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EXHIBIT 10.33
FORM OF HONOMO SECURITY AGREEMENT
AMENDED AND RESTATED SECURITY AND COLLATERAL AGENCY AGREEMENT, dated
January 31, 1997, made by HONOLULU MORTGAGE COMPANY, INC., a Hawaiian
corporation (the "Grantor"), THE CHASE MANHATTAN BANK, in its capacity as
Administrative Agent under the Credit Agreement referred to below (in such
capacity, the "Administrative Agent ) and THE FIRST NATIONAL BANK OF BOSTON, as
Collateral Agent for the financial institutions party to the Credit Agreement
referred to below (in such capacity, the "Collateral Agent").
W I T N E S S E T H:
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WHEREAS, the Grantor has entered into an Amended and Restated Credit
Agreement, dated as of January 31, 1997, with HomeSide Lending, Inc., a Florida
corporation, the financial institutions from time to time party thereto, as
Lenders (the "Lenders"), the lenders from time to time designated therein as
Balance Lenders (the "Balance Lenders"), the Collateral Agent and the
Administrative Agent (said Agreement, as it may be amended, supplemented or
otherwise modified from time to time, being the "Credit Agreement"); and
WHEREAS, the Credit Agreement amends and restates in its entirety the
Existing Credit Agreement;
WHEREAS, the obligations of the Grantor under the Existing Credit
Agreement are secured pursuant to, INTER ALIA, the Security and Collateral
Agency Agreement, dated as of May 31, 1996 (the "EXISTING HONOMO SECURITY
AGREEMENT") among the parties to this Agreement; and
WHEREAS, it is a condition precedent to the making of the Loans that
the Existing HonoMo Security Agreement shall have been amended and restated as
provided herein;
NOW, THEREFORE, in consideration of the premises the parties hereto
hereby agree that on the Closing Date the Existing HonoMo Security Agreement
shall be amended and restated in its entirety as follows:
1. DEFINED TERMS.
Terms defined in the UCC (as hereinafter defined) are used herein as
therein defined. As used in this Agreement, capitalized terms defined in the
Credit Agreement and not otherwise defined herein have the meanings given in the
Credit Agreement, and the following terms have the meanings specified below
(such meanings being equally applicable to both the singular and plural forms of
the terms defined):
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"ADDITIONAL REQUIRED DOCUMENTS" has the meaning set forth in Section
4(a) of this Agreement.
"AGENCY CUSTODIAL AGREEMENTS" shall mean, collectively, the FHLMC
Custodial Agreement, the FNMA Custodial Agreement and the GNMA Custodial
Agreement.
"APPROVED NON-AGENCY MORTGAGE LOAN" shall mean a Mortgage Loan in
respect of which the Grantor has Servicing Rights covered by a duly executed and
delivered Acknowledgment Agreement.
"CERTIFICATING CUSTODIAN" shall mean any Person acting as the
Grantor's "document custodian," "custodian" or "certificating custodian," as
such terms are used in the Agency Guides, for purposes of (a) certifying that
the documentation relating to Mortgage Loans received by such Person from the
Grantor (or the Collateral Agent) is complete and acceptable under the
applicable Agency Guide for purposes of including such Mortgage Loan in a pool
of Mortgage Loans in which Mortgage-Backed Securities will represent interests
and (b) holding such documentation following formation of such pools and
issuance of such Mortgage-Backed Securities. The Certificating Custodian shall
at all times be a party to the Agency Custodial Agreements.
"COLLATERAL" has the meaning set forth in Section 3 of this Agreement.
"FHLMC CUSTODIAL AGREEMENT" shall mean the agreement, as amended,
supplemented or otherwise modified from time to time, between FHLMC, the Grantor
and any Person meeting the eligibility requirements set forth in the FHLMC Guide
to serve as a "custodian," as such term is used in the FHLMC Guide, pursuant to
which such Person is authorized to act as Certificating Custodian for the
Grantor.
"FNMA CUSTODIAL AGREEMENT" shall mean the agreement, as amended,
supplemented or otherwise modified from time to time, between FNMA, the Grantor
and any Person meeting the eligibility requirements set forth in the FNMA Guide
to serve as a "document custodian," as such term is used in the FNMA Guide,
pursuant to which such Person is authorized to act as Certificating Custodian
for the Grantor.
"FUNDING ACCOUNT" shall mean account number [_________] maintained by
the Grantor with the Administrative Agent.
"GNMA CUSTODIAL AGREEMENT" shall mean the agreement, as amended,
modified or supplemented from time to time, between GNMA, the Grantor and any
Person meeting the eligibility requirements set forth in the GNMA Guide to serve
as a "certificating custodian," as such term is used in the GNMA Guide, pursuant
to which such Person is authorized to act as Certificating Custodian.
"MBS CUSTODY ACCOUNT" has the meaning set forth in Section 6(h) of
this Agreement.
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"MORTGAGE LOAN SETTLEMENT ACCOUNT" has the meaning set forth in
Section 6(c) of this Agreement.
"PROCEEDS" shall mean "proceeds," as such term is defined in Section
9-306(1) of the UCC, and, in any event, includes, without limitation, (a) any
and all proceeds of any insurance, indemnity, warranty or guaranty payable to
the Grantor from time to time with respect to any of the Collateral, (b) any and
all payments (in any form whatsoever) made or due and payable to the Grantor
from time to time in connection with any requisition, confiscation,
condemnation, seizure or forfeiture of all or any part of the Collateral by any
Governmental Authority (or any Person acting under color of Governmental
Authority), and (c) any and all other amounts from time to time paid or payable
under or in connection with any of the Collateral.
"SECURED OBLIGATIONS" shall mean, collectively, the unpaid principal
of and interest on the Loans and any Notes and all other obligations and
liabilities of the Grantor and each of the other Loan Parties to the Secured
Parties (including, without limitation, interest accruing at the then applicable
rate provided in the Credit Agreement after the maturity of the Loans and
interest accruing at the then applicable rate provided in the Credit Agreement
after the filing of any petition in bankruptcy, or the commencement of any
insolvency, reorganization or like proceeding, relating to the Grantor or any
other Loan Party, whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding), whether direct or indirect, absolute or
contingent, due or to become due, or now existing or hereafter incurred, which
may arise under, out of, or in connection with, the Credit Agreement, the Loans,
any Notes, the HonoMo Guaranty, this Agreement, the other Loan Documents or any
other document made, delivered or given in connection therewith, in each case
whether on account of principal, interest, reimbursement obligations, fees,
indemnities, costs, expenses or otherwise (including, without limitation, all
fees and disbursements of counsel to any of the Secured Parties that are
required to be paid by the Grantor or any other Loan Party pursuant to the terms
of the Credit Agreement, this Agreement or any other Loan Document).
"SECURED PARTIES" shall mean, collectively, the Lenders, the Balance
Lenders, the Collateral Agent and the Administrative Agent.
"SECURITIES SETTLEMENT ACCOUNT" has the meaning set forth in Section
6(j) of this Agreement.
"SERVICING CONTRACT" shall mean each of the contracts or other
agreements to which the Grantor is a party pursuant to which the Grantor holds
Servicing Rights, in each case as amended, supplemented or otherwise modified
from time to time, including, without limitation, (a) all rights of the Grantor
to receive moneys due and to become due to it thereunder or in connection
therewith, other than any portion of principal and interest payable under the
related Mortgage Loans to the extent not attributable to servicing fees payable
to the Grantor under such Servicing Contracts, (b) all rights of the Grantor to
damages arising out of, or for, breach or default in respect thereof, and (c)
all rights of the Grantor to perform and to exercise all remedies thereunder.
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"SERVICING RECEIVABLES" shall mean the accounts, receivables and other
amounts owing to the Grantor for its own account in respect of Servicing Rights
or under a Servicing Contract, including, without limitation, all Eligible
Servicing Receivables.
"SERVICING RIGHTS" shall mean the rights of the Grantor to (a) service
Mortgage Loans for or on behalf of the owner or holder of such Mortgage Loans
(including investors in Mortgage-Backed Securities supported by Mortgage Loans)
pursuant to a direct agreement between the Grantor and an Agency, Approved
Investor or such owner or holder, together with the legal titles, mortgagor
files, escrows and records relating to this Agreement, such Mortgage Loans and
the right to receive servicing fee income and any other income arising from or
in connection with such Mortgage Loans, including late charges, termination fees
and charges and all other incidental fees and charges, and (b) subservice
Mortgage Loans for or on behalf of the legal title holder of the direct
servicing rights in respect of, or the owner or holder of, such Mortgage Loans,
pursuant to a subservicing agreement in form and substance satisfactory to the
Administrative Agent between the Grantor and the legal title holder of the
related direct servicing rights, together with the legal titles, mortgagor
files, escrows and records relating to such Mortgage Loans and the right to
receive servicing or subservicing fee income and any other income arising from
or in connection with such Mortgage Loans, including late charges, termination
fees and charges and all other incidental fees and charges.
"SERVICING SETTLEMENT ACCOUNT" has the meaning set forth in Section
6.1(m) of this Agreement.
"UCC" shall mean the Uniform Commercial Code as the same may, from
time to time, be in effect in the State of New York; PROVIDED, HOWEVER, in the
event that, by reason of mandatory provisions of law, any or all of the
attachment, perfection or priority of the Collateral Agent's and the other
Secured Parties' security interest in any Collateral is governed by the Uniform
Commercial Code as in effect in a jurisdiction other than the State of New York,
the term "UCC" shall mean the Uniform Commercial Code as in effect in such other
jurisdiction for purposes of the provisions hereof relating to such attachment,
perfection or priority and for purposes of definitions related to such
provisions.
2. APPOINTMENT OF COLLATERAL AGENT.
Pursuant to the Credit Agreement the Collateral Agent has been
appointed to act as secured party, agent, bailee and custodian for the exclusive
benefit of the Secured Parties with respect to the Collateral. The Collateral
Agent hereby acknowledges that it has accepted such appointment and agrees to
maintain and hold all Collateral at any time delivered to it as secured party,
agent, bailee and custodian for the exclusive benefit of the Secured Parties.
The Collateral Agent acknowledges and agrees that it is acting and will act with
respect to the Collateral for the exclusive benefit of the Secured Parties and
is not, and shall not at any time in the future be, subject, with respect to the
Collateral, in any manner or to any extent, to the direction or control of the
Grantor or any of the other Loan Parties, except as expressly permitted
hereunder and under the other Loan Documents. The Collateral Agent agrees to act
in accordance with this Agreement and in accordance with any written
instructions from the Administrative Agent
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delivered pursuant to the Credit Agreement. Under no circumstances shall the
Collateral Agent deliver possession of Collateral to the Grantor or any other
Person (other than the Administrative Agent) or otherwise release any Collateral
from the Lien created hereby, except in accordance with the express terms of
this Agreement or otherwise upon the written instructions of the Administrative
Agent.
3. GRANT OF SECURITY INTEREST.
As collateral security for the full and prompt payment when due
(whether at stated maturity, by acceleration or otherwise) of, and the
performance of, all the Secured Obligations and to induce the Lenders to make
the Loans pursuant to the Credit Agreement, effective during any Negative
Security Event, the Grantor hereby assigns, conveys, mortgages, pledges,
hypothecates and transfers to the Collateral Agent, on behalf and for the
ratable benefit of the Secured Parties, and hereby grants to the Collateral
Agent, on behalf and for the ratable benefit of the Secured Parties, a security
interest in, all of the Grantor's right, title and interest in, to and under the
following, whether now owned or hereafter acquired, whether now in existence or
hereafter arising (all of which being herein collectively called the
"Collateral"):
(a) all Mortgage Loans submitted by the Grantor for inclusion in the
HonoMo Tranche A Borrowing Base and all Mortgage Loans purchased by the Grantor
with the proceeds of an Eligible Early Buyout Advance or an Eligible
Paid-in-Full Buyout Advance, including, without limitation, all notes,
mortgages, deeds to secure debt, trust deeds and security agreements, financing
statements and fixture filings related thereto, all rights to payment
thereunder, all rights in the Property securing payment of the indebtedness of
the Obligors thereunder or that are the subject of such Mortgage Loans, all
rights under documents related thereto, such as guaranties and insurance
policies (issued by an Agency or otherwise), including, without limitation,
mortgage and title insurance policies, fire and extended coverage insurance
policies (including the right to any return premiums) and FHA insurance and VA
guaranties and all rights, if any, in cash deposits consisting of impounds,
insurance premiums or other funds held on account thereof, all commitments and
other approvals issued by or on behalf of the FHA or the VA to insure or
guaranty any of the Mortgage Loans, and all Hedge Contracts relating to any of
the foregoing;
(b) all Mortgage-Backed Securities, all right to the payment of
moneys and non-cash distributions on account thereof and all new, substituted
and additional securities at any time issued with respect thereto, and all Hedge
Contracts related thereto;
(c) all Take-Out Commitments covering any part of the Collateral,
all rights to deliver Mortgage Loans and Mortgage-Backed Securities to investors
and other purchasers pursuant to such Take-Out Commitments, and all proceeds
resulting from the disposition of such Collateral pursuant thereto;
(d) all commitments and other agreements or approvals issued by or
on behalf of any Agency to issue, insure or guaranty any Mortgage-Backed
Security (other than any such
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commitments or approvals the creation of a security interest in which would be
prohibited thereby or by applicable law);
(e) all (i) Servicing Rights, (ii) Servicing Contracts and (iii)
Hedge Contracts held by the Grantor related thereto, (iv) rights to receive
payments in connection with Servicing Contracts, Servicing Rights and Hedge
Contracts, whether on account of the performance of services, upon the
termination of Servicing Rights, Servicing Contracts, Hedge Contracts or
otherwise (including, without limitation, all Eligible Servicing Receivables
(and all deeds, contracts, agreements, instruments of title and other documents
received or receivable in respect thereof)), and (v) rights with respect to the
placement of escrow deposits associated with such Servicing Rights and Servicing
Contracts and all rights to the payment of money or provision of concessions or
services with respect thereto;
(f) the Mortgage Loan Settlement Account, the Securities Settlement
Account, the Servicing Settlement Account, the MBS Custody Account, the Funding
Account and any other custodial account of the Grantor held by or in the name of
the Collateral Agent or its bailee or designee (including, without limitation,
the Administrative Agent), and any and all funds securities, Cash Equivalents
and other items at any time held in such accounts and any and all rights of the
Grantor to insurance payments made in respect of such accounts;
(g) all files, documents, agreements, instruments, deeds, chattel
paper, inventory consisting of Mortgage Loans, Mortgage-Backed Securities or
Servicing Rights held for sale, insurance policies, personal property, contract
rights, accounts, general intangibles, records, surveys, certificates,
correspondence, appraisals, computer records, tapes, discs, cards, accounting
records and other books, records, information and data of the Grantor relating
to the Collateral (including all such items necessary or helpful in the
administration or servicing of the Collateral) of whatever kind or nature
whatsoever relating to the Mortgage Loans described in subsection (a) above or
the servicing of Mortgage Loans, the Mortgage-Backed Securities, the Take-Out
Commitments, the Servicing Rights or any other Collateral, and all other
documents or instruments delivered to the Collateral Agent in respect of the
Collateral, including, without limitation, the right to receive all insurance
proceeds and condemnation awards which may be payable in respect of any of the
Property; and
(h) to the extent not otherwise included, all Proceeds of each of
the foregoing and all accessions to, substitutions and replacements for, and
rents, profits and products of, each of the foregoing.
4. DELIVERY OF COLLATERAL DOCUMENTATION: SUBMISSION OF COLLATERAL FOR
INCLUSION IN BORROWING BASES.
(a) DELIVERY OF MORTGAGE LOANS. From time to time, the Grantor shall
deliver or cause to be delivered to the Collateral Agent Eligible Mortgage Loans
to be included in the HonoMo Tranche A Borrowing Base as permitted pursuant to
the Credit Agreement, by delivery to the Collateral Agent of a HonoMo Tranche A
Borrowing Base Addition Report in the form of ATTACHMENT 1-A hereto, with all
blanks completed in conformity therewith, together with those
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documents, instruments and agreements described on ATTACHMENT 2 hereto (the
"Required Documents"), except to the extent such Eligible Mortgage Loan
constitutes an Eligible Wet Loan, in which case the Required Documents shall be
delivered to the Collateral Agent within 10 days after the date such Eligible
Wet Loan is included in the HonoMo Tranche A Borrowing Base. Additionally, if
requested by the Administrative Agent, the Grantor shall use diligent efforts to
promptly deliver to the Collateral Agent the items described on ATTACHMENT 8
hereto (tine "Additional Required Documents"). Whenever the Grantor shall
deliver Eligible Mortgage Loans for inclusion in the HonoMo Tranche A Borrowing
Base, the Grantor shall be deemed to have represented and warranted that (i) has
delivered to the Collateral Agent (or, in the case of an Eligible Wet Loan, will
deliver to the Collateral Agent within 10 days after the date such Eligible Wet
Loan is included in the HonoMo Tranche A Borrowing Base) the Required Documents,
and (ii) it holds in its possession or is using diligent efforts to obtain
possession of the Additional Required Documents and to deliver the Additional
Required Documents to the Collateral Agent. The Grantor shall hold the
Additional Required Documents in its possession in trust for the benefit of the
Secured Parties until delivery thereof to the Collateral Agent as provided
herein.
(b) DELIVERY OF MORTGAGE-BACKED SECURITIES. From time to time, the
Grantor shall deliver or caused to be delivered to the Collateral Agent or its
bailee (including, without limitation, the Administrative Agent) Eligible
Mortgage-Backed Securities to be included in the HonoMo Tranche A Borrowing Base
and shall confirm the issuance of Mortgage-Backed Securities, by delivery to the
Collateral Agent of a HonoMo Tranche A Borrowing Base Addition Report, in the
form of ATTACHMENT 1-B hereto, with all blanks completed in conformity
therewith, together with the Required Documents for such Mortgage-Backed
Securities.
(c) DELIVERY OF SERVICING RECEIVABLES: DELIVERY OF RECEIVABLES
CERTIFICATE. From time to time, the Grantor may designate Eligible Early Buyout
Advance Receivables, Eligible Paid-ln-Full Buyout Advance Receivables and
Eligible Foreclosure Advance Receivables for inclusion in the HonoMo Tranche B
Borrowing Base by delivering, or causing to be delivered, to the Collateral
Agent a HonoMo Tranche B Borrowing Base Addition Report, in the form of
ATTACHMENT 1-C, with all blanks completed in conformity therewith, together with
all Required Documents in respect of such Eligible Servicing Receivables.
Simultaneously with its delivery to the Administrative Agent of a notice of
borrowing and/or notice of payment in respect of each Tranche B Advance Loan and
Tranche B Swing Line Loan as required under the Credit Agreement, the Grantor
shall deliver, or cause to be delivered, to the Collateral Agent a Receivables
Certificate in the form of Attachment x-X, with all blanks completed in
conformity therewith.
