EXHIBIT 99.2
Exhibit 99.2
EXECUTION COPY
COUNTRYWIDE HOME LOANS, INC.
Seller
CWABS, INC.
Purchaser
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PURCHASE AGREEMENT
Dated as of June 28, 2002
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REVOLVING HOME EQUITY LOAN ASSET BACKED NOTES
Series 2002-D
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Table of Contents
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Page
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ARTICLE I
DEFINITIONS
Section 1.01. Definitions.............................................1
ARTICLE II
SALE OF MORTGAGE LOANS; PAYMENT OF PURCHASE PRICE
Section 2.01. Sale of the Mortgage Loans..............................2
Section 2.02. Obligations of Seller Upon Sale.........................3
Section 2.03. Payment of Purchase Price for the Mortgage Loans........6
ARTICLE III
REPRESENTATIONS AND WARRANTIES; REMEDIES FOR BREACH
Section 3.01. Seller Representations and Warranties...................6
Section 3.02. Seller Representations and Warranties Relating to the
Mortgage Loans..........................................7
ARTICLE IV
SELLER'S COVENANTS
Section 4.01. Covenants of the Seller................................15
ARTICLE V
SERVICING
Section 5.01. Servicing..............................................16
ARTICLE VI
TERMINATION
Section 6.01. Termination............................................16
ARTICLE VII
MISCELLANEOUS PROVISIONS
Section 7.01. Amendment..............................................16
Section 7.02. Governing Law..........................................16
Section 7.03. Notices................................................16
Section 7.04. Severability of Provisions.............................17
Section 7.05. Counterparts...........................................17
Section 7.06. Further Agreements.....................................17
Section 7.07. Successors and Assigns: Assignment of Purchase
Agreement..............................................17
Section 7.08. Survival...............................................18
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THIS PURCHASE AGREEMENT, dated as of June 28, 2002 (the "Agreement"),
between COUNTRYWIDE HOME LOANS, INC., a New York corporation (the "Seller"),
and CWABS, INC., a Delaware corporation (the "Purchaser"),
W I T N E S S E T H:
WHEREAS, the Seller is the owner of the mortgage notes or other evidence
of indebtedness indicated on Schedule I and certain other mortgage notes or
other evidence of indebtedness made or to be made in the future, and Related
Documentation; and
WHEREAS, by the date of their transfer, the Seller will own the
mortgages on the properties securing the Mortgage Loans, including rights to
(a) any property acquired by foreclosure or deed in lieu of foreclosure or
otherwise and (b) the proceeds of any hazard insurance policies on the
Mortgaged Properties; and
WHEREAS, the Seller wants to sell the Mortgage Loans to the Purchaser
pursuant to this Agreement; and
WHEREAS, pursuant to the Sale and Servicing Agreement, of even date with
this Agreement (the "Sale and Servicing Agreement"), among the Purchaser, as
depositor, the Seller, as sponsor and master servicer, the Trust, and the
Indenture Trustee, the Purchaser will transfer the Mortgage Loans to the
Trust;
NOW, THEREFORE, the parties agree as follows.
ARTICLE I
DEFINITIONS
Section 1.01 Definitions.
Capitalized terms used in this Agreement that are not otherwise defined
have the meanings given to them in the Indenture, and if not defined there, in
the Sale and Servicing Agreement. In addition, Section 1.04 (Rules of
Construction) of the Indenture is incorporated by reference with appropriate
substitution of this Agreement for references in that Section to the Indenture
so that the language of that Section will read appropriately as applying to
this Agreement.
ARTICLE II
SALE OF MORTGAGE LOANS; PAYMENT OF PURCHASE PRICE
Section 2.01 Sale of the Mortgage Loans.
(a) The Initial Mortgage Loans. Concurrently with the execution and
delivery of this Agreement, the Seller hereby transfers to the Purchaser,
without recourse, all of its right, title and interest existing now or in the
future in,
(i) each Initial Mortgage Loan, including its Asset Balance
(including all Additional Balances) and all collections received on it
after the applicable Cut-off Date (excluding payments due by the
applicable Cut-off Date);
(ii) property that secured a Mortgage Loan that is acquired by
foreclosure or deed in lieu of foreclosure;
(iii) the Seller's rights under the hazard insurance policies;
(iv) all rights under any guaranty executed in connection with a
Mortgage Loan;
(v) all other assets included or to be included in the Trust
for the benefit of the Noteholders and the Credit Enhancer; and
(vi) all proceeds of the foregoing.
(b) By the sale of the Mortgage Loan and its Additional Balances, the
Seller has sold to the Purchaser, and the Purchaser has purchased from the
Seller, each future draw of new borrowing under the related Credit Line
Agreement. The Purchaser shall pay the Seller for each Additional Balance in
cash in an amount equal to the principal amount of the Additional Balance as
it arises. The Trust, the Seller, and the Purchaser may agree to a netting
arrangement in connection with this transaction, when appropriate, rather than
actually moving cash.
