Exhibit 99.9(c)
SERVICING
AGREEMENT
between
XXXXXX XXXXXXX MORTGAGE CAPITAL INC.
Purchaser
and
INDYMAC BANK, F.S.B.
Servicer
Dated as of September 1, 2006
CONVENTIONAL, ADJUSTABLE AND FIXED RATE RESIDENTIAL MORTGAGE LOANS
TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
Section 1.01 Definitions...................................................................................1
ARTICLE II
SERVICING
Section 2.01 Servicer to Service...........................................................................7
Section 2.02 Liquidation of Mortgage Loans.................................................................9
Section 2.03 Collection of Mortgage Loan Payments.........................................................10
Section 2.04 Establishment of and Deposits to Custodial Account...........................................10
Section 2.05 Permitted Withdrawals From Custodial Account.................................................11
Section 2.06 Establishment of and Deposits to Escrow Account..............................................12
Section 2.07 Permitted Withdrawals From Escrow Account....................................................12
Section 2.08 Payment of Taxes, Insurance and Other Charges; Tax Service Contracts.........................13
Section 2.09 Protection of Accounts.......................................................................14
Section 2.10 Maintenance of Hazard Insurance..............................................................14
Section 2.11 Maintenance of Mortgage Impairment Insurance.................................................15
Section 2.12 Maintenance of Fidelity Bond and Errors and Omissions Insurance..............................16
Section 2.13 Inspections..................................................................................16
Section 2.14 Restoration of Mortgaged Property............................................................17
Section 2.15 Maintenance of PMI Policy; Claims............................................................17
Section 2.16 Title, Management and Disposition of REO Property............................................18
Section 2.17 Permitted Withdrawals with respect to REO Property...........................................19
Section 2.18 Real Estate Owned Reports....................................................................19
Section 2.19 Liquidation Reports..........................................................................19
Section 2.20 Reports of Foreclosures and Abandonments of Mortgaged Property...............................20
ARTICLE III
PAYMENTS TO PURCHASER
Section 3.01 Remittances..................................................................................20
Section 3.02 Statements to Purchaser......................................................................20
Section 3.03 Advances by Servicer.........................................................................21
ARTICLE IV
GENERAL SERVICING PROCEDURES
Section 4.01 Transfers of Mortgaged Property..............................................................21
Section 4.02 Satisfaction of Mortgages and Release of Mortgage Files......................................22
Section 4.03 Servicing Compensation.......................................................................22
Section 4.04 Annual Statement as to Compliance............................................................23
Section 4.05 Annual Independent Public Accountants' Servicing Report......................................23
Section 4.06 Right to Examine Servicer Records............................................................23
Section 4.07 Compliance with Xxxxx-Xxxxx-Xxxxxx Act of 1999...............................................24
ARTICLE V
SERVICER TO COOPERATE
Section 5.01 Provision of Information.....................................................................24
Section 5.02 Financial Statements; Servicing Facilities...................................................24
ARTICLE VI
TERMINATION
Section 6.01 Termination..................................................................................25
Section 6.02 Termination Upon Transfer of Servicing.......................................................25
ARTICLE VII
BOOKS AND RECORDS
Section 7.01 Possession of Servicing Files................................................................26
ARTICLE VIII
INDEMNIFICATION AND ASSIGNMENT
Section 8.01 Indemnification..............................................................................27
Section 8.02 Limitation on Liability of Servicer and Others...............................................27
Section 8.03 Limitation on Resignation and Assignment by Servicer.........................................28
Section 8.04 Assignment by Purchaser......................................................................28
Section 8.05 Merger or Consolidation of the Servicer......................................................28
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ARTICLE IX
REPRNTATIONS, WARRANTIES AND COVENANTS OF PURCHASER
Section 9.01 Authority and Capacity.......................................................................29
ARTICLE X
EPRESENTATIONS AND WARRANTIES OF SERVICER
Section 10.01 Due Organization and Authority...............................................................29
Section 10.02 Ordinary Course of Business..................................................................30
Section 10.03 No Conflicts.................................................................................30
Section 10.04 Ability to Service...........................................................................30
Section 10.05 Ability to Perform...........................................................................30
Section 10.06 No Litigation Pending........................................................................30
Section 10.07 No Consent Required..........................................................................31
Section 10.08 No Untrue Information........................................................................31
Section 10.09 Reasonable Servicing Fee.....................................................................31
ARTICLE XI
DEFAULT
Section 11.01 Events of Default............................................................................31
Section 11.02 Waiver of Defaults...........................................................................33
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01 Notices......................................................................................33
Section 12.02 Waivers......................................................................................34
Section 12.03 Entire Agreement; Amendment..................................................................34
Section 12.04 Execution; Binding Effect....................................................................34
Section 12.05 Headings.....................................................................................34
Section 12.06 Applicable Law...............................................................................34
Section 12.07 Relationship of Parties......................................................................35
Section 12.08 Severability of Provisions...................................................................35
Section 12.09 [Reserved]...................................................................................35
Section 12.10 Exhibits.....................................................................................35
Section 12.11 Counterparts.................................................................................35
Section 12.12 No Solicitation..............................................................................35
Section 12.13 Cooperation of Servicer with a Reconstitution................................................36
Section 12.14 Waiver of Trial by Jury......................................................................37
Section 12.15 Submission To Jurisdiction; Waivers..........................................................38
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ARTICLE XIII
COMPLIANCE WITH REGULATION AB PROVISIONS
Section 13.01 Intent of the Parties; Reasonableness........................................................38
Section 13.02 Additional Representations and Warranties of the Servicer....................................39
Section 13.03 Information to Be Provided by the Servicer...................................................40
Section 13.04 Servicer Compliance Statement................................................................43
Section 13.05 Report on Assessment of Compliance and Attestation...........................................43
Section 13.06 Use of Subservicers and Subcontractors.......................................................44
Section 13.07 Indemnification; Remedies....................................................................45
EXHIBITS
--------
EXHIBIT 1 FORM OF REMITTANCE REPORT
EXHIBIT 2 FORM OF CUSTODIAL ACCOUNT CERTIFICATION
EXHIBIT 3 FORM OF CUSTODIAL ACCOUNT LETTER AGREEMENT
EXHIBIT 4 FORM OF ESCROW ACCOUNT CERTIFICATION
EXHIBIT 5 FORM OF ESCROW ACCOUNT LETTER AGREEMENT
EXHIBIT 6 [RESERVED]
EXHIBIT 7 ANNUAL CERTIFICATIONS
EXHIBIT 8 SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
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SERVICING AGREEMENT
-------------------
This Servicing Agreement ("Servicing Agreement" or "Agreement") is
entered into as of September 1, 2006, by and between INDYMAC BANK, F.S.B., a
federal savings bank (the "Servicer"), and XXXXXX XXXXXXX MORTGAGE CAPITAL
INC., a New York corporation (the "Purchaser").
WHEREAS, the Purchaser and IndyMac Bank, F.S.B., as seller (the
"Seller") entered into a Mortgage Loan Purchase and Warranties Agreement,
dated as of September 1, 2006 (the "Purchase Agreement") pursuant to which the
Purchaser agreed to purchase from the Seller certain conventional, fixed and
adjustable rate, first lien, residential mortgage loans (the "Mortgage Loans")
to be delivered as whole loans on a servicing retained basis; and
WHEREAS, the Purchaser desires to have the Servicer service the
Mortgage Loans, the Servicer desires to service and administer the Mortgage
Loans on behalf of the Purchaser, and the parties desire to provide the terms
and conditions of such servicing by the Servicer.
NOW, THEREFORE, in consideration of the mutual promises and
agreements set forth herein and for other good and valuable consideration, the
receipt and the sufficiency of which are hereby acknowledged, the parties
hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. All capitalized terms not otherwise
defined herein have the respective meanings set forth in the Purchase
Agreement. The following terms are defined as follows:
Accepted Servicing Practices: With respect to any Mortgage Loan,
those mortgage servicing practices of prudent mortgage lending institutions
which service mortgage loans of the same type as such Mortgage Loan in the
jurisdiction where the related Mortgaged Property is located and incorporating
the Delinquency Collection Policies and Procedures.
Ancillary Income: All late charges, assumption fees, escrow
account benefits, reinstatement fees, and similar types of fees arising from
or in connection with any Mortgage Loan to the extent not otherwise payable to
the Mortgagor under applicable law or pursuant to the terms of the related
Mortgage Note.
Closing Date: Shall have the meaning set forth in the applicable
Purchase Price and Terms Agreement.
Condemnation Proceeds: All awards or settlements in respect of a
Mortgaged Property, whether permanent or temporary, partial or entire, by
exercise of the power of eminent
domain or condemnation, to the extent not required to be released to a
Mortgagor in accordance with the terms of the related Mortgage Loan Documents.
Co-op Lease: With respect to a Co-op Loan, the lease with respect
to a dwelling unit occupied by the Mortgagor and relating to the stock
allocated to the related dwelling unit.
Co-op Loan: A Mortgage Loan secured by the pledge of stock
allocated to a dwelling unit in a residential cooperative housing corporation
and a collateral assignment of the related Co-op Lease.
Custodial Account: The separate account or accounts created and
maintained pursuant to Section 2.04.
Cut-off Date: Shall have the meaning set forth in the applicable
Purchase Price and Terms Agreement.
Delinquency Collection Policies and Procedures: The delinquency
collection policies and procedures of the Servicer.
Depositor: The depositor, as such term is defined in Regulation
AB, with respect to any Securitization Transaction.
Determination Date: The 15th day (or if such 15th day is not a
Business Day, the Business Day immediately preceding such 15th day) of the
month of the related Remittance Date.
Errors and Omissions Insurance Policy: An errors and omissions
insurance policy to be maintained by the Servicer pursuant to Section 2.12.
Escrow Account: The separate account or accounts created and
maintained pursuant to Section 2.06.
Escrow Payment: With respect to any Mortgage Loan, the amounts
constituting ground rents, taxes, assessments, water rates, sewer rents,
municipal charges, mortgage insurance premiums, fire and hazard insurance
premiums, condominium charges, and any other payments required to be escrowed
by the Mortgagor with the mortgagee pursuant to the Mortgage or any other
document.
Event of Default: Any one of the conditions or circumstances
enumerated in Section 11.01.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Fidelity Bond: A fidelity bond to be maintained by the Servicer
pursuant to Section 2.12.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds
of insurance policies insuring the Mortgage Loan or the related Mortgaged
Property.
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Liquidation Proceeds: Cash received in connection with the
liquidation of a defaulted Mortgage Loan, whether through the sale or
assignment of such Mortgage Loan, trustee's sale, foreclosure sale or
otherwise, or the sale of the related Mortgaged Property if the Mortgaged
Property is acquired in satisfaction of the Mortgage Loan.
Mortgage: With respect to a Mortgage Loan that is not a Co-op
Loan, the mortgage, deed of trust or other instrument securing a Mortgage
Note, which creates a first lien on an unsubordinated estate in fee simple in
real property securing the Mortgage Note; except that with respect to real
property located in jurisdictions in which the use of leasehold estates for
residential properties is a widely-accepted practice, the mortgage, deed of
trust or other instrument securing the Mortgage Note may secure and create a
first lien upon a leasehold estate of the Mortgagor. With respect to a Co-op
Loan, the Security Agreement.
Mortgage Impairment Insurance Policy: A mortgage impairment or
blanket hazard insurance policy as described in Section 2.11.
Mortgage Loan Remittance Rate: With respect to each Mortgage Loan,
the annual rate of interest remitted to the Purchaser, which shall be equal to
the Mortgage Interest Rate minus the Servicing Fee Rate.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
Mortgagor: The obligor on a Mortgage Note.
Officer's Certificate: A certificate signed by the Chairman of the
Board or the Vice Chairman of the Board or a President or Vice President and
by the Treasurer or the Secretary or one of the Assistant Treasurers or
Assistant Secretaries of the Servicer, and delivered to the Purchaser.
PMI Policy or Primary Insurance Policy: A policy of primary
mortgage guaranty insurance issued by a Qualified Insurer, as required by this
Agreement with respect to certain Mortgage Loans.
Prime Rate: The prime rate announced to be in effect from time to
time, as published as the average rate in The Wall Street Journal (Northeast
edition).
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 penalty or premium thereon and 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.
Principal Prepayment Period: The month preceding the month in
which the related Remittance Date occurs.
Purchase Agreement: The Mortgage Loan Purchase and Warranties
Agreement, dated as of September 1, 2006, between the Purchaser and the
Seller.
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Purchase Price and Terms Agreement: With respect to each pool of
Mortgage Loans purchased pursuant to the Purchase Agreement the related
agreement setting forth the general terms and conditions of the purchase
transaction and identifying the Mortgage Loans to be purchased thereunder, by
and between the Seller and the Purchaser.
Purchaser: As defined in the Recitals.
Qualified Depository: A depository the accounts of which are
insured by the FDIC through the BIF or the SAIF.
Qualified Insurer: An insurance company duly qualified as such
under the laws of the states in which the Mortgaged Properties are located,
duly authorized and licensed in such states to transact the applicable
insurance business and to write the insurance provided, approved as an insurer
by Xxxxxx Mae and Xxxxxxx Mac (or such other rating as may be required by a
Rating Agency in connection with a Securitization Transaction in order to
achieve the desired ratings for the securities to be issued in connection with
such Securitization Transaction).
Reconstitution: Any Securitization Transaction or Whole Loan
Transfer.
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.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.
Remittance Date: The 18th day (or if such 18th day is not a
Business Day, the first Business Day immediately preceding such 18th day) of
any month, beginning with the first Remittance Date after the Closing Date.
Remittance Report: As defined in Section 3.02.
REO Property: A Mortgaged Property acquired by the Servicer on
behalf of the Purchaser through foreclosure or by deed in lieu of foreclosure,
as described in Section 2.16.
Reporting Date: As defined in Section 3.02.
Repurchase Price: As defined in the Purchase Agreement.
SAIF: The Savings Association Insurance Fund, or any successor
thereto.
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
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portfolios of residential mortgage loans consisting, in whole or in part, of
some or all of the Mortgage Loans.
Security Agreement: The agreement creating a security interest in
the stock allocated to a dwelling unit in the residential cooperative housing
corporation that was pledged to secure such Co-op Loan and the related Co-op
Lease.
Seller: As defined in the Recitals.
Servicer: As defined in the Recitals.
Servicer Employees: As defined in Section 2.12.
Servicer Information: As defined in Section 13.07(a).
Servicing Advances: All customary, reasonable and necessary "out
of pocket" costs and expenses (including reasonable attorneys' fees and
disbursements) incurred in the performance by the Servicer of its servicing
obligations, including, but not limited to, the cost of (a) the preservation,
restoration and protection of the Mortgaged Property, (b) any enforcement,
administrative or judicial proceedings, or any legal work or advice
specifically related to servicing the Mortgage Loans, including but not
limited to, foreclosures, bankruptcies, condemnations, drug seizures,
foreclosures by subordinate or superior lienholders, and other legal actions
incidental to the servicing of the Mortgage Loans (provided that such expenses
are reasonable and that the Servicer specifies the Mortgage Loan(s) to which
such expenses relate), (c) the management and liquidation of the Mortgaged
Property if the Mortgaged Property is acquired in satisfaction of the
Mortgage, (d) taxes, assessments, water rates, sewer rates and other charges
which are or may become a lien upon the Mortgaged Property, and PMI Policy
premiums and fire and hazard insurance coverage, (e) any losses sustained by
the Servicer with respect to the liquidation of the Mortgaged Property and (f)
compliance with the obligations under Section 2.08 (except with respect to any
expenses incurred in connection with procuring or transferring Tax Service
Contracts as provided therein).
Servicing Agreement: This agreement between the Purchaser and the
Servicer for the servicing and administration of the Mortgage Loans.
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 subject to this
Agreement, an amount equal to one-twelfth of the product of (a) the Servicing
Fee Rate and (b) the outstanding principal balance of such Mortgage Loan
payable monthly. Such fee shall be payable monthly and shall be pro-rated for
any portion of a month during which the Mortgage Loan is serviced by the
Servicer under this Agreement. The obligation of the Purchaser to pay the
Servicing Fee is limited to, and the Servicing Fee is payable solely from, the
interest portion (including recoveries with respect to interest from
Liquidation Proceeds, to the extent permitted by Section 4.03) of such Monthly
Payment collected by the Servicer, or as otherwise provided under Section
4.03.
5
Servicing Fee Rate: 37.5 basis points (0.375%) per annum.
Servicing File: With respect to each Mortgage Loan, the file
retained by the Servicer, during the period in which the Servicer is acting as
servicer pursuant to the Servicing Agreement, consisting of originals of all
documents in the Mortgage File which are not delivered to the Custodian and
copies of the Mortgage Loan Documents listed on Exhibit A to the Purchase
Agreement.
Servicing Officer: Any officer of the Servicer involved in or
responsible for, the administration and servicing of the Mortgage Loans whose
name appears on a list of servicing officers furnished by the Servicer to the
Purchaser upon request, as such list may from time to time be amended.
Servicing Rights: Any and all of the following: (a) any and all
rights to service the Mortgage Loans; (b) any payments to or monies received
by the Servicer for servicing the Mortgage Loans; (c) any late fees, penalties
or similar payments (excluding any prepayment penalties) with respect to the
Mortgage Loans; (d) all agreements or documents creating, defining or
evidencing any such servicing rights to the extent they relate to such
servicing rights and all rights of the Servicer thereunder; (e) Escrow
Payments or other similar payments with respect to the Mortgage Loans and any
amounts actually collected by the Servicer with respect thereto; (f) all
accounts and other rights to payment related to any of the property described
in this paragraph; and (g) any and all documents, files, records, servicing
files, servicing documents, servicing records, data tapes, computer records,
or other information pertaining to the Mortgage Loans or pertaining to the
past, present or prospective servicing of the Mortgage Loans.
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 Company or a Subservicer.
Subservicer: Any Person that services Mortgage Loans on behalf of
the Servicer 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
Servicer under this Agreement or any Reconstitution Agreement that are
identified in Item 1122(d) of Regulation AB.
Tax Service Contract: A paid-in-full, life-of-loan tax service
contract as described in Section 2.08 hereof.
Whole Loan Transfer: Any sale or transfer of some or all of the
Mortgage Loans, other than a Securitization Transaction.
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ARTICLE II
SERVICING
Section 2.01 Servicer to Service. (a) From and after the Closing
Date, the Servicer, as an independent contractor, shall service and administer
each Mortgage Loan and shall have full power and authority, acting alone, to
do any and all things in connection with such servicing and administration
which the Servicer may deem necessary or desirable, consistent with the terms
of this Agreement and with Accepted Servicing Practices. Except as set forth
in this Agreement, the Originator shall service the Mortgage Loans on an
"scheduled/scheduled" basis and in strict compliance with Accepted Servicing
Practices.
Consistent with the terms of this Agreement, the 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 Servicer's reasonable and prudent
determination such waiver, modification, postponement or indulgence is not
materially adverse to the Purchaser, provided, however, that unless the
Servicer has obtained the prior written consent of the Purchaser, the Servicer
shall not permit any modification with respect to any Mortgage Loan that would
change the Mortgage Interest Rate, defer or forgive the payment of principal,
interest or prepayment penalties (unless the Servicer returns the prepayment
penalties as indicated in the related Purchase Price and Terms Agreement or
unless the Servicer waives such prepayment penalty because it is mandated by
applicable law or the Servicer does so in its own discretion and remits from
the Servicer's own funds, without the right to reimbursement therefore, the
amount of the waived prepayment penalty to the Purchaser or its successors and
assigns), reduce or increase the outstanding principal balance (except for
actual payments of principal) or change the final maturity date on such
Mortgage Loan. Without limiting the generality of the foregoing, the 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 Properties. If reasonably required by the Servicer, the
Purchaser shall furnish the Servicer with any powers of attorney and other
documents necessary or appropriate to enable the Servicer to carry out its
servicing and administrative duties under this Agreement.
In servicing and administering the Mortgage Loans, the 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 Servicing Practices where such practices do not conflict with the
requirements of this Agreement, and the Purchaser's reliance on the Servicer.
In addition, the Servicer shall retain adequate personnel to effect such
servicing and administration of the Mortgage Loans.
The Servicer shall keep at its servicing office books and records
in which, subject to such reasonable regulations as it may prescribe, the
Servicer shall note transfers of Mortgage Loans. No transfer of a Mortgage
Loan may be made unless such transfer is in compliance with
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the terms hereof. For the purposes of this Agreement, Servicer shall be under
no obligation to deal with any Person with respect to this Agreement or the
Mortgage Loans unless the Servicer has been notified of such transfers as
provided in this Section 2.01. The Purchaser may sell and transfer, in whole
or in part, the Mortgage Loans, provided that no such sale and transfer shall
be binding upon Servicer unless such transferee shall agree in writing to be
bound by the terms of this Agreement and the Purchase Agreement, and an
executed copy of the same shall have been delivered to the Servicer. Upon
receipt of notice of such transfer, the Servicer shall xxxx its books and
records to reflect the ownership of the Mortgage Loans by such assignee, and
the previous Purchaser shall be released from its obligations hereunder. This
Agreement shall be binding upon and inure to the benefit of the Purchaser and
the Servicer and their permitted successors, assignees and designees.
The Servicing File retained by the Servicer pursuant to this
Agreement shall be appropriately marked and identified in the Servicer's
computer system to clearly reflect the sale of the related Mortgage Loan to
the Purchaser. The Servicer shall release from its custody the contents of any
Servicing File retained by it only in accordance with this Agreement, except
when such release is required in connection with a repurchase of any such
Mortgage Loan pursuant to Section 9 of the Purchase Agreement.
The Servicer shall forward to the Custodian or, at the request of
the Purchaser, to the Purchaser or its designee, 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 Servicer 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 days of its submission for recordation.
In the event that such original or copy of any document submitted
for recordation to the appropriate public recording office is not so delivered
to the Custodian within 120 days of its submission for recordation, and in the
event that the Seller does not cure such failure within 30 days of discovery
or receipt of written notification of such failure from the Purchaser, the
related Mortgage Loan shall, upon the request of the Purchaser, be repurchased
by the Seller at the price and in the manner specified in Section 9 of the
Purchase Agreement. The foregoing repurchase obligation shall not apply in the
event that the Seller cannot deliver such original or copy of any document
submitted for recordation to the appropriate public recording office within
the specified period due to a delay caused by the recording office in the
applicable jurisdiction; provided that the Seller shall instead deliver an
Officer's Certificate of a servicing officer of the Seller, confirming that
all such documents have been accepted for recording; provided that, upon
request of the Purchaser and delivery by the Purchaser to the Seller of a
schedule of the related Mortgage Loans, the Seller shall reissue and deliver
to the Purchaser or its designee said officer's certificate relating to the
related Mortgage Loans.
The Servicer must 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 its
loan production and the servicing activities of the Servicer. The program is
8
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.
(b) In addition to the Servicer's servicing obligations as set forth
herein, the Servicer shall not consent to the placement of a lien on the
Mortgaged Property senior to that of the related Mortgage.
Section 2.02 Liquidation of Mortgage Loans
In the event that any payment due under any Mortgage Loan and not
postponed pursuant to Section 2.01 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 Servicer shall take such action as (1) the
Servicer would take under similar circumstances with respect to a similar
mortgage loan held for its own account for investment, (2) shall be consistent
with Accepted Servicing Practices, (3) the Servicer shall determine prudently
to be in the best interest of Purchaser, and (4) is consistent with any
related PMI Policy. Therefore, in connection therewith, the Servicer shall
strictly comply with Accepted Servicing Practices. In the event that any
payment due under any Mortgage Loan is not postponed pursuant to Section 2.01
and remains delinquent for a period of 60 days or any other default continues
for a period of 60 days beyond the expiration of any grace or cure period (or
such other period as is required by law in the jurisdiction where the related
Mortgaged Property is located), the Servicer shall commence foreclosure
proceedings in accordance with the Delinquency Collection Policies and
Procedures. In such connection, the Servicer shall from its own funds make all
necessary and proper Servicing Advances, provided, however, that the Servicer
shall not be required to expend its own funds in connection with any
foreclosure or towards the restoration or preservation of any Mortgaged
Property, unless it shall determine (a) that such preservation, restoration
and/or foreclosure will increase the proceeds of liquidation of the Mortgage
Loan to Purchaser after reimbursement to itself for such expenses and (b) that
such expenses will be recoverable by it either through Liquidation Proceeds
(respecting which it shall have priority for purposes of withdrawals from the
Custodial Account pursuant to Section 2.05) or through Insurance Proceeds
(respecting which it shall have similar priority).
Notwithstanding anything to the contrary contained herein, in
connection with a foreclosure, in the event the Servicer has reasonable cause
to believe that a Mortgaged Property is contaminated by hazardous or toxic
substances or wastes, or if the Purchaser otherwise requests an environmental
inspection or review of such Mortgaged Property to be conducted by a qualified
inspector the Servicer shall cause the Mortgaged Property to be so inspected.
Upon completion of the inspection, the Servicer shall promptly provide the
Purchaser with a written report of the environmental inspection.
After reviewing the environmental inspection report, the Purchaser
shall determine how the Servicer shall proceed with respect to the Mortgaged
Property. In the event (a) the environmental inspection report indicates that
the Mortgaged Property is contaminated by hazardous or toxic substances or
wastes and (b) the Purchaser directs the Servicer to proceed
9
with foreclosure or acceptance of a deed in lieu of foreclosure, the Servicer
shall be reimbursed for all reasonable costs associated with such foreclosure
or acceptance of a deed in lieu of foreclosure and any related environmental
clean up costs, as applicable, from the related Liquidation Proceeds, or if
the Liquidation Proceeds are insufficient to fully reimburse the Servicer, the
Servicer shall be entitled to be reimbursed from amounts in the Custodial
Account pursuant to Section 2.05 hereof. In the event the Purchaser directs
the Servicer not to proceed with foreclosure or acceptance of a deed in lieu
of foreclosure, the Servicer shall be reimbursed for all Servicing Advances
made with respect to the related Mortgaged Property from the Custodial Account
pursuant to Section 2.05 hereof.
Section 2.03 Collection of Mortgage Loan Payments.
Following the Closing Date the Servicer shall proceed diligently
to collect all payments due under each of the related Mortgage Loans when the
same shall become due and payable and shall take special care in ascertaining
and estimating Escrow Payments and all other charges that will become due and
payable with respect to the Mortgage Loans and each related Mortgaged
Property, 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.
Section 2.04 Establishment of and Deposits to Custodial Account.
The Servicer shall segregate and hold all funds collected and
received pursuant to the Mortgage Loans separate and apart from any of its own
funds and general assets and shall establish one or more Custodial Accounts,
to be maintained under the sole dominion and control of the Purchaser and
titled "IndyMac Bank, F.S.B. in trust for Xxxxxx Xxxxxxx Mortgage Capital
Inc., owner of Conventional Fixed Rate Residential Mortgage Loans, and various
Mortgagors". The Custodial Account shall be established with a Qualified
Depository acceptable to the Purchaser. Any funds deposited in the Custodial
Account shall at all times be fully insured to the full extent permitted under
applicable law. The creation of any Custodial Account shall be evidenced by a
certification in the form of Exhibit 2 hereto, in the case of an account
established with the Servicer, or by a letter agreement in the form of Exhibit
3 hereto, in the case of an account held by a depository other than the
Servicer. A copy of such certification or letter agreement shall be furnished
to the Purchaser and, upon request, to any subsequent Purchaser.