(d) DESIGNATION OF MORTGAGE LOANS AND MORTGAGE-BACKED SECURITIES. By
designating a Mortgage Loan or Mortgage-Backed Security for inclusion in the
HonoMo Tranche A Borrowing Base in accordance with this Section 4, the Grantor
shall be deemed to represent and warrant to each of the Secured Parties at and
as of the date of such addition that such Mortgage Loan or Mortgage-Backed
Security constitutes an Eligible Mortgage Loan or Eligible Mortgage-Backed
Security, as the case may be. If any such Mortgage Loan or Mortgage-Backed
Security fails to constitute an Eligible Mortgage Loan or Eligible
Mortgage-Backed Security, at any time, then the Grantor shall promptly so notify
the
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Administrative Agent and the Collateral Agent by telefacsimile, and such
Mortgage Loan or Mortgage-Backed Security shall be deemed to have no value for
purposes of determining the HonoMo Tranche A Borrowing Base (whether or not the
Grantor has given such notice).
(e) DESIGNATION OF SERVICING RECEIVABLES. By designating Eligible
Servicing Receivables for inclusion in the HonoMo Tranche B Borrowing Base in
accordance with this Section 4, the Grantor shall be deemed to represent and
warrant to each of the Secured Parties at and as of the date of such inclusion
that such Eligible Servicing Receivables constitute Eligible Default-Related
Advance Receivables, Eligible Early Buyout Advance Receivables, Eligible
Foreclosure Advance Receivables, Eligible P&I Advance Receivables, Eligible
Paid-in-Full Buyout Advance Receivables or Eligible T&I Advance Receivables, as
the case may be. If any such servicing receivables fail to constitute Eligible
Default-Related Advance Receivables, Eligible Early Buyout Advance Receivables,
Eligible Foreclosure Advance Receivables, Eligible P&I Advance Receivables,
Eligible Paid-in-Full Buyout Advance Receivables or Eligible T&I Advance
Receivables, at any time, then the Grantor shall promptly so notify the
Administrative Agent and the Collateral Agent by telefacsimile, and such
Servicing Receivables shall be deemed to have no collateral value for purposes
of determining the HonoMo Tranche B Borrowing Base (whether or not the Grantor
has given such notice).
(f) COLLATERAL AGENT OFFICE. The Collateral Agent shall hold all
documentation relating to or constituting Collateral delivered to it from time
to time under this Agreement or any other Loan Document in accordance with the
provisions hereof and of the other Loan Documents in a fire resistant vault,
drawer or other suitable depository in an office maintained by the Collateral
Agent on premises owned or leased or subleased by it and occupied and controlled
solely by the Collateral Agent (the "Collateral Agent Office"), which
documentation shall (x) be conspicuously marked to show the Collateral Agent's
and the other Secured Parties' interests therein and (y) not be commingled with
any other assets or property of, or held by, the Collateral Agent. The
Collateral Agent Office may, in the discretion of the Collateral Agent, be
located on premises leased or subleased to the Collateral Agent by the Grantor
or an Affiliate of the Grantor, and may be adjacent to or in the same office
building as offices maintained and occupied by the Grantor or its Affiliates;
PROVIDED, HOWEVER, that (i) any such lease or sublease shall be in a form
customary in the location of such premises for arms'-length leases or subleases
of office premises between unrelated parties, and shall provide that the
Collateral Agent shall enjoy exclusive occupancy of such premises with no right
of access being granted to or retained by the Grantor or its other Affiliates
pursuant to such lease or sublease (other than any such right which is customary
for unaffiliated, third-party landlords to be granted in order to respond to
emergencies, or in order to conduct inspection of the premises upon reasonable
notice to the Collateral Agent and in the presence of the Collateral Agent),
(ii) there shall be no doorway or other physical access to the Collateral Agent
Office directly from premises occupied exclusively by the Grantor or any of its
other Affiliates, (iii) the public entrance to the Collateral Agent Office shall
be accessible from the street, a public lobby or other public space, and
entrance by the public into the Collateral Agent Office shall not require access
to space occupied exclusively by the Grantor or any of its other Affiliates,
(iv) the public entrance to the Collateral Agent Office shall be conspicuously
marked with the name of the Collateral Agent to identify such premises as being
premises of the Collateral Agent, and there
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shall be no reference in such markings to the Grantor or any of its other
Affiliates, (v) the Collateral Agent Office shall be staffed solely by
employees, officers or agents of the Collateral Agent and not of the Grantor or
any of its other Affiliates, which employees, officers and agents will be under
the sole supervision and direction of the Collateral Agent, and (vi) the Grantor
shall have access to the Collateral Agent Office, under the supervision of the
Collateral Agent, during normal business hours, which access shall be not
greater than that afforded to similar Persons in an arm's-length custodial
transaction.
5. COLLATERAL AGENT'S REVIEW OF COLLATERAL; BORROWING BASE CERTIFICATES.
(a) REVIEW OF COLLATERAL. Upon receipt of Required Documents
specified on ATTACHMENT 2 hereto for any Collateral, the Collateral Agent shall
review the same and verify that:
(i) all Required Documents appear regular on their face and
remain in the Collateral Agent's possession; and
(ii) the statements set forth on ATTACHMENT 3 hereto are
accurate and complete in all respects in respect of such Collateral.
Such verification of Collateral delivered during any period covered by a Basic
Status Report referred to in Section 5(d) hereof shall be set forth in such
report. If the Collateral Agent (x) notes any exception in the review described
in subsection (i) or (ii) above, (y) determines that any item of Collateral does
not satisfy the requirements of the Loan Documents for inclusion in the HonoMo
Tranche A Borrowing Base or the HonoMo Tranche B Borrowing Base, or (z)
questions, in its reasonable discretion, the genuineness, regularity, propriety,
or accuracy of any item of Collateral, the Collateral Agent shall note the same
as ineligible Collateral in its next HonoMo Tranche A Borrowing Base Certificate
or HonoMo Tranche B Borrowing Base Certificate, as the case may be, delivered to
the Administrative Agent.
(b) BORROWING BASE DETERMINATION; DETERMINATION ASSUMPTIONS. On each
Business Day, the Collateral Agent shall compute the value of the HonoMo Tranche
A Borrowing Base and the HonoMo Tranche B Borrowing Base (a "Borrowing Base
Determination"). At the close of the last Business Day of each week, the
Collateral Agent shall reconcile the Borrowing Base Determination against the
written determination thereof made by the Grantor (which determination shall be
in form and substance satisfactory to the Administrative Agent). In the event
either the Collateral Agent or Grantor determines that a discrepancy exists, the
Grantor shall cooperate with the Collateral Agent to reconcile such discrepancy
promptly but in any event not later than the following Business Day and prior to
any delivery of a HonoMo Tranche A Borrowing Base Certificate or HonoMo Tranche
B Borrowing Base Certificate to the Administrative Agent. Upon receipt of a copy
of any notice of borrowing and/or notice of payment submitted by the Grantor to
the Collateral Agent, deletion of any Collateral from the HonoMo Tranche A
Borrowing Base or the HonoMo Tranche B Borrowing Base or at such other times as
the Administrative Agent or the Grantor shall reasonably request, the Collateral
Agent shall promptly notify the Administrative Agent, or the Grantor, as the
case
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may be, of its Borrowing Base Determination by delivering a HonoMo Tranche A
Borrowing Base Certificate in the form of ATTACHMENT 4-A hereto and a HonoMo
Tranche B Borrowing Base Certificate in the form of ATTACHMENT 4-B hereto. In
making its Borrowing Base Determination, the Collateral Agent shall also verify
that (i) the aggregate outstanding Principal Amount of all Tranche A Loans and
Tranche A Swing Line Loans does not and, after giving effect to any borrowings
or payments contemplated in any such notice of borrowing or notice of payment or
any such deletion, will not, exceed the HonoMo Tranche A Borrowing Base, (ii)
the HonoMo Tranche A Borrowing Base complies in all respects to the limitations
and other terms set forth in Section 4.1 of the Credit Agreement, (iii) the
aggregate outstanding Principal Amount of all Tranche B Loans and Tranche B
Swing Loans does not and, after giving effect to any borrowings or payments
contemplated in any such notice of borrowing or notice of payment or any such
deletion, will not, exceed the HonoMo Tranche B Borrowing Base, and (iv) the
HonoMo Tranche B Borrowing Base complies in all respects to the limitations and
other terms set forth in Section 4.2 of the Credit Agreement.
(c) In making any Borrowing Base Determination or other calculation
involving a determination of the value of the HonoMo Tranche A Borrowing Base or
the HonoMo Tranche B Borrowing Base, the Collateral Agent shall be permitted to
rely, without independent investigation of the correctness thereof, on:
(i) the information supplied by the Grantor to the
Collateral Agent on the related HonoMo Tranche A Borrowing Base
Addition Report with respect to the unpaid principal balance, the
acquisition cost (minus discount points and fees associated with
yield), and the Applicable Take-Out Price relating to any Mortgage
Loan;
(ii) the information supplied by the Grantor to the
Collateral Agent on the related HonoMo Tranche A Borrowing Base
Addition Report with respect to the Applicable Take-Out Price relating
to any Mortgage-Backed Security;
(iii) the information supplied by the Grantor to the
Collateral Agent on the related HonoMo Tranche B Borrowing Base
Addition Report or Receivables Certificate with respect to the amount
of any Servicing Receivable;
(iv) the information supplied by the Grantor to the
Collateral Agent, whether written or in any other form acceptable to
the Collateral Agent, with respect to a determination as to whether
amounts received in the Mortgage Loan Settlement Account or Securities
Settlement Account represent the purchase price paid for a specific
Mortgage Loan or Mortgage-Backed Security and, consequently, whether
the value of such Mortgage Loan or of such Mortgage-Backed Security
should be removed from such calculation; and
(v) the information supplied by the Grantor to the
Collateral Agent, whether written or in any other form acceptable to
the Collateral Agent, with respect to a determination as to whether
amounts received in the Servicing Settlement Account represent
collections of Servicing Receivables or other Servicing Rights or the
purchase
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price paid for Servicing Receivables or other Servicing Rights sold and,
consequently, whether the value of such Servicing Receivables or Servicing
Rights should be removed from such calculation.
(d) REPORTS. The Collateral Agent shall deliver to: (i) the
Administrative Agent and the Grantor, (A) within three Business Days after the
end of each month, a basic status report in form and substance acceptable to the
Administrative Agent with respect to the status of the HonoMo Tranche A
Borrowing Base and the HonoMo Tranche B Borrowing Base ("Basic Status Report")
as of the end of the preceding month and (B) within one Business Day after the
end of each week, a report in form and substance acceptable to the
Administrative Agent with respect to exceptions noted by the Collateral Agent in
accordance with Section 5(a) hereof outstanding as of the end of the preceding
week (an "Outstanding Exceptions Report"), and (ii) to the Administrative Agent
and the Lenders, from time to time, such other reports and information as the
Administrative Agent or the Required Lenders may from time to time reasonably
request. In preparing any such reports, the Collateral Agent shall be entitled
to rely, without independent investigation (other than the review steps
described on ATTACHMENT 3 hereto), on information supplied to the Collateral
Agent by the Grantor.
6. RELEASE OF COLLATERAL; POOL FORMATION; PLEDGING OF MORTGAGE-BACKED
SECURITIES AND TRANSFER OF FUNDS FROM SETTLEMENT ACCOUNTS.
(a) RELEASE OF MORTGAGE LOANS FOR CORRECTION UNDER TRUST RECEIPT.
Unless and until notified by the Administrative Agent (by telephone,
telefacsimile or otherwise) that a Default or an Event of Default has occurred
and is continuing, the Collateral Agent is hereby authorized upon written
request of the Grantor to release from time to time to the Grantor,
documentation constituting or relating to Mortgage Loans pledged hereunder
against a trust receipt executed by the grantor in the form of ATTACHMENT 5-A
hereto (during a Negative Security Period) or ATTACHMENT 5-B hereto (during a
Positive Security Period), with all blanks completed in conformity therewith. In
any such release, the Grantor and the Collateral Agent will comply with the
relevant trust receipt procedures specified on ATTACHMENT 6 hereto. The Grantor
hereby represents and warrants that (i) any request by the Grantor for release
of documentation constituting or relating to Mortgage Loans shall be solely for
the purposes of correcting clerical or other nonsubstantial documentation
problems in preparation for returning such documentation to the Collateral Agent
for ultimate sale or exchange, and (ii) the Grantor shall request such release
in compliance with all of the terms and conditions of such release herein set
forth. The Grantor agrees to hold any documentation so released in trust for the
Collateral Agent and the other Secured Parties, and agrees to return such
documentation to the Collateral Agent no later than the close of business on the
fourteenth (14th) day following the date of such release or, if such day is not
a Business Day, on the immediately preceding Business Day.
(b) RELEASE OF MORTGAGE LOANS FOR WHOLE-LOAN PURCHASES. Unless and
until otherwise notified by the Administrative Agent (by telephone,
telefacsimile or otherwise) that a Default or an Event of Default has occurred
and is continuing, upon delivery from time to time by the Grantor to the
Collateral Agent of a shipping request and authorization to ship in the form
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of ATTACHMENT 7-A hereto, with all blanks completed in conformity therewith, the
Collateral Agent shall release documentation constituting or relating to
Mortgage Loans pledged hereunder to Approved Investors for purchase as whole,
non-pooled Mortgage Loans. Any transmittal of documentation for Mortgage Loans
in the possession of the Collateral Agent in connection with the sale thereof to
an Approved Investor (other than an Agency) shall be under cover of a
transmittal letter substantially in the form of ATTACHMENT 7-B hereto (during a
Negative Security Period) or ATTACHMENT 7-C hereto (during a Positive Security
Period), with all blanks completed in conformity therewith and duly executed by
the Collateral Agent. Any transmittal of documentation for Mortgage Loans in
connection with the sale thereof to either FHLMC or FNMA for inclusion as whole,
non-pooled Mortgage Loans in their respective loan portfolios shall be (x) under
cover of a transmittal letter substantially in the form of ATTACHMENT 7-B hereto
(during a Negative Security Period) or ATTACHMENT 7-C hereto (during a Positive
Security Period), with all blanks completed in conformity therewith and duly
executed by the Collateral Agent, (y) under cover of such other forms in lieu of
the foregoing that FHLMC or FNMA require pursuant to their respective Agency
Guides, duly executed by the Collateral Agent and, if necessary, the Grantor, or
(z) with appropriate entries into any applicable electronic telecommunications
network utilized by FHLMC or FNMA. In each case of transmittal of documentation
constituting or relating to Mortgage Loans pursuant to this subsection (b), the
Collateral Agent and the Grantor shall instruct the recipient thereof that such
documentation shall be resumed to the Collateral Agent if such Mortgage Loans
are not purchased and the proceeds thereof paid in accordance with subsection
(c) below within forty-five (45) days after such recipient's receipt of such
documentation or, if such forty-fifth day is not a Business Day, on the
immediately preceding Business Day. With respect to transmittal of documentation
constituting or relating to Mortgage Loans, before the Collateral Agent delivers
documentation pursuant to this subsection (b), the Grantor shall have delivered
to the Collateral Agent (or any other applicable Person) such forms, duly
executed by the Grantor, or written notification that the Grantor has made such
appropriate entries into any applicable electronic telecommunications network
utilized by FHLMC or FNMA, as required under the applicable Agency Guides or
Take-Out Commitments to effect delivery to FHLMC, FNMA or any other Approved
Investor of such Mortgage Loans and payment therefor in accordance with the
instructions of the Collateral Agent.
(c) MORTGAGE LOAN SETTLEMENT ACCOUNT. With respect to any purchases
of Mortgage Loans described in subsection (b) hereof, the Collateral Agent and
the Grantor shall instruct each Approved Investor purchasing Mortgage Loans that
all amounts payable on account of the sale of such Mortgage Loans are to be paid
directly by such party to a "no access" account of the Grantor (account no.
304-207276) maintained in the Administrative Agent's name alone at the office of
the Administrative Agent for the benefit of the Grantor (the "Mortgage Loan
Settlement Account"). For all such purchases of Mortgage Loans, the Grantor
shall, upon demand of the Collateral Agent or the Administrative Agent, provide
the Collateral Agent and the Administrative Agent with evidence that the Grantor
has directed such Approved Investors to pay such amounts directly into the
Mortgage Loan Settlement Account. Upon the Administrative Agent's receipt of the
full amount of the purchase price for each Mortgage Loan from an Approved
Investor in accordance with this subsection (c), the security interest created
by this Agreement on the affected Mortgage Loan (but not the Proceeds thereof)
shall be
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automatically released. Unless a Default or an Event of Default shall be
continuing, amounts held from time to time in the Mortgage Loan Settlement
Account may, upon the instructions of the Grantor, be invested in Cash
Equivalents.
(d) SECURITY INTEREST IN MORTGAGE LOAN SETTLEMENT ACCOUNT. Pursuant
to Section 3 hereof, the Grantor has granted to the Collateral Agent, for the
benefit of the Secured Parties, effective during any Negative Security Period, a
security interest in the Mortgage Loan Settlement Account and in any and all
funds, securities, Cash Equivalents and other items at any time held therein as
collateral security for the Secured Obligations. This subsection (d) shall
constitute irrevocable notice to the Collateral Agent that the Mortgage Loan
Settlement Account is a "no access" account to the Grantor. The Collateral Agent
shall hold its security interest in the Mortgage Loan Settlement Account and all
funds at any time held therein for the benefit of the Secured Parties and with
all rights of a secured party under the UCC and other applicable New York law.
In no circumstances shall the Grantor have access to, control of or dominion
over the Mortgage Loan Settlement Account. The Collateral Agent hereby appoints
the Administrative Agent to hold the Mortgage Loan Settlement Account pursuant
to the terms hereof for the benefit of the Secured Parties with all rights of a
secured party under the UCC and other applicable New York law, and the
Administrative Agent hereby accepts such appointment.
