EXHIBIT 10.8
RESIDENTIAL MORTGAGE FINANCING FACILITY
TRI-PARTY CUSTODY AGREEMENT
among Preferred Credit Corporation ("Customer"), Nikko Financial Services, Inc.,
on behalf of itself and its successors and assigns ("Nikko"), and Bankers Trust
Company of California, N.A. ("Custodian") dated June 13, 1997. This Tri-Party
Custody Agreement ("Agreement") is made and entered into as on the date written
above, among Customer, Custodian and Nikko.
PRELIMINARY STATEMENT
With respect to the mortgage loans related to this Agreement, Nikko may, from
time to time, (i) make advances or purchase assets under an agreement to resell
such purchased assets to Customer (each, an "Advance") and (ii) assign all or
part of its interests in the Advance to one or more investors. Customer has
granted or shall hereafter grant to Nikko a security interest in and lien on
certain collateral ("Collateral") as security for the performance of the
obligations of Customer in connection with Advances. Nikko has also agreed to
make Advances to Customer to allow Customer to originate, purchase or finance
mortgage loans secured by enforceable first or second lien mortgages on real
properties, which Advances may be disbursed by Customer's designated closing
agent (individually or collectively, a "Closing Agent").
Customer intends, from time to time, to deliver certain items of Collateral to
Custodian and Custodian is willing to hold such Collateral in custody as bailee
of and as agent for Nikko, in order to perfect Nikko's security interest in and
lien on such Collateral.
Certain items of Collateral constitute 1-to-4 family residential first or second
lien mortgage loans intended either to secure or underlie securities or
certificates issued or guaranteed by the Government National Mortgage
Association ("GNMA"), the Federal National Mortgage Association ("FNMA") or the
Federal Home Loan Mortgage Corporation ("FHLMC", GNMA, FNMA and FHLMC, each, an
"Agency") or to be purchased for cash by an Agency ("Agency Mortgage Loans"),
and certain items of Collateral constitute mortgage loans intended to be
purchased for cash by a purchaser listed on Schedule I hereto as amended from
time to time by Nikko ("Authorized Purchaser") or held for investment purposes
by Customer ("Nonagency Mortgage Loans"). Agency Mortgage Loans and Nonagency
Mortgage Loans are herein referred to as "Mortgage Loans".
NOW, THEREFORE, the parties to this Agreement hereby agree as follows:
1. APPOINTMENT OF CUSTODIAN. Nikko hereby appoints Custodian, and Custodian
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hereby accepts its appointment, to act as the bailee of and agent for Nikko and
its successors and assigns for the purpose of taking custody of such Collateral
and the proceeds thereof or substitutions therefor. With respect to each Agency
Mortgage Loan, Custodian's appointment as Nikko's bailee and agent shall
terminate upon (i) Custodian's receipt of notification from Nikko that a
security backed in whole or in part by such Agency Mortgage Loan has been issued
by an Agency, (ii) settlement of purchase of such Agency Mortgage Loan by an
Agency or (iii) notice from Nikko. With respect to each Nonagency Mortgage
Loan, Custodian's appointment as Nikko's bailee and agent shall terminate upon
settlement of purchase of such Nonagency Mortgage Loan by an Authorized
Purchaser, repurchase of such Nonagency Mortgage Loan by Customer or upon notice
from Nikko.
2. DEPOSIT OF COLLATERAL. Customer shall deposit with Custodian, and Custodian
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agrees to hold in pledge, as bailee of and as agent for Nikko and its successors
and assigns, such Collateral that may be so deposited hereunder from time to
time. For each item of Collateral deposited with Custodian hereunder, Customer
shall submit a collateral receipt substantially in the form attached hereto
("Collateral Receipt").
3. GNMA REQUIRED DOCUMENTS. For each Mortgage Loan intended to be included in
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a GNMA pool, Customer shall deposit with Custodian the following required
documents (the "GNMA Required Documents") and/or all such other documents as
GNMA or Nikko may require from time to time for the issuance of the related GNMA
securities, duly authorized and completed:
(a) the original note, bearing all intervening endorsements, endorsed "Pay to
the order of ________, without recourse" and signed in the name of Customer
by an Authorized Representative of Customer, unless otherwise specified by
GNMA;
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(b) an original assignment of mortgage or deed of trust (hereinafter referred
to as assignment of mortgage or assignment) from Customer with assignee in
blank, in form and substance acceptable for recording, but not recorded,
unless otherwise specified by GNMA;
(c) the original of all intervening assignments of mortgage, if any, unless
otherwise specified by GNMA;
(d) a completed Warehouse Lender's Release Letter, substantially in the form
attached hereto ("Warehouse Lender's Release Letter"), unless such Mortgage
Loans are already subject to a lien by Nikko under this Agreement;
(e) a Schedule of Subscribers and GNMA Contractual Agreement on Form HUD-11705
listing The Nikko Securities Co. International, Inc., 000 Xxxxxxx Xxxxxx,
00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, taxpayer number 00-0000000
("NSI"), as the only subscriber and as the sole person who is authorized to
take delivery of the related GNMA security;
(f) a Schedule of Pooled Mortgages on Form HUD-11706;
(g) a Release of Security Interest on Form HUD-11711A, with the signature of
the person authorized to sign for Nikko or Custodian on behalf of Nikko, in
blank;
(h) a Certification and Agreement Regarding Security Interest on Form HUD-
11711B; and
(i) a Summary of Guaranty Agreement on Form XXX-00000 (xxxxx payment), HUD-1746
(GPM or GEM) or HUD-1733 (serial notes) as appropriate.
4. FNMA REQUIRED DOCUMENTS. For each Mortgage Loan intended to be included in
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a FNMA pool, Customer shall deposit with Custodian the following required
documents (the "FNMA Required Documents"), and/or all such other documents as
FNMA or Nikko may require from time to time for the issuance of the related FNMA
securities or the purchase by FNMA of such Mortgage Loan, duly authorized and
completed:
(a) the original note, bearing all intervening endorsements, endorsed "Pay to
the order of ________, without recourse" and signed in the name of Customer
by an Authorized Representative of Customer, unless otherwise specified by
FNMA;
(b) an original assignment of mortgage or deed of trust (hereinafter referred
to as assignment of mortgage or assignment) from Customer with assignee in
blank, in form and substance acceptable for recording, but not recorded,
unless otherwise specified by FNMA;
(c) the original of all intervening assignments of mortgage, if any, unless
otherwise specified by FNMA;
(d) a completed Warehouse Lender's Release Letter, unless such mortgage loans
are already subject to a lien by Nikko under this Agreement;
(e) a Security Release Certification on Form 2004, with the signature of the
person authorized to sign for Nikko, or Custodian on behalf of Nikko, in
blank;
(f) a Schedule of Mortgages on Form 2005 (fixed rate), Form 2025 (ARMs, GEMs
and VRMs) or other appropriate form; and
(g) either a Delivery Schedule on Form 2014 listing NSI as the only subscriber
and as the sole person to which the related FNMA securities shall be
delivered or, if the Mortgage Loans are to be purchased by FNMA, either (i)
a Loan Schedule (Form 1068 or 1069) listing Nikko's payee code, or (ii) a
bailee letter for execution by the Custodian substantially in the form
attached hereto (the "Bailee Letter").
