EXHIBIT 10.8
* CONFIDENTIAL PORTIONS OF THIS AGREEMENT HAVE BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT
SUB-SERVICING AGREEMENT
between
GREAT LAKES CAPITAL ACCEPTANCE, LLC,
GREAT LAKES FUNDING I, LLC,
and
WENDOVER FINANCIAL SERVICES CORPORATION
Dated as of May 10, 2003
SUB-SERVICING AGREEMENT
THIS SUB-SERVICING AGREEMENT (the "Agreement"), dated as of May 10, 2003 (the
"Effective Date"), is between Great Lakes Capital Acceptance, LLC, an Illinois
limited liability company ("GLCA"), and Great Lakes Funding I, LLC, an Illinois
limited liability company ("GLF")(GLCA and GLF are hereafter collectively
referred to as the "Client"), and Wendover Financial Services Corporation, a
North Carolina corporation ("Wendover").
PRELIMINARY STATEMENTS
Whereas, Client owns the rights to service certain Mortgage Loans; and
Whereas, Wendover is engaged in the business of sub-servicing Mortgage Loans;
and
Whereas, Client desires to engage Wendover to perform certain sub-servicing
functions regarding the Mortgage Loans, as set forth herein.
Now, therefore, in consideration of the mutual covenants herein contained and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Client and Wendover agree as follows:
ARTICLE I. SCOPE, TERM & DEFINITIONS
1.1 Scope. This Agreement documents the terms and conditions under which
Wendover agrees to perform mortgage loan sub-servicing on behalf of
Client, and the terms and conditions under which Client agrees to
purchase such services from Wendover.
1.2 Term; Renewal The term of this Agreement will commence as of the
Effective Date and, unless earlier terminated in accordance with the
terms set forth in Article VII hereof, will remain in full force and
effect through July 31, 2008. This Agreement may be extended upon the
mutual written agreement of the parties.
1.3 Definitions. All capitalized words and phrases used in this Agreement,
unless the context otherwise requires, will have the meanings set forth
in Exhibit A.
ARTICLE II. DESCRIPTION OF SERVICES
2.1 The Services, Generally. Client hereby engages Wendover to perform, and
Wendover agrees to perform, the Services described herein in accordance
with the (i) Roles and Responsibilities Matrix set forth on Exhibit B
hereof, (ii) other Applicable Requirements, and (iii) terms and
conditions of this Agreement; provided, however, that when Applicable
Requirements conflict with the terms of this Agreement, the terms of
this Agreement will control.
CONFIDENTIAL Sub-Servicing Agreement 1
2.2 Delivery and Possession of Servicing Files.
(a) Wendover will begin to sub-service those Mortgage Loans
identified on the Mortgage Loan Schedule as of the initial
Transfer Date, with the understanding that on or before the
Transfer Date for each Mortgage Loan, Client will deliver, at
Client's expense, the Servicing Files and Mortgage Records to
Wendover's designated facility. Wendover will retain copies of
such Servicing Files and Mortgage Records for the sole purpose
of sub-servicing the related Mortgage Loans. Additional hard
copy documents created or obtained by Wendover in connection
with a Mortgage Loan may also be maintained in the Servicing
File.
(b) It is the intent of the parties that Wendover perform the
Services with respect to all mortgage loans for which Client
acquires servicing rights after the Effective Date and, to that
end, Client will offer Wendover the opportunity to provide the
Services with respect to such mortgage loans. If Wendover
accepts such opportunity, the parties will amend the Mortgage
Loan Schedule accordingly, and Client will provide such
information regarding the additional Mortgage Loans as Wendover
may request. Within thirty (30) days following the receipt of
such request and information, Wendover will provide Client with
written notice of any required amendments to the fees or other
terms of this Agreement and, if acceptable to Client, the
parties will agree upon such changes in writing, in accordance
with the procedures set forth in Section 2.14 hereof.
Notwithstanding anything in this Agreement to the contrary, in
the event Wendover is required to report to GNMA under Client's
assigned "Seller/Servicer" number, then Wendover will provide
Services with respect to all Mortgage Loans to be reported under
such number.
(c) Client will be solely responsible for advising any Custodian of
each Transfer Date and will direct the Custodian to deliver to
Wendover, at Client's expense, any documents as are necessary
for Wendover to perform its duties under this Agreement. It is
expressly understood and agreed that Client, or Client's
Custodian, will have sole responsibility for the maintenance
and/or retention of original copies of all Mortgage Loan-related
documents.
(d) If Wendover receives Mortgage Records electronically, it may
rely solely on the information received electronically and will
have no responsibility to compare the information received
electronically to the information in the Servicing Files;
provided, however, if in the course of performing services
hereunder, Wendover detects inconsistencies between information
received electronically and information received on hard copy
documents, Client hereby authorizes Wendover to revise the
electronic files accordingly, and agrees that Wendover will have
no liability therefor.
CONFIDENTIAL Sub-Servicing Agreement 2
2.3 Representatives; Delegation of Authority; Consents; Cooperation.
(a) In order to facilitate effective communication and to achieve
order and accountability in the performance of the parties'
respective obligations under this Agreement, each party will
designate in writing a single person (the "Client
Representative" or the "Wendover Representative", as
appropriate), who will have the obligation and authority to make
timely and binding decisions relating to that party's rights,
duties and obligations hereunder. Each party may change its
designated Representative from time to time upon written notice
to the other party. Client hereby designates Xxxxxxx Xxxxxxx as
the Client Representative and Wendover designates
Xxxxxxx X. Xxxxxx as the Wendover Representative.
(b) Except as specifically set forth herein, Wendover will have full
power and authority, acting alone and as an independent
contractor, to do any and all things necessary to perform the
Services that Wendover may deem necessary or desirable. Without
limiting the generality of the foregoing, Wendover is hereby
authorized and empowered to execute and deliver, on behalf of
Client, all instruments of satisfaction, cancellation, partial
or full release or discharge and all other comparable
instruments with respect to the Mortgage Loans and the Mortgaged
Properties. In addition, Wendover is hereby authorized to
endorse checks made out to Client and to deposit same into the
appropriate custodial account. Upon Wendover's reasonable
request, Client will furnish Wendover with such limited powers
of attorney and other documents necessary or appropriate to
enable Wendover to carry out its duties under this Agreement.
Nothing in this Agreement will impose responsibility or
liability on Wendover for any underwriting functions regarding
any Mortgage Loan.
(c) Wendover may from time to time provide to the Client
Representative, for Client's consent, a written description of a
course of action that Wendover proposes to take under this
Agreement, notwithstanding that Client's consent may not be
required with respect thereto. Unless the Client Representative
gives written notice to Wendover that Client objects to any
recommended course of action within five (5) days of receipt of
Wendover's recommendation, Client will be deemed to have
consented to, and Wendover may take, such recommended course of
action. If the Client Representative objects in writing to
Wendover's recommended course of action within five (5) days of
receipt of Wendover's recommendation, Wendover will not take its
recommended course of action and will take such mutually
agreeable action as may be recommended in writing by the Client
Representative.
(d) Client will use its commercially reasonable efforts to cooperate
with and assist Wendover in Wendover's performance of its
obligations hereunder, and will promptly execute and deliver all
instruments, agreements or documents, and take or cause to be
taken such other action as may be necessary or appropriate in
furtherance thereof.
CONFIDENTIAL Sub-Servicing Agreement 3
2.4 P&I Custodial Account.
(a) Wendover will hold payments of principal and interest on the
Mortgage Loans separate from its own funds and deposit same in
the P&I Custodial Account. Wendover acknowledges and agrees that
the P&I Custodial Account shall be subject to the Blocked
Account Control Agreement.
(b) Wendover will (i) select the depository institution in which the
P&I Custodial Account is maintained, (ii) receive all benefits
to be derived from the P&I Custodial Account, including interest
earned, and (iii) be responsible for all bank charges incurred
on such account. Wendover will be entitled to retain for its own
benefit and will not deposit in the P&I Custodial Account any
ancillary income from the Mortgage Loans, including late payment
fees, returned check fees, assumption fees and satisfaction
fees.
(c) Wendover may, from time to time, withdraw funds from the P&I
Custodial Account in accordance with the terms of this
Agreement.
2.5 INTENTIONALLY OMITTED.
2.6 Hazard Insurance. Wendover will cause to be maintained for each Mortgage
Loan such fire, flood and hazard insurance as required by Applicable
Requirements; provided, however, notwithstanding the foregoing, the
provisions of the Mortgage Note and Mortgage will govern. The mortgagee
clause will be reflected as running to the benefit of Client, its
successor and assigns, as follows: "Client, its successors and assigns,
c/o Wendover Financial Services Corporation", at such address as
Wendover will designate in writing from time to time. Any amounts
collected by Wendover under any such policies will be paid over or
applied by Wendover in accordance with Applicable Requirements whether
for the restoration or repair of the Mortgaged Property, or applied to
reduce the Mortgage Loan. Wendover will not interfere with the
Mortgagor's freedom of choice in selecting either an insurance carrier
or agent upon any policy renewal; provided, however, that upon any such
policy renewal, Wendover will accept insurance policies only from
insurance companies that meet the written requirements of Xxxxxx Xxx.
Wendover will not be required to maintain the original insurance policy
for any Mortgaged Property; provided, however, that in the event that
Wendover is required to do so by Applicable Requirements, Wendover will
obtain and maintain such insurance policies covering the greater of (i)
the last known coverage paid for by Mortgagor, or (ii) the unpaid
principal balance of the Mortgage Note. If Wendover is unable to collect
from the Mortgagor the cost of such policies, Client will pay Wendover
such amounts in accordance with Article IV hereof. Notwithstanding
anything in this Agreement to the contrary, Wendover may at any time and
from time to time solicit Mortgagors for accident, health, life,
property or casualty insurance and other miscellaneous services (with
the exception of refinancing), and any fees payable by any insurer will
be the exclusive property of Wendover.
CONFIDENTIAL Sub-Servicing Agreement 4
2.7 Inspections. Upon Wendover's receipt of actual notice that a Mortgaged
Property is vacant or abandoned, and if required by the Roles and
Responsibilities Matrix, Wendover will arrange for inspections of such
Mortgaged Property (i) regarding any Mortgage Loan that is more than
sixty (60) days delinquent in the payment of any obligations, and (ii)
at such other times and in a manner consistent with Applicable
Requirements. Wendover will use reasonable efforts to secure such
Mortgaged Property, and attempt to recover from the Mortgagor the
expenses associated therewith, provided, however that Client remains
liable for such expenses and if Wendover is unable to recover such
expenses from the Mortgagor, Client will pay Wendover such amounts in
accordance with Article IV hereof.
