EXHIBIT 99.3
EXECUTION
RECONSTITUTED SERVICING AGREEMENT
THIS RECONSTITUTED SERVICING AGREEMENT (this "Agreement"), entered into
as of the 1st day of July, 2001, by and between XXXXXX CAPITAL, A DIVISION OF
XXXXXX BROTHERS HOLDINGS INC., a Delaware corporation ("Xxxxxx Capital" or the
"Seller"), and OCWEN FEDERAL BANK FSB, a federal savings bank (the "Servicer"),
recites and provides as follows:
RECITALS
WHEREAS, the Seller has conveyed certain Mortgage Loans as identified
on Schedule I hereto (the "Serviced Mortgage Loans") to Structured Asset
Securities Corporation, a Delaware special purpose corporation ("SASCO"), which
in turn has conveyed the Serviced Mortgage Loans to Bank One, National
Association, a national banking association, as trustee (the "Trustee"),
pursuant to a trust agreement dated as of July 1, 2001 (the "Trust Agreement"),
among the Trustee, Xxxxx Fargo Bank Minnesota, National Association, as master
servicer ("WFBM" and, together with any successor Master Servicer appointed
pursuant to the provisions of the Trust Agreement, the "Master Servicer"),
SASCO, as depositor, and The Murrayhill Company, as loss mitigation advisor (the
"Loss Mitigation Advisor") under a Loss Mitigation Advisory Agreement dated as
of July 1, 2001 between the Loss Mitigation Advisor and the Servicer (the "Loss
Mitigation Advisory Agreement").
WHEREAS, multiple classes of certificates (the "Certificates") will be
issued on the Closing Date pursuant to the Trust Agreement, including Class D,
the Class P Certificate and the Class X Certificate, and Xxxxxx Brothers Inc. or
a nominee thereof is expected to be the initial registered holder of the Class
D, Class P and Class X Certificates.
WHEREAS, subsequent to the Closing Date, Xxxxxx Brothers Inc. intends
to convey all of its rights, title and interest in and to the Class D, Class P
and Class X Certificates and the payments and all other proceeds received
thereunder to an owner trust in which it will hold the sole equity interest,
which trust will issue net interest margin securities (the "NIM Securities")
through an indenture trust, which NIM Securities will be secured, in part, by
the payments on such NIM Securities (the "NIMS Transaction").
WHEREAS, one or more insurers (collectively, the "NIMS Insurer") will
each issue insurance policies guaranteeing certain payments under the NIM
Securities to be issued in the NIMS Transaction.
WHEREAS, in the event that there are two or more NIMS Insurers, it is
intended that the rights provided to the NIMS Insurer hereunder will be
allocated among two or more individual insurers that issue insurance policies in
connection with the NIMS Transaction pursuant to a NIMS Insurer Agreement among
such insurers and the parties hereto;
WHEREAS, the Serviced Mortgage Loans are currently being serviced by
the Servicer for Xxxxxx Capital pursuant to the Residential Flow Servicing and
Sale of Servicing Rights Agreement, dated August 1, 1999, between the Servicer,
AMRESCO Residential Mortgage Corporation and Finance America, LLC (the "Finance
America Agreement", which agreement was assigned to Xxxxxx Capital).
WHEREAS, Xxxxxx Capital and the Servicer desire to transfer the
servicing of the Serviced Mortgage Loans from the Finance America Agreement to
the Residential Flow Servicing Agreement, dated August 1, 1999, between the
Servicer and Xxxxxx Capital (for Performing and Non-Performing Residential
Mortgage Loans and REO Properties) (hereinafter, the "Flow Servicing Agreement")
solely for purposes of this reconstitution.
WHEREAS, Xxxxxx Capital desires that the Servicer continue to service
the Serviced Mortgage Loans, and the Servicer has agreed to do so, subject to
the rights of the Master Servicer and the Seller to terminate the rights and
obligations of the Servicer hereunder as set forth herein and to the other
conditions set forth herein.
WHEREAS, Xxxxxx Capital and the Servicer agree that the provisions of
the Flow Servicing Agreement shall apply to the Serviced Mortgage Loans, but
only to the extent provided herein and that this Agreement shall constitute a
Reconstitution Agreement (as defined in the Flow Servicing Agreement) which
shall govern the Serviced Mortgage Loans for so long as such Serviced Mortgage
Loans remain subject to the provisions of the Trust Agreement.
WHEREAS, the Master Servicer and any successor master servicer shall be
obligated, among other things, to supervise the servicing of the Serviced
Mortgage Loans on behalf of the Trustee, and shall have the right to terminate
the rights and obligations of the Servicer upon the occurrence and continuance
of a Servicer Event of Default under this Agreement.
WHEREAS, Xxxxxx Capital and the Servicer intend that each of the Master
Servicer, the NIMS Insurer and the Trustee each be an intended third party
beneficiary of this Agreement, provided that the rights extended to the NIMS
Insurer pursuant to this Agreement shall exist only so long as the NIM
Securities issued pursuant to the NIMS Transaction remain outstanding or the
NIMS Insurer is owed amounts in respect of its guaranty of payment on such NIM
Securities.
NOW, THEREFORE, in consideration of the mutual agreements hereinafter
set forth and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Xxxxxx Capital and the Servicer
hereby agree as follows:
AGREEMENT
1. Definitions. Capitalized terms used and not defined in this
Agreement, including Exhibit A hereto and any provisions of the Flow Servicing
Agreement incorporated by reference herein, shall have the meanings (regardless
if such terms are defined in the Flow Servicing Agreement, except for the term
"Collection Account") ascribed to such terms in the Trust Agreement attached as
Exhibit A hereto.
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2. Transfer. For administrative convenience, the Servicer and Xxxxxx
Capital hereby agree that the servicing of the Serviced Mortgage Loans currently
being serviced under the Finance America Agreement shall be deemed transferred
for servicing under the Flow Servicing Agreement as reconstituted by this
Agreement.
3. Servicing. The Servicer agrees, with respect to the Serviced
Mortgage Loans, to perform and observe the duties, responsibilities and
obligations that are to be performed and observed under the provisions of the
Flow Servicing Agreement, except as otherwise provided herein and on Exhibit A
hereto, and that the provisions of the Flow Servicing Agreement, as so modified,
are and shall be a part of this Agreement to the same extent as if set forth
herein in full.
4. Master Servicing; Termination of Servicer. The Servicer, including
any successor servicer hereunder, shall be subject to the supervision of the
Master Servicer, which Master Servicer shall be obligated to ensure that the
Servicer services the Serviced Mortgage Loans in accordance with the provisions
of this Agreement. The Master Servicer, acting on behalf of the Trustee and the
trust fund created pursuant to the Trust Agreement (the "Trust Fund"), shall
have the same rights as Xxxxxx Capital under the Flow Servicing Agreement to
enforce the obligations of the Servicer under the Flow Servicing Agreement and
the term "Owner" as used in the Flow Servicing Agreement in connection with any
rights of the Owner shall refer to the Master Servicer except as otherwise
specified in Exhibit A hereto. The Master Servicer, with the prior consent of
the Trustee and the NIMS Insurer, shall be entitled to terminate, and at the
direction of the NIMS Insurer shall terminate, the rights and obligations of the
Servicer under this Agreement upon the failure of the Servicer to perform any of
its obligations under this Agreement, which failure results in a Servicer Event
of Default, as provided in Article IX of the Flow Servicing Agreement.
Notwithstanding anything herein to the contrary, in no event shall the Master
Servicer be required to assume any of the obligations of Xxxxxx Capital
hereunder or under the Flow Servicing Agreement, and in connection with the
performance of the Master Servicer's duties hereunder the parties and other
signatories hereto agree that the Master Servicer shall be entitled to all of
the rights, protections and limitations of liability afforded to the Master
Servicer under the Trust Agreement.
5. No Representations. Neither the Servicer nor the Master Servicer
shall be obligated or required to make any representations and warranties
regarding the characteristics of the Serviced Mortgage Loans in connection with
the transactions contemplated by the Trust Agreement and issuance of the
Certificates issued pursuant thereto.
6. Notices. All notices, consents, certificates or reports
(collectively "written information") required to be delivered hereunder between
or among the parties hereto (including any third party beneficiary thereof)
shall be in writing, may be in the form of facsimile or electronic transmission,
and shall be deemed received or given when mailed first-class mail, postage
prepaid, addressed to each other party at its address specified below or, if
sent by facsimile or electronic mail, when facsimile or electronic confirmation
of receipt by the recipient is received by the sender of such notice. Each party
may designate to the other parties in writing, from time to time, other
addresses to which notices and communications hereunder shall be sent.