5. FHLMC REQUIRED DOCUMENTS. For each Mortgage Loan intended to be included in
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a FHLMC pool, Customer shall deposit with Custodian the following required
documents (the "FHLMC Required Documents"), and/or all such other documents as
FHLMC or Nikko may require from time to time for either the issuance of the
related FHLMC securities or the purchase by FHLMC of such Mortgage Loan, duly
authorized and completed:
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(a) the original note, bearing all intervening endorsements, endorsed "Pay to
the order of ________, without recourse" and signed in the name of Customer
by an Authorized Representative of Customer, unless otherwise specified by
FHLMC;
(b) an original assignment of mortgage or deed of trust (hereinafter referred
to as assignment of mortgage or assignment) from Customer with assignee in
blank, in form and substance acceptable for recording, but not recorded,
unless otherwise specified by FHLMC;
(c) the original of all intervening assignments of mortgage, if any, unless
otherwise specified by FHLMC;
(d) a completed Warehouse Lender's Release Letter, unless such mortgage loans
are already subject to a lien by Nikko under this Agreement;
(e) a Mortgage Loan Submission Schedule on Form 11 (fixed rate), Mortgage
Submission Voucher on Form 13SF (ARM, GPM), or other appropriate form;
(f) a Contract Delivery Summary on Form 381;
(g) a Warehouse Lender Release of Security Interest on Form 996 listing either
(i) NSI as the only subscriber and as the sole person to which the related
FHLMC securities shall be delivered, or (ii) wire transfer instructions
listing Nikko as the recipient of such funds wired, with the signature of
the person authorized to sign on behalf of Nikko in blank; and
(h) either (i) a Security Settlement Information and Delivery Authorization on
Form 939 listing NSI as the only subscriber and as the sole person to which
the related FHLMC securities shall be delivered; (ii) a Wire Transfer
Authorization for Cash Warehouse Delivery on Form 987 listing Nikko as the
recipient of such funds wired; or (iii) a Bailee Letter for execution by
Custodian.
6. TABLE FUNDING REQUIRED DOCUMENTS. For each Mortgage Loan intended to be
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financed by Customer with funds provided by Nikko through Custodian (on behalf
of Nikko) directly to a Closing Agent, Customer shall deposit or cause to be
deposited with Custodian the following required documents (the "Table Funding
Required Documents"), and all such other documents as Nikko may require from
time to time, duly authorized and completed:
(a) the original note, bearing all intervening endorsements, endorsed "Pay to
the order of ________ without recourse" and signed in the name of Customer
or its correspondent by an Authorized Representative of Customer or its
correspondent, unless otherwise specified by Nikko;
(b) an original assignment of mortgage or deed of trust (hereinafter referred
to as assignment of mortgage or assignment) from Customer with assignee in
blank, in form and substance acceptable for recording, but not recorded,
unless otherwise specified by Nikko;
(c) the original of all intervening assignments of mortgage, if any, unless
otherwise specified by Nikko;
(d) a schedule of mortgage loans in computer-readable form acceptable to Nikko
and Custodian.
(e) if funds are sent by Nikko through Custodian (on behalf of Nikko) directly
to a Closing Agent, a letter executed by Customer and sent to the Closing
Agent which contains specific language that either (i) states that if for
any reason the Mortgage Loan does not close within three (3) business days
(for purposes of this Agreement, "business day" shall mean any day when
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Custodian is open for business) of its receipt of funds the Closing Agent
must immediately return all funds to Bankers Trust Company of California,
N.A. ABA#000000000 for further credit to Nikko Financial Services, Inc.
Settlement Account, Reference: (Customer) or (ii) is substantially in the
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form attached hereto ("Escrow Letter"), and
(f) in connection with a Mortgage Loan for which the documents set forth in
Sections 6(a), (b) and (c) have not yet been deposited with Custodian (a
"Wet Mortgage Loan"), on the business day immediately prior to the
scheduled date of the related Advance, a fully completed closing notice for
such Wet Mortgage Loan in a form acceptable to Nikko and communicated to
Custodian (a "Wet Closing Notice"). The receipt of the Wet Closing Notice
shall constitute a Table Funding Required Document and shall be deemed to
satisfy the requirement for the deposit of the documents set forth
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in Sections 6(a), (b) and (c) solely for purposes of the execution of the
related Trust Receipt (as defined below) as of the date thereof.
Notwithstanding the foregoing, Customer shall deposit with Custodian the
documents set forth in Sections 6(a), (b) and (c) for such Wet Mortgage
Loan within five (5) days after the date of the related Advance. If
Customer does not deposit such documents with Custodian within such five
day period, Custodian shall immediately notify Nikko. Upon receipt of such
documents by Custodian, Custodian shall review such documents in accordance
with the standards set forth in Section 9, shall promptly notify Nikko if
such documents do not comply with the requirements thereof and shall
indicate on its records that Custodian maintains possession of such
documents for Nikko hereunder. Customer hereby represents, warrants and
covenants to Nikko and Custodian that Customer and any person or entity
acting on behalf of Customer that has possession of any of the documents
set forth in Sections 6(a) (b) or (c) above, as applicable, for such Wet
Mortgage Loan prior to the deposit thereof with Custodian will hold such
documents in trust for Nikko.