2.8 Satisfaction of Mortgages. Upon the payment in full of any Mortgage
Loan, or the receipt by Wendover of a notification that payment in full
will be escrowed in a manner customary for such purposes, Wendover will
prepare and process any required satisfaction or release of the
Mortgage. Wendover will attempt to collect from the Mortgagor all
expenses incurred in connection with any instrument of satisfaction or
deed of reconveyance, said costs to be within industry standards. If
Wendover is unable to recover such expenses from the Mortgagor, Client
will pay Wendover such amounts in accordance with Article IV hereof.
2.9 Assumption Agreements. To the extent it has knowledge and is required by
Applicable Requirements to do so, Wendover will notify the Client of the
sale or pending sale of a Mortgaged Property whether by absolute
conveyance or by contract of sale, and whether or not the Mortgagor
remains liable on the Mortgage and the Mortgage Note. Without assuming
responsibility or liability for underwriting decisions whatsoever,
Wendover will follow Applicable Requirements regarding an assumption;
provided, however, that Wendover will not exercise rights of
acceleration if prohibited by law from doing so or if the exercise of
such rights would impair or threaten to impair any recovery under any
FHA insurance or VA guaranty. For purposes of this Section 2.9, the term
"assumption" is deemed to also include a sale of the Mortgaged Property
subject to the Mortgage that is not accompanied by an assumption or
substitution of liability agreement.
2.10 INTENTIONALLY OMITTED.
2.11 INTENTIONALLY OMITTED.
2.12 Distributions; Advances.
(a) Upon Wendover's receipt of payments on the Mortgage Loans,
Wendover will, subject to Section 4.1 hereof, remit same to
Client in accordance with the remittance instructions set forth
in Applicable Requirements or other written instructions
mutually agreed upon by Wendover and Client.
(b) The parties acknowledge that, notwithstanding anything in the
Applicable Requirements or this Agreement to the contrary,
Wendover will have no obligation whatsoever to make any advances
to any third party.
CONFIDENTIAL Sub-Servicing Agreement 5
2.13 Statements to Client and Reporting Requirements. Wendover will send to
Client via United States mail, statements setting forth information with
respect to the Mortgage Loans as required by Applicable Requirements.
2.14 Additional Services.
(a) From time to time, Client may request Wendover to perform
Additional Services (including, without limitation, any and all
technical and personnel resources required to (i) accommodate
and assist the audits described in Section 3.2; (ii) support
Client's securitization efforts; (iii) accommodate changes in
the Material Assumptions, the Roles and Responsibilities Matrix
or other Applicable Requirements; or other requirements of
Client, including without limitation support for litigation,
mergers, acquisitions and other transactions); (iv) accommodate
changes in the type or timing of remittances; (v) support
amendments to the Mortgage Loan Schedule; and (vi) develop ad
hoc reports, etc.).
(b) Wendover will provide to Client such Additional Services as
Client may reasonably request in writing from time to time
during the term of this Agreement and with respect to which the
parties have reached written agreement regarding the nature and
scope of such Additional Services. Such agreement with respect
to any Additional Services will be set forth in a written letter
agreement which will contain the following information, as
applicable: (i) a reference to this Agreement, which reference
will be deemed to incorporate all of the provisions of this
Agreement; (ii) the date as of which the provisions of the
letter will become effective and, if applicable, the term or
period of time during which the services or resources referenced
therein will be provided; (iii) a description of the services or
resources to be provided by Wendover pursuant to the letter;
(iv) a description of Client's responsibilities relating to the
letter, including any facilities, hardware, software or other
support that will be required; (v) the amounts payable for the
services or resources provided pursuant to the letter and the
schedule on which such amounts will be invoiced; and (vi) any
additional provisions applicable to the services or resources to
be provided pursuant to the letter that are not otherwise set
forth in this Agreement or that are exceptions to the provisions
set forth in this Agreement.
2.15 Location of Services. Notwithstanding anything to the contrary in this
Agreement, Wendover may, in its sole discretion, perform the Services or
any portion thereof from any location determined by Wendover, or
relocate any software or equipment used by Wendover to perform the
Services; provided however, that any change in service location made by
Wendover in its sole discretion shall not (i) materially and adversely
impact Wendover's ability to perform its obligations hereunder, (ii)
increase Client's fees or costs (unless Wendover agrees to reimburse
Client for such increase in Client's fees and costs), or (iii)
materially and adversely impact the way in which Client conducts its
business or operations.
CONFIDENTIAL Sub-Servicing Agreement 6
2.16 Client Facilities. At any time during the term of this Agreement,
Wendover may propose to Client an arrangement under which Wendover may
use all or a portion of the Client facilities from which Wendover is
performing the Services hereunder (the "Client Facilities") to perform
services for other clients of Wendover. At the time that the parties
enter into such arrangement, the parties will negotiate in good faith to
determine and agree upon the appropriate terms and conditions relating
to Wendover' use of such Client Facilities for other Wendover clients.
ARTICLE III. DATA, CONFIDENTIALITY, AUDIT RIGHTS, CONTINGENCY
PLANNING AND INSURANCE
3.1 Client Data. As between Wendover and Client, information relating to
Client or its customers (the "Client Data") that is provided by Client
hereunder is and will remain the property of Client. Wendover is hereby
authorized to have access to and to make use of the Client Data for the
term of this Agreement as is appropriate for the performance by Wendover
of its obligations hereunder. Wendover will maintain safeguards against
the destruction, loss or alteration of the Client Data in the possession
of Wendover. Upon expiration or termination of this Agreement for any
reason, Wendover will, at Client's expense, return to Client all of the
Client Data in Wendover's possession and in Wendover's then existing
machine-readable format and media. Wendover will not use the Client Data
for any purpose other than providing the Services. If Client Data is
required to be disclosed pursuant to a requirement of a governmental
authority, such Client Data may be disclosed so long as and to the
extent possible Wendover provides Client with timely prior notice of
such requirement and coordinates with Client in an effort to limit the
nature and scope of such required disclosure.
3.2 Audits. Upon written request and reasonable advance notice, Wendover
will, at Client's expense, make available during Wendover's business
hours, its facilities and Servicing Files for audit by:
(i) Employees of Client and its auditors who are from time to time
designated by Client and who agree in writing to the security
and confidentiality obligations and procedures reasonably
required by Wendover; and
(ii) A prospective investor who desires, with Client's written
consent, to examine the Servicing Files and other records
relating to Mortgage Loans; and
(iii) Client or other third party who requests (or demands through
issuance of subpoena or otherwise) Wendover at any time,
including after the termination of this Agreement, to retrieve
information regarding a Mortgage Loan from Wendover's inactive
records; and
(iv) Any state or jurisdiction that, because of the geographic
location of Client's offices, the Mortgaged Property or other
aspect of any of the Mortgage Loans, requires an audit of
Wendover's facilities or Servicing Files.
CONFIDENTIAL Sub-Servicing Agreement 7
Notwithstanding anything to the contrary in this Agreement, Wendover
will not be required to provide access to the proprietary data of
Wendover or other Wendover customers. Client and its agents,
representatives and auditors will keep confidential all information
learned or exchanged in connection with the conduct of an audit, as well
as the results of any audit.
3.3 Reimbursement for Audit-related Expenses. Client will reimburse Wendover
for expenses incurred in connection with all audits and reviews,
including but not limited to the allocated cost of the time of
Wendover's personnel. With respect to any audit required by any state or
jurisdiction as described in Section 3.2(iv), Wendover's expenses will
be charged to Client on a pro rata basis, based on the number of
Mortgage Loans serviced hereunder compared to all other mortgage loans
serviced or sub-serviced by Wendover in such state or jurisdiction, and
shall be payable in accordance with Section 4.3 hereof.
3.4 Reproduction of Documents. This Agreement and all documents relating
hereto, including without limitation (i) consents, waivers and
modifications that may hereafter be executed, (ii) documents received by
any party at the closing, and (iii) financial statements, certificates
and other information previously or hereafter furnished, may be
reproduced by any photographic, photocopy, microfilm, microcard,
miniature photographic or other similar process. Any such reproduction
will be admissible in evidence as the original itself in any judicial or
administrative proceeding, whether or not the original is in existence
and whether or not such reproduction was made by a party in the regular
course of business, and that any enlargement, facsimile or further
reproduction of such reproduction will likewise be admissible in
evidence.
3.5 Data Access. If Wendover has issued to Client a data access security
system in order that Client may access certain data and functions,
Client will:
(i) Access data and functions only in accordance with the Data
Access Procedures described in Exhibit H and to regard and
preserve as confidential all information obtained with respect
to the issuance to Client of a data access security system;
(ii) Indemnify Wendover against and hold Wendover harmless from all
Losses howsoever arising or incurred because of or in connection
with the access of data and functions by Client and the use by
Client or any of its employees, whether authorized or
unauthorized, of the data access security system; and
(iii) Designate a Client employee to serve as the Data Security
Administrator, who will be responsible for (1) receiving and
maintaining all documents and correspondence assigning,
confirming, or otherwise containing user identification codes,
passwords mnemonics, test keys, encryption keys and other
security devices and/or information from Wendover and (2)
administering and monitoring Client's security procedures in
accordance with the Data Access Procedures set forth on Exhibit
H. Unless otherwise designated in writing by Client, the Data
Security Administrator will be the Client Representative
identified by Client pursuant to Section 2.3(a) hereof.
CONFIDENTIAL Sub-Servicing Agreement 8
3.6 Delivery of Financial Information and Reports. Each party will deliver
to the other, within ten (10) days after the publication of its annual
report, or one hundred twenty (120) days after the end of its fiscal
year, whichever is earlier, a copy of:
(i) Its consolidated balance sheet and consolidated subsidiaries, if
any, as at the end of the most recent fiscal year, and
(ii) Its consolidated statements of operations and retained earnings,
and cash flows of it and its consolidated subsidiaries, if any,
for such year.
Each such statement will set forth in comparative form the figures for
the previous fiscal year and will be accompanied by an opinion of a firm
of independent certified public accountants of recognized national
standing that such financial statements present fairly the financial
position, results of operations and cash flows of the party and have
been prepared in accordance with generally accepted accounting
principles consistently applied (except for changes in application in
which such accountants concur).
3.7 Contingency Planning. The parties' responsibilities with respect to
contingency planning will be as follows:
(a) Wendover will develop, maintain and, as necessary in the event
of a disaster, execute a disaster recovery plan (the "Wendover
Plan") for the Wendover location from which Wendover provides
Services hereunder (the "Wendover Servicing Center") and will
provide to Client and its auditors and inspectors such access to
review the Wendover Plan (at Client's expense) as Client may
reasonably request from time to time. Wendover will not be
required to provide access to information of other Wendover
clients.