All written information required to be delivered to the Master Servicer
under this Agreement shall be delivered to the Master Servicer at the following
address:
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Xxxxx Fargo Bank Minnesota,
National Association
00000 Xxxxxx Xxxx Xxxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Master Servicing
Department ARC 2001-BC5
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
All remittances required to be made to the Master Servicer under this
Agreement shall be made on a scheduled/scheduled basis to the following wire
account:
Xxxxx Fargo Bank Minnesota
National Association
Minneapolis, Minnesota
ABA#: 000-000-000
Account Name: Corporate Trust Clearing
Account Number: 0000000000
For further credit to: Collection Account No. 0000000
(ARC 2001-BC5)
All written information required to be delivered to the Trustee
hereunder shall be delivered to the Trustee at the following address:
Bank One, National Association
1 Bank Xxx Xxxxx
Xxxx Xxxxx XX0-0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Global Corporate Trust Services
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
All written information required to be delivered to Xxxxxx Capital
hereunder shall be delivered to Xxxxxx Capital at the following address:
Xxxxxx Capital, a Division of Xxxxxx
Brothers Holdings Inc.
Three World Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Manager, Contract Finance (ARC 2001-BC5)
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
All written information required to be delivered to the Servicer shall
be delivered to the Servicer at the following address:
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Ocwen Federal Bank FSB
The Forum, Suite 1002
1675 Palm Beach Xxxxx Xxxxxxxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
Attention: Secretary
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
All written information required to be delivered to the NIMS Insurer
shall be delivered to the NIMS Insurer at the following address:
Radian Insurance Inc.
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: General Counsel
7. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, NOTWITHSTANDING NEW YORK OR
OTHER CHOICE OF LAW RULES TO THE CONTRARY.
8. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
but all of which counterparts shall together constitute but one and the same
instrument.
9. Reconstitution. Xxxxxx Capital and the Servicer agree that this
Agreement is a "Reconstitution Agreement" and that the date hereof is the
"Reconstitution Date", each as defined in the Flow Servicing Agreement.
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Executed as of the day and year first above written.
XXXXXX CAPITAL, A DIVISION OF
XXXXXX BROTHERS HOLDINGS INC.
By: /s/ Xxxxxxx Xxxxxxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxxxxxx
Title: Authorized Signatory
OCWEN FEDERAL BANK FSB
By: /s/ Xxxxxxx Xxxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice President
Acknowledged By:
XXXXX FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION,
as Master Servicer
By: /s/ Xxx Xxxxx
-----------------------------------
Name: Xxx Xxxxx
Title: Assistant Vice President
BANK ONE, NATIONAL ASSOCIATION,
as Trustee
By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Vice President
EXHIBIT A
Modifications to the Flow Servicing Agreement
1. Unless otherwise specified herein, any provisions of the Flow Servicing
Agreement, including definitions, relating to (i) representations and
warranties of the Owner, (ii) Agency Transfers, Pass-Through Transfers,
whole loan transfers, reconstitution and securitization, (iii) the sale
and purchase of the Serviced Mortgage Loans and Setup Expenses, (iv)
Transfer Dates, (v) Non-Performing Loans, and (vi) Preliminary
Servicing Period, shall be disregarded. The exhibits to the Flow
Servicing Agreement and all references to such exhibits shall also be
disregarded.
2. For reporting purposes, a Serviced Mortgage Loan is "delinquent" when
any payment contractually due thereon has not been made by the close of
business on the due date therefor. Such Serviced Mortgage Loan is "30
days Delinquent" if such payment has not been received by the close of
business on the corresponding day of the month immediately succeeding
the month in which such payment was first due, or, if there is no such
corresponding day (e.g., as when a 30-day month follows a 31-day month
in which a payment was due on the 31st day of such month), then on the
last day of such immediately succeeding month. Similarly for "60 days
Delinquent" and the second immediately succeeding month and "90 days
Delinquent" and the third immediately succeeding month.
3. The definition of "Accepted Servicing Practices" is hereby deleted and
replaced by the following:
With respect to any Serviced Mortgage Loan, those mortgage
servicing practices of prudent mortgage lending institutions
which service mortgage loans of the same type as such Serviced
Mortgage Loan in the jurisdiction where the related Mortgaged
Property is located.
4. The definition of "Ancillary Income" in Article I is hereby amended by
adding the words "as additional compensation" to the end of the last
sentence.
5. A new definition of "Adverse REMIC Event" is hereby added to Article I
to read as follows:
"Adverse REMIC Event": As defined in Article X of the Trust
Agreement.
6. The definition of Business Day in Article I is hereby amended by adding
", Illinois, Minnesota and Maryland" immediately following the word
"New York" in the definition thereof.
7. The definition of "Collection Account" in Article I is hereby amended
by deleting the words "in trust for Xxxxxx Capital, a Division of
Xxxxxx Brothers Holdings Inc. and its successors and assigns" and
substituting the following words: "in trust for Xxxxx Fargo Bank
Minnesota, National Association, as Master Servicer for the ARC
2001-BC5 Trust."
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8. The definition of "Collection Period" in Article I is hereby amended in
its entirety to read as follows:
"Collection Period" means with respect to each Distribution
Date, the period commencing on the second day of the month
immediately preceding the month of the related Distribution
Date and ending on the first day of the month of such
Distribution Date.
9. The definition of "Current Servicer" in Article I shall be deleted in
its entirety.
10. A new definition of "Custodial Agreement" is added to Article I
immediately following the definition of "Current Servicer" to read as
follows:
"Custodial Agreement" means the custodial agreement between
Bankers Trust Company of California, N.A., as custodian, and
Bank One, National Association, as trustee, relating to the
custody of the Mortgage Files for the Serviced Mortgage Loans.
11. The definition of "Custodian" in Article I is hereby amended in its
entirety to read as follows:
"Custodian" means Bankers Trust Company of California, N.A. or
any successor custodian appointed pursuant to the Custodial
Agreement.
12. The definition of "Distribution Date" in Article I is hereby amended in
its entirety to read as follows:
"Distribution Date" means the 18th day (or if such 18th day is
not a Business Day, the first Business Day immediately
following) of any month.
13. A new definition of "Distressed Mortgage Loan" is added to Article I
immediately following the definition of "Distribution Date" to read as
follows:
"Distressed Mortgage Loan" means as of any Determination Date,
any Serviced Mortgage Loan that is delinquent in payment for a
period of 90 days or more, without giving effect to any grace
period permitted by the related Mortgage Note, or for which
the Servicer or Trustee has accepted a deed in lieu of
foreclosure.
14. The definition of "Eligible Account" in Article I is hereby amended in
its entirety to read as follows:
"Eligible Account" means a segregated account maintained by
either (i) a depository institution the accounts of which are
insured by the FDIC and the short-term debt obligations of
which (or in the case of a depository institution that is a
subsidiary of a holding company, the short-term unsecured debt
obligations of such holding company) are rated "A-1" or better
by S&P or "Prime-1" or better by Xxxxx'x (or a comparable
rating, if another rating agency is specified by the Master
Servicer by written notice to the Servicer and the NIMS
Insurer) or (ii) the corporate trust department of any bank
the debt obligations of which are rated at least AA or its
equivalent by either of S&P or Xxxxx'x.
15. The definition of "Escrow Accounts" in Article I is hereby amended by
deleting the words "for Xxxxxx Capital, a Division of Xxxxxx Brothers
Holdings Inc. and its successors and assigns, and various mortgagors"
and replacing them with the following
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words: "for Xxxxx Fargo Bank Minnesota, National Association, as
Master Servicer for the ARC 2001-BC5 Trust and various mortgagors".
16. The definition of "Fitch" in Article I is hereby amended to read as
follows:
"Fitch" means Fitch, Inc. and its successors and assigns.
17. A new definition of "MGIC", "MGIC Mortgage Guaranty Master Policy" and
"Monthly Advance" are added to Article I immediately following the
definition of "Missing Document Report" to read as follows:
"MGIC" means Mortgage Guaranty Insurance Corporation and its
successors in interest.