7. INTERIM REQUIRED DOCUMENTS. For each Mortgage Loan other than one intended
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to be financed through Sections 3, 4, 5 and 6 hereof, Customer shall deposit
with Custodian the following required documents (the "Interim Required
Documents"'), and all such other documents as Nikko may require from time to
time, duly authorized and completed:
(a) the original note, bearing all intervening endorsements, endorsed "Pay to
the order of __________, without recourse" or as directed by and signed in
the name of Customer by an Authorized Representative of Customer, unless
otherwise specified by Nikko;
(b) an original assignment of mortgage or deed of trust (hereinafter referred
to as assignment of mortgage or assignment) from Customer with assignee in
blank, in form and substance acceptable for recording, but not recorded,
unless otherwise specified by Nikko;
(c) the original of all intervening assignments of mortgage, if any, unless
otherwise specified by Nikko;
(d) a completed Warehouse Lender's Release Letter, unless such mortgage loans
are already subject to a lien by Nikko under this Agreement; and
(e) a schedule of mortgage loans in computer-readable form acceptable to Nikko
and Custodian.
8. ESTABLISHMENT OF THE WIRE OUT AND SETTLEMENT ACCOUNTS. For each Mortgage
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Loan intended to be financed by Customer through funds provided by Nikko through
Custodian (on behalf of Nikko), Customer, Nikko and Custodian agree as follows:
(a) Custodian shall establish and maintain a deposit account (the "Wire Out
Account") for and on behalf of Nikko entitled "Nikko Financial Services,
Inc. Wire Out Account Reference: (Customer)." Upon request, Custodian
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shall provide the Closing Agent, Customer or Nikko with the federal wire
reference number or bank check number for a particular payment. All
related fees and expenses for such Wire Out Account shall be borne by
Customer.
(b) Custodian shall establish and maintain a deposit account (the "Settlement
Account") for and on behalf of Nikko entitled "Nikko Financial Services,
Inc. Settlement Account Reference: (Customer)." Customer will cause all
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proceeds from the sale of each Mortgage Loan subject to this Agreement to
be sent by the purchaser thereof directly to the Settlement Account and
Customer shall provide Custodian and Nikko with (i) written notice of funds
anticipated to be received by Custodian and Nikko respectively, (ii) a copy
of the purchase advice, if any, relating to such Mortgage Loan received
from the purchaser thereof, and (iii) a list of loan numbers to which such
funds relate. If Custodian does not receive funds in the amount of the
notice received under Section 8(b)(i) above, Custodian shall immediately
notify Nikko. All related costs, fees and expenses for such Settlement
Account shall be borne by Customer.
(c) Unless otherwise agreed, Customer will submit to Custodian and Nikko a
position and settlement report (the "P&S Report") in accordance with
procedures as are separately agreed to by Custodian and Nikko. Unless
otherwise agreed between Customer and Custodian, with respect to the Wire
Out Account, Customer will enter disbursement instructions through
Custodian's wire system or bank check system. Unless otherwise directed in
writing by Nikko, following receipt by Custodian of the relevant P&S
Report, an executed Collateral Receipt and all applicable Required
Documents, Custodian will release such wire instructions or bank checks and
immediately disburse such funds provided (i) sufficient funds exist in the
Wire Out Account, (ii) such instructions do not include Customer as payee,
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(iii) if applicable, Custodian has received an executed Escrow Letter from
the payee, and (iv) the payee on the Escrow Letter agrees with the payee
stated on the disbursement instructions. If a conflict exists between the
above instructions of Nikko and the instructions of Customer, Custodian
shall follow Nikko's instructions.
(d) Custodian will immediately disburse such funds in the Settlement Account as
directed in such P&S Report provided (i) sufficient funds exist in the
Settlement Account and (ii) Nikko has authorized such disbursements.
Notwithstanding the foregoing, if a conflict exists between the
instructions of Nikko and the instructions of Customer, Custodian shall
follow Nikko's instructions. Custodian shall have the right to correct
such P&S Report on behalf of Customer for errors and/or omissions, which
corrections shall be deemed to have been made by Customer.
9. CERTIFICATION OF DOCUMENTATION; ELIGIBLE COLLATERAL. (a) Custodian, upon
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receipt of all of the GNMA, FNMA, FHLMC, Interim, or Table Funding Required
Documents, as the case may be (collectively, the "Required Documents"), shall
review the related Collateral Receipt and such Required Documents in accordance
with the review and certification guidelines established by the respective
Agency or Nikko (as separately agreed to by Nikko and Custodian), as the case
may be, for their respective pool of Mortgage Loans to verify whether (i) all of
the Required Documents are in its possession, (ii) such documents have been
reviewed by it and appear regular on their face and relate to such Mortgage
Loan, (iii) based on its examination of such documents, the Required Documents
on their face satisfy the requirements set forth in Section 3, 4, 5, 6 or 7, as
applicable, and (iv) the related Collateral Receipt has been executed by an
Authorized Representative of Customer. Custodian makes no representations or
warranties as to and shall not be responsible to verify (i ) the validity,
legality, enforceability, sufficiency, due authority, recordability or
genuineness of any Required Document or of any of the Mortgage Loans or (ii) the
collectability, insurability, effectiveness or suitability of any such Mortgage
Loan. Subject to the provisions set forth in Section 6 hereof with respect to
Wet Mortgage Loans, Custodian shall notify Customer and Nikko in the form of an
exception report of any documents that are missing, incomplete on their face or
patently inconsistent. Customer shall promptly deposit such missing documents
with Custodian or complete or correct the documents. When the executed
Collateral Receipt and the related Required Documents have been received in full
and correct form, Custodian will: (a) promptly deliver a signed trust receipt
substantially in the form attached hereto ("Trust Receipt") to Nikko and its
designee, (b) promptly deliver a copy of the Warehouse Lender's Release Letter
if applicable to Nikko, (c) upon the written request of Customer, promptly
deliver the Required Documents referred to in Sections 3(f), (g), (h) and (i),
4(e), (f) and (g), 5 (a), (b), (e), (f), (g) and (h) and 7(a)(i) and (ii) or
7(b) (as applicable) to an Agency or an Authorized Purchaser, as the case may
be, (d) upon written request of Nikko, deliver either the original Required
Documents or copies thereof to Nikko, and (e) promptly transmit to Nikko and/or
its designee a schedule of mortgage loans underlying each Trust Receipt in
computer-readable form acceptable to Nikko and Custodian. In making such
verification, Custodian may rely conclusively on the Collateral Receipt
completed by Customer and the Required Documents, and Custodian shall have no
obligation to independently verify the correctness of Customer's certification
on such Collateral Receipt or the effectiveness, sufficiency, due authorization,
validity, enforceability, collectibility, recordability or adequacy of such
Collateral Receipt and the Required Documents.
(b) All Mortgage Loans deposited with Custodian under a Collateral Receipt
shall be deemed pledged to Nikko as Collateral. However, for purposes of
preparing the Trust Receipt, unless Custodian is notified by Nikko in writing to
the contrary, such Trust Receipt shall not include (i) second mortgages or (ii)
Mortgage Loans originated thirty (30) days or more prior to the requested
Advance Date, and such Trust Receipt shall not include, and shall deduct if
previously included: (i) Mortgage Loans with respect to which any Required
Documents have been returned to Customer for more than eighteen (18) days, (ii)
Mortgage Loans shipped to an Authorized Purchaser for more than thirty (30)
days, unless Custodian has received a confirmation from such Authorized
Purchaser that it will pay for such Mortgage Loan, and (iii) Mortgage Loans
subject to an Advance for more than seventy five (75) days. Custodian shall be
entitled to rely upon Nikko's information with respect to the preceding
exclusions. No notification by Nikko to Custodian pursuant to the preceding
sentence shall be effective unless the same shall be signed by Nikko, and any
such notification shall be effective only in the specific instance and for the
specific purpose for which given.
10. FURTHER OBLIGATIONS OF CUSTODIAN. For each Mortgage Loan held by Custodian
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under a Trust Receipt, Custodian shall maintain such mortgage loan data in
computer-readable form as separately agreed to in the review procedures
established by Nikko and Custodian and shall transmit such data electronically
each evening to Nikko and/or its designee in a format as established by Nikko
and Custodian.
Custodian shall immediately notify Nikko if (i) Customer fails to pay any amount
due Custodian under this Agreement or otherwise, or (ii) Custodian has actual
knowledge that any mortgage, pledge, lien, security interest or other charge or
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encumbrance (other than for the benefit of Nikko) has been placed on any account
maintained by Customer with Custodian or on the Required Documents or that an
Agency has rejected any Required Document.
Custodian shall use reasonable care and due diligence in the performance of its
duties hereunder, shall hold the Required Documents in its fire rated storage
vault under its exclusive custody and control in accordance with customary
standards for such custody and shall maintain a fidelity bond plus document
hazard insurance in amounts as will be separately disclosed to Nikko.
Custodian hereby represent and warrants to Nikko that Custodian is not
controlled by, under common control with or otherwise affiliated with Customer,
and covenants and agrees with Nikko that prior to any such affiliation in the
future, Custodian shall promptly notify Nikko, and that this Agreement has been
duly authorized, executed and delivered by Custodian and constitutes the legal,
valid and binding obligation of Custodian, enforceable in accordance with its
terms.
Custodian hereby agrees to recognize any security interest or lien granted by
Customer to NSI.
11. RELEASE OF REQUIRED DOCUMENTS. (a) Customer may from time to time request
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Nikko and Custodian in writing to permit the temporary withdrawal of certain
Required Documents for the purpose of correction of errors therein or for
permanent withdrawal. Custodian may permit the withdrawal of up to two (2)
mortgage files for the purpose of correcting such Required Documents without the
written consent of Nikko. Any request for permanent release, or any request for
temporary release beyond the two (2) mortgage files, will require the prior
written consent of Nikko and shall be in the form of the Document Request
attached hereto (the "Document Request") from Customer. Customer shall be
responsible for obtaining Nikko's signature on such Document Request if item 3
or 4 thereof is circled. Custodian shall execute such Document Request, shall
return one (1) copy to Customer, shall forward one (1) copy to Nikko and shall
retain the original. Promptly upon completion of such correction and in any
event within eighteen (18) days, Customer shall return such Required Documents
to Custodian. Custodian shall immediately notify Nikko if Customer has not
returned such Required Documents to it within the eighteen (18) days.
(b) If Customer desires to sell Mortgage Loans to an Agency or Authorized
Purchaser, Custodian shall complete the endorsements at the Customer's expense
and shall forward such related Required Documents as instructed by Customer in
writing to effect such securitization by, or sale to, the respective Agency or
Authorized Purchaser, together with a duly executed and completed Bailee Letter.
Customer shall make a reasonable effort to require such Authorized Purchaser to
execute such Bailee Letter and return it to Custodian.
12. RIGHT TO INSPECT. Custodian shall permit (i) inspection at all reasonable
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times during regular business hours by Nikko (or by its auditors when requested
by Nikko) of the Required Documents and the records of Custodian relating to
this Agreement and (ii) Nikko (or its auditors when requested by Nikko) to make
copies of the Required Documents and the records of Custodian relating to this
Agreement at the expense of Nikko.
13. DELIVERY OF REQUIRED DOCUMENTS TO NIKKO. Custodian shall promptly deliver
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to Nikko or its designee any or all Required Documents and other items of
Collateral in Custodian's custody upon Nikko's written request. Nikko shall
provide Customer with a copy of any such notice delivered to Custodian. Written
instructions as to the method of shipment and shipper(s) Custodian is directed
to utilize in connection with the delivery of Required Documents in the
performance of Custodian's duties hereunder shall be delivered by Nikko to
Custodian prior to any shipment of Required Documents pursuant to the request of
Nikko hereunder. Nikko will arrange for the provision of such services at its
sole cost and expense (or, at Custodian's option, reimburse Custodian for all
costs and expenses incurred by Custodian consistent with such instructions) and
will maintain such insurance against loss or damage to the Required Documents as
Customer deems appropriate.
14. CUSTODIAN FEES. It is understood that Custodian or its successor will
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charge such fees for its services under this Agreement as are set forth in a
separate agreement between Custodian and Customer, the payment of which,
together with Custodian's expenses in connection herewith, shall be solely the
obligation of Customer.
15. TERMINATION. Custodian may terminate its obligations under this Agreement
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upon thirty (30) days' prior written notice to Customer and Nikko. In the event
of such termination, Customer shall appoint a successor custodian, which shall
not be affiliated with Customer and shall be subject to approval by Nikko, and
Custodian shall promptly transfer to the successor custodian, as directed by
Nikko, all Required Documents and other items of Collateral being held by
Custodian
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under this Agreement. If, however, a successor custodian is not appointed by
Customer or Nikko within sixty (60) days, all duties and obligations of
Custodian shall cease and terminate. Custodian's sole responsibility thereafter
shall be to safely maintain all of the Custodian's mortgage files and to deliver
the same to a successor custodian, provided, however, if Customer and Nikko have
not appointed a successor custodian within thirty (30) days after the expiration
of the aforementioned sixty (60) day period, Custodian shall deliver such
documents to Nikko.