(b) Client will develop, maintain and, as necessary in the event of
a disaster, execute a business resumption plan (the "Client
Plan") for all Client locations and the telecommunications links
between Client locations and the Wendover Servicing Center and
will provide to Wendover such access to review the Client Plan
(at Wendover's expense) as Wendover may reasonably request from
time to time.
(c) Upon Client's request, Wendover will provide summary reports of
tests of the Wendover Plan or if commercially feasible invite
Client to participate in tests. Client shall be responsible to
assure that the Client Plan is compatible with the Wendover
Plan.
(d) Each party will be responsible for the training of its own
personnel as required in connection with all applicable
contingency planning activities.
3.8 Insurance. Wendover shall maintain insurance as required by law, as well
as other commercially reasonable coverages including, but not limited
to, coverage for employee
CONFIDENTIAL Sub-Servicing Agreement 9
fidelity, general liability and errors and omissions. Policy terms,
limits and deductibles shall be as deemed appropriate by Wendover.
ARTICLE IV. PAYMENTS TO WENDOVER
4.1 Fees. In consideration for the performance of the Services, Client will
pay Wendover the fees and charges set forth on Exhibits C and C.1, in
accordance with the terms and conditions set forth therein.
4.2 Miscellaneous and Out-of-Pocket Expenses. Unless otherwise expressly set
forth herein, Client will reimburse Wendover for any out-of-pocket
expenses incurred by Wendover hereunder, whether such expenses are
incurred pursuant to requests by Client, or as a result of sub-servicing
the Mortgage Loans (including, without limitation, expenses related to
property preservation, recording fees for foreclosures and lien
releases, and shipping charges). Upon the reasonable request of Client,
Wendover will provide Client with an itemized listing of the applicable,
which will be due and payable as set forth in Section 4.3 hereof, or may
be recouped by Wendover as set forth in Section 4.1 hereof.
Notwithstanding the foregoing, however, Wendover shall incur no such
out-of-pocket expenses in excess of two hundred fifty dollars ($250.00)
per occurrence, without the prior approval of Client.
4.3 Method of Payment.
(a) Unless otherwise specifically set forth in this Agreement,
Wendover will deduct or "net" any amount due hereunder from any
funds held by Wendover on behalf of Client prior to disbursing
to Client such funds. All amounts that are not "netted" shall be
due and payable ten (10) days following receipt by Client of the
invoice from Wendover therefor. If Client does not notify
Wendover of any invoice items in dispute within ten (10) days
following receipt of an invoice from Wendover, Client will be
deemed to have approved and accepted such invoice. All amounts
will be payable to Wendover by check, wire transfer, or ACH, in
accordance with payment instructions provided by Wendover from
time to time, so as in each case to constitute immediately
available funds by 12 noon, Plano, Texas time, on the payment
date no matter what the method of payment. If a due date does
not fall on a Business Day, payments must be received by
Wendover on or before one (1) Business Day prior to such date.
(b) Any amount not paid when due as set forth in this Agreement will
bear interest until paid at a rate of interest equal to the
lesser of (i) the prime rate established from time to time by
Citibank of New York plus four percent (4%) or (ii) the maximum
rate of interest allowed by applicable law. If any portion of an
amount due to Wendover under this Agreement is subject to a bona
fide dispute between the parties, Client will pay to Wendover on
the date such amount is due all amounts not disputed in good
faith by Client. Within ten (10) days of the date of the invoice
on which a disputed amount appears, Client will notify Wendover
in writing of the specific
CONFIDENTIAL Sub-Servicing Agreement 10
items in dispute, will describe in detail Client's reason for
disputing each such item, and will deposit such disputed amount
into an escrow account established in the manner set forth in
Section 6.3. Within seven (7) days of Wendover's receipt of such
notice, the parties will begin to negotiate in good faith
pursuant to the provisions of Article VI to reach settlement on
any items that are the subject of such dispute. If Client does
not notify Wendover of any invoice items in dispute within ten
(10) days following receipt of an invoice from Wendover, Client
will be deemed to have approved and accepted such invoice.
Notwithstanding anything to the contrary in this Agreement, in
no event may Client withhold in any one month, as a disputed
amount, more than fifty percent (50%) of Wendover's charges
(exclusive of reimbursable expenses) for that month.
4.4 Taxes. There will be added to any charges under this Agreement, and
Client will either pay to Wendover, or reimburse Wendover for the
payment of, amounts equal to any taxes, assessments, duties, permits,
fees and other charges of any kind, however designated, assessed,
charged or levied, based on, with respect to or measured by (i) such
charges, (ii) this Agreement, or (iii) the Services, software,
equipment, materials or other property (tangible or intangible), or the
use thereof or the resources used therefor, that are provided under this
Agreement. Charges payable under this Section 4.4 include state and
local sales taxes, use taxes, property taxes, telecommunications taxes,
privilege taxes, excise taxes (including federal excise taxes), value
added taxes and any taxes or amounts in lieu thereof paid or payable by
Wendover in respect of the foregoing, exclusive however, of taxes based
on the net income of Wendover.
4.5 Charges for Additional Services. In consideration for any agreement by
Wendover to provide Additional Services, Client will pay to Wendover the
amounts mutually agreed to in writing by Wendover and Client for such
Additional Services, and the miscellaneous and out-of-pocket expenses
incurred by Wendover in connection therewith.
ARTICLE V. REPRESENTATIONS AND WARRANTIES
5.1 Client Representations and Warranties. Client hereby represents and
warrants to Wendover as of the Transfer Date for each Mortgage Loan:
(a) Client is a limited liability company duly organized, validly
existing and in good standing under the laws of the state under
which it was organized and to the best of Client's knowledge has
all licenses and is in compliance with all regulations necessary
to carry on its business as now being conducted and is licensed,
qualified and in good standing in the states where the Mortgaged
Properties are located if the laws of such states require
licensing or qualification in order to hold its interest in the
Mortgage Loans.
(b) Client has the power and authority to enter into, execute and
deliver this Agreement and all documents and instruments
executed and delivered pursuant hereto and to perform its
obligations in accordance herewith; the execution,
CONFIDENTIAL Sub-Servicing Agreement 11
delivery and performance of this Agreement (including all
instruments of transfer to be delivered pursuant thereto) by
Client and the consummation of the transactions contemplated
hereby have been duly and validly authorized; this Agreement
evidences the valid, binding and enforceable obligations of
Client; and all requisite corporate action has been taken by
Client to make this Agreement valid and binding upon Client in
accordance with its terms.
(c) No consent, approval, authorization or order of any court or
governmental agency or body relating to the transactions
contemplated by this Agreement is required or, if required, such
consent, approval, authorization or order has been or will,
prior to the Transfer Date, be obtained.
(d) The consummation of the transactions contemplated by this
Agreement and the fulfillment of or compliance with the terms
and conditions of this Agreement are in the ordinary course of
business of Client and will not result in the breach of any term
or provision of the articles of organization or operating
agreement of Client or result in the breach of any term or
provision of, or conflict with or constitute a default under, or
result in the acceleration of any obligation under, any
agreement, indenture, loan, credit agreement or other instrument
to which Client or its property is subject, or result in the
violation of any law, rule, regulation, order, judgment or
decree to which Client or its property is subject.
(e) Client owns all rights to service the Mortgage Loans. If any
Mortgage Loan is an FHA Loan, a GNMA Loan or a VA Loan, Client
is an approved Seller/Servicer in good standing with FHA, GNMA
or VA, as applicable.
(f) Each Mortgage Loan has been originated and serviced in
compliance with all applicable (i) federal, state and local
laws, statutes, regulations and ordinances and (ii) requirements
of any Mortgage Loan insurers, including without limitation,
FHA, HUD and VA.
(g) All real estate taxes on each Mortgage Loan have been paid in
full at least forty-five (45) days before the applicable tax
delinquent date; provided, however, this representation and
warranty will not apply regarding Mortgage Loans as to which no
tax information is reasonably available. Notwithstanding the
foregoing, all real estate taxes on each Mortgage Loan that have
been or may become delinquent within thirty (30) days of the
Transfer Date have been paid in full.
(h) Client has reviewed and understands (i) the Roles and
Responsibilities Matrix and represents that it can perform each
and every obligation set forth in this Agreement; and (ii) the
Material Assumptions and the Mortgage Loan Schedule and
represents that the information set forth therein is current,
accurate and complete.
5.2 Wendover Representations. Wendover hereby represents and warrants to
Client as of the Effective Date:
CONFIDENTIAL Sub-Servicing Agreement 12
(a) Wendover is a corporation duly organized, validly existing and
in good standing under the laws of the state of North Carolina
and to the best of Wendover's knowledge has all licenses and is
in compliance with all regulations necessary to carry on its
business as now being conducted and is licensed, qualified and
in good standing in the states where the Mortgaged Properties
are located if the laws of such states require licensing or
qualification in order to conduct business of the type conducted
by Wendover hereunder.
(b) Wendover has the corporate power and authority to enter into,
execute and deliver this Agreement and all documents and
instruments executed and delivered pursuant hereto, and to
perform its obligations in accordance herewith; the execution,
delivery and performance of this Agreement by Wendover and the
consummation of the transactions contemplated hereby have been
duly and validly authorized; this Agreement evidences the valid,
binding and enforceable obligations of Wendover; and all
requisite corporate action has been taken by Wendover to make
this Agreement valid and binding upon Wendover in accordance
with its terms.
(c) No consent, approval, authorization or order of any court or
governmental agency or body is required for Wendover to enter
into this Agreement or, if required, such consent, approval,
authorization or order has been or will, prior to the Transfer
Date, be obtained.
(d) The consummation of the transactions contemplated by this
Agreement and the fulfillment of or compliance with the terms
and conditions of this Agreement are in the ordinary course of
business of Wendover and will not result in the breach of any
term or provision of the articles of incorporation or by-laws of
Wendover or result in the breach of any term or provision of, or
conflict with or constitute a default under, or result in the
acceleration of any obligation under, any agreement, indenture,
loan, credit agreement or other instrument to which Wendover or
its property is subject, or result in the violation of any law,
rule, regulation, order, judgment or decree to which Wendover or
its property is subject.
(e) Wendover is an approved servicer of conventional Mortgage Loans
for Xxxxxx Xxx and Xxxxxxx Mac. Wendover is in good standing to
service Mortgage Loans for GNMA, FHA and VA.
5.3 Disclaimer of Other Warranties. EXCEPT AS EXPRESSLY SET FORTH IN
SECTION 5.2, WENDOVER MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR
IMPLIED, REGARDING ANY MATTER, INCLUDING THE MERCHANTABILITY,
SUITABILITY, ORIGINALITY, FITNESS FOR A PARTICULAR USE OR PURPOSE, OR
RESULTS TO BE DERIVED FROM THE USE, OF THE SERVICES PROVIDED UNDER THIS
AGREEMENT. WENDOVER DOES NOT REPRESENT OR WARRANT THAT THE OPERATION OF
ANY SOFTWARE WILL BE UNINTERRUPTED OR ERROR-FREE.