"MGIC Mortgage Guaranty Master Policy" means the master
primary mortgage insurance policy (No. 12-136-4-1893),
including all related assignments, supplements and
endorsements, acquired by the Seller for the Trust Fund from
MGIC for certain of those Serviced Mortgage Loans listed in
Schedule I-A hereto with loan-to-value ratios determined as of
the date of origination of greater than 60% and which Serviced
Mortgage Loans shall be specifically identified to, and
labeled for, the Servicer by certificate number, Alltel/CPI
Number, the percentage of such Serviced Mortgage Loan's
principal balance insured by MGIC and other applicable
insurance coverage information in a separate schedule to be
provided to the Servicer by the Seller within five Business
Days after the Closing Date.
"Monthly Advance" means with respect to each Distribution Date
and each Loan, an amount equal to the Monthly Payment (with
the interest portion of such Monthly Payment adjusted to the
Serviced Mortgage Loan Remittance Rate) that was due on the
Serviced Mortgage Loan, and that was delinquent at the close
of business on the first day of the month in which such
Distribution Date occurs, but only to the extent that such
amount is expected, in the reasonable judgment of the
Servicer, to be recoverable from collections or other
recoveries in respect of such Serviced Mortgage Loan. To the
extent that the Servicer determines that any such amount is
not recoverable from collections or other recoveries in
respect of such Serviced Mortgage Loan, such determination
shall be evidenced by a certificate of a Servicing Officer
delivered to the Master Servicer (and a copy of which shall be
provided by the Servicer to the NIMS Insurer) setting forth
such determination and the procedures and considerations of
the Servicer forming the basis of such determination, which
shall include a copy of any broker's price opinion and any
other information or reports obtained by the Servicer which
may support such determination.
18. The definition of "Mortgage Insurance" in Article I is hereby amended
and restated in its entirety to read as follows:
"Mortgage Insurance" means any mortgage insurance, including
the MGIC Mortgage Guaranty Master Policy or the PMICO Master
Policy, or guaranty relating to a Serviced Mortgage Loan
issued by a Mortgage Insurer.
19. The definition of "Non-Recoverable Advance" in Article I is hereby
amended by replacing the reference to "Section 2.3(b)" with "Section
2.3(c)".
20. The definition of "Opinion of Counsel" is hereby amended and restated
as follows:
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"Opinion of Counsel" A written opinion of counsel, who may be
an employee of the Servicer, that is reasonably acceptable to
the Trustee, the Master Servicer and the NIMS Insurer,
provided that any Opinion of Counsel relating to (a)
qualification of the Serviced Mortgage Loans in a REMIC or (b)
compliance with the REMIC Provisions, must be an opinion of
counsel reasonably acceptable to the Trustee, the Master
Servicer, and the NIMS Insurer, who (i) is in fact independent
of the Seller, the Servicer and any Master Servicer of the
Serviced Mortgage Loans, (ii) does not have any material
direct or indirect financial interest in the Seller, the
Servicer or any Master Servicer of the Serviced Mortgage Loans
or in an affiliate of any such entity and (iii) is not
connected with the Seller, the Servicer or any Master Servicer
of the Serviced Mortgage Loans as an officer, employee,
director or person performing similar functions.
21. A new definition of "PMICO" and PMICO Master Insurance Policy" is added
to Article I to immediately follow the definition of "Person" and to
read as follows:
"PMICO" means PMI Mortgage Insurance Co. and its successors in
interest.
"PMICO Master Policy" means the bulk primary first lien master
policy (No. 21092-0001), including all related assignments,
supplements and endorsements, acquired by the Seller for the
Trust Fund from PMICO for certain of those Serviced Mortgage
Loans listed in Schedule I-B hereto with loan-to-value ratios
determined as of the date of origination of greater than 60%
and which Serviced Mortgage Loans shall be specifically
identified to, and labeled for, the Servicer by certificate
number, Alltel/CPI Number, the percentage of such Serviced
Mortgage Loan's principal balance insured by PMICO and other
applicable insurance coverage information in a separate
schedule to be provided to the Servicer and the NIMS Insurer
by the Seller within five Business Days of the Closing Date.
22. A new definition of "Prepayment Charge" is added to Article I to
immediately precede the definition of "Prepayment Interest Shortfall
Amount" and to read as follows:
"Prepayment Charge" means with respect to any Serviced
Mortgage Loan and Distribution Date, the charges or premiums,
if any, exclusive of any servicing charges collected by the
Servicer in connection with a Mortgage Loan payoff due in
connection with a full or partial prepayment of such Serviced
Mortgage Loan during the immediately preceding Collection
Period in accordance with the terms thereof (other than any
Servicer Prepayment Charge Payment Amount).
23. The definition of "Prepayment Interest Shortfall Amount" in Article I
is hereby amended by inserting the words (i) "voluntary (not including
discounted payoffs)" between the words "a" and "principal" in the
second line thereof, (ii) "or in part" between the words "full" and
"during" in the second line thereof and (iii) "for Prepayments in full
only" at the end of the parenthetical.
24. A new definition of "Prime Rate" is added to Article I immediately
following the definition of "Prepayment Interest Shortfall Amount" to
read as follows:
"Prime Rate" means the prime rate published from time to time,
as published as the average rate in The Wall Street Journal
Northeast Edition.
25. A new definition of "Purchase Price" is added to Article I immediately
following the definition of "Property Protection Expenses" to read as
follows:
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"Purchase Price". With respect to any Mortgage Loan or REO
Property to be purchased by the NIMS Insurer pursuant to
Section 6.10, an amount equal to the sum of (i) 100% of the
principal balance thereof as of the date of purchase, (ii)
accrued interest on such principal balance at the applicable
mortgage interest rate in effect from time to time to the due
date as to which interest was last covered by a payment by the
Obligor or a Monthly Advance by the Servicer or Master
Servicer and (iii) any unreimbursed Servicing Advances,
Monthly Advances and any unpaid Servicing Fees allocable to
such Distressed Mortgage Loan.
26. The definition of "Property Protection Expenses" in Article I is hereby
amended by adding the word "reasonable" at the beginning of clauses (h)
and (i).
27. The definition of "REO Property" in Article I is hereby amended by
replacing the word "Owner" with "the Trustee on behalf of the Trust
Fund".
28. The definition of "Servicing Advances" in Article I is hereby amended
in its entirety to read as follows:
"Servicing Advances" means all customary, reasonable and
necessary "out-of-pocket" costs and expenses (including
reasonable attorneys' fees and disbursements) incurred by the
Servicer in the performance by the Servicer of its servicing
obligations hereunder, including, but not limited to, (a)
Property Protection Expenses, Escrow Payments, and Property
Improvement Expenses, and (b) any enforcement or
administrative or judicial proceedings, including
foreclosures.
29. The definition of "Servicing Fee" in Article I is hereby amended in its
entirety to read as follows:
"Servicing Fee" means an amount equal to one-twelfth the
product of (a) a rate per annum equal to 0.50% and (b) the
outstanding principal balance of the Serviced Mortgage Loan.
The Servicing Fee is payable solely from the interest portion
(including recoveries with respect to interest from
Liquidation Proceeds) of such Monthly Payment collected by the
Servicer or as otherwise provided under this Agreement. In the
event servicing is transferred to a successor servicer,
clause (a) of the Servicing Fee may not exceed 0.50% per
annum.
30. The definition of "Servicing File" in Article I is hereby replaced with
the following:
"Servicing File" means with respect to each Loan, the file
retained by the Servicer.
31. The parties hereto acknowledge that Section 2.1 (Transfer of Servicing
Files to Servicer) of the Flow Servicing Agreement shall be
inapplicable to this Agreement.
32. A new definition of "Servicer Prepayment Charge Payment Amount" is
added to Article I immediately after the definition of "Servicing File"
to read as follows:
"Servicer Prepayment Charge Payment Amount" means any amounts
paid by the Servicer as a result of an impermissible waiver of
a Prepayment Charge pursuant to Section 40 of this Agreement.
33. The parties hereto acknowledge that the provisions of Section 2.2
(Release of Loan Documents) are superceded by the provisions of the
Custodial Agreement.
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34. Section 2.3(a) is hereby amended by replacing the word "Owner" in the
first, second and eighteenth lines thereof with the words "Trustee and
the Trust Fund"; by adding "if the accounts of the Servicer are FDIC
insured" after the first use of the word "Servicer" in the seventh line
thereof; and by inserting the following words at the end of clause
(b)(i) of such section: "and amounts paid by the Servicer or any other
person in respect thereof shall be deposited in the Collection Account
on the Distribution Date immediately following the Prepayment Period in
which such payoffs, installments, Prepayment Charges (or any amounts
paid by the Servicer or any person in respect thereof) were received or
incurred."