(e) RELEASE OF MORTGAGE LOANS FOR POOLING. Unless and until
otherwise notified by the Administrative Agent (by telephone, telefacsimile or
otherwise) that a Default or an Event of Default has occurred and is continuing,
upon delivery from time to time by the Grantor to the Collateral Agent of a
shipping request and authorization to ship in the form of ATTACHMENT 7-A hereto,
with all blanks completed in conformity therewith, the Collateral Agent shall
release documentation constituting or relating to Mortgage Loans in connection
with the formation of a pool of Mortgage Loans supporting Mortgage-Backed
Securities. Any transmittal of documentation for such Mortgage Loans in the
possession of the Collateral Agent shall be to the Certificating Custodian and
shall be (x) under cover of a transmittal letter substantially in the form of
ATTACHMENT 7-D hereto (during a Negative Security Period) or ATTACHMENT 7-E
hereto (during a Positive Security Period), as applicable, with all blanks
completed in conformity therewith and duly executed by the Collateral Agent; (y)
under cover of such other forms in lieu of the foregoing that FHLMC, FNMA or
GNMA require pursuant to their respective Agency Guides, duly executed by the
Collateral Agent and, if necessary, the Grantor; or (z) with entries into any
applicable electronic telecommunications network utilized by FHLMC, FNMA or
GNMA. The Collateral Agent and the Grantor shall, with respect to each Mortgage
Loan for which documentation is transmitted pursuant to this subsection (e),
instruct the Certificating Custodian to (i) return to the Collateral Agent,
within ten (10) days after receiving such documentation, either (A) evidence of
such Mortgage Loan's initial certification for inclusion in a Mortgage Loan pool
if the Certificating Custodian so certifies such Mortgage Loan or (B) all
documentation relating to such Mortgage Loan if the Certificating Custodian does
not so certify such Mortgage Loan, (ii) immediately return all documentation
relating thereto to the Collateral Agent if (A) the Certificating Custodian
initially certifies such Mortgage Loan but subsequently determines that such
Mortgage Loan is not suitable for inclusion in a Mortgage Loan pool supporting a
Mortgage-Backed Security prior to the issuance of such Mortgage-Backed Security
or (B) no Mortgage-Backed Security supported by a pool including such Mortgage
Loan has
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been issued within forty-five (45) days after the Certificating Custodian's
receipt of such documentation, and (iii) segregate and, during each Negative
Security Period, properly identify all such documentation as collateral of the
Secured Parties that secures the Secured Obligations. Before the Collateral
Agent delivers documentation pursuant to this subsection (e), the Grantor shall
have delivered to the Collateral Agent or any other applicable Person such
forms, duly executed by the Grantor, or written notification that the Grantor
has made the appropriate entries into any applicable electronic
telecommunications network utilized by FHLMC, FNMA or GNMA, as required under
the applicable Agency Guides or Take-Out Commitments to effect delivery to the
Certificating Custodian of such Mortgage Loans and payment therefor in
accordance with the instructions of the Collateral Agent. The Grantor further
agrees to (x) enter into such arrangements and agreements with the Collateral
Agent, the Certificating Custodian and each of the Agencies as may be necessary
to facilitate the issuance of Mortgage-Backed Securities under the respective
Mortgage-Backed Securities programs of such Agencies and (y) conform its
procedures relating to the formation of such pools and the delivery of such
forms and certifications required by FHLMC, FNMA and GNMA, as the case may be,
to the established procedures of the Collateral Agent with respect thereto.
(f) RETURN OF MORTGAGE LOANS BY CERTIFICATING CUSTODIAN. If the
Certificating Custodian returns to the Collateral Agent documentation relating
to any Mortgage Loan following the Certificating Custodian's determination that
such Mortgage Loan is not suitable for pooling, the Collateral Agent shall hold
such documentation in accordance with the terms hereof, and, following the
Grantor's request that such Mortgage Loan be included in the HonoMo Tranche A
Borrowing Base for purposes of determining the value thereof pursuant to a
HonoMo Tranche A Borrowing Base Addition Report, shall also include such
Mortgage Loan in the HonoMo Tranche A Borrowing Base if (but only if) such
Mortgage Loan constitutes an Eligible Mortgage Loan.
(g) PTC AND SEG ACCOUNTS. The Collateral Agent shall (i) maintain at
all times in its name with the Participants Trust Company (the "PTC"), or with a
participant of the PTC if the Collateral Agent is not a participant of the PTC,
a "Sea Account" (or an account that shall not at any time be subject to a
security interest in favor of the PTC or anyone benefiting through the PTC),
into which each GNMA Mortgage-Backed Security shall be initially deposited or
credited when issued, and (ii) maintain at all times in its name with a bank
that is a member of the Federal Reserve Bank of New York a securities account
into which each FHLMC Mortgage-Backed Security or FNMA Mortgage-Backed Security
shall be entered when issued. In all circumstances, possession, maintenance and
transfer of Mortgage-Backed Securities in, to and from such accounts shall be
under the sole and exclusive control of the Collateral Agent, and the Grantor
shall have no access to, control of or dominion over such accounts.
(h) MBS CUSTODY ACCOUNT. The Grantor has established and shall at
all times maintain a pledged securities custodial account (account no. [______])
with the Administrative Agent (the "MBS Custody Account") for the purpose of
holding all Mortgage-Backed Securities. The MBS Custody Account shall be a "no
access" account to the Grantor maintained in the Collateral Agent's name for the
benefit of the Grantor. The Collateral Agent shall have exclusive control over
the disposition of all Mortgage-Backed Securities held in the MBS Custody
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Account, and the Grantor shall have no right to transfer, trade or otherwise
direct the disposition of such Mortgage-Backed Securities. Pursuant to Section 3
hereof, the Grantor has granted to the Collateral Agent, for the benefit of the
Secured Parties, a security interest in the MBS Custody Account and in any and
all Mortgage-Backed Securities at any time held therein or credited thereto as
collateral security for the Secured Obligations. This subsection (h) shall
constitute irrevocable notice to the Collateral Agent that the MBS Custody
Account is a "no access" account to the Grantor. The Collateral Agent shall hold
its security interest in the MBS Custody Account and all Mortgage-Backed
Securities at any time held therein or thereto, for the benefit of the Secured
Parties, with all rights of a secured party under the UCC and other applicable
New York or federal law. In no circumstances shall the Grantor have access to,
control of or dominion over the MBS Custody Account.
(i) ISSUANCE OF MORTGAGE-BACKED SECURITIES. The Grantor shall
promptly conform to the Collateral Agent the issuance of each Mortgage-Backed
Security supported by a pool of Mortgage Loans constituting Collateral prior to
such issuance. Upon the issuance of Mortgage-Backed Securities, (A) the security
interest of the Collateral Agent, for the benefit of the Secured Parties, in the
pooled Mortgage Loans supporting such Mortgage-Backed Securities (but not in the
Proceeds thereof) shall cease, (B) for purposes of determining the HonoMo
Tranche A Borrowing Base, such Mortgage Loans shall be removed from the HonoMo
Tranche A Borrowing Base and, upon receipt by the Collateral Agent of a HonoMo
Tranche A Borrowing Base Addition Report in respect thereof, such
Mortgage-Backed Securities shall be deemed submitted for inclusion in the HonoMo
Tranche A Borrowing Base and (C) such Mortgage-Backed Securities and the
Proceeds thereof shall be subject to a security interest in favor of the
Collateral Agent for the benefit of the Secured Parties during any Negative
Security Period. The Collateral Agent and the Grantor shall comply with all
rules and regulations, if any, of the applicable Agency, the PTC, the applicable
Federal Reserve Bank and any applicable Governmental Authority for recognizing,
creating and perfecting security interests in such Mortgage-Backed Securities
and shall, to the extent consistent with such rules and regulations, comply with
the procedures set forth on ATTACHMENT 3 hereto. For Book-Entry Mortgage-Backed
Securities, the Collateral Agent and the Grantor shall cause the applicable
security to be issued in the name of or pledged or transferred to the Collateral
Agent (or a financial intermediary for the Collateral Agent), as bailee for the
Secured Parties, as collateral security for the Secured Obligations, and the
Grantor shall identify the Collateral Agent (or its financial intermediary), for
the benefit of the Secured Parties, as the Person to whom such Mortgage-Backed
Security shall be issued on the forms required by FHLMC, FNMA or GNMA under
their respective Agency Guides or in entries into any electronic
telecommunications network utilized by FHLMC, FNMA or GNMA. The Collateral Agent
shall make such entries with respect to such Mortgage-Backed Securities on its
books and records as necessary to reflect the transfer and pledge of such
securities for the benefit of the Secured Parties. The Collateral Agent shall
also ensure that each of the Administrative Agent, the Grantor, itself and any
other applicable Person receive such confirmation, if any, of the pledge as is
necessary to effect a Perfected Assignment with respect to the pledged security.
All such Mortgage-Backed Securities shall be credited "free" when issued to the
Collateral Agent or a financial intermediary of the Collateral Agent. For
certificated Mortgage-Backed Securities, the Collateral Agent or its bailee
(including, without limitation, the Administrative Agent) shall have received
and be holding in its possession for the
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benefit of the Secured Parties the original Mortgage-Backed Security
certificate, which shall be registered in the name of the Collateral Agent or
accompanied by a duly executed (in blank), undated, transfer power or other
instrument of assignment sufficient to transfer the security to the Collateral
Agent for the benefit of the Secured Parties. Immediately upon demand of the
Collateral Agent, the Grantor shall provide the Collateral Agent and the
Administrative Agent with evidence that the Grantor has taken all steps and
performed all actions necessary to ensure that the Collateral Agent holds, for
the benefit of the Secured Parties, a valid, perfected and first priority
security interest in all Mortgage-Backed Securities.
(j) SECURITIES SETTLEMENT ACCOUNT. Unless the Administrative Agent
has notified the Collateral Agent that a Default or an Event of Default has
occurred and is continuing or until otherwise notified by the Administrative
Agent (by telephone, telefacsimile or otherwise), from time to time the
Collateral Agent shall arrange for the timely transfer of any Mortgage-Backed
Securities to an Approved Investor (including any of the Agencies), or the
nominee thereof, in accordance with the terms of any applicable TakeOut
Commitment. The Grantor agrees to provide the Collateral Agent with written or
electronic designation of such Approved Investors, together with the appropriate
instructions for crediting such Approved Investors' respective accounts. All
deliveries of Mortgage-Backed Securities to such Approved Investors shall be
made only "against payment" by such Approved Investors to the Securities
Settlement Account (as hereinafter defined), in immediately available funds, of
the full purchase price of such Mortgage-Backed Securities, in accordance with
the terms of such Take-Out Commitments. The Grantor shall provide the Collateral
Agent and the Administrative Agent with evidence that it has directed all
Approved Investors or other purchasers to pay the proceeds of Mortgage-Backed
Securities purchases directly to a "no access" account to the Grantor (account
no. 304-207284) maintained in the Administrative Agent's name alone for the
benefit of the Grantor (the "Securities Settlement Account"). The Collateral
Agent shall hold its security interest in the Securities Settlement Account and
all funds at any time held therein for the benefit of the Secured Parties and
with all rights of a secured party under the UCC and other applicable New York
law. In no circumstances shall the Grantor have access to, control of or
dominion over the Securities Settlement Account. The Collateral Agent hereby
appoints the Administrative Agent to hold the Securities Settlement Account
pursuant to the terms hereof for the benefit of the Secured Parties with all
rights of a secured party under the UCC and other applicable New York law, and
the Administrative Agent hereby accepts such appointment. Upon the Collateral
Agent's full receipt of the purchase price of any Mortgage-Backed Security in
accordance with this subsection (j) the security interest created by this
Agreement in the affected Mortgage-Backed Security (but not in the Proceeds
thereof) shall be automatically released. Unless a Default or an Event of
Default shall be continuing, amounts held from time to time in the Securities
Settlement Account may, upon the instructions of the Grantor, be invested in
Cash Equivalents.
(k) RELEASE OF CERTAIN MORTGAGE LOANS RELATING TO ELIGIBLE EARLY
BUYOUT ADVANCE RECEIVABLES IN CONNECTION WITH FORECLOSURE PROCEEDINGS. Unless
and until otherwise notified by the Administrative Agent (by telephone,
telefacsimile or otherwise) that a Default or an Event of Default has occurred
and is continuing, upon delivery from time to time by the Grantor to the
Collateral Agent of a shipping request and authorization to ship in the form of
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ATTACHMENT 7-A hereto, with all blanks completed in conformity therewith, the
Collateral Agent shall release documentation constituting or relating to
Mortgage Loans obtained by the Grantor in connection with an Eligible Early
Buyout Advance Receivable and pledged hereunder to the attorney or title
insurance company that has been requested by the Grantor to commence foreclosure
proceedings in respect of such Mortgage Loans. Any transmittal of documentation
for Mortgage Loans in the possession of the Collateral Agent to such attorney or
title company in connection with such foreclosure proceedings shall be under
cover of a transmittal letter substantially in the form of ATTACHMENT 7-F hereto
(during a Negative Security Period) or ATTACHMENT 7-G hereto (during a Positive
Security Period), with all blanks completed in conformity therewith and duly
executed by the Collateral Agent. In each case of transmittal of documentation
constituting or relating to Mortgage Loans pursuant to this subsection (l), the
Collateral Agent shall instruct the recipient thereof that it shall return to
the Collateral Agent, within 45 days of receipt of such documentation, either
(i) evidence of the completion of the foreclosure proceedings in respect of such
Mortgage Loans or (ii) all documentation relating to such Mortgage Loans if such
foreclosure proceedings have not been completed.
(l) NO COLLATERAL RELEASE DURING DEFAULT OR EVENT OF DEFAULT. If the
Collateral Agent has been notified in writing by the Administrative Agent that a
Default or an Event of Default has occurred and is continuing, the Collateral
Agent shall not, and shall incur no liability to the Grantor or any other Person
for refusing to, release any item of Collateral to the Grantor or any other
Person without the express prior written consent and at the direction of the
Administrative Agent.
(M) SERVICING SETTLEMENT ACCOUNT. With respect to any amounts owed
to the Grantor in respect of Servicing Receivables or other Servicing Rights
(including, without limitation, all Eligible Default-Related Advance
Receivables, Eligible Early Buyout Advance Receivables, Eligible Foreclosure
Advance Receivables, Eligible P&I Advance Receivables, Eligible Paid-in-Full
Buyout Advance Receivables, Eligible T&l Advance Receivables, proceeds of the
sale of Servicing Rights and all termination and other fees payable in respect
of Servicing Rights) other than from a mortgagor in respect of the applicable
Mortgage Loan, if requested by the Administrative Agent, the Collateral Agent
and the Grantor shall instruct any obligor in respect of such Servicing
Receivable or other Servicing Rights that all amounts payable on account of such
Servicing Receivable or other Servicing Rights are to be paid directly by such
party to a "no access" account of the Grantor (account no. 304-207292)
maintained in the Administrative Agent's name alone at the office of the
Administrative Agent for the benefit of the Grantor (the "Servicing Settlement
Account"). The Grantor shall, upon demand of the Collateral Agent or the
Administrative Agent, provide the Collateral Agent and the Administrative Agent
with evidence that the Grantor has directed such obligors to pay such amounts
directly into the Servicing Settlement Account. Unless a Default or an Event of
Default shall be continuing, amounts held from time to time in the Servicing
Settlement Account may, upon the instructions of the Grantor, be invested in
Cash Equivalents. With respect to any amounts owed to the Grantor in respect of
Servicing Receivables or other Servicing Rights as to which the Administrative
has not requested that such instructions be given to such obligors or which are
received by the Grantor contrary to such instructions, the Grantor shall, on the
Business Day of its receipt thereof, deposit any and all such amounts in a
blocked account or
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other "no access" account in the name of the Administrative Agent, which account
shall be designated by, and subject to terms and conditions satisfactory to, the
Collateral Agent and the Administrative Agent. All funds so deposited by the
Grantor in such blocked or other account shall be promptly transferred to the
Servicing Settlement Account.
(n) SECURITY INTEREST IN SERVICING SETTLEMENT ACCOUNT. Pursuant to
Section 3 hereof, the Grantor has granted to the Collateral Agent, for the
benefit of the Secured Parties, effective during any Negative Security Period, a
security interest in the Servicing Settlement Account and each other blocked or
other account of the type contemplated in subsection (m) above, and in any and
all funds, securities, Cash Equivalents and other items at any time held therein
as collateral security for the Obligations. This subsection (n) shall constitute
irrevocable notice to the Collateral Agent that the Servicing Settlement Account
is a "no access" account to the Grantor. The Collateral Agent shall hold its
security interest in the Servicing Settlement Account and all funds at any time
held therein for the benefit of the Secured Parties and with all rights of a
secured party under the UCC and other applicable New York law. In no
circumstances shall the Grantor have access to, control of or dominion over the
Servicing Settlement Account. The Collateral Agent hereby appoints the
Administrative Agent to hold the Servicing Settlement Account pursuant to the
terms hereof for the benefit of the Secured Parties with all rights of a secured
party under the UCC and other applicable New York law, and the Administrative
Agent hereby accepts such appointment.
(o) TRANSFER OF FUNDS FROM SETTLEMENT ACCOUNTS. The Administrative
Agent shall transfer by 3:00 P.M. of each Business Day from one or more
Settlement Accounts to an account of the Administrative Agent or to the accounts
of the Lenders, the lesser of (i) all amounts owing to each of the Secured
Parties pursuant to the terms of the Credit Agreement and each of the other Loan
Documents, and (ii) all immediately available funds on deposit in the Settlement
Accounts. The Administrative Agent shall determine the order of transfers from
the Settlement Accounts, and will apply the funds so transferred in payment of
all such amounts so owing in conformity with the provisions of the Credit
Agreement (whether upon instructions of the Collateral Agent or otherwise).
Except during the continuance of a Default or an Event of Default, after the
transfer of funds described in the first sentence of this subclause (o), on each
Business Day, the Administrative Agent shall (unless otherwise instructed by the
Borrower) transfer all remaining available funds on deposit in the Settlement
Accounts (if any) to the Funding Account.
7. RIGHTS OF THE SECURED PARTIES; LIMITATIONS ON SECURED PARTIES' OBLIGATIONS.
(a) It is expressly agreed by the Grantor that, anything herein to
the contrary notwithstanding, the Grantor shall remain liable to observe and
perform all the conditions, duties and obligations to be observed and performed
by it relating to the Collateral, and the Grantor shall perform all of its
duties and obligations thereunder, all in
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accordance with and pursuant to the terms and provisions relating thereto.
Neither the Collateral Agent nor any other Secured Party shall have any
obligation or liability under any instrument, agreement, contract or other
document by reason of or arising out of this Agreement or the granting of a
security interest in any instrument, agreement, contract or other document to
the Collateral Agent on behalf and for the ratable benefit of the Secured
Parties of a security interest therein or the receipt by the Collateral Agent or
any other Secured Party of any payment relating to any of the foregoing pursuant
hereto, nor shall the Collateral Agent or any other Secured Party be required or
obligated in any manner to perform or fulfill any of the obligations of the
Grantor thereunder, or to make any payment, or to make any inquiry as to the
nature or the sufficiency of any payment received by it or the sufficiency of
any performance by any party thereunder, or to present or file any claim, or to
take any action to collect or enforce any performance or the payment of any
amounts which may have been assigned to it or to which it may be entitled at any
time or times.