16. REPRESENTATIONS BY CUSTOMER. Customer hereby represents and warrants to
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Nikko and Custodian that:
(a) The proceeds of each Mortgage Loan have been fully advanced to the obligor
under the Mortgage Note or in accordance with the written directions of the
obligor as contained in the obligor's loan application;
(b) Any and all funds advanced into the Wire Out Account pursuant to Customer's
request in accordance with Section 8(a) shall be deemed to be an Advance to
Customer;
(c) The Wire Out Account shall be used only to disburse funds for the sole
purpose of funding the related Mortgage Loan or to return funds to Nikko;
(d) Except for any funds to be advanced by Nikko as contemplated by Section
6(f), all other documents and requirements to create an enforceable first
or second lien mortgage, as applicable, on the related real property have
been completed and duly executed with respect to each Mortgage Loan held by
Custodian pursuant to this Agreement; and
(e) All Required Documents related to such Mortgage Loans withdrawn from
Custodian shall be held in trust by Customer for Nikko, and Customer will
not attempt to pledge, hypothecate or otherwise transfer such Mortgage
Loans to any other party until the related Advance has been paid in full.
17. NOTICES. All written communications hereunder shall be mailed, telecopied
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or delivered to each party at its address as indicated on the signature page
hereof or at such other address as shall be designated by such party in a
written notice to the other parties. All notices and communications shall be
effective when delivered.
18. CONCERNING THE CUSTODIAN. Custodian shall not be liable for any action or
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omission to act hereunder, except for its own negligence or wilful misconduct.
In no event shall Custodian have any responsibility to ascertain or take action
with respect to the Required Documents or other items of Collateral, except as
expressly provided herein. Custodian may act in reliance upon any written
communication of Customer and Nikko concerning the delivery of the Required
Documents and other items of Collateral pursuant to this Agreement. Custodian
does not assume and shall have no responsibility for, and makes no
representation as to monitoring the value of the Required Documents and other
items of Collateral.
19. REPRESENTATIONS BY CUSTODIAN. Custodian hereby represents and warrants
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that it does not have, and will not assert, any security interest, lien, claim
or other adverse interest against the Required Documents or any other item of
Collateral. Custodian represents that it has the authority to enter into this
Agreement and that this Agreement has legality, validity, binding effect and
enforceability with respect to Custodian.
20. DUTIES OF CUSTODIAN. Custodian shall have no duties or responsibilities,
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and shall be under no responsibility or duty with respect to the disposition of
any Required Documents while such Required Documents are not in its possession,
except those that are specifically set forth herein or mutually agreed to with
Nikko in writing. If Custodian shall request instructions from Nikko with
respect to any act, action or failure to act in connection with this Agreement,
Custodian shall be entitled to refrain from taking such action and continue to
refrain from acting unless and until Custodian shall have received written
instructions from Nikko without incurring any liability therefor to Nikko,
Customer or any other person.
If Custodian shall at any time receive conflicting instructions from Nikko and
Customer with respect to the Required Documents and the conflict between such
instructions cannot be resolved by reference to the terms of this Agreement,
Custodian shall be entitled to rely on the instructions of Nikko. In the
absence of bad faith, negligence or wilful misconduct on the part of Custodian,
Custodian may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any request, instruction,
certificate, opinion or other document furnished to Custodian, reasonably
believed by Custodian to be genuine and to have been signed or presented by the
proper party or parties and conforming to the requirements of this Agreement.
Custodian may rely upon the validity of documents delivered to it, without
investigation as to their authenticity or legal effectiveness, and Customer will
hold Custodian
7
harmless from any claims that may arise or be asserted against Custodian because
of the invalidity of any such documents or their failure to fulfill their
intended purpose. Custodian shall not be responsible to Nikko or any other party
for recitals, statements or warranties or representations of Customer or Nikko
contained herein or in any document, or be bound to ascertain or inquire as to
the performance or observance of any of the terms of this Agreement or any other
agreement on the part of any party, except as may otherwise be specifically set
forth herein. No provision of this Agreement shall require Custodian to expend
or risk its own funds or otherwise incur financial liability in the performance
of its duties under this Agreement if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity is not reasonably
assured to it. Custodian may consult with counsel with regard to legal questions
arising out of or in connection with this Agreement and the advice or opinion of
such counsel shall be full and complete authorization and protection in respect
of any action taken, omitted or suffered by Custodian in good faith in
accordance therewith.
Nikko hereby authorizes and directs Custodian to sign on behalf of Nikko each of
the Required Documents referred to in Sections 3, 4 and 5 hereof. Without
limiting the generality of the foregoing, Custodian may rely upon and shall be
protected in acting in good faith upon any notice or other communication
received by it and which it reasonably believes to be genuine and duly
authorized with respect to all matters pertaining to this Agreement and its
duties hereunder; provided, however, that nothing set forth in this section
shall relieve Custodian of its obligations set forth in Section 9 of this
Agreement.
21. INDEMNIFICATION. Customer agrees to reimburse, indemnify and hold harmless
---------------
Custodian, its directors, officers, employees or agents from and against any and
all cost, expense, loss or other liability, including reasonable fees and
expenses of counsel arising from or connected with Custodian's execution and
performance of this Agreement and any review procedures and certification
guidelines established by the respective Agency or Nikko ("Costs"), including
but not limited to the claims of any third parties, including Nikko, except in
the case of Costs resulting from negligence or wilful misconduct on the part of
Custodian. To the extent Custodian is not reimbursed, indemnified or held
harmless by Customer, Nikko will reimburse, indemnify and hold harmless
Custodian, its directors, officers, employees and agents for Costs arising from
any action or refraining from action in accordance with instructions given to
Custodian by Nikko, except in the case of Costs resulting from negligence or
wilful misconduct on the part of Custodian, and Customer shall reimburse Nikko
for any sums so expended by Nikko. Custodian may enter into a settlement
agreement with respect to any matter for which indemnity is granted pursuant to
this paragraph. The foregoing indemnification shall survive any resignation of
the Custodian or termination of this Agreement.
22. AUTHORIZATIONS. The persons whose signatures and titles appear on the
--------------
signature page hereof ("Authorized Representatives"') are authorized, acting
singly, to act for Customer, Nikko or Custodian, as the case may be, under this
Agreement. From time to time, each party may supplement or amend the list of
Authorized Representatives and specimen signatures by notice to the other
parties, but each of the parties shall be entitled to rely conclusively on the
then current list until receipt of a superseding list. Custodian may rely, and
shall be protected in acting or refraining from action, upon any written
instruction, notice, order, request, direction, certificate, opinion or other
instrument or document believed by Custodian to be genuine and to have been
signed or presented by an Authorized Representative in the case of Customer and
Nikko and by the proper party or parties, in all other cases.