(c) The Additional Home Equity Loans. The Purchaser may use the funds in
each Additional Loan Account to purchase Additional Home Equity Loans on any
Subsequent Closing Date designated by the Purchaser by the Latest Subsequent
Closing Date. On each Subsequent Closing Date, the Seller shall deliver a
Transfer Document (properly completed and executed by the Seller) to the
Purchaser. When the Seller delivers a Transfer Document, the Seller hereby
transfers to the Purchaser without recourse, and the Purchaser purchases and
shall effect payment for, all of its right, title and interest in each
Additional Home Equity Loan identified in the Transfer Document, including its
Asset Balance (including all Additional Balances) and all collections received
on it after the relevant Subsequent Cut-off Date (excluding payments due by
the Subsequent Cut-off Date) and all proceeds of the foregoing.
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Section 2.02 Obligations of Seller Upon Sale.
In connection with any transfer pursuant to Section 2.01, the Seller
further agrees, at its own expense:
(a) to deliver to the Purchaser by the Closing Date a Mortgage Loan
Schedule containing an accurate list of all Initial Mortgage Loans, specifying
for each Initial Mortgage Loan, among other things, its account number and its
Cut-off Date Asset Balance;
(b) to indicate in its books and records that the Mortgage Loans have
been sold to the Indenture Trustee, as assignee of the Purchaser, pursuant to
this Agreement by the Closing Date for the Initial Mortgage Loans, and by each
Subsequent Closing Date for the related Additional Home Equity Loans;
(c) to deliver to the Purchaser, or at the Purchaser's direction to the
Indenture Trustee, the Owner Trustee, and the Credit Enhancer, an Officer's
Certificate confirming the satisfaction of each of the conditions precedent in
Section 2.01(c) of the Sale and Servicing Agreement by each Subsequent Closing
Date; and
(d) to deliver to the Purchaser, or at the Purchaser's direction to the
Indenture Trustee, a revised Mortgage Loan Schedule reflecting the addition of
the Additional Home Equity Loans within 15 days following each Subsequent
Closing Date.
The initial Mortgage Loan Schedule is Exhibit A to the Sale and
Servicing Agreement and shall also be marked as Schedule I to this Agreement
and is hereby incorporated into this Agreement.
The Seller agrees to perfect and protect the Purchaser's interest in
each Mortgage Loan and its proceeds by preparing, executing, and filing a
UCC-1 Financing Statement with the Secretary of State in the State of New York
describing the Mortgage Loans and naming the Seller as debtor and the
Purchaser as secured party and indicating that the Mortgage Loans have been
assigned to the Trust and all necessary Continuation Statements and any
additional UCC-1 financing statements due to a change in the name or the state
of incorporation of the Seller. The Financing Statement shall be filed by the
Closing Date. This Financing Statement will state in bold-faced type that a
purchase of the Mortgage Loans included in the collateral covered by the
Financing Statement from the debtor will violate the rights of the secured
party and its assignee.
The Purchaser agrees to perfect and protect the Trust's interest in each
Mortgage Loan and its proceeds by preparing, executing, and filing a UCC-1
Financing Statement with the Secretary of State in the State of Delaware
describing the Mortgage Loans and naming the Purchaser as debtor and the Trust
as secured party (and indicating that the Mortgage Loans have been pledged to
the Indenture Trustee) and all necessary Continuation Statements and any
additional UCC-1 financing statements due to a change in the name or the state
of incorporation
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of the Purchaser. The Financing Statement shall be filed by the Closing Date.
This Financing Statement will state in bold-faced type that a purchase of the
Mortgage Loans included in the collateral covered by the Financing Statement
from the debtor will violate the rights of the secured party and its assignee.
In connection with any transfer by the Seller, the Seller shall deliver
to the order of the Purchaser the following documents for each Mortgage Loan
(the "Related Documentation"):
(i) the original Mortgage Note endorsed in blank or, if the original
Mortgage Note has been lost or destroyed and not replaced, an original
lost note affidavit from the Seller stating that the original Mortgage
Note was lost, misplaced, or destroyed, together with a copy of the
related Mortgage Note;
(ii) unless the Mortgage Loan is registered on the MERS(R)System, an
original assignment of mortgage in blank in recordable form;
(iii) the original recorded mortgage with evidence of recording on
it (noting the presence of the MIN of the Mortgage Loan and language
indicating that the Mortgage Loan is a MOM Loan if the Mortgage Loan is a
MOM Loan) or, if the original recorded mortgage with evidence of
recording on it cannot be delivered by the Closing Date because of a
delay caused by the public recording office where the original Mortgage
has been delivered for recordation or because the original Mortgage has
been lost, the Seller shall deliver to the Indenture Trustee an accurate
copy of the mortgage, together with (i) when the delay is caused by the
public recording office, an Officer's Certificate of the Seller or the
Purchaser stating that the original mortgage has been dispatched to the
appropriate public recording official or (ii) when the original mortgage
has been lost, a certificate by the appropriate county recording office
where the mortgage is recorded;
(iv) any original intervening assignments needed for a complete
chain of title to the Trust with evidence of recording on them, or, if
any original intervening assignment has not been returned from the
applicable recording office or has been lost, an accurate copy of it,
together with (i) when the delay is caused by the public recording
office, an Officer's Certificate of the Seller or the Purchaser stating
that the original intervening assignment has been dispatched to the
appropriate public recording official for recordation or (ii) when the
original intervening assignment has been lost, a certificate by the
appropriate county recording office where the mortgage is recorded;
(v) a title policy for each Mortgage Loan with a Credit Limit in
excess of $100,000;
(vi) the original of any guaranty executed in connection with the
Mortgage Note;
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(vii) the original of each assumption, modification, consolidation,
or substitution agreement relating to the Mortgage Loan; and (viii) any
security agreement, chattel mortgage, or equivalent instrument executed
in connection with the Mortgage.