(b) Subject to the terms of this Agreement, the Collateral Agent
authorizes the Grantor to collect all sums due or to become due (including,
without limitation, Proceeds) in respect of any Collateral ("Collateral
Payments"), provided that such collection is performed in a prudent and
businesslike manner, and the Collateral Agent may, upon the occurrence and
during the continuance of any Default or Event of Default and without notice,
limit or terminate said authority at any time. If required by the Collateral
Agent at any time during the continuance of any Default or Event of Default, any
Collateral Payments, when first collected by the Grantor shall be promptly
delivered by the Grantor to the Collateral Agent in precisely the form received
(with all necessary indorsements), and until so turned over shall be deemed to
be held in trust by the Grantor for and as the Collateral Agent's property, for
the benefit of the Secured Parties, and shall not be commingled with the
Grantor's other funds or properties. Such Collateral Payments, when so delivered
to the Collateral Agent, shall continue to be collateral security for all of the
Secured Obligations and shall not constitute payment thereof until applied as
hereinafter provided. The Collateral Agent shall upon the request of the
Required Lenders apply all or a part of the funds so delivered to the principal
of and/or interest on any of the Secured Obligations in accordance with the
provisions of Section 17(h) hereof.
(c) The Collateral Agent may at any time, upon the occurrence and
during the continuance of any Default or Event of Default, notify any party that
is or might become obligated to make any Collateral Payment that the Collateral
and the right, title and interest of the Grantor in and under the Collateral
have been assigned to the Collateral Agent, for the benefit of the Secured
Parties, and that any or all of such Collateral Payments shall be made directly
to the Collateral Agent or its designee. Upon the request of the Collateral
Agent, the Grantor will so notify such parties. Upon the occurrence and during
the continuance of a Default or an Event of Default, the Collateral Agent may in
its own name or in the name of others communicate with all such parties to
verify with such parties to the Collateral Agent's satisfaction the existence,
amount and terms of any such obligation in respect of any Collateral Payment.
8. REPRESENTATIONS AND WARRANTIES.
(a) The Grantor hereby represents and warrants to the Secured
Parties as follows:
(i) The Grantor is the sole owner of each item of the
Collateral in which it purports to grant a security interest
hereunder, having good title thereto, free and clear of
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any and all Liens or any other right, title, claim or interest, except
for the security interest granted pursuant to this Agreement.
(ii) No effective security agreement, financing statement,
equivalent security or lien instrument or continuation statement
covering all or any part of the Collateral is on file or of record in
any public office, except such as may have been filed by the Grantor
in favor of the Collateral Agent, for the benefit of the Secured
Parties, pursuant to this Agreement.
(iii) Each Mortgage Loan serviced by or on behalf of FHLMC
or FNMA included in the Eligible Servicing Portfolio is covered by a
FNMA Acknowledgment Agreement or FNMA Acknowledgment Agreement,
respectively, that is in full force and effect.
(iv) Each Approved Non-Agency Mortgage Loan that is included
in the Eligible Servicing Portfolio is covered by an Acknowledgment
Agreement that is in full force and effect.
(v) Except as otherwise provided in Section 28 hereof, all
action necessary to protect and perfect the valid and perfected first
priority security interest in each item of the Collateral has been
duly taken (except to the extent that subsequent delivery of documents
or instruments is permitted herein or in the Credit Agreement in
connection with Eligible Wet Loans).
(vi) The Grantor's principal place of business and the place
where its records concerning the Collateral are kept are set forth on
Schedule I hereto.
(vii) All information heretofore, herein, or hereafter
supplied to the Collateral Agent or any other Secured Party by or on
behalf of the Grantor with respect to the Collateral is accurate and
complete in all material respects.
(viii) No consent of any other Person is required for the
grant of the security interest provided herein by the Grantor in any
of the Collateral, other than consents that have been obtained
(subject to any consents that may relate to Servicing Rights not
covered by an Acknowledgment Agreement), nor will any consent need to
be obtained upon the occurrence of an Event of Default for the Secured
Parties to exercise their rights with respect to any of such
Collateral.
(ix) To the best of the Grantor's knowledge, no Obligor or
other Person responsible or liable for any Collateral Payment has any
defense, set off, claim or counterclaim against the Grantor that can
be asserted against the Collateral Agent or any other Secured Party.
(b) The Collateral Agent hereby represents and warrants to the Grantor
and each of the other Secured Parties as follows:
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(i) The Collateral Agent is a national banking association
duly incorporated, validly existing and in good standing under the
laws of the United States of America.
(ii) The execution, delivery and performance by the
Collateral Agent of this Agreement are within the Collateral Agent's
corporate powers, have been duly authorized by all necessary corporate
action and do not contravene the Collateral Agent's certificate of
incorporation or bylaws, any Requirement of Law or any order or decree
of any court, or any contractual obligation of the Collateral Agent.
(iii) No consent, authorization, approval or other action
by, and no notice to or filing with, any Governmental Authority or any
other Person is required for the due execution, delivery and
performance by the Collateral Agent of this Agreement.
(iv) This Agreement has been duly executed and delivered by
the Collateral Agent and is the legal, valid and binding obligation of
the Collateral Agent, enforceable against the Collateral Agent in
accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency and other similar laws affecting
creditors" rights generally and by general principles of equity.
9. ADDITIONAL REPRESENTATIONS AND WARRANTIES CONCERNING MORTGAGE LOANS.
MORTGAGE-BACKED SECURITIES AND SERVICING RECEIVABLES, ETC,.
By adding any Mortgage Loan or Mortgage-Backed Security to the HonoMo
Tranche A Borrowing Base or any Servicing Receivable to the HonoMo Tranche B
Borrowing Base in accordance with Section 4 of this Agreement, the Grantor shall
be deemed to represent and warrant to the Secured Parties at and as of the date
of such addition that each of the statements set forth with respect to such
Mortgage Loan, Mortgage-Backed Security or Servicing Receivable in the
definition of Eligible First Mortgage Loan, Eligible Second Mortgage Loan,
Eligible Mortgage-Backed Security, Eligible Early Buyout Advance Receivable,
Eligible Default-Related Advance Receivable, Eligible Foreclosure Advance
Receivable, Eligible Paid-in-Full Buyout Advance Receivable, Eligible P&I
Advance Receivable or Eligible T&I Advance Receivable, as the case may be, is
true and correct. If any such statement may be untrue or incorrect in any
respect at any time, then the Grantor shall promptly so notify the
Administrative Agent and the Collateral Agent by telefacsimile, and such
Mortgage Loan, Mortgage-Backed Security or Servicing Receivable shall be deemed
to have no value for purposes of determining the HonoMo Tranche A Borrowing Base
or the HonoMo Tranche B Borrowing Base, as the case may be (whether or not the
Grantor has given such notice).
10. STANDARD OF CARE OF COLLATERAL AGENT; DUTIES; INDEMNIFICATION.
The Collateral Agent is a bailee for hire and shall hold the
Collateral in accordance with customary standards for those engaged as
custodians of commercial documents in similar capacities. Nothing contained
herein or in the Credit Agreement shall be construed to make the Collateral
Agent a trustee or other fiduciary for the Administrative Agent or any other
Secured Party. Notwithstanding anything to the contrary contained herein:
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(a) The provisions of the Credit Agreement, this Agreement and the
annexes, schedules, exhibits and attachments hereto set forth the exclusive
duties of the Collateral Agent and no implied duties or obligations shall be
read into this Agreement against the Collateral Agent. The Collateral Agent
shall not be bound in any way by any agreement or contract other than this
Agreement and the annexes, the exhibits and the attachments hereto and any other
agreement to which it is a party. The Collateral Agent shall not be required to
ascertain or inquire as to the performance or observance of any of the
conditions or agreements to be performed or observed by any other party, except
as specifically provided in this Agreement and the annexes, schedules, exhibits
and attachments hereto. The Collateral Agent disclaims any responsibility for
the validity or accuracy of the recitals to this Agreement and any
representations and warranties contained herein, unless specifically identified
as recitals, representations or warranties of the Collateral Agent.
(b) Throughout the term of this Agreement, the Collateral Agent
shall have no responsibility for ascertaining the value, collectability,
insurability, enforceability, effectiveness or suitability (except as otherwise
provided by the Collateral Review Procedures set forth on ATTACHMENT 3 hereto)
of any Collateral, the title of any party therein, the validity or adequacy of
the security afforded thereby or the validity of this Agreement (except as to
Collateral Agent's authority to enter into this Agreement and to perform its
obligations hereunder).
(c) The Collateral Agent shall not be under any duty to examine or
pass upon the genuineness, validity, or legal sufficiency of any of the
documents constituting part of any Mortgage Loan file, including, without
limitation, whether any document purporting to be an assignment is in recordable
form or whether any Evidence of Notice to Customer and Rescission is in
compliance with Regulation Z or other applicable law, and shall be entitled to
assume that all documents constituting part of such files are genuine and valid
and that they are what they purport to be and that any endorsements or
assignments thereof are genuine and valid. The Collateral Agent may rely upon
and shall be protected in acting in good faith upon any notice, resolution,
request, consent, order, certificate, report, statement or other paper or
document appearing on its face to be genuine and to have been signed or
presented by the proper party or parties or by a person or persons authorized to
act on behalf of the proper party or parties. The Collateral Agent shall not be
liable for any action or omission to act as bailee, except for its own gross
negligence or willful misconduct.
(d) No provision of this Agreement shall require the Collateral
Agent to expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder or in the exercise of any of
its rights or powers, if, in its judgment, it shall believe that repayment of
such funds or adequate indemnity against such risk or liability is not assured
to it.
(e) The Collateral Agent is not responsible for preparing or filing
any reports or returns relating to federal, state or local income taxes with
respect to this Agreement, other than for the Collateral Agent's compensation or
for reimbursement of expenses.
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(f) The Grantor agrees to reimburse, indemnify and hold harmless the
Collateral Agent and its directors, officers, employees, Affiliates and agents
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses (including, without
limitation, reasonable attorneys' fees and disbursements and allocated costs of
internal counsel) or disbursements of any kind or nature that may be imposed on,
incurred by or asserted against the Collateral Agent and its directors,
officers, employees, Affiliates and agents arising from or connected with the
Collateral Agent's execution and performance of this Agreement, including, but
not limited to, the claims of any third parties, including any assignee. The
foregoing shall apply regardless of whether such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements are in any way or to any extent caused, in whole or in part, by
any negligent act or omission of any kind by the Collateral Agent; PROVIDED that
the Grantor shall not be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from gross negligence or willful misconduct
on the part of the Collateral Agent. This provision shall survive the
termination of this Agreement.
(g) At its sole cost and expense, the Collateral Agent shall have
the power to employ such agents as it may deem necessary or appropriate in the
performance of its duties and the exercise of its powers under this Agreement.
11. FEES AND EXPENSES OF COLLATERAL AGENT.
The Collateral Agent shall notify the Grantor of all reasonable fees,
expenses, and charges of the Collateral Agent arising out of the Collateral
Agent's entering into this Agreement and performing its duties and obligations
under this Agreement (including in connection with the enforcement of remedies
hereunder and realization upon the Collateral), and (except as set forth in
Section 10(g) hereof) such fees, expenses and charges shall be paid promptly by
the Grantor or, if already paid by the Collateral Agent, the Grantor shall
reimburse the Collateral Agent promptly therefor. The Collateral Agent shall
receive reasonable additional compensation from the Grantor for services
rendered beyond those specifically enumerated in this Agreement, PROVIDED that
the Collateral Agent shall, to the extent possible, provide reasonable advance
notice to the Grantor of such services and its estimate of fees, expenses and
charges in connection therewith. The Collateral Agent may employ, at the
Grantor's expense, such legal counsel and other experts as it reasonably deems
necessary in connection with entering into this Agreement and performing its
duties and obligations under this Agreement. The Collateral Agent may rely upon
and shall be protected if acting in good faith upon the advice of such legal
counsel or experts.
12. REMOVAL OR RESIGNATION OF COLLATERAL AGENT.
The Administrative Agent, upon the direction of the Required Lenders,
may, at any time, remove and discharge the Collateral Agent from the performance
of its duties under this Agreement, effective (a) immediately if such
termination is for cause or (b) upon not less than thirty (30) days' prior
written notice to the Collateral Agent and the Grantor if such termination is
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without cause. In addition, the Collateral Agent may, at any time, terminate its
agreement to act as the Collateral Agent hereunder, effective upon sixty (60)
days' prior written notice to the Grantor, the Administrative Agent and the
Lenders. Upon the effective date of any such termination, the Collateral Agent
shall promptly deliver the Collateral then held by it and any and all books and
records (or copies thereof) relating thereto, to the Administrative Agent or to
such other person or entity as the Administrative Agent may direct in writing,
and shall cooperate with the Administrative Agent and any successor Collateral
Agent in order to effect the orderly transfer of the Collateral and the rights
and obligations of the Collateral Agent hereunder to any successor Collateral
Agent. Upon resignation or removal of the Collateral Agent hereunder, the
Administrative Agent and the Required Lenders shall appoint a successor
Collateral Agent. If no successor Collateral Agent shall have been so appointed,
and shall have accepted such appointment, before the end of the thirty (30) or
sixty (60) day period referred to above, as the case may be, then the
Administrative Agent (or, at the discretion of the Administrative Agent, an
Affiliate of the Administrative Agent) shall succeed as Collateral Agent.
13. AVAILABILITY OF DOCUMENTS.
The Administrative Agent and each other Secured Party and its agents.
accountants, attorneys and auditors will be permitted during normal business
hours at any time and from time to time upon reasonable notice to the Collateral
Agent to examine and inspect (to the extent permitted by applicable law) the
files, documents, records and other papers in the possession or under the
control of the Collateral Agent relating to any or all of the Collateral and to
make copies thereof. As long as no Default or Event of Default has occurred and
is continuing, any such activity will be at no cost or expense to the Grantor;
if a Default or Event of Default has occurred and is continuing, all costs and
expenses associated with the exercise by the Administrative Agent or any other
Secured Party of its rights under this Section 13 shall be paid by the Grantor
within fifteen (15) days of receipt by the Grantor from the Administrative Agent
or such other Secured Party of a statement setting forth in reasonable detail
the amount thereof.
14. COVENANTS.
The Grantor covenants and agrees with the Collateral Agent and the
other Secured Parties that from and after the date of this Agreement and until
the Secured Obligations are fully satisfied:
(a) FURTHER DOCUMENTATION: PLEDGE OF INSTRUMENTS AND CHATTEL PAPER.
At any time and from time to time, upon the written request of the Collateral
Agent, and at the sole expense of the Grantor, the Grantor will promptly and
duly execute and deliver any and all such further instruments and documents and
take such further action as the Collateral Agent may reasonably deem necessary
or desirable to obtain the full benefits of this Agreement and of the rights and
powers herein granted, including, without limitation, using its best efforts to
secure all consents and approvals necessary or appropriate for the assignment to
the Collateral Agent of any Collateral held by the Grantor or in which the
Grantor has any rights not heretofore assigned, the filing of any financing or
continuation statements under the UCC with respect to the Liens and security
interests granted hereby and transferring Collateral to the Collateral Agent's
(or its
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bailee's) possession (if a security interest in such Collateral can be perfected
by possession). The Grantor also hereby authorizes the Collateral Agent to file
any such financing or continuation statement without the signature of the
Grantor to the extent permitted by applicable law. If any of the Collateral
shall be or become evidenced by any instrument, the Grantor agrees to pledge
such instrument to the Collateral Agent and shall duly endorse such instrument
in a manner satisfactory to the Collateral Agent and deliver the same to the
Collateral Agent. The Grantor shall hold any such instrument in its possession
in trust for the benefit of the Secured Parties until the delivery thereof to
the Collateral Agent as provided herein.
(b) Maintenance of Records. The Grantor will keep and maintain at
its own cost and expense satisfactory and complete records of the Collateral,
including, without limitation, a record of all payments received and all credits
granted with respect to the Collateral and all other dealings with the
Collateral. The Grantor will xxxx its books and records pertaining to the
Collateral to evidence this Agreement and the Lien and security interests
granted hereby. For the Collateral Agent's and the other Secured Parties'
further security, the Grantor agrees that the Collateral Agent and the other
Secured Parties shall have a special property interest in all of the Grantor's
books and records pertaining to the Collateral and, upon the occurrence and
during the continuance of any Default or Event of Default, the Grantor shall
deliver and turn over any such books and records to the Collateral Agent or to
its representatives at any time on demand of the Collateral Agent.
(c) INDEMNIFICATION. In any suit, proceeding or action brought by
the Collateral Agent or any other Secured Party relating to all or any portion
of the Collateral or any Collateral Payment for any sum owing thereunder, or to
enforce any right in respect of the Collateral or any Collateral Payment, the
Grantor will indemnify and save and keep harmless the Collateral Agent and each
of the other Secured Parties from and against all expense, loss or damage
suffered by reason of any defense, set-off, counterclaim, recoupment or
reduction of liability whatsoever of the obligor thereunder, arising out of a
breach by the Grantor of any obligation thereunder or arising out of any other
agreement, indebtedness or liability at any time owing to, or in favor of, such
obligor or its successors from the Grantor, and all such obligations of the
Grantor shall be and remain enforceable against and only against the Grantor and
shall not be enforceable against the Collateral Agent or any other Secured
Party.
(d) COMPLIANCE WITH LAWS. Etc. The Grantor will comply, in all
material respects, with all acts, rules, regulations, orders, decrees and
directions of any Governmental Authority, applicable to the Collateral or any
part thereof or to the operation of the Grantor's business; PROVIDED, HOWEVER,
that the Grantor may contest any act, regulation, order, decree or direction in
any reasonable manner which shall not, in the sole opinion of the Collateral
Agent, adversely affect the Collateral Agent's rights hereunder or adversely
affect the first priority of its Lien on and security interest in the Collateral
for the benefit of the Secured Parties.
(e) PAYMENT OF OBLIGATIONS. The Grantor will pay promptly when due
all taxes, assessments and governmental charges or levies imposed upon the
Collateral or in respect of its income or profits therefrom and all claims of
any kind (including, without limitation, claims for labor, materials and
supplies), except that no such charge need be paid if (i) such
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non-payment does not involve any danger of the sale, forfeiture or loss of any
of the Collateral or any interest therein, and (ii) such charge is adequately
reserved against in accordance with and to the extent required by GAAP.
(f) COMPLIANCE WITH TERMS OF AGREEMENTS, ETC. In all material
respects, the Grantor will comply with and perform with all obligations,
covenants, conditions and other agreements with respect to any of the Collateral
and all other agreements related thereto to which it is a party or by which it
is bound.
(g) LIMITATION ON LIENS ON COLLATERAL. The Grantor will not create,
permit or suffer to exist, and will defend the Collateral against and take such
other action as is necessary to remove, any Lien on the Collateral except the
Liens created under this Agreement and the other Loan Documents, and will defend
the right, title and interest of the Collateral Agent and the other Secured
Parties in and to any of the Grantor's rights in and under the Collateral and in
and to the Proceeds thereof against the claims and demands of all Persons
whomsoever.
