicer of the Mortgage Loans pursuant to that certain Mortgage Loan
Sale and Servicing Agreement by and among the Servicer, Household Bank,
F.S.B. and Xxxxxx Capital, a Division of
Xxxxxx Brothers Holdings Inc. (the "Purchaser"), dated as of
November 1, 1996 (the "Purchase and Servicing Agreement"). Capitalized terms
not otherwise defined herein have the meanings set forth in the Purchase and
Servicing Agreement.
(We) (I) have examined the following documents:
1. the Purchase and Servicing Agreement; and
2. 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
Servicer contained in the Purchase and Servicing Agreement. (We)
(I) have assumed the authenticity of all documents submitted to me
as originals, the genuineness of all signatures, the legal capacity
of natural persons and the conformity to the originals of all documents.
Based upon the foregoing, it is (our) (my) opinion that:
1. The Servicer is a corporation duly organized, validly existing
and in good standing under the laws of the South
Carolina.
2. The Servicer has the power to engage in the transactions
contemplated by the Purchase and Servicing Agreement and all requisite power,
authority and legal right to execute and deliver the Purchase and Servicing
Agreement and to perform and observe the terms and conditions of such
instruments.
3. The Purchase and Servicing Agreement has been duly
authorized, executed and delivered by the Servicer and assuming that the laws
of New York are the same as the laws of South Carolina is a legal, valid and
binding agreement enforceable in accordance with its respective terms against
the Servicer, 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 (regardless of whether such enforcement is sought in
a proceeding in equity or at law).
4. The 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 Purchase and Servicing
Agreement.
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 Servicer of or compliance by the Servicer with the
Purchase and Servicing Agreement or (ii) any required consent, approval,
authorization or order has been obtained by the Servicer.
6. Neither the consummation of the transactions contemplated by,
nor the fulfillment of the terms of, the Purchase and 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 articles of incorporation
or by-laws of the Servicer, the terms of any indenture or other agreement or
instrument known by me to which the 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 Servicer is subject or by which it is bound.
7. There is no action, suit, proceeding or investigation pending
or, to the best of my knowledge, threatened against the Servicer which, in my
judgment, either in any one instance or in the aggregate, is likely to result
in any material adverse change in the business, operations, financial xxxxxx-
ion, 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 which would draw into question the validity of the Purchase and
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 Servicer to perform
under the terms of the Purchase and Servicing Agreement.
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
EXHIBIT N
SECURITY RELEASE CERTIFICATION
___________________, 199_
Federal Home Loan Bank of
Attention:
Re: Notice of Sale and Release of Collateral
Dear Sirs:
This letter serves as notice that (COMPANY), a (state) (federally)
chartered savings and loan association (in the state of
___________) (the "Association") has committed to sell to Xxxxxx Capital, a
Division of Xxxxxx Brothers Holdings Inc. ("LCC") under
a Mortgage Loan Sale and Servicing Agreement dated as of November
1, 1996, certain mortgage loans originated by the Association. The
Association warrants that the mortgage loans to be sold to LCC are
in addition to and beyond any collateral required to secure
advances made by you to the Association.
The Association acknowledges that the mortgage loans to
be sold to LCC shall not be used as additional or substitute collateral for
advances made by you. LCC understands that the balance of the Association's
mortgage loan portfolio may be used as collateral or additional collateral for
advances made by you, and confirms that it has no interest therein.
Execution of this letter by the Federal Home Loan Bank of
_________________________ shall constitute a full and complete release of any
security interest, claim, or lien which the Federal
Home Loan Bank of _____________________ may have against the mortgage loans
to be sold to LCC.
Very truly yours,
(COMPANY)
By:
Name:
Title:
Date:
Acknowledged and approved:
FEDERAL HOME LOAN BANK OF
By:
Name:
Title:
Date:
EXHIBIT O
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 Xxxxxx Capital, a Division of Xxxxxx Brothers
Holdings Inc. from the Company named below pursuant to that certain Mortgage
Loan Sale and Servicing Agreement, dated as of November 1, 1996, 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 Lehman Capital, a Division of Xxxxxx Brothers
Holdings Inc.
Name and Address of Financial Institution
(name)
(Address)
By:
II. Certification of Release
The Company named below hereby certifies to Lehman Capital, a
Division of Xxxxxx Brothers Holdings Inc. that, as of
the date and time of the sale of the above-mentioned Mortgage Loans
to Xxxxxx Capital, a Division of Xxxxxx Brothers Holdings 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.
(SELLER)
By:
Title:
Date:
