MASTER MORTGAGE LOAN PURCHASE AND INTERIM SERVICING AGREEMENT NC CAPITAL CORPORATION Seller NEW CENTURY MORTGAGE CORPORATION Interim Servicer CITIGROUP GLOBAL MARKETS REALTY CORP. Initial Purchaser Dated as of March 1, 2006 First and Second Lien,...
NC
CAPITAL CORPORATION
Seller
NEW
CENTURY MORTGAGE CORPORATION
Interim
Servicer
CITIGROUP
GLOBAL MARKETS REALTY CORP.
Initial
Purchaser
Dated
as
of March 1, 2006
First
and
Second Lien, Fixed and Adjustable Rate Mortgage Loans
TABLE
OF
CONTENTS
|
SECTION
1.
|
Definitions
|
|
SECTION
2.
|
Agreement
to Purchase
|
|
SECTION
3.
|
Mortgage
Loan Schedules
|
|
SECTION
4.
|
Purchase
Price
|
|
SECTION
5.
|
Examination
of Mortgage Files
|
|
SECTION
6.
|
Conveyance
from Seller to Initial Purchaser.
|
Subsection
6.01. Conveyance
of Mortgage Loans; Possession of Servicing Files.
Subsection
6.02. Books
and
Records.
Subsection
6.03. Delivery
of Mortgage Loan Documents.
|
SECTION
7.
|
Representations,
Warranties and Covenants of the Seller: Remedies for
Breach.
|
Subsection
7.01. Representations
and Warranties Respecting the Seller
Subsection
7.02. Representations
and Warranties Regarding Individual Mortgage Loans.
Subsection
7.03. Remedies
for Breach of Representations and Warranties.
Subsection
7.04. Repurchase
of Certain Mortgage Loans.
|
SECTION
8.
|
Closing
|
|
SECTION
9.
|
Closing
Documents.
|
|
SECTION
10.
|
Costs
|
|
SECTION
11.
|
Seller's
Servicing Obligations
|
|
SECTION
12.
|
Removal
of Mortgage Loans from Inclusion under This Agreement Upon a Whole
Loan
Transfer or a Securitization Transaction on One or More Reconstitution
Dates.
|
|
SECTION
13.
|
COMPLIANCE
WITH REGULATION AB
|
Subsection
13.01. Intent
of
the Parties; Reasonableness.
Subsection
13.02. Additional
Representations and Warranties of the Seller.
Subsection
13.03. Information
to Be Provided by the Seller.
Subsection
13.04. Servicer
Compliance Statement.
Subsection
13.05. Report
on
Assessment of Compliance and Attestation.
Subsection
13.06. Use
of
Subservicers and Subcontractors.
Subsection
13.07. Indemnification;
Remedies.
|
SECTION
14.
|
The
Seller.
|
Subsection
14.01. Additional
Indemnification by the Seller.
Subsection
14.02. Merger
or
Consolidation of the Seller.
Subsection
14.03. Limitation
on Liability of the Seller and Others.
Subsection
14.04. Seller
Not to Resign.
Subsection
14.05. No
Transfer of Servicing.
|
SECTION
15.
|
DEFAULT.
|
Subsection
15.01. Events
of
Default.
Subsection
15.02. Waiver
of
Defaults.
|
SECTION
16.
|
Termination
|
|
SECTION
17.
|
Successor
to the Seller
|
|
SECTION
18.
|
Financial
Statements
|
|
SECTION
19.
|
Mandatory
Delivery: Grant of Security Interest
|
|
SECTION
20.
|
Notices
|
|
SECTION
21.
|
Severability
Clause
|
|
SECTION
22.
|
Counterparts
|
|
SECTION
23.
|
GOVERNING
LAW; SUBMISSION TO JURISDICTION
|
|
SECTION
24.
|
Intention
of the Parties
|
|
SECTION
25.
|
Successors
and Assigns
|
|
SECTION
26.
|
Waivers
|
|
SECTION
27.
|
Exhibits
|
|
SECTION
28.
|
Nonsolicitation
|
|
SECTION
29.
|
General
Interpretive Principles
|
|
SECTION
30.
|
Reproduction
of Documents
|
|
SECTION
31.
|
Further
Agreements
|
|
SECTION
32.
|
Entire
Agreement.
|
EXHIBITS
|
EXHIBIT
1
|
SELLER’S
OFFICER’S CERTIFICATE
|
|
EXHIBIT
2
|
FORM
OF OPINION OF COUNSEL TO THE SELLER
|
|
EXHIBIT
3
|
SECURITY
RELEASE CERTIFICATION
|
|
EXHIBIT
4
|
ASSIGNMENT
AND CONVEYANCE
|
|
EXHIBIT
5
|
CONTENTS
OF EACH MORTGAGE FILE
|
|
EXHIBIT
6
|
MORTGAGE
LOAN DOCUMENTS
|
|
EXHIBIT
7
|
FORM
OF CUSTODIAL ACCOUNT LETTER AGREEMENT
|
|
EXHIBIT
8
|
FORM
OF ESCROW ACCOUNT LETTER AGREEMENT
|
|
EXHIBIT
9
|
SERVICING
ADDENDUM
|
|
EXHIBIT
10
|
FORM
OF ASSIGNMENT AND RECOGNITION AGREEMENT
|
|
EXHIBIT
11
|
FORM
OF INDEMNIFICATION AGREEMENT
|
|
EXHIBIT
12
|
FORM
OF BACK-UP CERTIFICATION
|
|
EXHIBIT
13
|
FORM
OF REMITTANCE REPORT
|
|
EXHIBIT
14
|
FORM
OF ANNUAL CERTIFICATION
|
|
EXHIBIT
15
|
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
|
|
SCHEDULE
I
|
MORTGAGE
LOAN SCHEDULE
|
This
is a
MASTER MORTGAGE LOAN PURCHASE AND INTERIM SERVICING AGREEMENT (the “Agreement”),
dated as of March 1, 2006, by and between CITIGROUP
GLOBAL MARKETS REALTY CORP.,
having
an office at 000 Xxxxxxxxx Xxxxxx, 0xx
Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000 (the “Initial Purchaser”, and the Initial Purchaser or
the Person, if any, to which the Initial Purchaser has assigned its rights
and
obligations hereunder as Purchaser with respect to a Mortgage Loan, and each
of
their respective successors and assigns, the “Purchaser”), NC CAPITAL
CORPORATION, having an office at 00000 Xxx Xxxxxx, Xxxxx 0000, Xxxxxx,
Xxxxxxxxxx 00000 (the “Seller”) and NEW CENTURY MORTGAGE CORPORATION, having an
office at 00000 Xxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxxxx 00000 (the “Interim
Servicer”).
W I T N E S S E T H
:
WHEREAS,
the Seller desires to sell, from time to time, to the Initial Purchaser, and
the
Initial Purchaser desires to purchase, from time to time, from the Seller,
certain conventional fixed and adjustable rate residential first and second
lien
mortgage loans, including the right to any Prepayment Charges payable by the
related Mortgagors, (the “Mortgage Loans”) as described herein on a
servicing-released basis, and which shall be delivered in groups of whole loans
on various dates as provided herein (each, a “Closing Date”);
WHEREAS,
each Mortgage Loan is secured by a mortgage, deed of trust or other security
instrument creating a first or second lien on a residential dwelling located
in
the jurisdiction indicated on the Mortgage Loan Schedule for the related
Mortgage Loan Package, which is to be annexed hereto on each Closing Date as
Schedule
I;
WHEREAS,
the Initial Purchaser and the Seller wish to prescribe the manner of the
conveyance, interim servicing and control of the Mortgage Loans;
and
WHEREAS,
following its purchase of the Mortgage Loans from the Seller, the Purchaser
desires to sell some or all of the Mortgage Loans to one or more purchasers
as a
whole loan transfer in a whole loan or participation format or a public or
private mortgage-backed securities transaction;
NOW,
THEREFORE, in consideration of the premises and mutual agreements set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Purchaser and the Seller
agree
as follows:
SECTION
1. Definitions.
For
purposes of this Agreement the following capitalized terms shall have the
respective meanings set forth below.
Accepted
Servicing Practices:
With
respect to any Mortgage Loan, those mortgage servicing practices (including
collection procedures) of prudent mortgage banking institutions which service
mortgage loans of the same type as such Mortgage Loan in the jurisdiction where
the related Mortgaged Property is located, which are in accordance with Xxxxxx
Xxx servicing practices and procedures for MBS pool mortgages, as defined in
the
Xxxxxx Mae Guides including future updates, the terms of the Mortgage Loan
Documents and all applicable federal, state and local legal and regulatory
requirements.
Adjustable
Rate Mortgage Loan:
A
Mortgage Loan which provides for the adjustment of the Mortgage Interest Rate
payable in respect thereto.
Adjustment
Date:
With
respect to each Adjustable Rate Mortgage Loan, the date set forth in the related
Mortgage Note on which the Mortgage Interest Rate on such Adjustable Rate
Mortgage Loan is adjusted in accordance with the terms of the related Mortgage
Note.
Agreement:
This
Master Mortgage Loan Purchase and Interim Servicing Agreement including all
exhibits, schedules, amendments and supplements hereto.
Appraised
Value:
With
respect to any Mortgaged Property, the lesser of (i) the value thereof as
determined by an appraisal made for the originator of the Mortgage Loan at
the
time of origination of the Mortgage Loan by an appraiser who met the minimum
requirements of Xxxxxx Xxx and Xxxxxxx Mac and the Financial Institutions
Reform, Recovery, and Enforcement Act of 1989, and (ii) the purchase price
paid
for the related Mortgaged Property by the Mortgagor with the proceeds of the
Mortgage Loan, provided, however, in the case of a Refinanced Mortgage Loan,
such value of the Mortgaged Property is based solely upon the value determined
by an appraisal made for the originator of such Refinanced Mortgage Loan at
the
time of origination of such Refinanced Mortgage Loan by an appraiser who met
the
minimum requirements of Xxxxxx Mae and Xxxxxxx Mac and the Financial
Institutions Reform, Recovery, and Enforcement Act of 1989.
Assignment
and Conveyance:
An
assignment and conveyance of the Mortgage Loans purchased on a Closing Date
in
the form annexed hereto as Exhibit 4.
Assignment
of Mortgage:
With
respect to each Mortgage Loan which is not a MERS Loan, an individual assignment
of the Mortgage, notice of transfer or equivalent instrument in recordable
form,
sufficient under the laws of the jurisdiction wherein the related Mortgaged
Property is located to give record notice of the sale of the Mortgage to the
Purchaser.
Balloon
Mortgage Loan:
A
Mortgage Loan that provided on the date of origination for an amortization
schedule extending beyond its maturity date.
Balloon
Payment:
With
respect to any Balloon Mortgage Loan as of any date of determination, the
Monthly Payment payable on the maturity of such Mortgage Loan.
Business
Day:
Any day
other than a Saturday or Sunday, or a day on which banking and savings and
loan
institutions in the State of California or the State of New York are authorized
or obligated by law or executive order to be closed.
Cash-Out
Refinancing:
A
Refinanced Mortgage Loan the proceeds of which were in excess of the principal
balance of any existing first mortgage on the related Mortgaged Property and
related closing costs, and were used to pay any such existing first mortgage,
related closing costs, subordinate mortgages on the related Mortgaged Property,
unsecured debts of the Mortgagor or provide cash to the Mortgagor.
Closing
Date:
The
date or dates on which the Initial Purchaser from time to time shall purchase
and the Seller from time to time shall sell to the Initial Purchaser, the
Mortgage Loans listed on the related Mortgage Loan Schedule with respect to
the
related Mortgage Loan Package.
Closing
Documents:
With
respect to any Closing Date, the documents required pursuant to
Section 9.
Code:
The
Internal Revenue Code of 1986, or any successor statute thereto.
Combined
Loan-to-Value Ratio or CLTV: With
respect to any Mortgage Loan as of any date of determination, the ratio on
such
date of the outstanding principal amount of the Mortgage Loan and any other
mortgage loan which is secured by a lien on the related Mortgaged Property
to
the Appraised Value of the Mortgaged Property.
Commission:
The
United States Securities and Exchange Commission.
Condemnation
Proceeds:
All
awards, compensation and settlements in respect of a taking of all or part
of a
Mortgaged Property by exercise of the power of condemnation or the right of
eminent domain.
Confirmation:
With
respect to any Mortgage Loan Package purchased and sold on any Closing Date,
the
letter agreement between the Initial Purchaser and the Seller (including any
exhibits, schedules and attachments thereto), setting forth the terms and
conditions of such transaction and describing the Mortgage Loans to be purchased
by the Initial Purchaser on such Closing Date. A Confirmation may relate to
more
than one Mortgage Loan Package to be purchased on one or more Closing Dates
hereunder.
Convertible
Mortgage Loan:
A
Mortgage Loan that by its terms and subject to certain conditions contained
in
the related Mortgage or Mortgage Note allows the Mortgagor to convert the
adjustable Mortgage Interest Rate on such Mortgage Loan to a fixed Mortgage
Interest Rate.
Credit
Score:
With
respect to any Mortgage Loan, the credit score of the related Mortgagor provided
by Fair, Xxxxx & Company, Inc., Equifax,
Experian or Trans Union Credit Information Company
at the
time of the origination of such Mortgage Loan. If two credit scores are
obtained, the Credit Score shall be the lower of the two credit scores. If
three
credit scores are obtained, the Credit Score shall be the middle of the three
credit scores.
Custodial
Account:
The
separate account or accounts, each of which shall be an Eligible Account,
created and maintained pursuant to this Agreement, which shall be entitled
“New
Century Mortgage Corporation, as servicer, in trust for the Purchaser, Fixed
and
Adjustable Rate Mortgage Loans”, established at a financial institution
acceptable to the Purchaser. Each Custodial Account shall be an Eligible
Account.
Custodial
Agreement:
The
agreement governing the retention of the originals of each Mortgage Note,
Mortgage, Assignment of Mortgage and other Mortgage Loan Documents.
Custodian:
The
custodian under the Custodial Agreement, or its successor in interest or
assigns, or any successor to the Custodian under the Custodial Agreement, as
therein provided.
Cut-off
Date:
The
first day of the month in which the related Closing Date occurs or such other
date mutually agreed upon by the Seller and the Initial Purchaser as set forth
in the related Confirmation.
Deleted
Mortgage Loan:
A
Mortgage Loan replaced or to be replaced by a Qualified Substitute Mortgage
Loan.
Depositor:
The
depositor, as such term is defined in Regulation AB, with respect to any
Securitization Transaction.
Determination
Date:
With
respect to each Distribution Date, the fifteenth (15th) day of the calendar
month in which such Distribution Date occurs or, if such fifteenth (15th) day
is
not a Business Day, the Business Day immediately preceding such fifteenth (15th)
day.
Distribution
Date:
The
eighteenth (18th) day of each month, commencing on the eighteenth day of the
month next following the month in which the related Cut-off Date occurs, or
if
such eighteenth (18th) day is not a Business Day, the first Business Day
immediately preceding such eighteenth (18th) day.
Due
Date:
With
respect to each Mortgage Loan, the day of the calendar month on which each
Monthly Payment is due on such Mortgage Loan (including the Balloon Payment
with
respect to a Balloon Mortgage Loan), exclusive of any days of
grace.
Eligible
Account:
Either
(i) an account or accounts maintained with a federal or state chartered
depository institution or trust company the short-term unsecured debt
obligations of which (or, in the case of a depository institution or trust
company that is the principal subsidiary of a holding company, the short-term
unsecured debt obligations of such holding company) are rated A-1 by S&P or
Prime-1 by Moody's (or a comparable rating if another rating agency is specified
by the Initial Purchaser by written notice to the Seller) at the time any
amounts are held on deposit therein, (ii) an account or accounts the deposits
in
which are fully insured by the FDIC or (iii) a trust account or accounts
maintained with a federal or state chartered depository institution or trust
company acting in its fiduciary capacity. Eligible Accounts may bear
interest.
Escrow
Account:
The
separate trust account or accounts created and maintained pursuant to this
Agreement which shall be entitled “New Century Mortgage Corporation, as
servicer, in trust for the Purchaser and various Mortgagors, Fixed and
Adjustable Rate Mortgage Loans”, established at a financial institution
acceptable to the Purchaser. Each Escrow Account shall be an Eligible
Account.
Escrow
Payments:
The
amounts constituting ground rents, taxes, assessments, water charges, sewer
rents, fire and hazard insurance premiums and other payments required to be
escrowed by the Mortgagor with the Mortgagee pursuant to the terms of any
Mortgage Note or Mortgage.
Event
of Default:
Any one
of the events enumerated in Subsection 15.01.
Exchange
Act:
The
Securities Exchange Act of 1934, as amended.
Xxxxxx
Mae:
Xxxxxx
Xxx or any successor thereto.
Xxxxxx
Mae Guide(s):
The
Xxxxxx Xxx Selling Guide and the Xxxxxx Mae Servicing Guide and all amendments
or additions thereto.
FDIC:
The
Federal Deposit Insurance Corporation, or any successor thereto.
Final
Recovery Determination:
With
respect to any defaulted Mortgage Loan or any REO Property (other than a
Mortgage Loan or REO Property purchased by the Seller pursuant to this
Agreement), a determination made by the Seller that all Insurance Proceeds,
Liquidation Proceeds and other payments or recoveries which the Seller, in
its
reasonable good faith judgment, expects to be finally recoverable in respect
thereof have been so recovered. The Seller shall maintain records, prepared
by a
servicing officer of the Seller, of each Final Recovery
Determination.
Fixed
Rate Mortgage Loan:
A
Mortgage Loan with respect to which the Mortgage Interest Rate set forth in
the
Mortgage Note is fixed for the term of such Mortgage Loan.
Flood
Zone Service Contract:
A
transferable contract maintained for the Mortgaged Property with a nationally
recognized flood zone service provider for the purpose of obtaining the current
flood zone status relating to such Mortgaged Property.
Xxxxxxx
Mac:
Xxxxxxx
Mac or any successor thereto.
Gross
Margin:
With
respect to any Adjustable Rate Mortgage Loan, the fixed percentage amount set
forth in the related Mortgage Note and the related Mortgage Loan Schedule that
is added to the Index on each Adjustment Date in accordance with the terms
of
the related Mortgage Note to determine the new Mortgage Interest Rate for such
Mortgage Loan.
HUD:
The
United States Department of Housing and Urban Development or any successor
thereto.
IO
Mortgage Loan:
A
Mortgage Loan that provides for monthly payments of interest only for a period
of time.
Index:
With
respect to any Adjustable Rate Mortgage Loan, the index identified on the
Mortgage Loan Schedule and set forth in the related Mortgage Note for the
purpose of calculating the interest rate thereon.
Initial
Closing Date:
The
Closing Date on which the Initial Purchaser purchases and the Seller sells
the
first Mortgage Loan Package hereunder.
Initial
Purchaser:
Citigroup Global Markets Realty Corp., or any successor.
Insurance
Proceeds:
With
respect to each Mortgage Loan, proceeds of insurance policies insuring the
Mortgage Loan or the related Mortgaged Property.
Interim
Servicing Period:
With
respect to any Mortgage Loan, the period commencing on the related Closing
Date
and ending on the date specified in the related Confirmation; provided, however
that the Interim Servicing Period may be extended for additional periods of
thirty days upon delivery by Purchaser of written notice to the Interim Servicer
at least twenty (20) days or within such other reasonable amount of time before
(i) the expiration of the initial Interim Servicing Period, or (ii) any
additional thirty (30) day extension of the Interim Servicing Period, provided
that in no event shall the Interim Servicing Period extend into any
Securitization Transaction.
Liquidation
Proceeds:
Amounts, other than Insurance Proceeds and Condemnation Proceeds, received
in
connection with the liquidation of a defaulted Mortgage Loan through trustee's
sale, foreclosure sale or otherwise, other than amounts received following
the
acquisition of REO Property.
Loan-to-Value
Ratio
or
LTV:
With
respect to any Mortgage Loan as of any date of determination, the ratio on
such
date of the outstanding principal amount of the Mortgage Loan to the Appraised
Value of the Mortgaged Property.
Master
Servicer:
With
respect to any Securitization Transaction, the “master servicer”, if any,
specified by the Purchaser and identified in the related transaction
documents.
Maximum
Mortgage Interest Rate:
With
respect to each Adjustable Rate Mortgage Loan, a rate that is set forth on
the
related Mortgage Loan Schedule and in the related Mortgage Note and is the
maximum interest rate to which the Mortgage Interest Rate on such Mortgage
Loan
may be increased on any Adjustment Date.
MERS:
Mortgage Electronic Registration Systems, Inc., a corporation organized and
existing under the laws of the State of Delaware, or any successor
thereto.
MERS®
System:
The
system of recording transfers of Mortgages electronically maintained by
MERS.
MIN:
The
Mortgage Identification Number of Mortgage Loans registered with MERS on the
MERS® System.
Minimum
Mortgage Interest Rate:
With
respect to each Adjustable Rate Mortgage Loan, a rate that is set forth on
the
related Mortgage Loan Schedule and in the related Mortgage Note and is the
minimum interest rate to which the Mortgage Interest Rate on such Mortgage
Loan
may be decreased on any Adjustment Date.
MOM
Loan:
Any
Mortgage Loan where MERS acts as the mortgagee of record of such Mortgage Loan,
solely as nominee for the originator of such Mortgage Loan and its successors
and assigns, at the origination thereof.
Monthly
Payment:
With
respect to any Mortgage Loan, the scheduled combined payment of principal and
interest (including any Balloon Payment), or, with respect to IO Mortgage Loan,
the scheduled monthly payment of interest only, payable by a Mortgagor under
the
related Mortgage Note on each Due Date.
Moody's:
Xxxxx'x
Investors Service, Inc. or its successor in interest.
Mortgage:
The
mortgage, deed of trust or other instrument creating a first or second lien
on
Mortgaged Property securing the Mortgage Note.
Mortgage
File:
The
items pertaining to a particular Mortgage Loan referred to in Exhibit
5
annexed
hereto, and any additional documents required to be added to the Mortgage File
pursuant to this Agreement or the related Confirmation.
Mortgage
Interest Rate:
With
respect to each Fixed Rate Mortgage Loan, the fixed annual rate of interest
provided for in the related Mortgage Note and, with respect to each Adjustable
Rate Mortgage Loan, the annual rate that interest accrues on such Adjustable
Rate Mortgage Loan from time to time in accordance with the provisions of the
related Mortgage Note.
Mortgage
Loan:
Each
first or second lien, residential mortgage loan, sold, assigned and transferred
to the Purchaser pursuant to this Agreement and the related Confirmation and
identified on the Mortgage Loan Schedule annexed to this Agreement on such
Closing Date, which Mortgage Loan includes without limitation the Mortgage
File,
the Monthly Payments, Principal Prepayments (including any Prepayment Charges),
Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds, REO Disposition
proceeds, and all other rights, benefits, proceeds and obligations arising
from
or in connection with such Mortgage Loan.
Mortgage
Loan Documents:
The
documents listed on Exhibit 6 to this Agreement pertaining to any Mortgage
Loan.
Mortgage
Loan Package:
The
Mortgage Loans listed on a Mortgage Loan Schedule, delivered to the Custodian
and the Initial Purchaser at least five (5) Business Days prior to the related
Closing Date and attached to this Agreement as Schedule
I
on the
related Closing Date.
Mortgage
Loan Schedule:
With
respect to each Mortgage Loan Package, the schedule of Mortgage Loans to be
annexed hereto as Schedule
I
(or a
supplement thereto) on each Closing Date for the Mortgage Loan Package delivered
on such Closing Date in both hard copy and in electronic format acceptable
to
the Seller and Purchaser, such schedule setting forth the following information
with respect to each Mortgage Loan in the Mortgage Loan Package: (1) the
Seller's Mortgage Loan identifying number; (2) the Mortgagor's first and last
name; (3) the street address of the Mortgaged Property including the city,
state
and zip code; (4) the original months to maturity; (5) the stated maturity
date;
(6) the original principal amount of the Mortgage Loan and with respect to
second liens the related first lien on the Mortgaged Property; (7) the Stated
Principal Balance of the Mortgage Loan and with respect to second liens the
principal balance of the related first lien on the Mortgaged Property as of
the
close of business on the Cut-off Date; (8) the original date of the Mortgage
Note (9) the date on which the first Monthly Payment was due on the Mortgage
Loan and, if such date is not consistent with the Due Date currently in effect,
such Due Date; (10) the Mortgage Interest Rate at origination; (11) the Mortgage
Interest Rate in effect immediately following the Cut-off Date; (12)
[Reserved]; (13)
the
Net Mortgage Rate as of the Cut-off Date; (14) the amount of the Monthly Payment
at origination and as of the Cut-off Date; (15) the last Due Date on which
a
Monthly Payment was actually applied to the unpaid Stated Principal Balance;
(16) a code indicating whether the Mortgage Loan is an Adjustable Rate Mortgage
Loan or a Fixed Rate Mortgage Loan; (17) with respect to each Adjustable Rate
Mortgage Loan, the initial Adjustment Date; (18) with respect to each Adjustable
Rate Mortgage Loan, the Gross Margin; (19) with respect to each Adjustable
Rate
Mortgage Loan, the Maximum Mortgage Interest Rate under the terms of the
Mortgage Note; (20) [Reserved]; (21) with respect to each Adjustable Rate
Mortgage Loan, the Periodic Rate Cap; (22) with respect to each Adjustable
Rate
Mortgage Loan, the first Adjustment Date immediately following the Cut-off
Date;
(23) [with respect to each Adjustable Rate Mortgage Loan, the Index;] (24)
a
code indicating the purpose of the loan (i.e., purchase financing, Rate/Term
Refinancing, Cash-Out Refinancing); (25) a code indicating the documentation
style; (26) a code indicating the occupancy status of the Mortgaged Property
(i.e., owner-occupied, second home or investor property); (27) the type of
Residential Dwelling constituting the Mortgaged Property (including the number
of units if the Residential Dwelling is a two- to four-family
property); (28)
product type (i.e. fixed, adjustable, 3/1, 5/1, etc.); (29) the debt-to-income
ratio of the related Mortgagor at the time of origination of the Mortgage
Loan;
(30) a
code indicating the Credit Score of the Mortgagor at the time of origination
of
the Mortgage Loan; (31)
the
Appraised Value of the Mortgaged Property and Appraisal Review Value; (32)
the
sale price of the Mortgaged Property, if applicable; (33) the Loan-to-Value
Ratio and Combined Loan-to-Value Ratio, if applicable, at origination; (34)
a
code indicating whether the Mortgage Loan is subject to a Prepayment Charge;
(35) the original term of any Prepayment Charge; (36), if applicable, a code
indicating whether any Prepayment Charge is required to be paid only upon the
refinancing of the related Mortgage Loan (i.e., a “soft prepayment charge”) or
upon the sale of the related Mortgaged Property or any other prepayment in
full
of the related Mortgage Loan (i.e., a “hard prepayment charge”); (37) [Reserved]
(38) [Reserved]; (39) a code indicating if the Mortgage Loan is an interest-only
Mortgage Loan and, if so, the term of the interest-only period of such Mortgage
Loan; and (40) a code indicating whether the Mortgage Loan is a first or second
lien. With respect to the Mortgage Loan Package in the aggregate, the Mortgage
Loan Schedule shall set forth the following information, as of the related
Cut-off Date: (1) the number of Mortgage Loans; (2) the current principal
balance of the Mortgage Loans; and (3) the weighted average Mortgage Interest
Rate of the Mortgage Loans. Schedule
I
hereto
shall be supplemented as of each Closing Date to reflect the addition of the
Mortgage Loan Schedule with respect to the related Mortgage Loan
Package.
Mortgage
Note:
The
original executed note or other evidence of the Mortgage Loan indebtedness
of a
Mortgagor.
Mortgaged
Property:
The
Mortgagor's real property securing repayment of a related Mortgage Note,
consisting of a fee simple interest in a single parcel of real property improved
by a Residential Dwelling.
Mortgagee:
The
mortgagee or beneficiary named in the Mortgage and the successors and assigns
of
such mortgagee or beneficiary.
Mortgagor:
The
obligor on a Mortgage Note, the owner of the Mortgaged Property and the grantor
or mortgagor named in the related Mortgage and such grantor's or mortgagor's
successor's in title to the Mortgaged Property.
Negative
Amortization:
With
respect to each Negative Amortization Mortgage Loan, that portion of interest
accrued at the Mortgage Interest Rate in any month which exceeds the Monthly
Payment on the related Mortgage Loan for such month and which, pursuant to
the
terms of the Mortgage Note, is added to the principal balance of the Mortgage
Loan.
Negative
Amortization Cap:
With
respect to each Negative Amortization Mortgage Loan, the provision of each
Mortgage Note which provides for an absolute maximum percentage of the original
principal amount of such Mortgage Loan that the outstanding principal amount
of
the Mortgage Loan may reach as a result of Negative Amortization as specified
on
the Mortgage Loan Schedule.
Negative
Amortization Mortgage Loan:
Each
Mortgage Loan that is identified on the Mortgage Loan Schedule as a Mortgage
Loan that may be subject to Negative Amortization.
Net
Mortgage Rate:
With
respect to any Mortgage Loan, as of any date of determination, a per annum
rate
of interest equal to the then applicable Mortgage Interest Rate for such
Mortgage Loan minus the Servicing Fee rate.
Officer's
Certificate:
A
certificate signed by the Chairman of the Board or the Vice Chairman of the
Board or a President or a Vice President and by the Treasurer or the Secretary
or one of the Assistant Treasurers or Assistant Secretaries of the Person on
behalf of whom such certificate is being delivered.
Opinion
of Counsel:
A
written opinion of counsel, who may be salaried counsel for the Person on behalf
of whom the opinion is being given, reasonably acceptable to each Person to
whom
such opinion is addressed.
Payment
Adjustment Date:
With
respect to each Negative Amortization Mortgage Loan, the date on which Monthly
Payments shall be adjusted. A Payment Adjustment Date with respect to a Negative
Amortization Mortgage Loan shall occur on the dates specified on the Mortgage
Loan Schedule.
Periodic
Rate Cap:
With
respect to each Adjustable Rate Mortgage Loan and any Adjustment Date therefor,
a number of percentage points per annum that is set forth in the related
Mortgage Loan Schedule and in the related Mortgage Note, which is the maximum
amount by which the Mortgage Interest Rate for such Adjustable Rate Mortgage
Loan may increase (without regard to the Maximum Mortgage Interest Rate) or
decrease (without regard to the Minimum Mortgage Interest Rate) on such
Adjustment Date from the Mortgage Interest Rate in effect immediately prior
to
such Adjustment Date.
Person:
An
individual, corporation, limited liability company, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
Prepayment
Charge:
With
respect to any Mortgage Loan, any prepayment penalty or premium thereon payable
in connection with a Principal Prepayment on such Mortgage Loan pursuant to
the
terms of the related Mortgage Note.
Principal
Prepayment:
Any
payment or other recovery of principal on a Mortgage Loan which is received
in
advance of its scheduled Due Date, including any Prepayment Charge, which is
not
accompanied by an amount of interest representing scheduled interest due on
any
date or dates in any month or months subsequent to the month of
prepayment.
Purchase
Price:
The
price paid on the related Closing Date by the Initial Purchaser to the Seller
pursuant to the related Confirmation in exchange for the Mortgage Loans
purchased on such Closing Date as calculated as provided in
Section 4.
Qualified
Correspondent:
Any
Person from which the Seller purchased Mortgage Loans, provided that the
following conditions are satisfied: (i) such Mortgage Loans were originated
pursuant to an agreement between the Seller and such Person that contemplated
that such Person would underwrite mortgage loans from time to time, for sale
to
the Seller, in accordance with underwriting guidelines designated by the Seller
(“Designated Guidelines”) or guidelines that do not vary materially from such
Designated Guidelines; (ii) such Mortgage Loans were in fact underwritten as
described in clause (i) above and were acquired by the Seller within 180 days
after origination; (iii) either (x) the Designated Guidelines were, at the
time
such Mortgage Loans were originated, used by the Seller in origination of
mortgage loans of the same type as the Mortgage Loans for the Seller’s own
account or (y) the Designated Guidelines were, at the time such Mortgage Loans
were underwritten, designated by the Seller on a consistent basis for use by
lenders in originating mortgage loans to be purchased by the Seller; and (iv)
the Seller employed, at the time such Mortgage Loans were acquired by the
Seller, pre-purchase or post-purchase quality assurance procedures (which may
involve, among other things, review of a sample of mortgage loans purchased
during a particular time period or through particular channels) designed to
ensure that Persons from which it purchased mortgage loans properly applied
the
underwriting criteria designated by the Seller.
Qualified
Insurer:
An
insurance company duly qualified as such under the laws of the states in which
the Mortgaged Property is located, duly authorized and licensed in such states
to transact the applicable insurance business and to write the insurance
provided, and whose claims paying ability is rated in the two highest rating
categories by Best’s with respect to hazard and flood insurance.
Qualified
Substitute Mortgage Loan:
A
mortgage loan substituted for a Deleted Mortgage Loan pursuant to the terms
of
this Agreement which must, on the date of such substitution, (i) have an
outstanding principal balance, after application of all scheduled payments
of
principal and interest due during or prior to the month of substitution, not
in
excess of the Stated Principal Balance of the Deleted Mortgage Loan as of the
Due Date in the calendar month during which the substitution occurs, (ii) have
a
Mortgage Interest Rate not less than (and not more than one percentage point
in
excess of) the Mortgage Interest Rate of the Deleted Mortgage Loan, (iii) have
a
remaining term to maturity not greater than (and not more than one year less
than) that of the Deleted Mortgage Loan, (iv) have the same Due Date as the
Due
Date on the Deleted Mortgage Loan, (v) have a Loan-to-Value Ratio, and in the
case of a second lien Mortgage Loan, a Combined Loan-to-Value Ratio as of the
date of substitution equal to or lower than the Loan-to-Value Ratio and Combined
Loan-to-Value Ratio of the Deleted Mortgage Loan as of such date, (vi) have
a
Credit Score for the related Mortgagor not lower than that of the Mortgagor
under the Deleted Mortgage Loan; (vii) conform to each representation and
warranty set forth in Subsection 7.02 of this Agreement; and (viii) be the
same type of mortgage loan (i.e., lien status, fixed or adjustable rate with
the
same Gross Margin, Periodic Rate Cap and Index as the Deleted Mortgage Loan,
and
if an Adjustable Rate Mortgage Loan, the same type (e.g., 3/1, 5/1).
Rate/Term
Refinancing:
A
Refinanced Mortgage Loan, the proceeds of which are not in excess of the sum
of
(i) the existing first mortgage loan on the related Mortgaged Property and
related closing costs, and (ii) 2.0% of the new loan amount or $2,000.00,
whichever is less.
Reconstitution:
Any
Securitization Transaction or Whole Loan Transfer.
Reconstitution
Agreement:
The
agreement or agreements entered into by the Seller and the Purchaser and/or
certain third parties on the Reconstitution Date or Dates with respect to any
or
all of the Mortgage Loans serviced hereunder, in connection with a Whole Loan
Transfer or a Securitization Transaction as provided in
Section 12.
Reconstitution
Date:
The
date or dates on which any or all of the Mortgage Loans serviced under this
Agreement shall be removed from this Agreement and reconstituted as part of
a
Whole Loan Transfer or Securitization Transaction pursuant to Section 12
hereof.
Record
Date:
With
respect to each Distribution Date, the last Business Day of the month
immediately preceding the month in which such Distribution Date
occurs.
Refinanced
Mortgage Loan:
A
Mortgage Loan the proceeds of which were not used to purchase the related
Mortgaged Property.
Regulation
AB:
Subpart
229.1100 - Asset Backed Securities (Regulation AB), 17 C.F.R.
§§229.1100-229.1123, as such may be amended from time to time, and subject to
such clarification and interpretation as have been provided by the Commission
in
the adopting release (Asset-Backed Securities, Securities Act Release No.
33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff of the
Commission, or as may be provided by the Commission or its staff from time
to
time.
REMIC:
A “real
estate mortgage investment conduit” within the meaning of Section 860D of
the Code.
REMIC
Provisions:
Provisions of the federal income tax law relating to REMIC’s, which appear in
Sections 860A through 860G of the Code, and related provisions, and proposed,
temporary and final regulations and published rulings, notices and announcements
promulgated thereunder, as the foregoing may be in effect from time to
time.
REO
Account:
The
separate trust account or accounts created and maintained pursuant to this
Agreement which shall be entitled “New Century Mortgage Corporation in trust for
the Purchaser, as of [date of acquisition of title], Fixed and Adjustable Rate
Mortgage Loans”.
REO
Disposition:
The
final sale by the Seller of any REO Property.
REO
Property:
A
Mortgaged Property acquired as a result of the foreclosure or a deed in lieu
of
a Mortgage Loan.
Repurchase
Price:
With
respect to any Mortgage Loan, a price equal to (i) the Stated Principal Balance
of such Mortgage Loan, plus (ii) interest on such Stated Principal Balance
at
the Mortgage Interest Rate from and including the last Due Date through which
interest has been paid by or on behalf of the Mortgagor to (a) with respect to
any Mortgage Loan subject to a securitization, the first day of the month
following the date of repurchase, and (b) with respect to any other Mortgage
Loan, the day prior to the date of repurchase, less amounts received in respect
of such repurchased Mortgage Loan which are being held in the Custodial Account
for distribution in connection with such Mortgage Loan, plus (iii) any
unreimbursed, reasonable and necessary servicing advances and monthly advances
(including nonrecoverable monthly advances) and any unpaid servicing fees
allocable to such Mortgage Loan paid by any party other than the Seller, plus
(iv) any reasonable and necessary out-of-pocket costs and expenses incurred
by
the Purchaser, the servicer, master servicer or any trustee in respect of the
breach or defect giving rise to the repurchase obligation including without
limitation any costs and damages incurred by any such party in connection with
any violation by any such Mortgage Loan of any predatory or abusive lending
law.
Residential
Dwelling:
Any one
of the following: (i) a detached one-family dwelling, (ii) a detached two-
to
four-family dwelling, (iii) a one-family dwelling unit in a Xxxxxx Xxx eligible
condominium project, or (iv) a detached one-family dwelling in a planned unit
development, none of which is a co-operative, mobile or manufactured
home.
Securities
Act:
The
Securities Act of 1933, as amended.
Securitization
Transaction:
Any
transaction involving either (1) a sale or other transfer of some or all of
the
Mortgage Loans directly or indirectly to an issuing entity in connection with
an
issuance of publicly offered or privately placed, rated or unrated
mortgage-backed securities or (2) an issuance of publicly offered or privately
placed, rated or unrated securities, the payments on which are determined
primarily by reference to one or more portfolios of residential mortgage loans
consisting, in whole or in part, of some or all of the Mortgage
Loans.
Seller
Information:
As
defined in Section 13.07(i).
Servicer:
As
defined in Section 13.03(iii).
Servicing
Addendum:
The
terms and conditions attached hereto as Exhibit 9 which will govern the
servicing of the Mortgage Loans by Seller during the Interim Servicing
Period.
Servicing
Advances:
All
customary, reasonable and necessary “out-of-pocket” costs and expenses incurred
by the Seller in the performance of its servicing obligations, including, but
not limited to, the cost of (i) preservation, restoration and repair of a
Mortgaged Property, (ii) any enforcement or judicial proceedings with respect
to
a Mortgage Loan, including foreclosure actions and (iii) the management and
liquidation of REO Property.
Servicing
Criteria:
The
“servicing criteria” set forth in Item 1122(d) of Regulation AB, as such may be
amended from time to time.
Servicing
Fee:
With
respect to each Mortgage Loan, an amount equal to one twelfth of the product
of
0.50% and the principal balance of such Mortgage Loan, payable monthly, in
arrears. The obligation of the Purchaser to pay the Servicing Fee is limited
to,
and payable solely from, the interest portion (including recoveries with respect
to interest from Liquidation Proceeds and other proceeds, to the extent
permitted by Subsection 11.05) of related Monthly Payment collected by the
Seller, or as otherwise provided under Subsection 11.05. If the Interim
Servicing Period includes any partial month, the Servicing Fee for such month
shall be pro rated at a per diem rate based upon a 30-day month.
Servicing
File:
With
respect to each Mortgage Loan, the file retained by the Seller consisting of
originals of all documents in the Mortgage File which are not delivered to
the
Purchaser or the Custodian and copies of the Mortgage Loan
Documents.
S&P:
Standard & Poor's Ratings Group or its successor in interest.
Stated
Principal Balance:
As to
each Mortgage Loan as of any date of determination, (i) the principal balance
of
the Mortgage Loan as of the Cut-off Date after giving effect to payments of
principal received on or before such date, minus (ii) all amounts previously
distributed to the Purchaser with respect to the related Mortgage Loan
representing payments or recoveries of principal, plus (iii) the cumulative
amount of any Negative Amortization.
Static
Pool Information:
Static
pool information as described in Item 1105(a)(1)-(3) and 1105(c) of Regulation
AB.
Subcontractor:
Any
vendor, subcontractor or other Person that is not responsible for the overall
servicing (as “servicing” is commonly understood by participants in the
mortgage-backed securities market) of Mortgage Loans but performs one or more
discrete functions identified in Item 1122(d) of Regulation AB with respect
to
Mortgage Loans under the direction or authority of the Seller or a
Subservicer.
Subservicer:
Any
Person that services Mortgage Loans on behalf of the Seller or any Subservicer
and is responsible for the performance (whether directly or through Subservicers
or Subcontractors) of a substantial portion of the material servicing functions
required to be performed by the Seller under this Agreement or any
Reconstitution Agreement that are identified in Item 1122(d) of Regulation
AB.
Sub-Servicing
Agreement:
The
written contract between the Seller and a Subservicer relating to servicing
and
administration of certain Mortgage Loans as provided in Subsection 11.26 of
this
Agreement.
Tax
Service Contract:
A
transferable contract maintained for the Mortgaged Property with a tax service
provider for the purpose of obtaining current information from local taxing
authorities relating to such Mortgaged Property.
Third-Party
Originator:
Each
Person, other than a Qualified Correspondent, that originated Mortgage Loans
acquired by the Seller.
Underwriting
Guidelines:
The
Seller’s written underwriting guidelines in the form delivered to the Purchaser,
in effect with respect to the Mortgage Loans purchased by the Initial Purchaser
on the Initial Closing Date, as amended, supplemented or modified from time
to
time thereafter.
Whole
Loan Transfer:
Any
sale or transfer of some or all of the Mortgage Loans, other than a
Securitization Transaction.
SECTION
2. Agreement
to Purchase.
The
Seller agrees to sell, and the Initial Purchaser agrees to purchase, from
time-to-time, Mortgage Loans having an aggregate principal balance on the
related Cut-off Date in an amount as set forth in the related Confirmation,
or
in such other amount as agreed by the Initial Purchaser and the Seller as
evidenced by the actual aggregate principal balance of the Mortgage Loans
accepted by the Initial Purchaser on the related Closing Date.
SECTION
3. Mortgage
Loan Schedules.
The
Seller shall deliver the Mortgage Loan Schedule for a Mortgage Loan Package
to
be purchased on a particular Closing Date to the Initial Purchaser at least
three (3) Business Days prior to the related Closing Date, unless otherwise
mutually agreed upon or as otherwise evidenced by the actions of the
parties.
SECTION
4. Purchase
Price.
The
Purchase Price for each Mortgage Loan listed on the related Mortgage Loan
Schedule shall be the percentage of par as stated in the related Confirmation
(subject to adjustment as provided therein), multiplied by its Stated Principal
Balance as of the related Cut-off Date. If so provided in the related
Confirmation, certain of the Mortgage Loans shall be priced separately as agreed
upon by the Seller and the Initial Purchaser.
In
addition to the Purchase Price as described above, the Initial Purchaser shall
pay to the Seller, at closing, accrued interest on the Stated Principal Balance
of each Mortgage Loan as of the related Cut-off Date at its Mortgage Interest
Rate, net of the Servicing Fee, from the related Cut-off Date through the day
prior to the related Closing Date, both inclusive.
The
Purchaser shall own and be entitled to receive with respect to each Mortgage
Loan purchased, (1) all recoveries of principal collected after the Cut-off
Date, (2) all payments of interest on the Mortgage Loans collected after the
Cut-off Date net of the Servicing Fee during the Interim Servicing Period;
and
(3) all Prepayment Charges on the Mortgage Loans collected after the Cut-off
Date.
SECTION
5. Examination
of Mortgage Files.
In
addition to the rights granted to the Initial Purchaser under the related
Confirmation to underwrite an agreed upon number of Mortgage Loans and review
the related Mortgage Files prior to the Closing Date, prior to the related
Closing Date, the Seller shall, at the Initial Purchaser’s option (a) deliver to
the Custodian in escrow, for examination with respect to each Mortgage Loan
to
be purchased on such Closing Date, the related Mortgage File, including the
Assignment of Mortgage, pertaining to each Mortgage Loan, or (b) make the agreed
upon number of Mortgage Files, as set forth in the related Confirmation,
available to the Initial Purchaser for examination at the Seller's offices
or
such other location as shall otherwise be agreed upon by the Initial Purchaser
and the Seller. Such examination may be made by the Initial Purchaser or its
designee at any reasonable time before or after the related Closing Date. If
the
Initial Purchaser makes such examination prior to the related Closing Date
and
identifies any Mortgage Loans that do not conform to the terms of the related
Confirmation, the terms of this Agreement or the Initial Purchaser’s
underwriting standards, such Mortgage Loans may, at the Initial Purchaser's
option, be rejected for purchase by the Initial Purchaser. If not purchased
by
the Initial Purchaser, such Mortgage Loans shall be deleted from the related
Mortgage Loan Schedule. The Initial Purchaser may, at its option and without
notice to the Seller, purchase all or part of any Mortgage Loan Package without
conducting any partial or complete examination. Such
due
diligence shall not impair or diminish the rights of the Initial Purchaser
or
any assignee of the Initial Purchaser under the Agreement with respect to a
material breach of representations and warranties contained in the Agreement,
unless such exceptions are disclosed in writing to the Initial Purchaser or
described in the due diligence report provided to the Initial Purchaser.
SECTION
6. Conveyance
from Seller to Initial Purchaser.
| Subsection 6.01. |
Conveyance
of Mortgage Loans; Possession of Servicing Files.
|
The
Seller, simultaneously with the payment of the Purchase Price, shall execute
and
deliver to the Initial Purchaser an Assignment and Conveyance with respect
to
the related Mortgage Loan Package in the form attached hereto as Exhibit
4.
The
Servicing File retained by the Seller with respect to each Mortgage Loan
pursuant to this Agreement shall be appropriately identified in the Seller's
computer system to reflect clearly the sale of such related Mortgage Loan to
the
Purchaser. The Purchaser shall be entitled to receive all Prepayment Charges
required to be paid by a Mortgagor under the terms of any Mortgage Loan. The
Seller shall release from its custody the contents of any Servicing File
retained by it only in accordance with this Agreement.
| Subsection 6.02. |
Books
and Records.
|
Record
title to each Mortgage and the related Mortgage Note as of the related Closing
Date shall be in the name of the Seller, the Initial Purchaser, the Custodian
or
one or more designees of the Initial Purchaser, as the Initial Purchaser shall
designate. Notwithstanding the foregoing, beneficial ownership of each Mortgage
and the related Mortgage Note shall be vested solely in the Purchaser or the
appropriate designee of the Purchaser, as the case may be. All rights arising
out of the Mortgage Loans including, but not limited to, all funds received
by
the Seller after the related Cut-off Date on or in connection with a Mortgage
Loan as provided in Section 4 shall be vested in the Purchaser or one or
more designees of the Purchaser; provided, however, that all such funds received
on or in connection with a Mortgage Loan as provided in Section 4 shall be
received and held by the Seller in trust for the benefit of the Purchaser or
the
assignee of the Purchaser, as the case may be, as the owner of the Mortgage
Loans pursuant to the terms of this Agreement.
It
is the
express intention of the parties that the transactions contemplated by this
Agreement be, and be construed as, a sale of the Mortgage Loans by the Seller
and not a pledge of the Mortgage Loans by the Seller to the Purchaser to secure
a debt or other obligation of the Seller. Consequently, the sale of each
Mortgage Loan shall be reflected as a sale on the Seller's business records,
tax
returns and financial statements.
| Subsection 6.03. |
Delivery
of Mortgage Loan Documents.
|
Pursuant
to the Custodial Agreement to be executed among and delivered by the Initial
Purchaser, the Custodian and the Seller prior to the Initial Closing Date,
the
Seller shall from time to time in connection with each Closing Date, at least
five (5) Business Days prior to such Closing Date, deliver and release to the
Custodian the Mortgage Loan Documents with respect to each Mortgage Loan to
be
purchased and sold on the related Closing Date and set forth on the related
Mortgage Loan Schedule delivered with such Mortgage Loan Documents.
The
Custodian shall certify its receipt of all such Mortgage Loan Documents required
to be delivered pursuant to the Custodial Agreement for the related Closing
Date, as evidenced by the Trust Receipt and Initial Certification of the
Custodian in the form annexed to the Custodial Agreement. The Seller shall
be
responsible for maintaining the Custodial Agreement during the Interim Servicing
Period. The fees and expenses of the Custodian shall be paid by the
Purchaser.
The
Seller shall forward to the Custodian original documents evidencing an
assumption, modification, consolidation or extension of any Mortgage Loan
entered into in accordance with this Agreement within two weeks of their
execution, provided, however, that the Seller shall provide the Custodian with
a
certified true copy of any such document submitted for recordation within two
weeks of its execution, and shall provide the original of any document submitted
for recordation or a copy of such document certified by the appropriate public
recording office to be a true and complete copy of the original within ninety
(90) days of its submission for recordation.
Subsection
6.04 Quality
Control Procedures.
The
Seller shall have an internal quality control program that verifies, on a
regular basis, the existence and accuracy of the legal documents, credit
documents, property appraisals, and underwriting decisions. The program shall
include evaluating and monitoring the overall quality of the Seller’s loan
production and the servicing activities of the Seller. The program is to ensure
that the Mortgage Loans are originated and serviced in accordance with Accepted
Servicing Standards and the Underwriting Guidelines; guard against dishonest,
fraudulent, or negligent acts; and guard against errors and omissions by
officers, employees, or other authorized persons.
| SECTION 7. |
Representations,
Warranties and Covenants of the Seller: Remedies for
Breach.
|
| Subsection 7.01. |
Representations
and Warranties Respecting the Seller
|
The
Seller represents, warrants and covenants to the Initial Purchaser and to any
subsequent Purchaser as of the Initial Closing Date and each subsequent Closing
Date or as of such date specifically provided herein or in the applicable
Assignment and Conveyance:
(i) The
Seller is a California corporation duly organized, validly existing and in
good
standing under the laws of California. The Seller has all licenses necessary
to
carry out its business as now being conducted, and is licensed and qualified
to
transact business in and is in good standing under the laws of each state in
which any Mortgaged Property is located or is otherwise exempt under applicable
law from such licensing or qualification or is otherwise not required under
applicable law to effect such licensing or qualification and no demand for
such
licensing or qualification has been made upon the Seller by any such state,
and
in any event the Seller is in compliance with the laws of any such state to
the
extent necessary to ensure the enforceability of each Mortgage Loan and the
servicing of the Mortgage Loans in accordance with the terms of this Agreement.
No licenses or approvals obtained by the Seller have been suspended or revoked
by any court, administrative agency, arbitrator or governmental body and no
proceedings are pending which might result in such suspension or
revocation;
(ii) The
Seller has the full power and authority to hold each Mortgage Loan, to sell
each
Mortgage Loan, and to execute, deliver and perform, and to enter into and
consummate, all transactions contemplated by this Agreement. The Seller has
duly
authorized the execution, delivery and performance of this Agreement, has duly
executed and delivered this Agreement, and this Agreement, assuming due
authorization, execution and delivery by the Purchaser, constitutes a legal,
valid and binding obligation of the Seller, enforceable against it in accordance
with its terms except as the enforceability thereof may be limited by
bankruptcy, insolvency or reorganization;
(iii) The
execution and delivery of this Agreement by the Seller and the performance
of
and compliance with the terms of this Agreement will not violate the Seller's
articles of incorporation or by-laws or constitute a default under or result
in
a breach or acceleration of, any material contract, agreement or other
instrument to which the Seller is a party or which may be applicable to the
Seller or its assets;
(iv) The
Seller is not in violation of, and the execution and delivery of this Agreement
by the Seller and its performance and compliance with the terms of this
Agreement will not constitute a violation with respect to, any order or decree
of any court or any order or regulation of any federal, state, municipal or
governmental agency having jurisdiction over the Seller or its assets, which
violation might have consequences that would materially and adversely affect
the
condition (financial or otherwise) or the operation of the Seller or its assets
or might have consequences that would materially and adversely affect the
performance of its obligations and duties hereunder;
(v) The
Seller is an approved seller/servicer for Xxxxxx Mae and Xxxxxxx
Mac
in good
standing and is a HUD approved mortgagee pursuant to Section 203 of the National
Housing Act. No event has occurred, including but not limited to a change in
insurance coverage, which would make the Seller unable to comply with Xxxxxx
Mae, Xxxxxxx
Mac
or HUD
eligibility requirements or which would require notification to Xxxxxx Mae,
Xxxxxxx
Mac
or
HUD;
(vi) The
Seller does not believe, nor does it have any reason or cause to believe, that
it cannot perform each and every covenant contained in this
Agreement;
(vii) The
Mortgage Note, the Mortgage, the Assignment of Mortgage and any other documents
required to be delivered with respect to each Mortgage Loan pursuant to the
Custodial Agreement, have been delivered to the Custodian all in compliance
with
the specific requirements of the Custodial Agreement. With respect to each
Mortgage Loan, the Seller is in possession of a complete Mortgage File in
compliance with Exhibit
5,
except
for such documents as have been delivered to the Custodian;
(viii) Immediately
prior to the payment of the Purchase Price for each Mortgage Loan, the Seller
was the owner of record of the related Mortgage and the indebtedness evidenced
by the related Mortgage Note and upon the payment of the Purchase Price by
the
Purchaser, in the event that the Seller retains record title, the Seller shall
retain such record title to each Mortgage, each related Mortgage Note and the
related Mortgage Files with respect thereto in trust for the Purchaser as the
owner thereof and only for the purpose of servicing and supervising the
servicing of each Mortgage Loan;
(ix) There
are
no actions or proceedings against, or to the Seller’s Knowledge, investigations
of, the Seller before any court, administrative agency or other tribunal (A)
that might prohibit its entering into this Agreement, (B) seeking to prevent
the
sale of the Mortgage Loans or the consummation of the transactions contemplated
by this Agreement or (C) that might prohibit or materially and adversely affect
the performance by the Seller of its obligations under, or the validity or
enforceability of, this Agreement;
(x) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Seller
of,
or compliance by the Seller with, this Agreement or the consummation of the
transactions contemplated by this Agreement, except for such consents,
approvals, authorizations or orders, if any, that have been obtained prior
to
the Closing Date;
(xi) The
consummation of the transactions contemplated by this Agreement are in the
ordinary course of business of the Seller, and the transfer, assignment and
conveyance of the Mortgage Notes and the Mortgages by the Seller pursuant to
this Agreement are not subject to the bulk transfer or any similar statutory
provisions;
(xii) The
transfer of the Mortgage Loans shall be treated as a sale on the books and
records of the Seller, and the Seller has determined that, and will treat,
the
disposition of the Mortgage Loans pursuant to this Agreement for tax and
accounting purposes as a sale. The Seller shall maintain a complete set of
books
and records for each Mortgage Loan which shall be clearly marked to reflect
the
ownership of each Mortgage Loan by the Purchaser;
(xiii) The
consideration received by the Seller upon the sale of the Mortgage Loans
constitutes fair consideration and reasonably equivalent value for such Mortgage
Loans;
(xiv) The
Seller is solvent and will not be rendered insolvent by the consummation of
the
transactions contemplated hereby. The Seller is not transferring any Mortgage
Loan with any intent to hinder, delay or defraud any of its
creditors;
(xv) The
information delivered by the Seller to the Purchaser with respect to the
Seller's loan loss, foreclosure and delinquency experience for the twelve (12)
months immediately preceding the Initial Closing Date on mortgage loans
underwritten to the same standards as the Mortgage Loans and covering mortgaged
properties similar to the Mortgaged Properties, is true and correct in all
material respects;
(xvi) Neither
this Agreement nor any written statement, report or other document prepared
and
furnished or to be prepared and furnished by the Seller pursuant to this
Agreement or in connection with the transactions contemplated hereby contains
any untrue statement of material fact or omits to state a material fact
necessary to make the statements contained herein or therein not misleading;
and
(xvii) The
Seller has not dealt with any broker, investment banker, agent or other person
that may be entitled to any commission or compensation in connection with the
sale of the Mortgage Loans.
| Subsection 7.02. |
Representations
and Warranties Regarding Individual Mortgage Loans.
|
The
Seller hereby represents and warrants to the Initial Purchaser and to any
subsequent Purchaser that, as to each Mortgage Loan, as of the related Closing
Date for such Mortgage Loan:
(i) The
information set forth in the related Mortgage Loan Schedule is complete, true
and correct as of the related Cut-Off Date;
(ii) The
Mortgage Loan is in compliance with all requirements set forth in the related
Confirmation, and the characteristics of the related Mortgage Loan Package
as
set forth in the related Confirmation are true and correct; provided, however,
that in the event of any conflict between the terms of any Confirmation and
this
Agreement, the terms of this Agreement shall control;
(iii) All
payments required to be made up to the close of business on the Closing Date
for
such Mortgage Loan under the terms of the Mortgage Note have been made; the
Seller has not advanced funds, or induced, solicited or knowingly received
any
advance of funds from a party other than the owner of the related Mortgaged
Property, directly or indirectly, for the payment of any amount required by
the
Mortgage Note or Mortgage; no Mortgage Loan is thirty (30) or more days
delinquent as of the Closing Date and there has been no delinquency in thirty
(30) or more days, exclusive of any period of grace, in any payment by the
Mortgagor thereunder since the origination of the Mortgage Loan;
(iv) There
are
no delinquent taxes, ground rents, water charges, sewer rents, assessments,
insurance premiums, leasehold payments, including assessments payable in future
installments or other outstanding charges affecting the related Mortgaged
Property;
(v) The
terms
of the Mortgage Note and the Mortgage have not been impaired, waived, altered
or
modified in any respect, except by written instruments, recorded in the
applicable public recording office if necessary to maintain the lien priority
of
the Mortgage, and which have been delivered to the Custodian; the substance
of
any such waiver, alteration or modification has been approved by the title
insurer, to the extent required by the related policy, and is reflected on
the
related Mortgage Loan Schedule. No instrument of waiver, alteration or
modification has been executed, and no Mortgagor has been released, in whole
or
in part, except in connection with an assumption agreement approved by
the
title
insurer, to the extent required by the policy, and which assumption agreement
has been delivered to the Custodian and the terms of which are reflected in
the
related Mortgage Loan Schedule;
(vi) The
Mortgage Note and the Mortgage are not subject to any right of rescission,
set-off, counterclaim or defense, including the defense of usury, nor will
the
operation of any of the terms of the Mortgage Note and the Mortgage, or the
exercise of any right thereunder, render the Mortgage unenforceable, in whole
or
in part, or subject to any valid right of rescission, set-off, counterclaim
or
defense, including the defense of usury and no such right of rescission,
set-off, counterclaim or defense has been asserted with respect thereto. Each
Prepayment Charge or penalty with respect to any Mortgage Loan is permissible,
enforceable and collectible under applicable federal, state and local
law;
(vii) All
buildings upon the Mortgaged Property are insured by a Qualified Insurer against
loss by fire, hazards of extended coverage and such other hazards as are
customary in the area where the Mortgaged Property is located, pursuant to
insurance policies providing coverage in an amount not less than the greatest
of
(i) 100% of the replacement cost of all improvements to the Mortgaged Property,
(ii) either (A) the outstanding principal balance of the Mortgage Loan with
respect to each first lien Mortgage Loan or (B) with respect to each second
lien
Mortgage Loan, the sum of the outstanding principal balance of the related
first
lien mortgage loan and the outstanding principal balance of the second lien
Mortgage Loan, or (iii) the amount necessary to avoid the operation of any
co-insurance provisions with respect to the Mortgaged Property, and consistent
with the amount that would have been required as of the date of origination
in
accordance with the Underwriting Guidelines. All such insurance policies contain
a standard mortgagee clause naming the Seller, its successors and assigns as
mortgagee and all premiums thereon have been paid. If the Mortgaged Property
is
in an area identified on a Flood Hazard Map or Flood Insurance Rate Map issued
by the Federal Emergency Management Agency as having special flood hazards
(and
such flood insurance has been made available) a flood insurance policy meeting
the requirements of the current guidelines of the Federal Insurance
Administration is in effect. The Mortgage obligates the Mortgagor thereunder
to
maintain all such insurance at the Mortgagor's cost and expense, and on the
Mortgagor's failure to do so, authorizes the holder of the Mortgage to maintain
such insurance at Mortgagor's cost and expense and to seek reimbursement
therefor from the Mortgagor;
(viii) Any
and
all requirements of any federal, state or local law including, without
limitation, usury, truth in lending, real estate settlement procedures,
predatory and abusive lending, consumer credit protection, equal credit
opportunity, fair housing or disclosure laws applicable to the origination
and
servicing of mortgage loans of a type similar to the Mortgage Loans and
applicable to any prepayment penalty associated with the Mortgage Loans at
origination have been complied with;
(ix) The
Mortgage has not been satisfied, cancelled, subordinated or rescinded, in whole
or in part, and the Mortgaged Property has not been released from the lien
of
the Mortgage, in whole or in part, nor has any instrument been executed that
would effect any such satisfaction, cancellation, subordination, rescission
or
release;
(x) The
Mortgage (including any Negative Amortization which may arise thereunder) is
a
valid, existing and enforceable (A) first lien and first priority security
interest with respect to each Mortgage Loan which is indicated by the Seller
to
be a first lien (as reflected on the Mortgage Loan Schedule), or (B) second
lien
and second priority security interest with respect to each Mortgage Loan which
is indicated by the Seller to be a second lien (as reflected on the Mortgage
Loan Schedule), in either case, on the Mortgaged Property, including all
improvements on the Mortgaged Property subject only to (a) the lien of current
real property taxes and assessments not yet due and payable, (b) covenants,
conditions and restrictions, rights of way, easements and other matters of
the
public record as of the date of recording being acceptable to mortgage lending
institutions generally and specifically referred to in the lender's title
insurance policy delivered to the originator of the Mortgage Loan and which
do
not adversely affect the Appraised Value of the Mortgaged Property, (c) with
respect to each Mortgage Loan which is indicated by the Seller to be a second
lien Mortgage Loan (as reflected on the Mortgage Loan Schedule) a first lien
on
the Mortgaged Property; and (d) other matters to which like properties are
commonly subject which do not materially interfere with the benefits of the
security intended to be provided by the Mortgage or the use, enjoyment, value
or
marketability of the related Mortgaged Property. Any security agreement, chattel
mortgage or equivalent document related to and delivered in connection with
the
Mortgage Loan establishes and creates a valid, existing and enforceable first
or
second lien and first or second priority security interest (in each case, as
indicated on the Mortgage Loan Schedule) on the property described therein
and
the Seller has full right to sell and assign the same to the Purchaser. Except
as described on the related Mortgage Loan Schedule, the Mortgaged Property
was
not, as of the date of origination of the Mortgage Loan, subject to a mortgage,
deed of trust, deed to secure debt or other security instrument originated
by
the Seller and creating a lien subordinate to the lien of the
Mortgage;
(xi) The
Mortgage Note and the related Mortgage are genuine and each is the legal, valid
and binding obligation of the maker thereof, enforceable in accordance with
its
terms;
(xii) All
parties to the Mortgage Note and the Mortgage had legal capacity to enter into
the Mortgage Loan and to execute and deliver the Mortgage Note and the Mortgage,
and the Mortgage Note and the Mortgage have been duly and properly executed
by
such parties. The Mortgagor is a natural person;
(xiii) The
proceeds of the Mortgage Loan have been fully disbursed to or for the account
of
the Mortgagor and there is no obligation for the Mortgagee to advance additional
funds thereunder and any and all requirements as to completion of any on-site
or
off-site improvement and as to disbursements of any escrow funds therefor have
been complied with. All costs, fees and expenses incurred in making or closing
the Mortgage Loan and the recording of the Mortgage have been paid, and the
Mortgagor is not entitled to any refund of any amounts paid or due to the
Mortgagee pursuant to the Mortgage Note or Mortgage;
(xiv) Immediately
prior to the transfer and assignment herein contemplated, the Seller is the
sole
legal, beneficial and equitable owner of the Mortgage Note and the Mortgage
and
has full right to transfer and sell the Mortgage Loan to the Purchaser free
and
clear of any encumbrance, equity, lien, pledge, charge, claim or security
interest;
(xv) All
parties which have had any interest in the Mortgage Loan, whether as mortgagee,
assignee, pledgee or otherwise, are (or, during the period in which they held
and disposed of such interest, were) in compliance with any and all applicable
“doing business” and licensing requirements of the laws of the state wherein the
Mortgaged Property is located;
(xvi) The
Mortgage Loan is covered by an American Land Title Association (“ALTA”) lender’s
title insurance policy (which, in the case of an Adjustable Rate Mortgage Loan
has an adjustable rate mortgage endorsement in the form of ALTA 6.0 or 6.1),
insuring (subject to the exceptions contained in (x)(a) and (b), and with
respect to any second lien Mortgage Loan (c), above) the Seller, its successors
and assigns as to the first or second priority lien (as indicated on the
Mortgage Loan Schedule) of the Mortgage in the original principal amount of
the
Mortgage Loan (including, if the Mortgage Loan provides for Negative
Amortization, the maximum amount of Negative Amortization in accordance with
the
Mortgage) and, with respect to any Adjustable Rate Mortgage Loan, against any
loss by reason of the invalidity or unenforceability of the lien resulting
from
the provisions of the Mortgage providing for adjustment in the Mortgage Interest
Rate and Monthly Payment and Negative Amortization provisions of the Mortgage
Note. Additionally, such lender's title insurance policy affirmatively insures
ingress and egress to and from the Mortgaged Property, and against encroachments
by or upon the Mortgaged Property or any interest therein. The Seller is the
sole insured of such lender's title insurance policy, and such lender’s title
insurance policy is in full force and effect and will be in full force and
effect upon the consummation of the transactions contemplated by this Agreement.
No claims have been made under such lender's title insurance policy, and no
prior holder of the related Mortgage, including the Seller, has done, by act
or
omission, anything which would impair the coverage of such lender's title
insurance policy;
(xvii) There
is
no default, breach, violation or event of acceleration existing under the
Mortgage or the Mortgage Note and no event which, with the passage of time
or
with notice and the expiration of any grace or cure period, would constitute
a
default, breach, violation or event of acceleration, and the Seller has not
waived any default, breach, violation or event of acceleration. With respect
to
each second lien Mortgage Loan (i) the first lien mortgage loan is in full
force
and effect, (ii) there is no default, breach, violation or event of acceleration
existing under such first lien mortgage or the related mortgage note, (iii)
no
event which, with the passage of time or with notice and the expiration of
any
grace or cure period, would constitute a default, breach, violation or event
of
acceleration thereunder, (iv) either (A) the first lien mortgage contains a
provision which allows or (B) applicable law requires, the mortgagee under
the
second lien Mortgage Loan to receive notice of, and affords such mortgagee
an
opportunity to cure any default by payment in full or otherwise under the first
lien mortgage, (v) the related first lien does not provide for or permit
negative amortization under such first lien Mortgage Loan, and (vi) either
no
consent for the Mortgage Loan is required by the holder of the first lien or
such consent has been obtained and is contained in the Mortgage
File;
(xviii) There
are
no mechanics' or similar liens or claims which have been filed for work, labor
or material (and no rights are outstanding that under law could give rise to
such lien) affecting the related Mortgaged Property which are or may be liens
prior to, or equal or coordinate with, the lien of the related
Mortgage;
(xix) All
improvements which were considered in determining the Appraised Value of the
related Mortgaged Property lay wholly within the boundaries and building
restriction lines of the Mortgaged Property, and no improvements on adjoining
properties encroach upon the Mortgaged Property;
(xx) The
Mortgage Loan was originated by the Seller or by a savings and loan association,
a savings bank, a commercial bank or similar banking institution which is
supervised and examined by a federal or state authority, or by a mortgagee
approved as such by the Secretary of HUD;
(xxi)
Principal payments on the Mortgage Loan, excluding any IO Mortgage Loan,
commenced no more than sixty (60) days after the proceeds of the Mortgage Loan
were disbursed. The Mortgage Loan bears interest at the Mortgage Interest Rate.