CONFIDENTIAL Sub-Servicing Agreement 13
5.4 Remedies for Breach of Representations and Warranties. The
representations and warranties in this Article V will survive the
execution and delivery of this Agreement. Upon discovery by either party
of a breach of the foregoing representations and warranties that
materially adversely affects the interests of the other party, the party
discovering such breach will give prompt written notice to the other. In
the event such breach is not cured within sixty (60) days of receipt of
such written notice, the non-breaching party may terminate this
Agreement pursuant to the terms of Section 7.1 hereof.
ARTICLE VI. DISPUTE RESOLUTION PROCEDURES
6.1 Dispute Resolution. In the event of any dispute, controversy or claim of
any kind or nature arising under or in connection with this Agreement
(including disputes as to the creation, validity, interpretation, breach
or termination of this Agreement) (a "Dispute"), then upon the written
request of either party, each of the parties will appoint a designated
senior business executive whose task it will be to meet for the purpose
of endeavoring to resolve the Dispute. The designated executives will
meet as often as the parties reasonably deem necessary in order to
gather and furnish to the other all information with respect to the
matter in issue which the parties believe to be appropriate and germane
in connection with its resolution. Such executives will discuss the
Dispute and will negotiate in good faith in an effort to resolve the
Dispute without the necessity of any formal proceeding relating thereto.
The specific format for such discussions will be left to the discretion
of the designated executives but may include the preparation of agreed
upon statements of fact or written statements of position furnished to
the other party. If, after thirty (30) days following the initial
request to negotiate the Dispute, the designated executives conclude in
good faith that the parties are unable to resolve the Dispute, then the
Dispute will be escalated in accordance with the Dispute resolution
procedures set forth on Exhibit G hereof.
6.2 Exclusive Remedy. Other than those matters involving injunctive or other
extraordinary relief or any action necessary to enforce the award of the
arbitrator, the parties agree that the provisions of this Article VI are a
complete defense to any suit, action or other proceeding instituted in any
court or before any administrative tribunal with respect to any Dispute or
the provision of the Services by Wendover. Nothing in this Article VI
prevents the parties from exercising their rights to terminate this
Agreement in accordance with Article VII.
6.3 Continued Performance; Escrow Account. Unless (i) Wendover has commenced
a proceeding or has presented a claim pursuant to this Article VI for
nonpayment by Client of amounts due under this Agreement, and Client
does not promptly pay all amounts in dispute into the escrow account
referred to below and does not otherwise continue to make payments to
Wendover in accordance with this Agreement of all amounts not required
to be so escrowed, or (ii) this Agreement has been terminated in
accordance with Article VII, Wendover will continue to provide the
Services hereunder during any dispute resolution proceedings (whether
informal or formal) commenced pursuant to this Article VI, and Client
will continue to perform its obligations (including the making of
payments to
CONFIDENTIAL Sub-Servicing Agreement 14
Wendover) in accordance with this Agreement. Up to the maximum amount in
dispute, any disputed payment will be paid pending resolution of the
Dispute into an escrow account that is structured by agreement of the
parties or, if agreement cannot be reached, as directed by the mediator
or arbitrator, as the case may be, engaged in accordance with this
Article VI. Any such escrow account will provide for the payment of
interest on the amounts deposited therein, and the parties (if the
Dispute is resolved informally) or the mediator or arbitrator, as the
case may be (if the Dispute is resolved formally), will make the
determination regarding distribution of such deposited amounts plus
interest. In addition to the escrow, Client will continue to make
payment to Wendover of all amounts not in dispute in accordance with
this Agreement. If Client fails to escrow disputed payments or to
otherwise continue to make payments to Wendover in accordance with this
Agreement of all amounts not required to be so escrowed, Wendover may
apply to any court of competent jurisdiction to seek injunctive relief
for such failure and will have the right to terminate this Agreement in
accordance with Section 7.2.
ARTICLE VII. TERMINATION OF AGREEMENT
7.1 Termination for Cause. If either party materially defaults in the
performance of any of its duties or obligations under this Agreement
(except for a default in payments to Wendover, which will be governed by
Section 7.2), which default is not substantially cured within sixty (60)
after written notice is given to the defaulting party specifying such
default (or, with respect to those defaults that cannot reasonably be
cured within sixty (60) days, should the defaulting party fail to
proceed within sixty (60) days to commence curing the default and
thereafter to proceed with reasonable diligence to substantially cure
the default), the party not in default may, by giving written notice
thereof to the defaulting party, terminate this Agreement as of the date
of receipt by the defaulting party of such notice or as of a future date
specified in such notice of termination. In addition to the requirements
of Section 9.6, to be effective and to commence the running of any
applicable cure period, any notice given pursuant to this Section 7.1
must explicitly identify the type of notice being given, whether of
default or termination, and reference this Section 7.1.
7.2 Termination for Nonpayment. If Client defaults in the payment when due
of any amount due to Wendover pursuant to this Agreement (including the
payment of past due interest), and does not cure such default within ten
(10) days after being given written notice of such default or otherwise
does not comply with Section 6.3, Wendover may, by giving written notice
thereof to Client, terminate this Agreement as of the date of receipt by
Client of such notice or as of a future date specified in such notice of
termination. In addition to the requirement of Section 9.6, to be
effective and to commence the running of any applicable cure period, any
notice given pursuant to this Section 7.2 must explicitly identify the
type of notice being given, whether of default or of termination, and
reference this Section 7.2.
7.3 Termination for Bankruptcy and Related Events. Subject to Xxxxx 00,
Xxxxxx Xxxxxx Code, if either party becomes or is declared insolvent or
bankrupt, is the subject of any proceedings relating to its liquidation,
insolvency or for the appointment of a receiver or similar officer for
it, makes an assignment for the benefit of all or substantially all of
its
CONFIDENTIAL Sub-Servicing Agreement 15
creditors or enters into an agreement for the composition, extension or
readjustment of all or substantially all of its obligations, then the
other party may, by giving written notice thereof to such party,
terminate this Agreement as of a date specified in such notice of
termination.
7.4 Material Assumptions. Client acknowledges and agrees that (i) the fees
set forth on Exhibit C are contingent upon the validity of the Material
Assumptions set forth on Exhibit D and, (ii) if any of the Material
Assumptions are, at any time during the term of this Agreement, invalid,
then Wendover and Client will negotiate in good faith an equitable
adjustment in Wendover's fees. If the parties fail to agree to such an
adjustment within thirty (30) calendar days, then Wendover may terminate
this Agreement upon sixty (60) days' written notice, and Client will pay
Wendover the Exit Fee described in Exhibit C, which amount will be due
and payable prior to the effective date of termination.
7.5 Termination for Events Related to Line of Credit. If Wendover receives
from Textron a copy of a Shifting Control Notice pursuant to the Blocked
Account Control Agreement or directions regarding the Proceeds and
Instruments and Documents pursuant to the Bailee Agreement and Waiver,
or Client otherwise defaults under its line of credit with Textron, then
Wendover may, by giving written notice to Client, terminate this
Agreement as of a date specified in such notice of termination.
7.6 Effect of Expiration or Termination. Upon expiration or termination of
this Agreement, Wendover will cease to perform the Services, and Client
will pay to Wendover all amounts due to Wendover hereunder for all
Services performed by or on behalf of Wendover hereunder. The
termination of this Agreement will in no event relieve the parties of
any obligation or liability incurred hereunder prior thereto, including
the payment and indemnification obligations and liabilities set forth
herein.
7.7 Transition Assistance. In connection with the expiration or termination
of this Agreement for any reason, and if requested by Client in writing
within at least sixty (60) days, prior to the applicable expiration date
or effective date of termination, Wendover will, at Client's written
request and expense, prepare, execute and deliver to a successor any and
all of Client's documents and other instruments as may be in Wendover's
possession, and do such other acts or things necessary or appropriate to
effect the purposes of such notice of termination. Wendover will
reasonably cooperate with Client and such successor in effecting the
termination of Wendover's rights and responsibilities hereunder,
including, without limitation, the transfer to such successor for
administration by it of the P&I Custodial Account, and funds thereafter
received with respect to the Mortgage Loans and to which Wendover is not
entitled pursuant to this Agreement. Wendover will have no obligation to
provide any form of transition assistance if Wendover terminates this
Agreement for cause or pursuant to Section 7.5 hereof. Unless otherwise
agreed in writing, Client will pay Wendover for such transition
assistance at Wendover's then current commercial billing rates on a
monthly basis in advance.
CONFIDENTIAL Sub-Servicing Agreement 16
ARTICLE VIII. INDEMNIFICATION AND LIABILITY
8.1 General Indemnification. Wendover and Client each will be responsible
for Losses to their respective tangible personal or real property
(whether owned or leased), and each party agrees to look only to its own
insuring arrangements (if any) with respect to such Losses. Wendover and
Client each will be responsible for Losses for the death of or personal
injury to any person (including any employee of either party) and Losses
for damages to any third party's tangible personal or real property
(whether owned or leased), in accordance with the law of the
jurisdiction in which such Loss is alleged to have occurred. Subject to
Sections 8.4 and 8.5 hereof, each party will indemnify and defend the
other party and hold the other party harmless from any and all Losses
arising out of, under or in connection with claims for which the
indemnitor is responsible under the preceding sentence.
8.2 Third party Claims. Without limiting Wendover's liability to Client
under this Agreement, each of the parties acknowledge that by entering
into and performing its obligations under this Agreement Wendover will
not assume and should not be exposed to the business and operational
risks associated with Client's business, and Client therefore agrees to
indemnify and defend Wendover and hold Wendover harmless from any and
all third party Losses arising out of the conduct of Client's business,
including but not limited to the use by Client of the Services, and
(i) The action or inaction of any prior servicer of the Mortgage
Loans;
(ii) Tax penalties and interest that arose or accrued through the
period ending forty-five (45) days after the Transfer Date;
(iii) Any dispute between Mortgagor(s) and Client or Mortgagor(s) and
Wendover, or any dispute between Warehouse Lender(s) and Client
or Warehouse Lender(s) and Wendover (including any disputes
under the Blocked Account Control Agreement, the Bailee
Agreement and Waiver, or the Indemnification Agreement);
(iv) Insufficient hazard insurance coverage or hazard insurance
coverage that lapsed prior to the Transfer Date;
(v) Inaccurate or incomplete information supplied to Wendover by
Client or any agent, consultant, vendor, subcontractor or
representative thereof;
(vi) Advances for negative amortization;
(vii) Damage to person or property occurring on a Mortgaged Property;
(viii) Wendover's appearance or participation in, or defense of, any
legal action that is ancillary to Wendover's duties under this
Agreement and that in its opinion may involve it in any expense
or liability; provided, however, that Wendover may with the
consent of Client, undertake any such action that it may deem
necessary or
CONFIDENTIAL Sub-Servicing Agreement 17
desirable with respect to this Agreement and the rights, duties
and the interests of the parties hereto. In such event, Client
will be responsible for the Losses and will reimburse Wendover
therefor; and
(ix) Any environmental matters or claims relating to or arising from
the Mortgaged Properties, including but not limited to
violations of federal, state or local laws, regulations or
ordinances.