35. The second paragraph of Section 2.3(f) is hereby amended and restated
in its entirety to read as follows:
"Subject to the preceding paragraph, Servicer shall keep in
force during the term of this Agreement a fidelity bond and a policy or
policies of insurance covering errors and omissions in the performance
of Servicer's obligations under this Agreement. Such fidelity bond and
policy or policies shall be maintained with recognized insurers and
shall be in such form and amount as would permit Servicer to be
qualified as a FNMA or FHLMC seller servicer and shall by its terms not
be cancelable without thirty days' prior written notice to the Trustee,
the Master Servicer and the NIMS Insurer. The Servicer shall be deemed
to have complied with this provision if an affiliate of the Servicer
has such errors and omissions and fidelity bond coverage and, by the
terms of such insurance policy or fidelity bond, the coverage afforded
thereunder extends to the Servicer. On an annual basis, the Servicer
shall furnish to the Trustee, the Master Servicer and the NIMS Insurer
a copy of each such bond and insurance policy (or, in lieu thereof, a
certificate of fidelity bond coverage) if such entity so requests."
36. Section 2.3(b) is hereby amended by (i) adding the words ", Mortgage
Insurance policies" immediately after the words "Flood Insurance
policies" in clause (iv) thereof and (ii) by deleting the word "and" at
the end of clause (iv), deleting the period at the end of clause (v)
and replacing it with a semi-colon followed by the word "and", and by
adding a new clause (vi) to read as follows:
(vi) any Prepayment Interest Shortfall Amount.
37. Section 2.3(e) is hereby amended by replacing the reference to "Owner"
in the third line thereof with "Trustee and Trust Fund".
38. Section 2.3(i) is hereby amended by adding ", the Trustee" after the
word "Obligor" in the second line thereof.
39. Section 2.5 (Servicing Compensation) is hereby amended by deleting the
first two sentences thereof and by replacing the final sentence with
the following:
In the event that the Servicer deposits into the Collection
Account any Ancillary Income, the Servicer may withdraw such
amount pursuant to Section 6.2(c).
40. Section 3.1 (Default Management Responsibilities) is hereby amended by
(a) replacing the references to "Owner" with "Trustee and Trust Fund"
in each instance, and by adding as the last sentence thereof the
following:
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"Notwithstanding anything to the contrary in this
Agreement, the Servicer shall not, (except in the case where a
default by the related Mortgagor has occurred or is, in the
reasonable judgment of the Servicer, imminent), knowingly
permit any modification, waiver or amendment of any material
term of any Serviced Mortgage Loan (including but not limited
to the interest rate, the principal balance, the amortization
schedule, or any other term affecting the amount or timing of
payments on the Serviced Mortgage Loan or the collateral
therefor) unless the Servicer shall have provided to the
Master Servicer, the NIMS Insurer and the Trustee an Opinion
of Counsel in writing to the effect that such modification,
waiver or amendment would not cause an Adverse REMIC Event.
The cost of such Opinion of Counsel shall be reimbursable
pursuant to Section 6.2(d)." The Servicer shall notify the
Loss Mitigation Advisor of any modification made to a Serviced
Mortgage Loan if the result of such modification is to
increase the current loan-to-value ratio in excess of 100%."
and (b) adding the following paragraph as the second paragraph thereof:
The Servicer or any designee of the Servicer shall not waive
any Prepayment Charge or fee with respect to any Serviced
Mortgage Loan which contains a Prepayment Charge and which
prepays during the term of the penalty. If the Servicer or its
designee fails to collect the Prepayment Charge upon any
prepayment of any Serviced Mortgage Loan which contains a
Prepayment Charge, the Servicer shall pay to the Trust Fund at
such time by means of a deposit into the Collection Account an
amount equal to the Prepayment Charge which was not collected;
provided, however, the Servicer shall not have any obligation
to pay the amount of any uncollected Prepayment Charge under
this Section 3.1 if the failure to collect such amount is the
result of inaccurate or incomplete information on the
Prepayment Charge Schedule provided by Xxxxxx Capital and
which is included as part of the Schedule of Serviced Mortgage
Loans at Schedule 1-A and Schedule 1-B attached hereto.
Notwithstanding the above, the Servicer or its designee may
waive a Prepayment Charge without remitting the amount of the
foregone Prepayment Charge to the Collection Account if (i)
such waiver relates to a prepayment which is not a result of a
refinancing by the Servicer or any of its affiliates and (ii)
the Serviced Mortgage Loan is in default or foreseeable
default and such waiver (a) is standard and customary in
servicing similar mortgage loans to the Serviced Mortgage
Loans and (b) would, in the reasonable judgment of the
Servicer, maximize recovery of total proceeds taking into
account the value of such Prepayment Charge and the related
Serviced Mortgage Loan or (iii) the collection of the
Prepayment Charge would be in violation of applicable laws.
41. Section 3.2 (Foreclosure) is hereby amended by (i) replacing the first
sentence thereof with the following:
In the event that any payment due under any Serviced
Mortgage Loan remains delinquent for a period of 65 days or
any other default continues for a period of 65 days beyond the
expiration of any grace or cure period, the Servicer shall
commence foreclosure proceedings and provide notice thereof to
the Master Servicer, the NIMS Insurer and the Trustee in
writing. The Servicer shall retain an attorney and supervise
the conduct of the foreclosure proceeding.
; (ii) by replacing the word "Owner" in the sixth line thereof
with "the Trust Fund"; and (iii) by amending and restating the third
sentence thereof to read as follows:
Notwithstanding anything to the contrary contained
herein, in the event Servicer has reasonable cause to believe
that a Property is an Environmental Problem Property, Servicer
shall notify the Master Servicer and the NIMS Insurer of the
existence of the Environmental Problem Property, discuss such
problem, make a recommendation to the
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Master Servicer and the NIMS Insurer regarding the handling of
the property and carry out the recommendation unless otherwise
directed by the NIMS Insurer in writing within 30 days after
the Master Servicer's and NIMS Insurer's receipt thereof (or
deemed receipt) of such notice in accordance with this
Agreement. In the event of a conflict between the instructions
of the Master Servicer and the NIMS Insurer, the instructions
of the NIMS Insurer will override.
42. Section 3.3 (Deed in Lieu) is hereby amended by replacing the word
"Owner" in the fourth and seventh lines thereof with "Trustee and Trust
Fund", and by amending and restating the fourth sentence thereof in its
entirety to read as follows:
Nothwithstanding anything to the contrary mentioned
herein, in connection with a deed in lieu of foreclosure, in
the event the Servicer has reasonable cause to believe that a
Property is an Environmental Problem Property as described in
Section 4.2 hereof, the Servicer shall notify the Master
Servicer and the NIMS Insurer of the existence of the
Environmental Problem Property, describe such Problem
Property, make a recommendation to the Master Servicer and the
NIMS Insurer regarding the handing of the Property and carry
out the recommendations unless otherwise directed by the NIMS
Insurer in writing within 35 days after the Master Servicer's
and NIMS Insurer's receipt thereof (or deemed receipt) of such
notice in accordance with this Agreement. In the event of a
conflict between the instructions of the Master Servicer and
the NIMS Insurer, the instructions of the NIMS Insurer shall
override.
43. Section 3.4 (Priority; Insurance Claims) is hereby amended by replacing
the word "Owner" with "Trust Fund".
44. Section 3.5 (Bankruptcy of Obligor) is hereby amended by replacing the
word "Owner" with "Trust Fund".
45. Section 3.6 (Discounted Payoffs) is hereby amended by replacing the
word "Owner" with "Master Servicer and NIMS Insurer" in the first
sentence and with "Master Servicer or NIMS Insurer" in the second
sentence.
46. Section 4.1 (Property Management and Disposition Services) is hereby
amended by adding the following paragraphs after the first paragraph
thereto:
In the event that the Trust Fund acquires any REO
Property in connection with a default or imminent default on a
Serviced Mortgage Loan, the Servicer shall dispose of such REO
Property not later than the end of the third taxable year
after the year of its acquisition by the Trust Fund unless the
Servicer has applied for and received a grant of extension
from the Internal Revenue Service to the effect that, under
the REMIC Provisions and any relevant proposed legislation and
under applicable state law, the applicable Trust REMIC may
hold REO Property for a longer period without adversely
affecting the REMIC status of such REMIC or causing the
imposition of a federal or state tax upon such REMIC and has
notified the NIMS Insurer of such extension being granted by
providing a copy of the application and the grant of such
extension to the NIMS Insurer. If the Servicer has received
such an extension, then the Servicer shall continue to attempt
to sell the REO Property for its fair market value for such
period longer than three years as such extension permits (the
"Extended Period"). If the Servicer has not received such an
extension and the Servicer is unable to sell the REO Property
within the period ending 3 months before the end of such third
taxable year after its acquisition by the Trust Fund or if the
Servicer has received such an extension, and the Servicer is
unable to sell the REO Property within the period ending three
months before the close of
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the Extended Period, the Servicer shall, before the end of the
three year period or the Extended Period, as applicable, (i)
purchase such REO Property at a price equal to the REO
Property's fair market value as acceptable by the NIMS Insurer
or (ii) auction the REO Property to the highest bidder (which
may be the Servicer) in an auction reasonably designed to
produce a fair price prior to the expiration of the three-year
period or the Extended Period, as the case may be. The Trustee
shall sign any document or take any other action reasonably
requested by the Servicer which would enable the Servicer, on
behalf of the Trust Fund, to request such grant of extension.