The Servicer shall deposit in the Custodial Account on a daily
basis on the Business Day following receipt thereof, the following collections
received by the Servicer and payments made by the Servicer after the Cut-off
Date, other than payments of principal and interest due on or before the
Cut-off Date, or received by the Servicer prior to the Cut-off Date but
allocable to a period subsequent thereto:
(i) all payments on account of principal on the Mortgage Loans,
including all Principal Prepayments;
(ii) all payments on account of interest on the Mortgage;
(iii) all Liquidation Proceeds and any amount received with
respect to REO Property;
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(iv) all Insurance Proceeds including amounts required to be deposited
pursuant to Section 2.10 (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 Section 2.14), Section 2.11 and Section
2.15;
(v) all Condemnation Proceeds which are not applied to the
restoration or repair of the Mortgaged Property or released to the Mortgagor
in accordance with Section 2.14;
(vi) any amount required to be deposited in the Custodial Account
pursuant to Section 2.01, 2.09, 2.16, 3.01, 4.01 or 4.02;
(vii) any amounts payable in connection with the repurchase of any
Mortgage Loan pursuant to Section 9 of the Purchase Agreement;
(viii) any prepayment penalties received with respect to any
Mortgage Loan or payable by the Servicer pursuant to Section 2.01 (unless the
related Purchase Price and Terms Agreement indicates otherwise);
(ix) any amounts required to be deposited by the Servicer pursuant
to Section 2.11 in connection with the deductible clause in any blanket hazard
insurance policy; and
(x) with respect to each Principal Prepayment an amount (to be
paid by the Servicer out of its funds) which, when added to all amounts
allocable to interest received in connection with the Principal Prepayment,
equals one month's interest on the amount of principal so prepaid at the
Mortgage Loan Remittance Rate.
The foregoing requirements for deposit into the Custodial Account
shall be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, unless otherwise provided herein, Ancillary
Income need not be deposited by the Servicer into the Custodial Account. Any
interest paid on funds deposited in the Custodial Account by the depository
institution shall accrue to the benefit of the Servicer and the Servicer shall
be entitled to retain and withdraw such interest from the Custodial Account
pursuant to Section 2.05.
Section 2.05 Permitted Withdrawals From Custodial Account.
Subject to Section 3.01, on each Remittance Date, the Servicer
shall be entitled to funds from the Custodial Account for the following
purposes:
(i) to pay to itself the Servicing Fee;
(ii) to reimburse itself for unreimbursed Servicing Advances
(except to the extent reimbursed pursuant to Section 2.07), any accrued but
unpaid Servicing Fees and for unreimbursed advances of Servicer funds made
pursuant to Sections 2.16 or 3.03, the 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 Servicer from the
Mortgagor or otherwise relating to the Mortgage Loan, it being understood
that, in the case of any such reimbursement, the Servicer's right thereto
shall be prior to the rights of the Purchaser except that, where the Seller
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is required to repurchase a Mortgage Loan pursuant to Section 9 of the
Purchase Agreement or Section 4.02 of this Agreement, the Servicer's right to
such reimbursement shall be subsequent to the payment to the Purchaser of the
Repurchase Price pursuant to such sections and all other amounts required to
be paid to the Purchaser with respect to such Mortgage Loan;
(iii) to pay itself any interest earned on funds deposited in the
Custodial Account (all such interest to be withdrawn monthly not later than
each Remittance Date); and
(iv) to clear and terminate the Custodial Account upon the
termination of this Agreement.
Section 2.06 Establishment of and Deposits to Escrow Account. The
Servicer shall segregate and hold all funds collected and received pursuant to a
Mortgage Loan constituting 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, titled, "IndyMac Bank,
F.S.B., as servicer, in trust for Xxxxxx Xxxxxxx Mortgage Capital Inc., owner of
Conventional Fixed Rate Residential Mortgage Loans, and various Mortgagors". The
Escrow Account shall be established with a Qualified Depository, in a manner
which shall provide maximum available insurance thereunder. Funds deposited in
the Escrow Accounts may be drawn on by the Servicer in accordance with Section
2.07. The creation of any Escrow Account shall be evidenced by a certification
in the form of Exhibit 4 hereto, in the case of an account established with the
Servicer, or by a letter agreement in the form of Exhibit 5 hereto, in the case
of an account held by a depository other than the Servicer. A copy of such
certification shall be furnished to the Purchaser and, upon request, to any
subsequent Purchaser.
The 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 amounts representing Insurance Proceeds or Condemnation
Proceeds which are to be applied to the restoration or repair of any Mortgaged
Property.
The Servicer shall make withdrawals from the Escrow Account only
to effect such payments as are required under this Agreement, as set forth in
Section 2.07. The 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.
To the extent required by law, the Servicer shall pay from its own funds
interest on escrowed funds to the Mortgagor notwithstanding that the Escrow
Account may be non-interest bearing or that interest paid thereon is
insufficient for such purposes.
Section 2.07 Permitted Withdrawals From Escrow Account.
Withdrawals from the Escrow Account or Accounts may be made by the
Servicer only:
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(i) to effect timely payments of ground rents, taxes, assessments,
water rates, mortgage insurance premiums, condominium charges, fire and hazard
insurance premiums or other items constituting Escrow Payments for the related
Mortgage;
(ii) to reimburse itself for any Servicing Advance relating to
taxes, assessments, water rates, sewer rates and other charges which are or
may become a lien upon the Mortgaged Property, and PMI Policy premiums and
fire and hazard insurance coverage made by the Servicer with respect to a
related Mortgage Loan (except with respect to any expenses incurred in
procuring or transferring Tax Service Contracts pursuant to Section 2.08), but
only from amounts received on the related Mortgage Loan which represent late
collections of Escrow Payments thereunder;
(iii) to refund to any Mortgagor any funds found to be in excess
of the amounts required under the terms of the related Mortgage Loan or
applicable federal or state law or judicial or administrative ruling;
(iv) for transfer to the Custodial Account and application to
reduce the principal balance of the Mortgage Loan in accordance with the terms
of the related Mortgage and Mortgage Note;
(v) for application to restoration or repair of the Mortgaged
Property in accordance with the procedures outlined in Section 2.14;
(vi) to pay to the Servicer, or any Mortgagor to the extent
required by law, any interest paid on the funds deposited in the Escrow
Account; and
(vii) to clear and terminate the Escrow Account on the termination
of this Agreement.
Section 2.08 Payment of Taxes, Insurance and Other Charges; Tax
Service Contracts.
With respect to each Mortgage Loan, the Servicer shall maintain
accurate records reflecting the status of ground rents, taxes, assessments,
water rates, sewer rents, and other charges which are or may become a lien
upon the Mortgaged Property and the status of PMI Policy premiums and fire and
hazard insurance coverage and shall obtain, from time to time, all bills for
the payment of such charges (including renewal premiums) and shall effect
payment thereof prior to the applicable penalty or termination date, employing
for such purpose deposits of the Mortgagor in the Escrow Account which shall
have been estimated and accumulated by the Servicer in amounts sufficient for
such purposes, as allowed under the terms of the Mortgage. To the extent that
a Mortgage does not provide for Escrow Payments, the Servicer shall determine
whether any such payments are made by the Mortgagor at the time they first
become due. The Servicer assumes full responsibility for the payment of all
such bills and shall effect payment of all such charges irrespective of each
Mortgagor's faithful performance in the payment of same or the making of the
Escrow Payments, and the Servicer shall make advances from its own funds to
effect such payments within such time period as will avoid the loss of the
related Mortgaged Property by foreclosure of a tax or other lien.
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The Servicer shall ensure that each of the Mortgage Loans shall be
covered by a Tax Service Contract which shall be assigned to the Purchaser or
the Purchaser's designee at the Servicer's expense in the event that the
Servicer is no longer the servicer of the related Mortgage Loan(s) hereunder.
To the extent that a Mortgage Loan does not have a Tax Service Contract, the
Servicer shall pay to a tax service vendor the appropriate fee to obtain
coverage.
Section 2.09 Protection of Accounts.
The Servicer may transfer the Escrow Account to a different
Qualified Depository from time to time. Such transfer shall be made only upon
obtaining the consent of the Purchaser, which consent shall not be withheld
unreasonably.
The Servicer shall bear any expenses, losses or damages sustained
by the Purchaser because the Escrow Account are not demand deposit accounts.
Section 2.10 Maintenance of Hazard Insurance.
The Servicer shall cause to be maintained for each Mortgage Loan,
hazard insurance such that all buildings upon the Mortgaged Property are
insured by a generally acceptable insurer rated as described in the
Underwriting Guidelines against loss by fire, hazards of extended coverage and
such other hazards as are required to be insured pursuant to Accepted
Servicing Practices, in an amount which is at least equal to the lesser of (i)
the maximum insurable value of the improvements securing such Mortgage Loan
and (ii) the greater of (a) the aggregate unpaid principal balance of the
Mortgage Loan and, (b) an amount such that the proceeds thereof shall be
sufficient to prevent the Mortgagor or the loss payee from becoming a
co-insurer.
If required by the National Flood Insurance Act of 1968, as
amended, each Mortgage Loan is, and shall continue to be, covered by a flood
insurance policy meeting the requirements of the current guidelines of the
Federal Insurance Administration is in effect with a generally acceptable
insurance carrier rated as described in the Underwriting Guidelines in an
amount representing coverage not less than the least of (i) the aggregate
unpaid principal balance of the related Mortgage Loan and of any mortgage loan
senior to such Mortgage Loan, (ii) the maximum amount of insurance which is
available under the National Flood Insurance Act of 1968, as amended
(regardless of whether the area in which such Mortgaged Property is located is
participating in such program), and (iii) the full replacement value of the
improvements which are part of such Mortgaged Property. If a Mortgaged
Property is located in a special flood hazard area and is not covered by flood
insurance or is covered in an amount less than the amount required by the
National Flood Insurance Act of 1968, as amended, the Servicer shall notify
the related Mortgagor that the Mortgagor must obtain such flood insurance
coverage, and if said Mortgagor fails to obtain the required flood insurance
coverage within forty five (45) days after such notification, the Servicer
shall immediately force place the required flood insurance on the Mortgagor's
behalf.
If a Mortgage is secured by a unit in a condominium project, the
Servicer shall verify that the coverage required of the owner's association,
including hazard, flood, liability, and fidelity coverage, is being maintained
in accordance with Accepted Servicing Practices, and
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secure from the owner's association its agreement to notify the Servicer
promptly of any change in the insurance coverage or of any condemnation or
casualty loss that may have a material effect on the value of the Mortgaged
Property as security.
The Servicer shall cause to be maintained on each Mortgaged
Property such other or additional insurance as may be required pursuant to
such applicable laws and regulations as shall at any time be in force and as
shall require such additional insurance, or pursuant to the requirements of
any private mortgage guaranty insurer, or as may be required to conform with
Accepted Servicing Practices.
In the event that the Purchaser or the Servicer shall determine
that the Mortgaged Property should be insured against loss or damage by
hazards and risks not covered by the insurance required to be maintained by
the Mortgagor pursuant to the terms of the Mortgage, the Servicer shall
communicate and consult with the Mortgagor with respect to the need for such
insurance and bring to the Mortgagor's attention the desirability of
protection of the Mortgaged Property.
All policies required hereunder shall name the Servicer and its
successors and assigns as a mortgagee and loss payee and shall be endorsed
with non contributory standard or New York mortgagee clauses which shall
provide for at least 30 days prior written notice of any cancellation,
reduction in amount or material change in coverage.
The Servicer shall not interfere with the Mortgagor's freedom of
choice in selecting either his insurance carrier or agent, provided, however,
that the Servicer shall not accept any such insurance policies from insurance
companies unless such companies are as described in the Underwriting
Guidelines and are licensed to do business in the jurisdiction in which the
Mortgaged Property is located. The Servicer shall determine that such policies
provide sufficient risk coverage and amounts as required pursuant to Accepted
Servicing Practices, that they insure the property owner, and that they
properly describe the property address. The Servicer shall furnish to the
Mortgagor a formal notice of expiration of any such insurance in sufficient
time for the Mortgagor to arrange for renewal coverage by the expiration date;
provided, however, that in the event that no such notice is furnished by the
Servicer, the Servicer shall ensure that replacement insurance policies are in
place in the required coverages and the Servicer shall be solely liable for
any losses in the event coverage is not provided.
Pursuant to Section 2.04, any amounts collected by the Servicer
under any such policies (other than amounts to be deposited in the Escrow
Account and applied to the restoration or repair of the related Mortgaged
Property, or property acquired in liquidation of the Mortgage Loan, or to be
released to the Mortgagor, in accordance with the Servicer's normal servicing
procedures as specified in Section 2.14) shall be deposited in the Custodial
Account subject to withdrawal pursuant to Section 2.05.
Section 2.11 Maintenance of Mortgage Impairment Insurance.
In the event that the Servicer shall obtain and maintain a blanket
policy insuring against losses arising from fire and hazards covered under
extended coverage on all of the Mortgage Loans, then, to the extent such
policy provides coverage in an amount equal to the
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amount required pursuant to Section 2.10 and otherwise complies with all other
requirements of Section 2.10, it shall conclusively be deemed to have
satisfied its obligations as set forth in Section 2.10. Any amounts collected
by the Servicer under any such policy relating to a Mortgage Loan shall be
deposited in the Custodial Account subject to withdrawal pursuant to Section
2.05. Such policy may contain a deductible clause, in which case, in the event
that there shall not have been maintained on the related Mortgaged Property a
policy complying with Section 2.10, and there shall have been a loss which
would have been covered by such policy, the Servicer shall deposit in the
Custodial Account at the time of such loss the amount not otherwise payable
under the blanket policy because of such deductible clause, such amount to be
deposited from the Servicer's funds, without reimbursement therefor. Upon
request of the Purchaser, the 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 30 days' prior written notice to the Purchaser.