8.3 Exclusions.
(a) Wendover will not be liable for any action taken or for
refraining from the taking of any action in good faith pursuant
to this Agreement, or for any action or inaction in accordance
with the direction or consent of Client, or any inaction
resulting from Client's failure to agree regarding a request by
Wendover for direction or consent in accordance with
Section 2.3(c) hereof.
(b) In addition to the foregoing and not in limitation thereof,
Wendover will have no liability or obligation for the servicing
or sub-servicing of the Mortgage Loans prior to the applicable
Transfer Date.
(c) Notwithstanding anything herein to the contrary, Wendover will
not be construed to have made any representation, warranty or
guarantee as to the payments under the Mortgage Loans.
8.4 Procedures. The indemnification obligations set forth in
Sections 8.1 and 8.2 will not apply unless the party claiming
indemnification:
(i) Notifies the other promptly in writing of any matters in respect
of which the indemnity may apply and of which the notifying
party has knowledge in order to allow the indemnitor the
opportunity to investigate and defend the matter; provided,
however, that the failure to so notify will only relieve the
indemnitor of its obligations under this Article VIII if and to
the extent that the indemnitor is prejudiced thereby; and
(ii) Gives the other party full opportunity to control the response
thereto and the defense thereof, including any agreement
relating to the settlement thereof; provided, however, that the
indemnitee will have the right to participate in any legal
proceeding to contest and defend a claim for indemnification
involving a third party and to be represented by legal counsel
of its choosing, all at the indemnitee's cost and expense.
However, if the indemnitor fails to promptly assume the defense
of the claim, the party entitled to indemnification may assume
the defense at the indemnitor's cost and expense.
The indemnitor will not be responsible for any settlement or compromise
made without its consent, unless the indemnitee has tendered notice and
the indemnitor has then refused to assume and defend the claim and it is
later determined that the indemnitor was liable to
CONFIDENTIAL Sub-Servicing Agreement 18
assume and defend the claim. The indemnitee agrees to cooperate in good
faith with the indemnitor at the request and expense of the indemnitor.
8.5 Limitation of Liability.
(a) The liability of each party to the other for all damages arising
out of or related this Agreement, regardless of the form of
action that imposes liability, whether in contract, equity,
negligence, intended conduct, tort or otherwise, will be limited
to and will not exceed, in the aggregate for all claims, actions
and causes of action of every kind and nature, the sum of the
Monthly Sub-Servicing Fees actually received by Wendover for the
six (6) calendar months ending with the month in which occurred
the event giving rise to the liability.
(b) In no event will the measure of damages payable by either party
include, nor will either party be liable for, any amounts for
loss of income, profit or savings or indirect, incidental,
consequential, exemplary, punitive or special damages of any
party, including third parties, even if such party has been
advised of the possibility of such damages in advance, and all
such damages are expressly disclaimed.
(c) The limitations set forth in Sections 8.5(a) and 8.5(b) will not
apply to the liability of Client under Section 8.2, or to the
liability of either party to the extent such liability results
from (i) that party's acts of intentional tortious conduct in
the performance or nonperformance of its obligations under this
Agreement or (ii) that party's nonperformance of its payment
obligations to the other expressly set forth in this Agreement
for Services performed hereunder or for payment or reimbursement
of taxes, out-of-pockets expenses or pass-through expenses, and
Wendover's lost profits on such payments.
(d) Each party has a duty to mitigate the damages that would
otherwise be recoverable from the other pursuant to this
Agreement by taking appropriate and reasonable actions to reduce
or limit the amount of such damages.
(e) No claim, demand for mediation or arbitration or cause of action
which arose out of an event or events which occurred more than
two years prior to the filing of a demand for mediation or
arbitration or suit alleging a claim or cause of action may be
asserted by either party against the other.
(f) The parties expressly acknowledge that the limitations and
exclusions set forth in this Article VIII have been the subject
of active and complete negotiation between the parties and
represent the parties' agreement taking into account each
party's level of risk associated with the performance or
nonperformance of its obligations under this Agreement and the
payments and other benefits to be derived by each party
hereunder and thereunder. The provisions of this Article VIII
will survive the expiration or termination of this Agreement for
any reason.
CONFIDENTIAL Sub-Servicing Agreement 19
ARTICLE IX. MISCELLANEOUS
9.1 Entire Agreement; Amendment; Survival. This Agreement, including the
Exhibits that are incorporated herein, constitutes the complete and
exclusive agreement of the parties with respect to the Mortgage Loans,
and supersedes all prior agreements or understandings, written or oral,
express or implied, relating to the subject matter hereof. This
Agreement may be amended only by a written agreement signed by both
parties. The expiration or termination of this Agreement for any reason
will not release either party from any liabilities or obligations set
forth herein or therein which (a) the parties have expressly agreed will
survive any such expiration or termination or (b) remain to be performed
or by their nature would be intended to be applicable following any such
expiration or termination.
9.2 Exhibits. The following exhibits to this Agreement are hereby
incorporated in and made an integral part of this Agreement:
Exhibit A ......Definitions
Exhibit B ......Roles and Responsibilities Matrix
Exhibit C ......Fees
Exhibit C.1 ....Other Fees
Exhibit D ......Material Assumptions
Exhibit E ......Mortgage Loan Schedule
Exhibit F ......Intentionally Omitted
Exhibit G ......Dispute Resolution Procedures
Exhibit H ......Data Access Procedures
9.3 Effect of Headings. The headings in this Agreement are for purposes of
reference only and will not limit or otherwise affect the meaning of
this Agreement.
9.4 Severability of Provisions. If any one or more of the covenants,
agreements, provisions or terms of this Agreement will be held invalid
for any reason whatsoever, then such covenants, agreements, provisions
or terms will be deemed severable from the remaining covenants,
agreements, provisions or terms of this Agreement and will in no way
affect the validity or enforceability of the other covenants,
agreements, provisions or terms of this Agreement. If the invalidity of
any part, provision, representation or warranty of this Agreement will
deprive any party of the economic benefit intended to be conferred by
this Agreement, the parties will negotiate in good faith to develop a
structure the economic effect of which is nearly as possible the same as
the economic effect of this Agreement without regard to such invalidity.
9.5 Counterparts; Successors and Assigns. This Agreement may be executed in
one or more counterparts and by the different parties hereto on separate
counterparts, each of which, when so executed, will be deemed to be an
original; such counterparts, together, will constitute one and the same
agreement. This Agreement may be assigned only with the prior written
consent of the other party hereto; provided, however, that Wendover
CONFIDENTIAL Sub-Servicing Agreement 20
may (i) assign this Agreement to any affiliated entity, and/or (ii)
assign its rights to Client's payments hereunder, including any
termination amount payable pursuant to Article VII, to a financial
institution or other third party in connection with any transaction
entered into to provide financing related to this Agreement or the
obligations of Wendover hereunder, and any such assignee may further
assign its rights hereunder in connection with such financing. Subject
to all applicable privacy laws, Client acknowledges that Wendover shall
have the right to disclose this Agreement or other confidential related
information to professional advisors, financial institutions, or other
third parties to secure such financing.
9.6 Notices. All notices, requests, demands and other communications that
are required or permitted to be given under this Agreement will be in
writing and will be deemed to have been given upon the delivery or
mailing of such notice, as the case may be, sent by registered or
certified mail, return receipt requested, postage prepaid; overnight
express delivery or facsimile to the addresses set forth below. Either
party may change its designated addressee by giving written notice
thereof to the other party.
(a) If to Client:
Great Lakes Capital Acceptance, LLC
Great Lakes Funding I, LLC
00 Xxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
ATTN: Xxxxxx Xxxxxxxx
(b) If to Wendover:
Wendover Financial Services Corporation
000 Xxxxx Xxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
ATTN: President
with a copy to:
Electronic Data Systems Corporation
Office of Legal Affairs
0000 Xxxxxx Xxxxx, X0-0X-00
Xxxxx, XX 00000
ATTN: General Counsel
9.7 Force Majeure. Wendover will not be responsible for delays or failures
in performance resulting from acts beyond its control. Such acts will
include but not be limited to "acts of God" or third parties, strikes,
lockouts, riots, acts of war or terrorism, epidemics, nationalization,
expropriation, currency restrictions, governmental regulations, fire,
communication line failures, computer viruses, power failures,
earthquakes or other disasters, or Textron's taking control of the P&I
Custodial Account pursuant to the
CONFIDENTIAL Sub-Servicing Agreement 21
Blocked Account Control Agreement or directing Wendover to deliver
possession of the Proceeds and Instruments and Documents to Textron or a
third party pursuant to the Bailee Agreement and Waiver.
9.8 Independent Contractors. The parties hereto are independent contractors
and nothing in this Agreement will be deemed or construed as
constituting either party as partner, joint venturer or fiduciary of the
other, or to create any other form of legal association that would
impose liability on one party for the act or failure to act of the
other. Except as otherwise expressly provided in this Agreement, each
party has the sole right and obligation to supervise, manage, contract,
direct, procure, perform or cause to be performed all work to be
performed by it pursuant to this Agreement.
9.9 No Third Party Beneficiaries. This Agreement is for the sole and
exclusive benefit of Wendover and Client and shall not be deemed to be
for the direct or indirect benefit of any Mortgagor or any other person
or entity.
9.10 Subcontracting. Wendover may subcontract any portion of the Services to
third parties. Wendover will not disclose any confidential information
of Client to any such subcontractor unless and until the subcontractor
has agreed in writing to protect the confidentiality of such
confidential information in the manner required by this Agreement and
then only to the extent necessary for the subcontractor to perform those
Services subcontracted to it. Wendover will remain responsible for the
obligations performed by any of its subcontractors to the same extent as
if such obligations were performed by Wendover.
9.11 Governing Law. This Agreement will be governed by and construed in
accordance with the substantive laws of the state of North Carolina,
without giving effect to any choice-of-law rules that may require the
application of the laws of another jurisdiction. If any dispute arises
hereunder, the parties hereto agree that any such dispute will be heard
in courts of North Carolina or any federal court sitting in North
Carolina, and Client hereby consents to the jurisdiction of such courts.