The Related Documentation for the Initial Mortgage Loans will be
delivered:
(i) no later than the Closing Date, with respect to no less than 50%
of the Initial Mortgage Loans,
(ii) no later than the twentieth day after the Closing Date, with
respect to no less than 40% of the Initial Mortgage Loans in addition to
those delivered on the Closing Date, and
(iii) within thirty days following the Closing Date, with respect to
the remaining Initial Mortgage Loans.
The Related Documentation for the Additional Home Equity Loans will be
delivered:
(i) no later than the twentieth day after the relevant Subsequent
Closing Date, with respect to no less than 80% of the relevant Additional
Home Equity Loans; and
(ii) within thirty days following the relevant Subsequent Closing
Date, with respect to the remaining relevant Additional Home Equity
Loans.
The Seller confirms to the Purchaser that, as of the Closing Date, it
has caused the portions of the Electronic Ledger relating to the Initial
Mortgage Loans maintained by the Seller to be clearly and unambiguously marked
to indicate that the Initial Mortgage Loans have been sold to the Purchaser,
and sold by the Purchaser to the Trust, and Granted by the Trust to the
Indenture Trustee. By the relevant Subsequent Closing Date or applicable date
of substitution, as applicable, the Seller shall cause the portions of the
Electronic Ledgers relating to the relevant Additional Home Equity Loans or
Eligible Substitute Mortgage Loans, as the case may be, to be clearly and
unambiguously marked, and shall make appropriate entries in its general
accounting records, to indicate that those Mortgage Loans have been
transferred to the Trust at the direction of the Purchaser and that they have
been Granted by the Trust to the Indenture Trustee, and that a purchase of the
Mortgage Loans from the Seller or the Purchaser will violate the rights of the
Trust, as secured party with respect to those Mortgage Loans.
The Purchaser accepts all right, title and interest of the Seller
existing now or in the future in the Mortgage Loans and other property
transferred to it pursuant to this Section.
Notwithstanding the characterization of the Notes as debt for federal,
state, and local income and franchise tax purposes, the transfer of the
Mortgage Loans is a sale by the Seller to the Purchaser of all the Seller's
interest in the Mortgage Loans and other property described
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above. However, if the transfer were to be characterized as a transfer for
security and not as a sale, then the Seller hereby Grants to the Purchaser a
Security Interest in all of the Seller's right, title and interest in the
Mortgage Loans and other property described above, whether existing now or in
the future, to secure all of the Seller's obligations under this Agreement,
and this Agreement shall constitute a Security Agreement under applicable law.
Section 2.03......Payment of Purchase Price for the Mortgage Loans.
(a) In
consideration of the sale of the Initial Mortgage Loans from the Seller to the
Purchaser on the Closing Date, the Purchaser agrees to transfer to the Seller
on the Closing Date the purchase price for the Initial Mortgage Loans provided
in the Adoption Annex.
(b) In consideration of the sale of the Additional Home
Equity Loans from the Seller to the Purchaser on each Subsequent Closing Date,
the Purchaser agrees to cause the Trust to pay to the Seller, when the
conditions to the release of the purchase price for the Additional Home Equity
Loans under the Sale and Servicing Agreement have been met, an amount equal to
their Cut-off Date Asset Balance.
ARTICLE III
REPRESENTATIONS AND WARRANTIES; REMEDIES FOR BREACH
Section 3.01 Seller Representations and Warranties.
The Seller represents and warrants to the Purchaser as of the Closing
Date:
(a) The Seller is a New York corporation, validly existing and in good
standing under the laws of the State of New York, and has the corporate power
to own its assets and to transact the business in which it is currently
engaged. The Seller is duly qualified to do business as a foreign corporation
and is in good standing in each jurisdiction in which the character of the
business transacted by it or any properties owned or leased by it requires
such qualification and in which the failure so to qualify would have a
material adverse effect on the business, properties, assets, or condition
(financial or other) of the Seller;
(b) The Seller has the power and authority to make, execute, deliver,
and perform this Agreement and all of the transactions contemplated by this
Agreement, and has taken all necessary corporate action to authorize the
execution, delivery, and performance of this Agreement. When executed and
delivered, this Agreement will constitute the valid and legally binding
obligation of the Seller enforceable in accordance with its terms;
(c) The Seller is not required to obtain the consent of any other party
or any consent, license, approval or authorization from, or registration or
declaration with, any governmental authority, bureau, or agency in connection
with the execution, delivery,
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performance, validity, or enforceability of this Agreement, except for any
consents, licenses, approvals or authorizations, or registrations or
declarations, that have been obtained or filed, as the case may be, before the
Closing Date;
(d) The execution, delivery, and performance of this Agreement by the
Seller will not violate any provision of any existing law or regulation or any
order or decree of any court applicable to the Seller or any provision of the
certificate of incorporation or bylaws of the Seller, or constitute a material
breach of any mortgage, indenture, contract, or other agreement to which the
Seller is a party or by which the Seller may be bound; and
(e) No litigation or administrative proceeding of or before any court,
tribunal, or governmental body is currently pending, or to the knowledge of
the Seller threatened, against the Seller or any of its properties or with
respect to this Agreement or the Notes that in the opinion of the Seller has a
reasonable likelihood of resulting in a material adverse effect on the
transactions contemplated by this Agreement.