With respect to each Mortgage Loan which is not a Negative Amortization Loan,
the Mortgage Note is payable on the first day of each month in Monthly Payments,
which, in the case of a Fixed Rate Mortgage Loan, are sufficient to fully
amortize the original principal balance over the original term thereof (other
than with respect to a Mortgage Loan identified on the related Mortgage Loan
Schedule as an interest-only Mortgage Loan during the interest-only period
or a
Mortgage Loan which is identified on the related Mortgage Loan Schedule as
a
Balloon Mortgage Loan) and to pay interest at the related Mortgage Interest
Rate, and, in the case of an Adjustable Rate Mortgage Loan, are changed on
each
Adjustment Date, and in any case, are sufficient to fully amortize the original
principal balance over the original term thereof (other than with respect to
a
Mortgage Loan identified on the related Mortgage Loan Schedule as an
interest-only Mortgage Loan during the interest-only period or a Mortgage Loan
which is identified on the related Mortgage Loan Schedule as a Balloon Mortgage
Loan) and to pay interest at the related Mortgage Interest Rate. With respect
to
each Negative Amortization Mortgage Loan, the related Mortgage Note requires
a
Monthly Payment which is sufficient during the period following each Payment
Adjustment Date, to fully amortize the outstanding principal balance as of
the
first day of such period (including any Negative Amortization) over the then
remaining term of such Mortgage Note and to pay interest at the related Mortgage
Interest Rate; provided, that the Monthly Payment shall not increase to an
amount that exceeds 107.5% of the amount of the Monthly Payment that was due
immediately prior to the Payment Adjustment Date; provided, further, that the
payment adjustment cap shall not be applicable with respect to the adjustment
made to the Monthly Payment that occurs in a year in which the Mortgage Loan
has
been outstanding for a multiple of five (5) years and in any such year the
Monthly Payment shall be adjusted to fully amortize the Mortgage Loan over
the
remaining term. With respect to each Mortgage Loan identified on the Mortgage
Loan Schedule as an interest-only Mortgage Loan, the interest-only period shall
not exceed ten (10) years (or such other period specified on the Mortgage Loan
Schedule) and following the expiration of such interest-only period, the
remaining Monthly Payments shall be sufficient to fully amortize the original
principal balance over the remaining term of the Mortgage Loan and to pay
interest at the related Mortgage Interest Rate. With respect to each Balloon
Mortgage Loan, the Mortgage Note requires a monthly payment which is sufficient
to fully amortize the original principal balance over the original term thereof
and to pay interest at the related Mortgage Interest Rate and requires a final
Monthly Payment substantially greater than the preceding monthly payment which
is sufficient to repay the remaining unpaid principal balance of the Balloon
Mortgage Loan at the Due Date of such monthly payment. The Index for each
Adjustable Rate Mortgage Loan is as set forth on the Mortgage Loan Schedule.
No
Mortgage Loan is a Convertible Mortgage Loan. No Balloon Mortgage Loan has
an
original stated maturity of less than seven (7) years;
(xxii) The
origination, servicing and collection practices used with respect to each
Mortgage Note and Mortgage including, without limitation, the establishment,
maintenance and servicing of the Escrow Accounts and Escrow Payments, if any,
since origination, have been in all respects legal, proper, prudent and
customary in the mortgage origination and servicing industry. The Mortgage
Loan
has been serviced by the Seller and any predecessor servicer in accordance
with
the terms of the Mortgage Note and Accepted Servicing Practices. With respect
to
escrow deposits and Escrow Payments, if any, all such payments are in the
possession of, or under the control of, the Seller and there exist no
deficiencies in connection therewith for which customary arrangements for
repayment thereof have not been made. No escrow deposits or Escrow Payments
or
other charges or payments due the Seller have been capitalized under any
Mortgage or the related Mortgage Note and no such escrow deposits or Escrow
Payments are being held by the Seller for any work on a Mortgaged Property
which
has not been completed;
(xxiii) The
Mortgaged Property is free of material damage and waste and there is no
proceeding pending for the total or partial condemnation thereof;
(xxiv) The
Mortgage and related Mortgage Note contain customary and enforceable provisions
such as to render the rights and remedies of the holder thereof adequate for
the
realization against the Mortgaged Property of the benefits of the security
provided thereby, including, (a) in the case of a Mortgage designated as a
deed
of trust, by trustee's sale, and (b) otherwise by judicial foreclosure. The
Mortgaged Property has not been subject to any bankruptcy proceeding or
foreclosure proceeding and the Mortgagor has not filed for protection under
applicable bankruptcy laws. There is no homestead or other exemption available
to the Mortgagor which would interfere with the right to sell the Mortgaged
Property at a trustee's sale or the right to foreclose the Mortgage. The
Mortgagor has not notified the Seller and the Seller has no knowledge of any
relief requested or allowed to the Mortgagor under the Servicemembers’ Civil
Relief Act;
(xxv) The
Mortgage Loan was underwritten in accordance with the Underwriting Guidelines
in
effect at the time the Mortgage Loan was originated; and the Mortgage Note
and
Mortgage are on forms acceptable to Xxxxxx Xxx and Xxxxxxx
Mac;
(xxvi) The
Mortgage Note is not and has not been secured by any collateral except the
lien
of the corresponding Mortgage on the Mortgaged Property and the security
interest of any applicable security agreement or chattel mortgage referred
to in
(x) above;
(xxvii) The
Mortgage File contains an appraisal of the related Mortgaged Property which
satisfied the standards of Xxxxxx Mae and Xxxxxxx
Mac,
was on
appraisal form 1004 or form 2055 with an interior inspection and was made and
signed, prior to the approval of the Mortgage Loan application, by a qualified
appraiser, duly appointed by the Seller, who had no interest, direct or indirect
in the Mortgaged Property or in any loan made on the security thereof, whose
compensation is not affected by the approval or disapproval of the Mortgage
Loan
and who met the minimum qualifications of Xxxxxx Mae and Xxxxxxx
Mac.
Each
appraisal of the Mortgage Loan was made in accordance with the relevant
provisions of the Financial Institutions Reform, Recovery, and Enforcement
Act
of 1989;
(xxviii) In
the
event the Mortgage constitutes a deed of trust, a trustee, duly qualified under
applicable law to serve as such, has been properly designated and currently
so
serves and is named in the Mortgage, and no fees or expenses are or will become
payable by the Purchaser to the trustee under the deed of trust, except in
connection with a trustee's sale after default by the Mortgagor;
(xxix) No
Mortgage Loan contains provisions pursuant to which Monthly Payments are (a)
paid or partially paid with funds deposited in any separate account established
by the Seller, the Mortgagor, or anyone on behalf of the Mortgagor, (b) paid
by
any source other than the Mortgagor or (c) contains any other similar provisions
which may constitute a “buydown” provision. The Mortgage Loan is not a graduated
payment mortgage loan and the Mortgage Loan does not have a shared appreciation
or other contingent interest feature;
(xxx) [Reserved];
(xxxi) No
Mortgage Loan was made in connection with (a) the construction or substantial
rehabilitation of a Mortgaged Property or (b) facilitating the trade-in or
exchange of a Mortgaged Property;
(xxxii) With
respect to any Prime Mortgage Loans, the Seller has no knowledge of any
circumstances or condition with respect to the Mortgage, the Mortgaged Property,
the Mortgagor or the Mortgagor's credit standing that can reasonably be expected
to cause the Mortgage Loan to be an unacceptable investment, cause the Mortgage
Loan to become delinquent, or adversely affect the value of the Mortgage
Loan;
(xxxiii) No
Mortgage Loan had an LTV at origination in excess of 100% or a CLTV at
origination in excess of 100%. No Mortgage Loan is subject to a lender paid
primary mortgage insurance policy;
(xxxiv) The
Mortgaged Property is lawfully occupied under applicable law; all inspections,
licenses and certificates required to be made or issued with respect to all
occupied portions of the Mortgaged Property and, with respect to the use and
occupancy of the same, including but not limited to certificates of occupancy,
have been made or obtained from the appropriate authorities;
(xxxv) No
error,
omission, misrepresentation, negligence, fraud or similar occurrence with
respect to a Mortgage Loan has taken place on the part of any person, including
without limitation the Mortgagor, any appraiser, any builder or developer,
or
any other party involved in the origination of the Mortgage Loan or in the
application of any insurance in relation to such Mortgage Loan;
(xxxvi) The
Assignment of Mortgage is in recordable form, except for the name of the
assignee which is blank, and is acceptable for recording under the laws of
the
jurisdiction in which the Mortgaged Property is located;
(xxxvii) Any
principal advances made to the Mortgagor prior to the Cut-off Date have been
consolidated with the outstanding principal amount secured by the Mortgage,
and
the secured principal amount, as consolidated, bears a single interest rate
and
single repayment term. The lien of the Mortgage securing the consolidated
principal amount is expressly insured as having first or second (as indicated
on
the Mortgage Loan Schedule) lien priority by a title insurance policy, an
endorsement to the policy insuring the mortgagee's consolidated interest or
by
other title evidence acceptable to Xxxxxx Mae and Xxxxxxx
Mac.
The
consolidated principal amount does not exceed the original principal amount
of
the Mortgage Loan plus any Negative Amortization;
(xxxviii) If
the
Residential Dwelling on the Mortgaged Property is a condominium unit or a unit
in a planned unit development (other than a de minimis planned unit development)
such condominium or planned unit development project meets the eligibility
requirements set forth in the Seller’s Underwriting Guidelines;
(xxxix) The
source of the down payment with respect to each purchase money Mortgage Loan
has
been fully verified by the Seller;
(xl) Interest
on each Mortgage Loan is calculated on the basis of a 360-day year consisting
of
twelve 30-day months;
(xli) The
Mortgaged Property is in material compliance with all applicable environmental
laws pertaining to environmental hazards including, without limitation,
asbestos, and neither the Seller nor, to the Seller’s knowledge, the related
Mortgagor, has received any notice of any violation or potential violation
of
such law;
(xlii) The
Seller shall, at its own expense, cause each Mortgage Loan to be covered by
a
Tax Service Contract which is assignable to the Purchaser or its designee;
provided however, that if the Seller fails to purchase such Tax Service
Contract, the Seller shall be required to reimburse the Purchaser for all costs
and expenses incurred by the Purchaser in connection with the purchase of any
such Tax Service Contract;
(xliii) Each
Mortgage Loan is or will be covered by a Flood Zone Service Contract which
is
assignable to the Purchaser or its designee or, for each Mortgage Loan not
covered by such Flood Zone Service Contract, the Seller agrees to purchase
such
Flood Zone Service Contract;
(xliv) No
Mortgage Loan is (a)(1) subject to the provisions of the Homeownership and
Equity Protection Act of 1994 as amended (“HOEPA”) or (2) has an APR or total
points and fees that are equal to or exceeds the HOEPA thresholds (as defined
in
12 CFR 226.32 (a)(1)(i) and (ii)), (b) a “high cost” mortgage loan, “covered”
mortgage loan, “high risk home” mortgage loan, or “predatory” mortgage loan or
any other comparable term, no matter how defined under any federal, state or
local law, (c) subject to any comparable federal, state or local statutes or
regulations, or any other statute or regulation providing for heightened
regulatory scrutiny or assignee liability to holders of such mortgage loans,
or
(d) a High Cost Loan or Covered Loan, as applicable (as such terms are defined
in the current Standard & Poor’s LEVELS® Glossary Revised, Appendix
E);
(xlv) No
predatory, abusive, or deceptive lending practices, including but not limited
to, the extension of credit to a Mortgagor without regard for the Mortgagor’s
ability to repay the Mortgage Loan and the extension of credit to a Mortgagor
which has no apparent benefit to the Mortgagor, were employed in connection
with
the origination of the Mortgage Loan;
(xlvi) The
debt-to-income ratio of the related Mortgagor was not greater than 60% at the
origination of the related Mortgage Loan;
(xlvii) No
Mortgagor was required to purchase any credit insurance product (e.g., life,
mortgage, disability, accident, unemployment or health insurance product) or
debt cancellation agreement as a condition of obtaining the extension of credit.
No Mortgagor obtained a prepaid single premium credit insurance policy (e.g.,
life, mortgage, disability, accident, unemployment or health insurance product)
or debt cancellation agreement in connection with the origination of the
Mortgage Loan. No proceeds from any Mortgage Loan were used to purchase single
premium credit insurance policies or debt cancellation agreements as part of
the
origination of, or as a condition to closing, such Mortgage Loan;
(xlviii) The
Mortgage Loans were not selected from the outstanding one- to four-family
mortgage loans in the Seller’s portfolio as to which the representations and
warranties set forth in this Agreement could be made at the related Closing
Date
in a manner so as to affect adversely the interests of the
Purchaser;
(xlix) The
Mortgage contains an enforceable provision for the acceleration of the payment
of the unpaid principal balance of the Mortgage Loan in the event that the
Mortgaged Property is sold or transferred without the prior written consent
of
the mortgagee thereunder;
(l) The
Mortgage Loan complies with all applicable consumer credit statutes and
regulations, including, without limitation, the respective Uniform Consumer
Credit Code laws in effect in Alabama, Colorado, Idaho, Indiana, Iowa, Kansas,
Maine, Oklahoma, South Carolina, Utah, West Virginia and Wyoming, has been
originated by a properly licensed entity, and in all other respects, complies
with all of the material requirements of any such applicable laws;
(li) The
information set forth in the Mortgage Loan Schedule as to Prepayment Charges
is
complete, true and correct in all material respects and each Prepayment Charge
is permissible, enforceable and collectable in accordance with its terms upon
the Mortgagor’s full and voluntary principal payment under applicable
law;
(lii) The
Mortgage Loan was not prepaid in full prior to the Closing Date and the Seller
has not received notification from a Mortgagor that a prepayment in full shall
be made after the Closing Date;
(liii) No
Mortgage Loan is secured by cooperative housing, commercial property or mixed
use property;
(liv) [Reserved];
(lv) Except
as
set forth on the related Mortgage Loan Schedule, none of the Mortgage Loans
are
subject to a Prepayment Charge. For any Mortgage Loan originated prior to
October 1, 2002 that is subject to a Prepayment Charge, such Prepayment Charge
does not extend beyond five (5) years after the date of origination. For any
Mortgage Loan originated on or following October 1, 2002 that is subject to
a
Prepayment Charge, such Prepayment Charge does not extend beyond three (3)
years
after the date of origination. With respect to any Mortgage Loan that contains
a
provision permitting imposition of a penalty upon a prepayment prior to
maturity: (i) the Mortgage Loan provides some benefit to the borrower (e.g.,
a
rate or fee reduction) in exchange for accepting such prepayment penalty, (ii)
the prepayment penalty was disclosed to the Mortgagor in the loan documents
pursuant to applicable state and federal law, and (iii) such Prepayment Charge
shall not be imposed in any instance where the mortgage loan is accelerated
or
paid off in connection with the workout of a delinquent Mortgage Loan or as
the
result of the Mortgagor's default in making the loan payments, notwithstanding
that the terms of the Mortgage Loan or state or federal law might permit the
imposition of such Prepayment Charge;
(lvi) The
Seller has complied with all applicable anti-money laundering laws and
regulations, including without limitation the USA Patriot Act of 2001
(collectively, the “Anti-Money Laundering Laws”); the Seller has established an
anti-money laundering compliance program as required by the Anti-Money
Laundering Laws, has conducted the requisite due diligence in connection with
the origination of each Mortgage Loan for purposes of the Anti-Money Laundering
Laws, including with respect to the legitimacy of the applicable Mortgagor
and
the origin of the assets used by the said Mortgagor to purchase the Mortgaged
Property, and maintains, and will maintain, sufficient information to identify
the applicable Mortgagor for purposes of the Anti-Money Laundering Laws. No
Mortgage Loan is subject to nullification pursuant to Executive Order 13224
(the
“Executive Order”) or the regulations promulgated by the Office of Foreign
Assets Control of the United States Department of the Treasury (the “OFAC
Regulations”) or in violation of the Executive Order or the OFAC Regulations,
and no Mortgagor is subject to the provisions of such Executive Order or the
OFAC Regulations nor listed as a “blocked person” for purposes of the OFAC
Regulations;
(lvii) No
Mortgagor was encouraged or required to select a Mortgage Loan product offered
by the Mortgage Loan's originator which is a higher cost product designed for
less creditworthy borrowers, unless at the time of the Mortgage Loan's
origination, such Mortgagor did not qualify taking into account credit history
and debt to income ratios for a lower cost credit product then offered by the
Mortgage Loan's originator or any affiliate of the Mortgage Loan's originator.
With respect to any Mortgage Loan, the Mortgagor was assigned the highest credit
grade available with respect to a mortgage loan product offered by such Mortgage
Loan’s originator, based on a comprehensive assessment of risk factors,
including the Mortgagor’s credit history;
(lviii) The
methodology used in underwriting the extension of credit for each Mortgage
Loan
employs objective criteria which relate such facts as, without limitation,
the
Mortgagor's credit history, income, assets or liabilities (except in the case
of
loan programs which do not require the borrower to report the borrower’s income
or assets, such as “no income, no assets” lending programs or which rely on the
borrower’s representation of the borrower’s income or assets, such as “stated
income” or “stated assets” lending programs) to the proposed payment and such
underwriting methodology does not rely solely on the extent of the Mortgagor's
equity in the collateral as the principal determining factor in approving such
credit extension. Such underwriting methodology determined that at the time
of
origination (application/approval) the Mortgagor had a reasonable ability to
make timely payments on the Mortgage Loan;
(lix) With
respect to each Mortgage Loan, the Seller has fully and accurately furnished
complete information (i.e., favorable and unfavorable) on the related borrower
credit files to Equifax, Experian and Trans Union Credit Information Company,
in
accordance with the Fair Credit Reporting Act and its implementing regulations,
on a monthly basis and, for each Mortgage Loan, the Seller will furnish, in
accordance with the Fair Credit Reporting Act and its implementing regulations,
accurate and complete information on its borrower credit files to Equifax,
Experian, and Trans Union Credit Information Company, on a monthly basis during
the interim servicing period;
(lx) All
points and fees related to each Mortgage Loan were disclosed in writing to
the
related Borrower in accordance with applicable state and federal laws and
regulations;
(lxi) The
Seller will transmit full-file credit reporting data for each Mortgage Loan
pursuant to Xxxxxx Xxx Guide Announcement 95-19 and for each Mortgage Loan,
Seller agrees it shall report one of the following statuses each month as
follows: new origination, current, delinquent (30-, 60-, 90-days, etc.),
foreclosed, or charged-off;
(lxii) With
respect to any second lien Mortgage Loan, such lien is on a one- to four-family
residence that is (or will be) the principal residence or second home of the
Mortgagor upon the origination of the second lien Mortgage Loan;
(lxiii) Each
Mortgage Loan constitutes a “qualified mortgage” under
Section 860G(a)(3)(A) of the Code and Treasury Regulation
Section 1.860G-2(a)(1);
(lxiv) No
Mortgage Loan is secured by real property or secured by a manufactured home
located in the state of Georgia unless (x) such Mortgage Loan was originated
prior to October 1, 2002 or after March 6, 2003, or (y) the property securing
the Mortgage Loan is not, nor will be, occupied by the Mortgagor as the
Mortgagor’s principal dwelling. No Mortgage Loan is a “High Cost Home Loan” as
defined in the Georgia Fair Lending Act, as amended (the “Georgia Act”). Each
Mortgage Loan that is a “Home Loan” under the Georgia Act complies with all
applicable provisions of the Georgia Act. No Mortgage Loan secured by owner
occupied real property or an owner occupied manufactured home located in the
State of Georgia was originated (or modified) on or after October 1, 2002
through and including March 6, 2003;
(lxv) No
Mortgage Loan is a “High-Cost” loan as defined under the New York Banking Law
Section 6-1, effective as of April 1, 2003;
(lxvi) No
Mortgage Loan (a) is secured by property located in the State of New York;
(b)
had an unpaid principal balance at origination of $300,000 or less, and (c)
has
an application date on or after April 1, 2003, the terms of which Mortgage
Loan
equal or exceed either the APR or the points and fees threshold for “high-cost
home loans”, as defined in Section 6-1 of the New York State Banking
Law;
(lxvii) No
Mortgage Loan is a “High Cost Home Loan” as defined in the Arkansas Home Loan
Protection Act effective July 16, 2003 (Act 1340 or 2003);
(lxviii) No
Mortgage Loan is a “High Cost Home Loan” as defined in the Kentucky high-cost
loan statute effective June 24, 2003 (Ky. Rev. Stat.
Section 360.100);
(lxix) No
Mortgage Loan secured by property located in the State of Nevada is a “home
loan” as defined in the Nevada Assembly Xxxx No. 284;
(lxx) No
Mortgage Loan is a “manufactured housing loan” or “home improvement home loan”
pursuant to the New Jersey Home Ownership Act. No Mortgage Loan is a “High-Cost
Home Loan” or a refinanced “Covered Home Loan,” in each case, as defined in the
New Jersey Home Ownership Act effective November 27, 2003 (N.J.S.A. 46;10B-22
et
seq.);
(lxxi) No
Mortgage Loan is a subsection 10 mortgage under the Oklahoma Home Ownership
and
Equity protection Act;
(lxxii) No
Mortgage Loan is a “High-Cost Home Loan” as defined in the New Mexico Home Loan
Protection Act effective January 1, 2004 (N.M. Stat. Xxx. §§ 58-21A-1 et
seq.);
(lxxiii) No
Mortgage Loan is a “High-Risk Home Loan” as defined in the Illinois High-Risk
Home Loan Act effective January 1, 2004 (815 Ill. Comp. Stat. 137/1 et
seq.);
(lxxiv) No
Loan
that is secured by property located within the State of Maine meets the
definition of a (i) “high-rate, high-fee” mortgage loan under Article VIII,
Title 9-A of the Maine Consumer Credit Code or (ii) “High-Cost Home Loan” as
defined under the Maine House Xxxx 383 X.X. 494, effective as of September
13,
2003;
(lxxv) [Reserved];
(lxxvi) No
Mortgage Loan is a “High Cost Home Mortgage Loan” as defined in the
Massachusetts Predatory Home Loan Practices Act, effective November 7, 2004
(Mass. Xxx. Laws Ch. 183C). No Mortgage Loan secured by a Mortgaged Property
located in the Commonwealth of Massachusetts was made to pay off or refinance
an
existing loan or other debt of the related borrower (as the term “borrower” is
defined in the regulations promulgated by the Massachusetts Secretary of State
in connection with Massachusetts House Xxxx 4880 (2004)) unless either (1)
(a)
the related Mortgage Interest Rate (that would be effective once the
introductory rate expires, with respect to Adjustable Rate Mortgage Loans)
did
or would not exceed by more than 2.25% the yield on United States Treasury
securities having comparable periods of maturity to the maturity of the related
Mortgage Loan as of the fifteenth day of the month immediately preceding the
month in which the application for the extension of credit was received by
the
related lender or (b) the Mortgage Loan is an “open-end home loan” (as such term
is used in the Massachusetts House Xxxx 4880 (2004)) and the related Mortgage
Note provides that the related Mortgage Interest Rate may not exceed at any
time
the Prime rate index as published in The Wall Street Journal plus a margin
of
one percent, or (2) such Mortgage Loan is in the "borrower's interest," as
documented by a "borrower's interest worksheet" for the particular Mortgage
Loan, which worksheet incorporates the factors set forth in Massachusetts House
Xxxx 4880 (2004) and the regulations promulgated thereunder for determining
"borrower's interest," and otherwise complies in all material respects with
the
laws of the Commonwealth of Massachusetts;
(lxxvii) No
Loan
is a “High Cost Home Loan” as defined by the Indiana Home Loan Practices Act,
effective January 1, 2005 ( Ind. Code Xxx. §§ 24-9-1 et seq.);
(lxxviii) The
Mortgagee has not made or caused to be made any payment in the nature of an
“average” or “yield spread premium” to a mortgage broker or a like Person which
has not been fully disclosed to the Mortgagor;
(lxxix) The
sale
or transfer of the Mortgage Loan by the Seller complies with all applicable
federal, state, and local laws, rules, and regulations governing such sale
or
transfer, including, without limitation, the Fair and Accurate Credit
Transactions Act (“FACT Act”) and the Fair Credit Reporting Act, each as may be
amended from time to time, and the Seller has not received any actual or
constructive notice of any identity theft, fraud, or other misrepresentation
in
connection with such Mortgage Loan or any party thereto;
(lxxx) [Reserved];
(lxxxi) [Reserved];
(lxxxii) [Reserved];
and
(lxxxiii) No
Mortgagor agreed to submit to mandatory arbitration to resolve any dispute
arising out of or relating in any way to the Mortgage Loan transaction. No
Mortgage Loan is subject to any mandatory arbitration.
| Subsection 7.03. |
Remedies
for Breach of Representations and Warranties.
|
It
is
understood and agreed that the representations and warranties set forth in
Subsections 7.01 and 7.02 shall survive the sale of the Mortgage Loans to the
Purchaser and shall inure to the benefit of the Purchaser, notwithstanding
any
restrictive or qualified endorsement on any Mortgage Note or Assignment of
Mortgage or the examination or lack of examination of any Mortgage File. Upon
discovery by the Seller of a breach of any of the foregoing representations
and
warranties which materially and adversely affects the value of the Mortgage
Loans or the interest of the Purchaser (or which materially and adversely
affects the value of a Mortgage Loan or the interests of the Purchaser in the
related Mortgage Loan in the case of a representation and warranty relating
to a
particular Mortgage Loan), or in the event that any Mortgagor fails to make
the
first payment due to the Purchaser following the Closing Date, the Seller shall
give prompt written notice to the Purchaser.
Within
90
days of the earlier of either discovery by the Seller, or notice to the Seller,
of any breach of a representation or warranty which materially and adversely
affects the value of a Mortgage Loan or the Mortgage Loans or the Purchaser’s
interest in a Mortgage Loan or the Mortgage Loans, the Seller shall use its
best
efforts promptly to cure such breach in all material respects and, if such
breach cannot be cured, the Seller shall, at the Purchaser’s option, repurchase
such Mortgage Loan at the Repurchase Price. In the event that a breach shall
involve any representation or warranty set forth in Subsection 7.01 and
such breach cannot be cured within 90 days of the earlier of either discovery
by
or notice to the Seller of such breach, all of the Mortgage Loans shall, at
the
Purchaser’s option, be repurchased by the Seller at the Repurchase Price. The
Seller shall, at the request of the Purchaser and assuming that Seller has
a
Qualified Substitute Mortgage Loan, rather than repurchase the Mortgage Loan
as
provided above, remove such Mortgage Loan and substitute in its place a
Qualified Substitute Mortgage Loan or Loans; provided that such substitution
shall be effected not later than 120 days after the related Closing Date. If
the
Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the
deficient Mortgage Loan. Any repurchase of a Mortgage Loan(s) pursuant to the
foregoing provisions of this Subsection 7.03 shall occur on a date
designated by the Purchaser and shall be accomplished (i) during the Interim
Servicing Period by deposit in the Custodial Account of the amount of the
Repurchase Price for distribution to the Purchaser on the next scheduled
Distribution Date and (ii) following the Interim Servicing Period, by wire
transfer of immediately available funds on the repurchase date to an account
designated by the Purchaser. Notwithstanding anything to the contrary contained
herein, it is understood by the parties hereto that a breach of the
representations and warranties made in Subsections 7.02(viii), (xliv), (xlvii),
(lv), (lvii), (lviii), (lix), (lx), (lxii), (lxiii), (lxiv) or (lxxxiii) will
be
deemed to materially and adversely affect the value of the related Mortgage
Loan
or the interest of the Purchaser therein.
At
the
time of repurchase of any deficient Mortgage Loan, the Purchaser and the Seller
shall arrange for the reassignment of the repurchased Mortgage Loan to the
Seller and the delivery to the Seller of any documents held by the Custodian
relating to the repurchased Mortgage Loan. In the event the Repurchase Price
is
deposited in the Custodial Account, the Seller shall, simultaneously with such
deposit, give written notice to the Purchaser that such deposit has taken place.
Upon such repurchase the related Mortgage Loan Schedule shall be amended to
reflect the withdrawal of the repurchased Mortgage Loan from this
Agreement.
As
to any
Deleted Mortgage Loan for which the Seller substitutes a Qualified Substitute
Mortgage Loan or Loans, the Seller shall effect such substitution by delivering
to the Purchaser for such Qualified Substitute Mortgage Loan or Loans the
Mortgage Note, the Mortgage, the Assignment of Mortgage and such other documents
and agreements as are required by the Custodial Agreement, with the Mortgage
Note endorsed as required therein. The Seller shall deposit in the Custodial
Account the Monthly Payment less the Servicing Fee due on such Qualified
Substitute Mortgage Loan or Loans in the month following the date of such
substitution. Monthly Payments due with respect to Qualified Substitute Mortgage
Loans in the month of substitution will be retained by the Seller. For the
month
of substitution, distributions to the Purchaser will include the Monthly Payment
due on such Deleted Mortgage Loan in the month of substitution, and the Seller
shall thereafter be entitled to retain all amounts subsequently received by
the
Seller in respect of such Deleted Mortgage Loan. The Seller shall give written
notice to the Purchaser that such substitution has taken place and shall amend
the Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage
Loan
from the terms of this Agreement and the substitution of the Qualified
Substitute Mortgage Loan. Upon such substitution, such Qualified Substitute
Mortgage Loan or Loans shall be subject to the terms of this Agreement in all
respects, and the Seller shall be deemed to have made with respect to such
Qualified Substitute Mortgage Loan or Loans, as of the date of substitution,
the
covenants, representations and warranties set forth in Subsections 7.01 and
7.02.
For
any
month in which the Seller substitutes one or more Qualified Substitute Mortgage
Loans for one or more Deleted Mortgage Loans, the Seller will determine the
amount (if any) by which the aggregate principal balance of all such Qualified
Substitute Mortgage Loans as of the date of substitution is less than the
aggregate Stated Principal Balance of all such Deleted Mortgage Loans (after
application of scheduled principal payments due in the month of substitution).
An amount equal to the product of the amount of such shortfall multiplied by
the
greater of 100% or the Purchase Price percentage specified in the related
Confirmation shall be distributed by the Seller in the month of substitution
pursuant to the Servicing Addendum. Accordingly, on the date of such
substitution, the Seller will deposit from its own funds into the Custodial
Account an amount equal to such amount.
In
addition to such cure, repurchase and substitution obligation, the Seller shall
indemnify the Initial Purchaser and any subsequent Purchaser and hold them
harmless against any losses, damages, penalties, fines, forfeitures, reasonable
and necessary legal fees and related costs, judgments, and other costs and
expenses resulting from any claim, demand, defense or assertion based on or
grounded upon, or resulting from, a breach of the Seller's representations
and
warranties contained in this Section 7. It is understood and agreed that
the obligations of the Seller set forth in this Subsection 7.03 to cure or
repurchase a defective Mortgage Loan and to indemnify the Initial Purchaser
and
any subsequent Purchaser as provided in this Subsection 7.03 constitute the
sole remedies of the Initial Purchaser and any subsequent Purchaser respecting
a
breach of the foregoing representations and warranties.
Any
cause
of action against the Seller relating to or arising out of the breach of any
representations and warranties made in Subsections 7.01 or 7.02 shall accrue
as
to any Mortgage Loan upon (i) discovery of such breach by the Purchaser or
notice thereof by the Seller to the Purchaser and (ii) demand upon the Seller
by
the Purchaser for compliance with the relevant provisions of this
Agreement.
In
addition to the foregoing, in the event that a breach of any representation
of
the Seller materially and adversely affects the interests of the Purchaser
in
any Prepayment Charge or the collectability of such Prepayment Charge, the
Seller shall pay the amount of the scheduled Prepayment Charge to the Purchaser
upon the payoff of any related Mortgage Loan.
| Subsection 7.04. |
Repurchase
of Certain Mortgage Loans; Premium Protection.
|
(a) In
the
event that (i) the first Due Date for a Mortgage Loan is prior to the Cut-off
Date and the initial Monthly Payment is not made by the related Mortgagor within
thirty (30) days of such Due Date or (ii) the first Monthly Payment on any
Mortgage Loan due following the Cut-off Date is not made by the related
Mortgagor within thirty (30) days of the related Due Date, then, in each such
case, the Seller shall repurchase the affected Mortgage Loans at the Repurchase
Price, which shall be paid as provided for in Subsection 7.03. The
Purchaser agrees to notify the Seller within ninety (90) days following the
date
on which any Mortgage Loan to be repurchased hereunder becomes thirty (30)
days
delinquent of the occurrence of such default under this Subsection
7.04(a).
(b) In
the
event that any Mortgage Loan prepays-in-full within three (3) months following
the related Closing Date (or such other period specified in the related
Confirmation), Seller shall remit to the Initial Purchaser an amount equal
to
the product of (i) the excess of (A) the percentage of par as stated in the
related Confirmation as the purchase price percentage (subject to adjustment
as
provided therein) over (B) 100%, times (ii) the outstanding principal balance
of
such Mortgage Loan as of the Cut-off Date less (iii) (A) with respect to any
payment made during the Interim Servicing Period, any prepayment penalties
received or waived by Purchaser or its successor in interest, or (B) with
respect to any payment made following the Servicing Transfer Date, any
prepayment penalties provided for in the related Mortgage Note, unless such
prepayment penalty is unenforceable pursuant to applicable state or federal
law.
Such obligation to the Initial Purchaser shall survive any sale or assignment
of
the Mortgage Loans by the Initial Purchaser to any third party and shall be
independently enforceable by the Initial Purchaser.
(c) In
the
event that any Mortgage Loan is repurchased pursuant to Section 7.03 or 7.04(a),
in addition to its obligations under Section 7.03 and 7.04(a), Seller shall
remit to the Initial Purchaser an amount equal to (1) during the first twelve
(12) months following the related Closing Date, the product of (i) the excess
of
(A) the percentage of par as stated in the related Confirmation as the purchase
price percentage (subject to adjustment as provided therein) over (B) 100%,
times (ii) the outstanding principal balance of such Mortgage Loan as of the
date of repurchase, or (2) thereafter (i) the outstanding principal balance
of
such Mortgage Loan as of the date of repurchase, plus (ii) accrued interest
thereon to the day prior to the day of repurchase. Such obligation to the
Initial Purchaser shall survive any sale or assignment of the Mortgage Loans
by
the Initial Purchaser to any third party and shall be independently enforceable
by the Initial Purchaser.
SECTION
8. Closing.
The
closing for each Mortgage Loan Package shall take place on the related Closing
Date. At the Initial Purchaser's option, the closing shall be either: by
telephone, confirmed by letter or wire as the parties shall agree, or conducted
in person, at such place as the parties shall agree.
The
closing for the Mortgage Loans to be purchased on each Closing Date shall be
subject to each of the following conditions:
| (a) |
all
of the representations and warranties of the Seller under this Agreement
shall be true and correct as of the related Closing Date and no event
shall have occurred which, with notice or the passage of time, would
constitute a default under this
Agreement;
|
| (b) |
the
Initial Purchaser shall have received, or the Initial Purchaser's
attorneys shall have received in escrow, all Closing Documents as
specified in Section 9, in such forms as are agreed upon and
acceptable to the Initial Purchaser, duly executed by all signatories
other than the Initial Purchaser as required pursuant to the terms
hereof;
|
| (c) |
the
Seller shall have delivered and released to the Custodian the Mortgage
Loan Documents; and
|
| (d) |
all
other terms and conditions of this Agreement shall have been complied
with.
|
Subject
to the foregoing conditions, the Initial Purchaser shall pay to the Seller
on
the related Closing Date the Purchase Price, plus accrued interest pursuant
to
Section 4, by wire transfer of immediately available funds to the account
designated by the Seller.
SECTION
9. Closing
Documents.
| (a) |
On
or before the Initial Closing Date, the Seller shall submit to the
Initial
Purchaser fully executed originals of the following
documents:
|
| 1. |
this
Agreement, in four counterparts;
|
| 2. |
the
Custodial Agreement, in six counterparts;
|
| 3. |
a
Custodial Account Letter Agreement in the form attached as Exhibit
7
hereto;
|
| 4. |
as
Escrow Account Letter Agreement in the form attached as Exhibit
8
hereto;
|
| 5. |
an
Officer's Certificate, in the form of Exhibit
1
hereto, including all attachments
thereto;
|
| 6. |
an
Opinion of Counsel to the Seller, in the form of Exhibit
2
hereto;
|
| 7. |
the
Seller's Underwriting Guidelines.
|
| (b) |
The
Closing Documents for the Mortgage Loans to be purchased on each Closing
Date shall consist of fully executed originals of the following
documents:
|
| 1. |
the
related Confirmation;
|
| 2. |
the
related Mortgage Loan Schedule, one copy to be attached hereto and
one
copy to be attached to the Custodian's counterpart of the Custodial
Agreement, as the Mortgage Loan Schedule
thereto;
|
| 3. |
a
Custodian's Trust Receipt and Initial Certification, as required under
the
Custodial Agreement, in a form acceptable to the Initial
Purchaser;
|
| 4. |
an
Officer's Certificate, in the form of Exhibit
1
hereto, including all attachments
thereto;
|
| 5. |
if
requested by the Initial Purchaser, an Opinion of Counsel to the Seller,
in the form of Exhibit
2
hereto;
|
| 6. |
a
Security Release Certification, in the form of Exhibit
3
hereto executed by any Person, as requested by the Initial Purchaser,
if
any of the Mortgage Loans has at any time been subject to any security
interest, pledge or hypothecation for the benefit of such
Person;
|
| 7. |
a
certificate or other evidence of merger or change of name, signed or
stamped by the applicable regulatory authority, if any of the Mortgage
Loans were acquired by the Seller by merger or acquired or originated
by
the Seller while conducting business under a name other than its present
name, if applicable;
|
| 8. |
an
Assignment and Conveyance in the form of Exhibit
4
hereto; and
|
| 9. |
in
the event that the Seller’s Underwriting Guidelines have been modified
following delivery to the Initial Purchaser, an updated copy of such
Underwriting Guidelines.
|
SECTION
10. Costs.
The
Purchaser shall pay any fees and expenses relating to the due diligence review
of the Mortgage Files, commissions due its salesmen, the fees of the Custodian,
fees for recording each Assignment of Mortgage, shipping fees, and the legal
fees and expenses of its attorneys. Fees for title policy endorsements and
continuations, and the Seller's attorney's fees, shall be paid by the
Seller.
Unless
specifically provided otherwise in this Agreement or the related Confirmation,
all costs and expenses incurred in connection with the transfer and delivery
of
the Mortgage Loans shall be paid by the Purchaser.
SECTION
11. Seller's
Servicing Obligations.
The
Seller, as independent contract servicer, shall service and administer the
Mortgage Loans during the Interim Servicing Period,
directly or through one or more Subservicers,
in
accordance with the terms and provisions set forth in the Servicing Addendum
attached as Exhibit 9, which Servicing Addendum is incorporated herein by
reference.
The
Seller shall transfer the servicing of the Mortgage Loans to the successor
servicer designated by the Purchaser in accordance with the terms of the
servicing transfer procedures provided by the Purchaser or such designated
successor servicer. In addition, with respect to any Mortgage Loan that is
not
subject to an assignable life of loan Flood Zone Service Contract or Tax
Servicer Contract as of the related Closing Date, the Seller shall pay the
Purchaser sixty dollars ($60.00) for each Mortgage Loan without an assignable
Tax Service Contract.
| SECTION 12. |
Removal
of Mortgage Loans from Inclusion under This Agreement Upon a Whole
Loan
Transfer or a Securitization Transaction on One or More Reconstitution
Dates.
|
The
Seller and the Purchaser agree that with respect to some or all of the Mortgage
Loans, the Purchaser may effect either:
(1)
one
or
more Whole Loan Transfers; and/or
(2)
one
or
more Securitization Transactions.
With
respect to each Whole Loan Transfer or Securitization Transaction, as the case
may be, entered into by the Purchaser, the Seller agrees:
| (1) |
to
cooperate fully with the Purchaser and any prospective purchaser with
respect to all reasonable requests and due diligence procedures,
preparation of the Mortgage Loan Documents and servicing transfer
requirements;
|
| (2) |
to
execute all Reconstitution Agreements, which may include, without
limitation, an Assignment and Recognition Agreement in substantially
the
form attached hereto as Exhibit 10 and an Indemnification Agreement
in
substantially the form attached hereto as Exhibit 11, provided that
each
of the Seller and the Purchaser is given an opportunity to review and
reasonably negotiate in good faith the content of such other documents
not
specifically referenced or provided for herein; provided, however,
that in
the event more than three (3) Whole Loan Transfers or Securitization
Transactions (in the aggregate) are conducted with
respect to any Mortgage Loan Package,
the Purchaser shall pay the Seller’s attorney’s fees and expenses with
respect to each transfer after the third
transfer;
|
| (3) |
with
respect to any Whole Loan Transfer or Securitization Transaction, or
any
transfer of servicing with respect to any Mortgage Loans, the Seller
shall
make the representations and warranties regarding the Seller and the
Mortgage Loans set forth herein, as of (i) the date of the Whole Loan
Transfer, Securitization Transaction or servicing transfer with respect
to
the origination of the Mortgage Loans and the representations and
warranties in Section 7.01 hereto and (ii) the servicing transfer date
with respect to the servicing of the Mortgage Loans, modified to the
extent necessary to accurately reflect the pool statistics of the Mortgage
Loans as of the date of such Whole Loan Transfer, Securitization
Transaction or servicing transfer and any events or circumstances existing
subsequent to the related Closing
Date(s);
|
| (4) |
in
a Securitization Transaction in which the aggregate outstanding principal
amount of the Mortgage Loans comprises 20% (or such other percentage
as
may be required by the Commission) or more of the aggregate principal
amount of the mortgage loans in such securitization Transaction, to
deliver to the Purchaser for inclusion in any prospectus or other offering
material such publicly available information regarding the Seller’s
underwriting standards, the Seller, its financial condition and its
mortgage loan delinquency, foreclosure and loss experience and any
additional information reasonably requested by the Purchaser, within
five
(5) Business Days following such request, including, without limitation,
information on the Mortgage Loans and the Seller’s underwriting standards,
and to deliver to the Purchaser any similar non public, unaudited
financial information, in which case the Purchaser shall bear the cost
of
having such information audited by certified public accountants if
the
Purchaser desires such an audit, or as is otherwise reasonably requested
by the Purchaser and which the Seller is capable of providing without
unreasonable effort or expense, and to indemnify the Purchaser and
its
affiliates for material misstatements or omissions or any alleged
misstatements or omissions contained in such
information;
|
| (5) |
to
deliver to the Purchaser and to any Person designated by the Purchaser,
at
the Purchaser’s expense, such statements and audit letters of reputable,
certified public accountants pertaining to information provided by
the
Seller pursuant to clause 4 above as shall be reasonably requested
by the
Purchaser;
|
| (6) |
to
deliver to the Purchaser, and to any Person designated by the Purchaser,
such legal documents and in-house Opinions of Counsel as are customarily
delivered by originators or servicers, as the case may be, and reasonably
determined by the Purchaser to be necessary in connection with Whole
Loan
Transfers or Securitization Transactions, as the case may be, such
in-house Opinions of Counsel for a Securitization Transaction to be
in the
form reasonably acceptable to the Purchaser, it being understood that
the
cost of any opinions of outside special counsel that may be required
for a
Whole Loan Transfer or Securitization Transaction, as the case may
be,
shall be the responsibility of the Purchaser; provided that the Seller
shall only be required to deliver such Opinions of Counsel in connection
with a Securitization Transaction to the extent it is required to provide
information pursuant to Section 13.03(i), (ii) or (iii) hereto;
and
|
| (7) |
in
the event that the Mortgage Loans become subject to a Securitization
Transaction prior to the termination of the Interim Servicing Period,
the
Seller agrees to service the Mortgage Loans on a scheduled/scheduled
basis
including making advances of delinquent scheduled payments of principal
and interest through liquidation (unless deemed non-recoverable) and
paying compensating interest with respect to prepayment interest
shortfalls (to the extent of the monthly servicing fee payable
thereto).
|
| SECTION 13. |
COMPLIANCE
WITH REGULATION AB
|
| Subsection 13.01. |
Intent
of the Parties; Reasonableness.
|
The
Purchaser and the Seller acknowledge and agree that the purpose of Section
13 of
this Agreement is to facilitate compliance by the Purchaser and any Depositor
with the provisions of Regulation AB and related rules and regulations of the
Commission. Although Regulation AB is applicable by its terms only to offerings
of asset-backed securities that are registered under the Securities Act, the
Seller acknowledges that investors in privately offered securities may require
that the Purchaser or any Depositor provide comparable disclosure in
unregistered offerings. References in this Agreement to compliance with
Regulation AB include provision of comparable disclosure in private offerings.
Neither
the Purchaser nor any Depositor shall exercise its right to request delivery
of
information or other performance under these provisions other than in good
faith, or for purposes other than compliance with the Securities Act, the
Exchange Act and the rules and regulations of the Commission thereunder (or
the
provision in a private offering of disclosure comparable to that required under
the Securities Act). The Seller acknowledges
that interpretations of the requirements of Regulation AB may change over time,
whether due to interpretive guidance provided by the Commission or its staff,
consensus among participants in the asset-backed securities markets, advice
of
counsel, or otherwise, and agrees to comply with reasonable requests made in
good faith by the Purchaser, any Master Servicer or any Depositor for delivery
of information under these provisions on the basis of evolving interpretations
of Regulation AB that are based on interpretive guidance provided by the
Commission or its staff or consensus among participants in the asset-backed
securities markets and to cooperate with the Purchaser with respect to any
such
requests that are based on advice of counsel or otherwise. In
connection with any Securitization Transaction, the Seller shall cooperate
fully
with the Purchaser and the Master Servicer to deliver to the Purchaser and
the
Master Servicer (including any of their assignees or designees) and any
Depositor, any and all statements, reports, certifications, records and any
other information necessary in the good faith determination of the Purchaser,
the Master Servicer or any Depositor to permit the Purchaser, the Master
Servicer or such Depositor to comply with the provisions of Regulation AB,
together with such disclosures relating to the Seller, any Subservicer, any
Third-Party Originator and the Mortgage Loans, or the servicing of the Mortgage
Loans, reasonably believed by the Purchaser or any Depositor to be necessary
in
order to effect such compliance.
The
Purchaser (including any of its assignees or designees) shall cooperate with
the
Seller by providing timely notice of requests for information under these
provisions and by reasonably limiting such requests to information required,
in
the Purchaser’s reasonable judgment, to comply with Regulation AB.
| Subsection 13.02. |
Additional
Representations and Warranties of the Seller.
|
(i) The
Seller shall be deemed to represent to the Purchaser, to any Master Servicer
and
to any Depositor, as of the date on which information is first provided to
the
Purchaser, any Master Servicer or any Depositor under Section 13.03 that, except
as disclosed in writing to the Purchaser, such Master Servicer or such Depositor
prior to such date: (i) the Seller is not aware and has not received notice
that
any default, early amortization or other performance triggering event has
occurred as to any other securitization due to any act or failure to act of
the
Seller; (ii) the Seller has not been terminated as servicer in a residential
mortgage loan securitization, either due to a servicing default or to
application of a servicing performance test or trigger; (iii) no material
noncompliance with the applicable servicing criteria with respect to other
securitizations of residential mortgage loans involving the Seller as servicer
has been disclosed or reported by the Seller; (iv) no material changes to the
Seller’s policies or procedures with respect to the servicing function it will
perform under this Agreement and any Reconstitution Agreement for mortgage
loans
of a type similar to the Mortgage Loans have occurred during the three-year
period immediately preceding the related Securitization Transaction; (v) there
are no aspects of the Seller’s financial condition that could have a material
adverse effect on the performance by the Seller of its servicing obligations
under this Agreement or any Reconstitution Agreement; (vi) there are no material
legal or governmental proceedings pending (or known to be contemplated) against
the Seller, any Subservicer or any Third-Party Originator; and (vii) there
are
no affiliations, relationships or transactions relating to the Seller, any
Subservicer or any Third-Party Originator with respect to any Securitization
Transaction and any party thereto identified by the related Depositor of a
type
described in Item 1119 of Regulation AB.
(ii) If
so
requested by the Purchaser, any Master Servicer or any Depositor on any date
following the date on which information is first provided to the Purchaser,
any
Master Servicer or any Depositor under Section 13.03, the Seller shall, within
five Business Days following such request, confirm in writing the accuracy
of
the representations and warranties set forth in paragraph (a) of this Section
or, if any such representation and warranty is not accurate as of the date
of
such request, provide reasonably adequate disclosure of the pertinent facts,
in
writing, to the requesting party.
| Subsection 13.03. |
Information
to Be Provided by the Seller.
|
In
connection with any Securitization Transaction the Seller shall, subject to
the
limitation set forth in the related Confirmation, (i) within five Business
Days
following request by the Purchaser or any Depositor, provide to the Purchaser
and such Depositor (or, as applicable, cause each Third-Party Originator and
each Subservicer to provide), in writing and in form and substance reasonably
satisfactory to the Purchaser and such Depositor, the information and materials
specified in paragraphs (i), (ii), (iii) and (vi) of this Section, and (ii)
as
promptly as practicable following notice to or discovery by the Seller, provide
to the Purchaser and any Depositor (in writing and in form and substance
reasonably satisfactory to the Purchaser and such Depositor) the information
specified in paragraph (iv) of this Section.
(i) If
so
requested by the Purchaser or any Depositor, in a Securitization Transaction
in
which the aggregate outstanding principal amount of the Mortgage Loans comprises
20% (or such other percentage as may be required by the Commission) or more
of
the aggregate principal amount of the mortgage loans in such securitization
Transaction, within five (5) Business Days following such request the Seller
shall provide such information regarding (i) the Seller, as originator of the
Mortgage Loans (including as an acquirer of Mortgage Loans from a Qualified
Correspondent), or (ii) each Third-Party Originator, and (iii) as applicable,
each Subservicer, as is requested for the purpose of compliance with Items
1103(a)(1), 1105, 1110, 1117 and 1119 of Regulation AB. Such information shall
include, at a minimum:
| (a) |
the
originator’s form of organization;
|
| (b) |
a
description of the originator’s origination program and how long the
originator has been engaged in originating residential mortgage loans,
which description shall include a discussion of the originator’s
experience in originating mortgage loans of a similar type as the Mortgage
Loans; information regarding the size and composition of the originator’s
origination portfolio; and information that may be material, in the
good
faith judgment of the Purchaser or any Depositor, to an analysis of
the
performance of the Mortgage Loans, including the originators’
credit-granting or underwriting criteria for mortgage loans of similar
type(s) as the Mortgage Loans and such other information as the Purchaser
or any Depositor may reasonably request for the purpose of compliance
with
Item 1110(b)(2) of Regulation AB;
|
| (c) |
a
description of any material legal or governmental proceedings pending
(or
known to be contemplated) against the Seller, each Third-Party Originator
and each Subservicer; and
|
| (d) |
a
description of any affiliation or relationship between the Seller,
each
Third-Party Originator, each Subservicer and any of the following parties
to a Securitization Transaction, as such parties are identified to
the
Seller by the Purchaser or any Depositor in writing in advance of such
Securitization Transaction:
|
(1) the
sponsor;
(2) the
depositor;
(3) the
issuing entity;
(4) any
servicer;
(5) any
trustee;
(6) any
originator;
(7) any
significant obligor;
(8) any
enhancement or support provider; and
(9) any
other
material transaction party.
(ii) If
so
requested by the Purchaser or any Depositor, in a Securitization Transaction
in
which the aggregate outstanding principal amount of the Mortgage Loans comprises
20% (or such other percentage as may be required by the Commission) or more
of
the aggregate principal amount of the mortgage loans in such securitization
Transaction, within five (5) Business Days following such request the Seller
shall provide (or, as applicable, cause each Third-Party Originator to provide)
Static Pool Information with respect to the mortgage loans (of a similar type
as
the Mortgage Loans, as reasonably identified by the Purchaser as provided below)
originated by (i) the Seller, if the Seller is an originator of Mortgage Loans
(including as an acquirer of Mortgage Loans from a Qualified Correspondent),
and/or (ii) each Third-Party Originator. Such Static Pool Information shall
be
prepared by the Seller (or Third-Party Originator) on the basis of its
reasonable, good faith interpretation of the requirements of Item 1105(a)(1)-(3)
of Regulation AB. To the extent that there is reasonably available to the Seller
(or Third-Party Originator) Static Pool Information with respect to more than
one mortgage loan type, the Purchaser or any Depositor shall be entitled to
specify whether some or all of such information shall be provided pursuant
to
this paragraph. The content of such Static Pool Information may be in the form
customarily provided by the Seller, and need not be customized for the Purchaser
or any Depositor. Such Static Pool Information for each vintage origination
year
or prior securitized pool, as applicable, shall be presented in increments
no
less frequently than quarterly over the life of the mortgage loans included
in
the vintage origination year or prior securitized pool. The most recent periodic
increment must be as of a date no later than 135 days prior to the date of
the
prospectus or other offering document in which the Static Pool Information
is to
be included or incorporated by reference. The Static Pool Information shall
be
provided in an electronic format that provides a permanent record of the
information provided, such as a portable document format (pdf) file, or other
such electronic format reasonably required by the Purchaser or the Depositor,
as
applicable.
Promptly
following notice or discovery of a material error in Static Pool Information
provided pursuant to the immediately preceding paragraph (including an omission
to include therein information required to be provided pursuant to such
paragraph), the Seller shall provide corrected Static Pool Information to the
Purchaser or any Depositor, as applicable, in the same format in which Static
Pool Information was previously provided to such party by the
Seller.
If
so
requested by the Purchaser or any Depositor, in a Securitization Transaction
in
which the aggregate outstanding principal amount of the Mortgage Loans comprises
20% (or such other percentage as may be required by the Commission) or more
of
the aggregate principal amount of the mortgage loans in such securitization
Transaction, within five (5) Business Days following such request the Seller
shall provide (or, as applicable, cause each Third-Party Originator to provide),
at the expense of the requesting party (to the extent of any additional
incremental expense associated with delivery pursuant to this Agreement), such
agreed-upon procedures letters of certified public accountants reasonably
acceptable to the Purchaser or Depositor, as applicable, pertaining to Static
Pool Information relating to prior securitized pools for securitizations closed
on or after January 1, 2006 or, in the case of Static Pool Information with
respect to the Seller’s or Third-Party Originator’s originations or purchases,
to calendar months commencing January 1, 2006, as the Purchaser or such
Depositor shall reasonably request. Such letters shall be addressed to and
be
for the benefit of such parties as the Purchaser or such Depositor shall
designate, which may include, by way of example, any Sponsor, any Depositor
and
any broker dealer acting as underwriter, placement agent or initial purchaser
with respect to a Securitization Transaction. Any such statement or letter
may
take the form of a standard, generally applicable document accompanied by a
reliance letter authorizing reliance by the addressees designated by the
Purchaser or such Depositor.
(iii) If
so
requested by the Purchaser or any Depositor, the Seller shall provide such
information regarding the Seller, as servicer of the Mortgage Loans, and each
Subservicer (each of the Seller and each Subservicer, for purposes of this
paragraph, a “Servicer”), as is requested for the purpose of compliance with
Items 1108, 1117 and 1119 of Regulation AB. Such information shall include,
at a
minimum:
| (a) |
the
Servicer’s form of organization;
|
| (b) |
a
description of how long the Servicer has been servicing residential
mortgage loans; a general discussion of the Servicer’s experience in
servicing assets of any type as well as a more detailed discussion
of the
Servicer’s experience in, and procedures for, the servicing function it
will perform under this Agreement and any Reconstitution Agreements;
information regarding the size, composition and growth of the Servicer’s
portfolio of residential mortgage loans of a type similar to the Mortgage
Loans and information on factors related to the Servicer that may be
material, in the good faith judgment of the Purchaser or any Depositor,
to
any analysis of the servicing of the Mortgage Loans or the related
asset-backed securities, as applicable, including, without
limitation:
|
| 1. |
whether
any prior securitizations of mortgage loans of a type similar to the
Mortgage Loans involving the Servicer have defaulted or experienced
an
early amortization or other performance triggering event because of
servicing during the three-year period immediately preceding the related
Securitization Transaction;
|
| 2. |
the
extent of outsourcing the Servicer
utilizes;
|
| 3. |
whether
there has been previous disclosure of material noncompliance with the
applicable servicing criteria with respect to other securitizations
of
residential mortgage loans involving the Servicer as a servicer during
the
three-year period immediately preceding the related Securitization
Transaction;
|
| 4. |
whether
the Servicer has been terminated as servicer in a residential mortgage
loan securitization, either due to a servicing default or to application
of a servicing performance test or trigger;
and
|
| 5. |
such
other information as the Purchaser or any Depositor may reasonably
request
for the purpose of compliance with Item 1108(b)(2) of Regulation
AB;
|
| (c) |
a
description of any material changes during the three-year period
immediately preceding the related Securitization Transaction to the
Servicer’s policies or procedures with respect to the servicing function
it will perform under this Agreement and any Reconstitution Agreements
for
mortgage loans of a type similar to the Mortgage
Loans;
|
| (d) |
information
regarding the Servicer’s financial condition, to the extent that there is
a material risk that an adverse financial event or circumstance involving
the Servicer could have a material adverse effect on the performance
by
the Seller of its servicing obligations under this Agreement or any
Reconstitution Agreement;
|
| (e) |
information
regarding advances made by the Servicer on the Mortgage Loans and the
Servicer’s overall servicing portfolio of residential mortgage loans for
the three-year period immediately preceding the related Securitization
Transaction, which may be limited to a statement by an authorized officer
of the Servicer to the effect that the Servicer has made all advances
required to be made on residential mortgage loans serviced by it during
such period, or, if such statement would not be accurate, information
regarding the percentage and type of advances not made as required,
and
the reasons for such failure to advance;
|
| (f) |
a
description of the Servicer’s processes and procedures designed to address
any special or unique factors involved in servicing loans of a similar
type as the Mortgage Loans;
|
| (g) |
a
description of the Servicer’s processes for handling delinquencies,
losses, bankruptcies and recoveries, such as through liquidation of
mortgaged properties, sale of defaulted mortgage loans or
workouts;
|
| (h) |
information
as to how the Servicer defines or determines delinquencies and
charge-offs, including the effect of any grace period, re-aging,
restructuring, partial payments considered current or other practices
with
respect to delinquency and loss
experience;
|
| (i) |
a
description of any material legal or governmental proceedings pending
(or
known to be contemplated) against the Servicer;
and
|
| (j) |
a
description of any affiliation or relationship between the Servicer
and
any of the following parties to a Securitization Transaction, as such
parties are identified to the Servicer by the Purchaser or any Depositor
in writing in advance of such Securitization
Transaction:
|
(1) the
sponsor;
(2) the
depositor;
(3) the
issuing entity;
(4) any
servicer;
(5) any
trustee;
(6) any
originator;
(7) any
significant obligor;
(8) any
enhancement or support provider; and
(9) any
other
material transaction party.
(iv) If
so
requested by the Purchaser, any Master Servicer or any Depositor for the purpose
of satisfying its reporting obligation under the Exchange Act with respect
to
any class of asset-backed securities, the Seller shall (or shall cause each
Subservicer and Third-Party Originator to) (i) provide prompt notice to the
Purchaser, any Master Servicer and any Depositor in writing of (A) any material
litigation or governmental proceedings involving the Seller, any Subservicer
or
any Third-Party Originator, (B) any affiliations or relationships that develop
following the closing date of a Securitization Transaction between the Seller,
any Subservicer or any Third-Party Originator and any of the parties specified
in clause (d) of paragraph (i) of this Section (and any other parties identified
in writing by the requesting party) with respect to such Securitization
Transaction, (C) any Event of Default under the terms of this Agreement or
any
Reconstitution Agreement, (D) any merger, consolidation or sale of substantially
all of the assets of the Seller, and (E) the Seller’s entry into an agreement
with a Subservicer or Subcontractor to perform or assist in the performance
of
any of the Servicer’s obligations under this Agreement or any Reconstitution
Agreement and (ii) provide to the Purchaser and any Depositor a description
of
such proceedings, affiliations or relationships.
(v) As
a
condition to the succession to the Seller or any Subservicer as servicer or
subservicer under this Agreement or any Reconstitution Agreement by any Person
(i) into which the Seller or such Subservicer may be merged or consolidated,
or
(ii) which may be appointed as a successor to the Seller or any Subservicer,
the
Seller shall provide to the Purchaser and any Depositor, at least 15 calendar
days prior to the effective date of such succession or appointment, (x) written
notice to the Purchaser and any Depositor of such succession or appointment
and
(y) in writing and in form and substance reasonably satisfactory to the
Purchaser and such Depositor, all information reasonably requested by the
Purchaser or any Depositor in order to comply with its reporting obligation
under Item 6.02 of Form 8-K with respect to any class of asset-backed
securities.
(vi) In
addition to such information as the Seller, as servicer, is obligated to provide
pursuant to other provisions of this Agreement, if so requested by the Purchaser
or any Depositor, the Seller shall provide such additional information as such
party may reasonably request, including evidence of the authorization of the
person signing any certification or statement, financial information and
reports, and such other information related to the Seller or any Subservicer
or
the Seller or such Subservicer’s performance hereunder and such information
regarding the performance or servicing of the Mortgage Loans as is reasonably
required to facilitate preparation of distribution reports in accordance with
Item 1121 of Regulation AB. Such information shall be provided concurrently
with
the monthly reports otherwise required to be delivered by the servicer under
this Agreement, commencing with the first such report due not less than ten
Business Days following such request.
(vii) In
addition to such information as the Seller, as servicer, is obligated to provide
pursuant to other provisions of this Agreement, not later than ten days prior
to
the deadline for the filing of any distribution report on Form 10-D in respect
of any Securitization Transaction that includes any of the Mortgage Loans
serviced by the Seller or any Subservicer, the Seller or such Subservicer,
as
applicable, shall provide to the party responsible for filing such report
(including, if applicable, the Master Servicer) notice of the occurrence of
any
of the following events along with all information, data, and materials related
thereto as may be required to be included in the related distribution report
on
Form 10-D (as specified in the provisions of Regulation AB referenced
below):
(i) any
material modifications, extensions or waivers of pool asset terms, fees,
penalties or payments during the distribution period or that have cumulatively
become material over time (Item 1121(a)(11) of Regulation AB);
(ii) material
breaches of pool asset representations or warranties or transaction covenants
(Item 1121(a)(12) of Regulation AB); and
(iii) information
regarding any pool asset changes (such as, additions, substitutions or
repurchases).
| Subsection 13.04. |
Servicer
Compliance Statement.
|
On
or
before March 1 of each calendar year, commencing in 2007, provided that the
Seller has serviced the Mortgage Loans during the preceding calendar year,
the
Seller shall deliver to the Purchaser, any Master Servicer and any Depositor
a
statement of compliance addressed to the Purchaser and such Depositor and signed
by an authorized officer of the Seller, to the effect that (i) a review of
the
Seller’s activities during the immediately preceding calendar year (or
applicable portion thereof) and of its performance under this Agreement and
any
applicable Reconstitution Agreement during such period has been made under
such
officer’s supervision, and (ii) to the best of such officers’ knowledge, based
on such review, the Seller has fulfilled all of its obligations under this
Agreement and any applicable Reconstitution Agreement in all material respects
throughout such calendar year (or applicable portion thereof) or, if there
has
been a failure to fulfill any such obligation in any material respect,
specifically identifying each such failure known to such officer and the nature
and the status thereof. In the event the Seller has delegated any servicing
responsibilities with respect to the Mortgage Loans to one or more Subservicers,
Seller shall deliver an officer’s statement of the Subservicer(s) as and when
such statements are required under this Subsection.
| Subsection 13.05. |
Report
on Assessment of Compliance and Attestation.
|
(i) On
or
before March 1 of each calendar year, commencing in 2007, provided that the
Seller has serviced the Mortgage Loans during the preceding calendar year,
the
Seller shall:
(1) deliver
to the Purchaser, any Master Servicer and any Depositor a report (in form and
substance reasonably satisfactory to the Purchaser, such Master Servicer and
such Depositor) regarding the Seller’s assessment of compliance with the
Servicing Criteria during the immediately preceding calendar year, as required
under Rules 13a-18 and 15d-18 of the Exchange Act and Item 1122 of Regulation
AB. Such report shall be addressed to the Purchaser, such Master Servicer and
such Depositor and signed by an authorized officer of the Seller, and shall
address each of the Servicing Criteria specified on a certification
substantially in the form of Exhibit 15 hereto delivered to the Purchaser
concurrently with the execution of this Agreement;
(2) deliver
to the Purchaser, any Master Servicer and any Depositor a report of a registered
public accounting firm reasonably acceptable to the Purchaser, such Master
Servicer and such Depositor that attests to, and reports on, the assessment
of
compliance made by the Seller and delivered pursuant to the preceding paragraph.
Such attestation shall be in accordance with Rules 1-02(a)(3) and 2-02(g) of
Regulation S-X under the Securities Act and the Exchange Act;
(3) cause
each Subservicer, and each Subcontractor determined by the Seller pursuant
to
Section 13.06(ii) to be “participating in the servicing function” within the
meaning of Item 1122 of Regulation AB, to deliver to the Purchaser, any Master
Servicer and any Depositor an assessment of compliance and accountants’
attestation as and when provided in paragraphs (i) and (ii) of this Section;
and
(4) if
requested by the Purchaser or any Depositor not later than February 1 of the
calendar year in which such certification is to be delivered, deliver to the
Purchaser, any Depositor and any other Person that will be responsible for
signing the certification (a “Sarbanes Certification”) required by Rules
13a-14(d) and 15d-14(d) under the Exchange Act (pursuant to Section 302 of
the
Xxxxxxxx-Xxxxx Act of 2002) on behalf of an asset-backed issuer with respect
to
a Securitization Transaction a certification in the form attached hereto as
Exhibit 14.
The
Seller acknowledges that the parties identified in clause (i)(4) above may
rely
on the certification provided by the Seller pursuant to such clause in signing
a
Sarbanes Certification and filing such with the Commission. Neither the
Purchaser nor any Depositor will request delivery of a certification under
clause (i)(4) above unless a Depositor is required under the Exchange Act to
file an annual report on Form 10-K with respect to an issuing entity whose
asset
pool includes Mortgage Loans.
(ii) Each
assessment of compliance provided by a Subservicer pursuant to Section
13.05(i)(1) shall address each of the Servicing Criteria specified on a
certification substantially in the form of Exhibit 15 hereto delivered to the
Purchaser concurrently with the execution of this Agreement or, in the case
of a
Subservicer subsequently appointed as such, on or prior to the date of such
appointment. An assessment of compliance provided by a Subcontractor pursuant
to
Section 13.05(i)(3) need not address any elements of the Servicing Criteria
other than those specified by the Seller pursuant to Section 13.06.
| Subsection 13.06. |
Use
of Subservicers and Subcontractors.
|
The
Seller shall not hire or otherwise utilize the services of any Subservicer
to
fulfill any of the obligations of the Seller as servicer under this Agreement
or
any Reconstitution Agreement unless the Seller complies with the provisions
of
paragraph (i) of this Section. The Seller shall not hire or otherwise utilize
the services of any Subcontractor, and shall not permit any Subservicer to
hire
or otherwise utilize the services of any Subcontractor, to fulfill any of the
obligations of the Seller as servicer under this Agreement or any Reconstitution
Agreement unless the Seller complies with the provisions of paragraph (ii)
of
this Section.
(i) It
shall
not be necessary for the Seller to seek the consent of the Purchaser or any
Depositor to the utilization of any Subservicer. The Seller shall cause any
Subservicer used by the Seller (or by any Subservicer) for the benefit of the
Purchaser and any Depositor to comply with the provisions of this Section and
with Sections 13.02, 13.03(iii), (v), (vi) and (vii), 13.04, 13.05 and 13.07
of
this Agreement to the same extent as if such Subservicer were the Seller, and
to
provide the information required with respect to such Subservicer under Section
13.03(iv) of this Agreement. The Seller shall be responsible for obtaining
from
each Subservicer and delivering to the Purchaser and any Depositor any servicer
compliance statement required to be delivered by such Subservicer under Section
13.04, any assessment of compliance and attestation required to be delivered
by
such Subservicer under Section 13.05 and any certification required to be
delivered to the Person that will be responsible for signing the Sarbanes
Certification under Section 13.05 as and when required to be
delivered.
(ii) It
shall
not be necessary for the Seller to seek the consent of the Purchaser or any
Depositor to the utilization of any Subcontractor. The Seller shall promptly
upon request provide to the Purchaser, any Master Servicer and any Depositor
(or
any designee of the Depositor, such as an administrator) a written description
(in form and substance satisfactory to the Purchaser, such Master Servicer
and
such Depositor) of the role and function of each Subcontractor utilized by
the
Seller or any Subservicer, specifying (i) the identity of each such
Subcontractor, (ii) which (if any) of such Subcontractors are “participating in
the servicing function” within the meaning of Item 1122 of Regulation AB, and
(iii) which elements of the Servicing Criteria will be addressed in assessments
of compliance provided by each Subcontractor identified pursuant to clause
(ii)
of this paragraph.
As
a
condition to the utilization of any Subcontractor determined to be
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, the Seller shall cause any such Subcontractor used by the Seller
(or by any Subservicer) for the benefit of the Purchaser and any Depositor
to
comply with the provisions of Sections 13.05 and 13.07 of this Agreement to
the
same extent as if such Subcontractor were the Seller. The Seller shall be
responsible for obtaining from each Subcontractor and delivering to the
Purchaser and any Depositor any assessment of compliance and attestation
required to be delivered by such Subcontractor under Section 13.05, in each
case
as and when required to be delivered.
| Subsection 13.07. |
Indemnification;
Remedies.
|
(a) The
Seller shall indemnify the Purchaser, each affiliate of the Purchaser, any
Master Servicer and each of the following parties participating in a
Securitization Transaction: each sponsor and issuing entity; each Person
responsible for the preparation, execution or filing of any report required
to
be filed with the Commission with respect to such Securitization Transaction,
or
for execution of a certification pursuant to Rule 13a-14(d) or Rule 15d-14(d)
under the Exchange Act with respect to such Securitization Transaction; each
broker dealer acting as underwriter, placement agent or initial purchaser,
each
Person who controls any of such parties or the Depositor (within the meaning
of
Section 15 of the Securities Act and Section 20 of the Exchange Act); and the
respective present and former directors, officers, employees, agents and
affiliates of each of the foregoing and of the Depositor (each, an “Indemnified
Party”), and shall hold each of them harmless from and against any claims,
losses, damages, penalties, fines, forfeitures, legal fees and expenses and
related costs, judgments, and any other costs, fees and expenses that any of
them may sustain arising out of or based upon:
(i)(A)
any untrue statement of a material fact contained or alleged to be contained
in
any information, report, certification, data, accountants’ letter or other
material provided in written or electronic form under this Section 13 by or
on
behalf of the Seller, or provided under this Section 13 by or on behalf of
any
Subservicer, Subcontractor or Third-Party Originator (collectively, the “Seller
Information”), or (B) the omission or alleged omission to state in the Seller
Information a material fact required to be stated in the Seller Information
or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, by way
of
clarification, that clause (B) of this paragraph shall be construed solely
by
reference to the Seller Information and not to any other information
communicated in connection with a sale or purchase of securities, without regard
to whether the Seller Information or any portion thereof is presented together
with or separately from such other information;
(ii) any
breach by the Seller of its obligations under this Section 13 or any failure
by
the Seller, any Subservicer, any Subcontractor or any Third-Party Originator
to
deliver any information, report, certification, accountants’ letter or other
material when and as required under this Section 13, including any failure
by
the Seller to identify pursuant to Section 13.06(ii) any Subcontractor
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB; or
(iii) any
breach by the Seller of a representation or warranty set forth in Section
13.02(i) or in a writing furnished pursuant to Section 13.02(ii) and made as
of
a date prior to the closing date of the related Securitization Transaction,
to
the extent that such breach is not cured by such closing date, or any breach
by
the Seller of a representation or warranty in a writing furnished pursuant
to
Section 13.02(ii) to the extent made as of a date subsequent to such closing
date.