23. AMENDMENTS, ETC. Except as otherwise expressly provided herein, no
---------------
amendment or waiver of any provision of this Agreement nor consent to any
failure to comply herewith shall in any event be effective unless the same shall
be in writing and signed by all the parties hereto (provided that Nikko may
modify the Required Documents and may, if applicable, specify any additional
Required Documents to be delivered in connection with the Mortgage Loans by
giving notice of such modification or specification to Customer and Custodian,
which notice is not objected to by Customer within one (1) business day after
being given), and then such amendment, waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given. This
Agreement constitutes the entire agreement and understanding of the parties with
respect to those matters and transactions contemplated by this Agreement and
supersedes any prior agreement and understandings with respect to those matters
and transactions. The provisions of this Agreement set forth the exclusive
duties of Custodian, and no implied duties shall be read into this Agreement
against Custodian. Schedule I hereto may be amended from time to time by
agreement between Nikko and Customer with notice to Custodian.
24. SEVERABILITY. If any provision of this Agreement is declared invalid by
------------
any court of competent jurisdiction, such invalidity shall not affect any other
provision, and this Agreement shall be enforced to the fullest extent permitted
by law.
8
25. BINDING EFFECT; GOVERNING LAW. This Agreement shall be binding and inure
-----------------------------
to the benefit of the parties hereto and their respective successors and
assigns, provided, however, that neither Customer nor Custodian may assign this
Agreement or any of its rights or obligations hereunder, except with the prior
written consent of Nikko. Nikko may pledge or assign its security interest in
or lien on certain items of Collateral held by Custodian hereunder, whereupon
Nikko will act for the benefit of such assignee hereunder. This Agreement shall
be construed in accordance with, and governed by the law of the State of New
York, without giving effect to the conflict of law principles thereof. The
parties hereto waive trial by jury. Customer, Custodian, and Nikko each
irrevocably consent to the non-exclusive jurisdiction of any court of the State
of New York, or in the United States District Court for the Southern District of
New York in any action or proceeding arising out of or relating to this
Agreement. The parties hereby submit to, and waive any objection they may have
to personal jurisdiction and venue in, the courts of the State of New York and
the United States District Court for the Southern District of New York, over any
disputes arising out of or relating to this Agreement.
26. CONFLICTING DOCUMENTS. In the event that the written review procedures
established by the respective Agency or Nikko and Custodian conflict with this
Agreement, such review procedures shall prevail. Upon Custodian's actual
knowledge, Custodian shall immediately notify Nikko in writing of any such
conflict.
IN WITNESS WHEREOF, the parties have signed this Agreement as of the date and
year first above written.
Preferred Credit Corporation, as Customer
By: /s/ Xxxx X. Xxxxxxxxx
---------------------------------------
Name: Xxxx X. Xxxxxxxxx
-------------------------------------
Title: C.E.O.
------------------------------------
Address: 0000 Xxxxxxxxx Xxxxx, Xxxxx 000, Xxxxxx XX 00000
Attention:
--------------------------------
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Bankers Trust Company of California, N.A., as Custodian
By: /s/ Xxxx Xxxxxxx
--------------------------------
Name: Xxxx Xxxxxxx
Title: Vice President
Address: 0 Xxxx Xxxxx, 00xx Xxxxx, Xxxxxx, XX 00000
Attention: Tri-Party Custody/Nikko
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Nikko Financial Services, Inc.
By: /s/ Xxxxx X. Xxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxx
Title: Managing Director
Address: 000 Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Asset-Backed Finance Desk
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
9
SCHEDULE I
LIST OF AUTHORIZED PURCHASERS
BankAmerica
Bear Xxxxxxx Mortgage Capital, Inc.
Capstead Mortgage Corporation
Chase Mortgage Corporation
Citicorp Mortgage, Inc.
Countrywide Funding Corporation
Countrywide Home Loans
CWM Mortgage Holdings, Inc.
DLJ Mortgage Capital, Inc.
Federal National Mortgage Association
Federal Home Loan Mortgage Corporation
CS First Boston Corporation
First Nationwide
Flagstar Bank
Fleet Mortgage Corporation
Fleet Mortgage Group
GE Capital Mortgage Services, Inc.
Greenpoint Mortgage Corporation
Greenwich Capital Markets
Headland Mortgage Company
HomeSide Mortgage Corporation
Household Mortgage
Imperial Credit Industries, Inc.
Independent National Mortgage Corporation
Industrial Bank of Japan
Inland Mortgage
Marine Midland Mortgage
Mellon Mortgage Co.
Xxxxxxx Xxxxx Mortgage Capital, Inc.
Nationsbank Mortgage Corporation
North American Mortgage Co.
Norwest Mortgage, Inc.
PHH Mortgage Services
PNC Mortgage Securities Corporation of America
PNC Mortgage Corporation of America
Principal Residential Mortgage
Residential Funding Corporation
Resource Bancshares Mortgage
Saxon Mortgage Funding Corporation
Source One Mortgage
Standard Federal Bank
--------------------------------------------
--------------------------------------------
--------------------------------------------
--------------------------------------------
--------------------------------------------
10
COLLATERAL RECEIPT NUMBER __________
Date: ________________
AGGREGATE FACE VALUE: $ AGGREGATE UNPAID PRINCIPAL BALANCE $
---------- -------
Bankers Trust Company of California, N.A.
0 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxx, XX 00000
RE: Delivery of Required Documents to Custodian pursuant to the Tri-Party
Custody Agreement dated June 13, 1997 (the "Custody Agreement") among Preferred
Credit Corporation ("Customer"), Bankers Trust Company of California, N.A.
("Custodian") and Nikko Financial Services, Inc. (with its successors and
assigns, "Nikko"). Capitalized terms not defined herein have the respective
meanings assigned thereto in the Custody Agreement.