Section 2.12 Maintenance of Fidelity Bond and Errors and Omissions
Insurance.
The Servicer shall maintain with responsible companies, at its own
expense, a blanket Fidelity Bond and an Errors and Omissions Insurance Policy,
with broad coverage on all officers, employees or other persons acting in any
capacity requiring such persons to handle funds, money, documents or papers
relating to the Mortgage Loans ("Servicer Employees"). Any such Fidelity Bond
and Errors and Omissions Insurance Policy shall be in the form of the Mortgage
Banker's Blanket Bond and shall protect and insure the Servicer against
losses, including forgery, theft, embezzlement, fraud, errors and omissions
and negligent acts of such Servicer Employees. Such Fidelity Bond and Errors
and Omissions Insurance Policy also shall protect and insure the Servicer
against losses in connection with the release or satisfaction of a Mortgage
Loan without having obtained payment in full of the indebtedness secured
thereby. No provision of this Section 2.12 requiring such Fidelity Bond and
Errors and Omissions Insurance Policy shall diminish or relieve the Servicer
from its duties and obligations as set forth in this Agreement. The minimum
coverage under any such Fidelity Bond and Errors and Omissions Insurance
Policy shall be at least equal to the corresponding amounts required by Xxxxxx
Mae in the Xxxxxx Xxx Guides or by Xxxxxxx Mac in the Xxxxxxx Xxx Xxxxxxx' &
Servicers' Guide. Upon the request of the Purchaser, the Servicer shall cause
to be delivered to the Purchaser a certified true copy of such Fidelity Bond
and Errors and Omissions Insurance Policy and a statement from the surety and
the insurer that such Fidelity Bond and Errors and Omissions Insurance Policy
shall in no event be terminated or materially modified without 30 days' prior
written notice to the Purchaser.
Section 2.13 Inspections.
The Servicer shall inspect the Mortgaged Property as often as is
deemed necessary by the Servicer to assure itself that the value of the
Mortgaged Property is being preserved. In addition, if any Mortgage Loan is
more than 45 and less than 60 days delinquent, the Servicer shall inspect the
Mortgaged Property and shall conduct subsequent inspections in accordance with
Accepted Servicing Practices. The Servicer shall keep a written report of each
such inspection.
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Section 2.14 Restoration of Mortgaged Property.
The Servicer need not obtain the approval of the Purchaser prior
to releasing any Insurance Proceeds or Condemnation Proceeds to the Mortgagor
to be applied to the restoration or repair of the Mortgaged Property if such
release is in accordance with Accepted Servicing Practices and the terms of
this Agreement. At a minimum, the Servicer shall comply with the following
conditions in connection with any such release of Insurance Proceeds or
Condemnation Proceeds:
(i) the Servicer shall receive satisfactory independent
verification of completion of repairs and issuance of any required approvals
with respect thereto;
(ii) the Servicer shall take all steps necessary to preserve the
priority of the lien of the Mortgage, including, but not limited to requiring
waivers with respect to mechanics' and materialmen's liens;
(iii) the Servicer shall verify that the Mortgage Loan is not in
default; and
(iv) pending repairs or restoration, the Servicer shall place the
Insurance Proceeds or Condemnation Proceeds in the Escrow Account.
If the Purchaser is named as an additional loss payee, the
Servicer is hereby empowered to endorse any loss draft issued in respect of
such a claim in the name of the Purchaser.
Section 2.15 Maintenance of PMI Policy; Claims.
With respect to each Mortgage Loan covered by a PMI Policy, as set
forth on the Mortgage Loan Schedule, the Servicer shall, without any cost to
the Purchaser, maintain or cause the Mortgagor to maintain in full force and
effect a PMI Policy, and shall pay or shall cause the Mortgagor to pay the
premium thereon on a timely basis, for the term of such Mortgage Loan. In the
event that such PMI Policy shall be terminated, the Servicer shall obtain from
another Qualified Insurer a comparable replacement policy, with a total
coverage equal to the remaining coverage of such terminated PMI Policy. If the
insurer shall cease to be a Qualified Insurer, the Servicer shall determine
whether recoveries under the PMI Policy are jeopardized for reasons related to
the financial condition of such insurer, it being understood that the Servicer
shall in no event have any responsibility or liability for any failure to
recover under the PMI Policy for such reason. If the Servicer determines that
recoveries are so jeopardized, it shall notify the Purchaser and the
Mortgagor, if required, and obtain from another Qualified Insurer a
replacement insurance policy. The Servicer shall not take any action which
would result in noncoverage under any applicable PMI Policy of any loss which,
but for the actions of the Servicer would have been covered thereunder. In
connection with any assumption or substitution agreement entered into or to be
entered into pursuant to Section 4.01, the Servicer shall promptly notify the
insurer under the related PMI Policy, if any, of such assumption or
substitution of liability in accordance with the terms of such PMI Policy and
shall take all actions which may be required by such insurer as a condition to
the continuation of coverage under such PMI Policy. If such PMI Policy is
terminated as a result of such assumption or substitution of liability, the
Servicer shall obtain a replacement PMI Policy as provided above.
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In connection with its activities as servicer, the Servicer agrees
to prepare and present, on behalf of itself and the Purchaser, claims to the
insurer under any PMI Policy in a timely fashion in accordance with the terms
of such PMI Policy and, in this regard, to take such action as shall be
necessary to permit recovery under any PMI Policy respecting a defaulted
Mortgage Loan. Pursuant to Section 2.04, any amounts collected by the Servicer
under any PMI Policy shall be deposited in the Custodial Account, subject to
withdrawal pursuant to Section 2.05.
Section 2.16 Title, Management and Disposition of REO Property.
In the event that title to any 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 Servicer or the Purchaser's designee, on
behalf of the Purchaser, or in the event the Purchaser is not authorized or
permitted to hold title to real property in the state where the REO Property
is located, or would be adversely affected under the "doing business" or tax
laws of such state by so holding title, the deed or certificate of sale shall
be taken in the name of such Person or Persons as shall be consistent with an
Opinion of Counsel obtained by the Servicer from any attorney duly licensed to
practice law in the state where the REO Property is located. The Person or
Persons holding such title other than the Purchaser shall acknowledge in
writing that such title is being held as nominee for the Purchaser.
The Servicer shall manage, conserve, protect and operate each REO
Property for the Purchaser solely for the purpose of its prompt disposition
and sale. The Servicer, either itself or through an agent selected by the
Servicer, shall manage, conserve, protect and operate the REO Property 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. The Servicer shall attempt
to sell the same (and may temporarily rent the same for a period not greater
than one year, except as otherwise provided below) on such terms and
conditions as the Servicer deems to be in the best interest of the Purchaser.
The Servicer shall notify the Purchaser from time to time as to the status of
each REO Property.
The 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
Servicer determines, and gives an appropriate notice to the Purchaser to such
effect, that a longer period is necessary for the orderly liquidation of such
REO Property. If a period longer than one year is permitted under the
foregoing sentence and is necessary to sell any REO Property, (i) the 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 Servicer as mortgagee, and such purchase money
mortgage shall not be held pursuant to this Agreement, but instead a separate
participation agreement among the Servicer and Purchaser shall be entered into
with respect to such purchase money mortgage.
The Servicer shall also maintain on each REO Property fire and
hazard insurance with extended coverage in an amount which is at least equal
to the maximum insurable value of the improvements which are a part of such
property, liability insurance and, to the extent
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required and available under the National Flood Insurance Act of 1968, as
amended, flood insurance in the amount required in Section 2.10 hereof.
The disposition of REO Property shall be carried out by the
Servicer at such price, and upon such terms and conditions, as the Servicer
deems to be in the best interests of the Purchaser. The proceeds of sale of
the REO Property shall be promptly deposited in the Custodial Account. As soon
as practical thereafter the expenses of such sale shall be paid and the
Servicer shall reimburse itself pursuant to Section 2.05(iii) hereof, for any
related unreimbursed Servicing Advances, unpaid Servicing Fees and
unreimbursed advances made pursuant to this Section, and on the Remittance
Date immediately following the Principal Prepayment Period in which such sale
proceeds are received the net cash proceeds of such sale remaining in the
Custodial Account shall be distributed to the Purchaser; provided that such
distribution shall, in any event, be made within ninety (90) days from and
after the closing of the sale of such REO Property.
With respect to each REO Property, the Servicer shall hold all
funds collected and received in connection with the operation of the REO
Property in the Custodial Account. The Servicer shall cause to be deposited on
a daily basis upon the receipt thereof in each Custodial Account all revenues
received with respect to the conservation and disposition of the related REO
Property.
Section 2.17 Permitted Withdrawals with respect to REO Property.
The Servicer shall withdraw funds on deposit in the Custodial
Account with respect to each related REO Property necessary for the proper
operation, management and maintenance of the REO Property, including the cost
of maintaining any hazard insurance pursuant to Section 2.10 and the fees of
any managing agent acting on behalf of the Servicer. The Servicer shall make
monthly distributions on each Remittance Date to the Purchaser of the net cash
flow from the REO Property (which shall equal the revenues from such REO
Property net of the expenses described in Section 2.16 and of any reserves
reasonably required from time to time to be maintained to satisfy anticipated
liabilities for such expenses).
Section 2.18 Real Estate Owned Reports.
Together with the statement furnished pursuant to Section 2.19,
the Servicer shall furnish to the Purchaser on or before the 10th Business Day
of each month a statement with respect to any REO Property covering the
operation of such REO Property for the previous month and the 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. That
statement shall be accompanied by such other information as the Purchaser
shall reasonably request.
Section 2.19 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 Servicer shall submit to the Purchaser a liquidation report
with respect to such Mortgaged Property.
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Section 2.20 Reports of Foreclosures and Abandonments of Mortgaged
Property.
Following the foreclosure sale or abandonment of any Mortgaged
Property, the Servicer shall report such foreclosure or abandonment as
required pursuant to Section 6050J of the Code.
ARTICLE III
PAYMENTS TO PURCHASER
Section 3.01 Remittances.
With respect to each Determination Date, the Servicer shall submit
to the Purchaser the Remittance Report required by Section 3.02 of this
Agreement, setting forth the sources and uses of funds deposited and to be
deposited by the Servicer into the Custodial Account. If such monthly
remittance advice is determined by the Purchaser to be in order, on each
Remittance Date the Servicer shall cause all amounts deposited in the
Custodial Account as of the close of business on the immediately preceding
Determination Date, minus any amounts attributable to Monthly Payments
collected but due on a Due Date or Dates subsequent to the first day of the
month of the Remittance Date (which amounts shall be remitted on the
Remittance Date next succeeding the Due Period for such amounts) to be
remitted as follows: (i) to the Servicer, amounts due to the Servicer pursuant
to Section 2.05, and (ii) to the Purchaser, all funds remaining in the
Custodial Account.
With respect to any funds deposited in the Custodial Account after
the second Business Day following the Business Day on which such deposit was
required to be made, the Servicer shall pay to the Purchaser interest on any
such late payment at an annual rate equal to the Prime Rate, adjusted as of
the date of each change, plus two percentage points, but in no event greater
than the maximum amount permitted by applicable law. Such interest shall be
deposited in the Custodial Account by the Servicer 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
the distribution payable on the next succeeding Remittance Date. The payment
by the Servicer of any such interest shall not be deemed an extension of time
for payment or a waiver of any Event of Default by the Servicer.
Section 3.02 Statements to Purchaser.
Each month, no later than the 10th Business Day (the "Reporting
Date"), the Servicer shall furnish to the Purchaser a remittance report, in
the form of Exhibit 1 hereto (the "Remittance Report"), in electronic format
acceptable to the Purchaser, containing information regarding funds collected
during the prior calendar month.
In addition, not more than 60 days after the end of each calendar
year, commencing with the first December 31 following the Cut-off Date, the
Servicer shall furnish to each Person who was a Purchaser of the Mortgage
Loans at any time during such calendar year
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an annual statement in accordance with the requirements of applicable federal
income tax law as to the aggregate of remittances for the applicable portion
of such year.
Such obligation of the Servicer shall be deemed to have been
satisfied to the extent that substantially comparable information shall be
provided by the Servicer pursuant to any requirements of the Internal Revenue
Code as from time to time are in force.
The Servicer shall provide any and all information necessary for
the preparation and filing of 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.
Section 3.03 Advances by Servicer.
On the Business Day immediately preceding each Remittance Date,
the Servicer shall deposit in the Custodial Account from its own funds an
amount equal to all Monthly Payments which were due on the Mortgage Loans
during the applicable Due Period and which were delinquent at the close of
business on the immediately preceding Determination Date or which were
deferred pursuant to Section 2.01. The Servicer's obligation to make such
advances as to any Mortgage Loan will continue through the earlier to occur of
(a) the last Monthly Payment due prior to the payment in full of the Mortgage
Loan or (b) the last Remittance Date prior to the Remittance Date for the
distribution of all Liquidation Proceeds and other payments or recoveries
(including Insurance Proceeds, and Condemnation Proceeds) with respect to the
Mortgage Loan. To the extent permitted under Section 2.05 hereof, the Servicer
shall be entitled to first priority reimbursement for principal and interest
advances and for Servicing Advances from recoveries from the related Mortgagor
or from all Liquidation Proceeds and other payments or recoveries (including
Insurance Proceeds and Condemnation Proceeds) with respect to the related
Mortgage Loan.
ARTICLE IV
GENERAL SERVICING PROCEDURES
Section 4.01 Transfers of Mortgaged Property.