If
the
indemnification provided for herein is unavailable or insufficient to hold
harmless an Indemnified Party, then the Seller agrees that it shall contribute
to the amount paid or payable by such Indemnified Party as a result of any
claims, losses, damages or liabilities incurred by such Indemnified Party in
such proportion as is appropriate to reflect the relative fault of such
Indemnified Party on the one hand and the Seller on the other.
In
the
case of any failure of performance described in clause (a)(ii) of this Section,
the Seller shall promptly reimburse the Purchaser, any Depositor, as applicable,
and each Person responsible for the preparation, execution or filing of any
report required to be filed with the Commission with respect to such
Securitization Transaction, or for execution of a certification pursuant to
Rule
13a-14(d) or Rule 15d-14(d) under the Exchange Act with respect to such
Securitization Transaction, for all costs reasonably incurred by each such
party
in order to obtain the information, report, certification, accountants’ letter
or other material not delivered as required by the Seller, any Subservicer,
any
Subcontractor or any Third-Party Originator.
This
indemnification shall survive the termination of this Agreement or the
termination of any party to this Agreement.
(b)(i) Any
failure by the Seller, any Subservicer, any Subcontractor or any Third-Party
Originator to deliver any information, report, certification, accountants’
letter or other material when and as required under this Section 13, or any
breach by the Seller of a representation or warranty set forth in Section
13.02(i) or in a writing furnished pursuant to Section 13.02(ii) and made as
of
a date prior to the closing date of the related Securitization Transaction,
to
the extent that such breach is not cured by such closing date, or any breach
by
the Seller of a representation or warranty in a writing furnished pursuant
to
Section 13.02(ii) to the extent made as of a date subsequent to such closing
date, shall, except as provided in clause (ii) of this paragraph, immediately
and automatically, without notice or grace period, constitute an Event of
Default with respect to the Seller under this Agreement and any applicable
Reconstitution Agreement, and shall entitle the Purchaser, Master Servicer
or
Depositor, as applicable, in its sole discretion to terminate the rights and
obligations of the Seller as servicer under this Agreement and/or any applicable
Reconstitution Agreement without payment (notwithstanding anything in this
Agreement or any applicable Reconstitution Agreement to the contrary) of any
compensation to the Seller; provided
that to
the extent that any provision of this Agreement and/or any applicable
Reconstitution Agreement expressly provides for the survival of certain rights
or obligations following termination of the Seller as servicer, such provision
shall be given effect.
(ii) Any
failure by the Seller or Interim Servicer, as applicable, any Subservicer or
any
Subcontractor to deliver any information, report, certification or accountants’
letter when and as required under Section 13.04 or 13.05, including (except
as
provided below) any failure by the Seller to identify pursuant to Section
13.06(ii) any Subcontractor “participating in the servicing function” within the
meaning of Item 1122 of Regulation AB, which continues unremedied for ten
calendar days after the date on which such information, report, certification
or
accountants’ letter was required to be delivered shall constitute an Event of
Default with respect to the Seller under this Agreement and any applicable
Reconstitution Agreement, and shall entitle the Purchaser, any Master Servicer
or Depositor, as applicable, in its sole discretion to terminate the rights
and
obligations of the Seller as servicer under this Agreement and/or any applicable
Reconstitution Agreement without payment (notwithstanding anything in this
Agreement to the contrary) of any compensation to the Seller; provided that
to
the extent that any provision of this Agreement and/or any applicable
Reconstitution Agreement expressly provides for the survival of certain rights
or obligations following termination of the Seller as servicer, such provision
shall be given effect.
Neither
the Purchaser nor any Depositor shall be entitled to terminate the rights and
obligations of the Seller pursuant to this subparagraph (b)(ii) if a failure
of
the Seller to identify a Subcontractor “participating in the servicing function”
within the meaning of Item 1122 of Regulation AB was attributable solely to
the
role or functions of such Subcontractor with respect to mortgage loans other
than the Mortgage Loans.
(iii) The
Interim Servicer shall promptly reimburse the Purchaser (or any designee of
the
Purchaser, such as a master servicer) and any Depositor, as applicable, for
all
reasonable out-of-pocket expenses incurred by the Purchaser (or such designee)
or such Depositor, as such are incurred, in connection with the termination
of
the Interim Servicer as servicer and the transfer of servicing of the Mortgage
Loans to a successor servicer as provided in Subsection 13.07(b). The provisions
of this paragraph shall not limit whatever rights the Purchaser or any Depositor
may have under other provisions of this Agreement and/or any applicable
Reconstitution Agreement or otherwise, whether in equity or at law, such as
an
action for damages, specific performance or injunctive relief.
| SECTION 14. |
The
Seller.
|
| Subsection 14.01. |
Additional
Indemnification by the Seller.
|
In
addition to the indemnification provided in Subsection 7.03, the Seller
shall indemnify the Initial Purchaser and any subsequent Purchaser and hold
them
harmless against any and all third party claims, losses, damages, penalties,
fines, forfeitures, reasonable and necessary legal fees and related costs,
judgments, and any other costs, fees and expenses that the Initial Purchaser
and
any subsequent Purchaser may sustain in any way related to the failure of the
Seller to perform its obligations under this Agreement including but not limited
to its obligation to service and administer the Mortgage Loans in strict
compliance with the terms of this Agreement or any Reconstitution Agreement
entered into pursuant to Section 12.
| Subsection 14.02. |
Merger
or Consolidation of the Seller.
|
The
Seller shall keep in full force and effect its existence, rights and franchises
as a corporation under the laws of the state of its incorporation except as
permitted herein, and shall obtain and preserve its qualification to do business
as a foreign corporation in each jurisdiction in which such qualification is
or
shall be necessary to protect the validity and enforceability of this Agreement
or any of the Mortgage Loans, and to enable the Seller to perform its duties
under this Agreement.
Any
Person into which the Seller may be merged or consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Seller
shall
be a party, or any Person succeeding to the business of the Seller, shall be
the
successor of the Seller hereunder, without the execution or filing of any paper
or any further act on the part of any of the parties hereto, anything herein
to
the contrary notwithstanding; provided, however, that the successor or surviving
Person shall (i) be an institution whose deposits are insured by FDIC or a
company whose business is the origination and servicing of mortgage loans,
(ii)
have a GAAP net worth of not less than $25,000,000, and (iii) be a Xxxxxx Xxx
and Xxxxxxx
Mac
approved
seller/servicer and shall satisfy any requirements of Section 17 with
respect to the qualifications of a successor to the Seller.
| Subsection 14.03. |
Limitation
on Liability of the Seller and Others.
|
Neither
the Seller nor any of the officers, employees or agents of the Seller shall
be
under any liability to the Purchaser for any action taken or for refraining
from
the taking of any action in good faith in connection with the servicing of
the
Mortgage Loans pursuant to this Agreement, or for errors in judgment; provided,
however, that this provision shall not protect the Seller or any such person
against any breach of warranties or representations made herein, or failure
to
perform its obligations in strict compliance with any standard of care set
forth
in this Agreement, or any liability which would otherwise be imposed by reason
of any breach of the terms and conditions of this Agreement. The Seller and
any
officer, employee or agent of the Seller may rely in good faith on any document
of any kind prima facie properly executed and submitted by any Person respecting
any matters arising hereunder. The Seller shall not be under any obligation
to
appear in, prosecute or defend any legal action which is not incidental to
its
obligation to sell or duty to service the Mortgage Loans in accordance with
this
Agreement and which in its opinion may result in its incurring any expenses
or
liability; provided, however, that the Seller may, with the consent of the
Purchaser, undertake any such action which it may deem necessary or desirable
in
respect to this Agreement and the rights and duties of the parties hereto.
In
such event, the legal expenses and costs of such action and any liability
resulting therefrom shall be expenses, costs and liabilities for which the
Purchaser shall be liable, the Seller shall be entitled to reimbursement
therefor from the Purchaser upon written demand except when such expenses,
costs
and liabilities are subject to the Seller's indemnification under Subsections
7.03 or 14.01.
| Subsection 14.04. |
Seller
Not to Resign.
|
The
Seller shall not assign this Agreement or resign from the obligations and duties
hereby imposed on it except by mutual written consent of the Seller and the
Purchaser or upon the determination that its servicing duties hereunder are
no
longer permissible under applicable law and such incapacity cannot be cured
by
the Seller in which event the Seller may resign as servicer. Any such
determination permitting the resignation of the Seller as servicer shall be
evidenced by an Opinion of Counsel to such effect delivered to the Purchaser
which Opinion of Counsel shall be in form and substance acceptable to the
Purchaser and which shall be provided at the cost of the Seller. No such
resignation shall become effective until a successor shall have assumed the
Seller's responsibilities and obligations hereunder in the manner provided
in
Section 17.
| Subsection 14.05. |
No
Transfer of Servicing.
|
With
respect to the retention of the Seller to service the Mortgage Loans during
the
Interim Servicing Period, the Seller acknowledges that the Purchaser has acted
in reliance upon the Seller's independent status, the adequacy of its servicing
facilities, plan, personnel, records and procedures, its integrity, reputation
and financial standing and the continuance thereof. Without in any way limiting
the generality of this Section, the Seller shall not either assign this
Agreement or the servicing hereunder or delegate its rights or duties hereunder
or any portion thereof, or sell or otherwise dispose of all or substantially
all
of its property or assets, without the prior written approval of the Purchaser,
which consent will not be unreasonably withheld.
SECTION
15. DEFAULT.
| Subsection 15.01. |
Events
of Default.
|
In
case
one or more of the following Events of Default by the Seller shall occur and
be
continuing, that is to say:
(i) any
failure by the Seller to remit to the Purchaser any payment required to be
made
under the terms of this Agreement which continues unremedied for a period of
one
(1) Business Day after the date upon which notice of such failure, requiring
the
same to be remedied, shall have been given to the Seller by the Purchaser;
or
(ii) failure
on the part of the Seller duly to observe or perform in any material respect
any
other of the covenants or agreements on the part of the Seller set forth in
this
Agreement or in the Custodial Agreement which continues unremedied for a period
of thirty (30) days (except that such number of days shall be fifteen (15)
in
the case of a failure to pay any premium for any insurance policy required
to be
maintained under this Agreement) after the date on which written notice of
such
failure, requiring the same to be remedied, shall have been given to the Seller
by the Purchaser or by the Custodian; or
(iii) a
decree
or order of a court or agency or supervisory authority having jurisdiction
for
the appointment of a conservator or receiver or liquidator in any insolvency,
bankruptcy, readjustment of debt, marshalling of assets and liabilities or
similar proceedings, or for the winding-up or liquidation of its affairs, shall
have been entered against the Seller and such decree or order shall have
remained in force undischarged or unstayed for a period of sixty (60) days;
or
(iv) the
Seller shall consent to the appointment of a conservator or receiver or
liquidator in any insolvency, bankruptcy, readjustment of debt, marshalling
of
assets and liabilities or similar proceedings of or relating to the Seller
or of
or relating to all or substantially all of its property; or
(v) the
Seller shall admit in writing its inability to pay its debts generally as they
become due, file a petition to take advantage of any applicable insolvency
or
reorganization statute, make an assignment for the benefit of its creditors,
or
voluntarily suspend payment of its obligations; or
(vi) failure
by the Seller to be in compliance with the “doing business” or licensing laws of
any jurisdiction where a Mortgaged Property is located; or
(vii) the
Seller ceases to meet the qualifications of either a Xxxxxx Xxx or Xxxxxxx
Mac
seller/servicer, the Seller is not eligible to act as servicer or master
servicer for mortgage loans subject to residential mortgage backed securities
transactions rated by any nationally recognized rating agency or is eligible
to
act as such only with enhanced credit support, or the Seller’s credit rating is
reduced by any nationally recognized rating agency below its rating on the
Initial Closing Date; or
(viii) the
Seller attempts to assign its right to servicing compensation hereunder or
the
Seller attempts, without the written consent of the Purchaser, to sell or
otherwise dispose of all or substantially all of its property or assets or
to
assign this Agreement or the servicing responsibilities hereunder or to delegate
its duties hereunder or any portion thereof; or
(ix) [Reserved];
or
(x) the
Seller fails to duly perform, within the required time period, its obligations
under Section 13 or Sections 11.24, 11.25 or 11.26 of the Servicing Addendum,
which failure continues unremedied for a period of three (3) days after the
date
on which written notice of such failure, requiring the same to be remedied,
shall have been given to the Seller by any party to this Agreement or by any
master servicer responsible for master servicing the Mortgage Loans pursuant
to
a securitization of such Mortgage Loans;
then,
and
in each and every such case, so long as an Event of Default shall not have
been
remedied, the Purchaser, by notice in writing to the Seller may, in addition
to
whatever rights the Purchaser may have at law or equity to damages, including
injunctive relief and specific performance, terminate all the rights and
obligations of the Seller as servicer under this Agreement. On or after the
receipt by the Seller of such written notice, all authority and power of the
Seller to service the Mortgage Loans under this Agreement shall on the date
set
forth in such notice pass to and be vested in the successor appointed pursuant
to Section 17;
| Subsection 15.02. |
Waiver
of Defaults.
|
The
Purchaser may waive any default by the Seller in the performance of its
obligations hereunder and its consequences. Upon any such waiver of a past
default, such default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been remedied for every purpose of this
Agreement. No such waiver shall extend to any subsequent or other default or
impair any right consequent thereon except to the extent expressly so
waived.
SECTION
16. Termination.
The
respective
obligations and responsibilities of the Seller, as servicer, shall terminate
at
the expiration of the Interim Servicing Period unless terminated on an earlier
date at the option of the Purchaser or pursuant to Section 14. Upon written
request from the Purchaser in connection with any such termination, the Seller
shall prepare, execute and deliver, any and all documents and other instruments,
place in the Purchaser’s possession all Mortgage Files, and do or accomplish all
other acts or things necessary or appropriate to effect the purposes of such
notice of termination, whether to complete the transfer and endorsement or
assignment of the Mortgage Loans and related documents, including any transfers
on the MERS System, or otherwise, at the Seller’s sole expense. The Seller
agrees to cooperate with the Purchaser and such successor in effecting the
termination of the Seller’s responsibilities and rights hereunder as servicer,
including, without limitation, the transfer to such successor for administration
by it of all cash amounts which shall at the time be credited by the Seller
to
the Custodial Account, REO Account or Escrow Account or thereafter received
with
respect to the Mortgage Loans.
SECTION
17. Successor
to the Seller.
Prior
to termination of Seller's responsibilities and duties under this Agreement
pursuant to Section 12, 15 or 16, the Purchaser shall (i) succeed to and
assume all of the Seller's responsibilities, rights, duties and obligations
under this Agreement, or (ii) appoint a successor which shall succeed to all
rights and assume all of the responsibilities, duties and liabilities of the
Seller as servicer under this Agreement. In connection with such appointment
and
assumption, the Purchaser may make such arrangements for the compensation of
such successor out of payments on Mortgage Loans as it and such successor shall
agree. In the event that the Seller's duties, responsibilities and liabilities
as servicer under this Agreement should be terminated pursuant to the
aforementioned Sections, the Seller shall discharge such duties and
responsibilities during the period from the date it acquires knowledge of such
termination until the effective date thereof with the same degree of diligence
and prudence which it is obligated to exercise under this Agreement, and shall
take no action whatsoever that might impair or prejudice the rights or financial
condition of the Purchaser or such successor. The termination of the Seller
as
servicer pursuant to the aforementioned Sections shall not become effective
until a successor shall be appointed pursuant to this Section 17 and shall
in no event relieve the Seller of the representations and warranties made
pursuant to Subsections 7.01 and 7.02 and the remedies available to the
Purchaser under Subsection 7.03 or 7.04, it being understood and agreed
that the provisions of such Subsections 7.01, 7.02, 7.03, 7.04 and 14.01 shall
be applicable to the Seller notwithstanding any such resignation or termination
of the Seller, or the termination of this Agreement.
Any
successor appointed as provided herein shall execute, acknowledge and deliver
to
the Seller and to the Purchaser an instrument accepting such appointment,
whereupon such successor shall become fully vested with all the rights, powers,
duties, responsibilities, obligations and liabilities of the Seller, with like
effect as if originally named as a party to this Agreement and the Custodial
Agreement provided, however, that such successor shall not assume, and Seller
shall indemnify such successor for, any and all liabilities arising out of
the
Seller's acts as servicer. Any termination of the Seller as servicer pursuant
to
Section 12, 15 or 16 shall not affect any claims that the Purchaser may
have against the Seller arising prior to any such termination or resignation
or
remedies with respect to such claims.
The
Seller shall timely deliver to the successor the funds in the Custodial Account,
REO Account and the Escrow Account and the Servicing Files and Mortgage Files
and related documents and statements held by it hereunder and the Seller shall
account for all funds. The Seller shall execute and deliver such instruments
and
do such other things all as may reasonably be required to more fully and
definitely vest and confirm in the successor all such rights, powers, duties,
responsibilities, obligations and liabilities of the Seller as servicer
including making any transfers on the MERS System. The successor shall make
arrangements as it may deem appropriate to reimburse the Seller for amounts
the
Seller actually expended as servicer pursuant to this Agreement which the
successor is entitled to retain hereunder and which would otherwise have been
recovered by the Seller pursuant to this Agreement but for the appointment
of
the successor servicer.
SECTION
18. Financial
Statements.
The
Seller understands that in connection with the Purchaser's marketing of the
Mortgage Loans, the Purchaser may make available to prospective purchasers
the
Seller's financial statements for the most recently completed three (3) fiscal
years respecting which such statements are available. The Seller also shall
make
available any comparable interim statements to the extent any such statements
have been prepared by the Seller (and are available upon request to members
or
stockholders of the Seller or the public at large). The Seller, if it has not
already done so, agrees to furnish promptly to the Purchaser copies of the
statements specified above. The Seller also shall make available information
on
its servicing performance with respect to mortgage loans serviced for others,
including delinquency ratios.
The
Seller also agrees to allow access to knowledgeable financial, accounting,
origination and servicing officers of the Seller for the purpose of answering
questions asked by any prospective purchaser regarding recent developments
affecting the Seller, its loan origination or servicing practices or the
financial statements of the Seller, with two (2) Business Days prior
notice.
SECTION
19. Mandatory
Delivery: Grant of Security Interest.
The
sale and delivery of each Mortgage Loan on or before the related Closing Date
is
mandatory from and after the date of the execution of the related Confirmation,
it being specifically understood and agreed that each Mortgage Loan is unique
and identifiable on the date hereof and that an award of money damages would
be
insufficient to compensate the Initial Purchaser for the losses and damages
incurred by the Initial Purchaser (including damages to prospective purchasers
of the Mortgage Loans) in the event of the Seller's failure to deliver each
of
the related Mortgage Loans or one or more Mortgage Loans otherwise acceptable
to
the Initial Purchaser on or before the related Closing Date. The Seller hereby
grants to the Initial Purchaser a lien on and a continuing security interest
in
each Mortgage Loan and each document and instrument evidencing each such
Mortgage Loan to secure the performance by the Seller of its obligation
hereunder, and the Seller agrees that it holds such Mortgage Loans in custody
for the Initial Purchaser subject to the Initial Purchaser's (i) right to reject
any Mortgage Loan under the terms of this Agreement and the related
Confirmation, and (ii) obligation to pay the related Purchase Price for the
Mortgage Loans. All rights and remedies of the Purchaser under this Agreement
are distinct from, and cumulative with, any other rights or remedies under
this
Agreement or afforded by law or equity and all such rights and remedies may
be
exercised concurrently, independently or successively.
SECTION
20. Notices.
All
demands, notices and communications hereunder shall be in writing and shall
be
deemed to have been duly given if mailed, by registered or certified mail,
return receipt requested, or, if by other means, when received by the other
party at the address as follows:
(i) if
to the
Purchaser:
Citigroup
Global Markets Realty Corp.
000
Xxxxxxxxx Xxxxxx, 0xx
Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxx Xxxxxxxxx
With
copies to:
Citigroup
Global Markets Realty Corp.
000
Xxxxxxxxx Xxxxxx, 0xx
Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Legal
(ii) if
to the
Seller:
New
Century Mortgage Corporation
00000
Xxx
Xxxxxx, Xxxxx 0000
Xxxxxx,
Xxxxxxxxxx 00000
Attn:
Xxxxxx
Xxxxxx
With
copies to:
New
Century Mortgage Corporation
00000
Xxx
Xxxxxx, Xxxxx 0000
Xxxxxx,
Xxxxxxxxxx 00000
Attn:
General
Counsel
or
such
other address as may hereafter be furnished to the other party by like notice.
Any such demand, notice or communication hereunder shall be deemed to have
been
received on the date delivered to or received at the premises of the addressee
(as evidenced, in the case of registered or certified mail, by the date noted
on
the return receipt).
SECTION
21. Severability
Clause.
Any
part, provision, representation or warranty of this Agreement which is
prohibited or which is held to be void or unenforceable shall be ineffective
to
the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof. Any part, provision, representation or warranty
of
this Agreement which is prohibited or unenforceable or is held to be void or
unenforceable in any jurisdiction shall be ineffective, as to such jurisdiction,
to the extent of such prohibition or unenforceability without invalidating
the
remaining provisions hereof, and any such prohibition or unenforceability in
any
jurisdiction as to any Mortgage Loan shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by applicable law, the parties hereto waive any provision of law which prohibits
or renders void or unenforceable any provision hereof. If the invalidity of
any
part, provision, representation or warranty of this Agreement shall deprive
any
party of the economic benefit intended to be conferred by this Agreement, the
parties shall 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.
SECTION
22. Counterparts.
This
Agreement may be executed simultaneously in any number of counterparts. Each
counterpart shall be deemed to be an original, and all such counterparts shall
constitute one and the same instrument.
SECTION
23. GOVERNING
LAW; SUBMISSION TO JURISDICTION.
THE
AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO ANY CONFLICTS OF LAW PROVISIONS (EXCEPT FOR SECTIONS
5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW) AND THE OBLIGATIONS,
RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK, EXCEPT TO THE EXTENT PREEMPTED BY
FEDERAL LAW.
EACH
PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY:
(A)
SUBMITS
FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT, OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT
THEREOF, TO THE NON-EXCLUSIVE GENERAL JURISDICTION OF THE COURTS OF THE STATE
OF
NEW YORK, THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND APPELLATE COURTS FROM ANY THEREOF;
(B)
CONSENTS
THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN SUCH COURTS AND, TO THE
EXTENT PERMITTED BY LAW, WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER
HAVE
TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH
ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT TO
PLEAD OR CLAIM THE SAME;
(C)
AGREES
THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR PROCEEDING MAY BE EFFECTED BY
MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY
SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO ITS ADDRESS SET FORTH IN SECTION
20;
AND
(D)
AGREES
THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN
ANY
OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO XXX IN ANY OTHER
JURISDICTION.
SECTION
24. Intention
of the Parties.
It is
the intention of the parties that the Initial Purchaser is purchasing, and
the
Seller is selling, the Mortgage Loans and not a debt instrument of the Seller
or
another security. Accordingly, the parties hereto each intend to treat the
transaction for Federal income tax purposes as a sale by the Seller, and a
purchase by the Purchaser, of the Mortgage Loans. The Initial Purchaser shall
have the right to review the Mortgage Loans and the related Mortgage Loan Files
to determine the characteristics of the Mortgage Loans which shall affect the
Federal income tax consequences of owning the Mortgage Loans and the Seller
shall cooperate with all reasonable requests made by the Initial Purchaser
in
the course of such review.
SECTION
25. Successors
and Assigns.
This
Agreement shall bind and inure to the benefit of and be enforceable by the
Seller and the Purchaser and the respective successors and assigns of the Seller
and the Purchaser. The Purchaser may assign this Agreement to any Person to
whom
any Mortgage Loan is transferred whether pursuant to a sale or financing and
to
any Person to whom the servicing or master servicing of any Mortgage Loan is
sold or transferred. Upon any such assignment, the Person to whom such
assignment is made shall succeed to all rights and obligations of the Purchaser
under this Agreement to the extent of the related Mortgage Loan or Mortgage
Loans and this Agreement, to the extent of the related Mortgage Loan or Loans,
shall be deemed to be a separate and distinct Agreement between the Seller
and
such Purchaser, and a separate and distinct Agreement between the Seller and
each other Purchaser to the extent of the other related Mortgage Loan or Loans.
In the event that this Agreement is assigned to any Person to whom the servicing
or master servicing of any Mortgage Loan is sold or transferred, the rights
and
benefits under this agreement which inure to the Purchaser shall inure to the
benefit of both the Person to whom such Mortgage Loan is transferred and the
Person to whom the servicing or master servicing of the Mortgage Loan has been
transferred; provided that, the right to require a Mortgage Loan to be
repurchased by the Seller pursuant to Subsection 7.03 or 7.04 shall be
retained solely by the Purchaser. This Agreement shall not be assigned, pledged
or hypothecated by the Seller to a third party without the consent of the
Purchaser.
SECTION
26. Waivers.
No term
or provision of this Agreement may be waived or modified unless such waiver
or
modification is in writing and signed by the party against whom such waiver
or
modification is sought to be enforced.
SECTION
27. Exhibits.
The
exhibits to this Agreement are hereby incorporated and made a part hereof and
are an integral part of this Agreement.
SECTION
28. Nonsolicitation.
The
Seller agrees that it will not take any action or permit or cause any action
to
be taken by any of its agents or affiliates, to personally, by telephone, mail
e-mail or otherwise, solicit the Mortgagor under any Mortgage Loan to refinance
the Mortgage Loan, in whole or in part or provide information to any other
entity to solicit the refinancing of any Mortgage Loan in whole or in part;
provided that, the foregoing shall not preclude the Seller from engaging in
solicitations to the general public by newspaper, radio, television or other
media which are not directed toward the Mortgagors or from refinancing the
Mortgage Loan of any Mortgagor who, without solicitation, contacts the Seller
to
request the refinancing of the related Mortgage Loan or from refinancing the
Mortgage Loan of any Mortgagor who submits a payoff or verification of mortgage
request during the Interim Servicing Period.
It is
further understood and agreed that the Seller is permitted to solicit the
borrower or obligor to refinance a Mortgage Loan in the event that you receive
a
payoff demand or verification of mortgage, or to refinance a Mortgage Loan
of
any borrower or obligor who, without solicitation, contacts the Seller to
request the refinancing of the Mortgage Loan.
SECTION
29. General
Interpretive Principles.
For
purposes of this Agreement, except as otherwise expressly provided or unless
the
context otherwise requires:
| (a) |
the
terms defined in this Agreement have the meanings assigned to them
in this
Agreement and include the plural as well as the singular, and the use
of
any gender herein shall be deemed to include the other
gender;
|
| (b) |
accounting
terms not otherwise defined herein have the meanings assigned to them
in
accordance with generally accepted accounting
principles;
|
| (c) |
references
herein to “Articles,” “Sections,” “Subsections,” “Paragraphs,” and other
Subdivisions without reference to a document are to designated Articles,
Sections, Subsections, Paragraphs and other subdivisions of this
Agreement;
|
| (d) |
reference
to a Subsection without further reference to a Section is a reference
to
such Subsection as contained in the same Section in which the reference
appears, and this rule shall also apply to Paragraphs and other
subdivisions;
|
| (e) |
the
words “herein,” “hereof,” “hereunder” and other words of similar import
refer to this Agreement as a whole and not to any particular provision;
and
|
| (f) |
the
term “include” or “including” shall mean without limitation by reason of
enumeration.
|
SECTION
30. Reproduction
of Documents.
This
Agreement and all documents relating thereto, including, without limitation,
(a)
consents, waivers and modifications which may hereafter be executed, (b)
documents received by any party at the closing, and (c) financial statements,
certificates and other information previously or hereafter furnished, may be
reproduced by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties agree that any such
reproduction shall 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 shall likewise be admissible in
evidence.
SECTION
31. Third
Party Beneficiary.
Each
Master Servicer shall be considered a third-party beneficiary of this Agreement,
entitled to all the rights and benefits hereunder as if it were a direct party
to this Agreement.
SECTION
32. Further
Agreements.
The
Seller and the Purchaser each agree to execute and deliver to the other such
reasonable and appropriate additional documents, instruments or agreements
as
may be necessary or appropriate to effectuate the purposes of this
Agreement.
SECTION
33. Entire
Agreement.
This
Agreement constitutes the entire agreement and understanding of the parties
with
respect to the matters and transactions contemplated by this Agreement and,
except to the extent otherwise set forth in writing, supersedes any prior
agreement and understandings with respect to those matters and
transactions.
IN
WITNESS WHEREOF, the Seller and the Purchaser have caused their names to be
signed hereto by their respective officers thereunto duly authorized as of
the
date first above written.
|
NC
CAPITAL CORPORATION
(Seller)
By:______________________________________
Name:
Title:
NEW
CENTURY MORTGAGE CORPORATION
(Interim
Servicer)
By:______________________________________
Name:
Title:
|
|
|
CITIGROUP
GLOBAL MARKETS REALTY CORP.
(Initial
Purchaser)
By:______________________________________
Name:
Title:
|
EXHIBIT
1
SELLER'S
OFFICER'S CERTIFICATE
I,
________________________, hereby certify that I am the duly elected
______________ of New Century Mortgage Corporation, a ______________ (the
“Seller”), and further certify, on behalf of the Seller as follows:
1. Attached
hereto as Attachment I are a true and correct copy of the Certificate of
Incorporation and by-laws of the Seller as are in full force and effect on
the
date hereof.
2. No
proceedings looking toward merger, liquidation, dissolution or bankruptcy of
the
Seller are pending or contemplated.
3. Each
person who, as an officer or attorney-in-fact of the Seller, signed (a) the
Master Mortgage Loan Purchase and Interim Servicing Agreement (the “Purchase
Agreement”), dated as of March 1, 2006, by
and
between the Seller and Citigroup Global Markets Realty Corp. (the
“Purchaser”);
(b) the
Confirmation, dated _____________ 200_, between the Seller and the Purchaser
(the “Confirmation”); (c) the Custodial Agreement, dated as of March 1, 2006,
among the Purchaser, the Seller and Deutsche Bank Trust Company Americas (the
“Custodial Agreement”); and (d) any other document delivered prior hereto or on
the date hereof in connection with the sale and servicing of the Mortgage Loans
in accordance with the Purchase Agreement and the Confirmation was, at the
respective times of such signing and delivery, and is as of the date hereof,
duly elected or appointed, qualified and acting as such officer or
attorney-in-fact, and the signatures of such persons appearing on such documents
are their genuine signatures.
4. Attached
hereto as Attachment II is a true and correct copy of the resolutions duly
adopted by the board of directors of the Seller on ________________, 200_ (the
“Resolutions”) with respect to the authorization and approval of the sale and
servicing of the Mortgage Loans; said Resolutions have not been amended,
modified, annulled or revoked and are in full force and effect on the date
hereof.
5. Attached
hereto as Attachment III is a Certificate of Good Standing of the Seller dated
______________, 200_. No event has occurred since ___________________, 200_
which has affected the good standing of the Seller under the laws of the State
of ___________.
6. All
of
the representations and warranties of the Seller contained in Subsections 7.01
and 7.02 of the Purchase Agreement were true and correct in all material
respects as of the date of the Purchase Agreement and are true and correct
in
all material respects as of the date hereof.
7. The
Seller has performed all of its duties and has satisfied all the material
conditions on its part to be performed or satisfied prior to the related Closing
Date pursuant to the Purchase Agreement and the related
Confirmation.
All
capitalized terms used herein and not otherwise defined shall have the meaning
assigned to them in the Purchase Agreement.
IN
WITNESS WHEREOF, I have hereunto signed my name and affixed the seal of the
Seller.
Dated:
_________________________
[Seal]
|
NC
CAPITAL CORPORATION
(Seller)
By:____________________________________
Name:__________________________________
Title:
Vice President
|
I,
_______________________, Secretary of the Seller, hereby certify that
_________________________ is the duly elected, qualified and acting Vice
President of the Seller and that the signature appearing above is his genuine
signature.
IN
WITNESS WHEREOF, I have hereunto signed my name.
Dated:_________________________
[Seal]
|
NC
CAPITAL CORPORATION
(Seller)
By:____________________________________
Name:__________________________________
Title:
[Assistant] Secretary
|
EXHIBIT
2
[FORM
OF
OPINION OF COUNSEL TO THE SELLER]
______________________________
(Date)
Citigroup
Global Markets Realty Corp.
000
Xxxxxxxxx Xxxxxx, 0xx
Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
|
Re:
|
Master
Mortgage Loan Purchase and Interim Servicing Agreement, dated as
of Xxxxx
0, 0000
|
Xxxxxxxxx:
I
have
acted as counsel to New Century Mortgage Corporation, a _________________ (the
“Seller”), in connection with the sale of certain mortgage loans by the Seller
to Citigroup Global Markets Realty Corp. (the “Purchaser”) pursuant to (i) a
Master Mortgage Loan Purchase and Interim Servicing Agreement, dated as of
March
1, 2006, between the Seller and the Purchaser (the “Purchase Agreement”), the
Custodial Agreement, dated as of March 1, 2006, among the Seller, the Purchaser,
and Deutsche Bank Trust Company Americas (the “Custodial Agreement”) [and the
Confirmation, dated __________, 200_, between the Seller and the Purchaser
(the
“Confirmation”)]. Capitalized terms not otherwise defined herein have the
meanings set forth in the Purchase Agreement.
In
connection with rendering this opinion letter, I, or attorneys working under
my
direction, have examined, among other things, originals, certified copies or
copies otherwise identified to my satisfaction as being true copies of the
following:
|
A.
|
The
Purchase Agreement;
|
|
B.
|
[The
Confirmation;]
|
|
C.
|
The
Custodial Agreement;
|
|
D.
|
The
Seller's Certificate of Incorporation and by-laws, as amended to
date;
and
|
|
E.
|
Resolutions
adopted by the Board of Directors of the Seller with specific reference
to
actions relating to the transactions covered by this opinion (the
“Board
Resolutions”).
|
For
the
purpose of rendering this opinion, I have made such documentary, factual and
legal examinations as I deemed necessary under the circumstances. As to factual
matters, I have relied upon statements, certificates and other assurances of
public officials and of officers and other representatives of the Seller, and
upon such other certificates as I deemed appropriate, which factual matters
have
not been independently established or verified by me. I have also assumed,
among
other things, the genuineness of all signatures, the legal capacity of all
natural persons, the authenticity of all documents submitted to me as originals,
and the conformity to original documents of all documents submitted to me as
copies and the authenticity of the originals of such copied
documents.