(h) LIMITATIONS ON DISPOSITION. The Grantor will not sell, lease,
transfer or otherwise dispose of any of the Collateral, or attempt or contract
to do so, except as permitted by the Credit Agreement, this Agreement or the
other Loan Documents.
(i) FURTHER IDENTIFICATION OF COLLATERAL. The Grantor will, if so
requested by the Collateral Agent, furnish to the Collateral Agent, as often as
the Collateral Agent reasonably requests, statements and schedules further
identifying and describing the Collateral and such other reports in connection
with the Collateral as the Collateral Agent may reasonably request, all in
reasonable detail.
(j) NOTICES. The Grantor will advise the Collateral Agent promptly,
in reasonable detail, (i) of any Lien or claim made or asserted against any of
the Collateral, (ii) of any material change in the composition of the
Collateral, and (iii) of the occurrence of any other event which would have a
material adverse effect on the aggregate value of the Collateral or on the
security interests created hereunder.
(k) RIGHT OF INSPECTION. Upon reasonable notice to the Grantor
(unless a Default or an Event of Default has occurred and is continuing, in
which case no notice is necessary), the Collateral Agent, each of the other
Secured Parties, and their respective agents, accountants, attorneys and
auditors shall at all times have full and free access during normal business
hours to all the files, documents, records and other papers of the Grantor, and
the Collateral Agent, each of the other Secured Parties and their respective
agents, accountants, attorneys and auditors may examine the same, take extracts
therefrom and make photocopies thereof, and the Grantor agrees to render to the
Collateral Agent, at the Grantor's cost and expense, such clerical and other
assistance as may be reasonably requested with regard thereto.
(l) CONTINUOUS PERFECTION. The Grantor will not change its name,
identity or corporate structure in any manner which might make any financing or
continuation statement filed in connection herewith seriously misleading within
the meaning of Section 9402(7) of the
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UCC (or any other then applicable provision of the UCC) unless the Grantor shall
have given the Collateral Agent at least 30 days' prior written notice thereof
and shall have taken all action (or made arrangements to take such action
substantially simultaneously with such change if it is impossible to take such
action in advance) necessary or reasonably requested by the Collateral Agent to
amend such financing statement or continuation statement so that it is not
seriously misleading. The Grantor will not change its principal place of
business or remove its records, each as set forth on Schedule I hereto, unless
it gives the Collateral Agent at least 30 days' prior written notice thereof and
has taken such action as is necessary to cause the security interest of the
Collateral Agent in the Collateral to continue to be perfected.
(m) INSURANCE. The Grantor will keep the Collateral insured against
loss, damage, theft and other risks customarily covered by insurance and such
other risks as the Collateral Agent may reasonably request.
(n) OTHER ACTS. The Grantor will do all acts that a prudent investor
would deem necessary or desirable to maintain, preserve and protect the
Collateral.
(o) DEFENSE OF ACTIONS. The Grantor will appear in and defend, at
the Grantor's sole cost and expense (unless such action or proceeding arises
solely from an act or failure to act by a Secured Party which act or failure to
act is determined to be gross negligence or willful misconduct), any action or
proceeding that may affect its title to or the Secured Parties' interest in the
Collateral.
(p) REPORTS. Within five Business Days after the end of each
calendar month, the Grantor will provide to the Administrative Agent and the
Collateral Agent a report in respect of each type of Eligible Servicing
Receivable, which report shall be set forth (a) except for Eligible P&I advance
Receivables, in loan-level detail (including, without limitation, loan number,
mortgagor name and receivable amount), and (b) with respect to Eligible P&I
Receivables, by investor remittance type, in each case, in form and substance
satisfactory to the Administrative Agent.
15. The Collateral Agent's Appointment as Attorney-in-Fact.
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(a) The Grantor hereby irrevocably constitutes and appoints the
Collateral Agent and any officer or agent thereof, with full power of
substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead of the Grantor and in the name of the
Grantor or in its own name, from time to time in the Collateral Agent's
discretion, for the purpose of carrying out the terms of this Agreement, to take
any and all appropriate action and to execute and deliver any and all documents
and instruments which the Collateral Agent may deem necessary or desirable to
accomplish the purposes of this Agreement and, without limiting the generality
of the foregoing, hereby gives the Collateral Agent the power and right, on
behalf of the Grantor, without notice to or assent by the Grantor to do the
following:
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(i) to ask, demand, collect, receive and give acquittances
and receipts for any and all moneys due and to become due under any
Collateral and, in the name of the Grantor or in its own name or
otherwise, to take possession of and endorse and collect any checks,
drafts, notes, acceptances or other instruments for the payment of
moneys due under any Collateral and to file any claim or to take any
other action or proceeding in any court of law or equity or otherwise
deemed appropriate by the Collateral Agent for the purpose of
collecting any and all such moneys due under any Collateral whenever
payable and to file any claim or to take any other action or
proceeding in any court of law or equity or otherwise deemed
appropriate by the Collateral Agent for the purpose of collecting any
and all such moneys due under any Collateral whenever payable;
(ii) to pay or discharge taxes, Liens, security interests or
other encumbrances levied or placed on or threatened against the
Collateral, to effect any insurance called for by the terms of this
Agreement and to pay all or any part of the premiums therefor and the
costs thereof; and
(iii) (A) to direct any party liable for any Collateral
Payment under any of the Collateral to make any and all Collateral
Payments due and to become due thereunder, directly to the Collateral
Agent or as the Collateral Agent shall direct; (B) to receive payment
of and receipt for any and all moneys, claims and other amounts due
and to become due at any time, in respect of or arising out of any
Collateral; (C) to sign and indorse any invoices, freight or express
bills, bills of lading, storage, trust or warehouse receipts, drafts
against debtors, assignments, verifications and notices in connection
with accounts and other documents constituting or relating to the
Collateral; (D) to commence and prosecute any suits, actions or
proceedings at law or in equity in any court of competent jurisdiction
to collect the Collateral or any part thereof and to enforce any other
right in respect of any Collateral; (E) to defend any suit, action or
proceeding brought against the Grantor with respect to any Collateral;
(F) to settle, compromise or adjust any suit, action or proceeding
described above and, in connection therewith, to give such discharges
or releases as the Collateral Agent may deem appropriate; (G) to
license or, to the extent permitted by an applicable license,
sublicense, whether general, special or otherwise, and whether on an
exclusive or non-exclusive basis, any patent or trademark constituting
Collateral, throughout the world for such term or terms, on such
conditions, and in such manner, as the Collateral Agent shall in its
sole discretion determine; and (H) generally to sell, transfer,
pledge, make any agreement with respect to or otherwise deal with any
of the Collateral as fully and completely as though the Collateral
Agent were the absolute owner thereof for all purposes, and to do, at
the Collateral Agent's option and the Grantor's expense, at any time,
or from time to time, all acts and things which the Collateral Agent
reasonably deems necessary to protect, preserve or realize upon the
Collateral aid the Collateral Agent's and the other Secured Parties'
Lien therein, in order to effect the intent of this Agreement, all as
fully and effectively as the Grantor might do.
(b) The Collateral Agent agrees that, except upon the occurrence and
during the continuance of any Default or Event of Default, it will forbear from
exercising the power of
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attorney or any rights granted to the Collateral Agent pursuant to this Section
15. The Grantor hereby ratifies, to the extent permitted by law, all that any
said attorney shall lawfully do or cause to be done by virtue hereof. The power
of attorney granted pursuant to this Section 15 being coupled with an interest,
shall be irrevocable until the Secured Obligations are indefeasibly paid in
full.
(c) The powers conferred on the Collateral Agent hereunder are
solely to protect the Collateral Agent's and the other Secured Parties'
interests in the Collateral and shall not impose any duty upon it to exercise
any such powers. The Collateral Agent shall be accountable only for amounts that
it actually receives as a result of the exercise of such powers and neither it
nor any of its officers, directors, employees or agents shall be responsible to
the Grantor for any act or failure to act, except for its own gross negligence
or willful misconduct.
(d) The Grantor also authorizes the Collateral Agent, at any time
and from time to time upon the occurrence and during the continuance of a
Default or Event of Default (i) to communicate in its own name with any party to
any contract, instrument, agreement or document constituting Collateral with
regard to the assignment of the right, title and interest of the Grantor therein
and thereunder and other matters relating thereto and (ii) to execute, in
connection with the sale provided for in Section 17 hereof, any indorsements,
assignments or other instruments of conveyance or transfer with respect to the
Collateral.
16. Performance by the Collateral Agent of the Grantor's Obligations.
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If the Grantor fails to perform or comply with any of its agreements
contained herein and the Collateral Agent, as provided for by the terms of this
Agreement, shall itself perform or comply, or otherwise cause performance or
compliance, with such agreement, the reasonable expenses of the Collateral Agent
incurred in connection with such performance or compliance, together with
interest thereon at the highest rate then in effect in respect of the Loans,
shall be payable by the Grantor to the Collateral Agent on demand and shall
constitute Secured Obligations secured hereby.
17. Remedies, Rights Upon an Event of Default.
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(a) If any Event of Default shall occur and be continuing, the
Collateral Agent shall, at the request of the Administrative Agent (acting upon
the direction of the Required Lenders), or may with the consent of the
Administrative Agent (acting upon the direction of the Required Lenders),
exercise in addition to all other rights and remedies granted to it in this
Agreement and in any other instrument or agreement securing, evidencing or
relating to the Secured Obligations, all rights and remedies of a secured party
under the UCC or as otherwise provided by applicable law or in equity. Without
limiting the generality of the foregoing, the Grantor expressly agrees that in
any such event the Collateral Agent, without demand of performance or other
demand, advertisement or notice of any kind (except the notice specified below
of time and place of public or private sale) to or upon the Grantor or any other
Person (all and each of which demands, advertisements and/or notices are hereby
expressly waived to the maximum extent permitted by the UCC and other applicable
law), may forthwith (i) enter onto
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property where any Collateral or books and records relating thereto are located
and take possession thereof with or without judicial process, (ii) prior to the
disposition of any Collateral, prepare such Collateral for disposition in any
manner and to the extent the Administrative Agent or Collateral Agent deems
appropriate, (iii) collect, receive, appropriate and realize upon the
Collateral, or any part thereof, and/or sell, lease, assign, give an option or
options to purchase, or sell or otherwise dispose of and deliver said Collateral
(or contract to do so), or any part thereof, in one or more parcels at public or
private sale or sales, at any exchange or broker's board or any of the
Collateral Agent's offices or elsewhere at such prices as it may deem best, for
cash or on credit or for future delivery without assumption of any credit risk.
The Collateral Agent or any other Secured Party shall have the right upon any
such public sale or sales, and, to the extent permitted by law, upon any such
private sale or sales, to purchase the whole or any part of said Collateral so
sold. Each purchaser at any such sale or other disposition shall hold the
Collateral free from any claim or right of whatever kind, including, without
limitation, any equity or right of redemption of the Grantor, and the Grantor
specifically waives and releases (to the extent permitted by law) all rights of
redemption. stay, or appraisal that it has or may have under any rule of law or
statute now existing or hereafter adopted. The Grantor further agrees, at the
Collateral Agent's request, to assemble the Collateral and make it available to
the Collateral Agent at places which the Collateral Agent shall reasonably
select, whether at the Grantor's premises or elsewhere. The Collateral Agent
shall apply the net proceeds of any such collection, recovery receipt,
appropriation, realization or sale, as provided in Section 17(h) hereof, the
Grantor remaining liable for any deficiency remaining unpaid after such
application, and only after so paying over such net proceeds and after the
payment by the Collateral Agent of any other amount required by any provision of
law, including Section 9-504(1)(c) of the UCC, need the Collateral Agent account
for the surplus, if any, to the Grantor. To the maximum extent permitted by
applicable law, the Grantor waives all claims, damages, and demands against the
Secured Parties arising out of the repossession, retention or sale of the
Collateral. The Grantor agrees that the Collateral Agent need not give more than
ten days' notice of the time and place of any public sale or of the time after
which a private sale may take place and that such notice is reasonable
notification of such matters. The Grantor shall remain liable for any deficiency
if the proceeds of any sale or disposition of the Collateral are insufficient to
pay all amounts to which the Secured Parties are entitled, the Grantor also
being liable for the fees and expenses of any attorneys employed by the
Collateral Agent and the other Secured Parties to collect such deficiency. Upon
the exercise by the Collateral Agent of any remedy hereunder, the Grantor shall
(x) upon request of the Collateral Agent, deliver to the Collateral Agent all
computer software, tapes, records, documents, escrow deposits and other deposits
in its possession or under its control relating to the Collateral, and (y)
cooperate with the Collateral Agent in every respect in effecting such delivery.
(b) In furtherance and not in limitation of the rights of the
Collateral Agent set forth in this Section 17, upon the acceleration of the
maturity of the Loans or other Secured Obligations as provided in the Credit
Agreement, at the request and direction of the Administrative Agent, the
Collateral Agent may, in addition to any other rights it may have, do one or
more of the following, subject to the terms of the relevant Servicing Contract,
Acknowledgment Agreement, Agency Guide or applicable law (it being understood
that if there is any conflict between any such relevant Servicing Contract,
Acknowledgment Agreement,
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Agency Acknowledgment Agreement, Agency Guide or applicable law and this
Agreement, then the terms of such Servicing Contracts, Acknowledgment Agreement,
Agency Acknowledgment Agreement, Agency Guide or applicable law shall prevail):
(i) succeed the Grantor as servicer under any or all of the
Servicing Contracts as absolute assignee thereof and not merely as
security;
(ii) appoint a third party as successor servicer under any
or all of the Servicing Contracts;
(iii) sell to a third party or itself or otherwise transfer
any of the Grantor's right, title. interest or obligations with
respect to the Servicing Contracts, including without limitation the
right to hold and/or place the escrow deposits associated therewith;
or
(iv) require the Grantor, notwithstanding any action taken
by the Collateral Agent under clause (iii), to remain as servicer
under any Servicing Contract for a reasonable period of time, such
period not to exceed 180 days.
Notwithstanding anything herein to the contrary, the Collateral Agent shall have
no obligations as servicer under any Servicing Contracts unless and until the
Collateral Agent has succeeded the Grantor as servicer of such Mortgage Loans
pursuant to this subsection (b).
(c) The Collateral Agent's rights under clauses (i), (ii) and (iii)
of subsection (b) above shall respectively include, without limitation, the
right to succeed the Grantor as servicer, appoint a successor servicer or
transfer any or all of its rights with respect to the Servicing Rights and/or
the Servicing Contracts of the Grantor, or any successor to the Grantor in
bankruptcy or similar proceedings, rejects any Servicing Contracts. As successor
servicer under such clause (i), the Collateral Agent shall notify all interested
Persons thereof and take such further action as it shall deem necessary or
appropriate. Upon the Collateral Agent's (x) succeeding the Grantor as servicer
under such clause (i), (y) appointing a third party as a successor servicer
under any Servicing Contract under such clause (ii), or (z) transferring any of
the Grantor's right, title, interest and obligations under such clause (iii),
the Grantor shall have no further rights under or with respect to the Servicing
Rights (or to such rights, title, interest or obligations in the case of a
transfer under clause (iii)), to any other documents pertaining thereto or to
the related escrow deposits.
(d) Upon the exercise by the Collateral Agent of any remedy set
forth in subsections (b) or (c) above, the Grantor shall:
(i) upon request of the Collateral Agent, deliver to the
Collateral Agent all computer software, tapes, records, documents,
escrow deposits and other deposits in its possession or under its
control relating to the Collateral, and
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(ii) cooperate with the Collateral Agent in every reasonable
respect in effecting the succession of a successor servicer.
(e) If the Collateral Agent or any appointee of the Collateral Agent
succeeds the Grantor as successor servicer under any Servicing Contract, the
Collateral Agent or such appointee, as the case may be, shall only assume those
obligations that a successor servicer under such Servicing Contract is obligated
to assume; PROVIDED that neither the Collateral Agent or its appointee nor any
other Secured Party shall be liable for any failure of the Grantor to perform
its obligations under any Servicing Contract or for any other breach thereof.
Nothing herein contained shall be construed as an assumption by the Collateral
Agent or its appointee or any other Secured Party of any liability of the
Grantor with respect to any of the Collateral, and the Grantor shall be and
remain responsible for all such liabilities.
(f) The Grantor also agrees to pay all reasonable costs and expenses
of the Collateral Agent and each of the other Secured Parties, including,
without limitation, attorneys' fees, incurred in connection with the enforcement
of any of their rights and remedies hereunder.
(g) The Grantor hereby waives presentment, demand, protest or any
notice (to the maximum extent permitted by applicable law) of any kind in
connection with this Agreement or any Collateral.
(h) The Proceeds of any sale, disposition or other realization upon
all or any part of the Collateral shall be distributed by the Collateral Agent
in the following order of priorities:
First, to the payment of the costs and expenses of such
sale, disposition or other realization, including, without limitation,
all expenses of the Collateral Agent and its agents including the fees
and expenses of its counsel, and all expenses, liabilities and
advances made or incurred by the Collateral Agent and the other
Secured Parties in connection therewith or pursuant to Section 7
hereof;
Next, to the Administrative Agent, for distribution by it in
accordance with the terms of the Credit Agreement; and
Finally, after payment in full of all the Secured
Obligations, to the payment to the Grantor, or its successors or
assigns, or to whomsoever may be lawfully entitled to receive the same
as a court of competent jurisdiction may direct.
18. Limitation on the Secured Parties' Duty in Respect of Collateral.
----------------------------------------------------------------
No Secured Party shall have any duty as to any Collateral in its
possession or control or in the possession or control of any agent or nominee of
it or any income thereon or as to the preservation of rights against prior
parties or any other rights pertaining thereto, except that each Secured Party
shall use reasonable care with respect to the Collateral in its possession or
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under its control. Upon request of the Grantor, the Collateral Agent shall
account for any moneys received by it in respect of any foreclosure on or
disposition of the Collateral.