In consideration of Nikko making an Advance to finance the Mortgage Loans having
an aggregate face value and unpaid principal balance as indicated above, as more
fully described in a schedule attached hereto, the undersigned duly authorized
officer of Customer hereby certifies, represents and warrants that:
(a) it does hereby convey, transfer, mortgage, hypothecate, pledge, grant and
assign to Nikko and its successors and assigns, a first priority perfected
security interest in and lien on all of Customer's right, title and
interest in, under and to the properties, estates, rights and privileges,
whether now existing or hereafter acquired in all documents related to such
Mortgage Loans (including but not limited to mortgages, insurance policies,
loan applications and appraisals) and any and all proceeds therefrom, until
the Advances secured by such Mortgage Loans are repaid in full;
(b) the Required Documents with respect to such Mortgage Loans have been or are
hereby submitted to Custodian pursuant to the Custody Agreement;
(c) all other documents related to such Mortgage Loans have been or will be
created and held by Customer in trust for Nikko;
(d) the following statements are true and correct on the date hereof: (i) each
of the representations and warranties contained in all of the documents
executed by Customer related to the Advances collateralized by the Mortgage
Loans identified herein are true and correct in all material respects, (ii)
no Default or Event of Default has occurred and is continuing, and (iii) if
applicable, Customer has delivered and validly assigned genuine and
enforceable purchase commitments to The Nikko Securities Co. International,
Inc., each in an aggregate amount equal to the face value of the relevant
mortgage pool. At the request of Nikko, all documents related to such
Mortgage Loans will be immediately delivered to Custodian, Nikko or its
assigns and may be inspected or verified at any time by such parties;
(e) except for Mortgage Loans expressly identified on the attached schedule as
being secured by second mortgages, each Mortgage Loan listed on Schedule I
hereto is secured by a valid and enforceable "first lien" (as customarily
referred to in the industry) on existing site-built residential real
property; and
(f) (check the applicable statement below:)
__ no lien exists with respect to the Mortgage Loans listed on the attached
schedule;
__ a lien secured by Mortgage Loans listed on the attached schedule is
still in effect with Nikko; or
__ a lien secured by the Mortgage Loans identified herein is currently in
effect and a Warehouse Lender's Release Letter has been delivered to
Custodian under separate cover.
Preferred Credit Corporation, as Customer
By:
---------------------------------------
Title:
------------------------------------
11
WAREHOUSE LENDER'S RELEASE LETTER
Date: _______________, 199__
Nikko Financial Services, Inc.
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn.: Operations/Asset-Backed Finance
Facsimile: (212) 416- 5531
RE: Customer: Preferred Credit Corporation
RE: Agency ___________ Identification/Pool # _________ Security Rate _____%
Maturity: __________
The undersigned (the "Warehouse Lender") hereby releases all right, interest or
claim of any kind with respect to the mortgage loans (including all related
items constituting the complete file for each such mortgage loan) constituting
the mortgage pool referenced above, as may be further described in the attached
schedule, such release to be effective automatically without any further action
by any party, upon payment for the account of Customer of $________________ in
immediately available funds to account number #_______________ at (specify Bank)
for the account of ________________________________________________.
Very truly yours,
_______________________________________________, as Warehouse Lender
By:
--------------------------------------------
Name:
------------------------------------------
Title:
-----------------------------------------
Telephone:
-------------------------------------
copy to:
Preferred Credit Corporation, as Customer
Address:
-------------------------------------
----------------------------------------------
Attention:
-----------------------------------
Note: The above dollar amount should be EQUAL TO or LESS THAN the amount being
funded.
If no lien exists, this form must still be sent - Customer should put a slash
through the form, indicate "NOT APPLICABLE" and sign.
12
BAILEE LETTER
Date: _______________, 199__
Purchaser:
--------------------------
Address:
---------------------------
Attention:
--------------------------
Gentlemen:
Attached please find those mortgage loans listed separately on the attached
schedule (the "Mortgage Loans"), which Mortgage Loans are owned by Preferred
Credit Corporation ("Customer") and are being delivered to you for purchase.
The Mortgage Loans comprise a portion of the Collateral (as such term is defined
in the Tri-Party Custody Agreement ("Custody Agreement"), dated June 13, 1997,
as it may hereafter be amended, by and among Customer, Bankers Trust Company of
California, N.A. as Custodian ("Custodian"), and Nikko Financial Services, Inc.
(with its successors and assigns, "Nikko")). Each of the Mortgage Loans is
subject to a security interest in favor of Nikko, which security interest shall
be automatically released upon Nikko's receipt of the full amount of the
purchase price of such Mortgage Loan (as set forth on the schedule attached
hereto) by wire transfer to the following account maintained with Nikko:
Bankers Trust Company of California, N.A. ABA#000000000, Account #__________
for further credit to Nikko Financial Services, Inc. Settlement Account,
Reference: (Customer)
--------
Pending your purchase of each Mortgage Loan and until payment therefor is
received by Nikko, the aforesaid security interest therein will remain in full
force and effect, and you shall hold possession of such Collateral and the
documentation evidencing same as custodian, agent and bailee for and on behalf
of Custodian for Nikko. In the event any Mortgage Loan is unacceptable for
purchase, return the rejected item directly to the undersigned at the address
set forth below. In no event shall any Mortgage Loan be returned or sales
proceeds remitted to the Customer. The Mortgage Loan must be so returned or
sales proceeds remitted in full no later than twenty-one (21) days from the date
hereof, unless otherwise agreed by Custodian. If you are unable to comply with
the above instructions, please so advise the undersigned immediately.
NOTE: BY ACCEPTING THE MORTGAGE LOANS DELIVERED TO YOU WITH THIS LETTER, YOU
CONSENT TO BE THE CUSTODIAN, AGENT AND BAILEE FOR CUSTODIAN ON BEHALF OF NIKKO
ON THE TERMS DESCRIBED IN THIS LETTER. THE UNDERSIGNED REQUESTS THAT YOU
ACKNOWLEDGE RECEIPT OF THE ENCLOSED MORTGAGE LOANS AND THIS LETTER BY SIGNING
AND RETURNING THE ENCLOSED COPY OF THIS LETTER TO THE UNDERSIGNED AT THE
FOLLOWING ADDRESS: 0 XXXX XXXXX, 00XX XXXXX, XXXXXX, XX 00000 ATTENTION: CUSTODY
DEPARTMENT. HOWEVER, YOUR FAILURE TO DO SO DOES NOT NULLIFY SUCH CONSENT.
Sincerely, Acknowledged and Agreed:
Bankers Trust Company of -----------------------------------------
California, N.A. as Purchaser
as Custodian for Nikko,
its successors and assigns
By: By:
-------------------------------- --------------------------------------
Name: Name:
------------------------------ ------------------------------------
Title: Title:
----------------------------- ----------------------------------
13
ESCROW LETTER
ADDENDUM TO ESCROW INSTRUCTIONS
-------------------------------
Dated: _______________, 199__
Escrow #: ______________________________________
Customer: ______________________________________
The funds to be used for closing this transaction may be provided via wire
transfer from Bankers Trust Company of California, N.A.