On
the
basis of and subject to the foregoing examination, and in reliance thereon,
and
subject to the assumptions, qualifications, exceptions and limitations expressed
herein, I am of the opinion that:
1. The
Seller has been duly incorporated and is validly existing and in good standing
under the laws of the State of __________ with corporate power and authority
to
own its properties and conduct its business as presently conducted by it. The
Seller has the corporate power and authority to service the Mortgage Loans,
and
to execute, deliver, and perform its obligations under the Purchase Agreement,
the Custodial Agreement [and the Confirmation] (sometimes collectively, the
“Agreements”).
2. The
Purchase Agreement, the Custodial Agreement [and the Confirmation] have been
duly and validly authorized, executed and delivered by the Seller.
3. The
Purchase Agreement, the Custodial Agreement [and the Confirmation] constitute
valid, legal and binding obligations of the Seller, enforceable against the
Seller in accordance with their respective terms.
4. No
consent, approval, authorization or order of any state or federal court or
government agency or body is required for the execution, delivery and
performance by the Seller of the Purchase Agreement, the Custodial Agreement
[and the Confirmation], or the consummation of the transactions contemplated
by
the Purchase Agreement, the Custodial Agreement [and the Confirmation], except
for those consents, approvals, authorizations or orders which previously have
been obtained.
5. Neither
the servicing of the Mortgage Loans by the Seller as provided in the Purchase
Agreement [and the Confirmation,] nor the fulfillment of the terms of or the
consummation of any other transactions contemplated in the Purchase Agreement,
the Custodial Agreement [and the Confirmation] will result in a breach of any
term or provision of the [certificate of incorporation or by-laws][certificate
of limited partnership or limited partnership agreement] of the Seller, or,
to
the best of my knowledge, will conflict with, result in a breach or violation
of, or constitute a default under, (i) the terms of any indenture or other
agreement or instrument known to me to which the Seller is a party or by which
it is bound, (ii) any State of ____________ or federal statute or regulation
applicable to the Seller, or (iii) any order of any State of ____________ or
federal court, regulatory body, administrative agency or governmental body
having jurisdiction over the Seller, except in any such case where the default,
breach or violation would not have a material adverse effect on the Seller
or
its ability to perform its obligations under the Purchase Agreement and the
Custodial Agreement.
6. There
is
no action, suit, proceeding or investigation pending or, to the best of my
knowledge, threatened against the Seller which, in my judgment, either in any
one instance or in the aggregate, would draw into question the validity of
the
Purchase Agreement or the Custodial Agreement or which would be likely to impair
materially the ability of the Seller to perform under the terms of the Purchase
Agreement or the Custodial Agreement.
7. The
sale
of each Mortgage Note and Mortgage as and in the manner contemplated by the
Purchase Agreement is sufficient fully to transfer to the Purchaser all right,
title and interest of the Seller thereto as noteholder and
mortgagee.
The
opinions above are subject to the following additional assumptions, exceptions,
qualifications and limitations:
A. I
have
assumed that all parties to the Agreements other than the Seller have all
requisite power and authority to execute, deliver and perform their respective
obligations under each of the Agreements, and that the Agreements have been
duly
authorized by all necessary corporate action on the part of such parties, have
been executed and delivered by such parties and constitute the legal, valid
and
binding obligations of such parties.
B. My
opinion expressed in paragraphs 3 and 7 above is subject to the qualifications
that (i) the enforceability of the Agreements may be limited by the effect
of
laws relating to (1) bankruptcy, reorganization, insolvency, moratorium or
other
similar laws now or hereafter in effect relating to creditors' rights generally,
including, without limitation, the effect of statutory or other laws regarding
fraudulent conveyances or preferential transfers, and (2) general principles
of
equity upon the specific enforceability of any of the remedies, covenants or
other provisions of the Agreements and upon the availability of injunctive
relief or other equitable remedies and the application of principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) as such principles relate to, limit or affect the enforcement
of creditors' rights generally and the discretion of the court before which
any
proceeding for such enforcement may be brought; and (ii) I express no opinion
herein with respect to the validity, legality, binding effect or enforceability
of (a) provisions for indemnification in the Agreements to the extent such
provisions may be held to be unenforceable as contrary to public policy or
(b)
Section 19 of the Purchase Agreement.
C. I
have
assumed, without independent check or certification, that there are no
agreements or understandings among the Seller, the Purchaser and any other
party
which would expand, modify or otherwise affect the terms of the documents
described herein or the respective rights or obligations of the parties
thereunder.
I
am
admitted to practice in the State of ___________, and I render no opinion herein
as to matters involving the laws of any jurisdiction other than the State of
_________ and the Federal laws of the United States of America.
Very
truly yours,
EXHIBIT
3
SECURITY
RELEASE CERTIFICATION
I. Release
of Security Interest
___________________________,
hereby relinquishes any and all right, title and interest it may have in and
to
the Mortgage Loans described in Exhibit A attached hereto upon purchase thereof
by Citigroup Global Markets Realty Corp. from the Seller named below pursuant
to
that certain Master Mortgage Loan Purchase and Interim Servicing Agreement,
dated as of March 1, 2006, as of the date and time of receipt by
______________________________ of $__________ for such Mortgage Loans (the
“Date
and Time of Sale”), and certifies that all notes, mortgages, assignments and
other documents in its possession relating to such Mortgage Loans have been
delivered and released to the Seller named below or its designees as of the
Date
and Time of Sale.
|
Name
and Address of Financial Institution
|
|
(Name)
(Address)
|
|
By:______________________________________
|
II. Certification
of Release
The
Seller named below hereby certifies to Citigroup Global Markets Realty Corp.
that, as of the Date and Time of Sale of the above mentioned Mortgage Loans
to
Citigroup Global Markets Realty Corp., the security interests in the Mortgage
Loans released by the above named corporation comprise all security interests
relating to or affecting any and all such Mortgage Loans. The Seller warrants
that, as of such time, there are and will be no other security interests
affecting any or all of such Mortgage Loans.
|
Seller
By:___________________________________
Name:_________________________________
Title:__________________________________
|
EXHIBIT
4
ASSIGNMENT
AND CONVEYANCE
On
this
_______ day of ________, 200_, NEW CENTURY MORTGAGE CORPORATION (“Seller”) as
the Seller under that certain Master Mortgage Loan Purchase and Interim
Servicing Agreement, dated as of March 1, 2006 (the “Agreement”) does hereby
sell, transfer, assign, set over and convey to Citigroup Global Markets Realty
Corp. as Purchaser under the Agreement, without recourse, but subject to the
terms of the Agreement, all rights, title and interest of the Seller in and
to
the Mortgage Loans listed on the Mortgage Loan Schedule attached hereto,
together with the related servicing rights thereto, the Mortgage Files and
all
rights and obligations arising under the documents contained therein including
the right to any Prepayment Charges payable with respect thereto. Pursuant
to
Subsection 6.03 of the Agreement, the Seller has delivered to the Custodian
the
documents for each Mortgage Loan to be purchased as set forth in the Custodial
Agreement. The contents of each related Servicing File required to be retained
by the Seller to service the Mortgage Loans pursuant to the Agreement and thus
not delivered to the Purchaser are and shall be held in trust by the Seller
for
the benefit of the Purchaser as the owner thereof. The Seller's possession
of
any portion of each such Servicing File is at the will of the Purchaser for
the
sole purpose of facilitating servicing of the related Mortgage Loan pursuant
to
the Agreement, and such retention and possession by the Seller shall be in
a
custodial capacity only. The ownership of each Mortgage Note, Mortgage, and
the
contents of the Mortgage File and Servicing File is vested in the Purchaser
and
the ownership of all records and documents with respect to the related Mortgage
Loan prepared by or which come into the possession of the Seller shall
immediately vest in the Purchaser and shall be retained and maintained, in
trust, by the Seller at the will of the Purchaser in such custodial capacity
only.
The
Seller confirms to the Purchaser that the representation and warranties set
forth in Subsections 7.01 and 7.02 of the Agreement are true and correct with
respect to the Seller and the Mortgage Loans listed on the Mortgage Loan
Schedule attached hereto as of the date hereof, and that all statements made
in
the Seller’s Officer’s Certificates and all Attachments thereto remain complete,
true and correct in all respects as of the date hereof, and that the Mortgage
Loan characteristics identified on the attached Schedule are true and correct
as
of the date hereof.
Capitalized
terms used herein and not otherwise defined shall have the meanings set forth
in
the Agreement.
|
NC
CAPITAL CORPORATION
Seller
By:___________________________________
Name:_________________________________
Title:__________________________________
|
EXHIBIT
5
CONTENTS
OF EACH MORTGAGE FILE
With
respect to each Mortgage Loan, the Mortgage File shall include each of the
following items, which shall be available for inspection by the Purchaser and
which shall be retained by the Seller or delivered to the
Custodian:
| 1. |
Copies
of the Mortgage Loan Documents.
|
| 2. |
Residential
loan application.
|
| 3. |
Mortgage
Loan closing statement.
|
| 4. |
Verification
of employment and income, if applicable.
|
| 5. |
Verification
of acceptable evidence of source and amount of downpayment, if
applicable.
|
| 6. |
Credit
report on Mortgagor.
|
| 7. |
Residential
appraisal report.
|
| 8. |
Photograph
of the Mortgaged Property.
|
| 9. |
Copy
of the Survey of the Mortgaged Property.
|
| 10. |
Copy
of each instrument necessary to complete identification of any exception
set forth in the exception schedule in the title policy, i.e., map
or
plat, restrictions, easements, sewer agreements, home association
declarations, etc.
|
| 11. |
All
required disclosure statements and statement of Mortgagor confirming
receipt thereof.
|
| 12. |
If
available, termite report, structural engineer's report, water potability
and septic certification.
|
| 13. |
Sales
Contract, if applicable.
|
| 14. |
Hazard
insurance policy.
|
| 15. |
Flood
Insurance policy, if applicable.
|
| 16. |
Tax
Service Contract, if applicable.
|
| 17. |
Flood
Service Contract, if applicable.
|
| 18. |
Tax
receipts, insurance premium receipts, ledger sheets, payment history
from
date of origination, insurance claim files, correspondence, current
and
historical computerized data files, and all other processing, underwriting
and closing papers and records which are customarily contained in a
mortgage loan file and which are required to document the Mortgage
Loan or
to service the Mortgage Loan.
|
| 19. |
Amortization
schedule, if available.
|
| 20. |
Payment
history for Mortgage Loans that have been closed for more than 90
days.
|
EXHIBIT
6
MORTGAGE
LOAN DOCUMENTS
|
(a)
|
the
original Mortgage Note bearing all intervening endorsements necessary
to
show a complete chain of endorsements from the original payee to
the
Seller, endorsed in blank, "Pay to the order of _____________, without
recourse", and, if previously endorsed, signed in the name of the
last
endorsee by a duly qualified officer of the last endorsee. If the
Mortgage
Loan was acquired by the last endorsee in a merger, the endorsement
shall
be by "[name of last endorsee], successor by merger to [name of
predecessor]". If the Mortgage Loan was acquired or originated by
the last
endorsee while doing business under another name, the endorsement
shall be
by "[name of last endorsee], formerly known as [previous
name]";
|
| (b) |
with
respect to each Mortgage Loan which is not a MERS Mortgage Loan, the
original Assignment of Mortgage for each Mortgage Loan, in form and
substance acceptable for recording. The Mortgage shall be assigned,
with
assignee's name left blank. If the Mortgage Loan was acquired by the
last
assignee in a merger, the Assignment of Mortgage shall be made by "[name
of last assignee], successor by merger to [name of predecessor]". If
the
Mortgage Loan was acquired or originated by the last assignee while
doing
business under another name, the Assignment of Mortgage shall be by
"[name
of last assignee], formerly known as [previous
name];
|
| (c) |
the
original of each guarantee executed in connection with the Mortgage
Note,
if any;
|
| (d) |
the
original recorded Mortgage with evidence of recording thereon. If in
connection with any Mortgage Loan, the Seller has not delivered or
caused
to be delivered the original Mortgage with evidence of recording thereon
on or prior to the related Closing Date because of a delay caused by
the
public recording office where such Mortgage has been delivered for
recordation or because such Mortgage has been lost or because such
public
recording office retains the original recorded Mortgage, the Seller
shall
deliver or cause to be delivered to the Custodian, (i) in the case
of a
delay caused by the public recording office, a copy of such Mortgage
certified by the Seller, escrow agent, title insurer or closing attorney
to be a true and complete copy of the original recorded Mortgage and
(ii)
in the case where a public recording office retains the original recorded
Mortgage or in the case where a Mortgage is lost after recordation
in a
public recording office, a copy of such Mortgage certified by such
public
recording office to be a true and complete copy of the original recorded
Mortgage;
|
| (e) |
originals
of each assumption, modification, consolidation or extension agreement,
if
any. If in connection with any Mortgage Loan, the Seller has not delivered
or caused to be delivered the originals of each assumption, modification,
consolidation or extension agreement on or prior to the related Closing
Date because of a delay caused by the public recording office where
such
assumption, modification, consolidation or extension agreement has
been
delivered for recordation or because such assumption, modification,
consolidation or extension agreement has been lost, the Seller shall
deliver or cause to be delivered to the Custodian, (i) in the case
of a
delay caused by the public recording office, a copy of such assumption,
modification, consolidation or extension agreement certified by the
Seller, escrow agent, title insurer or closing attorney to be a true
and
complete copy of the original assumption, modification, consolidation
or
extension agreement and (ii) in the case where a public recording office
retains the original recorded assumption, modification, consolidation
or
extension agreement or in the case where a Mortgage is lost after
recordation in a public recording office, a copy of such assumption,
modification, consolidation or extension agreement certified by such
public recording office to be a true and complete copy of the original
recorded assumption, modification, consolidation or extension
agreement.
|
| (f) |
except
in the event that the original Mortgage is made to MERS, the originals
of
all intervening assignments of mortgage with evidence of recording
thereon
evidencing a complete chain of ownership from the originator of the
Mortgage Loan to the last assignee (or to MERS, if the Mortgage Loan
is
registered on the MERS System), or if any such intervening assignment
of
mortgage has not been returned from the applicable public recording
office
or has been lost or if such public recording office retains the original
recorded intervening assignments of mortgage, a photocopy of such
intervening assignment of mortgage, together with (i) in the case of
a
delay caused by the public recording office, an Officer's Certificate
of
the Seller, escrow agent, closing attorney or the title insurer insuring
the Mortgage stating that such intervening assignment of mortgage has
been
delivered to the appropriate public recording office for recordation
and
that such original recorded intervening assignment of mortgage or a
copy
of such intervening assignment of mortgage certified by the appropriate
public recording office to be a true and complete copy of the original
recorded intervening assignment of mortgage will be promptly delivered
to
the Custodian upon receipt thereof by the party delivering the Officer's
Certificate or by the Seller; or (ii) in the case of an intervening
assignment of mortgage where a public recording office retains the
original recorded intervening assignment of mortgage or in the case
where
an intervening assignment of mortgage is lost after recordation in
a
public recording office, a copy of such intervening assignment of mortgage
with recording information thereon certified by such public recording
office to be a true and complete copy of the original recorded intervening
assignment of mortgage;
|
| (g) |
if
the Mortgage Note, the Mortgage, any Assignment of Mortgage or any
other
related document has been signed by a Person on behalf of the Mortgagor,
the original power of attorney or other instrument that authorized
and
empowered such Person to sign;
|
| (h) |
the
original lender's title insurance policy (or a marked title insurance
commitment, in the event that an original lender’s title insurance policy
has not yet been issued) in the form of an ALTA mortgage title insurance
policy, containing each of the endorsements required by Xxxxxx Xxx
and
insuring the Purchaser and its successors and assigns as to the first
or
secured priority lien of the Mortgage in the original principal amount
of
the Mortgage Loan; and
|
| (i) |
the
original of any security agreement, chattel mortgage or equivalent
document executed in connection with the Mortgage, if
any.
|
EXHIBIT
7
CUSTODIAL
ACCOUNT LETTER AGREEMENT
____________
__, 200_
To:
__________________________________
(the
“Depository”)
As
Seller
under the Master Mortgage Loan Purchase and Interim Servicing Agreement, dated
as of March 1, 2006, we hereby authorize and request you to establish an
account, as a Custodial Account, to be designated as “New Century Mortgage
Corporation in trust for the Purchaser and various Mortgagors, Fixed and
Adjustable Rate Mortgage Loans.” All deposits in the account shall be subject to
withdrawal therefrom by order signed by the Seller. You may refuse any deposit
which would result in violation of the requirement that the account be fully
insured as described below. This letter is submitted to you in duplicate. Please
execute and return one original to us.
|
NC
CAPITAL CORPORATION
(Seller)
By:___________________________________
Name:_________________________________
Title:__________________________________
Date:__________________________________
|
The
undersigned, as Depository, hereby certifies that the above-described account
has been established under Account Number ___________ at the office of the
Depository indicated above, and agrees to honor withdrawals on such account
as
provided above. The full amount deposited at any time in the account will be
insured by the Federal Deposit Insurance Corporation through the Bank Insurance
Fund (“BIF”) or the Savings Association Insurance Fund (“SAIF”).
|
(Depository)
By:___________________________________
Name:_________________________________
Title:__________________________________
Date:__________________________________
|
EXHIBIT
8
ESCROW
ACCOUNT LETTER AGREEMENT
____________
__, 200_
To:
__________________________________
(the
“Depository”)
As
Seller
under the Master Mortgage Loan Purchase and Interim Servicing Agreement, dated
as of March 1, 2006, we hereby authorize and request you to establish an
account, as an Escrow Account, to be designated as “New Century Mortgage
Corporation in trust for the Purchaser and various Mortgagors, Fixed and
Adjustable Rate Mortgage Loans.” All deposits in the account shall be subject to
withdrawal therefrom by order signed by the Seller. You may refuse any deposit
which would result in violation of the requirement that the account be fully
insured as described below. This letter is submitted to you in duplicate. Please
execute and return one original to us.
|
NC
CAPITAL CORPORATION
(Seller)
By:___________________________________
Name:_________________________________
Title:__________________________________
Date:__________________________________
|
The
undersigned, as Depository, hereby certifies that the above-described account
has been established under Account Number ___________ at the office of the
Depository indicated above, and agrees to honor withdrawals on such account
as
provided above. The full amount deposited at any time in the account will be
insured by the Federal Deposit Insurance Corporation through the Bank Insurance
Fund (“BIF”) or the Savings Association Insurance Fund (“SAIF”).
|
(Depository)
By:___________________________________
Name:_________________________________
Title:__________________________________
Date:__________________________________
|
EXHIBIT
9
SERVICING
ADDENDUM
Subsection
11.01 Interim
Servicer to Act as Interim Servicer.
The
Interim Servicer, as independent contract servicer, shall service and administer
the Mortgage Loans in accordance with Accepted Servicing Practices and this
Agreement during the Interim Servicing Period and shall have full power and
authority, acting alone, to do or cause to be done any and all things in
connection with such servicing and administration which the Interim Servicer
may
deem necessary or desirable and consistent with the terms of this
Agreement.
Consistent
with the terms of this Agreement, the Interim Servicer may waive, modify or
vary
any term of any Mortgage Loan or consent to the postponement of strict
compliance with any such term or in any manner grant indulgence to any Mortgagor
if in the Interim Servicer's reasonable and prudent determination such waiver,
modification, postponement or indulgence is not materially adverse to the
Purchaser; provided, however, that the Interim Servicer shall not permit any
modification with respect to any Mortgage Loan that would change the Mortgage
Interest Rate, defer or forgive the payment thereof or of any principal or
interest payments, reduce the outstanding principal amount (except for actual
payments of principal), make additional advances of additional principal or
extend the final maturity date on such Mortgage Loan. Without limiting the
generality of the foregoing, the Interim Servicer shall continue, and is hereby
authorized and empowered, to execute and deliver on behalf of itself, and the
Purchaser, all instruments of satisfaction or cancellation, or of partial or
full release, discharge and all other comparable instruments, with respect
to
the Mortgage Loans and with respect to the Mortgaged Property. If reasonably
required by the Interim Servicer, the Purchaser shall furnish the Interim
Servicer with any powers of attorney and other documents necessary or
appropriate to enable the Interim Servicer to carry out its servicing and
administrative duties under this Agreement.
In
servicing and administering the Mortgage Loans, the Interim Servicer shall
employ procedures including collection procedures and exercise the same care
that it customarily employs and exercises in servicing and administering
mortgage loans for its own account giving due consideration to accepted mortgage
servicing practices of prudent lending institutions and the Purchaser's reliance
on the Interim Servicer.
The
Interim Servicer will furnish, with respect to each Mortgage Loan, in accordance
with the Fair Credit Reporting Act and its implementing regulations, accurate
and complete information on its borrower credit files to Equifax, Experian,
and
Trans Union Credit Information Company, on a monthly basis.
| Subsection 11.02 |
Collection
of Mortgage Loan Payments.
|
Continuously
from the date hereof until the principal and interest on all Mortgage Loans
are
paid in full, the Interim Servicer shall proceed diligently to collect all
payments due under each Mortgage Loan when the same shall become due and payable
and shall, to the extent such procedures shall be consistent with this
Agreement, follow such collection procedures as it follows with respect to
mortgage loans comparable to the Mortgage Loans and held for its own account.
Further, the Interim Servicer shall take special care in ascertaining and
estimating annual ground rents, taxes, assessments, water rates, fire and hazard
insurance premiums, mortgage insurance premiums, and all other charges that,
as
provided in the Mortgage, will become due and payable to the end that the
installments payable by the Mortgagors will be sufficient to pay such charges
as
and when they become due and payable.
The
Interim Servicer shall not waive any Prepayment Charge with respect to any
Mortgage Loan which contains a Prepayment Charge which prepays during the term
of the charge. If the Interim Servicer fails to collect the Prepayment Charge
upon any prepayment of any Mortgage Loan which contains a Prepayment Charge,
the
Interim Servicer shall pay the Purchaser at such time (by deposit to the
Custodial Account) an amount equal to amount of the Prepayment Charge which
was
not collected. Notwithstanding the above, the Interim Servicer may waive (and
shall waive, in the case of (v) below) a Prepayment Charge without paying the
Purchaser the amount of the Prepayment Charge (i) if the Mortgage Loan is in
default (defined as 61 days or more delinquent) and such waiver would maximize
recovery of total proceeds taking into account the value of such Prepayment
Charge and the related Mortgage Loan, (ii) if the prepayment is not a result
of
a refinancing by the Interim Servicer or any of its affiliates and the Mortgage
Loan is foreseen to be in default and such waiver would maximize recovery of
total proceeds taking into account the value of such Prepayment Charge and
the
related Mortgage Loan, (iii) if the collection of the Prepayment Charge would
be
in violation of applicable laws, (iv) if the collection of such Prepayment
Charge would be considered “predatory” pursuant to written guidance published or
issued by any applicable federal, state or local regulatory authority acting
in
its official capacity and having jurisdiction over such matters and (v)
notwithstanding any state or federal law to the contrary, any instance when
a
Mortgage Loan is in foreclosure. The Interim Servicer hereby acknowledges that
for the purposes of the preceding sentence, the law applicable to the
enforcement of prepayment penalties and charges is the law applicable to the
related originator of the Mortgage Loans. In the event the Interim Servicer
determines that (i) the foregoing acknowledgement is no longer accurate and
(ii)
applicable state law would prevent it from fully enforcing prepayment penalties
or charges, the Interim Servicer shall (i) provide prompt notice to such effect
to the Purchaser and (ii) provide a written opinion of counsel from a nationally
recognized law firm experienced in regulatory matters concluding that fully
enforcing prepayment penalties or charges would violate applicable
law.
| Subsection 11.03 |
Realization
Upon Defaulted Mortgage Loans.
|
(a) The
Interim Servicer shall use its best efforts, consistent with the procedures
that
the Interim Servicer would use in servicing loans for its own account, to
foreclose upon or otherwise comparably convert the ownership of such Mortgaged
Properties as come into and continue in default and as to which no satisfactory
arrangements can be made for collection of delinquent payments pursuant to
Subsection 11.01. The Interim Servicer shall use its best efforts to
realize upon defaulted Mortgage Loans in such a manner as will maximize the
receipt of principal and interest by the Purchaser, taking into account, among
other things, the timing of foreclosure proceedings. The foregoing is subject
to
the provisions that, in any case in which Mortgaged Property shall have suffered
damage, the Interim Servicer shall not be required to expend its own funds
toward the restoration of such property in excess of $2,000 unless it shall
determine in its discretion (i) that such restoration will increase the proceeds
of liquidation of the related Mortgage Loan to Purchaser after reimbursement
to
itself for such expenses, and (ii) that such expenses will be recoverable by
the
Interim Servicer through Insurance Proceeds or Liquidation Proceeds from the
related Mortgaged Property, as contemplated in Subsection 11.05. In the
event that any payment due under any Mortgage Loan is not paid when the same
becomes due and payable, or in the event the Mortgagor fails to perform any
other covenant or obligation under the Mortgage Loan and such failure continues
beyond any applicable grace period, the Interim Servicer shall take such action
as it shall deem to be in the best interest of the Purchaser. In the event
that
any payment due under any Mortgage Loan remains delinquent for a period of
ninety (90) days or more, the Interim Servicer shall commence foreclosure
proceedings, provided that prior to commencing foreclosure proceedings, the
Interim Servicer shall notify the Purchaser in writing of the Interim Servicer's
intention to do so, and the Interim Servicer shall not commence foreclosure
proceedings if the Purchaser objects to such action within ten (10) Business
Days of receiving such notice. The Interim Servicer shall notify the Purchaser
in writing of the commencement of foreclosure proceedings. In such connection,
the Interim Servicer shall be responsible for all costs and expenses incurred
by
it in any such proceedings; provided, however, that it shall be entitled to
reimbursement thereof from the related Mortgaged Property, as contemplated
in
Subsection 11.05.
(b) Notwithstanding
the foregoing provisions of this Subsection 11.03, with respect to any
Mortgage Loan as to which the Interim Servicer has received actual notice of,
or
has actual knowledge of, the presence of any toxic or hazardous substance on
the
related Mortgaged Property the Interim Servicer shall not either (i) obtain
title to such Mortgaged Property as a result of or in lieu of foreclosure or
otherwise, or (ii) otherwise acquire possession of, or take any other action,
with respect to, such Mortgaged Property if, as a result of any such action,
the
Purchaser would be considered to hold title to, to be a mortgagee-in-possession
of, or to be an owner or operator of such Mortgaged Property within the meaning
of the Comprehensive Environmental Response, Compensation and Liability Act
of
1980, as amended from time to time, or any comparable law, unless the Interim
Servicer has also previously determined, based on its reasonable judgment and
a
prudent report prepared by a Person who regularly conducts environmental audits
using customary industry standards, that:
(1) such
Mortgaged Property is in compliance with applicable environmental laws or,
if
not, that it would be in the best economic interest of the Purchaser to take
such actions as are necessary to bring the Mortgaged Property into compliance
therewith; and
(2) there
are
no circumstances present at such Mortgaged Property relating to the use,
management or disposal of any hazardous substances, hazardous materials,
hazardous wastes, or petroleum-based materials for which investigation, testing,
monitoring, containment, clean-up or remediation could be required under any
federal, state or local law or regulation, or that if any such materials are
present for which such action could be required, that it would be in the best
economic interest of the Purchaser to take such actions with respect to the
affected Mortgaged Property.
The
cost
of the environmental audit report contemplated by this Subsection 11.03
shall be advanced by the Interim Servicer, subject to the Interim Servicer's
right to be reimbursed therefor from the Custodial Account as provided in
Subsection 11.05(v).
If
the
Interim Servicer determines, as described above, that it is in the best economic
interest of the Purchaser to take such actions as are necessary to bring any
such Mortgaged Property into compliance with applicable environmental laws,
or
to take such action with respect to the containment, clean-up or remediation
of
hazardous substances, hazardous materials, hazardous wastes, or petroleum-based
materials affecting any such Mortgaged Property, then the Interim Servicer
shall
take such action as it deems to be in the best economic interest of the
Purchaser. The cost of any such compliance, containment, cleanup or remediation
shall be advanced by the Interim Servicer, subject to the Interim Servicer's
right to be reimbursed therefor from the Custodial Account as provided in
Subsection 11.05(v).
(c) Proceeds
received in connection with any Final Recovery Determination, as well as any
recovery resulting from a partial collection of Insurance Proceeds or
Liquidation Proceeds in respect of any Mortgage Loan, will be applied in the
following order of priority: first,
to
reimburse the Interim Servicer for any related unreimbursed Servicing Advances,
pursuant to Subsection 11.05(iii); second,
to
accrued and unpaid interest on the Mortgage Loan, to the date of the Final
Recovery Determination, or to the Due Date prior to the Distribution Date on
which such amounts are to be distributed if not in connection with a Final
Recovery Determination; and third,
as a
recovery of principal of the Mortgage Loan. If the amount of the recovery so
allocated to interest is less than the full amount of accrued and unpaid
interest due on such Mortgage Loan, the amount of such recovery will be
allocated by the Interim Servicer as follows: first,
to
unpaid Servicing Fees; and second,
to the
balance of the interest then due and owing. The portion of the recovery so
allocated to unpaid Servicing Fees shall be reimbursed to the Interim Servicer
pursuant to Subsection 11.05(iii).
| Subsection 11.04 |
Establishment
of Custodial Accounts; Deposits in Custodial Accounts.
|
The
Interim Servicer shall segregate and hold all funds collected and received
pursuant to each Mortgage Loan separate and apart from any of its own funds
and
general assets and shall establish and maintain one or more Custodial Accounts,
in the form of time deposit or demand accounts. The creation of any Custodial
Account shall be evidenced by a Custodial Account Letter Agreement in the form
of Exhibit 7.
The
Interim Servicer shall deposit in the Custodial Account on a daily basis, and
retain therein the following payments and collections received by it subsequent
to the Cut-off Date, or received by it prior to the Cut-off Date but allocable
to a period subsequent thereto, other than in respect of principal and interest
on the Mortgage Loans due on or before the Cut-off Date:
(i) all
payments on account of principal on the Mortgage Loans;
(ii) all
payments on account of interest on the Mortgage Loans;
(iii) all
Liquidation Proceeds;
(iv) all
Insurance Proceeds including amounts required to be deposited pursuant to
Subsections 11.10 and 11.11, other than proceeds to be held in the Escrow
Account and applied to the restoration or repair of the Mortgaged Property
or
released to the Mortgagor in accordance with the Interim Servicer's normal
servicing procedures, the loan documents or applicable law;
(v) all
Condemnation Proceeds affecting any Mortgaged Property which are not released
to
the Mortgagor in accordance with the Interim Servicer's normal servicing
procedures, the loan documents or applicable law;
(vi) all
proceeds of any Mortgage Loan repurchased in accordance with Subsections 7.03
and 7.04 and all amounts required to be deposited by the Interim Servicer in
connection with shortfalls in principal amount of Qualified Substitute Mortgage
Loans pursuant to Subsection 7.03;
(vii) any
amounts required to be deposited by the Interim Servicer pursuant to
Subsection 11.11 in connection with the deductible clause in any blanket
hazard insurance policy. Such deposit shall be made from the Interim Servicer's
own funds, without reimbursement therefor;
(viii) any
amounts required to be deposited by the Interim Servicer in connection with
any
REO Property pursuant to Subsection 11.13; and
(ix) any
amounts required to be deposited in the Custodial Account pursuant to
Subsections 11.19 or 11.20.
The
foregoing requirements for deposit in the Custodial Account shall be exclusive,
it being understood and agreed that, without limiting the generality of the
foregoing, payments in the nature of late payment charges and assumption fees,
to the extent permitted by Subsection 11.01, need not be deposited by the
Interim Servicer in the Custodial Account. Such Custodial Account shall be
an
Eligible Account. Any interest or earnings on funds deposited in the Custodial
Account by the depository institution shall accrue to the benefit of the Interim
Servicer and the Interim Servicer shall be entitled to retain and withdraw
such
interest from the Custodial Account pursuant to Subsection 11.05(iii). The
Interim Servicer shall give notice to the Purchaser of the location of the
Custodial Account when established and prior to any change thereof.
If
the
balance on deposit in the Custodial Account exceeds $75,000 as of the
commencement of business on any Business Day and the Custodial Account
constitutes an Eligible Account solely pursuant to clause (ii) of the definition
of Eligible Account, the Interim Servicer shall, on or before twelve o'clock
noon Eastern time on such Business Day, withdraw from the Custodial Account
any
and all amounts payable to the Purchaser and remit such amounts to the Purchaser
by wire transfer of immediately available funds.
| Subsection 11.05 |
Permitted
Withdrawals From the Custodial Account.
|
The
Interim Servicer may, from time to time, withdraw from the Custodial Account
for
the following purposes:
(i) to
make
distributions to the Purchaser in the amounts and in the manner provided for
in
Subsections 11.05 and 11.14;
(ii) to
reimburse itself for unreimbursed Servicing Advances, the Interim Servicer's
right to reimburse itself pursuant to this subclause (ii) with respect to any
Mortgage Loan being limited to related Liquidation Proceeds, Condemnation
Proceeds, Insurance Proceeds and such other amounts as may be collected by
the
Interim Servicer from the Mortgagor or otherwise relating to the Mortgage Loan,
it being understood that, in the case of such reimbursement, the Interim
Servicer's right thereto shall be prior to the rights of the Purchaser, except
that, where the Interim Servicer is required to repurchase a Mortgage Loan,
pursuant to Subsection 7.03 or 7.04, the Interim Servicer's right to such
reimbursement shall be subsequent to the payment to the Purchaser of the
Repurchase Price pursuant to Subsection 7.03 or 7.04 and all other amounts
required to be paid to the Purchaser with respect to such Mortgage
Loans;
(iii) to
pay to
itself pursuant to Subsection 11.21 as servicing compensation (a) any
interest earned on funds in the Custodial Account (all such interest to be
withdrawn monthly not later than each Distribution Date), and (b) the Servicing
Fee from that portion of any payment or recovery as to interest on a particular
Mortgage Loan;
(iv) to
pay to
itself with respect to each Mortgage Loan that has been repurchased pursuant
to
Subsection 7.03 or Subsection 7.04 all amounts received thereon and not
distributed as of the date on which the related Repurchase Price is
determined;
(v) to
pay,
or to reimburse the Interim Servicer for advances in respect of, expenses
incurred in connection with any Mortgage Loan pursuant to
Subsection 11.03(b), but only to the extent of amounts received in respect
of the Mortgage Loans to which such expense is attributable;
(vi) to
clear
and terminate the Custodial Account on the termination of this
Agreement.