19. Rights with Respect to GNMA; Acknowledgment Agreements.
------------------------------------------------------
(a) Notwithstanding anything contained herein or in any of the other
Loan Documents to the contrary, the Collateral Agent, by executing this
Agreement, and each of the other Secured Parties, by executing the Credit
Agreement, acknowledge that (a) the Grantor is entitled to servicing income with
respect to any GNMA pool of Mortgage Loans only so long as the Grantor is a GNMA
Issuer/Servicer in good standing; (b) upon the Grantor's loss of such good
standing status, the Secured Parties' rights to any such servicing income also
terminate; and (c) the pledge of rights to servicing income with respect to any
GNMA pool of Mortgage Loans hereunder conveys no rights (such as the right to
become a substitute servicer) that are not otherwise specifically provided for
in the applicable GNMA Guide. Notwithstanding anything contained herein or in
the other Loan Documents to the contrary, to the extent that any Acknowledgment
Agreement is executed and delivered by FNMA and such agreement or the FNMA Guide
relating thereto provides that the Grantor may not pledge security interests in
rights relating to servicing income to secure Loans, the proceeds of which Loans
are used for purposes prohibited by such agreement or FNMA Guide, then the
Collateral Agent and the other Secured Parties shall not be deemed to have such
a security interest to the extent such security interest serves as collateral
for such prohibited use; provided that nothing contained herein shall affect the
validity or enforceability of (x) security interests in such rights pledged to
secure Loans whose purposes are not prohibited and (y) the assignment of the
proceeds of such rights to the Secured Parties, and provided further that if at
any time the use of the proceeds of such Loans is no longer prohibited, then
such security interest shall be valid, binding, perfected, enforceable and in
full force and effect.
(b) The security interest created by this Agreement is subject and
subordinate to all rights, powers, and prerogatives of FNMA under and in
connection with (i) the terms and conditions of that certain Acknowledgment
Agreement, with respect to the security interest created hereunder, by and
between FNMA, the Grantor and the Collateral Agent, (ii) the Mortgage Selling
and Servicing Contract and all applicable Pool Purchase Contracts between FNMA
and the Grantor, and (iii) the FNMA Guide, as such Guide is amended from time to
time ((ii) and (iii) collectively, the "FNMA Contract"), which rights, powers,
and prerogatives include, without limitation, the right of FNMA to terminate the
FNMA Contract with or without cause and the right to sell, or have transferred,
the Servicing Rights as therein provided.
(c) The security interest referred to in this Agreement is subject
and subordinate in each and every respect (a) to all rights, powers and
prerogatives of one or more of the following: FHLMC, FNMA, GNMA, or such other
investors that own mortgage loans, or which guaranty payments on securities
based on and backed by pools of mortgage loans, identified herein (the
"Investors"); and (b) to all claims of an Investor arising out of any and all
defaults and outstanding obligations of the debtor to the Investor. Such rights,
powers and prerogatives of the Investors may include, without limitation, one or
more of the following: the right of an Investor to disqualify the Grantor from
participating in a mortgage selling or servicing
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program or a securities guaranty program with such Investor; the right to
terminate contract rights of the Grantor relating to such a mortgage selling or
servicing program or securities guaranty program; and the right to transfer and
sell all or any portion of such contract rights following the termination of
those rights.
20. Notices.
-------
All notices and other communications provided for hereunder shall be
in writing (including telegraphic, telex, telecopy, or cable communication) and
mailed, telegraphed, telexed, telecopied, cabled or delivered by hand, addressed
to any party hereto at the address of such Secured Party specified in the Credit
Agreement, or, as to each party, at such other address as shall be designated by
such party in a written notice to each other party complying as to delivery with
the terms of this Section. All such notices and other communications shall, when
mailed, telegraphed, telexed, telecopied, cabled or delivered, be effective when
deposited in the mails, delivered to the telegraph company, confirmed by telex
answerback, telecopied with confirmation or receipt, delivered to the cable
company, or delivered by hand to the addressee or its Collateral Agent,
respectively.
21. Amendments. Etc.
---------------
No amendment or waiver of any provision of this Agreement nor consent
to any departure by the Grantor therefrom shall in any event be effective unless
the same shall be in writing, signed by the Grantor, the Administrative Agent
(upon the direction of the Required Lenders or all of the Lenders, as required
by the Credit Agreement) and the Collateral Agent. and then any such waiver or
consent shall only be effective in the specific instance and for the specific
purpose for which given.
22. No Waiver: Remedies.
-------------------
(a) No failure on the part of any Secured Party to exercise, and no
delay in exercising any right hereunder shall operate as a waiver thereof: nor
shall any single or partial exercise of any right hereunder preclude any other
or further exercise thereof or the exercise of any other right. The remedies
herein provided are cumulative, may be exercised singly or concurrently, and are
not exclusive of any remedies provided by law or any of the other Loan
Documents.
(b) Failure by any of the Secured Parties at any time or times
hereafter to require strict performance by the Grantor or any other Person of
any of the provisions, warranties, terms or conditions contained in any of the
Loan Documents now or at any time or times hereafter executed by the Grantor or
any such other Person and delivered to any of the Secured Parties shall not
waive, affect or diminish any right of any of the Secured Parties at any time or
times hereafter to demand strict performance thereof, and such right shall not
be deemed to have been modified or waived by any course of conduct or knowledge
of any of the Secured Parties, or any agent, officer or employee of any Secured
Party.
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23. Successors and Assigns.
----------------------
This Agreement and all obligations of the Grantor hereunder shall be
binding upon the successors and assigns of the Grantor, and shall, together with
the rights and remedies of the Collateral Agent hereunder, inure to the benefit
of the Collateral Agent, each of the other Secured Parties, and their respective
successors and assigns. Notwithstanding the foregoing, the Grantor may not
assign or transfer any of its rights or obligations under this Agreement without
the prior written consent of each Lender, the Administrative Agent and the
Collateral Agent.
24. Governing Law.
-------------
THIS AGREEMENT SHALL BE GOVERNED BY, AND BE CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
25. Entire Agreement; Severability.
------------------------------
This Agreement and the other Loan Documents constitute the entire
agreement and understanding between the parties hereto and supersede any and all
prior or contemporaneous agreements and understandings of such Persons, oral or
written, relating to the subject matter hereof and thereof. In addition, there
are no promises, undertakings, representations or warranties by the Collateral
Agent or any other Secured Party relating to the subject matter hereof not
expressly set forth or referred to herein or in the other Loan Documents. All
waivers by the Grantor provided for in this Agreement have been specifically
negotiated by the parties with full cognizance and understanding of their
respective rights. If any of the provisions of this Agreement shall be held
invalid or unenforceable, this Agreement shall be construed as if not containing
such provisions, and the rights and obligations of the parties hereto shall be
construed and enforced accordingly.
26. Waiver of Jury Trial.
--------------------
EACH OF THE GRANTOR, THE ADMINISTRATIVE AGENT AND THE COLLATERAL AGENT
WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO
ENFORCE OR DEFEND ANY RIGHTS OR REMEDIES HEREUNDER, UNDER THE CREDIT AGREEMENT
OR UNDER ANY OF THE OTHER LOAN DOCUMENTS OR ANY OTHER DOCUMENT RELATING TO ANY
OF THE FOREGOING.
27. Further Indemnification.
-----------------------
The Grantor agrees to pay, and to save the Collateral Agent and each
other Secured Party harmless from, any and all liabilities with respect to, or
resulting from any delay in paying, any and all excise, sales or other similar
taxes which may be payable or determined to be payable with respect to any of
the Collateral or in connection with any of the transactions contemplated by
this Agreement.
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28. Release and Reinstatement.
-------------------------
(a) During any Positive Security Period, upon the written request of
the Grantor and subject to the conditions precedent set forth below, the
Collateral Agent shall release the Collateral from the Lien in favor of the
Collateral Agent for the benefit of the Secured Parties hereunder and, as
evidence of such release of Lien, shall execute and deliver to the Grantor (i) a
confirmation of such release in the form of that attached hereto as ATTACHMENT
9, (ii) such UCC termination statements as are necessary to terminate all
existing UCC-I financing statements covering the Collateral filed by the
Collateral Agent on behalf of the Secured Parties and (iii) such notices and
instructions to all appropriate Persons to release such Lien on any
Mortgage-Backed Security, it being expressly acknowledged and agreed by the
Collateral Agent, the Agent and the Grantor that during any Positive Security
Period the Secured Obligations are intended to be and become unsecured
obligations. During the effectiveness of a Positive Security Period, the
Borrower, in lieu of the Collateral Agent, will maintain possession of the
Collateral as set forth herein, and shall utilize a trust receipt in the form of
that attached hereto as ATTACHMENT 5-B and letters in the forms of those
attached hereto as ATTACHMENT 7-C, ATTACHMENT 7-E and ATTACHMENT 7-G in
releasing Collateral to the Grantor and shipping Collateral pursuant hereto in
lieu of the trust receipt form attached hereto as ATTACHMENT 5-A and the letters
attached hereto as ATTACHMENT 7-B, ATTACHMENT 7-D and ATTACHMENT 7-F,
respectively. As conditions precedent to the release of Lien contemplated
hereby:
(i) Immediately prior to and immediately following the
release of Lien contemplated hereby, there shall not exist any Default
or Event of Default;
(ii) There shall exist a Positive Security Period both
immediately prior to and immediately following the release of Lien
contemplated hereby; and
(iii) The Grantor shall have executed and conditionally
delivered to the Collateral Agent new UCC-1 financing statements in
form and substance acceptable to the Collateral Agent accompanied by
the Grantor's irrevocable written authorization for the Collateral
Agent to file such UCC- I financing statements upon the occurrence of
a Negative Security Event.
(b) Nothing contained in this Section 28 shall in any manner or to
any extent affect the obligations of the Grantor hereunder and under the other
Loan Documents, it being expressly acknowledged and agreed by the Grantor that
the release of the Lien contemplated hereby shall not affect the terms and
provisions of the Loan Documents except to the extent that during any Positive
Security Period, the Secured Obligations shall not be secured by the Collateral,
PROVIDED that notwithstanding the other provisions of this Agreement to the
contrary, during the effectiveness of any Positive Security Period, each
document to be delivered to or held by the Collateral Agent shall be delivered
to or held by the Borrower in lieu thereof, and each review and report to be
undertaken or signed by the Collateral Agent shall be undertaken or signed by
the Borrower in lieu thereof.
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(c) If following the Closing Date or the release of the Lien
contemplated by subparagraph (a) above there shall occur a Negative Security
Event:
(i) The Grantor shall automatically be deemed to assign,
convey, mortgage, pledge, hypothecate and transfer to the Collateral
Agent, on behalf and for the ratable benefit of the Secured Parties,
and automatically be deemed to grant to the Collateral Agent, on
behalf and for the ratable benefit of the Secured Parties, a security
interest in, and effective upon the occurrence of such Negative
Security Event hereby does so assign, convey, mortgage, pledge,
hypothecate and transfer to the Collateral Agent, for the ratable
benefit of the Secured Parties, and hereby does so grant a security
interest in, the Collateral, including, without limitation, all
Collateral then in the possession of the Collateral Agent, as
collateral security for the Secured Obligations;
(ii) The Collateral Agent shall no later than five Business
Days following receipt of notification from the Administrative Agent
of such Negative Security Event (A) record the UCC-1 financing
statements previously delivered to it pursuant to subparagraph
(a)(iii) above and (B) commence to utilize the trust receipt in the
form of that attached hereto as ATTACHMENT 5-A and the letters in the
forms of those attached hereto as ATTACHMENT 7-B, ATTACHMENT 7-D and
ATTACHMENT 7-F in releasing Collateral to the Grantor and shipping
Collateral pursuant to this Agreement; and
(iii) The Grantor shall take such other actions and execute
and deliver such additional documents, instruments and agreements as
the Administrative Agent, the Collateral Agent and the Required
Lenders shall reasonably request to obtain for the Secured Parties the
benefit of the Collateral.
(d) The reinstatement of the Lien of the Collateral Agent for the
benefit of the Secured Parties on the Collateral following a Negative Security
Event shall in no manner affect the rights, powers and remedies of the
Collateral Agent or the other Secured Parties otherwise available under the Loan
Documents, including, without limitation, the right to accelerate the Secured
Obligations and to refuse to make further Loans under the Credit Agreement in
the event there exists a Default or an Event of Default.
(e) Upon the written request of the Grantor, so long as no Default
or Event of Default has occurred and is continuing or would result therefrom,
from time to time (but in no event more frequently than once per calendar
quarter) the Collateral Agent shall, at the sole cost and expense of the
Grantor, release Servicing Receivables and any other Servicing Rights arising in
connection with Servicing Contracts with Approved Investors (other than an
Agency) which do not constitute Eligible Servicing Receivables or otherwise
constitute part of the Eligible Servicing Portfolio and which are not included
in the HonoMo Tranche B Borrowing Base from the Lien in favor of the Collateral
Agent for the benefit of the Secured Parties hereunder and, as evidence of such
release of Lien, shall execute and deliver to the Grantor (i) a confirmation of
such release in a form reasonably satisfactory to the Grantor, the Collateral
Agent and the Administrative Agent, and (ii) such UCC amendments as are
necessary to amend all existing UCC-1 financing statements covering the
Servicing Receivables so released.
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(f) Upon the written request of the Grantor, so long as no Default
or Event of Default has occurred and is continuing or would result therefrom,
from time to time (but in no event more frequently than once per calendar
quarter) the Collateral Agent shall, at the sole cost and expense of the
Grantor, release Mortgage Loans constituting Collateral which are not included
in the HonoMo Tranche A Borrowing Base from the Lien in favor of the Collateral
Agent for the benefit of the Secured Parties hereunder and, as evidence of such
release of Lien, shall execute and deliver to the Grantor (i) a confirmation of
such release in a form reasonably satisfactory to the Grantor, the Collateral
Agent and the Administrative Agent, and (ii) such further documents as are
necessary to effect and evidence the release of such Lien on such Mortgage
Loans.
29. Survival of Representations.
---------------------------
All covenants, agreements, representations and warranties made herein
shall survive the making by the Lenders of the Loans and the execution and
delivery to the Administrative Agent for the account of the Lenders of the Notes
regardless of any investigation made by the Collateral Agent or any of the other
Secured Parties and of the Collateral Agent's and the other Secured Parties'
access to any information and shall continue in full force and effect so long as
any Secured Obligation is unpaid or unperformed.
30. Section Titles.
--------------
The Section titles contained in this Agreement are and shall be
without substantive meaning or content of any kind whatsoever and are not a part
of this Agreement.
31. Execution in Counterparts.
-------------------------
This Agreement may be executed in counterparts, each of which when so
executed shall be deemed to be an original and all of which when taken together
shall constitute one and the same agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed and delivered by its duly authorized officer on the
date first above written.
HONOLULU MORTGAGE COMPANY, INC.
By: ______________________________
Name:
Title:
THE CHASE MANHATTAN BANK,
as Administrative Agent
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By:_______________________________
Name:
Title:
THE FIRST NATIONAL BANK
OF BOSTON, as Collateral Agent
By: ______________________________
Name:
Title:
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SCHEDULE I TO SECURITY AND COLLATERAL AGENCY AGREEMENT
LOCATION OF RECORDS AND CERTAIN COLLATERAL
------------------------------------------
Principal Place of Business:
000 Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxx, Xxxxxx 00000
Location of Records:
000 Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxx, Xxxxxx 00000
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List of Attachments
-------------------
Attachment 1-A HonoMo Tranche A Borrowing Base Addition Report (Mortgage
Loans)
Attachment 1-B HonoMo Tranche A Borrowing Base Addition Report
(Mortgage-Backed Securities)
Attachment l-C HonoMo Tranche B Borrowing Base Addition Report (Servicing
Receivables)
Attachment 1-D Receivables Certificate
Attachment 2 Required Documents
Attachment 3 Required Review Procedures
Attachment 4-A HonoMo Tranche A Borrowing Base Certificate
Attachment 4-B HonoMo Tranche B Borrowing Base Certificate
Attachment 5-A Trust Receipt (During Negative Security Period)
Attachment 5-B Trust Receipt (During Positive Security Period)
Attachment 6 Trust Receipt Procedures
Attachment 7-A Shipping Request and Authorization
Attachment 7-B Transmittal Letter (During Negative Security Period)
Attachment 7-C Transmittal Letter (During Positive Security Period)
Attachment 7-D Bailee Letter (Agency Pool Formation During Negative
Security Period)
Attachment 7-E Bailee Letter (Agency Pool Formation During Positive
Security Period)
Attachment 7-F Bailee Letter (Early Buyout Advance Related Receivables During
Negative Security Period)
Attachment 7-G Bailee Letter (Early Buyout Related Advance Related Receivables
During Positive Security Period)
Attachment 8 Additional Required Documents
Attachment 9 Lien Release Acknowledgment
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ATTACHMENT 1-A
--------------
TO SECURITY AGREEMENT
---------------------
[On Letterhead of Grantor]
HONOMO TRANCHE A BORROWING BASE ADDITION REPORT
(Mortgage Loans)
No.___________
------------ --, ----
[Collateral Agent]
[Address]
Ladies and Gentlemen:
Pursuant to the terms of the Amended and Restated Credit Agreement (as
amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), dated as of January 31, 1997, between the Lenders party thereto
from time to time, the Balance Lenders, The Chase Manhattan Bank, as
Administrative Agent (the "Administrative Agent"), The First National Bank of
Boston Association, as Collateral Agent (the "Collateral Agent"), HomeSide
Lending, Inc. and the undersigned, and the Amended and Restated Security and
Collateral Agency Agreement (as amended, supplemented or otherwise modified from
time to time, the "Security Agreement"), dated as of January 31, 1997, among the
Administrative Agent, the undersigned and the Collateral Agent, we hereby add
the Mortgage Loans listed on the schedules attached hereto to the HonoMo Tranche
A Borrowing Base. The capitalized terms used herein but not defined shall have
the respective meanings as set forth in the Credit Agreement or the Security
Agreement.
With respect to each Mortgage Loan listed on the attached Schedule, we
hereby certify that either (i) each of the documents listed on ATTACHMENT 2 to
the Security Agreement that are required to be delivered for Mortgage Loans that
may be included in the HonoMo Tranche A Borrowing Base has been delivered to you
prior to (or is being delivered to you simultaneously with) the delivery of this
report or (ii) in the case of Eligible Wet Loans, each of the documents listed
on ATTACHMENT 2 to the Security Agreement will be delivered to you within 10
days after the date such Eligible Wet Loan is included in the HonoMo Tranche A
Borrowing Base. We also certify that each such Mortgage Loan has closed or is
scheduled to close by the close of business on the next Business Day after the
date hereof. If any such scheduled closing does not take place, we agree to
notify you by 12:00 noon (New York City time) on the Business Day after such
scheduled closing and agree that such Mortgage Loan shall be given no value for
purposes of determining the HonoMo Tranche A Borrowing Base.
We hereby confirm that the Mortgage Loans listed on the attached
schedules are pledged to the Collateral Agent as Collateral under the Security
Agreement for the benefit of the Secured Parties as security for the Secured
Obligations. We acknowledge and agree that the
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inclusion of such Mortgage Loans in the HonoMo Tranche A Borrowing Base
constitutes "new value" as that term is used in Section 9-304(4) of the New York
Uniform Commercial Code.
HONOLULU MORTGAGE COMPANY INC.