The representations and warranties in this Section shall survive the
transfer of the Mortgage Loans to the Purchaser. The Seller shall cure a
breach of any representations and warranties in accordance with the Sale and
Servicing Agreement. The remedy specified in the Sale and Servicing Agreement
shall constitute the sole remedy against the Seller respecting any breach.
Section 3.02 Seller Representations and Warranties Relating to the
Mortgage Loans.
The Seller represents and warrants to the Purchaser as of the Cut-off
Date, unless otherwise specifically set forth in this Agreement:
(i) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, this Agreement
constitutes a valid and legally binding obligation of the Seller,
enforceable against the Seller in accordance with its terms.
(ii) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, either
(A) this Agreement constitutes a valid transfer to the
Purchaser of all right, title and interest of the Seller in the
applicable Mortgage Loans, all monies due or to become due on them
(excluding payments of accrued interest due by the Initial Cut-off
Date or Subsequent Cut-off Date, as applicable), all proceeds of the
applicable Mortgage Loans, and any funds from time to time
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deposited in the Collection Account (excluding investment earnings
on the funds) and all other property specified in Section 2.01(a) or
(b) of the Sale and Servicing Agreement, as applicable, and the Sale
and Servicing Agreement constitutes a valid transfer to the Trust of
the foregoing property such that, on execution of the Sale and
Servicing Agreement, it is owned by the Trust free of all liens and
other encumbrances, and is part of the corpus of the Trust
transferred to the Trust by the Purchaser, and upon payment for the
Additional Balances, this Agreement and the Sale and Servicing
Agreement will constitute a valid transfer to the Trust of all
interest of the Seller in the Additional Balances, all monies due or
to become due on them, all proceeds of the Additional Balances, and
all other property specified in Section 2.01(a) of the Sale and
Servicing Agreement relating to the Additional Balances free of all
liens and other encumbrances, and the Indenture constitutes a valid
Grant of a Security Interest to the Indenture Trustee in that
property, and the Indenture Trustee has a first priority perfected
Security Interest in the property, subject to the effect of Section
9-315 of the UCC with respect to collections on the Mortgage Loans
that are deposited in the Collection Account in accordance with the
next to last paragraph of Section 3.02(b) of the Sale and Servicing
Agreement, or
(B) this Agreement and the Sale and Servicing Agreement
constitute a Grant of a Security Interest to the Owner Trustee on
behalf of the Trust and the Indenture constitutes a Grant of a
Security Interest to the Indenture Trustee in the property described
in Clause (A) above. If this Agreement and the Sale and Servicing
Agreement constitute the Grant of a Security Interest to the Trust
and the Indenture constitutes a Grant of a Security Interest to the
Indenture Trustee in such property, the Indenture Trustee will have
a perfected Security Interest in the property, subject to the effect
of Section 9-315 of the UCC with respect to collections on the
Mortgage Loans that are deposited in the Collection Account in
accordance with the next to last paragraph of Section 3.02(b) of the
Sale and Servicing Agreement. This Security Interest is enforceable
as such against creditors of and purchasers from the Trust, the
Purchaser, and the Seller.
(iii) The Seller has not authorized the filing of and is not aware
of any financing statements against the Seller that include a description
of collateral covering the Collateral other than any financing statement
(A) relating to the Security Interests granted to the Depositor, the
Trust, or the Indenture Trustee hereunder, pursuant to the Sale and
Servicing Agreement or pursuant to the Indenture, (B) that has been
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terminated, or (C) that names of the Depositor, the Trust, or the
Indenture Trustee as secured party.
(iv) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan and as of the date
any Additional Balance is created, the information in the Mortgage Loan
Schedule for the Mortgage Loans is correct in all material respects.
(v) The applicable Mortgage Loan has not been assigned or pledged,
and the Seller is its sole owner and holder free of any liens, claims,
encumbrances, participation interests, equities, pledges, charges, or
security interests of any nature, and has full authority, under all
governmental and regulatory bodies having jurisdiction over the ownership
of the applicable Mortgage Loan, to transfer it pursuant to this
Agreement.
(vi) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, the related
Mortgage Note and the mortgage for each Mortgage Loan have not been
assigned or pledged, and immediately before the sale of the Mortgage
Loans to the Purchaser, the Seller was the sole owner and holder of the
Mortgage Loan free of any liens, claims, encumbrances, participation
interests, equities, pledges, charges, or security interests of any
nature, and has full authority, under all governmental and regulatory
bodies having jurisdiction over the ownership of the applicable Mortgage
Loans, to transfer it pursuant to this Agreement.
(vii) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, the related
mortgage is a valid and subsisting first or second lien on the property
described in it, as shown on the Mortgage Loan Schedule with respect to
each related Mortgage Loan, and as of the Cut-off Date, relevant
Subsequent Cut-off Date, or date of substitution, as applicable, the
related Mortgaged Property is free of all encumbrances and liens having
priority over the first or second lien, as applicable, of the mortgage
except for liens for
(A) real estate taxes and special assessments not yet
delinquent;
(B) any first mortgage loan secured by the Mortgaged Property
and specified on the Mortgage Loan Schedule;
(C) covenants, conditions and restrictions, rights of way,
easements, and other matters of public record as of the date of
recording that are acceptable to mortgage lending institutions
generally; and
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(D) other matters to which like properties are commonly subject
that do not materially interfere with the benefits of the security
intended to be provided by the mortgage.