You are to hold the closing funds in trust for Bankers Trust Company of
California, N.A. until such time as the funds are disbursed in accordance with
the escrow instructions. If the loan is not funded within three (3) business
days of receipt of the funds, you are to return such funds via federal funds
wire to Bankers Trust Company of California, N.A. as follows:
Bankers Trust Company of California, N.A., ABA#000000000 for further credit to
Account #__________________ Reference: /Nikko/(Customer)
--------
Between the time the funds are received and the loan is funded you are to accept
instructions regarding the use of the funds that are in conflict with the escrow
instructions only in writing from Bankers Trust Company of California, N.A..
This Addendum to Escrow Instructions shall be irrevocable and can only be
modified with the express written approval of Bankers Trust Company of
California, N.A.
Agreed and Acknowledged:
Closing Agent: ________________________________________
By: ___________________________________________________
Escrow Officer
14
DOCUMENT REQUEST
To: Bankers Trust Company of California, N.A.
Request #_______________________
Re: Tri-Party Custody Agreement, among Nikko Financial Services, Inc. (with its
successors and assigns, "Nikko"), Preferred Credit Corporation ("Customer") and
Bankers Trust Company of California, N.A. ("Custodian"), dated June 13, 1997
(the "Custody Agreement").
In connection with the Mortgage Loans held by Custodian for Nikko, Customer
hereby requests and acknowledges receipt of the Required Documents for the
Mortgage Loan described below, for the reason indicated. Custodian, Nikko and
Customer shall, by signature below, acknowledge such action as appropriate, and
Customer certifies that it has sent a copy of this Document Request to the other
parties. Customer agrees that all Required Documents received by it must be
returned or sales proceeds remitted in full to Custodian no later than eighteen
(18) calendar days from the date hereof.
Mortgagor's Name, Address and Zip Code:_________________________________________
Mortgage Loan Number: ______________________ Original Principal Amount: $______
Reason for withdrawing Required Documents (circle one):
1. Mortgage Loan has been paid in full
2. Mortgage Loan is being permanently withdrawn from the Collateral
3. Mortgage Loan is in foreclosure
4. Mortgage Loan being temporarily withdrawn for document correction (explain)
If item 1 or 2 is circled, Customer hereby certifies that the related Advance
has been repaid in full and Custodian, upon determining that the related Advance
has been repaid in full, shall release to Customer any and all documents in its
possession relating to the specified Mortgage Loan.
If item 3 or 4 is circled, Custodian shall release the specified documents to
Customer and Customer acknowledges that (a) such documents are being held by
Custodian in pledge on behalf of and as agent for Nikko pursuant to the Custody
Agreement and are subject to a security interest in favor of Nikko, and (b) it
agrees to hold such documents as custodian, agent and bailee for and on behalf
of Custodian for Nikko.
Date: By: as Customer
-------------------------------- -------------------------
Date: By: as Custodian
-------------------------------- -------------------------
Date: By: as Nikko (if item 3 or 4 is circled)
-------------------------------- -------------------------
Acknowledgment that documents have been released to, and received by, Customer:
Date: By: as Customer
-------------------------------- ------------------------
Acknowledgment that documents have been returned to Custodian:
Date: By: as Customer
-------------------------------- -------------------------
Date: By: as Customer
-------------------------------- -------------------------
15
TRUST RECEIPT
Dated: ____________________ , 199__
TRUST RECEIPT NUMBER: ORIGINAL PRINCIPAL BALANCE: $
------------ ----------------
NIKKO CUSIP NUMBER: UNPAID PRINCIPAL BALANCE: $
-------------- ----------------
(UPB to be left blank by Custodian)
The Bank of New York
Xxx Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Tri-Party Custody Agreement dated June 13, 1997, between Preferred Credit
Corporation, ("Customer"), Nikko Financial Services, Inc. (with its
successors and assigns, "Nikko") and Bankers Trust Company of California,
N.A., ("Custodian") (the "Custody Agreement").
In accordance with the provisions of the above-referenced Custody Agreement, the
undersigned, as Custodian, hereby certifies that, as to each mortgage loan
described in the schedule attached hereto ("Mortgage Loan"), it has reviewed its
required document files and has determined that (check the applicable item):
__ (a) it is in receipt of (i) the original note ("Note"), endorsed to
Custodian or in blank, and (ii) the related original assignment of mortgage,
with assignee as Custodian or in blank but otherwise in recordable form, but
not recorded ("Assignment"); or
__ (b) with respect to Wet Mortgage Loans, it has received a Wet Closing Notice
in accordance with the requirements of Section 6(f) of the Custody
Agreement.
The undersigned as custodian, hereby further certifies that (i) such Required
Documents have been reviewed by it and appear regular on their face and relate
to such Mortgage Loan, (ii) such Required Documents are in its possession, and
(iii) such Required Documents are being held by it for Nikko.
At any time, upon request of Nikko you may exchange this original Trust Receipt
for two or more trust receipts (the "Substitute Trust Receipts") each of which
will be in substantially the form of this Trust Receipt and relate to such
Mortgage Loans as may be specified by Nikko.
This Trust Receipt is not negotiable. You may only transfer this Trust Receipt
by an endorsement by Nikko provided that (i) this Trust Receipt is held by you,
acting as custodian for Nikko or under the applicable tri-party custody
agreement ("Repo Custody Agreement") in connection with the applicable Master
Repurchase Agreement (the "Repurchase Agreement") and (ii) an Event of Default
certificate (as defined in the Repo Custody Agreement) has been received by you,
or issued by you, and then you may transfer this Trust Receipt or the
appropriate Substitute Trust Receipt to the buyer under the applicable
Repurchase Agreement (the "Buyer").
We will accept and act on instructions with respect to this Trust Receipt or the
Mortgage Loans only upon surrender of this receipt at our office, located at 0
Xxxx Xxxxx, 00xx Xxxxx, Xxxxxx, XX 00000, Attention: Tri-Party Custody/Nikko.
If this Trust Receipt has been endorsed and is held by Buyer, we will accept and
act on instructions from the endorsee only if the Event of Default certificate
is executed and delivered to us stating that an Event of Default has occurred
under a Repurchase Agreement relating to this Trust Receipt between Nikko and
the Buyer. This Trust Receipt shall be superseded and voided by a more recently
delivered Trust Receipt.
Bankers Trust Company of California, N.A., as Custodian
By:
---------------------------
Name:
-------------------------
Title:
------------------------
16