The
Interim Servicer shall keep and maintain separate accounting, on a Mortgage
Loan
by Mortgage Loan basis, for the purpose of justifying any withdrawal from the
Custodial Account pursuant to such subclauses (ii) - (v) above.
| Subsection 11.06 |
Establishment
of Escrow Accounts; Deposits in Escrow Accounts.
|
The
Interim Servicer shall segregate and hold all funds collected and received
pursuant to each Mortgage Loan which constitute Escrow Payments separate and
apart from any of its own funds and general assets and shall establish and
maintain one or more Escrow Accounts, in the form of time deposit or demand
accounts. The creation of any Escrow Account shall be evidenced by Escrow
Account Letter Agreement in the form of Exhibit 8.
The
Interim Servicer shall deposit in the Escrow Account or Accounts on a daily
basis, and retain therein, (i) all Escrow Payments collected on account of
the
Mortgage Loans, for the purpose of effecting timely payment of any such items
as
required under the terms of this Agreement, and (ii) all Insurance Proceeds
which are to be applied to the restoration or repair of any Mortgaged Property.
The Interim Servicer shall make withdrawals therefrom only to effect such
payments as are required under this Agreement, and for such other purposes
as
shall be as set forth or in accordance with Subsection 11.08. The Interim
Servicer shall be entitled to retain any interest paid on funds deposited in
the
Escrow Account by the depository institution other than interest on escrowed
funds required by law to be paid to the Mortgagor and, to the extent required
by
law, the Interim Servicer shall pay interest on escrowed funds to the Mortgagor
notwithstanding that the Escrow Account is non-interest bearing or that interest
paid thereon is insufficient for such purposes.
| Subsection 11.07 |
Permitted
Withdrawals From Escrow Account.
|
Withdrawals
from the Escrow Account may be made by the Interim Servicer (i) to effect timely
payments of ground rents, taxes, assessments, water rates, hazard insurance
premiums, and comparable items, (ii) to reimburse the Interim Servicer for
any
Servicing Advance made by the Interim Servicer with respect to a related
Mortgage Loan but only from amounts received on the related Mortgage Loan which
represent late payments or collections of Escrow Payments thereunder, (iii)
to
refund to the Mortgagor any funds as may be determined to be overages, (iv)
for
transfer to the Custodial Account in accordance with the terms of this
Agreement, (v) for application to restoration or repair of the Mortgaged
Property, (vi) to pay to the Interim Servicer, or to the Mortgagor to the extent
required by law, any interest paid on the funds deposited in the Escrow Account,
or (vii) to clear and terminate the Escrow Account on the termination of this
Agreement.
| Subsection 11.08 |
Payment
of Taxes, Insurance and Other Charges.
|
With
respect to each Mortgage Loan, the Interim Servicer shall maintain accurate
records reflecting the status of ground rents, taxes, assessments, water rates
and other charges which are or may become a lien upon the Mortgaged Property
and
the status of fire
and
hazard insurance coverage and shall obtain, from time to time, all bills for
the
payment of such charges, including insurance renewal premiums and shall effect
payment thereof prior to the applicable penalty or termination date and at
a
time appropriate for securing maximum discounts allowable, employing for such
purpose deposits of the Mortgagor in the Escrow Account which shall have been
estimated and accumulated by the Interim Servicer in amounts sufficient for
such
purposes, as allowed under the terms of the Mortgage and applicable law. To
the
extent that the Mortgage does not provide for Escrow Payments, the Interim
Servicer shall determine that any such payments are made by the Mortgagor at
the
time they first become due. The Interim Servicer assumes full responsibility
for
the timely payment of all such bills and shall effect timely payments of all
such bills irrespective of the Mortgagor’s faithful performance in the payment
of same or the making of the Escrow Payments and shall make advances from its
own funds to effect such payments.
| Subsection 11.09 |
Transfer
of Accounts.
|
The
Interim Servicer may transfer the Custodial Account or the Escrow Account to
a
different depository institution from time to time. Such transfer shall be
made
only upon obtaining the consent of the Purchaser, which consent shall not be
unreasonably withheld. In any case, the Custodial Account and Escrow Account
shall be Eligible Accounts.
| Subsection 11.10 |
Maintenance
of Hazard Insurance.
|
The
Interim Servicer shall cause to be maintained for each Mortgage Loan fire and
hazard insurance with extended coverage as is customary in the area where the
Mortgaged Property is located in an amount which is at least equal to the lesser
of (i) the amount necessary to fully compensate for any damage or loss to the
improvements which are a part of such property on a replacement cost basis
or
(ii) the sum of the outstanding principal balance of the Mortgage Loan
(including any cumulative related Negative Amortization) and the outstanding
principal balance of the related first lien mortgage loan, if applicable, in
each case in an amount not less than such amount as is necessary to prevent
the
Mortgagor and/or the Mortgagee from becoming a co-insurer. If the Mortgaged
Property is in an area identified on a Flood Hazard Boundary Map or Flood
Insurance Rate Map issued by the Flood Emergency Management Agency as having
special flood hazards and such flood insurance has been made available, the
Interim Servicer will cause to be maintained a flood insurance policy meeting
the requirements of the current guidelines of the Federal Insurance
Administration with a generally acceptable insurance carrier, in an amount
representing coverage not less than the lesser of (i) the outstanding principal
balance of the Mortgage Loan (plus, if the Mortgage Loan provides for negative
amortization, the maximum amount of Negative Amortization in accordance with
the
Mortgage) or (ii) the maximum amount of insurance which is available under
the
National Flood Insurance Act of 1968 or the Flood Disaster Protection Act of
1973, as amended. The Interim Servicer also shall maintain on any REO Property,
fire and hazard insurance with extended coverage in an amount which is at least
equal to the lesser of (i) the maximum insurable value of the improvements
which
are a part of such property and (ii) the outstanding principal balance of the
related Mortgage Loan (including any cumulative related Negative Amortization)
at the time it became an REO Property plus accrued interest at the Mortgage
Interest Rate and related Servicing Advances, liability insurance and, to the
extent required and available under the National Flood Insurance Act of 1968
or
the Flood Disaster Protection Act of 1973, as amended, flood insurance in an
amount as provided above. Pursuant to Subsection 11.04, any amounts
collected by the Interim Servicer under any such policies other than amounts
to
be deposited in the Escrow Account and applied to the restoration or repair
of
the Mortgaged Property or REO Property, or released to the Mortgagor in
accordance with the Interim Servicer's normal servicing procedures, shall be
deposited in the Custodial Account, subject to withdrawal pursuant to
Subsection 11.05. Any cost incurred by the Interim Servicer in maintaining
any such insurance shall not, for the purpose of calculating distributions
to
the Purchaser, be added to the unpaid principal balance of the related Mortgage
Loan, notwithstanding that the terms of such Mortgage Loan so permit. It is
understood and agreed that no earthquake or other additional insurance need
be
required by the Interim Servicer of the Mortgagor or maintained on property
acquired in respect of the Mortgage Loan, other than pursuant to such applicable
laws and regulations as shall at any time be in force and as shall require
such
additional insurance. All such policies shall be endorsed with standard
mortgagee clauses with loss payable to the Interim Servicer, or upon request
to
the Purchaser, and shall provide for at least thirty (30) days prior written
notice of any cancellation, reduction in the amount of, or material change
in,
coverage to the Interim Servicer. The Interim Servicer shall not interfere
with
the Mortgagor's freedom of choice in selecting either his insurance carrier
or
agent, provided, however, that the Interim Servicer shall not accept any such
insurance policies from insurance companies unless such companies currently
reflect a General Policy Rating of A:VI or better in Best's Key Rating Guide,
are acceptable to Xxxxxx Xxx and Xxxxxxx Mac and are licensed to do business
in
the state wherein the property subject to the policy is located.
| Subsection 11.11 |
Maintenance
of Mortgage Impairment Insurance Policy.
|
In
the
event that the Interim Servicer shall obtain and maintain a mortgage impairment
or blanket policy issued by an issuer that has a rating in Best's Key Rating
Guide of A:VI insuring against hazard losses on all of Mortgaged Properties
securing the Mortgage Loans, then, to the extent such policy provides coverage
in an amount equal to the amount required pursuant to Subsection 11.10 and
otherwise complies with all other requirements of Subsection 11.10, the
Interim Servicer shall conclusively be deemed to have satisfied its obligations
as set forth in Subsection 11.10, it being understood and agreed that such
policy may contain a deductible clause, in which case the Interim Servicer
shall, in the event that there shall not have been maintained on the related
Mortgaged Property or REO Property a policy complying with
Subsection 11.10, and there shall have been one or more losses which would
have been covered by such policy, deposit in the Custodial Account the amount
not otherwise payable under the blanket policy because of such deductible
clause. In connection with its activities as servicer of the Mortgage Loans,
the
Interim Servicer agrees to prepare and present, on behalf of the Purchaser,
claims under any such blanket policy in a timely fashion in accordance with
the
terms of such policy. Upon request of the Purchaser, the Interim Servicer shall
cause to be delivered to the Purchaser a certified true copy of such policy
and
a statement from the insurer thereunder that such policy shall in no event
be
terminated or materially modified without thirty (30) days prior written notice
to the Purchaser.
| Subsection 11.12 |
Fidelity
Bond, Errors and Omissions Insurance.
|
The
Interim Servicer shall maintain, at its own expense, a blanket fidelity bond
and
an errors and omissions insurance policy, with broad coverage with responsible
companies that would meet the requirements of Xxxxxx Mae or Xxxxxxx Mac on
all
officers, employees or other persons acting in any capacity with regard to
the
Mortgage Loans to handle funds, money, documents and papers relating to the
Mortgage Loans. The fidelity bond and errors and omissions insurance shall
be in
the form of the Mortgage Banker's Blanket Bond and shall protect and insure
the
Interim Servicer against losses, including forgery, theft, embezzlement, fraud,
errors and omissions and negligent acts of such persons. Such fidelity bond
shall also protect and insure the Interim Servicer against losses in connection
with the failure to maintain any insurance policies required pursuant to this
Agreement and the release or satisfaction of a Mortgage Loan without having
obtained payment in full of the indebtedness secured thereby. No provision
of
this Subsection 11.12 requiring the fidelity bond and errors and omissions
insurance shall diminish or relieve the Interim Servicer from its duties and
obligations as set forth in this Agreement. The minimum coverage under any
such
bond and insurance policy shall be at least equal to the corresponding amounts
required by Xxxxxx Xxx in the Xxxxxx Mae Servicing Guide or by Xxxxxxx Mac
in
the Xxxxxxx Xxx Xxxxxxx' and Servicers' Guide. Upon request of the Purchaser,
the Interim Servicer shall cause to be delivered to the Purchaser a certified
true copy of the fidelity bond and insurance policy and a statement from the
surety and the insurer that such fidelity bond or insurance policy shall in
no
event be terminated or materially modified without thirty (30) days' prior
written notice to the Purchaser.
| Subsection 11.13 |
Title,
Management and Disposition of REO Property.
|
In
the
event that title to the Mortgaged Property is acquired in foreclosure or by
deed
in lieu of foreclosure, the deed or certificate of sale shall be taken in the
name of the person designated by the Purchaser. Any Person or Persons holding
such title other than the Purchaser shall acknowledge in writing that such
title
is being held as nominee for the benefit of the Purchaser.
The
Interim Servicer shall either itself or through an agent selected by the Interim
Servicer, manage, conserve, protect and operate each REO Property (and may
temporarily rent the same) in the same manner that it manages, conserves,
protects and operates other foreclosed property for its own account, and in
the
same manner that similar property in the same locality as the REO Property
is
managed. If a REMIC election is or is to be made with respect to the arrangement
under which the Mortgage Loans and any REO Property are held, the Interim
Servicer shall manage, conserve, protect and operate each REO Property in a
manner which does not cause such REO Property to fail to qualify as “foreclosure
property” within the meaning of Section 860G(a)(8) of the Code or result in
the receipt by such REMIC of any “income from non-permitted assets” within the
meaning of Section 860F(a)(2)(B) of the Code or any “net income from
foreclosure property” within the meaning of Section 860G(c)(2) of the Code.
The Interim Servicer shall cause each REO Property to be inspected promptly
upon
the acquisition of title thereto and shall cause each REO Property to be
inspected at least monthly thereafter. The Interim Servicer shall make or cause
to be made a written report of each such inspection. Such reports shall be
retained in the Mortgage File and copies thereof shall be forwarded by the
Interim Servicer to the Purchaser. The Interim Servicer shall use its best
efforts to dispose of the REO Property as soon as possible and shall sell such
REO Property in any event within one year after title has been taken to such
REO
Property, unless the Interim Servicer determines, and gives appropriate notice
to the Purchaser, that a longer period is necessary for the orderly liquidation
of such REO Property. If a period longer than one year is necessary to sell
any
REO property, (i) the Interim Servicer shall report monthly to the Purchaser
as
to the progress being made in selling such REO Property and (ii) if, with the
written consent of the Purchaser, a purchase money mortgage is taken in
connection with such sale, such purchase money mortgage shall name the Interim
Servicer as mortgagee, and a separate servicing agreement between the Interim
Servicer and the Purchaser shall be entered into with respect to such purchase
money mortgage. Notwithstanding the foregoing, if a REMIC election is made
with
respect to the arrangement under which the Mortgage Loans and the REO Property
are held, such REO Property shall be disposed of before the close of the third
taxable year following the taxable year in which the Mortgage Loan became an
REO
Property, unless the Interim Servicer provides to the trustee under such REMIC
an opinion of counsel to the effect that the holding of such REO Property
subsequent to the close of the third taxable year following the taxable year
in
which the Mortgage Loan became an REO Property, will not result in the
imposition of taxes on "prohibited transactions" as defined in Section 860F
of
the Code, or cause the transaction to fail to qualify as a REMIC at any time
that certificates are outstanding. Interim Servicer shall manage, conserve,
protect and operate each such REO Property for the certificateholders solely
for
the purpose of its prompt disposition and sale in a manner which does not cause
such property to fail to qualify as "foreclosure property" within the meaning
of
Section 860F(a)(2)(E) of the Code, or any "net income from foreclosure property"
which is subject to taxation under the REMIC provisions of the Code. Pursuant
to
its efforts to sell such property, the Interim Servicer shall either itself
or
through an agent selected by Interim Servicer, protect and conserve such
property in the same manner and to such an extent as is customary in the
locality where such property is located. Additionally, Interim Servicer shall
perform the tax withholding and reporting related to Sections 1445 and 6050J
of
the Code.
With
respect to each REO Property, the Interim Servicer shall segregate and hold
all
funds collected and received in connection with the operation of the REO
Property separate and apart from its own funds or general assets and shall
establish and maintain a separate REO Account for each REO Property in the
form
of a non-interest bearing demand account, unless an Opinion of Counsel is
obtained by the Interim Servicer to the effect that the classification as a
grantor trust or REMIC for federal income tax purposes of the arrangement under
which the Mortgage Loans and the REO Property is held will not be adversely
affected by holding such funds in another manner. Each REO Account shall be
established with the Interim Servicer or, with the prior consent of the
Purchaser, with a commercial bank, a mutual savings bank or a savings
association. The creation of any REO Account shall be evidenced by a letter
agreement substantially in the form of the Custodial Account Letter Agreement
attached as Exhibit 7 hereto. An original of such letter agreement shall be
furnished to any Purchaser upon request.
The
Interim Servicer shall deposit or cause to be deposited, on a daily basis in
each REO Account all revenues received with respect to the related REO Property
and shall withdraw therefrom funds necessary for the proper operation,
management and maintenance of the REO Property, including the cost of
maintaining any hazard insurance pursuant to Subsection 11.10 hereof and
the fees of any managing agent acting on behalf of the Interim Servicer. The
Interim Servicer shall not be entitled to retain interest paid or other
earnings, if any, on funds deposited in such REO Account. On or before each
Determination Date, the Interim Servicer shall withdraw from each REO Account
and deposit into the Custodial Account the net income from the REO Property
on
deposit in the REO Account.
The
Interim Servicer shall furnish to the Purchaser on each Distribution Date,
an
operating statement for each REO Property covering the operation of each REO
Property for the previous month. Such operating statement shall be accompanied
by such other information as the Purchaser shall reasonably request. Together
with such statement, the Interim Servicer shall furnish to the Purchaser a
statement covering the Interim Servicer’s efforts in connection with the sale of
such REO Property and any rental of such REO Property incidental to the sale
thereof for the previous month.
Each
REO
Disposition shall be carried out by the Interim Servicer at such price and
upon
such terms and conditions as the Interim Servicer deems to be in the best
interest of the Purchaser only with the prior written consent of the Purchaser.
If as of the date title to any REO Property was acquired by the Interim Servicer
there were outstanding unreimbursed Servicing Advances with respect to the
REO
Property, the Interim Servicer, upon an REO Disposition of such REO Property,
shall be entitled to reimbursement for any related unreimbursed Servicing
Advances from proceeds received in connection with such REO Disposition. The
proceeds from the REO Disposition, net of any payment to the Interim Servicer
as
provided above, shall be deposited in the REO Account and shall be transferred
to the Custodial Account on the Determination Date in the month following
receipt thereof for distribution on the succeeding Distribution Date in
accordance with Subsection 11.14.
| Subsection 11.14 |
Distributions.
|
On
each
Distribution Date, the Interim Servicer shall distribute to the Purchaser all
amounts credited to the Custodial Account as of the close of business on the
preceding Determination Date, net of charges against or withdrawals from the
Custodial Account pursuant to Subsection 11.05.
All
distributions made to the Purchaser on each Distribution Date will be made
to
the Purchaser of record on the preceding Record Date, and shall be based on
the
Mortgage Loans owned and held by the Purchaser, and shall be made by wire
transfer of immediately available funds to the account of the Purchaser at
a
bank or other entity having appropriate facilities therefor, if the Purchaser
shall have so notified the Interim Servicer or by check mailed to the address
of
the Purchaser.
With
respect to any remittance received by the Purchaser on or after the second
Business Day following the Business Day on which such payment was due, the
Interim Servicer shall pay to the Purchaser interest on any such late payment
at
an annual rate equal to the rate of interest as is publicly announced from
time
to time at its principal office by JPMorgan Chase Bank, New York, New York,
as
its prime lending rate, adjusted as of the date of each change, plus three
(3)
percentage points, but in no event greater than the maximum amount permitted
by
applicable law. Such interest shall be paid by the Interim Servicer to the
Purchaser on the date such late payment is made and shall cover the period
commencing with the day following such second Business Day and ending with
the
Business Day on which such payment is made, both inclusive. Such interest shall
be remitted along with such late payment. The payment by the Interim Servicer
of
any such interest shall not be deemed an extension of time for payment or a
waiver of any Event of Default by the Interim Servicer.
| Subsection 11.15 |
Remittance
Reports.
|
No
later
than the fifth Business Day of each month, the Interim Servicer shall furnish
to
the Purchaser or its designee an electronic file containing, and a hard copy
of,
the monthly data specified on Exhibit 13 hereto in a form acceptable to the
Purchaser and the Interim Servicer (the “Remittance Report”). On the Business
Day following each Determination Date, the Interim Servicer shall deliver to
the
Purchaser or its designee by telecopy (or by such other means as the Interim
Servicer and the Purchaser may agree from time to time) an electronic file
containing, and a hard copy of, the determination data with respect to the
related Distribution Date, together with such other information with respect
to
the Mortgage Loans as the Purchaser may reasonably require to allocate
distributions made pursuant to this Agreement and provide appropriate statements
with respect to such distributions. On the same date, the Interim Servicer
shall
forward to the Purchaser by e-mail an electronic file in a form acceptable
to
the Purchaser containing the information set forth in the Remittance Report
with
respect to the related Distribution Date.
| Subsection 11.16 |
Statements
to the Purchaser.
|
Not
later
than fifteen (15) days after each Distribution Date, the Interim Servicer shall
forward to the Purchaser or its designee a statement prepared by the Interim
Servicer setting forth the status of the Custodial Account as of the close
of
business on such Distribution Date and showing, for the period covered by such
statement, the aggregate amount of deposits into and withdrawals from the
Custodial Account of each category of deposit specified in Subsection 11.04
and each category of withdrawal specified in Subsection 11.05.
In
addition, not more than sixty (60) days after the end of each calendar year,
the
Interim Servicer shall furnish to each Person who was the Purchaser at any
time
during such calendar year, (i) as to the aggregate of remittances for the
applicable portion of such year, an annual statement in accordance with the
requirements of applicable federal income tax law, and (ii) listing of the
principal balances of the Mortgage Loans outstanding at the end of such calendar
year.
The
Interim Servicer shall prepare and file any and all tax returns, information
statements or other filings required to be delivered to any governmental taxing
authority or to any Purchaser pursuant to any applicable law with respect to
the
Mortgage Loans and the transactions contemplated hereby. In addition, the
Interim Servicer shall provide the Purchaser with such information concerning
the Mortgage Loans as is necessary for the Purchaser to prepare its federal
income tax return as any Purchaser may reasonably request from time to
time.
| Subsection 11.17 |
Real
Estate Owned Reports.
|
Together
with the statement furnished pursuant to Subsection 11.02, with respect to
any REO Property, the Interim Servicer shall furnish to the Purchaser a
statement covering the Interim Servicer's efforts in connection with the sale
of
such REO Property and any rental of such REO Property incidental to the sale
thereof for the previous month, together with the operating statement. Such
statement shall be accompanied by such other information as the Purchaser shall
reasonably request.
| Subsection 11.18 |
Liquidation
Reports.
|
Upon
the
foreclosure sale of any Mortgaged Property or the acquisition thereof by the
Purchaser pursuant to a deed-in-lieu of foreclosure, the Interim Servicer shall
submit to the Purchaser a liquidation report with respect to such Mortgaged
Property.
| Subsection 11.19 |
Assumption
Agreements.
|
The
Interim Servicer shall, to the extent it has knowledge of any conveyance or
prospective conveyance by any Mortgagor of the Mortgaged Property (whether
by
absolute conveyance or by contract of sale, and whether or not the Mortgagor
remains or is to remain liable under the Mortgage Note and/or the Mortgage),
exercise its rights to accelerate the maturity of such Mortgage Loan under
any
“due-on-sale” clause applicable thereto; provided, however, that the Interim
Servicer shall not exercise any such rights if prohibited by law from doing
so.
If the Interim Servicer reasonably believes it is unable under applicable law
to
enforce such “due-on-sale” clause, the Interim Servicer shall enter into an
assumption agreement with the person to whom the Mortgaged Property has been
conveyed or is proposed to be conveyed, pursuant to which such person becomes
liable under the Mortgage Note and, to the extent permitted by applicable state
law, the Mortgagor remains liable thereon. Where an assumption is allowed
pursuant to this Subsection 11.19, the Interim Servicer is authorized to
enter into a substitution of liability agreement with the person to whom the
Mortgaged Property has been conveyed or is proposed to be conveyed pursuant
to
which the original Mortgagor is released from liability and such Person is
substituted as Mortgagor and becomes liable under the related Mortgage Note.
Any
such substitution of liability agreement shall be in lieu of an assumption
agreement.
In
connection with any such assumption or substitution of liability, the Interim
Servicer shall follow the underwriting practices and procedures of prudent
mortgage lenders in the state in which the related Mortgaged Property is
located. With respect to an assumption or substitution of liability, Mortgage
Interest Rate, the amount of the Monthly Payment, and the final maturity date
of
such Mortgage Note may not be changed. The Interim Servicer shall notify the
Purchaser that any such substitution of liability or assumption agreement has
been completed by forwarding to the Purchaser the original of any such
substitution of liability or assumption agreement, which document shall be
added
to the related Mortgage File and shall, for all purposes, be considered a part
of such Mortgage File to the same extent as all other documents and instruments
constituting a part thereof. Any fee collected by the Interim Servicer for
entering into an assumption or substitution of liability agreement in excess
of
1% of the outstanding principal balance of the Mortgage Loan shall be deposited
in the Custodial Account pursuant to Subsection 11.04.
Notwithstanding
the foregoing paragraphs of this Subsection or any other provision of this
Agreement, the Interim Servicer shall not be deemed to be in default, breach
or
any other violation of its obligations hereunder by reason of any assumption
of
a Mortgage Loan by operation of law or any assumption which the Interim Servicer
may be restricted by law from preventing, for any reason whatsoever. For
purposes of this Subsection 11.19, 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.
| Subsection 11.20 |
Satisfaction
of Mortgages and Release of Mortgage Files.
|
Upon
the
payment in full of any Mortgage Loan, or the receipt by the Interim Servicer
of
a notification that payment in full will be escrowed in a manner customary
for
such purposes, the Interim Servicer will immediately notify the Purchaser by
a
certification of a servicing officer of the Interim Servicer (a “Servicing
Officer”), which certification shall include a statement to the effect that all
amounts received or to be received in connection with such payment which are
required to be deposited in the Custodial Account pursuant to
Subsection 11.04 have been or will be so deposited, and shall request
execution of any document necessary to satisfy the Mortgage Loan and delivery
to
it of the portion of the Mortgage File held by the Purchaser or the Purchaser's
designee. Upon receipt of such certification and request, the Purchaser, shall
promptly release the related mortgage documents to the Interim Servicer and
the
Interim Servicer shall prepare and process any satisfaction or release. No
expense incurred in connection with any instrument of satisfaction or deed
of
reconveyance shall be chargeable to the Custodial Account or the
Purchaser.
In
the
event the Interim Servicer satisfies or releases a Mortgage without having
obtained payment in full of the indebtedness secured by the Mortgage or should
it otherwise prejudice any right the Purchaser may have under the mortgage
instruments, the Interim Servicer, upon written demand, shall remit to the
Purchaser the then outstanding principal balance of the related Mortgage Loan
by
deposit thereof in the Custodial Account. The Interim Servicer shall maintain
the fidelity bond insuring the Interim Servicer against any loss it may sustain
with respect to any Mortgage Loan not satisfied in accordance with the
procedures set forth herein.
From
time
to time and as appropriate for the servicing or foreclosure of any Mortgage
Loan, the Purchaser shall, upon request of the Interim Servicer and delivery
to
the Purchaser of a servicing receipt signed by a Servicing Officer, release
the
requested portion of the Mortgage Loan Documents held by the Purchaser or the
Custodian to the Interim Servicer. Such servicing receipt shall obligate the
Interim Servicer to return the related Mortgage documents to the Purchaser
when
the need therefor by the Interim Servicer no longer exists, unless the Mortgage
Loan has been liquidated and the Liquidation Proceeds relating to the Mortgage
Loan have been deposited in the Custodial Account or the Mortgage File or such
document has been delivered to an attorney, or to a public trustee or other
public official as required by law, for purposes of initiating or pursuing
legal
action or other proceedings for the foreclosure of the Mortgaged Property either
judicially or non-judicially, and the Interim Servicer has delivered to the
Purchaser a certificate of a Servicing Officer certifying as to the name and
address of the Person to which such Mortgage File or such document was delivered
and the purpose or purposes of such delivery. Upon receipt of a certificate
of a
Servicing Officer stating that such Mortgage Loan was liquidated, the servicing
receipt shall be released by the Purchaser to the Interim Servicer.
| Subsection 11.21 |
Servicing
Compensation.
|
As
compensation for its services hereunder, the Interim Servicer shall be entitled
to withdraw from the Custodial Account or to retain from interest payments
on
the Mortgage Loans the amounts provided for as the Interim Servicer's Servicing
Fee. Additional servicing compensation in the form of assumption fees, as
provided in Subsection 11.19, and late payment charges and similar
ancillary servicing compensation shall be retained by the Interim Servicer
to
the extent not required to be deposited in the Custodial Account. The Interim
Servicer shall not be permitted to retain any portion of the Prepayment Charges
collected on the Mortgage Loans, which Prepayment Charges shall be remitted
to
the Purchaser. The Interim Servicer shall be required to pay all expenses
incurred by it in connection with its servicing activities hereunder and shall
not be entitled to reimbursement therefor except as specifically provided
for.
| Subsection 11.22 |
Notification
of Adjustments.
|
On
each
Adjustment Date, the Interim Servicer shall make interest rate adjustments
for
each Adjustable Rate Mortgage Loan in compliance with the requirements of the
related Mortgage and Mortgage Note. The Interim Servicer shall execute and
deliver the notices required by each Mortgage and Mortgage Note regarding
interest rate adjustments. The Interim Servicer also shall provide timely
notification to the Purchaser of all applicable data and information regarding
such interest rate adjustments and the Interim Servicer's methods of
implementing such interest rate adjustments. Upon the discovery by the Interim
Servicer or the Purchaser that the Interim Servicer has failed to adjust a
Mortgage Interest Rate or a Monthly Payment pursuant to the terms of the related
Mortgage Note and Mortgage, the Interim Servicer shall immediately deposit
in
the Custodial Account from its own funds the amount of any interest loss caused
thereby without reimbursement therefor.
| Subsection 11.23 |
Statement
as to Compliance.
|
(a) The
Interim Servicer will deliver to the Purchaser, not later than 75 days following
the end of each calendar year, an Officers’ Certificate stating, as to each
signatory thereof, that (i) a review of the activities of the Interim Servicer
during the preceding year and of performance under this Agreement has been
made
under such officers’ supervision and (ii) to the best of such officers’
knowledge, based on such review, the Interim Servicer has fulfilled all of
its
obligations under this Agreement throughout such year, or, if there has been
a
default in the fulfillment of any such obligation, specifying each such default
known to such officer and the nature and status thereof. Copies of such
statement shall be provided by the Purchaser to any Person identified as a
prospective purchaser of the Mortgage Loans. In the event the Interim Servicer
has delegated any servicing responsibilities with respect to the Mortgage Loans
to a Subservicer, the Interim Servicer shall deliver an officer’s certificate of
the Subservicer as described above as to each Subservicer as and when required
with respect to the Interim Servicer.
(b) With
respect to any Loans that are subject to a Securitization Transaction or other
securitization transaction, by March 1 of each year (or if not a Business Day,
the immediately preceding Business Day), or at any other time upon thirty (30)
days written request, an officer of the Interim Servicer shall execute and
deliver an Officer’s Certificate to the Purchaser, any Master Servicer and any
related Depositor for the benefit of each such entity and such entity’s
affiliates and the officers, directors and agents of any such entity and such
entity’s affiliates, an Officer’s Certificate in the form attached hereto as
Exhibit 12 or Exhibit 14, as directed by the Purchaser. In the event the Interim
Servicer has delegated any servicing responsibilities with respect to the
Mortgage Loans to a Subservicer, the Interim Servicer shall deliver an officer’s
certificate of the Subservicer as described above as to each Subservicer as
and
when required with respect to the Interim Servicer.
(c) The
Interim Servicer shall indemnify and hold harmless the Master Servicer, the
Depositor, the Purchaser (and if this Agreement has been assigned in whole
or in
part by the Purchaser, any and all Persons previously acting as “Purchaser”
hereunder), and their respective officers, directors, agents and affiliates,
and
such affiliates’ officers, directors and agents (any such person, an
“Indemnified Party”) from and against any losses, damages, penalties, fines,
forfeitures, reasonable legal fees and related costs, judgments and other costs
and expenses arising out of or based upon a breach by the Interim Servicer
or
any of its officers, directors, agents or affiliates of its obligations under
this Subsection 11.23, Subsection 11.24 or Subsection 11.25, or
the negligence, bad faith or willful misconduct of the Interim Servicer in
connection therewith. If the indemnification provided for herein is unavailable
or insufficient to hold harmless any Indemnified Party, then the Interim
Servicer agrees that it shall contribute to the amount paid or payable by the
Indemnified Party as a result of the losses, claims, damages or liabilities
of
the Indemnified Party in such proportion as is appropriate to reflect the
relative fault of the Indemnified Party on the one hand and the Interim Servicer
in the other in connection with a breach of the Interim Servicer’s obligations
under this Subsection 11.23, Subsection 11.24 or
Subsection 11.25, or the Interim Servicer’s negligence, bad faith or
willful misconduct in connection therewith.
| Subsection 11.24 |
Independent
Public Accountants’ Servicing Report.
|
Not
later
than 75 days following the end of each calendar year, the Interim Servicer
at
its expense shall cause a firm of independent public accountants (which may
also
render other services to the Interim Servicer) which is a member of the American
Institute of Certified Public Accountants to furnish a statement (a “USAP
Report”)to the Purchaser or its designee to the effect that such firm has
examined certain documents and records relating to the servicing of the Mortgage
Loans under this Agreement or of mortgage loans under pooling and servicing
agreements (including the Mortgage Loans and this Agreement) substantially
similar one to another (such statement to have attached thereto a schedule
setting forth the pooling and servicing agreements covered thereby) and that,
on
the basis of such examination conducted substantially in compliance with the
Uniform Single Attestation Program for Mortgage Bankers, such firm confirms
that
such servicing has been conducted in compliance with this Agreement or such
pooling and servicing agreements, as applicable, except for such significant
exceptions or errors in records that, in the opinion of such firm, the Uniform
Single Attestation Program for Mortgage Bankers requires it to report. Copies
of
such USAP Report shall be provided by the Purchaser to any Person identified
as
a prospective purchaser of the Mortgage Loans.
| Subsection 11.25 |
Access
to Certain Documentation.
|
The
Interim Servicer shall provide to the Office of Thrift Supervision, the FDIC
and
any other federal or state banking or insurance regulatory authority that may
exercise authority over the Purchaser access to the documentation regarding
the
Mortgage Loans serviced by the Interim Servicer required by applicable laws
and
regulations. Such access shall be afforded without charge, but only upon
reasonable request and during normal business hours at the offices of the
Interim Servicer. In addition, access to the documentation will be provided
to
the Purchaser and any Person identified to the Interim Servicer by the Purchaser
without charge, upon reasonable request during normal business hours at the
offices of the Interim Servicer.
| Subsection 11.26 |
Reports
and Returns to be Filed by the Interim Servicer.
|
The
Interim Servicer shall file information reports with respect to the receipt
of
mortgage interest received in a trade or business, reports of foreclosures
and
abandonments of any Mortgaged Property and information returns relating to
cancellation of indebtedness income with respect to any Mortgaged Property
as
required by Sections 6050H, 6050J and 6050P of the Code. Such reports shall
be
in form and substance sufficient to meet the reporting requirements imposed
by
such Sections 6050H, 6050J and 6050P of the Code.
| Subsection 11.27 |
Compliance
with REMIC Provisions.
|
If
a
REMIC election has been made with respect to the arrangement under which the
Mortgage Loans and REO Property are held, the Interim Servicer shall not take
any action, cause the REMIC to take any action or fail to take (or fail to
cause
to be taken) any action that, under the REMIC Provisions, if taken or not taken,
as the case may be, could (i) endanger the status of the REMIC as a REMIC or
(ii) result in the imposition of a tax upon the REMIC (including but not limited
to the tax on “prohibited transactions” as defined in Section 860F(a)(2) of
the Code and the tax on “contributions” to a REMIC set forth in
Section 860G(d) of the Code) unless the Interim Servicer has received an
Opinion of Counsel (at the expense of the party seeking to take such action)
to
the effect that the contemplated action will not endanger such REMIC status
or
result in the imposition of any such tax.
| Subsection 11.28 |
Superior
Liens.
|
With
respect to each second lien Mortgage, the Interim Servicer shall, for the
protection of the Purchaser's interest, file (or cause to be filed) of record
a
request for notice of any action by a superior lienholder where permitted by
local law and whenever applicable state law does not require that a junior
lienholder be named as a party defendant in foreclosure proceedings in order
to
foreclose such junior lienholder's equity of redemption. The Interim Servicer
shall also notify any superior lienholder in writing of the existence of the
Mortgage Loan and request notification of any action (as described below) to
be
taken against the Borrower or the Mortgaged Property by the superior
lienholder.