By: ___________________________
Name: _______________________
Title: ______________________
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ATTACHMENT l-B
--------------
TO SECURITY AGREEMENT
---------------------
[On Letterhead of Grantor]
HONOMO TRANCHE A BORROWING BASE ADDITION REPORT
(Mortgage-Backed Securities)
No.____________
------------ --, ----
[Collateral Agent]
[Address]
Ladies and Gentlemen:
Pursuant to the terms of the Amended and Restated Credit Agreement (as
amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), dated as of January 31, 1997, between the Lenders party thereto
from time to time, the Balance Lenders, The Chase Manhattan Bank, as
Administrative Agent (the "Administrative Agent"), The First National Bank of
Boston Association, as Collateral Agent (the "Collateral Agent"), HomeSide
Lending, Inc. and the undersigned, and the Amended and Restated Security and
Collateral Agency Agreement (as amended, supplemented or otherwise modified from
time to time, the "Security Agreement"), dated as of January 31, 1997, among the
Administrative Agent, the undersigned and the Collateral Agent, we hereby
confirm the issuance of the Mortgage-Backed Securities listed on the schedule
attached hereto and add such Mortgage-Backed Securities to the HonoMo Tranche A
Borrowing Base. The capitalized terms used herein but not defined shall have the
respective meanings as set forth in the Credit Agreement or the Security
Agreement.
With respect to each Mortgage-Backed Security listed on the attached
schedule, we hereby certify that (a) if such Mortgage-Backed Security is
certificated, it has been (or is simultaneously herewith being) deposited with
you or your designated agent, bailee or custodian, endorsed in blank for
transfer, and (b) if such Mortgage-Backed Security is a Book-Entry
Mortgage-Backed Security, such Mortgage-Backed Security is the subject of a
Perfected Assignment.
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We hereby confirm that the Mortgage-Backed Securities listed on the
attached schedule are pledged to you as Collateral under the Security Agreement
for the benefit of the Secured Parties as security for the Secured Obligations.
HONOLULU MORTGAGE COMPANY, INC.
By: ___________________________
Name: _____________________
Title: ____________________
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ATTACHMENT l-C
TO SECURITY AGREEMENT
[Grantor Letterhead]
HONOMO TRANCHE B BORROWING BASE ADDITION REPORT
-----------------------------------------------
No.______
-------------, ----
[Collateral Agent]
[Address]
Ladies and Gentlemen:
Pursuant to the terms of the Amended and Restated Credit Agreement (as
amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), dated as of January 31, 1997, among the Lenders party thereto from
time to time, the Balance Lenders, The Chase Manhattan Bank as Administrative
Agent, The First National Bank of Boston as Collateral Agent, HomeSide Lending,
Inc. and the undersigned, and the Amended and Restated Security and Collateral
Agency Agreement (as amended, supplemented or otherwise modified from time to
time, the "Security Agreement"), dated as of January 31, 1997, among the
Administrative Agent, the undersigned and the Collateral Agent, we hereby add
the Servicing Receivables listed on the attached schedules hereto to the HonoMo
Tranche B Borrowing Base. The capitalized terms used herein but not defined
shall have the respective meanings as set forth in the Credit Agreement or
Security Agreement.
With respect to each Eligible Early Buyout Advance Receivable,
Eligible Foreclosure Advance Receivable, and/or Eligible Paid-ln-Full Buyout
Receivable listed on the attached Schedule A, we hereby certify that each of the
documents listed on ATTACHMENT 2 of the Security Agreement that is required to
be delivered for such Servicing Receivables that may be included in the HonoMo
Tranche B Borrowing Base has been delivered to you prior to (or is being
delivered to you simultaneously with) the delivery of this report.
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We hereby confirm that the Servicing Receivables listed on the
attached Schedule A are pledged to the Collateral Agent as Collateral under the
Security Agreement for the benefit of the Secured Parties as security for the
Secured Obligations. We acknowledge and agree that the inclusion of such
Servicing Receivables in the HonoMo Tranche B Borrowing Base constitutes "new
value" as that term is used in Section 9-304(4) of the New York Uniform
Commercial Code.
HONOLULU MORTGAGE COMPANY, INC.
By:____________________________
Name:______________________
Title:_____________________
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Schedule A
to HonoMo Tranche B Borrowing Base Addition Report No._____
1. ELIGIBLE EARLY BUYOUT ADVANCE RECEIVABLES
Mortgagor Receivable
Loan No. Name Amount
-------- ---- ------
2. ELIGIBLE PAID-IN-FULL BUYOUT ADVANCE RECEIVABLES
Mortgagor Receivable
Loan No. Name Amount
-------- ---- ------
3. ELIGIBLE FORECLOSURE ADVANCE RECEIVABLES
Mortgagor Receivable
Loan No. Name Amount
-------- ---- ------
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ATTACHMENT x-X
TO SECURITY AGREEMENT
[Grantor Letterhead]
RECEIVABLES CERTIFICATE
-----------------------
No.______
---------------, ----
[Collateral Agent]
[Address]
Ladies and Gentlemen:
Pursuant to the terms of the Amended and Restated Credit Agreement (as
amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), dated as of January 31, 1997, among the Lenders party thereto from
time to time, the Balance Lenders, The Chase Manhattan Bank as Administrative
Agent, The First National Bank of Boston as Collateral Agent, HomeSide Lending,
Inc. and the undersigned, and the Amended and Restated Security and Collateral
Agency Agreement (as amended, supplemented or otherwise modified from time to
time, the "Security Agreement"), dated as of January 31, 1997, among the
Administrative Agent, the undersigned and the Collateral Agent, set forth below
is a true and correct report of the Eligible P&l Advance Receivables, Eligible
T&I Advance Receivables and Eligible Default-Related Advance Receivables
included in the HonoMo Tranche B Borrowing Base on and as of the date hereof.
The capitalized terms used herein but not defined shall have the respective
meanings as set forth in the Credit Agreement or Security Agreement.
We hereby confirm that the Servicing Receivables listed herein are
pledged to the Collateral Agent as Collateral under the Security Agreement for
the benefit of the Secured Parties as security for the Secured Obligations. We
acknowledge and agree that the inclusion of such Servicing Receivables in the
HonoMo Tranche B Borrowing Base constitutes "new value" as that term is used in
Section 9-304(4) of the New York Uniform Commercial Code.
1. ELIGIBLE P&I ADVANCE RECEIVABLES: $[____________]
2. ELIGIBLE T&I ADVANCE RECEIVABLES: $[____________]
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3. ELIGIBLE DEFAULT-RELATED ADVANCE
RECEIVABLES: $[_____________]
TOTAL: $[_____________]
HONOLULU MORTGAGE COMPANY, INC.
By:________________________
Name:___________________
Title:__________________
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ATTACHMENT 2
------------
TO SECURITY AGREEMENT
---------------------
REQUIRED DOCUMENTS
------------------
REQUIRED DOCUMENTS
------------------
FOR MORTGAGE LOANS
------------------
SUBMITTED FOR INCLUSION IN
--------------------------
THE HONOMO TRANCHE A BORROWING BASE
-----------------------------------
1. Original Mortgage Loan note executed in favor of the Grantor (endorsed or
assigned to the Grantor if purchased by the Grantor) and endorsed by the
Grantor in blank.
2. In the case of any Mortgage Loan that is included in the Tranche A
Borrowing Base for a period of 180 days or more, original recorded mortgage
or deed of trust securing the above Mortgage Loan. In lieu of a recorded
document, the Collateral Agent may accept a copy certified by the escrow
company, title insurance company or closing agent to be a true copy of the
original document.
3. In the case of any Mortgage Loan that is included in the Tranche A
Borrowing Base for a period of 180 days or more, original assignment of the
mortgage or deed of trust by the Grantor to the Collateral Agent with
assignee in blank, but otherwise in recordable form.
4. If the Grantor was not the original holder of the mortgage, the original or
a copy (certified by the Grantor and the closing attorney, correspondent,
records office or escrow or title company) of a proper assignment or
assignments of the mortgage or deed of trust from the original holder,
through any subsequent transferees, to the Grantor.
5. With respect to a Mortgage Loan for which a note modification agreement has
been executed, an original of such note modification agreement.
6. If any of the above documents has been executed by a person holding a power
of attorney, an original or photocopy of such power of attorney certified
by the Grantor.
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REQUIRED DOCUMENTS FOR
----------------------
MORTGAGE-BACKED SECURITIES
--------------------------
TO BE INCLUDED IN THE
---------------------
HONOMO TRANCHE A BORROWING BASE
-------------------------------
If such Mortgage-Backed Security is certificated, the certificate has
been deposited with the Collateral Agent or an agent, bailee and custodian of
the Collateral Agent, properly endorsed in blank for transfer or, if such
Mortgage-Backed Security is a Book-Entry Mortgage-Backed Security, evidence that
such Book-Entry Mortgage-Backed Security is the subject of a Perfected
Assignment. As applicable, all documentation required by the applicable Agency
for MORNET and Xxxxxx Net submissions.
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REQUIRED DOCUMENTS FOR ELIGIBLE EARLY BUYOUT
--------------------------------------------
ADVANCE RECEIVABLES, ELIGIBLE FORECLOSURE
-----------------------------------------
ADVANCE RECEIVABLES AND ELIGIBLE PAID IN FULL
---------------------------------------------
BUYOUT ADVANCE RECEIVABLES
--------------------------
A. Eligible Early Buyout Advance Receivables:
-----------------------------------------
1. Original Mortgage Loan note, endorsed or assigned to the Grantor, and
endorsed by the Grantor in blank.
2. Original recorded mortgage or deed of trust securing the above Mortgage
Loan.
3. Original assignment of the mortgage or deed of trust by the Grantor to the
Collateral Agent with assignee in blank, but otherwise in recordable form.
4. The original of a proper assignment or assignments of the mortgage or deed
of trust from the original holder, through any subsequent transferees, to
the Grantor.
5. With respect to a Mortgage Loan for which a note modification agreement has
been executed for the purpose of converting the interest payable on such
Mortgage Loan from an adjustable rate to a fixed rate, an original of such
note modification agreement.
6. If any of the above documents has been executed by a person holding a power
of attorney, an original or photocopy of such power of attorney certified
by the Grantor.
B. Eligible Foreclosure Advance Receivables:
----------------------------------------
1. A copy of a letter from an appropriate attorney or representative of a
title insurance company that the applicable foreclosure sale has been
completed and that the Grantor was the successful bidder in respect
thereof, or, in lieu thereof, such other evidence of the completion of such
foreclosure as the Collateral Agent may request.
2. As soon as available, a copy of, as applicable (a) Form HUD-27011 Part A
(Single Family application For Insurance Benefits), in the case of an
FHA-Insured Mortgage Loan, (b) VA Form 26-1874 (Claim Under Loan
Guarantee), in the case of a VA-Insured Mortgage Loan, or (c) such claim
form or other documentation as is required by the applicable Approved
Investor or applicable private mortgage insurer. In each case, such
documentation shall be completed by the Grantor in compliance with the FNMA
Guide, the FHLMC Guide or other Approved Investor guidelines, as
applicable.
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C. Eligible Paid-in-Full Buyout Advance Receivables:
------------------------------------------------
1. Original Mortgage Loan note, endorsed or assigned to the Grantor, and
endorsed by the Grantor in blank.
2. Original recorded mortgage or deed of trust securing the above Mortgage
Loan.
3. Original assignment of the mortgage or deed of trust by the Grantor to the
Collateral Agent with assignee in blank, but otherwise in recordable form.
4. The original of a proper assignment or assignments of the mortgage or deed
of trust from the original holder, through any subsequent transferees, to
the Grantor.
5. With respect to a Mortgage Loan for which a note modification agreement has
been executed for the purpose of converting the interest payable on such
Mortgage Loan from an adjustable rate to a fixed rate, an original of such
note modification agreement.
6. If any of the above documents has been executed by a person holding a power
of attorney, an original of such power of attorney certified by the
Grantor.
7. Copies of all correspondence to and from the mortgagor in respect of the
related Mortgage Loan evidencing such mortgagor's intention to liquidate
such Mortgage Loan through a payoff, and setting forth the anticipated
closing date thereof.
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ATTACHMENT 3
------------
TO SECURITY AGREEMENT
---------------------
REQUIRED REVIEW PROCEDURES
--------------------------
1. All documents submitted are consistent with the information provided in the
related schedule(s) attached to the HonoMo Tranche A Borrowing Base
Addition Report or HonoMo Tranche B Borrowing Base Addition Report, as the
case may be, as to mortgagor name, face amount, and loan number.
2. The note and mortgage/deed of trust each bears an original signature or
signatures which appear to be those of the person or persons named as the
maker and mortgagor/ trustor, or, in the case of a certified copy of the
mortgage/deed of trust, such copy bears what appears to be a reproduction
of such signature or signatures.
3. Except for (a) the endorsement to the Grantor of the note in the event such
loan was purchased by the Grantor and (b) the endorsement in blank of the
note by the Grantor, neither the note, the mortgage/deed of trust, nor the
assignment(s) of the mortgage deed of trust contain any irregular writings
which appear on their face to affect the validity of any such endorsement
or to restrict the enforceability of the document on which they appear.
4. The note is endorsed in blank.
5. The assignment of the mortgage/deed of trust bears an original signature.
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ATTACHMENT 4-A
--------------
TO SECURITY AGREEMENT
---------------------
FORM OF HONOMO TRANCHE A BORROWING BASE CERTIFICATE
---------------------------------------------------
(See Attached)
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ATTACHMENT 4-B
--------------
TO SECURITY AGREEMENT
---------------------
FORM OF HONOMO TRANCHE B BORROWING BASE CERTIFICATE
---------------------------------------------------
(See Attached)
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ATTACHMENT 5-A
--------------
TO SECURITY AGREEMENT
---------------------
TRUST RECEIPT
-------------
(Release to Grantor During Negative Security Period)
Trust Receipt #______
--------- ---, ----
The undersigned (the "Grantor"), acknowledges receipt from The First
National Bank of Boston, acting as secured party, agent, bailee and custodian
(in such capacity, the "Collateral Agent") for the exclusive benefit of the
Secured Parties (as that term is defined in the Amended and Restated Security
and Collateral Agency Agreement (as amended, supplemented or otherwise modified
from time to time, the "Security Agreement"), dated as of January 31, 1997,
between the Collateral Agent, the Grantor and The Chase Manhattan Bank, as
Administrative Agent, of the following described property (the "Trust
Property"), possession of which is herewith entrusted to the Grantor for the
purposes set forth below:
Mortgage Loan Loan #________ Note Amount: ______ Obligor:_________
Purpose: [Specify nature of clerical or other documentation problem to
be corrected.]
The Grantor hereby acknowledges that a security interest pursuant to
the New York Uniform Commercial Code in the Trust Property and in the proceeds
of the Trust Property has been granted to the Collateral Agent, for the benefit
of the Secured Parties, pursuant to the Security Agreement.
In consideration of the delivery of the Trust Property by the
Collateral Agent to the Grantor, the Grantor hereby agrees to hold the Trust
Property in trust for the Collateral Agent and the Secured Parties as provided
under and in accordance with all provisions of the Security Agreement and to
return the Trust Property to the Collateral Agent no later than the close of
business on the fourteenth (14th) calendar day following the date hereof or, if
such day is not a Business Day, on the immediately preceding Business Day.
The Grantor further agrees that at no time shall the value (determined
in accordance with Section 4.1 of the Credit Agreement) of all Mortgage Loans
(as defined in the Credit Agreement) included in the HonoMo Tranche A Borrowing
Base (as defined in the
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Credit Agreement) with respect to which notes or other documentation has been
released under trust receipts exceed 1% of the Tranche A Commitment Amount (as
defined in the Credit Agreement) then in effect.
HONOLULU MORTGAGE COMPANY, INC.
By:_____________________
Name:___________________
Title:__________________
Delivery to Grantor Acknowledged
THE FIRST NATIONAL BANK OF BOSTON,
as Collateral Agent
By:______________________
Name:____________________
Title:___________________
The undersigned, acknowledges that the above-mentioned Trust Property has been
returned to the Collateral Agent on ______________ __, ____.
THE FIRST NATIONAL BANK OF BOSTON,
as Collateral Agent
By:______________________
Name:____________________
Title:___________________
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ATTACHMENT 5-B
--------------
TO SECURITY AGREEMENT
---------------------
TRUST RECEIPT
(Release to Grantor During Positive Security Period)
Trust Receipt #___
-------- ---, ----
The undersigned (the "Grantor"), acknowledges receipt from The First
National Bank of Boston, acting as agent, bailee and custodian (in such
capacity, the "Collateral Agent") for the exclusive benefit of the Secured
Parties (as that term is defined in the Amended and Restated Security and
Collateral Agency Agreement (as amended, supplemented or otherwise modified from
time to time, the "Security Agreement"), dated as of January 31, 1997, between
the Collateral Agent, the Grantor and The Chase Manhattan Bank, as
Administrative Agent, of the following described property (the "Trust
Property"), possession of which is herewith entrusted to the Grantor for the
purposes set forth below:
Mortgage Loan Loan #_____ Note Amount: ______ Obligor:_____
Purpose: [Specify nature of clerical or other documentation problem to be
corrected.]
In consideration of the delivery of the Trust Property by the
Collateral Agent to the Grantor, the Grantor hereby agrees to hold the Trust
Property in trust for the Collateral Agent and the Secured Parties as provided
under and in accordance with all provisions of the Security Agreement and to
return the Trust Property to the Collateral Agent no later than the close of
business on the fourteenth (14th) calendar day following the date hereof or, if
such day is not a Business Day, on the immediately preceding Business Day.
The Grantor further agrees that at no time shall the value (determined
in accordance with Section 4.1 of the Credit Agreement) of all Mortgage Loans
(as defined in the Credit Agreement) included in the HonoMo Tranche A Borrowing
Base (as defined in the Credit Agreement) with respect to which notes or other
documentation has been released under trust receipts exceed 1% of the Tranche A
Commitment Amount (as defined in the Credit Agreement) then in effect.
HONOLULU MORTGAGE COMPANY. INC.
By:_________________________
Name: ______________________
Title:______________________
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Delivery to Grantor Acknowledged
THE FIRST NATIONAL BANK OF BOSTON,
as Collateral Agent
By: __________________________
Name: ________________________
Title: _______________________
The undersigned, acknowledges that the above-mentioned Trust Property has been
resumed to the Collateral Agent on ___________ ___, ____.
THE FIRST NATIONAL BANK OF BOSTON,
as Collateral Agent
By: __________________________
Name: ________________________
Title: _______________________
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ATTACHMENT 6
------------
TO SECURITY AGREEMENT
---------------------
TRUST RECEIPT PROCEDURES
------------------------
The Grantor and the Collateral Agent will adhere to the following procedures
with respect to trust receipts:
(a) Trust receipts will be prepared by the Grantor. They will be signed by an
Authorized Officer of the Grantor and acknowledged by the Collateral Agent.