9.12 Client. Notwithstanding anything to the contrary set forth in this
Agreement, the parties agree that (i) Wendover shall submit a single
invoice, to the address set forth in Section 9.6, for the Services
performed under this Agreement, even if such Services are provided to
both GLCA and GLF; (ii) GLCA and GLF each agrees to be jointly and
severely liable for the obligations (including payment obligations) of
"Client" under this Agreement; and (iii) all damages or indemnities that
may be payable over time by Wendover under this Agreement to either GLCA
or GLF shall not exceed, in the aggregate, the limitation of liability
set forth in Section 8.5.
CONFIDENTIAL Sub-Servicing Agreement 22
IN WITNESS WHEREOF, each of Client and Wendover has caused its name to
be signed hereto by its duly authorized representative as of the day and year
first above written.
GREAT LAKES CAPITAL WENDOVER FINANCIAL SERVICES
ACCEPTANCE, LLC CORPORATION
By: /s/ XXXXXX XXXXXXXX XX By: /s/ XXXXXXX X. XXXXXX
---------------------------- -------------------------------
Name: XXXXXX XXXXXXXX XX Name: XXXXXXX X. XXXXXX
Title: PRESIDENT Title: EXECUTIVE VICE PRESIDENT
Date: MAY 10, 2003 Date: MAY 9, 2003
GREAT LAKES FUNDING I, LLC
By: /s/ XXXXXX XXXXXXXX XX
-----------------------------
Name: XXXXXX XXXXXXXX XX
Title: MANAGER
Date: MAY 10, 2003
Document 130861V8
CONFIDENTIAL Sub-Servicing Agreement 23
EXHIBIT A
(to Sub-Servicing Agreement)
DEFINITIONS
All capitalized words and phrases used in this Agreement, unless the context
otherwise requires, will have the meanings set forth below.
Additional Services: All services that are not reflected as Wendover obligations
on the Roles and Responsibilities Matrix, or otherwise expressly agreed to in
this Agreement, that Client may from time to time request, and Wendover may
agree to provide, in accordance with Section 2.14 hereof.
Agency: Any agency of the federal government, including GNMA, FHA and VA.
Agreement: This Sub-Servicing Agreement, including all written amendments
hereof, and all Exhibits incorporated herein.
Applicable Requirements: The Mortgage Loan sub-servicing procedures that
Wendover will follow in performing the Services hereunder, as described in:
(i) all applicable federal, state and local laws; and
(ii) the written, published requirements of VA or FHA for Mortgage
Loans that are guaranteed by, or insured by, VA or FHA,
respectively, including any written and generally published
amendments thereof; and
(iii) the Roles and Responsibilities Matrix, which is attached hereto
and incorporated into this Agreement as Exhibit B, including any
mutually agreeable written instructions of Client.
Bailee Agreement and Waiver: That certain Bailee Agreement and Waiver dated of
even date herewith, between Client, Textron, and Wendover.
Bankruptcy: (i) The filing of a petition for the declaration of bankruptcy
pursuant to Chapters 7, 11, 12 or 13 of the Bankruptcy Reform Act of 1978, as
amended; or (ii) the admission in writing of the inability to pay debts as they
become due, the filing of a petition to take advantage of any applicable
insolvency or reorganization statute or the making of an assignment for the
benefit of creditors.
Blocked Account Control Agreement: That certain Blocked Account Control
Agreement dated of even date herewith, between Client, Textron, Wendover, and
JPMorgan Chase Bank.
Business Day: Any day other than (i) a Saturday or Sunday, or (ii) a day on
which banking or savings and loan institutions in the state of North Carolina
are authorized or obligated by law or executive order to be closed or (iii) a
day on which Wendover is closed.
Exhibit A of Sub-Servicing Agreement 1 of 4
Client: Defined in the preamble of this Agreement.
Custodian: The third party designated by Client as the official repository of
all original documents relating to the Mortgage Loans, or any successor in
interest or assign, or any successor custodian designated by Client.
Effective Date: The first date upon which this Agreement will be binding upon
the parties, as defined in the first paragraph of this Agreement.
Exit Fee: The fee payable to Wendover pursuant to Section 7.4 of this Agreement,
as set forth in Exhibit C.
Xxxxxx Xxx: The Federal National Mortgage Association.
FHA: The Federal Housing Administration of the United States Department of
Housing and Urban Development.
FHA Loan: A Mortgage Loan identified on the Mortgage Loan Schedule as having FHA
insurance.
Foreclosure: As to any Mortgage Loan, the period beginning with the date that
the Mortgage Loan is referred to an attorney for collection.
Xxxxxxx Mac: The Federal Home Loan Mortgage Corporation.
GLCA: Defined in the preamble of this Agreement.
GLF: Defined in the preamble of this Agreement.
GNMA: The Government National Mortgage Association.
GNMA Loan: An FHA Loan or a VA Loan identified on the Mortgage Loan Schedule as
having a GNMA guaranty.
Indemnification Agreement: That certain Indemnification Agreement dated of even
date herewith, between Wendover and Textron.
Instruments and Documents: Instruments and Documents shall have the meaning
assigned to such term in the Bailee Agreement and Waiver.
Losses: Any and all claims, actions, damages, liabilities, costs and expenses,
including reasonable attorneys' fees and expenses.
Exhibit A of Sub-Servicing Agreement 2 of 4
Material Assumptions: The information set forth on Exhibit D hereof, that
Wendover has received from Client or has otherwise depended upon in developing
the fees set forth on Exhibit C hereof.
Monthly Sub-Servicing Fee: The recurring monthly charge payable to Wendover as
set forth in Paragraph 1(a) of Exhibit C of this Agreement.
Mortgage: The mortgage, mortgage deed, deed of trust or other instrument
creating a lien on or ownership interest in an estate in fee simple in
residential real property securing a Mortgage Note, including any riders,
assumption agreements or modifications.
Mortgage Loan: An individual mortgage loan that is sub-serviced by Wendover
under this Agreement, as identified on the Mortgage Loan Schedule.
Mortgage Loan Schedule: The Mortgage Loan-related information set forth on
Exhibit E of this Agreement, which will include but not be limited to the number
and type of Mortgage Loans (e.g. fixed rate, adjustable rate, etc.), and such
other information as Wendover may reasonably require in order to formulate the
fees set forth on Exhibit C hereof.
Mortgage Note: The note or other evidence of the indebtedness of a Mortgagor.
Mortgage Record: Any Mortgage Loan-related servicing data, electronic or
otherwise, received by Wendover or considered by Wendover to be necessary or
appropriate in order for Wendover to perform the Services hereunder.
Mortgaged Property: The real property securing a Mortgage Note pursuant to the
related Mortgage.
Mortgagor: The obligor on a Mortgage Note.
P&I Custodial Account: The account created and maintained pursuant to Section
2.4 hereof.
Proceeds: Proceeds shall have the meaning assigned to such term in the Bailee
Agreement and Waiver.
Services. The Mortgage Loan-related functions specifically described in (i) the
Roles and Responsibilities Matrix and other Applicable Requirements, and (ii)
the terms and conditions of this Agreement.
Servicing File: With respect to any Mortgage Loan, all "hard" copies of
documents or records that Wendover considers necessary or appropriate in order
to fulfill its obligations under this Agreement, including the (i) Mortgage Note
and prepayment penalty addendum (if applicable); (ii) deed of trust; legal
description of Mortgaged Property; (iii) adjustable rate mortgage rider (if
applicable); (iv) buydown schedule (if applicable); (v) HUD settlement statement
(HUD 1); (vi) hazard insurance policy; (vii) flood insurance certificate; (viii)
tax information sheet; (ix)
Exhibit A of Sub-Servicing Agreement 3 of 4
Mortgage Insurance certificate (if applicable); (x) initial escrow statement;
(xi) Mortgage Loan application; and (xii) appraisal of the Mortgaged Property.
Shifting Control Notice: Shifting Control Notice shall have the meaning assigned
to such term in the Blocked Account Control Agreement.
System: Computer hardware, software and firmware that is utilized or accessed by
Wendover in performing the Services.
Textron: Textron Financial Corporation.
Transfer Date: As to each Mortgage Loan, the date such Mortgage Loan is placed
on Wendover's System, such date to be determined solely by reference to
Wendover's records.
VA: The United States Department of Veterans Affairs.
VA Loan: A Mortgage Loan that is identified on the Mortgage Loan Schedule as
guaranteed by the VA.
Warehouse Lender: Any of Client's warehouse lenders, including Textron.
Wendover: Wendover Financial Services Corporation, as defined in the first
paragraph of this Agreement.
Exhibit A of Sub-Servicing Agreement 4 of 4
EXHIBIT B
(to Sub-Servicing Agreement)
ROLES AND RESPONSIBILITIES MATRIX
(To be Provided Separately)
[* 13 pages]
[*] Denotes confidential material omitted and filed separately with the
Securities and Exchange Commission pursuant to a request for confidential
treatment.
EXHIBIT C
(to Sub-Servicing Agreement)
FEES
As consideration for Wendover's performance hereunder, Client agrees to pay
Wendover the following fees in accordance with the terms and conditions set
forth in this Agreement, which fees are a combination of recurring monthly
charges, one-time charges, and miscellaneous charges as set forth below.
1. Recurring Monthly Charges.
(a) Monthly Sub-Servicing Fee. Beginning with the calendar month of
the Effective Date, and for each calendar month during the term of this
Agreement, Client agrees to pay Wendover, in addition to all other fees
described herein, a monthly sub-servicing fee (the "Monthly
Sub-Servicing Fee"), which will be the greater of (i) or (ii) below:
(i) the minimum monthly fee of Three Thousand Dollars
($3,000.00); or
(ii) the amount determined by multiplying the Per Loan Fee
indicated below by the Total Mortgage Loans Per Month*, as set
forth in the following chart:
---------------------------------------------
Per Loan Fee - Fixed Per Loan Fee -
Rate Adjustable Rate
---------------------------------------------
$7.50 $8.50
---------------------------------------------
* Total Mortgage Loans Per Month is calculated by adding (i) the number of
Mortgage Loans on the System at the beginning of the calendar month, and (ii)
the number of Mortgage Loans added to the System during that calendar month, and
(iii) other Mortgage Loans for which Wendover is providing Services even though
such Mortgage Loans have not yet been added to the System. For purposes of
calculating Total Mortgage Loans Per Month, a Mortgage Loan paid in full shall
remain on the System through the date that a lien release for such Mortgage Loan
has been prepared by Wendover and forwarded to the appropriate party.