Notwithstanding any other provisions of this
Agreement, no REO Property acquired by the Trust Fund shall be
rented (or allowed to continue to be rented) or otherwise used
by or on behalf of the Trust Fund in such a manner or pursuant
to any terms that would: (i) cause such REO Property to fail
to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code; or (ii) subject any Trust
REMIC to the imposition of any federal income taxes on the
income earned from such REO Property, including any taxes
imposed by reason of Sections 860F or 860G(c) of the Code,
unless the Servicer has agreed to indemnify and hold harmless
the Trust Fund and the NIMS Insurer with respect to the
imposition of any such taxes.
47. Section 4.2 is hereby amended in its entirety to read as follows:
Environmental Problems. If Servicer hereafter becomes
aware that a Property is an Environmental Problem Property,
Servicer will notify Master Servicer and the NIMS Insurer of
the existence of the Environmental Problem Property.
Additionally, Servicer shall set forth in such notice a
description of such problem, a recommendation to Master
Servicer and the NIMS Insurer relating to the proposed action
regarding the Environmental Problem Property, and Servicer
shall carry out the recommendation set forth in such notice
unless otherwise directed by the NIMS Insurer in writing
within five (5) days after each of their respective receipt
(or deemed receipt) of such notice in accordance with the
terms and provisions of Section 11.3 below. In the event of a
conflict between the instructions of the Master Servicer and
the NIMS Insurer, the instructions of the NIMS Insurer shall
override. Notwithstanding the foregoing, Servicer shall obtain
the Master Servicer's and the NIMS Insurer's written consent
to any expenditures proposed to remediate Environmental
Problem Properties or to defend any claims associated with
Environmental Problem Properties if such expenses, in the
aggregate, are expected to exceed $100,000. Failure to provide
written notice of disapproval of the expenditure within five
(5) days of receipt (or deemed receipt) of such request for
prepaid expenditures shall be deemed an approval of such
expenditure. In the event of a conflict between the
instructions of the Master Servicer and the NIMS Insurer, the
instructions of the NIMS Insurer shall override. If the
Servicer has received reliable instructions to the effect that
a Property is an Environmental Problem Property (e.g.,
Servicer obtains a broker's price opinion which reveals the
potential for such problem), Servicer will not accept a
deed-in-lieu of foreclosure upon any such Property without
first obtaining a preliminary environmental investigation for
the Property satisfactory to the Master Servicer and the NIMS
Insurer.
48. Section 5.1 (Standards of Care and Delegations of Duties) is hereby
amended by adding the following provision at the end of the penultimate
sentence of clause (b):
"; provided that the NIMS Insurer shall have
consented to such sub-servicing arrangement or termination
thereof and that the entering or termination of such
sub-servicing agreement would not result in a withdrawal or
downgrading by any Rating Agency of the rating on any Class of
Certificates or the NIM Securities to be issued in the NIMS
Transaction."
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49. Section 5.3 (Access to Records) is hereby amended and restated in its
entirety to read as follows:
If either the Master Servicer, the Trustee or the
NIMS Insurer provide reasonable prior written notice, any such
party and its respective accountants, attorneys, or designees
may examine the Servicing Files relating to the Serviced
Mortgage Loans and the REO Properties during normal business
hours of Servicer at the Trust Fund's expense. Such records
shall not include any proprietary or confidential information
as reasonably determined by the Servicer. The examining party
or parties shall provide to the Servicer a copy of any report
generated in connection with any such examination. In
addition, the Servicer shall provide to the Master Servicer,
the Trustee and the NIMS Insurer any other information,
related to the Serviced Mortgage Loans and the Properties,
reasonably requested by such parties.
50. Section 5.4 (Annual Audit) is hereby amended by changing the reference
to "April 30, 2000" in the second line thereof to "April 30, 2002" and
by changing the reference to "Owner" in the fourth line thereof to "the
Master Servicer and the NIMS Insurer".
51. A new Section 5.5 is added to the Flow Servicing Agreement to read as
follows:
Section 5.5 Annual Officer's Certificate.
On or before April 30 of each year, beginning with
April 30, 2002, the Servicer, at its own expense, will deliver
to the Master Servicer, the NIMS Insurer and the Depositor a
Servicing Officer's certificate stating, as to each signer
thereof, that (i) a review of the activities of the Servicer
during such preceding fiscal year and of performance under
this Agreement has been made under such officers' supervision,
and (ii) to the best of such officers' knowledge, based on
such review, the Servicer has fulfilled all its obligations
under this Agreement for such year, or, if there has been a
default in the fulfillment of all such obligations, specifying
each such default known to such officers and the nature and
status thereof including the steps being taken by the Servicer
to remedy such default.
52. Section 6.2 (Remittances and Monthly Report) is hereby amended as
follows:
(1) the first sentence shall be deleted in its entirety;
(2) replacing the words "in the following priority" in
the second sentence of the first paragraph with "as
follows";
(3) paragraph (b) shall be deleted in its entirety and
replaced with the following new paragraph (b):
(b) to make payments to the Master Servicer in the
amounts and in the manner provided by Section 6.6.
(4) by replacing the words "then Servicer may seek
reimbursement from Owner (as set forth in Section 6.4
below), it being understood that, in the case of such
reimbursement from the Collection Account, Servicer's
right thereto shall be prior to the rights of Owner" in
paragraph (d) with "then the Servicer may reimburse
itself from amounts on deposit in the Collection
Account, it being understood that the Servicer's right
to such amounts from the Collection Account shall be
prior to the rights of the Trust Fund."
(5) new paragraphs (e) and (f) after paragraph (d) shall be
added to read as follows:
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(e) to reimburse the Servicer for Monthly Advances of
the Servicer's funds made pursuant to Section 6.8.
The Servicer's right to reimburse itself pursuant
to this subclause (e) with respect to any Serviced
Mortgage Loan shall be limited to amounts received
on the related Serviced Mortgage Loan which
represent late payments of principal and/or
interest respecting which any such advance was
made, it being understood that, in the case of any
such reimbursement, the Servicer's right to such
reimbursement shall be prior to the rights of the
Trust Fund; provided, however, that in the event
that the Servicer determines in good faith that any
unreimbursed Monthly Advances will not be
recoverable from amounts representing late
recoveries of payments of principal or interest
respecting the particular Serviced Mortgage Loan as
to which such Monthly Advance was made or from
Liquidation Proceeds or Insurance Proceeds with
respect to such Serviced Mortgage Loan, the
Servicer may reimburse itself for such amounts from
the Collection Account, it being understood, in the
case of any such reimbursement, that the Servicer's
right thereto shall be prior to the rights of the
Trust Fund;
(f) to reimburse the Servicer for any amounts owed
pursuant to Section 8.3(a).
(6) and by deleting the last paragraph.
53. Section 6.3 (Remittance Upon Termination) is hereby amended by
restating paragraph (b) and paragraph (c) of such Section as follows:
(b) to make payments to the Master Servicer in the
amounts and in the manner provided by Section 6.6;
and
(c) to reimburse itself for all unpaid Servicing Fees,
Monthly Advances and Servicing Advances, it being
understood that the Servicer's rights to such
reimbursement shall be prior to the rights of the
Trust Fund.
54. The parties hereto acknowledge that Section 6.4 (Billing) shall be
inapplicable to this Reconstitution Agreement.
55. The parties hereto acknowledge that Section 6.5 (Missing Document
Report) shall be superseded by the provisions of the Custodial
Agreement.
56. New Sections 6.6, 6.7, 6.8, 6.9, 6.10 and 6.11 are hereby added to the
Flow Servicing Agreement to read as follows:
Section 6.6. Remittances.