The Servicer shall be required to enforce any "due-on-sale"
provision contained in any Mortgage or Mortgage Note and to deny assumption by
the person to whom the Mortgaged Property has been or is about to be sold
whether by absolute conveyance or by contract of sale, and whether or not the
Mortgagor remains liable on the Mortgage and the Mortgage Note. When the
Mortgaged Property has been conveyed by the Mortgagor, the Servicer shall, to
the extent it has knowledge of such conveyance, exercise its rights to
accelerate the maturity of such Mortgage Loan under the "due-on-sale" clause
applicable thereto, provided, however, that the Servicer shall not exercise
such rights if prohibited by law from doing so, provided, however, that the
Servicer shall not exercise such rights if prohibited by law from doing so or
if the exercise of such rights would impair or threaten to impair any recovery
under the related PMI Policy, if any.
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If the Servicer reasonably believes it is unable under applicable
law to enforce such "due-on-sale" clause, the Servicer, in the Purchaser's
name, shall, to the extent permitted by applicable law, enter into (i) an
assumption and modification agreement with the person to whom such property
has been conveyed, pursuant to which such person becomes liable under the
Mortgage Note and the original Mortgagor remains liable thereon or (ii) in the
event the Servicer is unable under applicable law to require that the original
Mortgagor remain liable under the Mortgage Note and the Servicer has the prior
consent of the primary mortgage guarantee insurer, a substitution of liability
agreement with the purchaser of the Mortgaged Property pursuant to which the
original Mortgagor is released from liability and the purchaser of the
Mortgaged Property is substituted as Mortgagor and becomes liable under the
Mortgage Note. In connection with any such assumption, neither the Mortgage
Interest Rate borne by the related Mortgage Note, the term of the Mortgage
Loan nor the outstanding principal amount of the Mortgage Loan shall be
changed.
To the extent that any Mortgage Loan is assumable, the Servicer
shall inquire diligently into the creditworthiness of the proposed transferee,
and shall use the Underwriting Guidelines for approving the credit of the
proposed transferee which are used by the Servicer with respect to
underwriting mortgage loans of the same type as the Mortgage Loans. If the
credit of the proposed transferee does not meet the Underwriting Guidelines,
the Servicer diligently shall, to the extent permitted by the Mortgage or the
Mortgage Note and by applicable law, accelerate the maturity of the Mortgage
Loan.
Section 4.02 Satisfaction of Mortgages and Release of Mortgage
Files.
Upon the payment in full of any Mortgage Loan, or the receipt by
the Servicer of a notification that payment in full will be escrowed in a
manner customary for such purposes, the Servicer shall notify the Purchaser in
the Monthly Remittance Advice as provided in Section 3.02, and may request the
release of any Mortgage Loan Documents from the Purchaser in accordance with
this Section 4.02 hereof. The Servicer shall obtain discharge of the related
Mortgage Loan as of record within any related time limit required by
applicable law.
If the Servicer satisfies or releases a Mortgage without first
having obtained payment in full of the indebtedness secured by the Mortgage or
should the Servicer otherwise prejudice any rights the Purchaser may have
under the mortgage instruments, upon written demand of the Purchaser, the
Servicer shall repurchase the related Mortgage Loan at the Repurchase Price by
deposit thereof in the Custodial Account within 2 Business Days of receipt of
such demand by the Purchaser. The Servicer shall maintain the Fidelity Bond
and Errors and Omissions Insurance Policy as provided for in Section 2.12
insuring the Servicer against any loss it may sustain with respect to any
Mortgage Loan not satisfied in accordance with the procedures set forth
herein.
Section 4.03 Servicing Compensation.
As consideration for servicing the Mortgage Loans, the Servicer
shall withdraw the Servicing Fee with respect to each Mortgage Loan from the
Custodial Account pursuant to Section 2.05 hereof. Such Servicing Fee shall be
payable monthly, computed on the basis of the number of Mortgage Loans subject
to this Agreement. The Servicing Fee shall be pro-rated
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when servicing is for less than one month. The obligation of the Purchaser to
pay, and the Servicer's right to withdraw, the Servicing Fee is limited to,
and the Servicing Fee is payable solely from, the interest portion (including
recoveries with respect to interest from Liquidation Proceeds, to the extent
permitted by Section 2.05), of such Monthly Payment collected by the Servicer,
or as otherwise provided under Section 2.05.
Additional servicing compensation in the form of Ancillary Income
shall be retained by the Servicer to the extent not required to be deposited
in the Custodial Account. The 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 thereof except as specifically provided for
herein.
Section 4.04 Annual Statement as to Compliance.
The Servicer shall deliver to the Purchaser, on or before March
10th each year beginning March 10, 2007, and, if applicable, on the related
Transfer Date an Officer's Certificate, stating that (i) a review of the
activities of the Servicer during the preceding calendar year and of
performance under this Agreement has been made under such officer's
supervision, and (ii) the Servicer has complied fully with the provisions of
Article II and Article IV, and (iii) to the best of such officer's knowledge,
based on such review, the Servicer has fulfilled all 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 and the action being taken by the
Servicer to cure such default.
Section 4.05 Annual Independent Public Accountants' Servicing
Report.
As long as any Mortgage Loans are being serviced hereunder, or
were serviced during the prior calendar year on, or before March 10th of each
year beginning March 10, 2007, the Servicer, at its expense, shall cause a
firm of independent public accountants which is a member of the American
Institute of Certified Public Accountants to furnish a statement to each
Purchaser to the effect that such firm has examined certain documents and
records relating to the servicing of the Mortgage Loans and this Agreement and
that such firm is of the opinion that the provisions of Article II and Article
III have been complied with, and that, on the basis of such examination
conducted substantially in compliance with the Uniform Single Attestation
Program for Mortgage Bankers, nothing has come to their attention which would
indicate that such servicing has not been conducted in compliance therewith,
except for such exceptions as such firm shall believe to be immaterial.
Section 4.06 Right to Examine Servicer Records.
The Purchaser shall have the right to examine and audit any and
all of the books, records, or other information of the Servicer, whether held
by the Servicer or by another on its behalf, with respect to or concerning
this Agreement or the Mortgage Loans, during business hours or at such other
times as may be reasonable under applicable circumstances, upon reasonable
advance notice.
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Section 4.07 Compliance with Xxxxx-Xxxxx-Xxxxxx Act of 1999.
With respect to each Mortgage Loan and the related Mortgagor, the
Servicer shall comply with Title V of the Xxxxx-Xxxxx-Xxxxxx Act of 1999, as
amended and all applicable regulations promulgated thereunder, and shall
provide all notices required thereunder.
ARTICLE V
SERVICER TO COOPERATE
Section 5.01 Provision of Information.
During the term of this Agreement, the Servicer shall furnish to
the Purchaser such periodic, special, or other reports or information, whether
or not provided for herein, as shall be necessary, reasonable, or appropriate
with respect to the Purchaser or the purposes of this Agreement. All such
reports or information shall be provided by and in accordance with all
reasonable instructions and directions which the Purchaser may give.
The Servicer shall execute and deliver all such instruments and
take all such action as the Purchaser may reasonably request from time to
time, in order to effectuate the purposes and to carry out the terms of this
Agreement.
Section 5.02 Financial Statements; Servicing Facilities.
In connection with marketing the Mortgage Loans, the Purchaser may
make available to a prospective purchaser audited financial statements of the
corporate group that includes the Servicer for the most recently completed
five fiscal years for which such statements are available, as well as a
Consolidated Statement of Condition at the end of the last two fiscal years
covered by any Consolidated Statement of Operations. The Servicer also shall
make available any comparable interim statements to the extent any such
statements have been prepared by or on behalf of the corporate group that
includes the Servicer (and are available upon request to members or
stockholders of the corporate group that includes the Servicer or to the
public at large). The Servicer shall furnish promptly to the Purchaser or a
prospective purchaser copies of the statements specified above.
The Servicer shall make available to the Purchaser or any
prospective Purchaser a knowledgeable financial or accounting officer for the
purpose of answering questions respecting recent developments affecting the
Servicer or the financial statements of the corporate group that includes the
Servicer, and to permit any prospective purchaser to inspect the Servicer's
servicing facilities for the purpose of satisfying such prospective purchaser
that the Servicer has the ability to service the Mortgage Loans as provided in
this Agreement.
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ARTICLE VI
TERMINATION
Section 6.01 Termination.
(a) Termination of Servicer. The respective obligations and
responsibilities of the Servicer shall terminate upon: (i) the later of the
final payment or other liquidation (or any advance with respect thereto) of
the last Mortgage Loan or the disposition of all REO Property and the
remittance of all funds due hereunder; or (ii) by mutual consent of the
Servicer and the Purchaser in writing; or (iii) in the event that the Mortgage
Loans become the subject of a Securitization Transaction, in accordance with
any requirements of any rating agency which has rated or will rate some or all
of the securities issued in connection with such Securitization Transaction,
as such requirements pertain to such Securitization Transaction.
(b) Agency Suspension. Should the Servicer at any time during the
term of this Agreement have its right to service temporarily or permanently
suspended by Xxxxxx Xxx and Xxxxxxx Mac or otherwise cease to be an approved
servicer of conventional residential mortgage loans for Xxxxxx Mae or Xxxxxxx
Mac, then the Purchaser may immediately terminate this Agreement and
accelerate performance of the provisions of the Purchase Agreement to require
immediate transfer of the Servicing Rights.
Section 6.02 Termination Upon Transfer of Servicing.
(a) Termination Procedures. Subject to Section 11.01, the
Purchaser may terminate this Agreement and transfer the servicing from the
Servicer with respect to the Mortgage Loans on such date as the Purchaser
shall inform the Servicer (the "Transfer Date") by providing written notice to
the Servicer at least 30 Business Days prior to the Transfer Date of its
intent to transfer the servicing of the Mortgage Loans from the Servicer on
the Transfer Date, provided that, in any event, the Servicer shall be given
timely notice to allow it to notify the related mortgagors of the transfer of
servicing in accordance with the requirements of the Real Estate Settlement
Procedures Act and the Xxxxxxxx Xxxxxxxx National Affordable Housing Act of
1990, as amended. On or before the Transfer Date specified by the Purchaser in
accordance with this paragraph (a) for the transfer of servicing from the
Servicer, the Servicer shall prepare, execute and deliver to the successor
entity designated by the Purchaser any and all documents and other
instruments, place in such successor's possession all Mortgage Loan Documents
necessary or appropriate to effect the purposes of such notice of termination,
including but not limited to the transfer and endorsement or assignment of the
related Mortgage Loans and related documents, at the Purchaser's sole expense.
The Servicer shall cooperate fully with the Purchaser and such successor in
effecting the termination of the Servicer's responsibilities and rights
hereunder.
Except as otherwise provided in this Agreement, on the Transfer
Date for each Mortgage Loan, this Agreement, except for Articles VI, VIII, IX
and X which shall survive the related Transfer Date, shall terminate with
respect to such Mortgage Loan.
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(b) Servicing Advances and Advances of Principal and Interest. The
Servicer shall be reimbursed for any Servicing Advances or advances of
principal and interest in relation to any Mortgage Loan no later than five (5)
Business Days following the related Transfer Date, notwithstanding the fact
that the Servicer or the successor servicer has not received a Monthly Payment
or Liquidation Proceeds in relation to such Mortgage Loan. At such time, the
Servicer shall be entitled to be reimbursed for all unreimbursed Servicing
Advances and/or advances of principal and interest with respect to such
Mortgage Loan on a first priority basis from the Monthly Payment or
Liquidation Proceeds received with respect to such Mortgage Loan. This Section
6.02(b) shall survive each Transfer Date.
ARTICLE VII
BOOKS AND RECORDS
Section 7.01 Possession of Servicing Files.
The contents of each Servicing File are and shall be held in trust
by the Servicer for the benefit of the Purchaser as the owner thereof. The
Servicer shall maintain in the Servicing File a copy of the contents of each
Mortgage File and the originals of the documents in each Mortgage File not
delivered to the Purchaser. The possession of the Servicing File by the
Servicer is at the will of the Purchaser for the sole purpose of servicing the
related Mortgage Loan, pursuant to this Agreement, and such retention and
possession by the Servicer is in its capacity as Servicer only and at the
election of the Purchaser. The Servicer shall release its custody of the
contents of any Servicing File only in accordance with written instructions
from the Purchaser, unless such release is required as incidental to the
Servicer's servicing of the Mortgage Loans pursuant to this Agreement, or is
in connection with a repurchase of any Mortgage Loan pursuant to Section 9 of
the Purchase Agreement.
The Servicer shall be responsible for maintaining, and shall
maintain, a complete set of books and records for each Mortgage Loan which
shall be marked clearly to reflect the ownership of each Mortgage Loan by the
Purchaser. In particular, the Servicer shall maintain in its possession,
available for inspection by the Purchaser's designee, and shall deliver to the
Purchaser or its designee upon demand, evidence of compliance with all
federal, state and local laws, rules and regulations, including but not
limited to documentation as to the method used in determining the
applicability of the provisions of the National Flood Insurance Act of 1968,
as amended, to the Mortgaged Property, documentation evidencing insurance
coverage and eligibility of any condominium project pursuant to Accepted
Servicing Practices and periodic inspection reports as required by Section
2.13.
The Servicer shall keep at its servicing office books and records
in which, subject to such reasonable regulations as it may prescribe, the
Servicer shall note transfers of Mortgage Loans. No transfer of a Mortgage
Loan may be made unless such transfer is in compliance with the terms hereof.
For the purposes of this Agreement, the Servicer shall be under no obligation
to deal with any person with respect to this Agreement or the Mortgage Loans
unless the books and records show such person as the owner of the Mortgage
Loan. The Purchaser may, subject to the terms of this Agreement, sell or
transfer one or more of the Mortgage Loans, provided, however, that the
transferee will not be deemed to be a Purchaser hereunder binding upon the
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Servicer unless such transferee shall agree in writing to be bound by the
terms of this Agreement and of the assignment and assumption of this Agreement
executed by the transferee shall have been delivered to the Servicer. The
Purchaser also shall advise the Servicer of the transfer. Upon receipt of
notice of the transfer, the Servicer shall cause its books and records to
reflect the ownership of the Mortgage Loans of such assignee, and shall
release the previous Purchaser from its obligations hereunder with respect to
the Mortgage Loans sold or transferred.