(b) Delinquency Fee. In addition to the Monthly Sub-Servicing Fee
and applicable Loss Mitigation Fee described in subparagraph (e) below,
Client agrees to pay Wendover additional monthly fees for each Mortgage
Loan for which any payment by Mortgagor is at least thirty (30) days
past due, as follows:
(i) [*]; or
(ii) [*]; or
Exhibit C of Sub-Servicing Agreement 1 of 5
(iii) [*]
(c) Bankruptcy-related Fee. If bankruptcy services are reflected on
the Roles and Responsibilities Matrix as a Wendover responsibility,
Client agrees to pay Wendover, in addition to the Monthly Sub-Servicing
Fee, an additional monthly fee of [*] for each Mortgage Loan for which
the Mortgagor is in Bankruptcy during any part of the calendar month. A
Mortgage Loan will be considered in Bankruptcy upon receipt by Wendover
of written or verbal notice from any attorney, trustee-in-bankruptcy, or
other reasonably reliable source.
(d) Foreclosure-related Fee. If foreclosure services are reflected
on the Roles and Responsibilities Matrix as a Wendover responsibility,
Client agrees to pay Wendover, in addition to the Monthly Sub-Servicing
Fee and applicable Loss Mitigation Fee described in subparagraph (e)
below, an additional monthly fee of [*] for each Mortgage Loan that is
in Foreclosure during any part of the calendar month.
(e) Loss Mitigation Fee. If loss mitigation services are reflected
on the Roles and Responsibilities Matrix as a Wendover responsibility,
Client agrees to pay Wendover, in addition to the Monthly Sub-Servicing
Fee, and in addition to any applicable Delinquency or Foreclosure Fee,
(i) an additional monthly fee of [*] for each Mortgage Loan in Loss
Mitigation status for all or part of any calendar month, and (ii) the
following fees applicable to completed Loss Mitigation cases:
Completed Short Sale: [*]
Written Extended Forbearance Plan: [*]
Modification of existing note: [*]
Completed Deed in Lieu: [*]
Completed Partial Claim: [*]
(f) Real Estate Owned (REO)-related Fee. If REO services are
reflected on, Exhibit B, the Roles and Responsibilities Matrix as a
Wendover responsibility, Client agrees to pay Wendover, in addition to
the Monthly Sub-Servicing Fee and applicable loss mitigation fee
described in subparagraph (e) above, an additional monthly fee of [*]
for each Mortgage Loan that is in REO during any part of the calendar
month.
In addition, Wendover will be paid a marketing fee of [*] of the sales
price of each REO property, if Client elects to have Wendover perform
the marketing of the property. From this marketing fee, Wendover will be
responsible for payment of fees to any outsource vendor selected by
Wendover, as well as real estate commissions paid on the sale of the
property. The minimum marketing fee for each REO property will be [*].
Client will notify Wendover within ten (10) Business Days of Wendover's
notification of foreclosure sale of its intent to market the property.
Exhibit C of Sub-Servicing Agreement 2 of 5
2. One-Time Charges.
(a) [Waived per Xxxxxx Xxxxxx; /s/ GL 5/10/2003]
(b) Ongoing Set-Up Fee. For each Mortgage Loan that is added to
Wendover's System after the initial transfer of Client's portfolio,
Client agrees to pay Wendover a one-time Set-Up Fee, as follows: (i) for
Mortgage Loans that are transferred to the Wendover System by electronic
means, the Set-Up Fee will be [*]; and (ii) for Mortgage Loans that are
transferred to Wendover via "hard copy" files and manually loaded onto
the Wendover System, the Set-Up Fee will be [*].
(c) Mortgage Insurance Claim-related Fee. Client agrees to pay
Wendover [*] for each claim/expense reimbursement filed by Wendover on
Client's behalf.
(d) Mortgage Note Conversion Fee. Client agrees to pay Wendover (i)
[*] for each adjustable rate Mortgage Loan that is converted to a fixed
rate Mortgage Loan under the terms of the Mortgage Note; and (ii) [*]
for each non-escrow Mortgage Loan that is converted to an escrowed
Mortgage Loan.
(e) Client Sale Fee. Client agrees to pay Wendover a fee of [*] upon
the sale by the Client of any part of its interest in any Mortgage Loan
subject to this Agreement upon which sale this Agreement remains in
force and effect and is not terminated with respect to such Mortgage
Loan.
(f) Lien Release Fee. Client agrees to pay for all costs or fees
associated with preparing and processing the lien release and any
related documents (including any assignments of Mortgage necessary to
complete the lien release). Costs and fees associated with preparing and
processing the lien release and related documents shall include, without
limitation, the cost of title searches, custodial fees, and recording
fees; provided, however, that no such costs and fees shall be incurred
without prior written notice to the Client. Upon completion of lien
release of a Mortgage Loan, or extinguishing of the Mortgage Loan
through Foreclosure, Client agrees that Servicing Files will be shipped
at Client's expense.
(g) Deconversion Fee. Client agrees to pay Wendover, in addition to
all other amounts due hereunder, [*] as a deconversion fee for each
Mortgage Loan deconverted from Wendover's system for any reason other
than payment in full.
Exhibit C of Sub-Servicing Agreement 3 of 5
(h) Exit Fee. If this Agreement is terminated pursuant to Section
7.4 hereof, then Client agrees to pay to Wendover [*] at the time of the
notice of termination.
(i) Dial-In Alltel Access. If Client elects to purchase Dial-in
Access to the Wendover servicing system, Client agrees to pay Wendover,
in addition to the Monthly Sub-Servicing Fee, the following fees:
One-time setup fee (2 users) [*]
Setup fee for each additional user [*]
Monthly fee per user [*]
ALLTEL Transaction Charge [*]
Client will bear all communication costs.
(j) Fees for Other Services. In addition to all other fees set forth
herein, Client will pay Wendover for the fees set forth in Exhibit C.1
for (i) default property inspections; (ii) broker price options (BPOs);
(iii) appraisals; (iv) tax service; (v) flood determinations; (vi) title
searches; (vii) loss draft property inspections; and (viii) attorneys'
and trustees' services related to bankruptcy and foreclosure actions for
Mortgage Loans; provided, however, that the fees charged by and payable
to Wendover for GNMA-guaranteed Mortgage Loans, and (B) HUD-insured and
VA-guaranteed Mortgage Loans shall not exceed the applicable amounts
allowable under the applicable Agency Guidelines. All fees set forth in
Exhibit C.1 are subject to change upon thirty (30) days' prior written
notice.
4. Annual Adjustment to Fee. Unless otherwise expressly provided in this
Agreement with respect to the charges to be paid hereunder, the parties
acknowledge and agree to use the Employment Cost Index for Total
Compensation (not seasonally adjusted), Private Industry Workers,
White-collar occupations excluding sales, June 1989 = 100 (the "ECI"),
as the basis for annual adjustments to all charges to be paid by Client
to Wendover (the "Adjustable Charges"). The ECI is published by the
Bureau of Labor Statistics (the "BLS") of the U.S. Department of Labor.
For purposes of this Exhibit C, the most recently published ECI as of
any anniversary of the Effective Date is the "ECI Current Index", and
the "ECI Base Index" is the ECI Current Index from the prior anniversary
of the Effective Date (or, for the first anniversary, the ECI most
recently published as of the Effective Date). If, on any anniversary of
the Effective Date, the ECI Current Index is higher than the ECI Base
Index, then, effective as of such anniversary, an adjustment to the
Adjustable Charges will be made by increasing the Adjustable Charges by
the percentage that the ECI Current Index increased from the ECI Base
Index. In calculating the percentage increase, the parties agree to
round to one decimal place. If, on any anniversary of the Effective
Date, the ECI Current Index is lower than the ECI Base Index, no
adjustment to the Adjustable Charges will be made. If the period from
the ECI Base Index to the ECI Current Index is other than 12 months, an
adjustment to a full year will be pro-rated accordingly. If an
adjustment is not made on an anniversary date for any reason, then the
ECI Base Index for the following anniversary date will be the same as
the
Exhibit C of Sub-Servicing Agreement 4 of 5
ECI Base Index for the anniversary date on which no adjustment was made.
The parties acknowledge and agree that Wendover will adjust the
Adjustable Charges and will advise Client of such adjustment in writing
so that the new charges will amend this Agreement and become effective
on the applicable anniversary of the Effective Date.
Exhibit C of Sub-Servicing Agreement 5 of 5
EXHIBIT C.1
(to Sub-Servicing Agreement)
OTHER FEES
1. Default Property Inspection
Property Inspection $ [*]
Property Inspection Fee is for a basic property inspection in all states except
Alaska and Hawaii and excludes any additional fees such as Rush Fees or Photo
Fees, which will be invoiced separately.
2. Broker Price Option (BPO)
BPO Interior with photo $ [*]
BPO Interior without photo $ [*]
BPO Exterior with photo $ [*]
BPO Exterior without photo $ [*]
Mississippi Property Evaluation $ [*]
BPO Fees are for residential properties in all states except Alaska and Hawaii,
and exclude properties valued greater than $500,000, and Rural and Trip Charges,
which will be quoted as needed.
3. Appraisals
FNMA 1004 - Uniform Residential Full Appraisal $ [*]
Appraisal Report
FNMA 2055 Desktop Underwriter Limited Appraisal - Exterior $ [*]
Quantitative Analysis Appraisal Only
Report
Limited Appraisal
FNMA 2055 Desktop Underwriter Interior/Exterior $ [*]
Quantitative Analysis Appraisal
Report
Appraisal Fees are for residential properties in all states [*].