On each Distribution Date the Servicer shall remit on
a scheduled/scheduled basis by wire transfer of immediately
available funds to the Master Servicer (a) all amounts
deposited in the Collection Account as of the close of
business on the last day of the related Collection Period (net
of charges against or withdrawals from the Collection Account
pursuant to Section 6.2) (other than payments of principal due
on or before August 1, 2001), plus (b) all Monthly Advances,
if any, which the Servicer is obligated to make pursuant to
Section 6.8, minus (c) any amounts attributable to Principal
Prepayments, Liquidation Proceeds, insurance proceeds,
condemnation proceeds or REO Property disposition proceeds
received after the applicable Collection Period, which amounts
shall be remitted on the following Distribution Date, plus (d)
any additional
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interest required to be deposited in the Collection Account in
connection with a Prepayment Interest Shortfall Amount in
accordance with Section 2.3(b)(vi), and minus (e) any amounts
attributable to Monthly Payments collected but due on a due
date or dates subsequent to the first day of the month in
which such Distribution Date occurs, which amounts shall be
remitted on the Distribution Date or Dates next succeeding the
Collection Period for such amounts.
With respect to any remittance received by the Master
Servicer after the Business Day on which such payment was due,
the Servicer shall pay to the Master Servicer interest on any
such late payment at an annual rate equal to the Prime Rate,
adjusted as of the date of each change, plus three percentage
points, but in no event greater than the maximum amount
permitted by applicable law. Such interest shall be deposited
in the Collection Account by the Servicer on the date such
late payment is made and shall cover the period commencing
with the day following the Distribution Date 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 Distribution 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 6.7 Statements to Master Servicer.
Not later than the 13th calendar day in the case of
the first Distribution Date and, thereafter, no later than the
tenth calendar day, (or if such tenth calendar day is not a
Business Day, the immediately preceding Business Day) of each
month, the Servicer shall furnish to the Master Servicer and
the NIMS Insurer (a) a monthly remittance advice containing
such information and in a format mutually agreed between the
Servicer and the Master Servicer (and acceptable to the NIMS
Insurer) as to the accompanying remittance and the period
ending on the preceding Determination Date and (b) all such
information required pursuant to clause (a) above on a
magnetic tape or other similar media reasonably acceptable to
the Master Servicer and the NIMS Insurer.
Such monthly remittance advice shall also be
accompanied with a supplemental report provided to the Master
Servicer, the NIMS Insurer and the Seller which includes on an
aggregate basis for the previous Due Period (i) the amount of
claims filed, (ii) the amount of any claim payments made,
(iii) the amount of claims denied or curtailed and (iv)
policies cancelled with respect to those Serviced Mortgage
Loans covered by either (i) the MGIC Mortgage Guaranty Master
Policy or (ii) the PMICO Master Insurance Policy
(collectively, the "PMI Policies") or any other provider of
primary mortgage insurance purchased by the Trust. The Master
Servicer will convert such data into a format acceptable to
the Trustee and the NIMS Insurer and provide monthly reports
to the Trustee and the NIMS Insurer pursuant to the Trust
Agreement; provided, however, notwithstanding anything to the
contrary contained in either of such master primary mortgage
insurance policies, the Servicer shall not be required to
submit any supplemental reports including the foregoing data
with respect to such policies until a reporting date that is
at least 15 days after the Servicer has received sufficient
loan level detail information from the Depositor to
appropriately code its servicing system in accordance with
either policy's requirements.
The Servicer shall provide the Master Servicer and
the NIMS Insurer with such information available to it
concerning the Serviced Mortgage Loans as is necessary for the
Master Servicer to prepare the Trust Fund's federal income tax
return as the Master Servicer may reasonably request from time
to time.
Section 6.8 Monthly Advances by Servicer.
On the Business Day immediately preceding each
Distribution Date, the Servicer
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shall deposit in the Collection Account from its own funds or
from amounts held for future distribution an amount equal to
all Monthly Payments which were due on the Serviced Mortgage
Loans during the applicable Collection Period and which were
delinquent at the close of business on the immediately
preceding Determination Date. Any amounts held for future
distribution and so used shall be replaced by the Servicer by
deposit in the Collection Account on or before any future
Distribution Date if funds in the Collection Account on such
Distribution Date shall be less than remittances to the Master
Servicer required to be made on such Distribution Date. In no
event shall the preceding sentence be construed as limiting
the Servicer's right to (i) pass through late collections on
the related Serviced Mortgage Loans in lieu of making Monthly
Advances or (ii) reimburse itself for such Monthly Advances
from late collections on the related Serviced Mortgage Loans.
The Servicer shall make Monthly Advances through the
Distribution Date immediately preceding the distribution of
all Liquidation Proceeds and other payments or recoveries
(including insurance proceeds and condemnation proceeds) with
respect to the related Serviced Mortgage Loans.
Section 6.9 Compensating Interest.
The Servicer shall deposit in the Collection Account
on a daily basis, and retain therein with respect to each
Principal Prepayment, the Prepayment Interest Shortfall
Amount, if any, for the month of such distribution. Such
deposit shall be made from the Servicer's own funds, without
reimbursement therefor up to a maximum amount per month of the
Servicing Fee actually received for such month for the
Serviced Mortgage Loans.
Section 6.10 Purchase of Distressed Mortgage Loans.
The NIMS Insurer may, at its option, purchase a
Distressed Mortgage Loan; provided, however, prior to any such
purchase, the Servicer shall be required to continue to make
Monthly Advances with respect to such Distressed Mortgage
Loans pursuant to Section 6.8 unless it has deemed such
Monthly Advances non-recoverable. Any such purchase shall be
accomplished by remittance to the Master Servicer of the
Purchase Price for the Distressed Mortgage Loan for deposit
into the Collection Account established by the Master Servicer
pursuant to the Trust Agreement. The Trustee and the Servicer
shall immediately effectuate the conveyance of the purchased
Distressed Mortgage Loan to the NIMS Insurer exercising the
purchase option, including prompt delivery of the Servicing
File and all related documentation to the applicable NIMS
Insurer.
Section 6.11 Servicing and Administration of the PMI
Policies.
(a) The Servicer shall take all such actions on
behalf of the Trustee as are necessary to service, maintain
and administer the PMI Policies and to perform and enforce the
rights under such Policies for its own account. Except as
expressly set forth herein, the Servicer shall have full
authority on behalf of the Trust to do anything it reasonably
deems appropriate or desirable in connection with the
servicing, maintenance and administration of the PMI Policies.
The Servicer shall not take, or permit any subservicer to
modify or otherwise permit an assumption of a Serviced
Mortgage Loan covered by a PMI Policy or take any other action
with respect to such Serviced Mortgage Loan which would result
in non-coverage under the applicable PMI Policy of any loss
which, but for the actions of the Servicer or subservicer,
would have been covered thereunder. To the extent coverage is
available, the Servicer shall keep or cause to be kept in full
force and effect the PMI Policies for as long as any
Certificates are outstanding. The Servicer shall cooperate
with PMI Insurers and shall use its best efforts
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to furnish all reasonable aid, evidence and information in the
possession of the Servicer to which the Servicer has access
with respect to any Serviced Mortgage Loan; provided, however,
notwithstanding anything to the contrary contained in the PMI
Policies, the Servicer shall not be required to submit any
reports to the PMI Insurers until a reporting date that is at
least 15 days after the Servicer has received sufficient loan
level information from Xxxxxx Capital to appropriately code
its servicing system in accordance with each of the PMI
Insurer's requirements.
(b) The Servicer shall deposit into the Collection
Account pursuant to Section 6.3 hereof all Insurance Proceeds
received from the PMI Policies.
(c) Notwithstanding the provisions of (a) and (b)
above, the Servicer shall not take any action in regard to the
PMI Policies inconsistent with the rights and interests of the
Trustee, the NIMS Insurer or the Certificateholders under this
Agreement.
(d) The Trustee shall furnish the Servicer with any
powers of attorney and other documents (within fifteen (15)
days upon request from the Servicer) in form as provided to it
necessary or appropriate to enable the Servicer to service and
administer the PMI Policies; provided, however, that the
Trustee shall not be liable for the actions of the Servicer
under such powers of attorney.
57. Section 7.1(e) (Litigation) is hereby amended by adding "in any one
instance or in the aggregate," after "if adversely determined,".