Trust receipts will be sequentially numbered by the Collateral Agent, which
will maintain a log with a line for each trust receipt indicating the
sequential number, date issued, Mortgage Loan number, Obligor, note amount
and date Trust Property returned.
(b) The Collateral Agent will maintain all original trust receipts in a drawer
or other depository of a type that is suitable and customary for such
documents controlled solely by the Collateral Agent, with the trust
receipts filed in numerical order.
(c) The Collateral Agent will not release any documentation relating to any
Mortgage Loan included in the HonoMo Tranche A Borrowing Base against a
trust receipt if the value (as determined in accordance with Section 4.1 of
the Credit Agreement) of such Mortgage Loan, when added to the value (as so
determined) of all other such Mortgage Loans included in the HonoMo Tranche
A Borrowing Base then outside the possession of the Collateral Agent under
trust receipts, would exceed 1% of the Tranche A Commitment Amount then in
effect.
(d) Upon return of the Trust Property to the Collateral Agent, the trust
receipt will be surrendered to the Grantor for cancellation.
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ATTACHMENT 7-A
--------------
TO SECURITY AGREEMENT
---------------------
[Grantor Letterhead]
FORM OF SHIPPING REQUEST AND AUTHORIZATION
------------------------------------------
Date: ________________________
[Collateral Agent]
[Address]
Attention: ___________________
This letter is to serve as authorization for you to endorse and ship the
following loans:
Loan Number Mortgagor Name Note Amount
-----------------------------------------------
Commitment #______________ is to be shipped to the following address:
NAME:
ADDRESS:
ATTENTION:
Please endorse the notes as follows:
Please ship the loan documents either by [ ] or by such other courier service as
we have designated to you as "approved." You are not responsible for any delays
in shipment or any other actions or inactions of the courier; HOWEVER, because
the commitment expires on, __________________, ____, we ask that you deliver the
loan documents to the courier no later than _________________________, ____.
Please have the courier xxxx us by using our account #_______________________.
If you should have any questions, or should feel the need for additional
documentation, please do not hesitate to call .
HONOLULU MORTGAGE COMPANY, INC.
By: _________________________
Name: _______________________
Title:_______________________
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ATTACHMENT 7-B
--------------
TO SECURITY AGREEMENT
---------------------
[Collateral Agent Letterhead]
TRANSMITTAL LETTER
------------------
(During Negative Security Period)
[Approved Investor Name]
[Address]
Attn:
Re:Purchase of Mortgage Loans from
Honolulu Mortgage Company. Inc.
-------------------------------
Ladies and Gentlemen:
Attached please find those Mortgage Loans listed separately on the
attached schedule, which Mortgage Loans are owned by Honolulu Mortgage Company,
Inc. (the "Company") and are being delivered to you for purchase.
The Mortgage Loans constitute a portion of the Collateral under (and
as the term "Collateral" and capitalized terms not otherwise defined hereunder
are defined in) the Amended and Restated Security and Collateral Agency
Agreement (as amended, supplemented or otherwise modified from time to time, the
"Agreement"), dated as of January 31, 1997, by and among the Grantor, The Chase
Manhattan Bank, as Administrative Agent, and The First National Bank of Boston,
as Collateral Agent (the "Collateral Agent"). Each of the Mortgage Loans is
subject to a security interest in favor of the Collateral Agent for the benefit
of the Secured Parties, which security interest shall be automatically released
upon our receipt of the full amount of the purchase price of such Mortgage Loans
(as set forth on the schedule attached hereto) by wire transfer to the following
account maintained with the Collateral Agent:
WIRE INSTRUCTIONS TO MORTGAGE LOAN SETTLEMENT ACCOUNT:
[To be provided by the Collateral Agent]
Pending your purchase of each Mortgage Loan and until payment therefor
is received, 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 in trust and as custodian, agent, and bailee for
and on behalf of the Secured Parties. 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 Company. The Mortgage Loan must be so returned
or sales proceeds remitted in
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full no later than forty-five (45) days from the date hereof. 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 HOLD THE MORTGAGE LOANS IN TRUST AND TO BE THE CUSTODIAN,
AGENT, AND BAILEE FOR THE SECURED PARTIES 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: [SPECIFY ADDRESS]; HOWEVER, YOUR
FAILURE TO DO SO DOES NOT NULLIFY SUCH CONSENT.
Sincerely,
THE FIRST NATIONAL BANK OF BOSTON,
as Collateral Agent
By: _____________________________
Name: ___________________________
Title:___________________________
IRREVOCABLY ACKNOWLEDGED AND AGREED TO:
---------------------------------
[Type name of Approved Investor]
By: _____________________________
Name: ___________________________
Title:___________________________
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ATTACHMENT 7-C
--------------
TO SECURITY AGREEMENT
---------------------
[Collateral Agent Letterhead]
TRANSMITTAL LETTER
------------------
(During Positive Security Period)
[Approved Investor Name]
[Address]
Attn:
Re: Purchase of Mortgage Loans from
Honolulu Mortgage Company. Inc.
-------------------------------
Ladies and Gentlemen:
Attached please find those mortgage loans listed separately on the
attached schedule (the "Mortgage Loans"), which Mortgage Loans are owned by
Honolulu Mortgage Company, Inc. (the "Company") and are being delivered to you
for purchase.
Please remit the full amount of the purchase price of such Mortgage
Loans (as set forth on the schedule attached hereto) by wire transfer to the
following account maintained with The Chase Manhattan Bank, as Administrative
Agent:
WIRE INSTRUCTIONS TO MORTGAGE LOAN SETTLEMENT ACCOUNT:
[To be provided by the Collateral Agent]
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
Company. The Mortgage Loan must be so returned or sales proceeds remitted in
full no later than forty-five (45) days from the date hereof. If you are unable
to comply with the above instructions, please so advise the undersigned
immediately.
Sincerely,
THE FIRST NATIONAL BANK OF BOSTON,
as Collateral Agent
By: ____________________________
Name: __________________________
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Title:__________________________
IRREVOCABLY ACKNOWLEDGED AND AGREED TO:
_______________________________________
[Type name of Approved Investor]
By: ____________________________
Name: __________________________
Title:__________________________
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ATTACHMENT 7-D
--------------
TO SECURITY AGREEMENT
---------------------
[Collateral Agent Letterhead]
BAILEE LETTER
-------------
(Agency Pool Formation During Negative Security Period)
[Certificating Custodian]
Re: Honolulu Mortgage Company, Inc.
Shipment of Mortgage Loans for Pool Formation
---------------------------------------------
Attached please find those Mortgage Loans listed separately on the
attached schedule, which are owned by Honolulu Mortgage Company, Inc. (the
"Company") and are being delivered to you, as custodian/trustee (the
"Certificating Custodian"), for certification in connection with the formation
of a Mortgage Loan pool supporting the issuance of a Mortgage-Backed Security
described as follows: _____________________________
The Mortgage Loans constitute a portion of the Collateral under (and
as the term "Collateral" and capitalized terms not otherwise defined hereunder
are defined in) that certain Amended and Restated Security and Collateral Agency
Agreement (as amended, supplemented or otherwise modified from time to time, the
"Agreement"), dated as of January 31, 1997, by and among the Grantor, The Chase
Manhattan Bank, as Administrative Agent, and The First National Bank of Boston,
as Collateral Agent. Each of the Mortgage Loans is subject to a security
interest in favor of the Collateral Agent for the benefit of the Secured Parties
(as such term is defined in the Agreement), which security interest shall be
automatically released upon the issuance of the Mortgage-Backed Security in
accordance with the terms of the prescribed GNMA, FNMA or FHLMC form enclosed
herewith. Upon issuance, the Mortgage-Backed Security shall be subject to a lien
in favor of the Collateral Agent for the benefit of the Secured Parties.
Pending issuance of the Mortgage-Backed Security, the aforesaid
security interest in each Mortgage Loan will remain in full force and effect,
and you shall hold possession thereof and the documentation evidencing such
Mortgage Loans in trust and as custodian, agent and bailee for and on behalf of
the Secured Parties. Please return to the undersigned within ten (10) days after
receiving such documentation, either (A) evidence of each Mortgage Loan's
initial certification for inclusion in a Mortgage Loan pool or (B) all
documentation relating to such Mortgage Loan if such Mortgage Loan is not
initially certified. In addition, please immediately return to the undersigned
all documentation relating thereto to the Collateral Agent if (x) such Mortgage
Loan is initially certified but it is subsequently determined that such Mortgage
Loan is not suitable for inclusion in a Mortgage Loan pool supporting a
Montage-Backed Security prior to the issuance of such Mortgage-Backed Security
or (y) no Mortgage-Backed Security supported by a pool including such Mortgage
Loan has been issued within forty five (45) days of your receipt of such
documentation. In no event shall any Mortgage Loan be returned or proceeds
relating thereto be remitted to the Company. Please segregate and properly
identify all
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such documentation as collateral of the Secured Parties that secures the Secured
Obligations. 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 HOLD THE MORTGAGE LOANS IN TRUST AND TO BE THE CUSTODIAN,
AGENT AND BAILEE FOR THE SECURED PARTIES ON THE TERMS DESCRIBED IN THIS LETTER.
THE COLLATERAL AGENT 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 COLLATERAL AGENT AT THE FOLLOWING ADDRESS: [SPECIFY ADDRESS];
HOWEVER, YOUR FAILURE TO DO SO DOES NOT NULLIFY SUCH CONSENT.
Sincerely,
THE FIRST NATIONAL BANK OF BOSTON,
as Collateral Agent
By: _______________________________
Name: _____________________________
Title:_____________________________
ACKNOWLEDGMENT OF RECEIPT
[Certificating Custodian]
By: _______________________________
Name: _____________________________
Title:_____________________________
Date:
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ATTACHMENT 7-E
--------------
TO SECURITY AGREEMENT
---------------------
[Collateral Agent Letterhead]
BAILEE LETTER
-------------
(Agency Pool Formation During Positive Security Period)
[Certificating Custodian]
Re: Honolulu Mortgage Company, Inc.
Shipment of Mortgage Loans for Pool Formation
---------------------------------------------
Attached please find those mortgage loans listed separately on the
attached schedule (the "Mortgage Loans"), which are owned by Honolulu Mortgage
Company, Inc. (the "Company") and are being delivered to you, as
custodian/trustee (the "Certificating Custodian"), for certification in
connection with the formation of a Mortgage Loan pool supporting the issuance of
a mortgage-backed security (the "Mortgage-Backed Security") described as
follows: _____________________________________.
Please return to the undersigned within ten (10) days after receiving
such documentation, either (A) evidence of each Montage Loan's initial
certification for inclusion in a Mortgage Loan pool or (B) all documentation
relating to such Mortgage Loan if such Mortgage Loan is not initially certified.
In addition, please immediately return to the undersigned all documentation
relating thereto to the Collateral Agent if (x) such Mortgage Loan is initially
certified but it is subsequently determined that such Mortgage Loan is not
suitable for inclusion in a Mortgage Loan pool supporting a
Mortgage-Backed-Security prior to the issuance of such Mortgage-Backed Security
or (y) no Mortgage-Backed Security supported by a pool including such Mortgage
Loan has been issued within forty-five (45) days of your receipt of such
documentation. In no event shall any Mortgage Loan be returned or proceeds
relating thereto be remitted to the Company.
If you are unable to comply with the above instructions, please so
advise the undersigned immediately.
Sincerely,
THE FIRST NATIONAL BANK OF BOSTON,
as Collateral Agent
By: _______________________________
Name:
Title:
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71
ACKNOWLEDGE OF RECEIPT
[Certificating Custodian]
By: _______________________________
Name:
Title:
Date:
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ATTACHMENT 7-F
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TO SECURITY AGREEMENT
---------------------
[Collateral Agent Letterhead]
BAILEE LETTER
-------------
(Eligible Early Buyout Advance Receivables
During Negative Security Period)
[Name of Attorney or Title Company]
Re: Honolulu Mortgage Company, Inc.
Shipment of Mortgage Loans for Foreclosure Proceedings
Attached please find those Mortgage Loans listed separately on the
attached schedule, which are owned by Honolulu Mortgage Company, Inc. (the
"Company") and are being delivered to you, as agent and bailee (the "Bailee"),
in connection with a request by the Company to the Bailee to commence
foreclosure proceedings.
The Mortgage Loans constitute a portion of the Collateral under (and
as the term "Collateral" and capitalized terms not otherwise defined hereunder
are defined in) that certain Amended and Restated Security and Collateral Agency
Agreement (as amended, supplemented or otherwise modified from time to time, the
"Agreement"), dated as of January 31, 1997, by and among the Grantor, The Chase
Manhattan Bank, as Administrative Agent, and The First National Bank of Boston,
as Collateral Agent. Each of the Mortgage Loans is subject to a security
interest in favor of the Collateral Agent for the benefit of the Secured
Parties, which security interest shall be automatically released upon the
consummation of the foreclosure sale. Upon such sale, the proceeds thereof shall
be subject to a lien in favor of the Collateral Agent for the benefit of the
Secured Parties.
Pending receipt of such proceeds, the aforesaid security interest in
each Mortgage Loan will remain in full force and effect, and you shall hold
possession thereof and the documentation evidencing such Mortgage Loans in trust
and as custodian, agent and bailee for and on behalf of the Secured Parties.
Please return to the undersigned within 45 days after receiving such
documentation, either (A) evidence of the completion of the foreclosure
proceedings in respect of such Mortgage Loan or (B) all documentation relating
to such Mortgage Loan if such foreclosure proceedings have not been completed.
In no event shall any Mortgage Loan be returned or proceeds relating thereto be
remitted to the Company. Please segregate and properly identify all such
documentation as collateral of the Secured Parties that secures the Secured
Obligations. 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 HOLD THE MORTGAGE LOANS IN TRUST AND TO BE THE CUSTODIAN,
AGENT AND BAILEE FOR THE SECURED PARTIES ON
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THE TERMS DESCRIBED IN THIS LETTER. THE COLLATERAL AGENT 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 COLLATERAL AGENT AT THE
FOLLOWING ADDRESS: [SPECIFY ADDRESS]; HOWEVER, YOUR FAILURE TO DO SO DOES NOT
NULLIFY SUCH CONSENT.
Sincerely,
THE FIRST NATIONAL BANK OF BOSTON,
as Collateral Agent
By:______________________________
Name:
Title:
ACKNOWLEDGMENT OF RECEIPT
[Attorney or Title Company]
By:_______________________________
Name:
Title:
Date:
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ATTACHMENT 7-G
--------------
TO SECURITY AGREEMENT
---------------------
[Collateral Agent Letterhead]
BAILEE LETTER
-------------
(Eligible Early Buyout Advance Receivable
During Positive Security Period)
[Name of Attorney or Title Company]
Re: Honolulu Mortgage Company, Inc.
Shipment of Mortgage Loans for Foreclosure Proceedings
------------------------------------------------------
Attached please find those mortgage loans listed separately on the
attached schedule (the "Mortgage Loans"), which are owned by Honolulu Mortgage
Company, Inc. (the "Company") and are being delivered to you, as agent and
bailee (the "Bailee"), in connection with a request by the Company to the Bailee
to commence foreclosure proceedings.
Please return to the undersigned within 45 days after receiving such
documentation, either (A) evidence of the completion of the foreclosure
proceedings in respect of such Mortgage Loan or (B) all documentation relating
to such Mortgage Loan if such foreclosure proceedings have not been completed.
In no event shall any Mortgage Loan be returned or proceeds relating thereto be
remitted to the Company. If you are unable to comply with the above
instructions, please so advise the undersigned immediately.
Sincerely,
THE FIRST NATIONAL BANK OF BOSTON,
as Collateral Agent
By:_________________________
Name:
Title:
ACKNOWLEDGMENT OF RECEIPT
[Attorney or Title Company]
By:__________________________
Name:
Title:
Date:
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ATTACHMENT 8
------------
TO SECURITY AGREEMENT
---------------------
ADDITIONAL REQUIRED DOCUMENTS
-----------------------------
1. The original mortgage or deed of trust securing the Mortgage Loan.
2. A copy of the title insurance policy (or a binding commitment of the title
company therefor) covering at least the face amount of the Mortgage Loan
note, with the original policy of title insurance insuring the mortgage or
deed of trust as a first or second lien, as applicable, on the related
Property written by a title company and containing exceptions acceptable to
an Agency or other Approved Investor.
3. If in the Grantor's possession, evidence of the applicable FHA commitment
for insurance with respect to each FHA-insured Mortgage Loan note, or VA
commitment for guaranty with respect to each VA-guaranteed Mortgage Loan
note, and of the applicable commitment for private Mortgage Loan insurance
with respect to each conventional Mortgage Loan note having a Loan-to-Value
Ratio in excess of 80%.
4. A copy of the executed Take-Out Commitment for each Mortgage Loan, if
applicable.
5. Evidence of fire and extended coverage insurance in an amount not less than
the lower of the following: (a) the amount of the Mortgage Loan and (b)
100% of the insurable value of the improvements. Such insurance shall be
written by a company satisfactory to each Agency or other Approved
Investor.
6. Evidence of Notice to Customer and Rescission required by the federal
Truth-in Lending Law and Federal Reserve Regulation Z.
7. A copy of any required appraisal of the Property.
8. Other documentation (including information contained in electronic,
microfilm or other medium) in the possession of the Grantor as the
Administrative Agent or the Collateral Agent may reasonably deem
appropriate, including, without limitation, such documentation necessary to
fulfill requirements of Take-Out Commitments.
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ATTACHMENT 9
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TO SECURITY AGREEMENT
---------------------
CONFIRMATION OF RELEASE OF LIEN
The undersigned, HONOLULU MORTGAGE COMPANY, INC. (the "Company"),
pursuant to Section 28 of that certain Amended and Restated Security and
Collateral Agency Agreement dated as of January 31, 1997, by and among the
Company, THE FIRST NATIONAL BANK OF BOSTON, as Collateral Agent, and THE CHASE
MANHATTAN BANK, as Administrative Agent (the "Security Agreement," and with
capitalized terms not otherwise defined herein used with the meanings given such
terms in the Security Agreement), hereby requests the Collateral Agent to
execute and deliver to the Company this Confirmation of Release of Lien. To
induce the Collateral Agent to so execute and deliver this Confirmation of
Release of Lien, the Company hereby represents and warrants to each of the
Secured Parties that all conditions precedent to the release of Lien set forth
in Section 28(a) of the Security Agreement have been and following the execution
by the Collateral Agent of this Confirmation of Release of Lien will be
satisfied.
DATED: ___________________________________, ____.
HONOLULU MORTGAGE COMPANY, INC.
By: __________________________
Name: ________________________
Title: _______________________
RELEASE OF LIEN CONFIRMED
this __ day of ____________________, 199_:
THE FIRST NATIONAL BANK OF BOSTON,
as Collateral Agent
By: _______________________________
Name: _____________________________
Title: ______________________________