Exhibit C.1 of Sub-Servicing Agreement 1 of 4
4. Tax Service Fee
Tax Service Contract - life of loan, fully $ [*]
transferable within Transamerica
5. Flood Determination
Flood Determination life of loan, fully $ [*]
transferable within Transamerica
6. Title Search
Title Search to obtain recording information on $ [*]
paid in full loan
7. Loss Draft Property Inspections
Loss Draft Property Inspection $ [*]
24-hour rush fee - additional fee $ [*]
48-hour rush fee - additional fee $ [*]
8. Attorneys' and Trustees' Fees for Other Loan Types (All Loans Excluding
HUD-Insured and GNMA-Guaranteed and VA-Guaranteed Loans)
Nonjudicial Judicial Eviction Deed-in-Lieu Replevin
State Foreclosure Foreclosure Action Foreclosure Actions
-------- ------------ ----------- ------------ ------------ ---------------
AK [*] [*] [*] [*]
AL [*] [*] [*] [*] [*]
AR [*] [*] [*] [*] [*]
AZ [*] [*] [*] [*] [*]
CA [*] [*] [*] [*] [*]
CO [*] [*] [*] [*] [*]
CT [*] [*] [*] [*] [*]
DC [*] [*] [*] [*] [*]
DE [*] [*] [*] [*] [*]
FL [*] [*] [*] [*] [*]
GA [*] [*] [*] [*] [*]
GU [*] [*] [*] [*]
HI [*] [*] [*] [*]
IA [*] [*] [*] [*] [*]
ID [*] [*] [*] [*] [*]
IL [*] [*] [*] [*] [*]
IN [*] [*] [*] [*] [*]
Exhibit C.1 of Sub-Servicing Agreement 2 of 4
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KS [*] [*] [*] [*] [*]
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KY [*] [*] [*] [*] [*]
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LA [*] [*] [*] [*] [*]
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MA [*] [*] [*] [*] [*]
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MD [*] [*] [*] [*] [*]
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ME [*] [*] [*] [*] [*]
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MI [*] [*] [*] [*] [*]
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MN [*] [*] [*] [*] [*]
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MO [*] [*] [*] [*] [*]
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MS [*] [*] [*] [*] [*]
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MT [*] [*] [*] [*] [*]
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NC [*] [*] [*] [*] [*]
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ND [*] [*] [*] [*] [*]
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NE [*] [*] [*] [*] [*]
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NH [*] [*] [*] [*] [*]
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NJ [*] [*] [*] [*] [*]
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NM [*] [*] [*] [*] [*]
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NV [*] [*] [*] [*] [*]
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NY [*] [*] [*] [*] [*]
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OH [*] [*] [*] [*] [*]
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OK [*] [*] [*] [*] [*]
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OR [*] [*] [*] [*] [*]
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PA [*] [*] [*] [*] [*]
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PR [*] [*] [*] [*] [*]
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RI [*] [*] [*] [*] [*]
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SC [*] [*] [*] [*] [*]
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SD [*] [*] [*] [*] [*]
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TN [*] [*] [*] [*] [*]
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TX [*] [*] [*] [*] [*]
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UT [*] [*] [*] [*] [*]
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VA [*] [*] [*] [*] [*]
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VI [*] [*] [*] [*] [*]
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VT [*] [*] [*] [*] [*]
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WA [*] [*] [*] [*] [*]
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WI [*] [*] [*] [*] [*]
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WV [*] [*] [*] [*] [*]
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WY [*] [*] [*] [*] [*]
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1 [*]
2 [*]
3 [*]
4 [*]
5 [*]
6 [*]
7 [*]
8 [*]
9 [*]
10 [*]
Exhibit C.1 of Sub-Servicing Agreement 3 of 4
[*]
[*]
[*]
Exhibit C.1 of Sub-Servicing Agreement 4 of 4
EXHIBIT D
(to Sub-Servicing Agreement)
MATERIAL ASSUMPTIONS
- The term of the Agreement to be sixty-two (62) months
- Two (2) month period for conversion
- Three Hundred Fifty (350) Mortgage Loans will be converted July, 2003
- New loan flow will begin June, 2003
- During months 2 through 25 of the contract term, one hundred fifty (150) new
Mortgage Loans per month
- Mortgage Loans boarded in June, 2003 will be manually boarded
- Effective July, 2003, all Mortgage Loans will be electronically boarded
- No more than one thousand eighty (1,080) Mortgage Loans will be deconverted
in the first 26 months of the contract term.
- No more than eighteen percent (18%) of the Mortgage Loans will pay in full
in any calendar year
- The Agreement represents a standard Wendover offering - no private label
components
- No more than thirty percent (30%) of active Mortgage Loans will call
Wendover customer service
Exhibit D of Sub-Servicing Agreement 1 of 1
EXHIBIT E
(to Sub-Servicing Agreement)
MORTGAGE LOAN SCHEDULE
(To Be Provided Separately)
[* 9 pages]
Exhibit E of Sub-Servicing Agreement 1 of 1
EXHIBIT F
(to Sub-Servicing Agreement)
INTENTIONALLY OMITTED
Exhibit F of Sub-Servicing Agreement 1 of 1
EXHIBIT G
(to Sub-Servicing Agreement)
DISPUTE RESOLUTION PROCEDURES
G.1 Mediation. Any Dispute that the parties are unable to resolve through
informal discussions or negotiations pursuant to Article VI of this
Agreement will be submitted to non-binding mediation, which will be held
in Plano, Texas if initiated by Client and in a location of Client's
election if initiated by Wendover. The parties will mutually determine
who the mediator will be from a list of mediators obtained from the
American Arbitration Association office located in the city in which the
proceeding will take place, determined as set forth above (the "AAA").
If the parties are unable to agree on the mediator, the mediator will be
selected by the AAA.
G.2 Arbitration. Any Dispute that the parties are unable to resolve through
mediation pursuant to Section G.1 of this Exhibit will be submitted to
arbitration in accordance with the following procedures:
(a) Demand for Arbitration; Location. Either party may demand
arbitration by giving the other party written notice to such
effect, which notice will describe, in reasonable detail, the
facts and legal grounds forming the basis for the filing party's
request for relief and will include a statement of the total
amount of damages claimed, if any, and any other remedy sought
by that party. The arbitration will be held before one neutral
arbitrator in Plano, Texas if the proceedings are initiated by
Client and in a location of Client's election if the proceedings
are initiated by Wendover.
(b) Identification of Arbitrator. Within thirty (30) days after the
other party's receipt of such demand, the parties will mutually
determine who the arbitrator will be. If the parties are unable
to agree on the arbitrator within that time period, the
arbitrator will be selected by the AAA. In any event, the
arbitrator will have a background in, and knowledge of, the
information technology services industry and will be an
appropriate person based on the nature of the Dispute. If a
person with such industry experience is not available, the
arbitrator will be chosen from the large and complex case panel
or, if an appropriate person is not available from such panel,
the retired federal judges pool.
(c) Conduct of Arbitration. The arbitration will be governed by the
Commercial Arbitration Rules of the AAA, except as expressly
provided in this Section G.2. However, the arbitration will be
administered by any organization mutually agreed to in writing
by the parties. If the parties are unable to agree on the
organization to administer the arbitration, it will be
administered by the AAA under its procedures for large and
complex cases. Pending the arbitrator's determination of the
merits of
Exhibit G of Sub-Servicing Agreement 1 of 2
the Dispute, either party may apply to any court of competent
jurisdiction to seek injunctive or other extraordinary relief.
(d) Scope of Discovery. Discovery will be limited to the request for
and production of documents, depositions and interrogatories.
Interrogatories will be allowed only as follows: a party may
request the other party to identify by name, last known address
and telephone number (i) all persons having knowledge of facts
relevant to the Dispute and a brief description of that person's
knowledge, (ii) any experts who may be called as an expert
witness, the subject matter about which the expert is expected
to testify, the mental impressions and opinions held by the
expert and the facts known by the expert (regardless of when the
factual information was acquired) which relate to or form the
basis for the mental impressions and opinions held by the expert
and (iii) any experts who have been used for consultation, but
who are not expected to be called as an expert witness, if such
consulting expert's opinions or impressions have been reviewed
by an expert witness. All discovery will be guided by the
Federal Rules of Civil Procedure. All issues concerning
discovery upon which the parties cannot agree will be submitted
to the arbitrator for determination.
(e) Authority of Arbitrator. In rendering an award, the arbitrator
will determine the rights and obligations of the parties
according to the substantive and procedural laws of the State of
North Carolina. The arbitrator will not have authority to award
damages in excess of the amount or other than the types allowed
by Article VI and may not, in any event, make any ruling,
finding or award that does not conform to the terms and
conditions of this Agreement.
(f) Joinder of parties. Each of Wendover and Client agree that it
will use commercially reasonable efforts to join (and will allow
the other party to join) any third party that the parties have
agreed is indispensable to the arbitration. If any such third
party does not agree to be joined, the arbitration will proceed
nonetheless.
(g) Award. The decision of, and award rendered by, the arbitrator
will be final and binding on the parties. Upon the request of a
party, the arbitrator's award will include written findings of
fact and conclusions of law. Judgment on the award may be
entered in and enforced by any court of competent jurisdiction.
Each party will bear its own costs and expenses (including
filing fees) with respect to the arbitration, including one-half
of the fees and expenses of the arbitrator.
Exhibit G of Sub-Servicing Agreement 2 of 2
EXHIBIT H
(to Sub-Servicing Agreement)
DATA ACCESS PROCEDURES
The databases, computer programs, screen formats, screen designs, report
formats, interactive design techniques, and other information furnished to
Client by Wendover as part of the Services constitute copyrighted, trade secret
or proprietary information of substantial value to Wendover. Such databases,
programs and other information are collectively referred to below as "Wendover
Information". Client agrees that it will treat all Wendover Information as
proprietary to Wendover and that it will not divulge any Wendover Information to
any person or organization except as is expressly permitted hereunder. Wendover
Information is furnished "as is" without warranty. Without limiting the
foregoing Client agrees for itself and its employees and agents to:
(i) Access data and functions solely for Client's own internal use
and benefit;
(ii) Discontinue use of the data access security system at any time
upon notice from Wendover;
(iii) Upon Wendover's request, cause Client's internal auditors to
certify in writing to Wendover that data access is restricted to
Client's authorized employees;
(iv) use such programs and databases solely (1) on Wendover's System
or designated Client devices, (2) from devices at Client
locations approved in writing by Wendover, and (3) in accordance
with Wendover's applicable user documentation;
(v) refrain from copying or duplicating in any way (other than in
the normal course of performing processing on Wendover's
computers) any part of any Wendover Information, and to return
any Wendover Information upon termination of this Agreement;
(vi) refrain from obtaining unauthorized access to any programs, data
or other information to which Client is not entitled, and if
such access is accidentally obtained, to respect and safeguard
the same as Wendover Information;
(vii) refrain from causing or allowing information transmitted from
Wendover's computer to Client's terminal to be transmitted to
another computer, terminal or other device for other than
Client's own use, except upon prior written approval of
Wendover;
(viii) honor all reasonable written requests made by Wendover to
protect at Wendover's expense the rights of Wendover in Wendover
Information at common law, under the Federal copyright statute
and under other Federal and state statutes;
Exhibit H of Sub-Servicing Agreement 1 of 2
(ix) request, issue and maintain a unique user ID for each Client
employee, which request must be made in writing to Wendover's
designated data security manager;
(x) request immediate deactivation of a user ID or deletion of
access when no longer needed or when Client believes security
has been violated;
(xi) limit knowledge of user IDs and passwords to only authorized
Client employees;
(xii) not (1) disclose passwords directly or indirectly to anyone,
including other employees of Client, or (2) store user IDs or
passwords in any computer file, as part of an "automatic logon"
procedure, or (3) recycle or reuse passwords; and
(xiii) change the password every thirty (30) days, or when Client
believes the password might have become known to others, or when
Client suspects a possible security violation.
Exhibit H of Sub-Servicing Agreement 2 of 2