ARTICLE VIII
INDEMNIFICATION AND ASSIGNMENT
Section 8.01 Indemnification.
The Servicer agrees to indemnify and hold the Purchaser harmless
from any liability, claim, loss or damage (including, without limitation, any
reasonable legal fees, judgments or expenses relating to such liability,
claim, loss or damage) to the Purchaser directly or indirectly resulting from
the Servicer's failure:
(a) to observe and perform any or all of Servicer's duties,
obligations, covenants, agreements, warranties or representations contained in
this Agreement or in the Purchase Agreement; or
(b) to comply with all applicable requirements with respect to the
servicing of the Mortgage Loans as set forth herein.
The Servicer immediately shall notify the Purchaser if a claim is
made by a third party with respect to this Agreement.
Section 8.02 Limitation on Liability of Servicer and Others.
Neither the Servicer nor any of the directors, officers, employees
or agents of the Servicer shall be under any liability to the Purchaser for
any action taken or for refraining from the taking of any action in good faith
pursuant to this Agreement, or for errors in judgment, provided, however, that
this provision shall not protect the Servicer or any such person against any
breach of warranties or representations made herein, its own negligent
actions, 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 Servicer and any director, officer, employee or agent of
the Servicer 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 Servicer shall not be under any obligation to appear in,
prosecute or defend any legal action which is not incidental to its duties to
service the Mortgage Loans in accordance with this Agreement and which in its
opinion may involve it in any expense or liability, provided, however, that
the Servicer may, with the prior written 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
Servicer shall be entitled to reimbursement from the Purchaser of the
reasonable legal expenses and costs of such action.
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Section 8.03 Limitation on Resignation and Assignment by Servicer.
The Purchaser has entered into this Agreement with the Servicer
and subsequent purchasers will purchase the Mortgage Loans in reliance upon
the independent status of the Servicer, and the representations as to the
adequacy of its servicing facilities, plant, personnel, records and
procedures, its integrity, reputation and financial standing, and the
continuance thereof. Therefore, the Servicer shall not assign this Agreement
or the servicing hereunder or delegate its rights or duties hereunder or any
portion hereof or sell or otherwise dispose of all or substantially all of its
property or assets without the prior written consent of the Purchaser, which
consent shall be granted or withheld in the sole discretion of the Purchaser.
The Servicer shall not resign from the obligations and duties
hereby imposed on it except by consent of the Purchaser or upon the
determination that its duties hereunder are no longer permissible under
applicable law and such incapacity cannot be cured by the Servicer. Any such
determination permitting the resignation of the 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. No such
resignation shall become effective until a successor shall have assumed the
Servicer's responsibilities and obligations hereunder in the manner provided
in Section 6.02.
Without in any way limiting the generality of this Section 8.03,
in the event that the Servicer either shall assign this Agreement or the
servicing responsibilities hereunder or delegate its 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 consent of the Purchaser,
then the Purchaser shall have the right to terminate this Agreement upon
notice given as set forth in Section 12.01, without any payment of any penalty
or damages and without any liability whatsoever to the Purchaser or any third
party.
Section 8.04 Assignment by Purchaser.
The Purchaser shall have the right, without the consent of the
Servicer, to assign, in whole or in part, its interest under this Agreement
with respect to some or all of the Mortgage Loans, and designate any person to
exercise any rights of the Purchaser hereunder, by executing an assignment and
assumption agreement and the assignee or designee shall accede to the rights
and obligations hereunder of the Purchaser with respect to such Mortgage
Loans. All references to the Purchaser in this Agreement shall be deemed to
include its assignee or designee. Any such notice of assignment shall be in
writing and delivered to the Servicer as provided in Section 12.01 of this
Agreement.
Section 8.05 Merger or Consolidation of the Servicer.
The Servicer will keep in full effect its existence, rights and
franchises as a corporation under the laws of the state of its incorporation
except as permitted herein, and will 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 perform
its duties under this Agreement. Any Person into which the Servicer may be
merged or consolidated, or any corporation resulting from
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any merger, conversion or consolidation to which the Servicer shall be a
party, or any Person succeeding to the business of the Servicer, shall be the
successor of the Servicer 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 be an institution whose deposits are insured by FDIC
or a company whose business includes the origination and servicing of mortgage
loans, shall meet the requirements set forth in Section 6.02 hereof, and shall
have a tangible net worth not less than $25,000,000.
ARTICLE IX
REPRESENTATIONS, WARRANTIES AND COVENANTS OF PURCHASER
As of the Closing Date, the Purchaser warrants and represents to,
and covenants and agrees with, the Servicer as follows:
Section 9.01 Authority and Capacity.
The execution, delivery and performance by the Purchaser of this
Agreement has been duly and validly authorized by all necessary corporate
action. This Agreement constitutes a legal, valid and enforceable obligation
of the Purchaser.
ARTICLE X
REPRESENTATIONS AND WARRANTIES OF SERVICER
As of the Closing Date, the Servicer warrants and represents to,
and covenants and agrees with, the Purchaser as follows:
Section 10.01 Due Organization and Authority.
The Servicer is a federal savings bank duly organized, validly
existing and in good standing under the laws of the United States of America
as now being conducted and is licensed, qualified and in good standing in each
state where a Mortgaged Property is located if the laws of such state require
licensing or qualification in order to conduct business of the type conducted
by the Servicer, and in any event the Servicer is in compliance with the laws
of any such state to the extent necessary to ensure the enforceability of the
related Mortgage Loan in accordance with the terms of this Agreement; the
Servicer has the full corporate power and authority to execute and deliver
this Agreement and to perform in accordance herewith; the execution, delivery
and performance of this Agreement (including all instruments or transfer to be
delivered pursuant to this Agreement) by the Servicer and the consummation of
the transactions contemplated hereby have been duly and validly authorized;
this Agreement evidences the valid, binding and enforceable obligation of the
Servicer; and all requisite corporate action has been taken by the Servicer to
make this Agreement valid and binding upon the Servicer in accordance with its
terms;
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Section 10.02 Ordinary Course of Business.
The consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Servicer.
Section 10.03 No Conflicts.
Neither the execution and delivery of this Agreement, nor the
fulfillment of or compliance with the terms and conditions of this Agreement,
will conflict with or result in a breach of any of the terms, conditions or
provisions of the Servicer's charter or by-laws or any legal restriction or
any agreement or instrument to which the Servicer is now a party or by which
it is bound, or constitute a default or result in an acceleration under any of
the foregoing, or result in the violation of any law, rule, regulation, order,
judgment or decree to which the Servicer or its property is subject, or impair
the ability of the Purchaser to realize on the Mortgage Loans, or impair the
value of the Mortgage Loans.
Section 10.04 Ability to Service.
The Servicer is an approved servicer of conventional residential
mortgage loans for Xxxxxx Xxx or Xxxxxxx Mac, with the facilities, procedures,
and experienced personnel necessary for the sound servicing of mortgage loans
of the same type as the Mortgage Loans. The Servicer is in good standing to
enforce, originate, sell mortgage loans to, and service mortgage loans in the
jurisdictions wherein the Mortgaged Properties are located and with Xxxxxx Mae
and Xxxxxxx Mac, and no event has occurred, including but not limited to a
change in insurance coverage, which would make the Servicer unable to comply
with Xxxxxx Mae or Xxxxxxx Mac eligibility requirements or which would require
notification to either Xxxxxx Mae or Xxxxxxx Mac.
Section 10.05 Ability to Perform.
The Servicer 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.
Section 10.06 No Litigation Pending.
There is no action, suit, proceeding or investigation pending or
threatened against the Servicer, before any court, administrative agency or
other tribunal asserting the invalidity of this Agreement, seeking to prevent
the consummation of any of the transactions contemplated by this Agreement or
which, either in any one instance or in the aggregate, may result in any
material adverse change in the business, operations, financial condition,
properties or assets of the Servicer, or in any material impairment of the
right or ability of the Servicer to carry on its business substantially as now
conducted, or in any material liability on the part of the Servicer, or which
would draw into question the validity of this Agreement or the Mortgage Loans
or of any action taken or to be taken in connection with the obligations of
the Servicer contemplated herein, or which would be likely to impair
materially the ability of the Servicer to perform under the terms of this
Agreement.
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Section 10.07 No Consent Required.
No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Servicer of or compliance by the Servicer with this
Agreement or the servicing of the Mortgage Loans as evidenced by the
consummation of the transactions contemplated by this Agreement, or if
required, such approval has been obtained prior to the Closing Date.
Section 10.08 No Untrue Information.
Neither this Agreement nor any statement, report or other document
furnished or to be furnished pursuant to this Agreement or in connection with
the transactions contemplated hereby contains any untrue statement of fact or
omits to state a fact necessary to make the statements contained therein not
misleading.
Section 10.09 Reasonable Servicing Fee.
The Servicer acknowledges and agrees that the Servicing Fee
represents reasonable compensation for performing such services and that the
entire Servicing Fee shall be treated by the Servicer, for accounting and tax
purposes, as compensation for the servicing and administration of the Mortgage
Loans pursuant to this Agreement and the Purchase Agreement.
ARTICLE XI
DEFAULT
Section 11.01 Events of Default.
The following shall constitute an Event of Default under this
Agreement on the part of the Servicer:
(a) any failure by the Servicer to remit to the Purchaser any
payment required to be made under the terms of this Agreement which continues
unremedied for a period of two Business Days after the date upon which written
notice of such failure, requiring the same to be remedied, shall have been
given to the Servicer by the Purchaser; or
(b) the failure by the Servicer duly to observe or perform in any
material respect any other of the covenants or agreements on the part of the
Servicer set forth in this Agreement which continues unremedied for a period
of 30 days (except that such number of days shall be fifteen 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 Servicer by
the Purchaser or by the Custodian; or
(c) 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, marshaling
of assets and liabilities or similar proceedings, or
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for the winding-up or liquidation of its affairs, shall have been entered
against the Servicer and such decree or order shall have remained in force
undischarged or unstayed for a period of 60 days; or
(d) the Servicer shall consent to the appointment of a conservator
or receiver or liquidator in any insolvency, bankruptcy, readjustment of debt,
marshaling of assets and liabilities or similar proceedings of or relating to
the Servicer or of or relating to all or substantially all of its property; or
(e) the Servicer 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
(f) the Servicer attempts to assign its right to servicing
compensation hereunder or the Servicer attempts, without the 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
(g) the Servicer fails to maintain its license to do business or
service residential mortgage loans in any jurisdiction where the Mortgaged
Properties are located.
In each and every such case, so long as an Event of Default shall
not have been remedied, in addition to whatsoever rights the Purchaser may
have at law or equity to damages, including injunctive relief and specific
performance, the Purchaser, by notice in writing to the Servicer, may
immediately terminate without compensation all the rights and obligations of
the Servicer under this Agreement and any Reconstitution Agreement and in and
to the Mortgage Loans and the proceeds thereof, provided, however, that with
respect to any termination as a result of an Event of Default under clause (c)
or (d) above, the Servicer, within sixty (60) days following receipt of such
notice from the Purchaser, shall have the right to deliver to the Purchaser a
firm commitment by a third party servicer (an "Acceptable Commitment"), which
commitment is in form and substance acceptable to the Purchaser in its sole
discretion, to purchase the Servicing Rights and assume the servicing
obligations hereunder or under any Reconstitution Agreement related to any of
the Mortgage Loans; provided further that such third party servicer is
acceptable to the Purchaser in its sole discretion.
Upon receipt by the Servicer of such written notice, all authority
and power of the Servicer under this Agreement, whether with respect to the
Mortgage Loans or otherwise, shall pass to and be vested in the successor
appointed pursuant to Section 6.02. Upon written request from the Purchaser,
the Servicer shall prepare, execute and deliver any and all documents and
other instruments, place in such successor'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, or otherwise, at the Servicer's sole expense. The Servicer agrees
to cooperate with the Purchaser and such successor in effecting the
termination of the Servicer's responsibilities and rights hereunder,
including, without limitation, the transfer to such successor for
administration by it of all cash amounts which shall at the time be credited
by the Servicer to
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the Custodial Account or Escrow Account or thereafter received with respect to
the Mortgage Loans.
Section 11.02 Waiver of Defaults.
The Purchaser may waive any default by the Servicer 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.
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01 Notices.
All notices, requests, demands and other communications which are
required or permitted to be given under this Agreement shall be in writing and
shall be deemed to have been duly given upon the delivery or mailing thereof,
as the case may be, sent by registered or certified mail, return receipt
requested:
(a) If to Purchaser to:
Xxxxxx Xxxxxxx Mortgage Capital Inc.
1221 Avenue of the Xxxxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxxxxxx - Whole Loan Operations Manager
Fax: 000-000-0000
Email: xxxxx.xxxxxxxxxx@xxxxxxxxxxxxx.xxx
with copies to:
Xxxx Xxxxxxxx
Xxxxxx Xxxxxxx - Servicing Oversight
0000 X-Xxx Xxx
Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
Fax: 000-000-0000
Email: xxxx.xxxxxxxx@xxxxxxxxxxxxx.xxx
(b) If to Servicer to:
IndyMac Bank, F.S.B.
Capital Markets
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0000 X. Xxxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: SVP, Chief Operations Officer
Section 12.02 Waivers.
Either the Servicer or the Purchaser may upon consent of all
parties, by written notice to the others:
(a) Waive compliance with any of the terms, conditions or
covenants required to be complied with by the others hereunder; and
(b) Waive or modify performance of any of the obligations of the
others hereunder.