(viii) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, no obligor has a
valid offset, defense, or counterclaim under any Credit Line Agreement or
mortgage.
(ix) To the best knowledge of the Seller, as of the Closing Date
with respect to the Initial Mortgage Loans, the relevant Subsequent
Closing Date with respect to any Additional Home Equity Loans, and the
applicable date of substitution with respect to any Eligible Substitute
Mortgage Loan, no related Mortgaged Property has any delinquent recording
or other tax or fee or assessment lien against it.
(x) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, no proceeding is
pending or, to the best knowledge of the Seller, threatened for the total
or partial condemnation of the related Mortgaged Property, and the
property is free of material damage;
(xi) To the best knowledge of the Seller, as of the Closing Date
with respect to the Initial Mortgage Loans, the relevant Subsequent
Closing Date with respect to any Additional Home Equity Loans, and the
applicable date of substitution with respect to any Eligible Substitute
Mortgage Loan, no mechanics' or similar liens or claims have been filed
for work, labor, or material affecting the related Mortgaged Property
that are, or may be, liens prior or equal to the lien of the related
mortgage, except liens that are fully insured against by the title
insurance policy referred to in clause (xiv).
(xii) As of the Initial Cut-off Date, no Minimum Monthly Payment on
an Initial Mortgage Loan is more than 59 days delinquent (measured on a
contractual basis) and no Minimum Monthly Payment on any other Mortgage
Loan being transferred on the relevant Subsequent Closing Date or
applicable date of substitution, as applicable, is more than 30 days
delinquent (measured on a contractual basis) and no more than the
percentage specified in the Adoption Annex of the Initial Mortgage Loans
being transferred on the relevant date (by Cut-off Date Loan Balance)
were 30-59 days delinquent (measured on a contractual basis).
(xiii) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage
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Loan, for each Mortgage Loan, the related Mortgage File contains each of
the documents specified to be included in them.
(xiv) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, the related
Mortgage Note and the related mortgage at origination complied in all
material respects with applicable state and federal laws, including
usury, truth-in-lending, real estate settlement procedures, consumer
credit protection, equal credit opportunity, or disclosure laws
applicable to the Mortgage Loan, and the servicing practices used by the
Seller with respect to each Mortgage Loan have been consistent with the
practices and the degree of skill and care the Seller exercises in
servicing for itself loans that it owns that are comparable to the
Mortgage Loans.
(xv) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, either a lender's
title insurance policy or binder was issued on the date of origination of
the Mortgage Loan being transferred on the relevant date and each policy
is valid and remains in full force, or a title search or guaranty of
title customary in the relevant jurisdiction was obtained with respect to
a Mortgage Loan as to which no title insurance policy or binder was
issued.
(xvi) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, none of the
Mortgaged Properties is a mobile home or a manufactured housing unit that
is not considered or classified as part of the real estate under the laws
of the jurisdiction in which it is located.
(xvii) As of the Initial Cut-off Date, no more than the percentage
specified in the Adoption Annex of the Initial Mortgage Loans, by
aggregate principal balance, are secured by Mortgaged Properties located
in one United States postal zip code.
(xviii) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, the Combined
Loan-to-Value Ratio for each Mortgage Loan was not in excess of the
percentage specified in the Adoption Annex.
(xix) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, no selection
procedure reasonably believed by the Seller to be adverse to the
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interests of the Transferor, the Noteholders, or the Credit Enhancer was
used in selecting the Mortgage Loans.
(xx) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, the Seller has not
transferred the Mortgage Loans to the Trust with any intent to hinder,
delay, or defraud any of its creditors.
(xxi) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, the Minimum
Monthly Payment with respect to any Mortgage Loan is not less than the
interest accrued at the applicable Loan Rate on the average daily Asset
Balance during the interest period relating to the date on which the
Minimum Monthly Payment is due.
(xxii) The Mortgage Notes constitute either "instruments" or
"general intangibles" as defined in the UCC.
(xxiii) By the Closing Date with respect to the Initial Mortgage
Loans and, to the extent not already included in the filing with respect
to the Mortgage Loans, within 10 days following the relevant Subsequent
Closing Date with respect to any Additional Home Equity Loans, and within
10 days following the applicable date of substitution with respect to any
Eligible Substitute Mortgage Loan, the Seller will file UCC-1 financing
statements with respect to the relevant Mortgage Loans in the proper
filing office in the appropriate jurisdiction to perfect the Security
Interest Granted hereunder.
(xxiv) The Mortgage Notes that constitute or evidence the Collateral
do not have any marks or notations indicating that they have been
pledged, assigned, or otherwise conveyed to any person other than the
Purchaser, the Trust, or the Indenture Trustee. All financing statements
filed or to be filed against the Seller in favor of the Purchaser, the
Trust, or the Indenture Trustee in connection with this Agreement, the
Sale and Servicing Agreement, or the Indenture describing the Collateral
contain a statement to the following effect: "A purchase of the Mortgage
Loans included in the collateral covered by this financing statement will
violate the rights of the Purchaser, the Trust, or the Indenture
Trustee."