58. A new paragraph is hereby added at the end of Section 7.1
(Representations and Warranties) to read as follows:
It is understood and agreed that the representations
and warranties set forth in Section 7.1 shall survive the
engagement of the Servicer to perform the servicing
responsibilities hereunder and the delivery of the Servicing
Files to the Servicer and shall inure to the benefit of the
Trustee and the Trust Fund. Upon discovery by either the
Servicer, the Master Servicer, the NIMS Insurer or the Trustee
of a breach of any of the foregoing representations and
warranties which materially and adversely affects the ability
of the Servicer to perform its duties and obligations under
this Agreement or otherwise materially and adversely affects
the value of the Serviced Mortgage Loans, the Mortgaged
Property or the priority of the security interest on such
Mortgaged Property or the interest of the Trustee or the Trust
Fund, the party discovering such breach shall give prompt
written notice to the other.
Within 60 days of the earlier of either discovery by
or notice to the Servicer of any breach of a representation or
warranty set forth in Section 7.1 which materially and
adversely affects the ability of the Servicer to perform its
duties and obligations under this Agreement or otherwise
materially and adversely affects the value of the Serviced
Mortgage Loans, the Mortgaged Property or the priority of the
security interest on such Mortgaged Property, the Servicer
shall use its best efforts promptly to cure such breach in all
material respects and, if such breach cannot be cured, the
Servicer shall, at the option of the Trustee or the NIMS
Insurer, assign the Servicer's rights and obligations under
this Agreement (or respecting the affected Loans) to a
successor Servicer selected by the Trustee with the prior
consent and approval of the Master Servicer and the NIMS
Insurer. Such assignment shall be made in accordance with
Section 10.4.
In addition, the Servicer shall indemnify (from its
own funds) the Trustee, the Trust Fund, the NIMS Insurer and
the Master Servicer and hold each of them harmless against any
costs resulting from any claim, demand, defense or assertion
based on or grounded upon, or resulting from, a breach of the
Servicer's representations and
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warranties contained in this Agreement. It is understood and
agreed that the remedies set forth in this Section 7.1
constitute the sole remedies hereunder of the Master Servicer,
the NIMS Insurer, the Trust Fund and the Trustee respecting a
breach of the foregoing representations and warranties. The
foregoing shall not limit, however, any remedies available to
the Master Servicer, the Trustee, the NIMS Insurer or the
Trust Fund available pursuant to any other agreement related
hereto or to the insurance policy pursuant to which the NIM
Securities in the NIMS Transaction are insured..
Any cause of action against the Servicer relating to
or arising out of the breach of any representations and
warranties made in Section 7.1 shall accrue upon (i) discovery
of such breach by the Servicer or notice thereof by the
Trustee, the NIMS Insurer or Master Servicer to the Servicer,
(ii) failure by the Servicer to cure such breach within the
applicable cure period, and (iii) demand upon the Servicer by
the Trustee, the NIMS Insurer or the Master Servicer for
compliance with this Agreement.
59. Section 8.2 (Servicer's Indemnity of Owner) is hereby amended by
changing the word "Owner" to "Master Servicer, Trustee, the Trust Fund
and the NIMS Insurer" each time it appears therein.
60. Section 8.3 (Owner's Indemnity of Servicer; Limitation on Liability of
Servicer) is hereby amended by (i) replacing Section 8.3(a) with the
following:
The Servicer and any director or officer or employee
or agent of the Servicer shall be indemnified by the Trust
Fund and held harmless against any loss, liability or expense
incurred in connection with any legal action relating to this
Agreement or the Certificates, other than any loss, liability
or expense incurred by reason of its willful misfeasance, bad
faith or negligence in the performance of duties hereunder or
by reason of its reckless disregard of obligations and duties
hereunder.
, (ii) deleting the fifth and sixth sentences of Section 8.3(d), (iii)
changing the word "Owner" in Section 8.3(b) to "Master Servicer,
Trustee, the Trust Fund or the NIMS Insurer", and (iv) by amending and
restating Section 8.3(d) in its entirety to read as follows:
It is understood and agreed that during the term of
this Agreement, the Master Servicer and the Trustee may have
access to certain Servicer's confidential and proprietary
information, [[including the Servicing Files and certain other
information relating to the Serviced Mortgage Loans which the
Servicer may grant access to in its sole and absolute
discretion the "Confidential Information".
The term "Confidential Information" does not include
information which becomes generally available to the public
other than as a result of disclosure by the Master Servicer,
the Trustee or their representatives, but shall be deemed to
include any passwords or identification codes, access codes,
modem dial-up numbers and similar items. The Master Servicer
and the Trustee shall keep confidential and shall not divulge
to any party other than an officer, employee or agent of
Master Servicer or the Trustee who has a need-to-know, without
Servicer's prior written consent, any Confidential
Information. Additionally, the Master Servicer and the Trustee
shall only permit its officers, employees or agents to perform
procedures on Servicer's system which are specifically
authorized by Servicer. The Confidential Information shall not
be used or duplicated by Master Servicer or the Trustee for
any purpose other than those purposes specified pursuant to
the Trust Agreement or this Agreement. Each of the Master
Servicer and the Trustee further agrees that the Confidential
Information will not be used by it or its directors, officers,
employees, invitees, agents or representatives, including,
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but not limited to outside counsel, in any way detrimental to
Servicer, as determined in the reasonable judgment of
Servicer, and in no event shall the Confidential Information
be used without the prior written consent of the Servicer. In
the event that Master Servicer or the Trustee are requested or
required (by oral questions, interrogatories, requests for
information or documents, subpoena, civil investigative demand
or similar process) to disclose any Confidential Information,
it is agreed that Master Servicer and the Trustee will provide
Servicer with prompt notice of such request(s) and shall fully
cooperate with the Servicer to seek an appropriate protective
order and/or waive compliance with the provisions of this
subsection, in Servicer's sole and absolute discretion. Each
of the Master Servicer and the Trustee acknowledge that
Servicer will incur irreparable damage if Master Servicer or
the Trustee or their respective directors, officers,
employees, invitees, agents or representatives breaches or
threatens to breach any of the provisions of this subsection.
Accordingly, each of the Master Servicer and the Trustee
agrees to indemnify the Servicer from, and hold it harmless
against, any loss, liability or expense arising in respect of
any breach by the Master Servicer or the Trustee of their
respective obligations under this subsection. This indemnity
obligation shall survive the termination or discharge of this
Flow Servicing Agreement, the resignation or removal of the
Servicer, and the termination of the Trust Further, if any of
the foregoing parties breaches or threatens to breach any of
the provisions of this section, then Servicer shall be
entitled, without prejudice, to all the rights and remedies
available to it, including a temporary restraining order and
an injunction restraining any breach of the provisions of this
subsection (without any bond or other security being required
therefore).
61. Section 9.1 (Events of Default) is hereby amended as follows:
(a) by substituting the words "the Master Servicer or
the NIMS Insurer" for the word "Owner" in clause (a) and
clause (b) thereof; and
(b) by substituting the words "the Master Servicer
and the NIMS Insurer" for the word "Owner" in clause (f)
thereof.
62. The parties hereto acknowledge that the remedies set forth in Section
10.1(b) may be exercised by either the Master Servicer or Trustee on
behalf of the Trust Fund and shall be exercised at the instructions of
the NIMS Insurer.
63. A new paragraph is hereby added as the final paragraph of Section
10.1(b) to read as follows:
By a written notice, the Trustee and the Master
Servicer (with the prior written consent of the NIMS Insurer)
may waive any default by the 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 under Section 9.1 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.
64. Section 10.1(b) is hereby amended by adding the words ", the NIMS
Insurer or the Trustee" after the word "Owner" in the third and twelfth
lines thereof.
65. Section 10.1(c) is hereby amended in its entirety to read as follows:
(c) The Seller may terminate the rights and
obligations of the Servicer under this Agreement without
cause. Any such termination shall be with 30 days' prior
notice,
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in writing and delivered to the Trustee, the Master Servicer,
the NIMS Insurer and the Servicer by registered mail and shall
require the written consent of the Master Servicer, the
Trustee and NIMS Insurer. The Servicer shall comply with the
termination procedures set forth in Section 10.4 hereof. The
Master Servicer or the Trustee shall have no right to
terminate the Servicer pursuant to this Section 10.1(c). In
the event of a termination pursuant to this Section 10.1(c),
the Seller shall (i) appoint a successor servicer pursuant to
Section 10.4 and (ii) pay to the Servicer a sum, as liquidated
damages, from its own funds without reimbursement, equal to
the product of (a) two, (b) the annual servicing fee rate, and
(c) the aggregate unpaid principal balance of the Serviced
Mortgage Loans for which this Agreement is going to be
terminated as of the last day of the month following receipt
of such notice of termination. In connection with any such
termination by the Seller pursuant to this Section 10.1(c),
the Seller will be responsible for reimbursing the Servicer
for all unreimbursed Servicing Advances, Servicing Fees and
Monthly Advances within fifteen days following the date of
such termination without any right of reimbursement from the
Trust Fund.