The waiver by any party hereto of a breach of any provision of
this Agreement shall not operate or be construed as a waiver of any other
subsequent breach.
Section 12.03 Entire Agreement; Amendment.
This Agreement and the Purchase Agreement constitute the entire
agreement between the parties with respect to servicing of the Mortgage Loans.
This Agreement may be amended and any provision hereof waived, but, only in
writing signed by the party against whom such enforcement is sought.
Section 12.04 Execution; Binding Effect.
This Agreement may be executed in one or more counterparts and by
the different parties hereto on separate counterparts, each of which, when so
executed, shall be deemed to be an original; such counterparts, together,
shall constitute one and the same agreement. Subject to Sections 8.03 and
8.04, this Agreement shall inure to the benefit of and be binding upon the
Servicer and the Purchaser and their respective successors and assigns.
Section 12.05 Headings.
Headings of the Articles and Sections in this Agreement are for
reference purposes only and shall not be deemed to have any substantive
effect.
Section 12.06 Applicable Law.
This Agreement shall be construed in accordance with the laws of
the State of New York and the obligations, rights and remedies hereunder shall
be determined in accordance with the substantive laws of the State of New York
(without regard to conflicts of laws principles), except to the extent
preempted by Federal law.
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Section 12.07 Relationship of Parties.
Nothing herein contained shall be deemed or construed to create a
partnership or joint venture between the parties. The duties and
responsibilities of the Servicer shall be rendered by it as an independent
contractor and not as an agent of the Purchaser. The Servicer shall have full
control of all of its acts, doings, proceedings, relating to or requisite in
connection with the discharge of its duties and responsibilities under this
Agreement.
Section 12.08 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or
terms of this Agreement shall be held invalid for any reason whatsoever, then
such covenants, agreements, provisions or terms shall be deemed severable from
the remaining covenants, agreements, provisions or terms of this Agreement and
shall in no way affect the validity or enforceability of the other provisions
of this Agreement.
Section 12.09 [Reserved].
Section 12.10 Exhibits.
The exhibits to this Agreement are hereby incorporated and made a
part hereof and are integral parts of this Agreement.
Section 12.11 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 12.12 No Solicitation.
From and after the Closing Date, the Servicer agrees that it will
not take any action or permit or cause any action to be taken by any of its
agents or affiliates, or by any independent contractors on the Servicer's
behalf, to personally, by telephone or mail (via electronic means or
otherwise), solicit the borrower or obligor under any Mortgage Loan for any
purpose whatsoever, including to refinance a Mortgage Loan, in whole or in
part, without (i) the prior written consent of the Purchaser; or (ii) written
notice from the related borrower or obligor under a Mortgage Loan of such
party's intention to refinance such Mortgage Loan. It is understood and agreed
that all rights and benefits relating to the solicitation of any Mortgagors
and the attendant rights, title and interest in and to the list of such
Mortgagors and data relating to their Mortgages (including insurance renewal
dates) shall be transferred to the Purchaser pursuant hereto on the Closing
Date and the Servicer shall take no action to undermine these rights and
benefits. Notwithstanding the foregoing, it is understood and agreed that
promotions undertaken by the Servicer or any affiliate of the Servicer which
are directed to the general public at large, including, without limitation,
mass mailing based on commercially acquired mailing lists, newspaper, radio
and television advertisements shall not constitute solicitation under this
Section 12.12.
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Section 12.13 Cooperation of Servicer with a Reconstitution.
The Servicer and the Purchaser agree that with respect to some or
all of the Mortgage Loans, after the Closing Date, on one or more dates (each
a "Reconstitution Date") at the Purchaser's sole option, the Purchaser may
effect a sale (each, a "Reconstitution") of some or all of the Mortgage Loans
then subject to this Agreement, without recourse, to:
a) Xxxxxx Mae under its Cash Purchase Program or MBS
Program (Special Servicing Option) (each a "Xxxxxx Xxx
Transfer"); or
b) Xxxxxxx Mac (the "Xxxxxxx Mac Transfer"); or
c) one or more third party purchasers in one or more
Whole Loan Transfers; or
d) one or more trusts or other entities to be formed as
part of one or more Securitization Transactions.
The Servicer agrees to execute in connection with any Agency
Transfer, any and all pool purchase contracts, and/or agreements reasonably
acceptable to the Servicer among the Purchaser, the Servicer, Xxxxxx Mae or
Xxxxxxx Mac (as the case may be) and any servicer in connection with a Whole
Loan Transfer, an assignment and assumption agreement or a participation and
servicing agreement in form and substance reasonably acceptable to the
Servicer, and in connection with a Securitization Transaction, a pooling and
servicing agreement or sale and servicing agreement in form and substance
reasonably acceptable to the Servicer (collectively the agreements referred to
herein are designated, the "Reconstitution Agreements").
With respect to each Whole Loan Transfer and each Securitization
Transaction entered into by the Purchaser, the Servicer agrees (1) to
cooperate fully with the Purchaser and any prospective purchaser with respect
to all reasonable requests and due diligence procedures; (2) to execute,
deliver and perform all Reconstitution Agreements required by the Purchaser;
(3) to restate the representations and warranties set forth in this Agreement
as of the settlement or closing date in connection with such Reconstitution.
In that connection, the Servicer shall provide to such master servicer or
issuer, as the case may be, and any other participants in such Reconstitution:
(i) any and all information and appropriate verification of information which
may be reasonably available to the Servicer or its affiliates, whether through
letters of its auditors and counsel or otherwise, as the Purchaser or any such
other participant shall request; (ii) such additional reasonable
representations, warranties, covenants, opinions of counsel, letters from
auditors, and certificates of public officials or officers of the Servicer as
are believed necessary by the Purchaser or any such other participant; and
(iii) to execute, deliver and satisfy all conditions set forth in any
indemnity agreement required by the Purchaser or any such participant mutually
agreeable to the Servicer and the Purchaser. The Servicer shall indemnify the
Purchaser, each Affiliate designated by the Purchaser and each Person who
controls the Purchaser or such Affiliate and hold each of them harmless from
and against any losses, damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs, judgments, and any other costs, fees
and expenses that each of them may sustain in any way related to any
information provided by or on behalf of the Servicer regarding the Servicer,
the
36
Servicer's servicing practices or performance, the Mortgage Loans or the
Underwriting Guidelines set forth in any offering document prepared in
connection with any Reconstitution. Moreover, the Servicer agrees to cooperate
with all reasonable requests made by the Purchaser to effect such
Reconstitution Agreements. But in no event shall the Servicer be obligated to
any greater extent under a Reconstitution Agreement than it is under this
Agreement. For purposes of this Section, "Purchaser" shall mean the Person
then acting as the Purchaser under this Agreement and any and all Persons who
previously were "Purchasers" under this Agreement.
All Mortgage Loans not sold or transferred pursuant to a
Reconstitution shall remain subject to this Agreement and, if this Agreement
shall remain in effect with respect to the Mortgage Loans, shall continue to
be serviced in accordance with the terms of this Agreement and the Purchase
Agreement and with respect thereto this Agreement shall remain in full force
and effect.
With respect to any Securitization Transaction, the Servicer
agrees that on or prior to March 1st of each year, the Servicer shall deliver
to the Purchaser and the trustee for such Securitization Transaction, a
certification substantially the form annexed hereto as Exhibit 7, executed by
the senior officer in charge of servicing at the Servicer, for inclusion in
the Annual Report on Form 10-K to be filed with the Securities and Exchange
Commission with respect to the trust formed for such Securitization
Transaction. The Servicer shall indemnify and hold harmless the Purchaser, the
depositor for such Securitization Transaction, the trustee for such
Securitization Transaction and their respective officers, directors and
Affiliates from and against any losses, damages, penalties, fines,
forfeitures, reasonable and necessary legal fees and related costs, judgments
and other costs and expenses arising out of or based upon any breach of the
Servicer's obligations under this paragraph or the Servicer's negligence, bad
faith or willful misconduct in connection therewith. If the indemnification
provided for herein is unavailable or insufficient to hold harmless the
indemnified party, then the Servicer agrees that it shall contribute to the
amount paid or payable by such depositor and/or such trustee as a result of
the losses, claims, damages or liabilities of such depositor and/or such
trustee in such proportion as is appropriate to reflect the relative fault of
such depositor or such trustee, as the case may be, on the one hand and the
Servicer on the other in connection with a breach of the Servicer's
obligations under this paragraph or the Servicer's negligence, bad faith or
willful misconduct in connection therewith.
Section 12.14 Waiver of Trial by Jury.
THE SERVICER AND THE PURCHASER EACH KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY
RIGHT IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR RELATING
TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
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Section 12.15 Submission To Jurisdiction; Waivers.
The Servicer 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) ONSENTS 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 HEREIN OR AT SUCH OTHER ADDRESS OF WHICH THE
PURCHASER SHALL HAVE BEEN NOTIFIED; 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.
ARTICLE XIII
COMPLIANCE WITH REGULATION AB PROVISIONS
Section 13.01 Intent of the Parties; Reasonableness.
The Purchaser and the Servicer acknowledge and agree that the
purpose of Article XIII 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 Servicer 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.
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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 Servicer
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
requests made by the Purchaser or any Depositor in good faith for delivery of
information under these provisions on the basis of evolving interpretations of
Regulation AB. In connection with any Securitization Transaction, the Servicer
shall cooperate fully with the Purchaser to deliver to the Purchaser
(including any of its 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 or any Depositor to
permit the Purchaser or such Depositor to comply with the provisions of
Regulation AB, together with such disclosures relating to the Servicer any
Subservicer 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.
Section 13.02 Additional Representations and Warranties of the Servicer.
(a) The Servicer shall be deemed to represent to the Purchaser and
to any Depositor, as of the date on which information is first provided to the
Purchaser or any Depositor under Section 13.03 that, except as disclosed in
writing to the Purchaser or such Depositor prior to such date: (i) the
Servicer 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 Servicer ; (ii)
the Servicer 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 Servicer has been disclosed or
reported by the Servicer; (iv) no material changes to the Servicer '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 Servicer 's financial condition that could have a material
adverse effect on the performance by the Servicer 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 Servicer or any Subservicer; and (vii) there are no
affiliations, relationships or transactions relating to the Servicer or any
Subservicer 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.
(b) If so requested by the Purchaser or any Depositor on any date
following the date on which information is first provided to the Purchaser or
any Depositor under Section 13.03, the Servicer 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
39
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.
Section 13.03 Information to Be Provided by the Servicer .
In connection with any Securitization Transaction the Servicer
shall (i) within five Business Days following request by the Purchaser or any
Depositor, provide to the Purchaser and such Depositor (or cause 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 (a), (c) and (f) of this Section, and (ii)
as promptly as practicable following notice to or discovery by the Servicer ,
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 (d) of this Section.
(a) If so requested by the Purchaser or any Depositor, the
Servicer shall provide such information regarding each Subservicer, as is
requested for the purpose of compliance with Items 1103(a)(1), 1117 and 1119
of Regulation AB. Such information shall include, at a minimum:
(A) [Reserved];
(B) [Reserved];
(C) a description of any material legal or governmental
proceedings pending (or known to be contemplated) against
the Servicer and each Subservicer; and
(D) a description of any affiliation or relationship between the
Servicer , each Subservicer 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.
(b) [Reserved].
(c) If so requested by the Purchaser or any Depositor, the
Servicer shall provide such information regarding the Servicer , as servicer
of the Mortgage Loans, and each Subservicer (each of the Servicer and each
Subservicer, for purposes of this paragraph, a
40
"Servicer"), as is requested for the purpose of compliance with Item 1108 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
41
performance by the Servicer 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; and
(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.
(d) If so requested by the Purchaser 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 Servicer shall (or shall
cause each Subservicer to) (i) notify the Purchaser and any Depositor in
writing of (A) any material litigation or governmental proceedings pending
against the Servicer or any Subservicer and (B) any affiliations or
relationships that develop following the closing date of a Securitization
Transaction between the Servicer or any Subservicer and any of the parties
specified in clause (D) of paragraph (a) of this Section (and any other
parties identified in writing by the requesting party) with respect to such
Securitization Transaction, and (ii) provide to the Purchaser and any
Depositor a description of such proceedings, affiliations or relationships.
(e) As a condition to the succession to the Servicer or any
SubServicer or subservicer under this Agreement or any Reconstitution
Agreement by any Person (i) into which the Servicer or such Subservicer may be
merged or consolidated, or (ii) which may be appointed as a successor to the
Servicer or any Subservicer, the Servicer 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.
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(f) In addition to such information as the Servicer , as servicer,
is obligated to provide pursuant to other provisions of this Agreement, if so
requested by the Purchaser or any Depositor, the Servicer shall provide such
information regarding the performance or servicing of the Mortgage Loans as is
reasonably required by the Purchaser or any Depositor to facilitate
preparation of distribution reports in accordance with Item 1121 of Regulation
AB and to permit the Purchaser or such Depositor to comply with the provisions
of Regulation AB relating to Static Pool Information regarding the performance
of the Mortgage Loans on the basis of the Purchaser's or such Depositor's
reasonable, good faith interpretation of the requirements of Item
1105(a)(1)-(3) of Regulation AB (including without limitation as to the format
and content of such Static Pool Information) in connection with any future
securitization by the Purchaser or any Depositor of mortgage loans of a
similar type as the Mortgage Loans. 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 in
connection with the applicable Securitization Transaction).
Section 13.04 Servicer Compliance Statement.
On or before March 1 of each calendar year, commencing in 2007,
the Servicer shall deliver to the Purchaser and any Depositor a statement of
compliance addressed to the Purchaser and such Depositor and signed by an
authorized officer of the Servicer , to the effect that (i) a review of the
Servicer '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 Servicer 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.