(xxv) As of the Closing Date, the Seller will have received a
written acknowledgement from the Custodian that it is acting solely as
agent of the Indenture Trustee.
(xxvi) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage
12
Loan, each Credit Line Agreement and each Mortgage Loan is an enforceable
obligation of the related mortgagor.
(xxvii) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, the Seller has not
received a notice of default of any senior mortgage loan related to a
Mortgaged Property that has not been cured.
(xxviii) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, the definition of
"prime rate" in each Credit Line Agreement relating to a Mortgage Loan
does not differ materially from the definition in the form of Credit Line
Agreement in Exhibit B of the Sale and Servicing Agreement.
(xxix) The weighted average remaining term to maturity of the
Initial Mortgage Loans on a contractual basis as of the Initial Cut-off
Date is approximately the number of months specified in the Adoption
Annex. On each date that the Loan Rates have been adjusted, interest rate
adjustments on the Initial Mortgage Loans were made in compliance with
the related mortgage and Mortgage Note and applicable law. Over the term
of each Initial Mortgage Loan, the Loan Rate may not exceed the related
Loan Rate Cap. The Loan Rate Cap for the Initial Mortgage Loans ranges
between the percentages specified in the Adoption Annex and the weighted
average Loan Rate Cap is approximately the percentage specified in the
Adoption Annex. The Gross Margins for the Initial Mortgage Loans range
between the percentages specified in the Adoption Annex and the weighted
average Gross Margin is approximately the percentage specified in the
Adoption Annex as of the Cut-off Date for the Initial Mortgage Loans. The
Loan Rates on the Initial Mortgage Loans range between the percentages
specified in the Adoption Annex and the weighted average Loan Rate on the
Initial Mortgage Loans is approximately the percentage specified in the
Adoption Annex.
(xxx) As of the Closing Date with respect to the Initial Mortgage
Loans, the relevant Subsequent Closing Date with respect to any
Additional Home Equity Loans, and the applicable date of substitution
with respect to any Eligible Substitute Mortgage Loan, each Mortgaged
Property consists of a single parcel of real property with a one-to-four
unit single family residence erected on it, or an individual condominium
unit, planned unit development unit, or townhouse.
(xxxi) No more than the percentage specified in the Adoption Annex
(by Initial Cut-off Date Loan Balance) of the Initial Mortgage Loans are
secured by real property improved by individual condominium units, units
in planned unit developments, townhouses or two-to-four family residences
erected on them, and at
13
least the percentage specified in the Adoption Annex (by Initial Cut-off
Date Loan Balance) of the Mortgage Loans are secured by real property
with a detached one-family residence erected on them;
(xxxii) The Credit Limits on the Initial Mortgage Loans range
between approximately the dollar amounts specified in the Adoption Annex
with an average of approximately the dollar amount specified in the
Adoption Annex. As of the Initial Cut-off Date, no Initial Mortgage Loan
had a principal balance in excess of approximately the dollar amount
specified in the Adoption Annex and the average principal balance of the
Initial Mortgage Loans is equal to approximately the dollar amounts
specified in the Adoption Annex.
(xxxiii) Approximately the percentages specified in the Adoption
Annex of the Initial Mortgage Loans, by aggregate principal balance as of
the Initial Cut-off Date, are first and second liens.
(xxxiv) As of the Closing Date, no more than the percentage
specified in the Adoption Annex of the Initial Mortgage Loans, by
aggregate principal balance, were appraised electronically.
(xxxv) To the Seller's knowledge, the transfer of the Mortgage Loans
by the Seller pursuant to this Agreement is not subject to, and will not
result in any, tax, fee, or governmental charge payable by the Seller,
the Purchaser, the Trust, or the Indenture trustee to any federal, state,
or local government other than those that have or will be paid by the
Seller as due.
(xxxvi) To the Seller's knowledge, each Mortgaged Property is free
from any and all toxic or hazardous substances and no violation of any
local, state, or federal environmental law, rule, or regulation has
occurred.
If the substance of any representation or warranty under the Sale and
Servicing Agreement or in this Section made to the best of the Seller's
knowledge or as to which the Seller has no knowledge is inaccurate and the
inaccuracy materially and adversely affects the interest of the Purchaser or
its assignee in the related Mortgage Loan, then, notwithstanding that the
Seller did not know the substance of the representation and warranty was
inaccurate at the time the representation or warranty was made, the inaccuracy
shall be a breach of the applicable representation or warranty and the Seller
shall cure the breach, repurchase the Mortgage Loan, or substitute for the
Mortgage Loan in accordance with the Sale and Servicing Agreement.
The representations and warranties in this Section shall survive the
transfer and assignment of the Mortgage Loans to the Purchaser. The sole
remedy of the Purchaser, the Noteholders, the Indenture Trustee on behalf of
Noteholders, and the Credit Enhancer against the Seller for the breach of a
representation or warranty is the Seller's obligation to accept a transfer of
a Mortgage Loan as to which a breach has occurred and is continuing and to
make
14
any required deposit in the Collection Account or to substitute an Eligible
Substitute Mortgage Loan.