66. Section 10.1(d) is hereby deleted in its entirety.
67. Section 10.2 is hereby amended by changing the word "Owner" to "Master
Servicer, the Trustee, the Seller and the NIMS Insurer."
68. Section 10.3 (Servicer Not to Resign) is hereby amended by changing the
word "Owner" to the "Master Servicer, the Trustee and the NIMS
Insurer", except in the last sentence thereof where the word "Owner"
shall be replaced by the word "Master Servicer".
69. The following new paragraphs are hereby added to Section 10.4
immediately preceding the existing paragraph of Section 10.4, to read
as follows:
Within 90 days of the termination of the Servicer's
responsibilities and duties under this Agreement (a) pursuant
to Sections 10.1(b) or 10.3 (except 10.3(ii)), the Master
Servicer shall, in accordance with the provisions of the Trust
Agreement, (i) succeed to and assume all of the Servicer's
responsibilities, rights, duties and obligations under this
Agreement, or (ii) appoint a successor acceptable to the NIMS
Insurer (which acceptance will not be unreasonably withheld)
and otherwise meeting the eligibility requirements of this
Agreement and which shall succeed to all rights and assume all
of the responsibilities, duties and liabilities of the
Servicer under this Agreement; or (b) pursuant to Section
10.1(c), the Seller shall appoint a successor acceptable to
the NIMS Insurer (which acceptance will not be unreasonably
withheld) which shall succeed to all rights and assume all of
the responsibilities, duties and liabilities of the Servicer
under this Agreement simultaneously with the termination of
the Servicer's responsibilities, duties and liabilities under
this Agreement; provided, however, the obligation of the
Master Servicer or the successor servicer to make Monthly
Advances not made by the defaulting Servicer shall be
effective immediately upon the termination of the defaulting
Servicer. Any successor to the Servicer shall be subject to
the approval of the Master Servicer, the Seller, the NIMS
Insurer and each Rating Agency (as such term is defined in the
Trust Agreement). Each Rating Agency must deliver to the
Trustee and the NIMS Insurer a letter 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 or the NIM Securities to be issued in the
NIMS Transaction. In addition, with respect to any FHA Loans
serviced hereunder, the Servicer shall provide notice of such
change in servicers to HUD on HUD Form 92080 or such other
form as prescribed by HUD, at least 10 days after such
transfer of servicing. In connection with such appointment and
assumption, the Master Servicer or the Seller, as applicable,
may make such arrangements for the compensation of such
successor out of payments on Serviced Mortgage Loans as it and
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such successor shall agree; provided, however, that no such
compensation shall be in excess of that permitted the Servicer
under this Agreement. 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 10.4 and shall in no event
relieve the Servicer of the representations and warranties
made pursuant to Sections 7.1 and the remedies available to
the Trustee under Section 7.1, it being understood and agreed
that the provisions of such Section 7.1 shall be applicable to
the Servicer notwithstanding any such resignation or
termination of the Servicer, or the termination of this
Agreement.
Within a reasonable period of time, but in no event
longer than within 30 days of the appointment of a successor
entity, the Servicer shall prepare, execute and deliver to the
successor entity any and all documents and other instruments,
place in such successor's possession all Servicing 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. The Servicer shall cooperate with the Trustee,
the NIMS Insurer, the Master Servicer, as applicable, and such
successor in effecting the termination of the Servicer's
responsibilities and rights hereunder and the transfer of
servicing responsibilities to the successor Servicer,
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 Collection Account
or any Escrow Account or thereafter received with respect to
the Loans. In the event the Servicer is terminated pursuant to
Section 10.1(c), the Seller shall be responsible for payment
from its own funds without reimbursement of any out-of-pocket
costs incurred by the Servicer and the Master Servicer in
connection with the transfer of the Serviced Mortgage Loans to
a successor servicer.
Any successor appointed as provided herein shall
execute, acknowledge and deliver to the Trustee, the NIMS
Insurer, the Servicer and the Master Servicer an instrument
(i) accepting such appointment, wherein the successor shall
make the representations and warranties set forth in Section
7.1 and (ii) an assumption of the due and punctual performance
and observance of each covenant and condition to be performed
and observed by the Servicer under this Agreement, 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
10.1 or 10.3 shall not affect any claims that the Master
Servicer, the NIMS Insurer or the Trustee may have against the
Servicer arising out of the Servicer's actions or failure to
act prior to any such termination or resignation.
The Servicer shall deliver within three (3) Business
Days to the successor Servicer the funds in the Collection
Account and Escrow Account and all Loan Documents 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.
Upon a successor's acceptance of appointment as such,
the Servicer shall notify the Trustee, the Master Servicer and
the NIMS Insurer of such appointment in accordance with the
notice procedures set forth herein.
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Except as otherwise provided in this Agreement, all
reasonable costs and expenses incurred in connection with any
transfer of servicing hereunder as a result of termination for
cause or resignation of the Servicer, including, without
limitation, the costs and expenses of the Master Servicer or
any other Person in appointing a successor servicer, or of the
Master Servicer in assuming the responsibilities of the
Servicer hereunder, or of transferring the Servicing Files or
resigning and the other necessary data, to the successor
servicer shall be paid by the terminated Servicer from its own
funds without reimbursement.
70. The provisions of Article XI (Reconstitution) are superceded by this
Agreement.
71. Section 12.1 (Successors or Assigns: No Third Party Beneficiaries) is
hereby amended by deleting "No Third Party Beneficiaries" in the
heading of such Section and by deleting the second sentence thereof in
its entirety.
72. Section 12.2 (Choice of Law) shall be deleted in its entirety.
73. Section 12.4 (Entire Agreement; Amendments; Waivers) is hereby amended
by replacing "the party against whom such amendment is sought to be
enforced" with "the Servicer and Xxxxxx Capital, with the written
consent of the Master Servicer, the Trustee and the NIMS Insurer", and
by deleting the third sentence thereof and replacing it with "The
Master Servicer, may, with the consent of the NIMS Insurer by written
notice to the Servicer, extend the time for or waive the performance of
any of the obligations of the Servicer hereunder."
74. Section 12.5 (No Joint Venture; Limited Agency) is hereby amended by
replacing the word "Owner" with "the Trustee, the Trust Fund, the
Master Servicer, the NIMS Insurer or Xxxxxx Capital" in each instance.
75. New Sections 12.10 (Intended Third Party Beneficiaries), is added to
the Flow Servicing Agreement to read as follows:
Section 12.10 Intended Third Party Beneficiaries.
Notwithstanding any provision herein to the contrary,
the parties to this Agreement agree that it is appropriate, in
furtherance of the intent of such parties as set forth herein,
that the Master Servicer, the Trustee and the NIMS Insurer
receive the benefit of the provisions of this Agreement as
intended third party beneficiaries of this Agreement to the
extent of such provisions. The Servicer shall have the same
obligations to the Master Servicer, the Trustee and the NIMS
Insurer as if they were parties to this Agreement, and the
Master Servicer, the Trustee and the NIMS Insurer shall have
the same rights and remedies to enforce the provisions of this
Agreement as if they were parties to this Agreement. The
Servicer shall only take direction from the Master Servicer
(if direction by the Master Servicer is required under this
Agreement) unless otherwise directed by this Agreement).
Notwithstanding the foregoing, all rights and obligations of
the Master Servicer and the Trustee hereunder (other than the
right to indemnification and the indemnification obligations)
shall terminate upon termination of the Trust Fund pursuant to
the Trust Agreement and all rights of the NIMS Insurer set
forth in this Agreement (other then the right of
indemnification) shall exist only so long as the NIM
Securities issued pursuant to the NIMS Transaction remain
outstanding or the NIMS Insurer is owed amounts in respect of
its guaranty of payment of such NIM Securities.
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Exhibit B
Trust Agreement for ARC 2001-BC5
B-1
Schedule I
Schedule of Serviced Mortgage Loans
S-II-1
Schedule I-A
Schedule of Serviced Mortgage Loans
covered by the MGIC Mortgage Guaranty Master Policy
S-II-2
Schedule I-B
Schedule of Serviced Mortgage Loans
covered by the PMICO Master Insurance Policy
S-II-3