Section 13.05 Report on Assessment of Compliance and Attestation.
(a) On or before March 1 of each calendar year, commencing in
2007, the Servicer shall:
(i) deliver to the Purchaser and any Depositor a report (in form
and substance reasonably satisfactory to the Purchaser and such
Depositor) regarding the Servicer'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 and
such Depositor and signed by an authorized officer of the Servicer, and
shall address each of the Servicing Criteria specified on a
certification substantially in the form of Exhibit 8 hereto delivered to
the Purchaser concurrently with the execution of this Agreement;
(ii) deliver to the Purchaser and any Depositor a report of a
registered public accounting firm reasonably acceptable to the Purchaser
and such Depositor that attests to, and reports on, the assessment of
compliance made by the Servicer and delivered
43
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;
(iii) cause each Subservicer, and each Subcontractor determined by
the Company pursuant to Section 13.06(b) to be "participating in the
servicing function" within the meaning of Item 1122 of Regulation AB, to
deliver to the Purchaser and any Depositor an assessment of compliance
and accountants' attestation as and when provided in paragraphs (a) and
(b) of this Section; and
(iv) 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 7.
The Servicer acknowledges that the parties identified in clause
(a)(iv) above may rely on the certification provided by the Servicer 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 (a)(iv) 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.
(b) Each assessment of compliance provided by a Subservicer
pursuant to Section 13.05(a)(i) shall address each of the Servicing Criteria
specified on a certification substantially in the form of Exhibit 7 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(a)(iii) need not address any elements
of the Servicing Criteria other than those specified by the Servicer pursuant
to Section 13.06.
Section 13.06 Use of Subservicers and Subcontractors.
The Servicer shall not hire or otherwise utilize the services of
any Subservicer to fulfill any of the obligations of the Servicer under this
Agreement or any Reconstitution Agreement unless the Servicer complies with
the provisions of paragraph (a) of this Section. The Servicer 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 Servicer under this
Agreement or any Reconstitution Agreement unless the Servicer complies with
the provisions of paragraph (b) of this Section.
(a) The Servicer shall not hire or otherwise utilize the services
of any Subservicer with respect to the Mortgage Loans without giving the
Purchaser or its designee fifteen (15) calendar days' advance written notice
of the effective date of such hiring or utilization of a Subservicer, followed
by written confirmation of such hiring or utilization of a Subservicer on the
effective date of such engagement and indicating the circumstances surrounding
such hiring or utilization. Any notices required by this Section 13.06(a)
shall be sent via telecopier or certified or registered mail to the addresses
set forth below: Xxxx X.
44
Xxxxxxxx, Servicer Oversight Group, 0000 X-Xxx Xxxxxx, Xxxxx 000, Xxxx Xxxxx,
Xxxxxxx 00000, Telecopy: 000-000-0000 and emailed to:
xxxxx_xxxxxxxx_xxxxxx@xxxxxxxxxxxxx.xxx, with a copy to Xxxxx Xxxxxx, XxXxx
Xxxxxx LLP, 0 Xxxxxxx Xxxx Xxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Telecopy:
000-000-0000, Email: xxxxxxx@xxxxxxxxxxx.xxx (or such other address as such
Person may otherwise specify to Servicer). The Servicer shall cause any
Subservicer used by the Servicer (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(c) and (e), 13.04, 13.05 and 13.07 of this
Agreement to the same extent as if such Subservicer were the Servicer, and to
provide the information required with respect to such Subservicer under
Section 13.03(d) of this Agreement. The Servicer 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.
(b) It shall not be necessary for the Servicer to seek the consent
of the Purchaser or any Depositor to the utilization of any Subcontractor. The
Servicer shall promptly upon request provide to the Purchaser and any
Depositor (or any designee of the Depositor, such as a master servicer or
administrator) a written description (in form and substance satisfactory to
the Purchaser and such Depositor) of the role and function of each
Subcontractor utilized by the Servicer 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 Servicer shall cause any such Subcontractor used by
the Servicer (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 Servicer . The
Servicer 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.
Section 13.07 Indemnification; Remedies.
(a) The Servicer shall indemnify the Purchaser, each affiliate of
the Purchaser, 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 Xxxxxxx
00 xx xxx
00
Xxxxxxxx Xxx); and the respective present and former directors, officers,
employees and agents of each of the foregoing and of the Depositor, and shall
hold each of them harmless from and against any 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,
accountants' letter or other material provided in written or electronic
form under this Article XIII by or on behalf of the Servicer , or
provided under this Article XIII by or on behalf of any Subservicer or
Subcontractor (collectively, the "Servicer Information"), or (B) the
omission or alleged omission to state in the Servicer Information a
material fact required to be stated in the Servicer 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 Servicer Information and not to any
other information communicated in connection with a sale or purchase of
securities, without regard to whether the Servicer Information or any
portion thereof is presented together with or separately from such other
information;
(ii) any failure by the Servicer , any Subservicer or any
Subcontractor to deliver any information, report, certification,
accountants' letter or other material when and as required under this
Article XIII, including any failure by the Servicer to identify pursuant
to Section 13.06(b) any Subcontractor "participating in the servicing
function" within the meaning of Item 1122 of Regulation AB; or
(iii) any breach by the Servicer of a representation or warranty
set forth in Section 13.02(a) or in a writing furnished pursuant to
Section 13.02(b) 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 Servicer of a
representation or warranty in a writing furnished pursuant to Section
13.02(b) to the extent made as of a date subsequent to such closing
date.
In the case of any failure of performance described in clause
(a)(ii) of this Section, the Servicer 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 Servicer, any Subservicer or any Subcontractor.
(b) (i) Any failure by the Seller, Servicer, any Subservicer or
any Subcontractor to deliver any information, report, certification,
accountants' letter or other material when and as required under this Article
XIII or under Section 34 of the Purchase Agreement, or any breach by the
Servicer of a representation or warranty set forth in Section 13.02(a) or in a
writing furnished pursuant to Section 13.02(b) or any breach by the
46
Seller of a representation or warranty set forth in Section 34.02(a) of the
Purchase Agreement or in a writing furnished pursuant to Section 34.02(b) of
the Purchase Agreement 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 Servicer of a representation
or warranty in a writing furnished pursuant to Section 13.02(b) or any breach
by the Seller of a representation or warranty in a writing furnished pursuant
to Section 34.02(b) of the Purchase Agreement 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 Servicer under this
Agreement and any applicable Reconstitution Agreement, and shall entitle the
Purchaser or Depositor, as applicable, in its sole discretion to terminate the
rights and obligations of the 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 Servicer ; 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 Servicer as servicer, such provision shall be given effect.
(ii) Any failure by the Servicer , 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 Servicer to
identify pursuant to Section 13.06(b) 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 Servicer under this Agreement and any applicable
Reconstitution Agreement, and shall entitle the Purchaser or Depositor,
as applicable, in its sole discretion to terminate the rights and
obligations of the 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 Servicer ;
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
Servicer 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 Company pursuant to this
subparagraph (b)(ii) if a failure of the Company 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 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 expenses incurred by the Purchaser (or
such designee) or such Depositor, as such are incurred, in connection
with the termination of the Servicer and the transfer of servicing of
the Mortgage Loans to a successor servicer. The provisions of this
47
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.
[Signature Page Follows]
48
IN WITNESS WHEREOF, the parties have executed this Agreement under
seal as of the date and year first above written.
XXXXXX XXXXXXX MORTGAGE CAPITAL INC.
(the Purchaser)
By:
-------------------------------
Name:
Title:
INDYMAC BANK, F.S.B.
(the Servicer)
By:
-------------------------------
Name:
Title:
EXHIBIT 1
REMITTANCE REPORT
Exh. 1-1
EXHIBIT 2
CUSTODIAL ACCOUNT CERTIFICATION
_______ __, 200_
The Servicer hereby certifies that it has established the account
described below as a Custodial Account pursuant to Section 2.04 of the
Servicing Agreement, dated as of September 1, 2006, Conventional Fixed Rate
Mortgage Loans.
Title of Account: "IndyMac Bank, F.S.B. in trust for Xxxxxx Xxxxxxx
Mortgage Capital Inc., owner of Conventional Fixed Rate
Residential Mortgage Loans, and various Mortgagors."
Account Number: _____________________
Address of office or branch
of the Servicer at
which Account is maintained: ______________________________
INDYMAC BANK, F.S.B.,
Servicer
By:___________________________
Name:_________________________
Title:________________________
Date:_________________________
Exh. 2-1
EXHIBIT 3
CUSTODIAL ACCOUNT LETTER AGREEMENT
_______ __, 200_
To: ___________________________
___________________________
___________________________
(the "Depository")
As Servicer under the Servicing Agreement, dated as of September
1, 2006, (the "Agreement"), we hereby authorize and request you to establish
an account, as a Custodial Account pursuant to Section 2.04 of the Agreement,
to be designated "IndyMac Bank, F.S.B. in trust for Xxxxxx Xxxxxxx Mortgage
Capital Inc., owner of Residential Mortgage Loans, and various Mortgagors."
All deposits in the account shall be subject to withdrawal therefrom by order
signed by the Servicer. 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.
INDYMAC BANK, F.S.B.,
Servicer
By:___________________________
Name:_________________________
Title:________________________
Date:_________________________
Exh. 3-1
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:_________________________
Exh. 3-2
EXHIBIT 4
ESCROW ACCOUNT CERTIFICATION
_________ ___, 200_
________________________ hereby certifies that it has established
the account described below as an Escrow Account pursuant to Section 2.06 of
the Servicing Agreement, dated as of September 1, 2006, Residential Mortgage
Loans.
Title of Account: "IndyMac Bank, F.S.B., as servicer, in trust for Xxxxxx
Xxxxxxx Mortgage Capital Inc., owner of Residential
Mortgage Loans, and various Mortgagors."
Account Number: ___________________
Address of office or branch
of the Servicer at
which Account is maintained: _________________________
_________________________
_________________________
_________________________
INDYMAC BANK, F.S.B.,
Servicer
By:________________________________
Name:______________________________
Title:_____________________________
Exh. 4-1
EXHIBIT 5
ESCROW ACCOUNT LETTER AGREEMENT
_______ ___, 200_
To: _____________________________
_____________________________
_____________________________
(the "Depository")
As Servicer under the Servicing Agreement, dated as of September
1, 2006, Conventional Fixed Rate Residential Mortgage Loans (the "Agreement"),
we hereby authorize and request you to establish an account, as an Escrow
Account pursuant to Section 2.06 of the Agreement, to be designated as
"IndyMac Bank, F.S.B., as servicer, in trust for Xxxxxx Xxxxxxx Mortgage
Capital Inc., owner of Conventional Fixed Rate Residential Mortgage Loans, and
various Mortgagors." All deposits in the account shall be subject to
withdrawal therefrom by order signed by the Servicer. 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.
INDYMAC BANK, F.S.B.,
Servicer
By:_______________________________________
Name:_____________________________________
Title:____________________________________
Date:_____________________________________
Exh. 5-1
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:_____________________________
Exh. 5-2
EXHIBIT 6
DELINQUENCY COLLECTION POLICIES AND PROCEDURES
Exh. 6-1
EXHIBIT 7
CERTIFICATION
-------------
Re: The [ ] agreement dated as of [ ], 200[ ] (the "Agreement"),
among [IDENTIFY PARTIES]
I, ________________________________, the _______________________
of [NAME OF COMPANY] (the "Company"), 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:
First, 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 servicing reports, officer's certificates
and other information relating to the servicing of the Mortgage Loans by
the Company during 200[ ] that were delivered by the Company to the
[Depositor] [Master Servicer] Information");
Second, Based on my knowledge, 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 with respect to the period of time covered by the
Company Servicing Information;
Third, 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];
Fourth, 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
Fifth, 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]. Any material
Exh. 7-1
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.
Date: _________________________
__________________________________
[Signature]
[Title]
Xxx. 0-0
XXXXXXX 0
XXXXXXXXX XXXXXXXX TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The assessment of compliance to be delivered by [IndyMac Bank,
F.S.B] [Subservicer] shall address, at a minimum, the criteria identified as
below as "Applicable Servicing Criteria":
------------------------ -------------------------------------------------------------------- ------------------------
Applicable
Servicing Criteria 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.
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
1122(d)(1)(iii) Any requirements in the transaction agreements to maintain a
back-up servicer for the mortgage loans are maintained.
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
1122(d)(2)(ii) Disbursements made via wire transfer on behalf of an obligor or to
an investor are made only by authorized personnel.
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
Exh. 8-1
------------------------ -------------------------------------------------------------------- ------------------------
Applicable
Servicing Criteria Servicing Criteria
------------------------ -------------------------------------------------------------------- ------------------------
Reference Criteria
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
1122(d)(2)(vi) Unissued checks are safeguarded so as to prevent unauthorized
access.
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
Exh. 8-2
------------------------ -------------------------------------------------------------------- ------------------------
Applicable
Servicing Criteria Servicing Criteria
------------------------ -------------------------------------------------------------------- ------------------------
Reference Criteria
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
1122(d)(4)(ii) Mortgage loan and related documents are safeguarded as required by
the transaction agreements
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
Exh. 8-3
------------------------ -------------------------------------------------------------------- ------------------------
Applicable
Servicing Criteria Servicing Criteria
------------------------ -------------------------------------------------------------------- ------------------------
Reference Criteria
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
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).
------------------------ -------------------------------------------------------------------- ------------------------
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.
------------------------ -------------------------------------------------------------------- ------------------------
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.
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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.
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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.
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Exh. 8-4
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Applicable
Servicing Criteria Servicing Criteria
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Reference Criteria
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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.
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1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible accounts are
recognized and recorded in accordance with the transaction
agreements.
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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.
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[INDYMAC BANK, F.S.B] [SUBSERVICER]
Date:____________________________________________________
Exh. 8-5