If
the
Interim Servicer is notified that any superior lienholder has accelerated or
intends to accelerate the obligations secured by the superior lien, or has
declared or intends to declare a default under the superior mortgage or the
promissory note secured thereby, or has filed or intends to file an election
to
have the Mortgaged Property sold or foreclosed, the Interim Servicer shall
take
whatever actions are necessary to protect the interests of the Purchaser, and/or
to preserve the security of the related Mortgage Loan, subject to any
requirements applicable to REMICs pursuant to the Internal Revenue Code. The
Interim Servicer shall make a Servicing Advance of the funds necessary to cure
the default or reinstate the superior lien if the Interim Servicer determines
that such Servicing Advance is in the best interests of the Purchaser. The
Interim Servicer shall not make such a Servicing Advance except to the extent
that it determines that such advance would not be a Nonrecoverable Servicing
Advance from Liquidation Proceeds on the related Mortgage Loan. The Interim
Servicer shall thereafter take such action as is necessary to recover the amount
so advanced.
| Subsection 11.29 |
Sub-Servicing
Agreements Between the Interim Servicer and Subservicers.
|
The
Interim Servicer, as servicer, may arrange for the subservicing of any Mortgage
Loan by a Subservicer pursuant to a Sub-Servicing Agreement; provided that
such
sub-servicing arrangement and the terms of the related Sub-Servicing Agreement
must provide for the servicing of such Mortgage Loans in a manner consistent
with the servicing arrangements contemplated hereunder. Each Subservicer shall
be (i) authorized to transact business in the state or states where the related
Mortgaged Properties it is to service are situated, if and to the extent
required by applicable law to enable the Subservicer to perform its obligations
hereunder and under the Sub-Servicing Agreement and (ii) a Xxxxxxx Mac or Xxxxxx
Mae approved mortgage servicer. Notwithstanding the provisions of any
Sub-Servicing Agreement, any of the provisions of this Agreement relating to
agreements or arrangements between the Interim Servicer or a Subservicer or
reference to actions taken through the Interim Servicer or otherwise, the
Interim Servicer shall remain obligated and liable to the Purchaser and its
successors and assigns for the servicing and administration of the Mortgage
Loans in accordance with the provisions of this Agreement without diminution
of
such obligation or liability by virtue of such Sub-Servicing Agreements or
arrangements or by virtue of indemnification from the Subservicer and to the
same extent and under the same terms and conditions as if the Interim Servicer
alone were servicing and administering the Mortgage Loans. Every Sub-Servicing
Agreement entered into by the Interim Servicer shall contain a provision giving
the successor servicer the option to terminate such agreement in the event
a
successor servicer is appointed. All actions of each Subservicer performed
pursuant to the related Sub-Servicing Agreement shall be performed as an agent
of the Interim Servicer with the same force and effect as if performed directly
by the Interim Servicer.
For
purposes of this Agreement, the Interim Servicer shall be deemed to have
received any collections, recoveries or payments with respect to the Mortgage
Loans that are received by a Subservicer regardless of whether such payments
are
remitted by the Subservicer to the Interim Servicer.
| Subsection 11.30 |
Successor
Subservicers.
|
Any
Sub-Servicing Agreement shall provide that the Interim Servicer shall be
entitled to terminate any Sub-Servicing Agreement and to either itself directly
service the related Mortgage Loans or enter into a Sub-Servicing Agreement
with
a successor Subservicer which qualifies under Subsection 11.33. Any
Sub-Servicing Agreement shall include the provision that such agreement may
be
immediately terminated by any successor to the Interim Servicer without fee,
in
accordance with the terms of this Agreement, in the event that the Interim
Servicer (or any successor to the Interim Servicer) shall, for any reason,
no
longer be the servicer of the related Mortgage Loans (including termination
due
to an Event of Default).
| Subsection 11.31 |
No
Contractual Relationship Between Subservicer and Purchaser.
|
Any
Sub-Servicing Agreement and any other transactions or services relating to
the
Mortgage Loans involving a Subservicer shall be deemed to be between the
Subservicer and the Interim Servicer alone and the Purchaser shall not be deemed
a party thereto and shall have no claims, rights, obligations, duties or
liabilities with respect to any Subservicer except as set forth in Subsection
11.33.
| Subsection 11.32 |
Assumption
or Termination of Sub-Servicing Agreement by Successor
Servicer.
|
In
connection with the assumption of the responsibilities, duties and liabilities
and of the authority, power and rights of the Interim Servicer hereunder by
a
successor servicer pursuant to Section 16 of this Agreement, it is understood
and agreed that the Interim Servicer’s rights and obligations under any
Sub-Servicing Agreement then in force between the Interim Servicer and a
Subservicer shall be assumed simultaneously by such successor servicer without
act or deed on the part of such successor servicer; provided, however, that
any
successor servicer may terminate the Subservicer.
The
Interim Servicer shall, upon the reasonable request of the Purchaser, but at
its
own expense, deliver to the assuming party documents and records relating to
each Sub-Servicing Agreement and an accounting of amounts collected and held
by
it and otherwise use its best efforts to effect the orderly and efficient
transfer of the Sub-Servicing Agreements to the assuming party.
EXHIBIT
10
FORM
OF
ASSIGNMENT AND RECOGNITION AGREEMENT
THIS
ASSIGNMENT AND RECOGNITION AGREEMENT, dated ____________, 200__, (“Agreement”)
among
Citigroup Global Markets Realty Corp. (“Assignor”),
________________________ (“Assignee”)
and
________________________ (the “Company”):
For
and
in consideration of the sum of TEN DOLLARS ($10.00) and other valuable
consideration the receipt and sufficiency of which hereby are acknowledged,
and
of the mutual covenants herein contained, the parties hereto hereby agree as
follows:
Assignment
and Conveyance
1. The
Assignor hereby conveys, sells, grants, transfers and assigns to the Assignee
all of the right, title and interest of the Assignor, as purchaser, in, to
and
under (a) those certain Mortgage Loans listed as being originated by the Company
on the schedule (the “Mortgage
Loan Schedule”)
attached hereto as Exhibit A (the “Mortgage
Loans”)
and
(b) that certain Master Mortgage Loan Purchase and Interim Servicing Agreement
dated as of March 1, 2006, as amended (the “Purchase
Agreement”),
between the assignor, as purchaser (the “Purchaser”) and the Company, as seller,
solely insofar as the Purchase Agreement relates to the Mortgage
Loans.
The
Assignor specifically reserves and does not assign to the Assignee hereunder
any
and all right, title and interest in, to and under and any obligations of the
Assignor with respect to any mortgage loans subject to the Purchase Agreement
which are not the Mortgage Loans set forth on the Mortgage Loan Schedule and
are
not the subject of this Agreement.
Recognition
of the Company
2. [For
Securitization Transactions include this sentence: From and after the date
hereof, the Company shall and does hereby recognize that the Assignee will
transfer the Mortgage Loans and assign its rights under the Purchase Agreement
(solely to the extent set forth herein) and this Agreement to
______________________________ (the “Trust”)
created pursuant to a Pooling and Servicing Agreement, dated as of
_______________, 200__ (the “Pooling
Agreement”),
among
the Assignee, the Assignor, ____________________, as trustee (including its
successors in interest and any successor trustees under the Pooling Agreement,
the “Trustee”),
_________________________, as servicer (including its successors in interest
and
any successor servicer under the Pooling Agreement, the “Servicer”).]
The
Company hereby acknowledges and agrees that from and after the date hereof
(i) the [Trust][Assignee] will be the owner of the Mortgage Loans,
(ii) the Company shall look solely to the [Trust][Assignee] for performance
of any obligations of the Assignor insofar as they relate to the enforcement
of
the representations, warranties and covenants with respect to the Mortgage
Loans, (iii) the [Assignee][Trust (including the Trustee and the Servicer
acting on the Trust’s behalf)] shall have all the rights and remedies available
to the Assignor, insofar as they relate to the Mortgage Loans, under the
Purchase Agreement, including, without limitation, the enforcement of the
document delivery requirements and remedies with respect to breaches of
representations and warranties set forth in the Purchase Agreement, and shall
be
entitled to enforce all of the obligations of the Company thereunder insofar
as
they relate to the Mortgage Loans, and (iv) all references to the Purchaser
(insofar as they relate to the rights, title and interest and, with respect
to
obligations of the Purchaser, only insofar as they relate to the enforcement
of
the representations, warranties and covenants of the Company) or the Custodian
under the Purchase Agreement insofar as they relate to the Mortgage Loans,
shall
be deemed to refer to the [Assignee] [Trust (including the Trustee and the
Servicer acting on the Trust’s behalf)]. Neither the Company nor the Assignor
shall amend or agree to amend, modify, waiver, or otherwise alter any of the
terms or provisions of the Purchase Agreement which amendment, modification,
waiver or other alteration would in any way affect the Mortgage Loans or the
Company’s performance under the Purchase Agreement with respect to the Mortgage
Loans without the prior written consent of the [Assignee][Trustee.]
Representations
and Warranties of the Company
3. The
Company warrants and represents to the Assignor, the Assignee [and the Trust]
as
of the date hereof that:
(a) The
Company is duly organized, validly existing and in good standing under the
laws
of the jurisdiction of its incorporation;
(b)
The
Company has full power and authority to execute, deliver and perform its
obligations under this Agreement and has full power and authority to perform
its
obligations under the Purchase Agreement. The execution by the Company of this
Agreement is in the ordinary course of the Company’s business and will not
conflict with, or result in a breach of, any of the terms, conditions or
provisions of the Company’s charter or bylaws or any legal restriction, or any
material agreement or instrument to which the Company is now a party or by
which
it is bound, or result in the violation of any law, rule, regulation, order,
judgment or decree to which the Company or its property is subject. The
execution, delivery and performance by the Company of this Agreement have been
duly authorized by all necessary corporate action on part of the Company. This
Agreement has been duly executed and delivered by the Company, and, upon the
due
authorization, execution and delivery by the Assignor and the Assignee, will
constitute the valid and legally binding obligation of the Company, enforceable
against the Company in accordance with its terms except as enforceability may
be
limited by bankruptcy, reorganization, insolvency, moratorium or other similar
laws now or hereafter in effect relating to creditors’ rights generally, and by
general principles of equity regardless of whether enforceability is considered
in a proceeding in equity or at law;
(c)
No
consent, approval, order or authorization of, or declaration, filing or
registration with, any governmental entity is required to be obtained or made
by
the Company in connection with the execution, delivery or performance by the
Company of this Agreement; and
(d)
There
is
no action, suit, proceeding or investigation pending or threatened against
the
Company, before any court, administrative agency or other tribunal, which would
draw into question the validity of this Agreement or the Purchase Agreement,
or
which, either in any one instance or in the aggregate, would result in any
material adverse change in the ability of the Company to perform its obligations
under this Agreement or the Purchase Agreement, and the Company is
solvent.
4. Pursuant
to Section 12 of the Purchase Agreement, the Company hereby represents and
warrants, for the benefit of the Assignor, the Assignee [and the Trust,] that
the representations and warranties set forth in Sections 7.01 and 7.02 of the
Purchase Agreement, are true and correct (i) as of the date hereof with respect
to the origination of the Mortgage Loans and the representations and warranties
in Section 7.01 of the Purchase Agreement and (ii) the servicing transfer date
with respect to the servicing of the Mortgage Loans, except that the
representation and warranty set forth in Section 7.02(a) shall, for
purposes of this Agreement, relate to the Mortgage Loan Schedule attached
hereto.
[Additional
Representations and Warranties Necessary for
Securitization]
Remedies
for Breach of Representations and Warranties
5. The
Company hereby acknowledges and agrees that the remedies available to the
Assignor, the Assignee [and the Trust (including the Trustee and the Servicer
acting on the Trust’s behalf)] in connection with any breach of the
representations and warranties made by the Company set forth in Sections 3
and 4
hereof shall be as set forth in Subsection 7.03 of the Purchase Agreement
as if they were set forth herein (including without limitation the repurchase
and indemnity obligations set forth therein).
Miscellaneous
6. This
Agreement shall be construed in accordance with the laws of the State of New
York, without regard to conflicts of law principles, and the obligations, rights
and remedies of the parties hereunder shall be determined in accordance with
such laws.
7. No
term
or provision of this Agreement may be waived or modified unless such waiver
or
modification is in writing and signed by the party against whom such waiver
or
modification is sought to be enforced[, with the prior written consent of the
Trustee].
8. This
Agreement shall inure to the benefit of [(i)] the successors and assigns of
the
parties hereto [and (ii) the Trust (including the Trustee and the Servicer
acting on the Trust’s behalf)]. Any entity into which Assignor, Assignee or
Company may be merged or consolidated shall, without the requirement for any
further writing, be deemed Assignor, Assignee or Company, respectively,
hereunder.
9. Each
of
this Agreement and the Purchase Agreement shall survive the conveyance of the
Mortgage Loans and the assignment of the Purchase Agreement (to the extent
assigned hereunder) by Assignor to Assignee [and by Assignee to the Trust]
and
nothing contained herein shall supersede or amend the terms of the Purchase
Agreement.
10. This
Agreement may be executed simultaneously in any number of counterparts. Each
counterpart shall be deemed to be an original and all such counterparts shall
constitute one and the same instrument.
11. In
the
event that any provision of this Agreement conflicts with any provision of
the
Purchase Agreement with respect to the Mortgage Loans, the terms of this
Agreement shall control.
12. Capitalized
terms used in this Agreement (including the exhibits hereto) but not defined
in
this Agreement shall have the meanings given to such terms in the Purchase
Agreement.
[SIGNATURE
PAGE FOLLOWS]
IN
WITNESS WHEREOF, the parties have caused this Agreement to be executed by their
duly authorized officers as of the date first above written.
|
CITIGROUP
GLOBAL MARKETS REALTY CORP.
By:__________________________________
Name:________________________________
Its:___________________________________
|
|
|
______________________________________
By:__________________________________
Name:________________________________
Its:___________________________________
|
|
|
______________________________________
By:__________________________________
Name:________________________________
Its:___________________________________
|
EXHIBIT
11
FORM
OF
INDEMNIFICATION AGREEMENT
Indemnification
Agreement dated as of _________ __, 200__ (the “Agreement”) among
________________ (“Company”), __________________(“Underwriter”) and
_____________________ (the “Depositor”).
Reference
is made to the issuance of ____________________, Series ________, Asset-Backed
Certificates (the “Certificates”), pursuant to a Pooling and Servicing
Agreement, dated as of _______________ (the “Pooling and Servicing Agreement”),
among the Depositor as depositor, _________________ as master servicer and
_____________________ as trustee (the “Trustee”). The Depositor will sell
certain of the Certificates to _______________ (the “Underwriter”) for offer and
sale pursuant to the terms of an Underwriting Agreement, dated ______________,
____ (the “Underwriting Agreement”), between the Depositor and the Underwriter.
Capitalized terms not otherwise defined herein shall have the meanings set
forth
in the Pooling and Servicing Agreement.
Reference
is also made to the information provided by ____________ contained in the
Prospectus Supplement, including any supplement or amendment thereto, under
the
caption, “The Originators—______________” and “__________” (the “Company
Information”).
1.
(a)
Company
(also referred to herein as the “Indemnifying Party”) agrees to indemnify and
hold harmless the Underwriter, the Depositor and each of their directors and
officers and affiliates and each person, if any, who controls the Underwriter
or
the Depositor within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act (the “Indemnified Party”), against any and
all actual losses, claims, expenses, damages or liabilities to which the
Depositor or any such director, officer or controlling person may become
subject, under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based
upon (x) any untrue statement of any material fact contained in the Company
Information or omission to state therein, a material fact required to be stated
therein or necessary to make the statements made therein, in light of the
circumstances under which such statements were made, not misleading (in each
case, regardless of whether a final judgment has been entered by a finder of
fact) or (y) any material misstatement or omission contained in the Prospectus
Supplement regarding information or statistics therein regarding the Mortgage
Loans based on information correctly derived by the Depositor or its affiliates
and included in the Prospectus Supplement from information actually provided
to
the Depositor or its affiliates by Company; and will reimburse any such
reasonable legal or other expenses reasonably incurred by the Depositor or
any
such director, officer or controlling person in connection with investigating
or
defending any such loss, claim, damage, liability or action. This indemnity
agreement will be in addition to any liability which Company may otherwise
have.
(b)
Promptly
after receipt by the Indemnified Party under this Section 1 of notice of
the commencement of any action described therein, the Indemnified Party will,
if
a claim in respect thereof is to be made against the Indemnifying Party under
this Section 1, notify the Indemnifying Party of the commencement thereof,
but the omission so to notify the Indemnifying Party will not relieve the
Indemnifying Party from any liability that it may have to the Indemnified Party
(a) under this Agreement except to the extent that the omission to notify the
Indemnifying Party with respect to this Agreement materially adversely affects
the Indemnifying Party’s ability to perform under this Agreement or (b)
otherwise than under this Agreement. In case any such action is brought against
the Indemnified Party, and it notifies the Indemnifying Party of the
commencement thereof, the Indemnifying Party will be entitled to participate
therein, and, to the extent that it may wish to do so, jointly with any other
Indemnifying Party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to the Indemnified Party (who shall not, except
with the consent of the Indemnified Party, be counsel to the Indemnifying
Party), and, after notice from the Indemnifying Party to the Indemnified Party
under this Section 1, the Indemnifying Party shall not be liable for any
legal or other expenses subsequently incurred by the Indemnified Party in
connection with the defense thereof other than reasonable costs of
investigation.
The
Indemnified Party shall have the right to employ separate counsel in any such
action and to participate in the defense thereof, but the fees and expenses
of
such counsel shall be at the expense of the Indemnified Party unless: (i) the
employment thereof has been specifically authorized by the Indemnifying Party
in
writing; (ii) the Indemnified Party shall have been advised by such counsel
that
there may be one or more legal defenses available to it which are different
from
or additional to those available to the Indemnifying Party and in the reasonable
judgment of such counsel it is advisable for the Indemnified Party to employ
separate counsel; (iii) a conflict or potential conflict exists (based on advice
of counsel to the Indemnified Party) between the Indemnified Party and the
Indemnifying Party (in which case the Indemnifying Party will not have the
right
to direct the defense of such action on behalf of the Indemnified Party) or
(iv)
the Indemnifying Party has failed to assume the defense of such action and
employ counsel reasonably satisfactory to the Indemnified Party, in which case,
if the Indemnified Party notifies the Indemnifying Party in writing that it
elects to employ separate counsel at the expense of the Indemnifying Party,
the
Indemnifying Party shall not have the right to assume the defense of such action
on behalf of the Indemnified Party, it being understood, however, the
Indemnifying Party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to local counsel) at any time for the Indemnified Party, which firm
shall be designated in writing by the Depositor or any of the Depositor’s
directors, officers or controlling persons.
The
Indemnified Party, as a condition of the indemnity agreements contained in
Section 1(a) and Section 1(b), shall use its best efforts to cooperate
with the Indemnifying Party in the defense of any such action or claim. The
Indemnifying Party shall not be liable for any settlement of any such action
effected without its written consent (which consent shall not be unreasonably
withheld), but if settled with its written consent or if there be a final
judgment for the plaintiff in any such action, the Indemnifying Party agrees
to
indemnify and hold harmless the Indemnified Party from and against any loss
or
liability (to the extent set forth in Section 1(a) or Section 1(b) as
applicable) by reason of such settlement or judgment.
2.
All
demands, notices and communications hereunder shall be in writing and shall
be
deemed to have been duly given if personally delivered to or mailed by
registered mail, postage prepaid, or transmitted by facsimile and confirmed
by
similar mailed writing as follows: (i) if to Company: ________________, [__],
Attention: [__], and (ii) if to the Depositor:
____________________________________, Facsimile (___) ___-____, Attention:
Legal. Any party hereto may alter the address to which communications or copies
are to be sent by giving notice of such change of address in conformity with
the
provisions of this Section for the giving of notice.
3.
This
Agreement may be executed in any number of counterparts, each of which when
so
executed shall be deemed to be an original, but all of such counterparts shall
together constitute one instrument.
4.
This
Agreement shall be construed in accordance with the laws of the State of New
York.
IN
WITNESS WHEREOF, the Depositor, Underwriter and Company have caused their names
to be signed by their respective officers thereunto duly authorized as of the
date first above written.
|
______________________________________
By:__________________________________
Name:________________________________
Title:_________________________________
|
|
|
______________________________________
By:__________________________________
Name:________________________________
Title:_________________________________
______________________________________
By:__________________________________
Name:________________________________
Title:_________________________________
|
EXHIBIT
12
FORM
OF
BACK-UP CERTIFICATION
I,
[identify certifying individual], certify to the [Purchaser], [Mortgage Loan
Seller] [Depositor], [Trustee], [Securities Administrator] and [Master Servicer]
that:
(i) Based
on
my knowledge, the information in the Annual Statement of Compliance, the Annual
Independent Public Accountant's Servicing Report and all servicing reports,
officer's certificates and other information relating to the servicing of the
Mortgage Loans taken as a whole, does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made,
not
misleading as of the date of this certification;
(ii) The
servicing information required to be provided by the Seller under this Servicing
Agreement has been provided to the Purchaser and the Master
Servicer;
(iii) I
am is
responsible for reviewing the activities performed by the Seller under the
Agreement and based upon the review required by the Agreement, and except as
disclosed in the Annual Statement of Compliance or the Annual Independent Public
Accountant's Servicing Report, the Seller has, as of the date of this
certification fulfilled its obligations under the Agreement; and
(iv) Such
officer has disclosed to the Purchaser and the Master Servicer all significant
deficiencies relating to the Seller’s compliance with the minimum servicing
standards in accordance with a review conducted in compliance with the Uniform
Single Attestation Program for Mortgage Bankers or similar standard as set
forth
in the Servicing Agreement.
|
NEW
CENTURY MORTGAGE CORPORATION
By:
Name:
Title:
Date:
|
EXHIBIT
13
FORM
OF
REMITTANCE REPORT
|
POSTED
DATE
|
|
|
PAYMENT
TYPE
|
|
|
SERVICER
LOAN NBR
|
|
|
INVESTOR
LOAN NUMBER
|
|
|
INVESTOR
ID
|
|
|
ACTION
CODE
|
|
|
ACTUAL
BEG PRIN BAL
|
|
|
ACTUAL
END PRIN BAL
|
|
|
ACTUAL
PRIN AMOUNT
|
|
|
ACUAL
NET INTEREST AMOUNT
|
|
|
P&I
PAYMENT
|
|
|
CURTAILMENT
|
|
|
CURTAILMENT
ADJ
|
|
|
LOAN
LOSS AMOUNT
|
|
|
LOAN
LOSS/LIQUIDATION DATE
|
|
|
NOTE
INT RATE
|
|
|
SERVICE
FEE RATE
|
|
|
NET
INT RATE
|
|
|
NEW
LOAN RATE
|
|
|
PAID
IN FULL PRINCIPAL
|
|
|
PAID
IN FULL INTEREST
|
|
|
PAID
IN FULL DATE
|
|
|
PREPAY
PENALTY AMT
|
|
|
PREPAY
PENALTY WAIVED
|
|
|
NEXT
PAYMENT DUE DATE
|
|
|
PAID
TO DATE
|
|
|
SERVICE
FEE AMOUNT
|
|
|
ESCROW
BALANCE
|
|
EXHIBIT
14
FORM
OF
ANNUAL CERTIFICATION
Re: The
[
]
agreement dated as of
[
l,
200[ ] (the “Agreement”), among [IDENTIFY PARTIES]
I,
_____________________________________, the _______________________ of [NAME
OF
COMPANY] and, in such capacity, the officer in charge of the Company’s
responsibility on Exhibit 15 to the Agreement. I hereby certify to [the
Purchaser], [the Depositor], and the [Master Servicer] [Securities
Administrator] [Trustee], and their officers, with the knowledge and intent
that
they will rely upon this certification, that:
(i) I
have
reviewed the servicer compliance statement of the Company provided in accordance
with Item 1123 of Regulation AB (the “Compliance Statement”), the report on
assessment of the Company’s compliance with the servicing criteria set forth in
Item 1122(d) of Regulation AB (the “Servicing Criteria”), provided in accordance
with Rules 13a-18 and 15d-18 under Securities Exchange Act of 1934, as amended
(the “Exchange Act”) and Item 1122 of Regulation AB (the “Servicing
Assessment”), the registered public accounting firm’s attestation report
provided in accordance with Rules 13a-18 and 15d-18 under the Exchange Act
and
Section 1122(b) of Regulation AB (the “Attestation Report”), and all other data,
servicing reports, officer’s certificates and other information relating to the
performance of the Company under the terms of the Agreement and the servicing
of
the Mortgage Loans by the Company during 200[ ] that were delivered to the
[Depositor] [Master Servicer] [Securities Administrator] [Trustee] pursuant
to
the Agreement (collectively, the “Company Servicing Information”);
(ii) Based
on
my knowledge, the reports and information comprising the Company Servicing
Information, taken as a whole, does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in the light of the circumstances under which such statements were made,
not misleading as of the period covered by, or the date of such reports or
information or the date of this certification;
(iii) Based
on
my knowledge, all of the Company Servicing Information required to be provided
by the Company under the Agreement has been provided to the [Depositor] [Master
Servicer] [Securities Administrator] [Trustee];
(iv) I
am
responsible for reviewing the activities performed by the Company as servicer
under the Agreement, and based on my knowledge and the compliance review
conducted in preparing the Compliance Statement and except as disclosed in
the
Compliance Statement, the Servicing Assessment or the Attestation Report, the
Company has fulfilled its obligations under the Agreement in all material
respects; and
(v) The
Compliance Statement required to be delivered by the Company pursuant to the
Agreement, and the Servicing Assessment and Attestation Report required to
be
provided by the Company and by any Subservicer or Subcontractor pursuant to
the
Agreement, have been provided to the [Depositor] [Master Servicer]. The
Servicing Assessment and the Attestation Report cover all items of the servicing
criteria identified on Exhibit 15 to the Agreement as applicable to the Company.
Any material instances of noncompliance described in such reports have been
disclosed to the [Depositor] [Master Servicer]. Any material instance of
noncompliance with the Servicing Criteria has been disclosed in such
reports.
The
following material instances of noncompliance identified in the Servicing
Assessment and the Attestation Report relate to the performance or obligations
of the Company under the Agreement: ____________ (if none, state
“None.”)
|
Date:
_________________________
|
|
|
By: _______________________________
|
|
|
Name:
|
|
|
Title:
|
|
EXHIBIT
15
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The
assessment of compliance to be delivered by [the Company] [Name of Subservicer]
shall address, at a minimum, the criteria identified as below as “Applicable
Servicing Criteria”:
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
General
Servicing Considerations
|
||
|
1122(d)(1)(i)
|
Policies
and procedures are instituted to monitor any performance or other
triggers
and events of default in accordance with the transaction
agreements.
|
X
|
|
1122(d)(1)(ii)
|
If
any material servicing activities are outsourced to third parties,
policies and procedures are instituted to monitor the third party’s
performance and compliance with such servicing activities.
|
X
|
|
1122(d)(1)(iii)
|
Any
requirements in the transaction agreements to maintain a back-up
servicer
for the mortgage loans are maintained.
|
X
|
|
1122(d)(1)(iv)
|
A
fidelity bond and errors and omissions policy is in effect on the
party
participating in the servicing function throughout the reporting
period in
the amount of coverage required by and otherwise in accordance with
the
terms of the transaction agreements.
|
X
|
|
Cash
Collection and Administration
|
||
|
1122(d)(2)(i)
|
Payments
on mortgage loans are deposited into the appropriate custodial bank
accounts and related bank clearing accounts no more than two business
days
following receipt, or such other number of days specified in the
transaction agreements.
|
X
|
|
1122(d)(2)(ii)
|
Disbursements
made via wire transfer on behalf of an obligor or to an investor
are made
only by authorized personnel.
|
X
|
|
1122(d)(2)(iii)
|
Advances
of funds or guarantees regarding collections, cash flows or distributions,
and any interest or other fees charged for such advances, are made,
reviewed and approved as specified in the transaction
agreements.
|
X
|
|
1122(d)(2)(iv)
|
The
related accounts for the transaction, such as cash reserve accounts
or
accounts established as a form of overcollateralization, are separately
maintained (e.g., with respect to commingling of cash) as set forth
in the
transaction agreements.
|
X
|
|
1122(d)(2)(v)
|
Each
custodial account is maintained at a federally insured depository
institution as set forth in the transaction agreements. For purposes
of
this criterion, “federally insured depository institution” with respect to
a foreign financial institution means a foreign financial institution
that
meets the requirements of Rule 13k-1(b)(1) of the Securities Exchange
Act.
|
X
|
|
1122(d)(2)(vi)
|
Unissued
checks are safeguarded so as to prevent unauthorized
access.
|
X
|
|
1122(d)(2)(vii)
|
Reconciliations
are prepared on a monthly basis for all asset-backed securities related
bank accounts, including custodial accounts and related bank clearing
accounts. These reconciliations are (A) mathematically accurate;
(B)
prepared within 30 calendar days after the bank statement cutoff
date, or
such other number of days specified in the transaction agreements;
(C)
reviewed and approved by someone other than the person who prepared
the
reconciliation; and (D) contain explanations for reconciling items.
These
reconciling items are resolved within 90 calendar days of their original
identification, or such other number of days specified in the transaction
agreements.
|
X
|
|
Investor
Remittances and Reporting
|
||
|
1122(d)(3)(i)
|
Reports
to investors, including those to be filed with the Commission, are
maintained in accordance with the transaction agreements and applicable
Commission requirements. Specifically, such reports (A) are prepared
in
accordance with timeframes and other terms set forth in the transaction
agreements; (B) provide information calculated in accordance with
the
terms specified in the transaction agreements; (C) are filed with
the
Commission as required by its rules and regulations; and (D) agree
with
investors’ or the trustee’s records as to the total unpaid principal
balance and number of mortgage loans serviced by the
Servicer.
|
X
|
|
1122(d)(3)(ii)
|
Amounts
due to investors are allocated and remitted in accordance with timeframes,
distribution priority and other terms set forth in the transaction
agreements.
|
X
|
|
1122(d)(3)(iii)
|
Disbursements
made to an investor are posted within two business days to the Servicer’s
investor records, or such other number of days specified in the
transaction agreements.
|
X
|
|
1122(d)(3)(iv)
|
Amounts
remitted to investors per the investor reports agree with cancelled
checks, or other form of payment, or custodial bank
statements.
|
X
|
|
Pool
Asset Administration
|
||
|
1122(d)(4)(i)
|
Collateral
or security on mortgage loans is maintained as required by the transaction
agreements or related mortgage loan documents.
|
X
|
|
1122(d)(4)(ii)
|
Mortgage
loan and related documents are safeguarded as required by the transaction
agreements.
|
X
|
|
1122(d)(4)(iii)
|
Any
additions, removals or substitutions to the asset pool are made,
reviewed
and approved in accordance with any conditions or requirements in
the
transaction agreements.
|
X
|
|
1122(d)(4)(iv)
|
Payments
on mortgage loans, including any payoffs, made in accordance with
the
related mortgage loan documents are posted to the Servicer’s obligor
records maintained no more than two business days after receipt,
or such
other number of days specified in the transaction agreements, and
allocated to principal, interest or other items (e.g., escrow) in
accordance with the related mortgage loan documents.
|
X
|
|
1122(d)(4)(v)
|
The
Servicer’s records regarding the mortgage loans agree with the Servicer’s
records with respect to an obligor’s unpaid principal
balance.
|
X
|
|
1122(d)(4)(vi)
|
Changes
with respect to the terms or status of an obligor’s mortgage loans (e.g.,
loan modifications or re-agings) are made, reviewed and approved
by
authorized personnel in accordance with the transaction agreements
and
related pool asset documents.
|
X
|
|
1122(d)(4)(vii)
|
Loss
mitigation or recovery actions (e.g., forbearance plans, modifications
and
deeds in lieu of foreclosure, foreclosures and repossessions, as
applicable) are initiated, conducted and concluded in accordance
with the
timeframes or other requirements established by the transaction
agreements.
|
X
|
|
1122(d)(4)(viii)
|
Records
documenting collection efforts are maintained during the period a
mortgage
loan is delinquent in accordance with the transaction agreements.
Such
records are maintained on at least a monthly basis, or such other
period
specified in the transaction agreements, and describe the entity’s
activities in monitoring delinquent mortgage loans including, for
example,
phone calls, letters and payment rescheduling plans in cases where
delinquency is deemed temporary (e.g., illness or
unemployment).
|
X
|
|
1122(d)(4)(ix)
|
Adjustments
to interest rates or rates of return for mortgage loans with variable
rates are computed based on the related mortgage loan
documents.
|
X
|
|
1122(d)(4)(x)
|
Regarding
any funds held in trust for an obligor (such as escrow accounts):
(A) such
funds are analyzed, in accordance with the obligor’s mortgage loan
documents, on at least an annual basis, or such other period specified
in
the transaction agreements; (B) interest on such funds is paid, or
credited, to obligors in accordance with applicable mortgage loan
documents and state laws; and (C) such funds are returned to the
obligor
within 30 calendar days of full repayment of the related mortgage
loans,
or such other number of days specified in the transaction
agreements.
|
X
|
|
1122(d)(4)(xi)
|
Payments
made on behalf of an obligor (such as tax or insurance payments)
are made
on or before the related penalty or expiration dates, as indicated
on the
appropriate bills or notices for such payments, provided that such
support
has been received by the servicer at least 30 calendar days prior
to these
dates, or such other number of days specified in the transaction
agreements.
|
X
|
|
1122(d)(4)(xii)
|
Any
late payment penalties in connection with any payment to be made
on behalf
of an obligor are paid from the servicer’s funds and not charged to the
obligor, unless the late payment was due to the obligor’s error or
omission.
|
X
|
|
1122(d)(4)(xiii)
|
Disbursements
made on behalf of an obligor are posted within two business days
to the
obligor’s records maintained by the servicer, or such other number of days
specified in the transaction agreements.
|
X
|
|
1122(d)(4)(xiv)
|
Delinquencies,
charge-offs and uncollectible accounts are recognized and recorded
in
accordance with the transaction agreements.
|
X
|
|
1122(d)(4)(xv)
|
Any
external enhancement or other support, identified in Item 1114(a)(1)
through (3) or Item 1115 of Regulation AB, is maintained as set forth
in
the transaction agreements.
|
X
|
[NAME
OF
COMPANY] [NAME OF SUBSERVICER]
Date: _________________________
By:
Name:
________________________________
Title:
________________________________