The Purchaser acknowledges that the Seller, as Master Servicer, in its
sole discretion, may purchase for its own account from the Trust any Mortgage
Loan that is 151 days or more delinquent. The price for any Mortgage Loan
purchased shall be calculated in the same manner as in Section 3.06 of the
Sale and Servicing Agreement and shall be deposited in the Collection Account.
When it receives a certificate from the Master Servicer in the form of Exhibit
D to the Sale and Servicing Agreement, the Trust shall release to the
purchaser of the Mortgage Loan the related Mortgage File and shall execute and
deliver any instruments of transfer prepared by the purchaser of the Mortgage
Loan, without recourse, necessary to vest in the purchaser of the Mortgage
Loan any Mortgage Loan released pursuant to this Agreement, and the purchaser
of the Mortgage Loan shall succeed to all the Trust's interest in the Mortgage
Loan and all security and documents. This assignment shall be an assignment
outright and not for security. The purchaser of the Mortgage Loan shall then
own the Mortgage Loan, and all security and documents, free of any further
obligation to the Trust, the Owner Trustee, the Indenture Trustee, the
Transferor, the Credit Enhancer, or the Noteholders with respect to it.
ARTICLE IV
SELLER'S COVENANTS
Section 4.01 Covenants of the Seller.
Except for the transfer under this Agreement, the Seller will not
transfer to any other person, or create or suffer to exist any Lien on any
Mortgage Loan, or any interest in one; the Seller will notify the Indenture
Trustee of the existence of any Lien on any Mortgage Loan immediately on its
discovery; and the Seller will defend the right, title and interest of the
Trust and the Indenture Trustee in the Mortgage Loans against all claims of
third parties claiming through the Seller. Nothing in this Section shall
prohibit the Seller from suffering to exist on any of the Mortgage Loans any
Liens for municipal or other local taxes and other governmental charges if
they are not due at the time or if the Seller is contesting their validity in
good faith by appropriate proceedings and set aside on its books adequate
reserves with respect to them.
15
ARTICLE V
SERVICING
Section 5.01 Servicing.
The Seller will be the Master Servicer of the Mortgage Loans pursuant to
of the Sale and Servicing Agreement.
ARTICLE VI
TERMINATION
Section 6.01 Termination.
The respective obligations of the Seller and the Purchaser created by
this Agreement shall terminate when the Indenture terminates in accordance
with its terms.
ARTICLE VII
MISCELLANEOUS PROVISIONS
Section 7.01 Amendment.
This Agreement may be amended from time to time by the Seller and the
Purchaser, with the written consent of the Credit Enhancer by written
agreement signed by the Seller and the Purchaser.
Section 7.02 Governing Law.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS PROVISIONS THAT WOULD
RESULT IN THE APPLICATION OF THE LAWS OF ANOTHER STATE.
Section 7.03 Notices.
All notices, demands, instructions, consents, and other communications
required or permitted under this Agreement shall be in writing and signed by
the party giving the same and shall be personally delivered or sent by first
class or express mail (postage prepaid), national overnight courier service,
or by facsimile transmission or other electronic communication device capable
of transmitting or creating a written record (confirmed by first class mail)
and shall be considered to be given for purposes of this Agreement on the day
that the writing is delivered when personally delivered or sent by facsimile
or overnight courier or three Business Days after it was sent to its intended
recipient if sent by first class mail. A facsimile has been delivered when the
sending machine issues an electronic confirmation of transmission. Unless
otherwise specified in a notice sent or delivered in accordance with the
provisions of this
16
Section, notices, demands, instructions, consents, and other communications in
writing shall be given to or made on the respective parties at their
respective addresses indicated below:
(i) if to the Seller at:
Countrywide Home Loans, Inc.
0000 Xxxx Xxxxxxx
Xxxxxxxxx, XX 00000
Ref: CWABS 2002-D
and
(ii) if to the Purchaser at:
CWABS, Inc.
0000 Xxxx Xxxxxxx
Xxxxxxxxx, XX 00000
Ref: CWABS 2002-D
Section 7.04 Severability of Provisions.
Any provisions of this Agreement that are held invalid for any reason or
unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of the invalidity or unenforceability without
invalidating the remaining provisions of this Agreement, and the prohibition
or unenforceability in a jurisdiction shall not invalidate or render
unenforceable that provision in any other jurisdiction.
Section 7.05 Counterparts.
This Agreement may be executed in any number of copies, and by the
different parties on the same or separate counterparts, each of which shall be
considered to be an original instrument. Section 7.06......Further Agreements.
The Purchaser and the Seller each agree to execute and deliver to the other
any additional documents appropriate to effectuate the purposes of this
Agreement or in connection with the issuance of the Notes.
Section 7.07 Successors and Assigns: Assignment of Purchase
Agreement.
This Agreement shall bind and inure to the benefit of and be enforceable
by the Seller, the Purchaser, the Trust, the Indenture Trustee, and the Credit
Enhancer. The obligations of the Seller under this Agreement cannot be
assigned or delegated to a third party without the consent of the Purchaser
and the Credit Enhancer, except that the Seller may assign its obligations
under this Agreement to any person into which the Seller is merged or any
corporation resulting from any merger, conversion, or consolidation to which
the Seller is a party or any person succeeding to the business of the Seller.
The Purchaser is acquiring the Mortgage Loans to further transfer them to the
Trust, and the Trust will Grant a Security Interest in them to the Indenture
Trustee
17
under the Indenture pursuant to which the Trust will issue a series of Notes
secured by the Mortgage Loans. As an inducement to the Purchaser to purchase
the Mortgage Loans, the Seller consents to the assignment by the Purchaser to
the Trust, and by the Trust to the Indenture Trustee of all of the Purchaser's
rights against the Seller under this Agreement insofar as they relate to
Mortgage Loans transferred to the Trust and to the enforcement or exercise of
any right against the Seller pursuant to this Agreement by the Indenture
Trustee under the Sale and Servicing Agreement and the Indenture. Enforcement
of a right by the Indenture Trustee shall have the same effect as if the right
had been exercised by the Purchaser directly.
Section 7.08 Survival.
The representations and warranties in Article III shall survive the
purchase of the Mortgage Loans.
18
IN WITNESS WHEREOF, the Seller and the Purchaser have caused this
Agreement to be duly executed by their respective officers as of the day and
year first above written.
CWABS, INC.
Purchaser
By: /s/__________________
Name:
Title: Vice President
COUNTRYWIDE HOME LOANS, INC.
Seller
By: /s/___________________
Name:
Title: Senior Vice President
19
SCHEDULE I
SCHEDULE OF
MORTGAGE LOANS
[Delivered to the Indenture Trustee only]
20
STATE OF California)
) ss.:
COUNTY OF Los Angeles)
On the [__] day of June 2002 before me, a Notary Public in and for said
State, personally appeared [____________], known to me to be a Vice President
of CWABS, Inc., the corporation that executed the within instrument, and also
known to me to be the person who executed it on behalf of said corporation,
and acknowledged to me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
/s/ Xxxxxx X. Xxxxxx
--------------------
Notary Public
Xxxxxx X. Xxxxxx
Commission # [______]
Notary Public - California
Los Angeles County
My Comm. Expires [_____________].
21
STATE OF California)
) ss.:
COUNTY OF Los Angeles)
On the [__] day of June 2002 before me, [___________] of Countrywide
Home Loans, Inc., personally appeared, personally known to me (or proved to me
on the basis of satisfactory evidence) to be the person whose name is
subscribed to the within instrument and acknowledged to me that he executed
the same in his authorized capacity, and that by his signature on the
instrument the person, or the entity upon behalf of which the person acted,
executed the instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
/s/ Xxxxxx X. Xxxxxx
--------------------
Notary Public
Xxxxxx X. Xxxxxx
Commission # [______]
Notary Public - California
Los Angeles County
My Comm. Expires [_____________].
22
ANNEX 1
ADOPTION ANNEX
The purchase price for the Initial Mortgage Loans pursuant to Section
2.03(a) is the transfer to the Seller on the Closing Date of the Notes and the
Transferor Certificates.
The items referred to in the representations and warranties in Section
3.02 are:
(xi) None of the Initial Mortgage Loans (by Initial Cut-off Date Loan
Balance) were 30-59 days delinquent (measured on a contractual basis except
that Mortgage Loans with an aggregate Stated Principal Balance not exceeding
$5,000,000 as of the Initial Cut-off Date may be between 30 and 59 days
delinquent as of the Initial Cut-off Date).
(xvi) As of the Initial Cut-off Date, no more than 1.50% of the Initial
Mortgage Loans, by aggregate principal balance, are secured by Mortgaged
Properties located in one United States postal zip code.
(xvii) The Combined Loan-to-Value Ratio for each Initial Mortgage
Loan was not in excess of 100%.
(xxv) The weighted average remaining term to maturity of the Initial
Mortgage Loans on a contractual basis as of the Initial Cut-off Date is
approximately 302 months. The Loan Rate Caps for the Initial Mortgage Loans
range between 6.00% and 21.00% and the weighted average Loan Rate Cap is
approximately 17.00%. The Gross Margins for the Initial Mortgage Loans range
between - 1.750% and 8.875% and the weighted average Gross Margin is
approximately 1.872% as of the Cut-off Date for the Initial Mortgage Loans.
The Loan Rates on the Initial Mortgage Loans range between 3.250% and 11.125%
and the weighted average Loan Rate on the Initial Mortgage Loans is
approximately 3.750%.
(xxvii) No more than 24.16% (by Initial Cut-off Date Loan Balance)
of the Initial Mortgage Loans are secured by real property improved by
individual condominium units, units in planned unit developments, townhouses
or two-to-four family residences erected on them, and at least 75.84% (by
Cut-off Date Loan Balance) of the Initial Mortgage Loans are secured by real
property with a detached one-family residence erected on them.
(xxviii) The Credit Limits on the Initial Mortgage Loans range
between approximately $4,000 and $1,500,000 with an average of approximately
$41,422. As of the Initial Cut-off Date, no Initial Mortgage Loan had a
principal balance in excess of approximately $1,500,000 and the average
principal balance of the Initial Mortgage Loans is equal to approximately
$30,911.
(xix) Approximately 7.15% and 92.85% of the Initial Mortgage Loans, by
aggregate principal balance as of the Initial Cut-off Date, are first and
second liens, respectively.
(xxx) As of the Closing Date, no more than 2.00% of the Mortgage Loans,
by aggregate principal balance, were appraised electronically.
Xxx-1-1
